Tuesday, July 31, 2007

Comments on context...

Farmers have long been fed a constant stream of data without reference points for making comparisons.

For example, a few farmers can remember the value of all US ag exports (Choose one)
  1. $38B
  2. $69B
  3. $147B
  4. $23B
The correct answer is #2 (2006). For bonus points: What was the ag trade balance in 2006? (answer below)

But I have never - in 15 years of asking this question - gotten any answer to this question:

What is the value of all US exports? (Choose one)
  1. $1.4T
  2. $8.7T
  3. $232B
  4. $678B
[Answer below]

The reason farmers focus on exports and not imports, and certainly not total exports, is because we are taught to believe America is all about farming. When the numbers don't support that conclusion, we just don't mention them. As a result, we have a lot of producers who believe agriculture is actually important in our trade picture, when it is actually just a small contributor.

Ag exports contribute about 5% of US exports. And with a trade balance of just +$4B really don't affect our overall trade balance significantly.

I have also noted when I mention these facts, some producers get upset. I'm not sure if they think they are secret, and I am spoiling the illusion or what. But these are the numbers - and they are not made up.

What is our problem with reality and with seeing ourselves as a small part of a larger economy?

Why does the spotlight have to be on farmers?

2006 Ag trade balance = $4B
2006 Total exports (goods and services) = $1.4T
I feel safer already...

You see a sign on a building in a national capital and it looks like this:
Welcome to the Irish Department of Defense.

But my favorite is the
new Japanese symbol.

Who needs an angry bird with pointy sticks?
How to pass a farm bill...

In order to get Dems to sign off on the farm bill, Speaker Pelosi and her allies threw in quite a handful of goodies - one of which may come back to haunt the farmers who like the current subsidy scheme.

Democratic leaders did it by playing Santa Claus. To representatives from California and other states that don't grow the types of crops that traditionally get federal handouts, they doled out $1.6 billion for specialty crops such as vegetables and nuts. To the Congressional Black Caucus, they handed at least $100 million to help settle discrimination lawsuits by minority farmers. To urban liberals, they gave a needed expansion of the food stamp program. And to Democrats in farm states, they presented a bill that keeps in place all of the trade-distorting subsidies that made the 2002 farm bill a shameful violation of international agreements. [More]
But the real eyebrow-raiser was this bone for labor unions:
The bill is flush with subsidies to produce ethanol, the corn-based alternative fuel that still can't compete on a free-market basis. More ethanol requires more biorefineries. Democrats plan to mandate Davis-Bacon wages for workers building those refineries. With nonunion builders unable to compete on price, each new refinery could cost as much as 35% more. In many rural areas with little or no union activity, this artificially high labor cost could even make the prospect of building an ethanol plant a net loss. [More]
This is no problem if your ethanol plant is already up and running, but bad news for expansion plans.

We seem to be risking a lot for a $25 DCP.

Monday, July 30, 2007

Something good from Katrina...

Lowes is selling "Katrina cottages" for what looks like pretty reasonable prices. Sure, by the time you add in the "not included" stuff it will be more expensive, but they are not bad looking little houses.

Good place for the in-laws when they visit, f'rinstance. And a darn sight more economical than the infamous Katrina trailers.
I dunno - it was just cool...

Watch the guy with the paint roller.
Another reason used corn heads will be hard to find...

Margy Fischer, Farm Journal's Machinery editor, discovered this summer used corn heads are hot items in farm country as southern farmers gear up for corn instead of rice and cotton.(Read more about it in this summer's issue)

Looks like that market won't be cooling off soon. The WTO has issued a temporary ruling that could hardly be called unexpected.
The World Trade Organization largely ruled against the United States in an interim decision that it has failed to scrap a series of what the trade body says is illegal subsidies paid out to American cotton growers, U.S. and Brazilian trade officials said Friday.

The interim ruling was handed out confidentially to the parties late Friday. A final verdict, expected in September, could open the door for billions of dollars worth of Brazilian trade sanctions against the United States.

WTO panels rarely change their findings between preliminary and final rulings, and the apparent result is a major victory for Brazil's cotton industry and West African countries that have claimed to have been harmed by the American payments. [More]
I would guess the prevailing sentiment in cotton country in suppressed panic, but the House vote on the new farm bill preserves much of the disputed payment scheme supported by the cotton industry. Still with the massive shift in acres, one has to wonder if deep in their hearts cotton growers are not reading some handwriting on some wall somewhere.

The ruling offers another justification for a farm bill veto, something now slightly more thinkable. Certainly many non-farm sectors are dismayed by the adoption of what are now clearly trade obstacles.

The decision of most farmers to ignore possible WTO ramifications implies a growing ambivalence to export markets, especially for corn farmers - the largest single group. Heck - we'll just turn it all into ethanol, a seemingly endless demand source.

But corn is the only commodity with that luxury, and as nations retaliate legally, our choices of what we grow will dwindle to one. And once that happens, there will be few ways to adjust to rising input costs. By focusing on only one customer, we could discover what thousands of WalMart suppliers have: we have forfeited the control of our own business.

