Sunday, March 21, 2010

Letter From Langdon: Waiting for Rural America's New Deal

08/13/2007

Texas cafe Cafe in McKinney, Texas
Photo: TxDaisey

LANGDON, Mo. -- With passage of the farm bill, the House of Representatives forfeited the opportunity to do something this country hasn't tried since the New Deal of the 1930s: It could have taken steps to rejuvenate rural America.

In the year I was born, 1950, there were 13 houses along our road in the far northwest corner of Missouri. All of them were farm homes. Today, nine houses are left, and I am the only farmer or farm owner living here.

What's happened along my road is also true across vast areas of the Midwest, where farm consolidation over the past three decades -- big farms gobbling up small ones -- has taken its toll, not just on farmers but on the rural communities that once relied on farmers for trade and taxes.


Consolidation and loss of rural population have been direct consequences of the past several farm bills. By increasing subsidies, Congress made it profitable for the most aggressive operators to accumulate more land and scoop up a large share of the farm bill's allotments.

While the stated purpose of farm bills has always been to maintain the family farm, in reality the Congress has brought about the family farm's decline.

The House might have fashioned a 2007 New Deal for Rural America. It would have started with real subsidy limits, making mega-farms less profitable. That step should have been easy.

There is so much demand now for grains -- as both fuel and food -- that, finally, we have strong, demand-driven markets. Now is the perfect time to move grain farms away from direct payments while insuring crop yields and revenue.

It's been said that farmers live as paupers and die as millionaires. While many farmers look rich on paper, few have million-dollar earnings. In fact, most farms earn only about a 5 percent return on investment. In low production years of drought or flood, farmers can lose money.

In reality, farmers are wage earners who invest in their own employment. When our profits decline due to poor markets or bad weather, not only our investments but our wages too are at risk. The misguided crop subsidy program that the House maintained protects large farms doesn't go far enough to support small farmers. It excludes livestock producers, many of whom are suffering through an epic drought.

Richard Oswald of Langdon, Missouri.richard oswald

What producers really need is a safety net that is not paid out as a "bigger is better" stipend -- the incentive that has folded family farms into sprawling agribusiness. What farmers want is the comforting knowledge that when bad luck, bad weather or bad markets come (and they always do), there will be a mechanism, an insurance policy, there to soften the blow.

The House could have offered real assistance to local producers willing to grow food in sustainable and humane ways. Legislators could have protected livestock raisers from contracts with multinational meat packers who force farmers to absorb most business costs and all the risks.

Instead, the House bypassed the most vulnerable farmers and, in the meekest of reforms, limited subsidies for a tiny group of the richest farm businesses, or, as is too often the case, millionaires with farm interests.

Huge payouts to large farms will never help rural communities because large farms contribute little to local economies. Big farms buy the mammoth machines needed to work vast acreages -- a fully equipped grain combine can run over a quarter of a million dollars -- far away from the local community.

They sell goods wherever the market offers advantages.

Big farms mine agriculture only to spend the profits elsewhere. They have no loyalty, no ties, and no allegiance to towns of 500 or 1,500 people, such as mine. An emphasis on economic development would have helped rural communities grow jobs, as well as crops. And lower limits on direct payments to the largest farms could have freed capital for rural rejuvenation.

The recent farm bill is notable mostly for what it didn't do. It did not end the unfair advantage granted to large farms over small. It did not rescue livestock producers from a downward spiral of corporate control and drought. It did not silence the lobbyists of multinational grain buyers. It did not offer meaningful limits on farm payments. It did not answer the call from rural communities for real economic development. It did not establish reliable disaster assistance for all domestic growers of food.

In July 2007, as rural Americans watched and waited, the House had the opportunity to create an epic farm bill of New Deal proportions. The Senate takes up its debate on the farm bill soon. We are still waiting.

Comments

epic farm bills?

Being a farmer from central Illinois, I just wanted to quickly comment on this article. First, I'm kind of tired of hearing about "new" and" improved "farm bills. Any farm bills that talk about "getting the government out of agriculture" like the failed Freedom to Farm(1996)..or improving the situation like the supposed "answer" in Farm Bill 2002 need to have qualifying statements added to them. Politicians seem to be fixated on the "givers" to their relection campaigns(big guys and big corporations) and the "numbers" of relection voters they want to cater to.(.i.e..smooth sailing to citizenship for illegal immigrants..the temporary law to be undoubtedly passed soon...You wanted some more health and education expenses to write off for more illegal newcomers....right?) Second, it's kind of tiring to hear about the "high" price of corn causing "all" food prices to go up.. Yea, I know I'm not a livestock farmer..I used to be..but I'm tired of watching us corn and soybean producers produce fence row to fence row..overproducing corn and soybeans to sell under the cost of production. I heard 30 plus years ago in college.."don't worry we'll EXPORT this corn and beans and GOOD TIMES will be had by all farmers.. Third, as for economic development, let's focus on the friggin farmers and the prices they should have been receiving AT THE MARKETPLACE..where the true cost of production should also yield a fair profit.. I know..that's a novel idea or a real dream right? There is little doubt that meaningful caps and limits on farm payments should have been put in place years ago..But folks, we let Agribusiness (in cooperation with several of our "farm"? organizations) write these goofy programs. And from what I'm hearing ..the same old roosters are trying several "new" techniques only with different names like "crop revenue" or "insurance" payments to make it sound enticing and different. If you truly believe this chicken feed( or droppings) they are putting in front of you.. then don't come squawking to me when wto and a "new improved" Farm Bill is enacted. Especially one with this current Administration's stamp on it... We heard ten years ago that crop prices would not need "propping" and that we could steer away from direct payments. With current wto negotiators willing and wanting to give away trade advantages to other countries..or waiting for future distorted wto "rulings" to unfairly slam America's producers..don't hold your breath on how long these "high" grain prices are going to last.. (in the U.S) Sorry to rain on some people's parade.. But wto negotiations , wto "giveaways", and wto "future U.S. bashing rulings" will really have far more implications than a goofy farm bill ,unless we let this current administration develop it.. or the Minnesota farmer that came up with the 96 Freedom To Fail.. In that case..we all better get in line to buy cheap land in another country and hire the cheap labor( from Mexico or that country) we Americans seem so desirous of employing in this "peaceful" global marketplace.

reply to Byron

Byron I can tell you've been there, done that. What's really tough to swallow about the current bill promoted by the House is that in spite of saying they closed loopholes, there are more now than before. With the strong defense of higher payment limits, it looks like Uncle Sam knows something about crop prices to come that we don't. Some people think the NAFTA Highway is a myth, but it's not, and it has some real implications for food and feed producers in the US. The NAFTA trade corridor from South America, up through Central America and Mexico will likely bring more than cheap manufactured goods. It could also bring ethanol and other commodities anytime exchange rates and domestic demand permit. I appreciate that you took time to read and comment on the article.