The
AGRIBUSINESS
EXAMINER
May 14, 2002   #162
Monitoring Corporate Agribusiness
From a Public Interest Perspective

EDITOR\PUBLISHER: A.V. Krebs
ADDRESS: PO. Box 2201, Everett, Washington 98203-0201

E-MAIL: avkrebs@earthlink.net
WEB SITE: http://www.ea1.com/CARP/
TO RECEIVE: Name and e-mail address
Contributions Welcome
 

COMMENTARY:
FAMILY FARM AGRICULTURE FACES EXTINCTION
UNLESS FAIR MARKET PRICE AND CONCENTRATION
BECOMES KEY FOCUS IN CHANGING ECONOMIC SYSTEM

Passage of the 2002 Farm Bill may prove to be the defining moment for family farm agriculture in our nation's history for the gauntlet has now been thrown down as to whether family farms are to assert themselves in an organized grassroots fashion or abdicate their remaining and dwindling power to corporate agribusiness.

It has been disgusting to see purported grass-roots membership farm organizations and those groups and organizations that purport to be the friends of family farmers grovel about for a few legislative crumbs off the table that were given them by the self-serving politicians that framed this new legislation.

While "commodityism" and "regionalism" once again reared their ugly heads in the debate over the legislation, the public, the media and the politicians were also being fed --- in daisy chain fashion ---  a steady diet of anti-subsidy misinformation which not only betrayed the perpetrators ignorance of farm economics, but heaped scorn upon the U.S.'s already beleaguered farmers from nations near and far throughout the world.

Throughout this current anti-subsidy propaganda blitzkrieg and the resulting legislation the organized family farm community remained shamefully mute. Save for the National Family Farm Coalition and a few of its local and regional affiliates no group or organization publicly challenged these subsidy myths that were abroad in addition to openly opposing the final farm bill that has now been signed into law by President-select George W. Bush.

This lack of verve and spine not only resulted in farm legislation that is already doomed to failure, but as policy that only continues to contribute to an image of farmers and the communities in which they live as being greedy and absorbed in self-interest at the expense of the common good. (see articles below)

The result has been a public relations disaster for family farm agriculture, in addition to successfully playing into the hands of corporate agribusiness in its century-old campaign to rid agriculture of its "excess human resources."

As Keith Mudd, a farmer near Monroe City, Missouri, so succinctly framed the current farm subsidy question, "regardless of where the income comes from, larger farmers will have the funds to buy out smaller neighbors. Therefore, it is not the subsidy that allows the larger farmers to buy out their smaller neighbor, it is the system. If Cargill and ADM had to pay for our production, the subsidy would not be necessary. If commodity prices were higher, farmers would make money from farming, would be less inclined to quit and would reduce the opportunity to expand farm size."

It was in the 1970's that the USDA issued periodic updates of efficient-sized farms by the type of cropland and what they produced. Curiously, after showing in almost every instance the sizes surpassed acceptable efficiency standards, the government agency eventually stopped publishing the reports due to "budgetary considerations." One can only imagine how such reports would read today ???

Nevertheless, Mudd's analysis is the type of message that the public needs to hear with the same regularity that it has been subjected to by those who believe that 'subsidies' are the 'evil-doers' in agriculture.

Today, any family farm policy worth considering requires that two related and fundamental issues need to be enunciated in a clear and unequivocal voice as family farm agriculture seeks to speak truth to corporate power, i.e. a fair market price paid to farmers for what they produce and meticulous consideration as to the consequences of corporate concentration in agriculture and our food system.

It is incumbent, therefore, that family farm agriculture become focused on these two elementary issues and that in setting out an agenda to educate the public, the media and most importantly our elected representatives that it seeks every possible contrivance to bring these two issues constantly into the mainstream of public dialogue when it comes to the question of farm and food policy.

Make no mistake about it !!! We have the facts of the matter on our side !!!

