The Story of the Small Farm

I grew up on a small farm. So yes, I am biased. But it also means that I have experienced it firsthand and been a part of a small farming community. Small farms, locally grown food, and environmental preservation are all values that I hold in extremely high regard, having experienced them firsthand. However, this does not mean that I automatically assume that large farms are bad, or even that industrial farming is necessarily bad. In a country as large as the United States, feeding the population would be impossible without at least some instances of large-scale farming. I certainly think that there are many serious problems with the industrial agriculture system, most of which stem from market demand and government policies surrounding the system, but I do not think that large farms are inherently bad. As you will see in the following paragraphs, much of today’s agricultural system is a result of the (inter)national economic context at the time and is not necessarily a result of farmers’ constant desire to mechanize.

A quick look at some of the statistics on farm size in the United States shows a massive difference between the largest and the smallest farms. For instance, nearly 90% of the dairy industry is controlled by four farms, 80% of the beef industry is held by Tyson and Cargill alone, and almost 70% of the pork industry is controlled by Smithfield, Perdue and Sanderson. The U.S. Government Accountability Office (GAO) notes that 26 farms in 6 industries controlled at least 70% of all American commodities (http://www.gao.gov/key_issues/farm_programs/issue_summary#t=1). These farms are industrial, consolidated agribusinesses that depend on fossil fuels and use massive amounts of other resources such as water and land.

Farms in the early days of the U.S. were small family operations that were self-sustaining and diverse. Animals, vegetables, fruits, timber, and other products were all harvested and utilized either for the family or at the market. Gradually, as Westward expansion continued, farms began to get larger and more specialized. Cotton farms in the south began to stretch over hundreds of acres, and cattle ranches in the West covered thousands. The early years of the 20th century were great years for the agriculture sector as far as the market was concerned. The Commodity Credit Corporation, established by President Hoover’s administration, set effective price floors for common crops grown by farmers and provided them with financial backup if prices dropped to extremely low levels. Farmers would then hold their crops off of the markets until the prices rose, then repay those loans to the CCC with interest. This system worked smoothly for many years, and a national grain reserve was built up to provide food for the country in times of extreme need. But corporations and banks couldn’t let this work for too long, since it ate into their investment potential and profit potential. Farmers with steady incomes and markets with price floors were too steady for them. Ag commodity speculators and investors make more money when there are large price fluctuations, and the economic stability of the early 1900’s was not to their liking. To that end, they engaged lobbyists and corporate planners to proposed legislation that would significantly reduce the number of farmers on the land and raise the volatility and consolidation of the agriculture sector and lower production costs. They argued that getting farmers out of farming would make it possible for larger amounts of money to be invested in larger-scale production operations. Sadly, these corporations ended up removing thousands of farmers from their land and forcing the government to put massive subsidy programs in place to help the few mega-farms still remaining to survive in a newly-unstable market.

Land prices began to go up while the value of the land plummeted. Local agricultural economies all over the country began to fail. Costs of production dropped and the price of machinery sky-rocketed. Subsidies became increasingly larger and the number of farms became increasingly smaller. With fewer farmers to work the land, the remaining farmers had to work twice as hard to maintain production levels and were forced to grow their crops at all costs. Unfortunately, the quality and long-term health of the soil was one of the primary costs. The subsidies that were given to the largest farmers grew exorbitantly so and forced them to overproduce. The extra crops were then shipped to countries in the Developing World in the name if “aid,” effectively stifling their local agricultural economies and creating a cycle of dependence on imported U.S. food products.

This situation was complicated by the fact that the number of larger farms and the growing disparities in farm size began to make it difficult for smaller farms to participate in the agricultural economy. When combined with the Industrial Revolution and the resultant explosion of mechanization, small farms were rapidly pushed out of the market. Co-ops were formed by the small farming community to try to consolidate market power, but they ended up morphing into anti-industrialization groups and therefore worked against the markets. Congress then took matters into its own hands and amended the anti-trust laws of the time, which were designed to ensure fair markets, so that agricultural organizations were exempt from them. Its goal in doing this was to protect small farms from being taken over by the industrialization of farming and give them a measure of relief from the increased competition.

While this amendment worked in some places, Congress’ actions had several outcomes that weren’t as beneficial to small farms as intended. In effect, small farms became largely excluded from the market. The large-scale industrial agribusiness operations are now so firmly embedded as the foundation of the agricultural economy that there is no chance for a small farm to make any sort of meaningful inroad. Sadly, Congress’ amendments actually did more to remove small farms from the market than it did to protect them from industrial take-over. Small farms are now left on the sidelines, unable to consolidate as easily as the large agribusinesses are (the recent international agricultural fertilizer company mergers are an excellent example of this) and are forced to find or make their own market.

Anti-corporate farming laws are another example of a government measure that has had (previously unforeseen) negative consequences. An earlier post talked about the Anti-Corporate Farming lawsuit that is currently going on in North Dakota. Such laws basically inhibit certain large corporations from engaging in agricultural and outline the ways in which corporations can legally own and use land. They were historically created to protect small family farms from the competitive disadvantages of being in the same market as the large corporate farms, but they are now making it very difficult for farms in these states’ agricultural systems to evolve with the market. Additionally, they are making it difficult for farmers to plan for the future and develop farm transition pathways for the next generation of farmers. This is an especially urgent and serious issue for small farms, the majority of whom are family-run and will quickly dissolve if not passed on to a family member or (in very rare instances) a committed outside buyer). With the already-small number of family farms rapidly diminishing, legislative barriers to small farm continuation are exactly what we do not need. Thankfully, the new food movement has provided such a market in certain parts of the county and the situation for small farms is becoming less and less dire. The growth of farmers markets, local agricultural economies, and the increasing demand for organic, sustainably-raised food is continuing to help small farms stay afloat. But the future of the small farm is still hanging in the balance.

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