Sunday, July 29, 2007

What do these foods have in common?

They are all what 120 calories look like.
I only look 58...

Take this "real age" test. I found it to be a real encouragement for a healthy lifestyle (and moderate drinking - yippee!)

In fact, I going to have a beer to celebrate.

[via Presurfer]
The New Transparency...

Along with pictures of Britney Spears and reports of drunken astronauts, the proliferation of video equipment and Internet sites has crossbred into a information monster that touches even agriculture.

Oddly enough, privacy is assaulted from both sides, as the left seeks to uncover corruption (EWG) and the right conspiracy (warrantless wiretaps). It's just so easy to do these days. No wonder libertarians are enjoying an unaccustomed moment in the sun.

How fast the sense of surprise wears off is anyone's guess, but there may be lasting effects we cannot fully appreciate right now. Consider this documentary, Slaughterhouse done very matter-of-factly by The Beeb. The graphic, albeit accurate depiction of meat processing is difficult to watch, but compelling at the same time.

Is is possible that, like the workers themselves, viewers will gradually react less to such footage as it becomes more available? I think that could be the case, rather than a groundswell against meat-eating. Perversely, groups promoting such depictions could be desensitizing rather than awareness-raising.

Carnage certainly has not grossed out movie-goers or game players, why should they react any differently to the food industry?
Still time for us...

In an act of extraordinary courage, author David Shenk returns to a book he wrote all the way back in 1997 - almost the Dawn of Time - to critique his predictions about the Internet.
Rereading the book 10 years later has been gratifying and humbling. A number of its ideas are, I think, more relevant than ever, while other passages come off as exaggerated or shortsighted. The premise still holds, and thankfully no longer requires much convincing: In our work, home, and social lives, we are saturated with data and stimulus. While our grandparents were limited by access to information and speed of communication, we are restricted largely by our ability to wade through it all. As with calories, we must work constantly to whittle down, prioritize, and pick out the choice nutritional bits. If we don't monitor our information diets carefully, our cerebral lives quickly become bloated. Attention gets diverted (sometimes dangerously so); conversations and trains-of-thought interrupted; skepticism short-circuited; stillness and silence all but eliminated. Probably the greatest overall threat is that so many potentially meaningful experiences can easily be supplanted by merely thrilling experiences. [More]
Aside from being a thoughtful exception to the rare appearance of accountability, Shenk's words can be still be in time to be useful for many of us in agriculture.

For technical, economic and social reasons, many trends and gadgets that take our culture by storm often require another few years (5-6 b my rough estimate) to become part of our rural lives. For example, think about when your family and friends were using cell phones, and when you finally slapped one on.

Likewise, the constant connectivity Shenk describes is still relatively rare in the country.

It will come soon, I believe. And if we choose to do so we can benefit from this adoption lag in several ways. First, the gadgets will be cheaper. We will have a wider choice. The bug will largely have been frustratingly worked out be the pioneers.

But most of all, we can make better choices about how to allow the gadget to change our lives and values. By observing change effects in other lives, we can at least pause on the brink and jump with a little more aim and purpose.

Saturday, July 28, 2007

But will they vote?...

An interesting poll conducted on young people (18-29) and some stark results.
The problems with the Republican brand among young people run deeper than Bush.
Young people are often cynical about politics, but believe in government. By a 68 – 28 percent
margin, voters would rather have a bigger government providing more services over a smaller
government providing fewer services. Even Republican young people prefer a larger, more
generous government (57 – 40 percent for bigger government with more services).
Young people adopt views diametrically opposed from the Republican Party on issues
as diverse as the war, global warming, gay marriage and, to some extent, illegal immigration as well. In fact, there is not a single issue in this survey where younger voters line up with the
Republican Party. [More]
Perhaps those of us who believe in smaller government are the dinosaurs of our time.

[via Daily Dish]

Thursday, July 26, 2007

This could be the biggest farm story today...

Hats off to the hog industry in North Carolina. Legislation there will phase-out open hog manure lagoons. While this will be expensive, by sitting down together, hog producers will be able to get up to 90% of the cost picked up by government, and one of the biggest impediments to maintaining our hog industry will be diminished.
In 2000, pork butchers Smithfield Foods Inc. and Premium Standard Farms Inc. agreed to pay $17.3 million for research on new ways to handle the waste. Last year, researchers at North Carolina State University offered five alternatives that did reduce ammonia and pathogen emissions but were up to five times more expensive than a lagoon system.

The new legislation creates a cost-sharing program for farms that agree to convert to the new technologies. For the next five years, the state will cover 90 percent of the cost, or up to $500,000 for each applicant. The state share drops to 80 percent in 2012 and to 75 percent in 2017.

The hope is that the cost will drop as the systems are improved and demand for them grows.

Justice said she has fielded numerous calls already from farmers interested in the program and companies that believe they can develop still more systems that will meet the new standards.

"The market is wide open," she said. "(Farmers) are ready to go." [More]

If other states don't use this as a template, I will be very surprised.

