IMO, there are a few major problems the Industry currently faces.
1) Presently there are simply not enough Owners on hand who are willing to race the current foal crop, let alone the Industry embarking on a course of breeding more foals. The HRA Breeders Panel did some excellent work, returned some fantastic statistical research and made a number of excellent suggestions however that particular aspect of their report (the breed more foals mantra) was a steaming great load of old bollocks if ever there was one.
2)
The current number of horses that we do breed have long been scanadlously under-utilized either by way of having their racing careers greatly curtailed either by that which is effectively a 'force them out through the top' handicapping system... or otherwise by way way of a straight up lack of reasonable racing opportunities against their own sex (fillies and mares).
Wholesale changes in handicapping & a far more pragmatic approach to reasonable racing opportunities for the approx. 50% of the annual foal crop who's requirements we currently only give lip service to at best, fillies & mares, would be smart and welcome moves.
3) Hand in hand with (2) is a flipside...the furphy that young horses are annually being burned up. This is simply not the case.
Recent official studies & figures suggest the complete opposite, as compared to their predecessors the foals we are breeding these days are in fact getting to the track in far greater %'s / numbers, they are having more starts per age group & they are racing for longer. This goes directly to the HUGE increase in available sire quality that we have seen in the last decade.
The young horse being burned up routine is simply not a plausible reason why there are less horses racing/smaller fields. Instead, that aspect goes directly and inescapably back to the above (1)...a lack of Owners. It is no more no less complicated than that.
In conjunction with the above, when you then consider the ebb & flow of local, State, National & International economic conditions & how they are directly and indirectly impacting on the above, none of the problems that we & numerous other Industries face should come as any great suprise. We can go into each and every aspect and disect the nitty gritty of this & that & the other & that's by no means a bad thing because it keeps things sharp & focussed...but ultimately & inescapably, $$$money$$$ fixes everything.
http://www.youtube.com/watch?v=OaiSHcHM0PA