Going to the Roots of the Farm and Food Crisis

The problem that has impoverished and destroyed farmers nearly always is that of low prices resulting from surplus production. That is also, obviously, a land-destroying problem. The only solution to that problem that can sustain the small farmers is the combination of production control and price supports as exemplified by the Burley Tobacco Growers Cooperative Association as it was reorganized in my region under the New Deal in 1941. – Wendell Berry

When something interrupts your usual flow of meals, you pay attention. The COVID-19 pandemic has had this effect on a lot of people – they encountered bare shelves in a grocery, a farmers’ market or a favorite restaurant closed, or even worse, they lost their job and for the first time had to turn to the emergency food supply or mutual aid for help. Headlines have screamed about meat shortages and essential food workers getting sick. The food system that had seemed so reliable and abundant was exposed as having major flaws and threatening gaps. Is there a solution?

For as long as I can remember (and I started farming in 1980), farms have been going out of business, the acres in farmland have been decreasing and to continue farming, most of the farmers I know have supported their farms by someone’s off-farm job. Either the farmer or someone in the family has a job as a teacher or health worker that provides health insurance and other benefits. Under relentless and steadily increasing financial pressures, dairy farmers sell their cows and turn to field crops, raising cattle for beef, or selling hay. Anything to keep the farm alive. Talented young farmers give it their all for five, even ten years—and then quit. Experienced farmers, including organic farmers, go out of business. They give up the struggle, sell what they can, and find “real” jobs. Development gobbles up farmland which has grown too expensive for a farmer to buy with farm earnings while investors with excess cash buy up the best farmland and then hire dispossessed farmers to manage it with an eye to the bottom line. The price farmers receive for crops does not cover the costs of keeping farms viable, much less the extra costs of developing and sustaining ecological, regenerative farming systems. As has become very clear during the COVID-19 pandemic, the farm crisis is not over.

Just as in the 1980’s, a brief period of high commodity prices and cheap credit in the 2010’s resulted in a debt and asset bubble. Then prices collapsed. In 2020, one third of all farm revenues will come from federal payments. Ever larger corporations have consolidated their dominance in the food sector. This has resulted in higher prices for shoppers and smaller incomes for farmers. At first this mainly hit conventional farms, but in 2017, processors started limiting the amount of milk they purchased from organic dairies and cut the price paid below the cost of production. With the COVID-19 crisis, organic dairies have not had to dump milk since their milk goes to retail sales. Even so, five years of low prices is putting family-scale farms of all kinds out of business.

Despite the shortage of farm workers, their wages remain below the poverty line.People of color and women are often trapped in the lowest paying food system jobs and many are forced to survive on SNAP payments. Being recognized as “essential” has not yet resulted in higher pay or better working conditions.

President Trump’s tariffs only made things worse. By paying out billions in compensation for trade losses, his administration made the big farms even bigger. The resulting farm consolidation has grave consequences for the environment and for climate change as well. The 2018 Farm Bill (the package of legislation that sets US farm policy as well as nutrition programs for five years) barely touched the structural and fairness issues that led to this ongoing disaster for family-scale farms and the food security of this country.

Parity, Price Supports and Supply Management

In 1979, the year I started farming, cavalcades of farmers on tractors drove to Washington, DC, some burning vegetable oil they had produced themselves as fuel. They went to protest against a major change in food and farm policy – a departure from parity with price supports and supply management.What was that all about and how is it relevant today?

In 1933, in the depths of the Great Depression, so many family farms were going bankrupt that the federal government stepped in to help them avoid eviction and to increase prices for their crops. The Agricultural Adjustment Act (AAA) declared an economic emergency “being in part the consequence of a severe and increasing disparity between the prices of agricultural and other commodities,” justifying action as being in “the national public interest.”

To resolve that disparity, the AAA established the parity system of pricing and supply management to reestablish farmers’ purchasing power, taking the years just before World War I as the base period when the proper balance existed between farm earnings and the prices that farmers had to pay for inputs and equipment. Retail prices to consumers were also pegged at the same proportion of consumer income as during those pre-war years. To raise prices for farm products, the AAA reduced the oversupply by setting limits in the form of marketing quotas on the acreage farmers could use for basic commodities: wheat, cotton, field corn, hogs, rice, tobacco, rye, flax, barley, grain sorghums, cattle, peanuts, sugarbeets, sugarcane, and potatoes. Conservation practices were required on the land that was taken out of production. The Secretary of Agriculture was also enjoined to let the president know if imports threatened to reduce prices to US farmers. That first year, some crops were even plowed under. There were also marketing agreements that controlled the quantity, quality, and rate of shipment to market, effectively limiting production of some fruit and vegetable crops. Farm income in 1935 was more than 50 percent higher than farm income during 1932, due in part to these farm programs. Although agribusiness successfully brought suit against the first version of this parity system, the revised approach set up by the Soil Conservation and Domestic Allotment Act of February 29, 1936 proved more durable and lasted through the 1960s.