Well done, indeed. Our current methods of manure handling border on indefensible.

Wednesday, July 25, 2007

Tell me about it...

Maybe the weather is screwy for a reason.
More rain and snow is falling in Canada, Britain and northern Europe, two-thirds of which is attributable to human activities. Britain is suffering one of its wettest summers ever, with severe flooding in England. More rain is also falling in areas immediately south of the equator including Brazil, southern Africa, Indonesia and Australia. Nearly all of this is caused by mankind. But countries immediately north of the equator, in Africa, India and parts of China, are getting less water. [More]
(Be sure to follow the link to a helpful map)

Meanwhile, the sun is quiet. A little too quiet...
While sidewalks crackle in the summer heat, NASA scientists are keeping a close eye on the sun. It is almost spotless, a sign that the Sun may have reached solar minimum. Scientists are now watching for the first spot of the new solar cycle to appear. The 11 year long solar cycle is marked by two extremes, solar minimum and solar maximum. Solar minimum is the period of least solar activity in the solar cycle of the sun. During this time sunspot and solar flare activity diminishes, and often does not occur for days at a time. [More]
And if you've been wondering like me, where are all the forecasted hurricanes?
Though hurricane season begins on June 1, the stormiest months tend to be August and September, when conditions in the Atlantic basin are most ripe for a hurricane to develop. During these months, ocean temperatures are warmer and there is typically less wind in the upper atmosphere to shear the tops off of developing storms.

Some seasons have seen unusually late starts. The 1992 season, for example, didn’t start up until August. And boy did it start with a bang: Hurricane Andrew decimated South Florida. [More]
Could it be weather guys enjoy the media coverage so much, they are taking a page from the Homeland Security Dept. who seem to be making ORANGE as low as we'll ever see? Try to imagine who would have the guts to lower it to green, for example.

All I want to know is why we can't get as similar 5-day forecast on Friday as we get Sunday. These weekend price plunges are bumming me out.
Master of the House...

Jan and I have been huge fans of Hugh Laurie for years. In fact, we were astonished when he began the role of House - we had never seen him in a drama. But if you want to see what he can do with pure comedy, check out this.
The rest is hysteria. In time, this would mean Jeeves and Wooster, with twitchy Laurie as the twit and Fry as the heroic valet, but the purest expression of Fry-&-Laurieness is now available for your ravenous consumption in the form of A Bit of Fry & Laurie—The Complete Collection ... Every Bit!, which gathers every superlatively clever, terrifically asinine, and absolutely inexplicable moment from the four seasons of their BBC sketch show. Its 13 hours are a monument to the comedians' moment of love at first sight—of discovering someone else who took silliness very seriously. Just look at the facial hair they glued on to inhabit their hundreds of clowns over the years. [More]
For my money some of his best work was with Rowan Atkinson in Blackadder. Also we recommend Jeeves and Wooster. The man is a genius on the stage.
Don't forget where you parked...

[via Presurfer]
When local is worse...

Part of the new intuitive, agrarian approach to food may fail the test of simple mathematics. The local food movement derives legitimacy in large part from the seemingly obvious merit of food traveling fewer miles. Except it likely travels those miles very inefficiently.
But a gathering body of evidence suggests that local food can sometimes consume more energy -- and produce more greenhouse gases -- than food imported from great distances. Moving food by train or ship is quite efficient, pound for pound, and transportation can often be a relatively small part of the total energy "footprint" of food compared with growing, packaging, or, for that matter, cooking it. A head of lettuce grown in Vermont may have less of an energy impact than one shipped up from Chile. But grow that Vermont lettuce late in the season in a heated greenhouse and its energy impact leapfrogs the imported option. So while local food may have its benefits, helping with climate change is not always one of them. [More]
Local food of course has other valuable attributes: freshness, taste, uniqueness, etc. And the market can value them with consumer input. But claims of greenhouse gas emission reduction need some real numbers.

[via Free Exchange]
Redecorating made easy...

Just do the light switch plates.

[via MeFi]

Looks like history to me...

The unfolding farm bill drama ratcheted up significantly today as Republicans suddenly showed up and Sec. Johanns issued a mid-level veto threat. The trigger appears to be a poorly disguised tax built into the legislation to fund the general Santa-Claus economics of the House Ag Committee version.
A proposal from Democratic Rep. Lloyd Doggett would help pay for $4 billion in nutrition and food stamps by taxing U.S. plants of companies owned by firms located overseas. Republicans charge the increase would endanger tax treaties and raise the cost of doing business in the United States. [More]
Well, hush my mouth - Congressional conservatives are trembling on the brink of fiscal prudence and slightly smaller government. Will wonders never cease? Some conservatives are even pushing the Kind-Flake alternative (my choice, as well - the true Kiss of Death).
The conservative Club for Growth interest group is planning to include the vote on the Fairness in Farm and Food Policy amendment in the group's 2007 congressional score card. The Club for Growth calls the bill supported by House Agriculture Chairman Collin Peterson and House Speaker Nancy Pelosi "disastrous." The club will distribute the score card to other members of Congress and the public. [More]
As we learned with former Speakers, control of the gavel counts for about 150 votes on its own. Regardless, this looks like a campaign issue for conservatives either way it goes, if they bother to take a stand. The real wild card is the veto threat. After the vote count on the Kind-Flake amendment, we might know if Pres. Bush has any leverage.