Thus, through constant and unrelenting educational efforts we need to marshall those facts in a way that they become both clear and unambiguous. At the same time, in tandem with that educational campaign, farmers should not be looking to join still another “coalition”  but rather getting out ---  in the famous words of Joe Hill --- and "Stop mourning, Organize !!!" remembering at the same time Fred Ross Sr.'s dictum "you educate to organize, not organize to educate !!!"

Relative to the market price issue, it bears constant repeating, the words of former Texas Agricultural Commissioner and chairman of the Democratic National Committee's Agricultural Council in 1984 when he chaired a series of eight nationwide farm policy forums on agriculture and concluded in his final report:

"When all was said and done, it came down to one word: Price. Other important issues were discussed at the forums sponsored by the DNCAC during the past six months, but the overwhelming consensus among participating farmers was that the other concerns --- overproduction, soil and water conservation, high interest rates, lack of credit, entry by young farmers, the depressed farm service industry, and the farm program's high
cost, to name a few --- could and would be solved when farmers received a fair price for their products."

Thus, no matter what the agriculture-related issue from conservation to country-of-origin food labeling, in addition to those noted by Hightower and a host of others, family farm activists need to constantly return to the question of price and how an equitable market price for farmers can be achieved. That issue can be approached from several different angles, but somewhere in that mix there are a few essential matters that need to be addressed.

First, today's reality of just what constitutes an efficient family farm needs to be made clear. The idea that when we talk about a grain and livestock farm, with sales of between $100,000 and $500,000, the core of family farm agriculture at present, we are talking about "super-sized" farms needs to be dispelled.

Again, as Mudd reminds us, "The Environmental Working Group argues that most of the subsidies go to the largest of farmers, who in turn use it to buy out their smaller neighbors. The truth is that all farmers, regardless of size, must use the subsidy just to raise the value received for their commodity above the cost of production. In most instances, the cost of production is covered and something is left over for living expenses. In practically no instance is anything left over that would be considered a return on investment (land and equity)."

In conjunction with an effort to determine just who is a family farm farmer and who isn't there is also the need for both regional and national full cost, life-cycle accounting and pricing studies for sustainable development agriculture. Not only would this allow people to more clearly understand the costs and what happens to their food before it leaves the farm gate, but it would go a long way toward dispelling the myth that the United States enjoys the cheapest food per capita of any nation on earth, when in fact our food system is replete with hidden economic, social, health, political and environmental costs.

The vast majority of those costs are now being borne by the public in general in various and sundry ways, ways which need to be shorn of their sophistry and laid bare as lies and deceit. In doing so the culprits, the propagators of such lies and deceit, those who A.C. Townley --- co-founder of the Non-Partisan League --- referred to as "the gamblers in the necessities of life," need to be held up to public scrutiny, warts and all !!!

By taking this approach we can demonstrate that the issue of a fair market price neatly folds into the second major issue that needs our immediate and carefully documented attention --- market concentration --- along with its many and varied forms and its resulting anti-competitive and anti-democratic consequences.

Clearly, these issues of a fair market price for agricultural commodities and increasing concentration must be joined together in not only a way that people can come to unequivocally understand, but that are shown as two cuts from the same cloth. To allow ourselves to be sidetracked by a lot of relative extraneous issues is only to play into the hands of our adversaries and divert our attention from the goal of achieving lasting social and economic justice in the context of the common good.

In short, as agrarian populist activists, we need to be the framers of our own arguments for economic and political democracy and not simply be placed on the defensive all the time or become entrapped in the classic "liberal dilemma." For, as Hightower has so straight forwardly put it, "we need to stop being progressives, and become aggressives !!!"

At the same time we also need to say to our well-meaning, but often single-minded colleagues, and to our sometimes apathetic, sometime passive farm neighbors --- if you are not going to be part of the solution, then you are indeed part of the problem !!!

There is no question that there are a myriad of agricultural and environmental issues facing us as a nation. But until we can authoritatively show that the system's issues are not the issue, but that THE issue is the system itself we will continue to see in agriculture unfair prices for farmers, more market concentration, and consumers forced to play Russian roulette with their own health and welfare and that of their families every time they shop for their food.

