Cheap Food and the Loss of
Farmland:
A Farmer's Perspective
MAYNARD KAUFMAN
Newsletter of the Michigan Organic Food & Farm Alliance Nov/Dec 1997 1nov97
As I approach the time of retirement and actually begin planning to sell my 160 acre farm, I find that my commitment to farmland preservation is wavering. I had always hoped to sell the farm to another organic farmer, but as farmland prices rise (9% last year in Michigan) while prices for farm products stay the same and fail to keep up with rising expenses (repair, fuel, machinery, etc.), farming may no longer be economically viable. Farm prices average below 50% of parity -what they ought to be to keep up with rising expenses. Cheap food policies are making it impossible for medium-sized family farms to get started. We like to think that the preservation of farmland will insure the continuation of family farms. But only large farmers and corporations have access to the capital needed to buy farmland. Should we preserve farmland so that corporations can continue to gain control over agriculture and food?
Actually, I have been apprehensive about the ways in which the problem of loss of farmland has been distorted and misrepresented ever since it emerged as a public issue in the 1970s. That was, we recall, the back-to-the-land decade. After the 1980 census results were tabulated, demographers were able to verify an unprecedented "migration reversal" during the previous decade. Populations in nonmetropolitan counties grew at a rate of almost 16% as compared to a rate of growth of about 9% in metropolitan areas.
This led to the furor over the loss of farmland in the 1980s with all its hyperbole and exaggeration - "Every day in the United States 12 square miles of agricultural land are converted to nonagricultural uses."' Of course it was not all paved over for shopping centers; most was simply divided into smaller tracts and sold to the new rural residents who wanted to move beyond the suburbs. And many of these were homesteaders who used the land to raise food for household use and local markets.
We must recognize that much of the farmland allegedly lost was lost only to production agriculture as seen from the perspective of the market system. We should also remember that some of the proponents of farmland preservation were motivated by business interests. They wanted to see more crop production for the export market to offset the cost of imported oil. And they wanted corn for the production of ethanol which was a money-making possibility for the likes of Archer Daniels Midland even though it produced very little, if any, net energy.
Now, some 15 years later, the issue of farmland loss is still with us in spite of efforts to preserve farmland. Here in Michigan we have PA 116, the Farmland and Open Space Preservation Program, which provides refunds of a share of property tax, depending on household income, to farmers who transfer development rights to the state for a ten-year term.
The Farmland Preservation Agreement can be transferred to another owner if the farm is intact. But if the agreement is terminated and the farm is divided into smaller parcels, the farmer must pay the last seven years of tax refunds received from the state. I signed the Agreement in 1979 and must decide whether to terminate the Agreement in 1999.
A farm auction I attended recently has been helping me to make up my mind. The real estate was being sold, and the auctioneer took bids first on the 140-acre farm as a whole. The highest bid for the intact farm was $140,000. He then took bids for the land divided into about a half-dozen parcels of various size. These bids added up to $25 1,000, and so the land was divided and sold to several' buyers. Some of these may have been, or will be, part-time farmers who can afford to farm because they have off-farm jobs. And the land is there, ready to produce when farm prices rise to make it profitable.
It is significant that the bonus received by the seller of that 140-acre farm for dividing it, about $111,000, was more than five times the amount that would have been needed to pay the last seven years of taxes, had the se I seller been in the Farmland Preservation Program. That program does not seem like an effective way to preserve farmland.
Other programs have been proposed to pay farmers the difference between the value of the land for development and the value of the land for farming, but they would have to come from private or public agencies with very deep pockets. Farmland will be preserved for farming when farm prices rise to make farming profitable. As it is now, many farmers are cash-poor and land-rich, working a lifetime to pay for their land. They see no payback until they sell the land and, it can be argued, they deserve as much as they can get.
To whom should farmers, a large percentage of whom are old enough to retire, sell their land? We have already observed that medium-sized, full-time family farmers have a hard time, given low farm prices, generating the capital to pay for land with produce from the farm. Given current trends toward corporate control and ownership of capital assets, including land, I lean toward dividing land to make it available to more rather than fewer owners. In the long run, as global warming requires some reduction in the use of fossil fuel, we will need more labor-intensive small farms which use less energy in crop production. And, as more farmers produce for local markets, I think that more small farms will guarantee our food security and revitalize our rural communities more effectively than a few big corporate farms.
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