Iowa Farms Minting Millionaires as Rich-Poor Gap Widens

[xchrom]

http://www.bloomberg.com/news/2012-10-19/iowa-farms-minting-millionaires-as-rich-poor-gap-widens.html

Pickup trucks lined a stretch of gravel road where 150 farmers mingled between 7-foot tall cornstalks and shimmering soybeans to see which of their wealthy brethren would bid on a swath of Iowa’s richest cropland. This was a farm -- table-flat and 314 acres -- so coveted that it drew three times the usual land-sale crowd.

“They ain’t making any more of this, boys,” auctioneer Rich Vander Werff barked into a microphone, his voice slicing through the rising July heat. “This is about as good as it gets.”

Thirty minutes later the bidding stopped at $14,300 an acre, more than four times the average for U.S. cropland. That meant about $4.5 million for the Schoenemans, a pioneering Iowa family that owned the property for generations.

Farmland auctions in Iowa now resemble a dressed-down spectator sport with Sotheby’s prices, a reflection of the yawning divide that has opened in some of the most bountiful stretches of rural America. Farm earnings in the state and throughout the U.S. increased at eight times the rate of nonfarm wages from 2008 to 2011, fueling resentment and straining the social fabric of places with deep egalitarian roots.

[HiPointDem]

1. interesting article.

[boomerbust]

2. Who was the buyer?

A so called corporate owned mega farm? Probably.

[MadHound]

3. There are some differences between rich farmers and other rich folks,

The biggest is that most of their wealth is tied up in land, machines, livestock and other such things. Even the richest have very little cash wealth.

Second of all, this is a huge bubble that these farmers are riding, a corn bubble. This bubble hasn't been erected by the farmers, but rather by speculators and other such financial folk. When they decide to burst that bubble, it is going to devastate farmers rich and poor across the country.

Finally, I find this resentment of farmers, who for decades have been on the outside looking in, rather pathetic. How dare they make money seems to be the underlying message of this article.

[Kindly Refrain]

5. So you like Republicans who get federal subsidies?

Most farmers are Republican.

[MadHound]

7. LOL!

No farmers, no food, understand that?

The fact is I'm a farmer as well, and yes I get subsidies. I get CRP money for about seventy acres that I put into the conservation program. On those acres I get paid by the government to grow trees and native grasses. Psst, I'm probably a bigger liberal than you are. Are you going to blindly damn me as well?

Yes, I like some of my neighbors, who are indeed Republicans, along with some Dems. I also dislike some of them as well, and they are also Republicans, along with some Dems. I'm not a bigot who judges a person solely on their political affiliation. Living and working in a rural area, you simply can't do that.

But your witty repartee ignores the gist of my post, which is that farmers who millionaires are substantially different than other rich folks. There is a huge difference between those who have land wealth and those who have cash wealth.

As far as subsidies go, I do think there needs to be some reform in the subsidies program, but it certainly doesn't need to be scrapped as some people seem to wish. Federal subsidies do two things. First, by necessity, farmers are the biggest gamblers in the world. They literally bet the farm each and every year. Subsidies help take the killing edge off of those bets. If it wasn't for subsidies, right now you would be seeing hundreds of thousands of farmers falling into bankruptcy due the summer's drought. Second, a lot of subsidies, such as CRP, help promote conservation and a better planet. If it wasn't for those subsidies, you wouldn't have organic food, and fence post to fence post planting, with no refuges for wildlife and wild nature.

You obviously have no real knowledge of real world farming, but hey, keep on promoting those rural stereotypes. You're only making yourself look foolish.

And again, no farmers, no food.

[Kindly Refrain]

8. So your whole premise

Is that farmers have the rest of us over a barrel. So we better do what they/you say. Great way to endear yourself to the rest of the world.

