The Vanishing Small Farmer
Part Three (in case you missed Parts 1-2, you can find them in the Archives)
Against this kind of competition, what chance does the small farmer have? He survives or fails on his crop income alone. He does not have the benefit of outside earnings, or the luxury of converting current income into future capital gains. He might wish to expand or to buy more equipment, but to do so he must use his own money, not the Treasury's. When local property taxes rise because of encroaching suburbia, the large corporation can absorb the increase as a hedge against future speculative profits. For the small farmer higher taxes simply mean a decrease in the income on which he must live. Nor can he recoup farming losses with profits from machinery, chemicals, processing, packaging or marketing. If he is not paid enough cash for his crop, he is wiped out, regardless of how profitable the other stages of food production might be.
Corporations have other advantages over small farmers, including access to credit. According to a Department of Agriculture study in 1966, corporate farmers are able to borrow nearly twice the proportion of their assets that family farmers are. Corporations also enjoy the government-sanctioned privilege of exploiting their employees to a degree unparalleled in any other industry. The federal minimum wage for farmworkers is $1.30 an hour - 30 cents below the minimum paid to all other workers. And while it is a felony for ordinary individuals to harbor illegal aliens, it is not a crime for growers to employ them. Such laws as these not only abuse farmworkers; they also hurt the self-employed farmer, who, in order to compete with the giant growers, winds up having to exploit himself.
Farming corporations receive further government aid in the form of subsidies. Among these are payments for reduced crop production. Since farmers with large landholdings are able to "not-grow" more crops than are farmers with small holdings, their subsidies are more generous. Charles Schultze, former director of the Budget Bureau, estimates the total cost of farm subsidies at $9 to $10 billion annually, the lion's share of which goes not to poor farmers, who need it, but to the corporate giants. Last year, the I. G. Boswell Co. of Calif. received federal subsidies totaling $4.4 million; Tenneco got $1.5 million; the Florida-based US Sugar Company collected $1.1 million; the Delta and Pine Land Company of Mississippi bagged $814,000. A newly enacted $55,000 ceiling will reduce some of the largest handouts this year, but the limitation has too many loopholes (for example, the ceiling is computed on a per crop and per nominal owner or lessor basis) to be effective.
Subsidies also come in the form of water, delivered to many farmers' doorsteps by federally-funded reclamation projects. The price paid by water users is well below the actual cost of delivering the water. Most of the cost of building dams and aqueducts is charged to the general Treasury and to hydroelectric power consumers.
In theory, federally subsidized water is legally barred from delivery to farms of more than 160 acres, and to all absentee-owned farms. In practice the law is widely violated, to the detriment of the family farmers it was intended to help. Thus, small farmers in California are now being hurt by the delivery of new water to lands owned by Tenneco, Getty Oil, the Tej6n Ranch, Standard Oil of California and the Southern Pacific Railroad, among others. Production of fruits and vegetables from these heretofore arid lands will soon flood the market, thereby driving down prices. Much the same fate awaits small farmers in the Pacific Northwest, where vast lands controlled by Boeing, the Burlington Northern, Utah and Idaho Sugar, and Amfac of Hawaii are about to receive federally-dammed water from the Columbia river.
End of Part Three.
The Conclusion will be published starting Thursday, November 6.
This essay is part of a series written by Peter Barnes for The New Republic magazine in 1971-72. We think you'll be pleased -- and perhaps shocked -- to see how timely and insightful the essays are for today. Each essay will be republished, in installments, by The Progress Report.
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