Likewise, in our coming efforts to change that system that has favored the richer becoming richer and the poor becoming poorer the words of the famous abolitionist Frederick Douglass in 1857 must become our mantra.

"Those who profess to favor freedom, and yet deprecate agitation, are men who want crops without plowing up the ground. They want rain without thunder and lightening. They want the ocean without the awful roar of the waters. This struggle may be both moral and physical, but it must be struggle.

"Power concedes nothing without a demand. It never did and it never will. Find out just what people will submit to and you have found out the exact amount of injustice and wrong which will be imposed on them. And these wrongs will continue until they are resisted with either words or blowsor with both. The limits of tyrants are prescribed by the endurance of those whom they oppress."
 

NATIONAL FAMILY FARM COALITION:
FARM BILL GOOD FOR AGRIBUSINESS,
A CALAMITY FOR FAMILY FARMERS

Members of the National Family Farm Coalition condemned the Farm Bill that was passed by the House and Senate last week and vowed to continue to fight for legislation that helps family farmers. Farm leaders say that Congress has once again ignored viable solutions to record low commodity prices, dwindling farm credit, and continuing loss of family farms. Instead, they argue, the farm bill is a massive transfer of wealth from taxpayers to corporate agribusiness.

"The 2002 Farm Bill spells disaster for family farmers," said Bill Christison, a Missouri grain farmer, President of the Missouri Rural Crisis Center and the National Family Farm Coalition. "However, Cargill and ADM executives must be dancing with joy today --- this legislation guarantees that they can continue to buy grain at less than the cost of production, subsidized by our tax dollars. And Smithfield brought back the pork once again: lack of a packer ban in the bill means that processors can keep artificially manipulating the market by using their own hogs to depress livestock prices and drive family farmers out of business."

George Naylor, Iowa farmer and member of  Iowa Citizens for Community Improvement said, "Everyone will know this bill is a failure within one year, if not sooner --- it should be called `Freedom to Fail Part Two'" and added, "The cheap grain guaranteed by this fencerow-to-fencerow program will mean more livestock in animal factories and the loss of diversified farming."

"A six year Farm Bill? No way --- mark my words, the federal budget won't allow it, and neither will voters when they realize their tax dollars are subsidizing a system that threatens our diverse and secure food supply," agreed Helen Waller, a Montana farmer and member of the Northern Plains Resource Council. "When the negative impact can no longer be ignored, family farmers will mobilize to support alternative legislation that solves the real problems of family farmers: the Food From Family Farms Act."

The Food from Family Farms Act, developed by The National Family Farm Coalition, ensures a fair price from the market for grains and dairy --- not taxpayer subsidies. It also features an effective domestic and international reserve program, and a comprehensive competition title that includes a packer ban and limitation on captive supplies.

"This farm bill is bad for family farmers all over the world," said Christison. "There is universal denouncement of the bill by international peasant and farmer groups, because they know that corporate agribusiness' push to depress prices for farmers knows no borders."
 

FARM BILL TERMED NOT ABOUT U.S. AGRICULTURE
BUT ABOUT BENEFITTING 150,000 U.S FARMERS
WHO WILL RECEIVE 80% OF ITS BENEFITS 

CAROLYN LOCHHEAD, SAN FRANCISCO CHRONICLE: The Senate dealt a blow Wednesday to the two million people of Burkino Faso who already live on less than $1 a day and scratch out that meager living from cotton, trade and global economic experts said.

The Senate-passed farm bill --- which President Bush has said he will sign  --- is likely to hurt residents of the West African nation and millions more of the world's poor, according to experts, as it increases spending for U.S. agricultural support by 80% over 10 years to $189 billion, much of it in subsidies for cotton,rice, wheat, corn and soybeans.

But contentions about damage to people overseas were dismissed by the bill's supporters, such as Iowa Democratic Sen. Tom Harkin.