Great - I'm on the road during this whole kerfuffle. I'll be at the Commodity Classic in Maryland tomorrow.

Tuesday, July 24, 2007

Listen to the music...

As a father, I have struggled to comprehend the differences between my sons' views of Life and my own (the correct one, of course). Perhaps theirs is a result of heeding the words of Alan Watts.

[via DailyDish]
Payment limits in IL...

Two outstanding articles (here) (here) in the Springfield (IL) Journal-Register regarding payment limits.

A sample:
Nowhere in their Internet biographies do Vorreyer or Thoma say they are farmers. But they both have collected hundreds of thousands of dollars in federal farm subsidies, money that isn't supposed to go to anyone who isn't farming.

Since 2000, taxpayers have given Vorreyer more than $1.4 million in subsidies, according to federal databases. Thoma has collected more than $655,000 since 2000.

The law says subsidies aren't supposed to go to anyone who isn't "actively engaged" in farming, and that means more than buying fertilizer and hiring folks to do the work.

Taxpayer money has flowed to Thoma and Vorreyer largely through corporations called MV Inc., which has Vorreyer as its sole shareholder, and A&M Inc., which is owned equally by the sisters, federal records show. The sisters also collected nearly $600,000 between 2000 and 2005 via J.C. Dowson Inc., a corporation they own with their brother, John.

You get the drift - another story of gaming the farm program. The reason I noted this was the comments section. Many were outraged at the idea of rich people getting government checks meant for deserving farmers.

Also present were strongly defensive comebacks by (presumably) farmers. Their arguments in favor of continued subsidies fell into predictable categories.
  • Farmers have to work harder than other people and have no control over their economic circumstances.
To all you who say end all subsidies, have you ever tried to operate a business where all of your inputs are purchased on the retail market and sold on the wholesale market? If you have then you have farmed. If you haven't then you don't know what it is like to pay $200+ for a bag of seed corn, or $550 for a ton of fertilizer and pray that the bottom doesn't fall out of the market so that you can make all your operating and land loan payments. When you have done that then you have farmed. The big boys may be getting a little bit extra, but they have simply found a way to work the system, and anyone in business knows that if you can work the system better than your competitor then you are going to make more money, ina world where money is king.
  • Farm subsidies make food cheap. (AKA - "without us you'd starve")
To those of you who think that farm subsidies should be ended, remember what you wished for when over 25% of your income goes toward feeding your family. There should be a limit on payments, but this country has a cheap food policy for a reason, and that is to keep the 95% of you folks that couldn't grow a blade of grass from starving to death. A strong agriculture economy is the backbone to our country's survival.
  • Oh yeah, well you can go #$%&*##$
Yesterday's farm story had its comments disabled because the bulk of the comments we were receiving violated the decency guidelines we have in place.
I mention this because the power of the first two arguments - which are totally without substance - grips many in agriculture. This used to bother me until I realized those who embraced them most fervently usually were unlikely candidates for long-term professional survival.

Maintaining beliefs that do not correspond to reality requires immense effort, and eventually falls short (hence, I believe the anger). We have done a great disservice to such people by allowing their fatuous disengagement with truth to go unchallenged in the name of comity.

[Thanks, Chris]
Wait 'til Ken hears this...

When we were shooting the video segments of the Farm Journal Corn Navigator series, agronomist Ken Ferrie was trying to convince me that earthworms drag surface residues into little "condominiums".

I am not making this up - ask him! Or watch the video when we post it.

Anyway, between Ken and Jan I have been thoroughly indoctrinated into deep reverence for earthworms. Only to read this sad science report from Germany:
"We have concentrated on getting waste out of landfill and into worm composting systems but they can actually produce more greenhouse gases than landfill sites produce," Frederickson told Materials Recycling Week, a leading publication for the recycling and waste-management industry. [More]
It seems the slimy dudes produce nitrous oxide - which is a tremendously powerful greenhouse gas.
"The emissions that come from these worms can actually be 290 times more potent than carbon dioxide and 20 times more potent than methane. In all environmental systems you get good points and bad points."

This is because worms used in composting emit nitrous oxide - a greenhouse gas 296 times more powerful, molecule for molecule, than carbon dioxide.

Just great - now earthworms are killing the planet.

Those Germans just love to break bad news I think.
Great poetry for sensitive farmers...

I have noted before that one difference between farmers and cowboys is our literary tastes. Cowboys write poetry; farmers recite limericks.
The Raven

There once was a girl named Lenore
And a bird and a bust and a door
And a guy with depression
And a whole lot of questions
And the bird always says "Nevermore."
[via MeFi]
Only in Japan...

You might know an act of vandalism begun by drunken Brits smashing wheat down with poles has been turned into a
precision art form by the Japanese. The pictures are created by "growing a little purple and yellow-leafed kodaimai rice along with their local green-leafed tsugaru-roman variety".

