It’s been a good year on farms. Reports are that it’s the best year out of the last six. It’s not management, marketing, higher farm gate prices, or trade-war victories that get the credit. That’s because government money has been fattening farmer bank accounts.,
Thanks Covid-19. You’re my hero.
Government handouts in election years are nothing new. Manna from Capitol Hill is usually a bipartisan congressional effort to remind the single most reliable voting block (subsidized agriculture, aka farmers) who’s on their side. In the past, USDA payments had to be signed sealed and delivered by the House and Senate to the presidents desk. But these days the Roosevelt New Deal-era Commodity Credit Corporation (funding that previously went to more mundane things like commodity loans, conservation, and disaster assistance) has been used as a discretionary expenditure gold mine by the president in a way no one has ever seen before. One group, livestock producers, who have always relied on cheap subsidized feed grains for their kickback, have been recipients of some of the largest cash payouts.
Small wonder polls show farmer support for Trump by a slot machine jackpot of 75%.
Grains are cheap, priced less than they cost to grow. What else is new? That’s why we have farm programs. The problem cattle, hog, and poultry finishers have isn’t feed costs but the pandemic’s disruption of labor, transportation, and slaughter operations needed to replenish grocer coolers. The inability to sell at any price — coupled with ongoing feed, labor, and interest costs — amounts to a 500-year flood of red ink for some farmers and, oh yeah, big multinational meat packers who can claim losses on their CAFO-raised livestock even though retail and wholesale meat prices they received went through the roof.
At one point this year packers “earned” the hundreds per head that cowboys lost.
With grain exports down, corn prices could be worse today except for the fact so many meat animals have remained on feed well beyond their expiration date. But huge supply disruption and lack of product movement is seldom positive for prices of any farm commodity.
Success is about being a reliable, steady supplier through thick and thin.
For grain producers a good crop with strong yields in 2019 has been the basis of Covid-19 payments they’re receiving now. According to USDA’s math, the more I grew in 2019 the more money I lost. But in some cases, like mine and some of my neighbors, crops and income were impacted not so much by low prices but high water. The river flood arrived at my farm on March 17, 2019, and didn’t leave until well after frost. That means corn planting for me and my neighbors was delayed from the usual April planting date to…never.
Not much of a crop in 2019? That makes me a loser in 2020, as well.
Grain farmers lucky enough to live on high ground have collected tens of thousands in Trump’s Covid-19 make-up payments. Those seem to come more from lost sales and the trade war than a pandemic. A rose by any other name would smell as sweet. But arguing terminology is just beating a dead horse in the hot sun of cash flow.
Any practical farmer will tell you if they get the chance to sell a dead horse, they won’t argue with the buyer on why it died or what it smells like.
China has stepped back into the market for U.S. corn and soybeans, ending one small facet of trade arguments but not the trade-worn burdensome surplus extending into this year’s harvest, which, if you believe USDA, will be another big one.
Even with crop insurance and disaster pay, there’s never a substitute for raising a crop and the cash flow that provides. Even a cheap crop. So while some collected 20, 30, 40,000 dollars or more (sky’s the limit because there was no limit placed on these presidential payments) in this latest round, my check amounted to a little over $800.
For most intents and purposes, I was an unemployed farmer through most of 2019. The numbers bear that out. Eight hundred bucks is eight hundred bucks—not too far away from one week of the emergency unemployment payments made earlier this year. Light as it was, my government handout was more than unemployed laborers and SNAP recipients have gotten lately from the non-negotiable, my-way-or-the-highway U.S. Senate and White House.
In another time or place, like under a high wire act, a safety net filled with people-sized holes would be replaced. What sets this high-flying pandemic act apart is the notable weaknesses inherent in the handling of emergencies. It’s a signature of the government we have today, filtering out wealthy from poor, creed and color from everyone else, placing the higher cuts among us on a pedestal and feeding who’s left into a virtual meat grinder of unemployment and hunger.
If you didn’t know 15 years ago that small dairies were struggling or that independent hog producers were becoming a thing of the past, then you’re likely one of those who happily chews the sausage someone else made without giving ingredients a second thought. Once in the mix we forget where they came from and who they are.
Some of us even seem to forget they ever existed at all.
In the last three years there’s been plenty of sausage to go around.
The problem U.S. agriculture faces in the future isn’t likely to be a pandemic or trade war, but the amount of money this government has granted in tax cuts, trade war subsidies, and Covid-19 aid packages. Someday sooner or later we’ll hear the honey pot is dry. No more free lunch. All signs fail in dry weather. You can’t get blood from a turnip, and all that easy money that simply showed up in bank accounts giving Trump a 70% farmer approval rating is suddenly a thing of the past. Consumers, who outnumber farmers 300 to 1, may wonder why so much was spent on agriculture with so little to show for it — higher grocery store prices, unfunded education, inaccessible healthcare, and chuckholes not just in the streets and highways but road of life in general.
Not all of us who grow the crops and feed the stock agree with the 70% majority of do-or-die MAGA farmers. Dairy has struggled with continued, steady loss during the Trump administration. Two dairies every day by one count. And ethanol commitments from the Obama administration have been raveled by refinery blend waivers granted or under consideration by Trump’s EPA. Conservation is on the ropes and input prices for things farmers buy, with the temporary exception of diesel fuel, are as costly as they’ve ever been.
A few years back when Democratic Missouri Governor Jeremiah “Jay” Nixon was faced with a Republican opponent, conservative agricultural groups appeared geared up to support state treasurer Sarah Steelman over Nixon. But then Steelman’s platform dropped the ethanol plank in favor of fossil fuels. That’s when farm groups coalesced, in some cases grudgingly, around Nixon, who won his second term handily.
Maybe that’s why one of the most conservative Trump states in the Union, Missouri, might just offer a blueprint for Biden’s win in November.
Richard Oswald is a fourth-generation farmer from Langdon, Missouri.