"We stick up for our farmers," said Harkin, chairman of the Senate Agriculture Committee. "We work out what we feel is best for our producers and our farmers, not what's best for Germany or France or Brazil or China. . . . Our first obligation is to make sure we take care of our people first."

About 150,000 American farmers will receive roughly 80% of the money in the bill --- primarily industrialized farms in the South and Midwest. Cotton and rice are also grown by a few large farms in California's Central Valley. About 90% of California farmers, who grow vegetables, fruits, nuts and other specialty crops, will see little aid from the legislation. "It's not about American agriculture," said Rep. Sam Farr, Dem.-Carmel. "It's about a few folks in agriculture, and it's especially not about California agriculture."

The subsidies are expected to drive down world prices of key commodities, damaging the economies of the world's poorest countries, and remove pressure on Europe and Japan to reduce their subsidies. Agriculture provides about half of the gross domestic product of the world's poorest countries, said Thomas Beierle, an analyst with Resources for the Future, a Washington think tank.

World Bank studies show that U.S. farm subsidies, combined with greater protection in Europe and Japan, total $350 billion a year, equivalent to the entire gross domestic product of sub-Saharan Africa and more than seven times what rich nations spend on foreign aid.

"The signal this sends to the rest of the world is unmistakable," said M. Ann Tutwiler, president of the International Policy Council on Agriculture, Food and Trade, a research group. "The United States is not serious about agricultural trade reforms, and it is not serious about agricultural development in less-developed countries." A forthcoming World Bank-International Monetary Fund study finds that if cotton prices were not distorted by subsidies, Burkino Faso could cut in half the number of people living in poverty within six years.

The farm bill's supporters said their concern was agriculture at home. "This is a bill for American farmers," said Sen. Kent Conrad, Dem.-North Dakota "This is a bill for America." But Farr called that claim a myth. "It's not an American farm bill," said Farr, who represents the Salinas Valley. "It's a farm bill for five commodities in America."

The Senate approved the bill 64-35. California Democratic Sens. Dianne Feinstein and Barbara Boxer voted for it.

U.S. cotton producers received about $2 billion in subsidies last year, and the figure will jump sharply under the new bill. U.S. cotton subsidies have already pushed U.S. cotton exports to their highest level since 1926, putting downward pressure on world prices that now will intensify. "The problem with agriculture and textiles is that those are the sectors where the least skilled, poorest people can get a leg up," said Nancy Birdsall,       president of the Center for Global Development, a think tank that focuses on global poverty. "So when we protect those sectors, we are taking jobs away from the poorest people in the poorest countries."

The U.S. spends about $10 billion a year on foreign aid, Birdsall said, compared with the $18 billion a year that will now go mainly to large U.S. farms. "This is what we're spending on a few big farmers, versus the three billion-plus people who live on under $2 a day," she said.

The huge new subsidies are also likely to put the U.S. in violation of its trade commitments, analysts said, allowing other nations to retaliate against U.S. exports. The bill undermines the Bush administration's trade-opening agenda, reversing two decades of U.S. policy urging lower global farm subsidies as a way to increase U.S. farm exports, on which U.S. farmers depend.

In the new round of global trade talks dubbed the "Development Round" because of its focus on aiding poor nations, the Bush administration said it would push for cuts in farm protection. "The mess just couldn't be worse," said Brink Lindsay, director of the Cato Institute's free-market Center for Trade Policy. "Our credibility in pushing for agriculture liberalization is now indistinguishable from absolute zero."

The Bush administration had asked Congress for a farm bill that would emphasize conservation and market-oriented aid, but it made little effort to shape the bill, lobbyists on both sides said. The bill instead was driven by the battle for control of the House and Senate, where both parties are eager to win or hold seats in the Midwest and South.

Bush has made trade liberalization a top priority and is in the middle of a Senate fight to win authority to negotiate a new global trade pact and expand the North American Free Trade Agreement with Mexico and Canada to the entire Western Hemisphere. But analysts agreed that administration support for the farm bill hurt Bush's credibility on trade. "The Bush administration talks the talk of free trade," Birdsall said, "but it hasn't walked the walk."
 

