Banks Profit While Our Farmers Fail
When banks call in farm loans at the first opportunity, it destroys families, communities, and regional economies.
by Lisa Griffith
Bruce Drinkman is a successful organic dairy farmer who milks 50 cows with his wife, Mari, near Glenwood City, Wisconsin.
Despite his 34 years of experience, the two-year drop in milk prices and four years of drought have meant no profits or savings. Last fall they were denied credit from their bank to purchase seeds to plant 55 acres in grains and corn this spring. To continue farming they cashed in Mari’s retirement account but the farm was placed into foreclosure around Christmas. After repeated attempts to refinance the farm with other banks, farm credit services and Farm Service Agency (a division of the U.S. Department of Agriculture, or USDA) they were turned down by all, and did not even attempt to obtain bank credit this spring. Fortunately Bruce was able to obtain credit from a vendor to buy seed, and at the end of April he and Mari filed reorganization bankruptcy, the only means they knew to preserve their farm, home and livelihood.
A recent survey by the Federal Reserve Bank of Chicago indicated that 11 percent of Wisconsin farmers with existing lines of credit may not have credit extended next year; this is especially significant because of the a 56 percent decline in net farm income in 2009. Dairy farmers have received prices far below their costs of production for nearly two years. With eroding equity, many are in immediate danger of losing their farms.
Farmland is so valuable that local (but often not locally owned) banks call in farm loans at the first opportunity, destroying families, communities, and regional economies. Farms entering foreclosure are listed publicly, further devastating owners while notifying speculators and investors of chances to take advantage of distraught landowners.
Something is askew. As the number of unemployed nationwide remains around 10 percent and the USDA holds summits on revitalizing rural America, why are experienced, efficient farmers receiving ridiculously low prices for their products, forcing family members to seek scarce off-farm jobs to support them? Why are banks and USDA denying them access to credit to continue their operations? Are these institutions conspiring to close farming operations in order to give investors the opportunity to purchase their land for a fraction of its worth?
A posting on Farmland Forecast, read by farmers, agribusinesses, investors and speculators interested in agricultural land, stated that “Midwestern U.S. farmland provides investors the best opportunity…Farmland may be [cheaper] in other regions of the world, but…may not have the same soil quality, transportation infrastructure, or government that supports property rights.” When an elderly couple with no heirs interested in or able to afford the farm decides to sell; when a younger farmer sells after incurring too much debt from low prices and rising input costs, there’s probably a corporate investor ready to buy. The land may be flipped to developers when enough profit can be made or planted in commodity crops (such as soybeans and corn) used primarily for livestock feed or ethanol production.
Sadly, many people who would like to engage in farming remain landless but are forced to rent or accept tenuous land use arrangements with no guaranteed long-term security. Speculators and investors only make matters worse by driving the price of farmland out of their reach, making less land available for the profitable production of fresh, local, and sustainable produce, eggs, milk, grains, and meat.
It appears that the people who depend on their land for survival and provide us with food–farmers, ranchers, fishers and laborers–are more expendable than people sitting behind a desk trading stocks, land, and communities’ futures. The solution to this situation is two-fold. First, restructure the pricing system to be fair and just for people producing or harvesting our food. Second, require banks that received Troubled Asset Relief Funds (TARP) to supply credit to and work with small businesses (including farms) in their communities. Demand this from your government. Otherwise, when farmers are forced off their land because they can’t profit from their labor or access credit for annual inputs, who will provide us the wonderful bounty of summer–watermelon, sweet corn, BLTs, and strawberries with whipped cream?
Lisa Griffith is membership coordinator of the National Family Farm Coalition, where she also works on local food issues. www.nffc.net.
I first became interested in farm issues, when I lived in Salina, KS and was Committe Precint person for my district. There are a lot of small family farms and I saw first hand how hard they worked just to keep the family farm running. It is a good life, even if it is hard work.
We are loosing a part of American life, when we loose the family farmers. When I look around me, I feel sad because it seems like the best in America is being destroyed. We have the hard working fishermen who are loosing their living because they can’t fish the gulf of Mexico. He and his family are hurting. We have the small family farmer in the midwest who is loosing the family farm that has been in the family for generations and his family is hurting too. We have the hard working guy up north that can’t find work because the jobs are being shipped out of America and his family is hurting. America is suffering right now and frankly it looks like we have a government who is so far away from the American people that they have no idea what an American is going through these days. They stopped being our government and became an empire instead.
Are these jew banks Chrisy?
What is a jew bank?
Is it a special bank only for Jewish people? I never heard of a jew bank before. lol
seriously, I don’t believe that the Jewish people are are the rulers of the world and they are in an evil plot to destroy the White race from the face of the earth.
Some of the people who are behind what is going on with the economy are White, Black, Hispanic, Asian, and yes even some Jews work at banks. Some of the people behind the greed of corruption that has been corrupting our government for many years are White, Black, Hispanic, Asian and even some Jewish people. Why do White Nationalists have to blame everything on the Jewish people.
Like my mother who told me that her mother told her to never trust Black people which she doesn’t; I believe we are taught to hate. We don’t come out of the womb hating those who are different. Like the song in South Pacific we are taught to hate. I love musicals and the ballet and would love to go to an opening of the American ballet company in NYC. Some of us reject that message of hate and choose love. I have a choice I can allow hate to enter my heart and slowly my heart will die because the anger, bitterness and hate only destroys or I can love unconditonally even those who hate and hurt me. It is my choice to love as Jesus love. I will not join in the hate of one group of people for their religion. The Jewish faith has some wonderful teachings as does all religions. Yet, the Jewish faith has been more hate directed toward them. We Cathoics have known people who hate us for our Catholic faith, but we have not suffered as much as the Jews who suffered just because they were born into the Jewish faith. I continue to reject hate. I know White Nationalists will never understand me. My mom tells me that all the time. She will never understand me.
Garfield, we both see the disaster of having banks to big to fail, but while you the White Nationalist blame the Jews; Progressives tend to blame the large corporations. We both see the problem, but we have named a different enemy.
And who owns these large corporations?