"Millionaire farmers received $49 million in crop subsidies even though they were earning more than the $2.5 million cutoff for such subsidies," Obama said at the news conference, citing the GAO report. "If it's true, it is a prime example of the kind of waste I intend to end when I am president," he said.

http://www.minnpost.com/politics-policy/2008/12/ag-folks-winced-obamas-millionaire-farmers-remark

I guess you don't agree with Obama. But what does he know, right?

edit:

I'd also like to add, so you need a monetary incentive to conserve land? Wow, what would you do if the government wasn't giving you free money? Sell it to some lumber company? Amazing.

[MadHound]

10. Nope, just pointing out a fact.

Hell, if farmers were getting their way, things would be a hell of a lot different, don't you think.

Nor did I say that all subsidies are the right measure. But you didn't notice that in your rush to broadbrush did you?

As far as agreeing with Obama, no, I don't agree with him on a lot of things, the lack of a public option, ongoing drone attacks, the way he is conducting the war, etc. etc. Frankly, at best he is a center right president who refuses to fight for issues much of the time.

And yes, you do need a monetary incentive to conserve land. You do realize that land is how you make money in farming. If farmers weren't getting paid to conserve parts of their land, they would plow it under and plant it. Or indeed, they would cut the trees and sell them to the lumber company. Apparently you have no clue about farming, that's obvious. Your broadbrush contention is that since most farmers are Republicans, that somehow they are evil, sponging money off the government. Guess what, the largest numbers of conservative voters are in the suburbs. You want to talk about government subsidy, take a look at the 'burbs.

[Ms. Toad]

12. As a farmer's daughter -

Thank you.

My (good Democratic) parents have now left the farm I grew up on - and when they sell the land (inherited from their parents) they will be millionaires - only because none us 5 kids were inclined to continue the backbreaking family business. As working farmers we lived just above the poverty level.

As a working farmer, my father never had the spare time and energy to engage in conservation projects that would have improved the land for the next generation. It takes more time than there is in the day to earn enough to feed a family of 5. Since retirement (at ~ age 75 about 5 years ago) he returns to the farm regularly and has reseeded the pasture across from our home place with native grasses that are better suited to life without excessive intervention (like irrigation), sectioned off the hill pasture so that cattle can more completely graze smaller pieces - both making the land more productive as well as better able to recover between grazings, engaged in innovative noxious weed control mechanisms which require fewer chemical pesticides (like goat grazing and controlled burns). Some of those were subsidized - as were some of the "regular" farming activities he engaged in during his 50+ years as a family farmer.

And, like you, we had wonderful neighbors of all political flavors.

[Frustratedlady]

6. I agree. Just the cost of seed, fertilizers, diesel fuel, etc. ties up a bunch of money.

I grew up on a farm and have a lot of friends who farm. Believe me, they are very conservative, as they don't know when they'll be forced to hold on selling their crops or even lose their crops. Sure, they have insurance, but what does that cost?

When you see those big pieces of machinery rolling over the fields, you aren't looking at $40K...you are looking at $100K+. I don't know of too many people who would work the hours, seven days/week, and get so little in return. We should be fighting to keep the family farmer, not the corporate farms.

[Kindly Refrain]

9. While we are at it why not throw a few bucks at the NRA?

The farm industry is a bastion of right wing politics. How people don't know that is frankly quite disturbing.

[MadHound]

11. Go ahead, cut all those subsidies,

And watch as your food prices shoot through the roof. Watch as free school lunch programs get cut due to those sky high prices, same with food stamps.

Yes, farm subsidies need to be reformed, but not with your style of slash and burn cuts, and especially not based on the farmer's voting record.

[jackbenimble]

13. Corporate farming yes,

but not the individual family farms. Corporate farms are evil places where the dollar rules. The family farmers I know, including numerous relatives, are good hardworking people who would dive you the shirt off their back if you needed it. So please don't label them all the same.

[Kindly Refrain]

4. Actually a lot of independent farmers are millionaires as well

They are mostly repug and get subsidies from the government. I know a farmer that drives a Range Rover get's $100,000 a year from the federal government.