DR.. DARYLL E. RAY:
FARM POLICY EXPERT OUTLINES
TOP TEN REASONS TO
START OVER ON A FARM BILL

The commodity portion of the new farm bill is destined to be a Super Freedom-to-Farm since it will basically take the 1996 legislation and wrap it with a method to automatically pay "emergency payments." Even though farmers despise the price and market income results of the 1996 legislation, the collective legislative response seems to be: "Let's do it again." Do we really think the results will be different the second time around? Maybe, we should just start over.

For the sake of discussion, what would be the top reasons for reconsidering farm legislation? My top-ten list would be:

1) By shaping farm policy to cause large direct payments, farmers are being portrayed by editorial writers and conservative think-tanks as politically-powerful, money-grubbing corporate welfare cheats.

2) Since farm policy is now a money game, anybody and everybody producing a food or fiber product wants to play, even for those products for which the market or existing price and income stabilization methods perform satisfactorily over time.

3) Current commodity policy is not a farm policy it is an agribusiness policy. Why? Because other farm policy approaches could generate current or higher income levels without spending tens of billions of dollars annually in direct payments. But to allow agribusiness to a) maximize sales of fertilizer, seed, and chemicals and to b) maximize volumes processed and transported requires fence-row-to-fence-row production; which means unnecessarily depressed prices; which means unnecessarily low market incomes; which means large government payments but it is agribusiness that gets the "increased" income, not farmers.

4) The cost of the new farm bill is almost assuredly seriously underestimated. The export assumptions underlying the cost estimates for the 2002 bill are very optimistic. In fact, the carnage has already begun. It is expected that farm subsidies will be billions of dollars higher this crop year because of "slow" exports --- that's billions of dollars that will not be available for funding future years of the new legislation according to the original protocol for funding a new bill. We estimate that the new legislation could easily cost $100 billion more than its $170 billion projected cost if crop exports simply follow the trend of the last 20 years.

5) Export worship continues to underpin the current commodity policy direction. Farmers want to believe and agribusinesses fan the obsession while politicians, journalists, and economists provide rationalizations as to why exports have not grown as promised. This has been going-on for about a quarter of a century. The latest excuse --- which undoubtedly is a true explanation for most products --- is the high value of the dollar. But if you look at the data in the case of soybeans and corn, no pattern of competitor exports related to relative exchange rates is apparent. For all exchange rate configurations, our competitors export every bushel produced that they do not need domestically, period.

6) There is no recognition that, when crop prices capsize, market demand does not provide a rigging to raise them back up again. In crop agriculture, a drop in price does not cause the quantity demanded to increase enough to sufficiently draw down inventories and cause prices to bounce back.

7) There is also no recognition that market response on the supply side is of no help in the search for a cure for low prices. Farmer Jones --- or his replacement, should farmer Jones go bankrupt --- will plant his crop acreage to something. That's why discussions about whether loan rates should be changed a few cents for this crop or that are akin to rearranging deck chairs on the Titanic. Viewed from the standpoint of total acreage cropped, raising or lowering loan rates a few pennies ain't going to matter much; cropland acreage will be planted to one crop or another, depressing all prices. Same is true for the existence or lack thereof of decoupled, "emergency" or other government payments.

8) While belief in market self-correction via supply and demand response to depressed prices may have been a reason to embrace the 1996 legislation, why would we want to take that dog out to hunt again this time around?

9) In addition to providing no price floor, commodity prices can soar to unexplored heights. With no real buffer stocks and super-low U.S. yields for a year or two, crop price levels could go so high and feed availability could drop so low that major domestic livestock-feed demanders and export customers would scurry to find long-term non-U.S. suppliers of corn and soybean meal. This is not a far-fetched possibility. We will have a 25 to 30 percent yield shortfall sometime. If that happened now, prices could go to levels we have never experienced. In addition, to the response by traditional demanders of feed, how do you think China, Argentina and Brazil will react? Prospective legislation needs a buffer stock policy, if no other reason appeals, to preserve existing and especially long-term export markets.