[More] [More]

[via Boingboing]

Monday, July 23, 2007

Lose the outrage and get real...

How conveeeenient - a GAO report on payments to dead farmers smack in the middle the farm bill debate.
The Agriculture Department sent $1.1 billion in farm payments to more than 170,000 dead people over a seven-year period, congressional investigators say. [More of a rather formulaic story]
Some good questions to ask when you see articles like this.
  1. How much total money did the FSA hand out during this period? If we do a rough estimate of $20B per year, then the dead guys got about 0.7%. In other words, 99.3% of these funds were NOT dispersed to dead people.
  2. How does the above compare to other welfare programs of government (SS, Homeland Security, etc.)?
  3. How much are we willing to spend in staff, auditors, investigators, etc. to recover that $1.1B?
  4. Have you ever tried to close an estate in 2 years? I have and it's like trying to kill a zombie.
Of course, the obvious answer to this outrage: don't pay dead people; don't pay live people.
But wait, there is more...

The arch-nemesis of lovable farmers who just want a few billion on subsidies to tide them over - Big Business - has stirred from its loathsome stupor. (I get all carried away with metaphors after a little caffeine).
In the hubbub surrounding the markup, few noticed some important news: The U.S. business community came out for reduced agricultural subsidies.

In a letter to House and Senate leaders, it called on Congress to “enact long-needed reforms” in farm policy that will “create a dynamic opportunity for U.S. trade negotiators to increase the pressure on our trading partners to offer substantial new market access opportunities that would benefit American farmers, manufacturers and services providers.”

It was signed by several of the biggest guns in corporate America, including the Business Roundtable (representing Fortune 500 giants), U.S. Chamber of Commerce, National Retail Federation, National Association of Manufacturers and Information Technology Industry Council. [More]

And even worse those despicable number-cruncher/publishers at EWG have had the nerve to point out the proposed payment limits would only affect about, ummm 27 recipients or so.

Could it be that Karl Rove once again has a better political sense of the nation than Speaker Pelosi? Like others, I think "farm states" will not be politically decided by the farm bill.
In 2005, a Kellogg Foundation-sponsored poll conducted in Iowa, Kansas and Minnesota found clear preferences for a strict $250,000 cap on farm program payments, which is the proposed cap in the Dorgan-Grassley bill reintroduced two weeks ago. All three states are considered farm states, and both farmers and non-farmers were surveyed. You can find the poll here. A quote from the poll summary:

[By] more than a two-to-one margin (67 percent to 31 percent) voters in these states support limiting direct payments to single farms to no more than $250,000. Interestingly, support is higher among farm income households and Republicans than among voters as a whole.

Since farm income households certainly understand farm programs and their impact, one might assume that their higher support for strict subsidy limits is significant. Not only do voters in these states support strict payment limits, they are willing to take that policy preference into the voting booth:

a majority of voters in each state describe themselves as more likely to support a member who supports limiting direct payments to single farms to no more than $250,000 and at least a third describe themselves as "much more likely" to support such a member. [More]

Lost in all this entertaining excitement is the ground truth that farms like mine are almost past caring. Industrial agriculture will shrug if our $25/A DCP payment shrinks or disappears. And if our "safety net" suddenly looks no bigger than our non-farming neighbor's, maybe we will be slightly more sympathetic to solutions for all of us.

One thing is sure, with all this hoo-hah, negotiating cash rents for 2008 and beyond has become NASCAR-like exciting.

More on that growing silliness anon.
Would he?...

Might President Bush veto a farm bill if it looks like the likely House version?
The Bush administration is signaling that it is prepared to veto the $300 billion farm bill that will probably come before the House of Representatives this week. Bush signed similar legislation in 2002, when his Republicans controlled the House, and he will face pressure to do so again with elections approaching next year. [More]

Hokey smokes, earthlings! While I sorta wistfully imagined him doing the right thing, the reality of it is stunning. Whether the threat can sway anybody is another guess.

Should he follow through, it would signal the cannon is well and truly loose about the deck for the next year and a half, and anything could happen, since he no longer cares about his own party members' political future, especially with them bailing out on Iraq.

Sunday, July 22, 2007

American supremacy...

It would seem I'm letting our team down on my TV viewing.

Hand me the remote, wouldja.
Saved by the edge of the political knife...

What looks like the likely farm bill output for the House has received Speaker Pelosi's blessing. This is not endearing her to her district, but like all Speakers, she knows nobody is going to vote out a Speaker from their own district.

My guess is Rep. Pelosi would throw her own Maltese under a bus to maintain the Democratic majority, and the handful of Democrat freshman in rural districts were not expendable. If you stop and think about it, the only real effort at reform came when Republicans had a large edge in Congress. Stalemate has been very, very good for subsidy fans.

