Between the Lines

Between the Lines By David Lias Never more than now, does it seem, has there been a "circle your wagons" mentality among agricultural producers.

Perhaps farmers have good reason to feel a bit jumpy. Yes, the presence of "corporate agriculture" seems to be growing (according to some people, that is). Yes, livestock prices have tanked this year, making survival by tilling the land and feeding cattle or hogs just that more of a challenge.

And, of course, there are meat imports from Canada, laced with things that the best farmer can't predict, like whether enough precipitation will fall on his fields in a given year, or whether his crops will be spared from hail or pestilence. The most recent bit of news that likely is striking fears in farmers' hearts is a decision by the U. S. Supreme Court Monday that struck down Iowa's "right to farm" law, which is similar to laws enacted in every other state, including South Dakota.

In other words, it seems more likely now that a farmer could be sued because his operation looks and sounds and smells like a farm, especially in this day and age when urban residents seem to be taking a liking to moving out and living in the country, in rural housing developments.

By now, it would be nice to hear some good news about farming for a change. Guess what? According to an article entitled "Why Family Farms Endure" in the Jan. 7, 1999 Investors Business Daily,

there are signs that big corporations aren't taking over the whole farm economy.

As Douglas Allen and Dean Lueck observe in the Journal of Law of Economics, farming "has largely resisted the transition to large corporate ownership."

Citing 1992 Census of Agriculture data, the authors note that "more than 85 percent of farms are organized as 'family farms.' "

Not counting small family-held corporations, "farm corporations made up only 0.4 percent of all farms in 1992, 1.3 percent of farm acreage, and generated 6 percent of all sales receipts," wrote Allen and Lueck.

Why should we care about these observations?

Well, late last year, South Dakota voters passed a constitutional amendment banning corporations from buying more of the state's farmland. Nebraska's constitution also includes a ban. And several other states have laws limiting the spread of corporate-owned farms.

These attempts to "save" family farms by stopping corporate farms are usually bad for consumers, who pay higher prices. They also hurt taxpayers, who pay billions of dollars each year to fund farm subsidies.

A closer analysis of the data studied by Allen and Lueck seems to indicate, however, that family farms, by their very nature, are much more resilient than we want to believe.

Allen and Lueck note that a major trend in the history of industry is the transition from family firms to large factory-style corporations.

Yet the independent family farm lives on. A key reason "is the peculiar seasonal nature of agricultural production and the consequent lack of continuous operations," explained C.L. Holmes in the Economics of Farm Organization and Management. "Almost every line of endeavor on the farm must depend either upon the swing of the seasons or upon the periodic nature of some biologic process.

"There are seed times and harvest times with their specific tasks which, in the main, are of short duration," he added. "There is also the case of livestock at the different stages of their development. In no case can a man be put to a single specific task and be kept at it uninterruptedly for a month or a year as is true in a factory."

We won't argue that the greatest move toward factory-corporate farming has been in livestock production. Allen and Lueck note that livestock producers have been able to reduce the role of nature by bringing production indoors to control climate and disease. As a result, except for cow-calf operations, the livestock industry is the most specialized and most dominated by companies organized in the corporate-factory form.

Such specialization isn't possible with other commodities, according to Allen and Lueck. The result, they write, is that "family farms will likely be with us for a long time to come."

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