10) In addition to no authority to create buffer stocks, the Secretary of Agriculture also has no levers to affect the level of output. The Secretary needs both these authorities if farmers are to once again receive their net income from the market place rather than from the mailbox.

Starting over would not be the worst thing in the world. The reality is that most farmers have already made their planting decisions, so there is no hurry on that account. With a little extra time and the pressures of a deficit budget, it is possible that Congress might find a more cost efficient way to provide for a stable farm sector that continues to provide an adequate safe supply of food at reasonable prices and still be environmentally responsible.

Daryll E. Ray holds the Blasingame Chair of Excellence in Agricultural Policy, Institute of Agriculture, University of Tennessee, and is the Director of the UT's Agricultural Policy Analysis Center.
http://www.agpolicy.org.
 

W.W. KELLOGG FOUNDATION REPORT:
CONGRESSIONAL PERCEPTIONS OF RURAL AMERICA;
PESSIMISM, ANXIETY OVER DEATH OF FAMILY FARMS

The W.K. Kellogg Foundation [on May 3] released the results of a new study on the perceptions of rural America and public policy, "Perceptions of Rural America: Congressional Perspectives."

Interviews with members of Congress found that legislators view rural America as an incubator of traditional values but believe the absence of a strong national voice is an impediment to drafting rural policy. The study was released as part of the Stand Up for Rural America Day activities on May 6-7, 2002.

Greenberg Quinlan Rosner Research, Inc., a Democratic research firm, and Greener and Hook, a Republican consulting firm, conducted the interviews. The bi-partisan research included 26 members of Congress, including 16 Democratic House members and Senators and 10 Republican House members and Senators.

"Elected officials share the view that there is something unique and particular about rural America that deserves attention, protection, and support," said Anna Greenberg, vice president of Greenberg Quinlan Rosner Research, Inc. "But legislators express some pessimism about rural America. They are disturbed about the death of the family farm and the effect that consolidation has on ordinary farmers as well as the persistent poverty in rural communities and the difficulty of bringing economic opportunities to rural communities."

Policy makers interviewed identified that job loss and the overall lack of economic opportunities is the single greatest challenge facing rural America. A list of rural issues includes increasing resources to family farmers rectifying the inequities in the farm bill, expanding access to broadband, improving the rural healthcare system, generating incentives for industry to locate in rural communities, and preserving the rural environment emerge across ideological and partisan divides.

"We found that one barrier to effective policy making, as many legislators on both sides of the aisle point out, are the well-organized interests that exert a profound effect over rural policy making --- particularly on the farm bill --- that is not always beneficial to the small farmer and the rural economy as a whole," said Bill Greener of Greener and Hook. "The study also found that legislators feel hostage to a system that is captive to
multiple interests and programs like Food Stamps that are impossible to vote against."

"The Kellogg Foundation has had a long standing concern about the economic and social health of rural America," said Rick Foster, Vice President for Programs, W.K. Kellogg Foundation. "These interviews with members of Congress give us an important snapshot about how federal policy makers view rural America. This is the second report we have released in a series of surveys about how rural America is perceived. In the next year we hope to also complete a national public opinion survey, regional focus groups, and a content analysis of media coverage of rural America."

The first report, released last December, was based on in-depth interviews with 242 residents of rural, suburban, and urban Americans. It found that perceptions of rural America are centered on a series of contradictions:

* Rural life is more relaxed and slower than city life, but harder and more grueling;
* Rural life is friendly, but intolerant of outsiders and difference;
* Rural life is richer in community life, but epitomized by individuals struggling independently to make ends meet.

The W.K. Kellogg Foundation was established in 1930 "to help people help themselves through the practical application of knowledge and resources to improve their quality of life and that of future generations." Its programming activities center around the common vision of a world in which each person has a sense of worth; accepts responsibility for self, family, community, and societal well-being; and has the capacity to be productive, and to help create nurturing families, responsive institutions, and healthy communities.