Farmers were free to participate or not, and could disapprove marketing quotas. County committees were established to provide a forum for local referendums by commodity. These county committees still exist and hold elections every year among farmers who are participating in government programs. In some parts of the country, these committees work well. In others, they have been the source of racist decisions such as providing operating loans to white farmers in the spring when farms need start-up money, but not paying black farmers till August, or policies that discriminate against farmers who use organic methods, refusing disaster payments because the organic farmers did not use chemical protectants for crops.

In A Short History of Agricultural Adjustment, 1933 – 1975, a group of US Department of Agriculture researchers summarized the benefits of parity: “For over 40 years, price support and adjustment programs have had an important impact upon the farm and national economy. Consumers have consistently had a reliable supply of farm products for a smaller proportion of their income than anywhere else in the world. Farmers have been assured of at least specified minimum prices for their products. The legislation and resulting programs have been modified to meet varying conditions of depression, war, and prosperity, and have sought to give farmers, in general, the opportunity to attain economic equality with other segments of the economy.”

If this system worked so well for family-scale farms, why did it come to an end? According to Mark Ritchie in The Loss of Our Family Farms: Inevitable Results or Conscious Policies?, from 1945 through 1974, a consortium of agribusiness, banking, and university leaders deliberately set out to eliminate parity with policies that cut farm prices to drive excess “resources” (that is farmers and their families) out of the countryside. By the mid-1970s, farm prices were dropping and farm numbers decreased rapidly. The loss of farms and farmland continues today.

With its combination of subsidy and emergency payments to commodity farmers along with crop insurance, the latest Farm Bill enshrines cheap food policy with low farm prices that mainly benefit the biggest agricultural corporations. Until the early 1970’s, those corporations had to pay farmers decent prices in the marketplace. Farm earnings today would be very different if parity pricing levels were still in place. According to the National Agricultural Statistics Service (NASS), the parity price for 100 pounds of milk in May 2019 would be $52.80, and a bushel of corn would be $13.20. Instead, conventional farmers actually got $18 for a hundredweight of milk and $3.63 for a bushel of corn. The low prices are also the driver of overproduction.Unlike manufacturers of other products who reduce production when prices drop, farmers increase the amount they grow to try to capture the slim margins to cover their fixed costs.

Data developed by Brad Wilson, Iowa farmer and champion of farmer justice

Taxpayers have been covering the costs of cheap food since the 1970s, while the corporate buyers who purchase most of these crops make out like bandits. When food campaigners blame farm subsidies for the woes of the food system, they are missing the mark. The subsidies purportedly compensate for constantly falling farm prices, but function to just barely keep smaller farms in business, enable larger farms to get even larger, and do not make up for the market prices that farms received under the parity system. This adds up to a major transfer of wealth from farmers and the public to the likes of Amazon, Walmart, Tyson and Archer Daniels Midland.

21st Century Parity and the Green New Deal

Since the 1996 Farm Bill wiped out the last traces of the New Deal system (except for sugar): for twenty years or more this set of policies has been deemed too unlikely to gain any traction in Washington. Only a few farming organizations, in particular the National Family Farm Coalition and the National Farmers Union, have doggedly continued to demand a return to parity and supply management. In a great reversal, the Green New Deal resolution from Senator Ed Markey and Congresswoman Alexandria Ocasio-Cortez has made it “realistic” once again to consider these root solutions to the food and farm crisis.

Under a parity system with price supports and supply management, the higher market price on a set amount of production stops farmers from over producing and provides an economic incentive to use the most ecological and efficient practices. Iowa farmer George Naylor explains the inherent logic of a parity system: “When a farmer is given a quota that sets the limit of whichever storable commodity can be marketed or fed to livestock on the farm along with a parity price, the incentive to produce as much as possible with whatever technological inputs and neglect of the land disappears. The new logic would be to produce only the quota, and spend as little as possible on inputs, and engage in as much conservation as possible.”

While we can learn a lot from the strengths and failures of the original New Deal (especially in regard to farmers of color), we will have to design a new version for the twenty-first century. That is what the From Disparity to Parity coalition has set out to do with its call “to mandate fair pricing and update supply management to build a racially just, economically empowered and climate resilient food system.” Led by the National Family Farm Coalition, this initiative includes farmers, both organic and conventional, the Federation of Southern Cooperatives, the Institute for Agriculture and Trade Policy, Food and Water Watch, and researchers from several universities “united by a commitment to farmer, worker, land, food and climate justice, racial equity and wellbeing for all.” The central goal of this campaign is to build on the momentum of the Green New Deal to transform the fundamentals of US food policy and reshape the 2023 Farm Bill.