Still, Speaker Pelosi's approach is a clear indication of the one-dimensional image of agriculture. Do farmers vote solely on the basis of how much money we get in the farm bill? (I have never seen evidence of a "farm bloc" vote) Does Iraq not matter to us ? Or health care? Or gay marriage? Or immigration? Would we vote for Lord Voldemort if he came through with doubled loan rates?

Maybe farmers are content to be seen as self-centered simpletons with little interest in affairs beyond the farmgate. That picture does not correlate well with producers I know, but when I think of it, neither do they seem troubled to be viewed that way. Perhaps Ms. Pelosi's cynical arithmetic is right.

As usual, the gold standard coverage of this development is in Jim Wiesemeyer's column at ProFarmer (for which you have to pay - and should) but I'll risk stealing this one nugget that gave me pause.
Payment limitation changes are by far the biggest farm bill achievement in the House farm bill. While farm bill reformists say the alterations did not go far enough and deep enough, changes in payment eligibility (not only for farm program payments, but also for conservation payments), along with the end of triple-entity and a move to direct attribution clearly give this farm bill a reformist label.
Jim and I have a quantum difference on the meaning of the word "reform" but the more I ponder it, eliminating the three-entity rule at least opens the door for future ratcheting down of payment limits. While a very small step, if it is retained by the Senate - which I think very possible - it will force some innovative work-arounds at least by some large operations. [Hint: expect to see more 5 year-olds "materially participating"]

The Senate will have to pass different legislation of course, in order to be seen as contributors, so it may be this proposed legislation is the upper boundary for traditional subsidy recipients.

Friday, July 20, 2007

Taking things seriously...

One of our most infuriating habits as Americans - in the eyes of the rest of the world - is our blasé attitude about events that represent a huge investment of national energy and pride for other nations. I think one current example is playing out in the food fight were are having with China.
A simmering spat over food quality is fast replacing the cheap Chinese yuan as the focus of trade disputes between the U.S. and China. [More]
The 2008 Olympics is not just another ho-hum event for the 1,300,000,000 citizens of the PRC. It is an international spotlight, and by Mao, EVERYTHING WILL GO RIGHT! So any hint of a food problem today bleeding over into '08 is unthinkable.
Politicians on both sides also need to keep their calm. There have been hawkish voices coming out of Washington demanding the US government pursue serious trade sanctions against China after the meat import bans.

Meanwhile, lawmakers in China have accused the Western media of stoking the fears over food safety in China. With next year’s Beijing Olympics fast approaching, there is a danger that China will over-react in cracking down on food safety in a ham-fisted attempt to demonstrate to the world that it treats food safety with paramount importance, punishing undeserving businesses.

Food safety and protecting the health of consumers should be a central concern of all governments. However, politicians should not lose sight of the importance of trade to economic health. Food safety issues must be looked at with a calm head – not with the patriotic zeal currently on display in some quarters of Beijing and Washington. [More]
We can titter with condescension but let's all recall the glory that was the Atlanta Olympics.
The games had a profound impact on the city of Atlanta and many in the Atlanta metro area consider the games to be instrumental in transforming Atlanta into the more modern city it has become since. Examples of this are the mid-rise dormitories built for the Olympic village. One of these complexes became the first residential housing for Georgia State University, and has recently been transferred for use by the Georgia Institute of Technology. Other examples include Turner Field, which was a modification of the original Centennial Olympic Stadium, and where the Atlanta Braves baseball team now makes its home. Centennial Olympic Park was also built for the events and is still in use. Atlanta used no public money to finance the games, which cost US$1.8 billion to host. It was the first city in Olympic history to use ticket sales, commercial endorsements, advertising, and private money alone to fund the hosting of the Olympics. The consequence of this, however, was that many felt that the games in Atlanta were over-commercialized and were less exciting than previous games.[2] [More]
And remember, getting the Olympics right could lead to high rewards.
It's all about opportunity, maybe...

I have puzzled over inequality of assets and income in the US, leaning often to the widening gap in both as a major cause for discontent in a nation that seems to be generating wealth by the ton. And we are not alone.

This OpEd piece from the WSJ is mercifully on their free page and also well thought out.

The data do tell us that economic mobility -- not equality -- is associated with happiness. The GSS asked respondents, "The way things are in America, people like me and my family have a good chance of improving our standard of living -- do you agree or disagree?" The two-thirds of the population who agreed were 44% more likely than the others to say they were "very happy," 40% less likely to say that they felt "no good at all" at times, and 20% less likely to say that they felt like failures. In other words, those who don't believe in economic mobility -- for themselves or for others -- are not as happy as those who do.

Perhaps in a world where there is no opportunity for advancement, an important concern is how one's income measures up to others. In the real world where people believe there is opportunity, however, one's own income potential matters a great deal more than what others are earning. Some studies even find that the happiness of workers rises as the incomes of others climb relative to their own, because they see the incomes of others as evidence of what they themselves can achieve. [More]

This rings true. Gamblers flocking to Las Vegas don't resent winners, they celebrate with them - and it may be because they figure (wrongly, of course) they can duplicate their good luck. But the same guy may be angry about the perception he will never make group leader or sales manager and earn the big bucks. In fact, as more Americans are constantly admonished to shape up or see their job outsourced, mobility for many looks mostly downward.