For a full copy of the report, visit the Foundation's website at
http://www.wkkf.org
on the Food Systems and Rural development page.
 

NEW YORK TIMES COLUMNIST QUESTIONS
CURRENT "MORAL VALUES" OF THE HEARTLAND

PAUL KRUGMAN, THE NEW YORK TIMES: Remember how hard New York's elected representatives had to fight to get $20 billion in aid for the stricken city --- aid that had already been promised? Well, recently Congress agreed to give farmers $180 billion in subsidies over the next decade. By the way, the population of New York City is about twice as large as America's total farm population.

I've been a stern critic of the Bush administration, but this is one case where Democrats in the Senate were the lead villains. To its credit, the administration initially opposed an increase in farm subsidies, though as in the case of steel protection, it didn't take long before political calculation trumped the administration's alleged principles. But politics aside, maybe the farm bill debacle will help us, finally, to free ourselves from a damaging national myth: that the "heartland," consisting of the central, relatively rural states, is morally superior to the rest of the country.

You've heard the story many times: the denizens of the heartland, we're told, are rugged, self-reliant, committed to family; the inhabitants of the coast are whining yuppies. Indeed, George W. Bush has declared that he visits his stage set --- er, ranch --- in Crawford to "stay in touch with real Americans." (And what are those of us who live in New Jersey --- chopped liver?)

But neither the praise heaped on the heartland nor the denigration of the coasts has any basis in reality.

I've done some statistical comparisons using one popular definition of the heartland: the "red states" that --- in an election that pitted both coasts against the middle --- voted for Mr. Bush. How do they compare with the "blue states" that voted for Al Gore?

Certainly the heartland has no claim to superiority when it comes to family values. If anything, the red states do a bit worse than the blue states when you look at indicators of individual responsibility and commitment to family. Children in red states are more likely to be born to teenagers or unmarried mothers --- in 1999, 33.7% of babies in red states were born out of wedlock, versus 32.5% in blue states. National divorce statistics are spotty, but per capita there were 60% more divorces in Montana than in New Jersey.

And the red states have special trouble with the Sixth Commandment: the murder rate was 7.4 per 100,000 inhabitants in the red states, compared with 6.1 in the blue states, and 4.1 in New Jersey.

But what's really outrageous is the claim that the heartland is self-reliant. That grotesque farm bill, by itself, should put an end to all such assertions; but it only adds to the immense subsidies the heartland already receives from the rest of the country. As a group, red states pay considerably less in taxes than the federal government spends within their borders; blue states pay considerably more. Over all, blue America subsidizes red America to the tune of $90 billion or so each year.

And within the red states, it's the metropolitan areas that pay the taxes, while the rural regions get the subsidies. When you do the numbers for red states without major cities, you find that they look like Montana, which in 1999 received $1.75 in federal spending for every dollar it paid in federal taxes. The numbers for my home state of New Jersey were almost the opposite. Add in the hidden subsidies, like below-cost provision of water for irrigation, nearly free use of federal land for grazing and so on, and it becomes clear that in economic terms America's rural heartland is our version of southern Italy: a region whose inhabitants are largely supported by aid from their more productive compatriots.

There's no mystery about why the heartland gets such special treatment: it's a result of our electoral system, which gives states with small populations --- mainly, though not entirely, red states --- disproportionate representation in the Senate, and to a lesser extent in the Electoral  College. In fact, half the Senate is elected by just 16% of the population.

But while this raw political clout is a fact of life, at least we can demand an end to the hypocrisy. The heartland has no special claim to represent the "real America." And the blue states have a right to ask why, at a time when the federal government has plunged back into deficit, when essential domestic programs are under assault, a small minority of heavily subsidized Americans should feel that they are entitled to even more aid.
 

NEW YORK TIMES LETTER-TO-THE-EDITOR
RESPONDS TO COLUMNIST’S HEARTLAND ATTACK
"WHAT EXACTLY ARE WE SUPPOSED TO EAT ???"

