PAYMENT LIMITS are an interesting subject. I know some pretty heavy hitting farm activists. Guys that want to take no prisoners when it comes to farm consolidation, corporate domination, contract farming, WTO, and COOL. But when I ask those same guys where they stand on farm payment limits they say “oh no, not that.”
I have watched the changes in my own neighborhood since 1995, and they have been stunning. Some farms have doubled and tripled in size while others are just treading water. Every year a few more just disappear. I can go to EWG and look up some of the biggest I know and see how well they do at collecting government dollars. Lots of that growth comes through cash rent acres that go to them as the high bidders. Land owners are slowly being excused from responsibility for the productivity of their farms. Some I know or have talked to have even demanded cash rent and that the renter make annual applications of P&K to their specs.
Farm payments at the current levels are to blame for much if not all of this. Landowners know just how big those payments can be. Offering support without limit to any group or industry will result in the same type of fiasco as we have in U.S. agriculture now. If you need proof look at the airline industry.
This farm program stinks because it has victimized many of the people it was professed to have helped. I've seen it with my own eyes. One reason why the EWG web site has such an effect on people is that it really is every bit as bad as it looks.
My farm activist friends and many others all think that if things get bad enough, and they figure they will, that they will need those big limits for themselves. Trouble is by then the big farmer who lives three towns away will already have run them out as he pursues his bid to farm the entire state.
I used to raise hogs until the income from 20 sows became irrelevant in the contribution it made to my family living. One thing I learned from my hogs was that the biggest will always crowd up to the trough and keep the rest of the pigs from eating. The more the big hogs eat, the fatter they get and the harder it is for the rest to live. The run of the mill pigs don't become thrifty 'til the fat hogs are sorted off.
It's just human nature.
Richard R. Oswald
GREAT INTERVIEW with Luther Tweeten (“Ag economist slams farm programs,” Delta Farm Press, April 4, 2003)! I wonder how he defines “subsidy.” Seems that in the article he is referring to price and loan supports and other direct farm payments. What about Cooperative Extension (or at least the parts of it focused on ag production) and the ag experiment stations? Do these parts of the land grant university system constitute a subsidy? By the way, I work for Cooperative Extension in California.
UC Cooperative Extension Soils Specialist Davis, Calif.
I HAVE been farming for 30 years and find your interview with Luther Tweeten (“Ag economist slams farm programs,” Delta Farm Press, April 4, 2003) interesting. I believe Tweeten makes some good arguments in pure economics. However, in applied economics, I see a parallel between agriculture and the domestic oil industry. Without subsides the agricultural infrastructure would be shifted offshore and the U.S. would have no control over prices or supply. Agricultural subsidies should be seen as an insurance policy for national security. The European nations remember being hungry in WW II. This country has never starved. Think about it.
Tweeten's poor analogy
I ENJOYED your article (“Ag economist slams farm programs,” Delta Farm Press, April 4, 2003), yet even a cursory reading availed a huge fallacy in Mr. Tweeten's argument. It is my opinion that the product of a drug abuser's habits are of no substantive value to society (rather it comes at high social costs) — yet, America benefits greatly from having a home-grown food and fiber infrastructure… unless we believe it's okay to be dependent upon other countries for food.
However, I am all for funds being redirected to markets and programs that help growers help themselves, i.e. niche marketing, value added integration, cost cutting incentives, etc., rather than direct payments. Bottom line — I don't mind the argument, but the analogy is very poor.
Shea Nieto, MBA
Casa Grande, Ariz.
I WAS a member of the audience in Jonesboro, Ark., at the Arkansas State University's Agriculture-Business Conference recently when Dr. Luther Tweeten spoke (see “Ag economist slams farm programs,” Delta Farm Press, April 4, 2003).
I asked Dr. Tweeten if the national debate on ending all farm programs had already taken place and didn't his side lose the argument. Didn't Congress and the Commission on 21st Century Production Agriculture recommend that a new farm bill was needed to replace the (then) current bill, Freedom to Farm? His answer was that he did not agree with everything the commission said. The correct answer to both questions was “Yes.”
Background: Freedom to Farm was shoved on the farm community in 1995-96 by authors whose goal was to eliminate farm programs. Following two years (1998-99) of rotten farm prices, Congress and the 21st Century Commission agreed that it was in the national interest to continue farm programs. So the experiment to end farm programs failed.
Proof that Dr. Tweeten's proposal is dangerous and irrational lies in recent history and current facts. It is producers who are being short changed, yet Dr. Tweeten is advocating showering more wealth on a sector already recording record profits.
He also advocates taking funds from producers for rural development programs. How foolish. Depopulation in rural areas is happening to a large degree because of the shrinking farm numbers and the rural businesses that once served them. Yes, we need improved infrastructure, water and sewer systems, health care, educational and employment opportunities. But without addressing the largest employer and income generator — production agriculture — it is asinine to think a rural community can become healthy.
