Processing and transportation do take up a goodly portion of the cost of produce. But, the public wants tomatoes in December, lettuce in March, and all sorts of out-of-season vegetables available when they want. We pay for irrigation, hoop houses, and shipping.
We live in a farming/ranching region, and without government crop insurance, low-cost farm loans, and the advice provided by the USDA and state universities, many family farms would go out of existence.
The California drought is tragic--almond orchards drying up, acres of cropland becoming unproductive--it is heartbreaking for the land owners and farmers.
We have planted three more vegetable gardens here on our little farm, anticipating the increased cost of vegetables usually grown in California. We aren't going to use all this produce, but plan on donating all we can to a local food pantry. I won't pay a dollar for a bell pepper, but for us it is "won't" not "can't" as it is for many people on very limited budgets. For many, fresh vegetables are a luxury.
Eventually Texas will face the same problem California has, which is basically caused by rampant expansion, growing population, and more and more demands on infrastructure, especially water needs. We have had towns run out of municipal water; there are water restrictions in large metro areas; and when drought hits, we have hard decisions to make.
Eight years ago we started putting in water harvesting systems--very basic, low-tech, but they work. Locals thought we were tree-hugging idiots--now they are asking where we got the big fiberglass cubes and how we manage the water delivery (one lady with big biceps carrying five-gallon pails of water to plants that need it--I said it was basic!).