Tied to this is the much shakier ground many of us feel we have to build futures on. To be fair, it may be a generational affliction. While my sons seem confident that disconnected "employment episodes" can constitute a career, I wonder if their attitude will change as they wander into that fun period called Middle Age.

Loss of a sense of security can be an issue for farmers as well. I will be writing about some ideas to address this in Top Producer this fall.*

*BSP - Blatant Self-Promotion
Whoa - never saw a dog like that!...

What if biotech - like computers - became ubiquitous and accessible?
These facts raise an interesting question. Will the domestication of high technology, which we have seen marching from triumph to triumph with the advent of personal computers and GPS receivers and digital cameras, soon be extended from physical technology to biotechnology? I believe that the answer to this question is yes. Here I am bold enough to make a definite prediction. I predict that the domestication of biotechnology will dominate our lives during the next fifty years at least as much as the domestication of computers has dominated our lives during the previous fifty years.

What might this idea look like in practice?
Domesticated biotechnology, once it gets into the hands of housewives and children, will give us an explosion of diversity of new living creatures, rather than the monoculture crops that the big corporations prefer. New lineages will proliferate to replace those that monoculture farming and deforestation have destroyed. Designing genomes will be a personal thing, a new art form as creative as painting or sculpture. [More of a very provocative essay]

I think I have ignored this admittedly wild idea because I can grasp electronics, but struggled (like many Americans) with biology. While I have read science fiction stories about advanced cultures based on biotech vs. computers, they always seemed pretty far-fetched.

Until now.
Can you name all the Presidents?

I got 39.

[via Neatorama]

Thursday, July 19, 2007

Wednesday, July 18, 2007

The new Farmer Market...

I used to get upset when I read articles like this one from sober university professors about how I should analyze risk in the cash rent market.
Farm Management Specialist Gary Schnitkey at the University of Illinois has completed a thorough study of how to quantify those market risks, to guide farmers and landowners toward the type of lease that will be fair to both owner and operator and allow both sides to share in the premium prices offered by the market. In his latest newsletter Schnitkey says today’s high commodity prices will be offset by higher production costs and lower government support payments. As a result, farmers will have to find a way to retain a larger share of the revenue stream to protect against the risks of the marketplace and the higher cash rent agreements that will have to be paid out. [More]
Now I simply chuckle. Take a look at the spreadsheet. Note there are no entries for factors like:
  • the farm is also your home
  • Moody Farms is bidding on it
  • you farm on 2 (or 3 or 4) sides of the property, making one larger efficient tract
  • it represents 18% of your farm income
  • without it you will have to leave farming
  • you have farmed it for 40 years
  • your mailbox sits on it
  • you compete by blind sealed bid without negotiation
  • your operating time frame is generations, not years
  • landowners who don't know or care what is "fair"
While thoughtful and certainly well-meaning, dispassionate academic number crunching by disinterested economists only goes so far. Economists might be surprised by how much of this type of work many of us already do. We know we are adding risk and pushing the envelope, but unlike advisers we also know first-hand the consequences of winning - and especially losing - the land.

The analysis is also constrained by the data source. FBFM data may not be representative of industrial ag, since very few large operations use the service and share their numbers. In short, economists could be pooling their ignorance.

In some sense, these types of models are therefore simply incomplete - dealing data that is easily accessible and manipulable. Truly useful economic analyses would find ways to quantify the above factors, and indeed that is where cutting edge economic work is going.

I have an idea that might help. Let's eliminate tenure and pay ag economists by the classroom hour or research paper. They would bid for their classes every 2-3 years against all comers, including foreign grad students willing to work for much less and competitors from other colleges.

Then let's see how much risk they accept as reasonable. While this seems caustic, what all these clever spreadsheets ignore is how our brain reacts to risks. Research indicates it is not simply controlled by our rational prefrontal cortex. In fact, we decide it with our emotions and justify it later. And unless the risk is actually real for you, it is unlikely you will understand how such decisions are really made - and more importantly, made to work.

Such analyses are not useless of course, but they only represent the first step in deciding. It has also been my experience that those who focus on the current numbers don't hang around long in the cash rent market. They may have been correct in economists' eyes, but they aren't farming.

Industrial agriculture is outgrowing many ag economics texts, I believe, for the same reason it is commanding the bulk of farm assets and outputs. The practitioners have devised ways to address factors like these and blow careful conventional thinkers out of the water.

[via Farmgate]

Who's for Sousa?...

Interesting little piece of trivia:
In other words, the Department of Defense is about 210 times larger than USAID and State combined—there are substantially more people employed as musicians in Defense bands than in the entire foreign service. [More]

This could explain the current passport debacle.

BTW, if you're planning a Mexican/Canadian getaway or business trip in the future, better get in line now.

[via DailyDish]
At least I'm consistent...

The one idea for farm bill reform I had thought least likely to survive seems to be the one most in play. Given my keen political instincts and personal record (0-for-4 in contested elections), I should have seen this not coming. Or something like that.