This is an undisputed fact: the production system of agriculture in this country has been a marvel. No other industry has so rapidly adopted technology and gained efficiencies at a consistent rate as production agriculture, mainly because of the diverse system of entrepreneurs known as the family farm system. In return for taxpayer investments, citizens are being fed for less of their disposable income than any population on the globe. The farmers' share of that food dollar continues to shrink while the profits soar for those who handle the product after it leaves the farm gate.
The system is serving the nation well and to propose abandonment based on some mythical free market theories is utter nonsense.
I'm grateful that several highly respected economists don't agree with Dr. Tweeten. Data at Texas A&M and elsewhere proves that Dr. Tweeten is wrong when he argues that larger farmers are doing well. It matters not, wherever, whoever, or whatever you grow, if you are dependent on production agriculture you have troubles. Any large, small or midsize farmer doing well in these parts is relying on income from other sources.
We may never be able to do it, but it's past time that we allowed the nonsense coming from taxpayer funded professors to drive our farm policy when they can't defend their arguments with facts.
Harvey Joe Sanner
Des Arc, Ark.
EDITOR'S NOTE: This letter refers to the Feb. 21, 2003, Delta Farm Press article “Eradication vote fails fifth attempt.”
I RAISE cotton in Stoddard and Dunklin counties in the Bootheel of Missouri.
I have grown cotton for 45 years and enjoy it. I voted for eradication three years ago. I thought it would work — it hasn't. It's a waste to the taxpayers and the farmers.
The eradicators kill our beneficial insects which are worth more than all the pesticides in the world. Perhaps if we had better management it would have worked — what we got were bankrupt cotton farmers trying to run it with no common sense.
Good cotton farmers had the boll weevils under control. Now, we have to spray more than ever before. We've known for a long time that malathion will not work.
If (eradication were ever) voted on statewide and failed, then the entire state should eradicate the eradicators. Thank you for letting me express my opinion.
Biodiesel: If not us?
A RECENT Delta Farm Press article (“Biodiesel markets growing,” pg. 20, April 4, 2003) implied that biodiesel prices may be too high for growers to use on their own farms.
As a soybean grower in Arkansas and president of the Arkansas Soybean Association, I find the suggestion short-sighted. The biodiesel industry has earned increasing commercial success during the last few years, but now is a pivotal time for this alternative fuel to build demand. Farmers have already invested more that $25 million checkoff dollars in bringing the biodiesel industry this far. Now it is up to us to invest just a few cents more per gallon to use at least a 2 percent blend (B2) of biodiesel on our farms. If every farmer used B2, it would create enough demand to use the oil from approximately 51 million bushels of soybeans a year.
The slightly higher price of B2 is a small investment that will pay off for growers. The Food and Agricultural Policy Research Institute (FAPRI) estimates that if biodiesel use is increased due to energy security and pollution control measures, and if an additional 2 billion pounds of soybean oil demand is created, then soybean prices would increase by 3 percent. Using a 10-year average, this would be 15 cents per bushel.
According to Michael Popp, associate professor of agricultural economics and agribusiness at the University of Arkansas, given certain assumptions such as the FAPRI analysis, “even a slight increase in soybean prices (<1 percent) due to increased demand for biodiesel from producers and others would justify the use of biodiesel blend fuel on farm.”
Even though many farmers across the country use a B2 blend, my belief in the performance of the fuel and the potential economic impact a growing biodiesel industry would have on my farm have led me to use B5. In my own operation, B5 costs about 6 cents per gallon more than No. 2 diesel. This means that for the extra 75 cents I invest per acre by using biodiesel, the potential net return could be as high as $3.75 per acre.
In time, the price of biodiesel is expected to drop. In fact, a partial federal excise tax exemption is currently included in the Senate energy bill. This would provide a reduction in the federal excise tax on diesel fuel of one penny per percent biodiesel in a biodiesel blend fuel up to 20 percent blend of biodiesel. Although off-road diesel fuel is currently not taxed, all consumers would benefit from the increased demand for biodiesel and other provisions in the bill, such as a blenders tax credit.
One champion of this legislative effort is Sen. Blanche Lincoln, D-Ark. She is an original co-sponsor of the bill that ultimately got the biodiesel tax incentive into the Senate energy bill currently under consideration. On the House side, Rep. Marion Berry, D-Ark., is an original co-sponsor of a similar bill providing a tax incentive for biodiesel. Arkansas residents should be gratified that these two leaders have taken on this challenge for the betterment of our state and nation.
Those of us who use biodiesel blends on the farm are also gaining an important performance benefit. A 2 percent blend of biodiesel can increase lubricity of the fuel by up to 65 percent, according to tests done by Stanadyne Automotive Corp., the leading manufacturer of fuel injection equipment in the United States. Increased lubricity can help extend engine life by preventing premature wear on engine parts.
Let's not forget that every time we use biodiesel, we are reducing this country's dependence upon foreign oil. That is a commitment we should be willing to make if we truly believe that the United States should get more of its fuel from the farm and less from the Middle East. All four branches of the military use biodiesel here at home, and we can show support for our troops by doing the same.
But all of these arguments may boil down to a much simpler question: if we won't use our own product, why should anybody else?
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