To the Editor:

Since I grew up in a "red" heartland state and now live in a "blue" coastline state, I feel qualified to respond to Paul Krugman's criticism of farm subsidies ("True Blue Americans," column, May 7). Farmers, who go to work before the sun rises and work until well past sunset, seven days a week, 365 days a year, earn only pennies on each dollar they invest in their product.

Without subsidies, most farms would need to cease production (or farmers would need to live like my childhood neighbors, who on cold Minnesota nights slept in the barn because they could not afford to heat both it and the house).

If Mr. Krugman finds this an acceptable alternative, perhaps he could also solve this quandary: what exactly are we supposed to eat?

MARA D. RUTTEN
Arlington, Va., May 7, 2002
 

LEAVING THE LAND:
"THE POINT WAS FOOD,
QUANTITIES OF FOOD"

"The point was food, quantities of food. It all looked so easy, that tractor driver in his air-conditioned cab, that wonderful machine crawling across the face of the same earth it would have taken my ancestors forty years to plow. What matter if a whole style of life was gone? What matter if the earth no longer served a single family, a small parcel of immortality for the common man?

"All that was lost to me, as lost as a cherry orchard in which people no longer knew the meaning of cherries, as lost as the unwritten language of a long-expired race of men. All that mattered was food, the wheat on the hill, the hay in the meadow, the mutton under my boot. Whatever method could raise them best and most efficiently would win the prizes of the earth.

"There was little beauty to it, in my mind. There was only sweat, and maybe a certain sense of unspeakable smallness in my soul in that all the generations behind me, of all the lost tribes of my forefathers who had dug potatoes, milked cows, sown grain, picked fruit from primeval gardens, it had all come down to me in a knowledge I only wished to lose."

--- Douglas Unger, Leaving the Land (Harper & Row: New York, N.Y., 1984)
 

FARMING MEASURED BY MONEY?
TOO GOOD FOR THAT

"We were farmers, it was ours to make the farm worthwhile and be satisfied. We did not compare our lot with others. We went about our farming as the days came, the program being determined by the weather and the seasons. Nor do I recall laments about the weather; it will come out right in the end, we shall follow the Lord's will --- this was the attitude. Perhaps these practices and outlooks cannot develop the most skillful and productive farming, but farming was not a competitive business. We needed little and were never in want. We had not learned to substitute machines for men. We knew nothing about `efficiency' and cost accounting was not even in the penumbra of dreams. The men of that stripe and generation would have resented that farming can be measured by money; it was too good for that."

--- Liberty Hyde Bailey (1858-1954), Dean, Cornell College of Agriculture
 

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Readers of THE AGRIBUSINESS EXAMINER are reminded that past issues of the
newsletter can be found at the Corporate Agribusiness Research Project’s web site on
the Internet. The CARP web site features: THE AGBIZ  TILLER, THE
AGRIBUSINESS EXAMINER and "Between the Furrows."

THE AGBIZ TILLER, the progeny of the one-time printed newsletter, now becomes an
on-line news feature of the Project. In-depth essays dealing with corporate agribusiness
activities are posted here periodically.

In "Between the Furrows," besides a modern search engine, there is a wide range of
pages designed to inform and educate readers on the inner workings of corporate
agribusiness. In addition to CARP's "Mission Statement," "Overview" and the Project
director's "Publication Background," the viewer will find a helpful "Fact Miners" page
which is an effort to assist the reader in the necessary art of researching corporations; a
page of  "Quotable Quotes" pertaining to agribusiness and corporate power; a  "Links"
page which allow the  reader to survey various useful public interest, government and
corporate web sites; a "Feedback" page for reader input, and  a page where readers can
order directly the editor's The Corporate Reapers: The Book of Agribusiness.

The CARP web site was designed and produced by ElectricArrow of Seattle,
Washington.
http://www.electricarrow.com

Simply by clicking on either of the addresses below all the aforementioned features and
information are yours  to enjoy, study, absorb and sow.

http://www.ea1.com/CARP/
http://www.ea1.com/tiller/