Anyhoo, the idea of real payment limits suddenly has leapt to the forefront as "proof" of sincere reform.

Some specifics:
  • The limit for DCP's would be umm... raised to $60,000 (What the heck?)
  • The limit for CCP's would stay at $65,000
  • The limit in MLG's would be ...eliminated. (OK - I get the joke)
This is tightening payment limits? Am I missing something here? [Read for yourself]

Oh, we are going to take stern action with a handful of millionaires.

All seriousness aside, the idea of any payment limitation language at all is a surprise to me, and perhaps an open invitation for floor amendments - they wouldn't have to change the language, just tweak the numbers. Meanwhile the Senate may have some ideas of their own.
Grassley has been working with Sen. Byron Dorgan, D-N.D., on an effort to institute payment limitations in farm commodity programs.
"We believe that if the House would include the Grassley-Dorgan payment limit language in their version of the farm bill, it would save close to $700 million," said Grassley. "With the Senate and House trying to find offsets this year, this seems to be a very good step in the right direction, considering the need to find offsets for spending. Our payment limit legislation would not only help find extra money, but it is real reform in the farm program as well." [More]
It cannot be easy trying to make foolproof plans to provide for every little problem on my farm all the way from Washington. It's amazing how much effort they are putting into it. And how little it may matter in the long run.

Tuesday, July 17, 2007


Where did they come from?

An octothorp??

[via Presurfer]

800 million heroes...

Years ago I read "Alive in a Bitter Sea" by Fox Butterworth, an account of the Great Leap Forward and the horror that followed in China.
The Great Leap Forward is now widely seen, both within China and outside, as a major economic disaster, effectively being a "Great Leap Backward" that would affect China in the years to come. As inflated statistics reached planning authorities, orders were given to divert human resources into industry rather than agriculture. The official toll of excess deaths recorded in China for the years of the GLF is 14 million. Western writers using demographic assumptions and other manipulations have estimated the number of famine victims to be between 20 and 43 million.[4] The three years between 1959 and 1962 were known as the "Three Bitter Years" and the Three Years of Natural Disasters. Many local officials were tried and publicly executed for giving out misinformation[5]. [More]

The book left me pulling for the long-suffering peasants of China, and colors my thinking about the nation still. Chinese farmers still have a long way to go, but perhaps at least some hope is on the horizon.
Second, the Chinese people, especially the peasant farmers, deserve a huge amount of credit. Here's a couple of paragraphs I wrote recently:

The Great Leap Forward was a great leap backward - agricultural land was less productive in 1978 than it had been in 1949 when the communists took over. In 1978, however, farmers in the village of Xiaogang held a secret meeting. The farmers agreed to divide the communal land and assign it to individuals – each farmer had to produce a quota for the government but anything he or she produced in excess of the quota they would keep. The agreement violated government policy and as a result the farmers also pledged that if any of them were to be jailed the others would raise their children.

The change from collective property rights to something closer to private property rights had an immediate effect, investment, work effort and productivity increased. “You can’t be lazy when you work for your family and yourself,” said one of the farmers.

Word of the secret agreement leaked out and local bureaucrats cut off Xiaogang from fertilizer, seeds and pesticides. But amazingly, before Xiaogang could be stopped, farmers in other villages also began to abandon collective property.

Deng and others in the central leadership are to be credited with recognizing a good thing when they saw it but it was the farmers in villages like Xiaogang that began China's second revolution. [More]
It is difficult to face the reality of lives like theirs and then sanctimoniously demand my government protect me from these fellow humans via trade barriers. It also makes one wonder at the persistent US craving for more government involvement in agriculture.

Monday, July 16, 2007

Honeybee update...

When last we left our plucky pollinators, the situation was grim. CCD (colony collapse disorder) was decimating honeybee populations and furrowing the brows of agricultural officials. What happens if honeybees lose this battle?

Maybe not much.
But is CCD such a tragedy? The honeybee may be the only insect ever extended charismatic megafauna status, but it's already gone from the wild (and it wasn't even native to North America to begin with). Sure, it makes honey, but we already get most of that from overseas. What about the $14.6 billion in "free labor"? It's more expensive than ever: In the last three years, the cost to rent a hive during the California almond bloom has tripled, from $50 to $150.

Good thing the honeybee isn't the only insect that can pollinate our crops. In the last decade, research labs have gotten serious about cultivating other insects for mass pollination. They aren't at the point yet where they can provide all of the country's pollination needs, but they're getting there. This year the California Almond Board two-timed the honeybee with osmia ligneria—the blue-orchard bee: Despite CCD, they had a record harvest. [More]
This entire episode has caused me to rethink what I think I know about this corner of food production. Like many, I found myself sucked in by some pretty wild predictions, when most consumers may not notice much more than higher prices on specific foods. Which right now can get lost in the general food inflation.

Still, this mysterious malady (current most likely cause: miticide buildup in the comb) is crippling an important ag industry, and deserves serious efforts by the government to correct.

Maybe beekeepers should get an LDP. That's how we solve things in ag.