Farming For The Government

Farming For The Government“I don’t like farming for the government,” admitted a Minnesota wheat farmer to Time magazine in 1959. “I know it’s wrong. But it’s not for me to figure out what should be done. I have four children to take care of. As long as the government pays for it, I’ll raise as much wheat as I can.

For better or worse, in the last half of the 20th century, farmers were using government programs to stay in business. A support payment or loan often meant the difference between losing the farm and planting one more crop. Even by 1941, more than a third of an average farm’s income came from government payments. It became almost impossible to opt out of the government programs, and lobbying by agricultural organizations gained importance. Low-interest credit, price supports, conservation aid and rural electrification were all important programs. Ironically, the most important government program was an attempt to limit the amount of food farmers would produce.

Throughout much of the 50s and 60s farmers chronically produced more crops than the consumers could use. Surplus crops drove down prices, so the government tried to reduce surpluses by limiting the acres that farmers could plant in key commodities while, at the same time, guaranteeing a certain price for those commodities.

It didn’t work because farmers became more productive on the acres that were left and surpluses persisted. Farmers increased production by 2.1 percent each year in the 50s, despite government acreage limitations. At the same time, the population increased about 1.7 percent. There is a limit to how much any single person can eat. So, if production is growing faster than the population and the population is not eating more and exports are not expanding, only one thing can happen – surplus crops will build up year after year. By 1960, the federal government was paying $7.7 billion to buy up surplus agricultural products through the Commodity Credit Corporation. That kept prices from declining even further and provided farmers with income and consumers with inexpensive food.

It was only when the Vietnam War escalated and when the government began producing more food for the troops and their allies that storage bins for the surpluses were emptied for a time.

Government programs had been crucial to farming since the 1930s when the Agricultural Adjustment Administration was enacted. But the ag programs were always considered temporary measures. Year after year went on, and more and more farmers came to rely on government subsidy checks to balance their books.

Finally, the 1965 Food and Agriculture Act was passed. It was the first to explicitly state that government price supports were a permanent policy. Congress and President Johnson finally admitted that farmers were, in large measure, farming for the government.

There were some farmers who tried to avoid the programs, but they were few and far between.

Don Reeves was one of those who considered making it without government programs
film_reeves_R. “In only one year out of the 35” years that Don farmed with a partner, “did we even do the arithmetic about the possibility of staying out of the farm program. I mean that was it. There just wasn’t a question. The program was there; you took advantage of it.”film_freeman_L

Don Freeman (right) says he can see the effects of changes in government policies almost immediately. In the past, his company, Agriproducts Corporation of York Nebraska, manufactured grain storage bins. “The government announced a payment-in-kind program,” he remembers. The support payments to farmers were paid in commodities rather than cash. Without the cash, farmers couldn’t buy Don’s storage bins. “That just devastated the bin storage business. I mean, it cut this volume like in film_schrick_RTerry Schrick (left) is concerned with the fact that government are so intrusive that they know everything about each farmer’s operation. “As this thing has progressed, it don’t seem like any decisions are made without the government being involved,” he says. “By being involved with these programs, they know everything we’re doing. They know when we blow our nose.”

Written by Bill Ganzel, the Ganzel Group. First published in 2007. A partial bibliography of sources is here.

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