(January 28, 2011) - Over the years as we have talked to farmers about their health care coverage, we find that they fall into four groups. A large number of farmers have a spouse who works in town and has access to health insurance through an employer-paid group insurance program. When asked, these farmers often acknowledge that the health insurance coverage is more important than the salary.

A second group of farmers does not have access to an employer-paid group insurance program and are forced to purchase their insurance either through a farm group or in the individual market. This often means higher premiums and higher deductibles. Except for the largest farmers, every illness is a question of “can we afford to go to the doctor or will it clear up by itself.” While some have argued that health care costs are so high because those with employer-paid plans go to the doctor too often, many of the farmers in this situation don’t go to the doctor’s office often enough.

A number of farmers simply go without health insurance. They can’t afford both the insurance premium and the seed and fertilizer they need; and the part-time job in town doesn’t provide health care coverage at an affordable price. If they or a member of their family experiences a catastrophic illness, it could mean the loss of the farm.

(January 21, 2011) - The current concern over the US federal budget deficit will be a major factor in the formulation of the 2012 Farm Bill. An editorial in the Sunday, January 16, 2011 New York Times titled, “Here’s an easy one,” said “here is one big-ticket saving that all members of Congress should get behind: cutting the billions of dollars in farm subsidies that distort food prices, encourage overfarming and inflate the price of land.”

It is tempting to view the position advocated in the editorial as an aberration, but we fear that it is merely a high profile example of the general media’s lack of understanding when it comes to the unique nature of crop agriculture. At the same time, there are elements of the current farm program that are hard to defend.

And, the Times editorial board quickly hits the most vulnerable element: “$5 billion in direct payments that are delivered regardless of what or even whether farmers plant.” What they don’t say is that the direct payments were established under the 1996 Farm Bill, known by its supporters as “Freedom to Farm” and its detractors as “Freedom to Fail.” As originally conceived, direct payments—which were originally called “Agricultural Market Transition Act (AMTA) Payments” in 1996 Farm Bill—were, as the name suggests, supposed to transition down to zero.

Trade Stories Project

Dwight Ault

Dwight Ault is a seasoned Minnesotan farmer.  Dwight farmed 8 years in Iowa, then made the move to Minnesota, and has been here, between Blooming Prairie and Austin, for the past 40 years.  Dwight farms with his son and no other employees.  The two are “totally dependent” on their general livestock consisting of sheep, hogs, and cattle.  The farm is small, about 140 tillable acres, and with an additional 155 acres in the conservation programs.  Dwight has made some big changes over the years, including the transition to an entirely organic operation, which will be completed by the end of 2010, and has also seen many changes in the rural communities.

(January 14, 2011) - In creating computer models of the agricultural sector, modelers have often treated stocks as a demand factor, leaving exports to take up whatever is left over—residual demand. As a consequence of this assumption, analyses of policies or conditions that cause grain supplies to increase while domestic demand remains relatively stable result in the overestimation of exports and prices.

As we read Derek Headey and Shenngen Fan’s “Reflections on the Global Food Crisis,” we were pleased to see their quote from Congressional Research Service Specialist in Agricultural Policy Randy Schnepf’s 2006 report, “Price Determination in Agricultural Commodity Markets: A Primer.” In that report Schnepf wrote, “most market observers consider exports to be the great uncertainty underlying commodity supply, demand, and price forecasts.”

Ignoring the uncertainty of exports has driven agricultural policy since the adoption of the 1985 Farm Bill, when we lowered the loan rate in an attempt to “recapture” the exports that many argued rightfully belonged to the US. As we have seen, export markets are not the property of any nation and our attempt to lower loan rates were unsuccessful in increasing US exports.

(January 9, 2011) - When Wes Jackson, Wendell Berry and Fred Kirschenmann get together, conversation, laughter and ideas flow.

Other than a closeness in age, the three appear to have little in common. Jackson is a Ph.D. plant breeder and founder, in 1976, of The Land Institute, a Salina, KS non-profit dedicated to finding sustainable solutions to food’s uncertain future.

Berry is, of course, a giant of American letters, a poet, essayist, novelist, non-fiction writer and, as he unfailingly notes, a farmer. “I am of the party of the land and the people,” Berry told the Community Farm Alliance in his native Kentucky Dec. 4.

Kirschenmann practices what he preaches: he is both a Distinguished Fellow for the Leopold Center for Sustainable Agriculture at Iowa State University and the manager of his family's 3,500-acre certified organic farm in south central North Dakota.

For two years, this trinity of farm and food eloquence and evangelism has been writing and lecturing on the need for a long-term, sustainable ag policy where, as Jackson explains, “today’s awful dualism that pits production against conservation” is replaced with “more natural ecosystems where conservation is a consequence of production.”

That shift in practice will require a shift in policy—a dramatic shift—centered on soil and water, not fructose, feed or even food.

(January 7, 2011) - One of the overriding questions surrounding the sudden and sharp increase in agricultural prices in the 2006-2008 period is the role of the index funds in the increase. We have written about it before, as have Derek Headey and Shenggen Fan in their IFPRI Monograph, “Reflections on the Global Food Crisis.” Those who believe that the index funds contributed significantly to the price bubble believe that commodity exchange rules need to be changed. They would like to see similar position limits and other rules put on index funds that are already in place for traditional speculative traders.

Overall, in our view, IFPRI’s Headey and Fan report on the 2006-2008 global food crisis is a solid analysis and we commend them for it. We recommend it as required reading by anyone trying to understand what brought about the “2006-2008 food crisis.” That said, there are some topics that we believe Headey and Fan glossed over too quickly or omitted completely. In previous columns we have discussed a couple of those perceived shortcomings including the role of stocks as reserves and early farmer-based efforts to boost grain prices by jumpstarting the production and use of ethanol.