The Disparity to Parity campaign takes as given that a Green New Deal for food and agriculture must prioritize racial justice and equity in the safety net it provides for farms. It could also create a space for a highly participatory public process where groups of stakeholders all over the country hammer out the details. On a much smaller scale, that is what took place in the 1990s to launch the National Campaign for Sustainable Agriculture. I helped Alison Clark, founder of the NY Sustainable Agriculture Working Group, organize five regional hearings around New York State where hundreds of farmers and activists brainstormed and formulated recommendations. These were then combined with similar reports from meetings in other states into a program for a more sustainable agriculture. Through two years of brainstorming and discussions among food system stakeholders, the HEAL Food Alliance has created a platform that could serve as a first draft to help get the Green New Deal’s food and agriculture ball rolling.

To create a just transition out of our calamitous current conditions and to revitalize rural economies, family-scale farms need a system of fair pricing — prices that cover the real costs of living and farming, including conservation practices that regenerate natural resources. Growing food justly and sustainably is more expensive than industrialized chemical farming. Instead of driving down the costs of farming to make food cheap enough for urban workers to buy on stagnating wages, wages need to go up so that all workers must make enough to afford food that’s produced sustainably. Consumers must be able to pay for the knowledge embedded in, and carbon sequestered through, low-input, sophisticated agroecological farming using renewable energy on farms run by all those who want to work the land. And of course, farmers and farm workers, too, must be paid fairly and appreciated for their work.

Twenty-first century parity should provide price supports and supply management for the basic commodities and also be extended to other crops, the fruit and vegetables that Farm Bill language calls “specialty crops.” Since these crops are perishable, investments must be made in value-added enterprises, farmer or worker-owned coops in every county where these crops are grown. At the height of harvest time when everybody has ripe tomatoes and the excess supply lowers prices, the fruit and vegetables would be frozen, canned or dried, or made into products that can be stored for use year round. Investing in local and regional processing would stimulate local economies and provide many jobs. In place of large-scale Confined Animal Feeding Operations (CAFOs), investments in decentralized animal slaughter and processing would open up opportunities for new farmers and allow family farms to diversify again into integrated farming systems that include livestock and more diverse crop rotations. Integrated systems with more biodiversity are more flexible and resilient, reducing the pressure for routine antibiotic use while improving the quality of the meat, milk, and eggs. If they produce less meat than CAFOs, that will be better for the planet and for a population that eats more fatty meat than is healthy.

Reforming the contracts that farmers receive must also be part of a parity system. Farmers that sell to bigger entities need legislation to protect their rights to freedom of association so they can form groups or cooperatives to strengthen their bargaining position in negotiating fair contracts without threat of retaliation. In addition, a limit must be set on the middlemen’s share of the final shopper dollar: if prices go up, middlemen must pay farmers more; if the prices processors pay to farmers go down, the final point of purchase price for shoppers should also go down.With control by mega-corporations an ever greater threat to family-scale farming, the Green New Deal must be linked with anti-trust measures to halt mergers and start dismantling the big conglomerates.

Measures that are essential to establish farm work as a respected and fairly compensated profession must accompany a parity system. Like farmers, farmworkers need freedom of association so that they can form groups or unions to negotiate fair pay and working conditions. If farms are guaranteed prices that cover their costs of production, farm earnings will be high enough to pay farm workers time and a half for overtime over 40 hours a week like workers in almost every other sector of the economy.

And since farm worker advocates and department of labor staff agree that over 60% of farm workers on US crop farms are undocumented, there must also be immigration reform based on human rights to prevent the separation of families and provide a path to legal status. Farm workers should have the option of citizenship if they want to remain in the US or freedom to come and go across the border to visit their families back home.

Parity pricing will mean an end to “cheap food,” and that’s only thinkable in tandem with the end of cheap work. A coalition that brings unions and the urban anti-hunger lobby together with the parts of the farming community that embrace agroecology could make this happen. To prevent the food insecure from being hurt by fair prices for food workers, funding for food assistance must also increase.

The challenge we face now is to pull together a big enough movement of farmers, farmworkers, labor unions, environmentalists, faith communities, youth, and rural and urban activists of all kinds to transform the climate emergency to which the pandemic is linked into an all-out campaign to save human life on this planet and push through policies to eliminate the inequities and injustices of our time.

Just as during the original New Deal, we live in a time of incipient fascism, racism, and class conflict. The parity system of the Green New Deal can learn from its predecessor’s successes and failures. New Deal parity provided a dramatic economic shift in rural America, though not as thoroughgoing as we might have wished, nor as long-lasting as we would have liked, nor as egalitarian as it should have been. Yet it did show how environmental protection and paying people fairly for their work might go a long way towards limiting the power of corporations and creating a fair and ecological society where working people enjoy control over the fruits of our own labor.