By Elizabeth Henderson
“Agricultural choices must be made by these inescapable standards: the ecological health of the farm and the economic health of the farmer.’ Wendell Berry, Right Kind of Farming
For almost 5 decades (50th anniversary coming up in 2021!), the Northeast Organic Farming Association (NOFA) has been dedicated to supporting and expanding the community of farmers, homesteaders and conscious eaters who build their lives and livelihoods through agroecology – growing and consuming food, forage and other crops in as much harmony with natural processes and rhythms as we can muster. We have been leaders in promoting buy local organic and alternatives to globalized industrialized chemical agriculture. To enable shoppers to identify organically grown food, NOFA has put a lot of resources – time and energy -into developing and maintaining organic certification and the integrity of the organic label. Increasing public recognition of that label has helped save many generational farms and enabled the creation of new farms. But that label is not enough to keep family-scale farms viable.
For as long as I can remember (and I started farming in 1980), most of the farmers I know have supported their farms by someone’s off farm job – either the farmer or someone in the family. 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 – the farmers 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. The price farmers receive for crops does not cover all the costs of keeping farms viable, not to mention the extra costs of ecological or regenerative farming systems. The farm crisis is not over.
Can we find solutions?
Let’s turn back to Wendell Berry who offers a possible path: “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.” [i]
Production control plus price supports = parity plus supply management.
What does production control and price supports mean and how did it work under the New Deal?
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”.[ii] To resolve that disparity, the AAA set out to reestablish farmers’ purchasing power taking the years just before WWI as the base period when the proper balance existed. Prices to consumers were also pegged at the same proportion of their income as during those 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. 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 to limit some fruit and vegetable crops. 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 1960’s.
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 or policies that discriminate against farmers who use organic methods.
Farm income in 1935 was more than 50 percent higher than farm income during 1932, due in part to the farm programs.[iii] In addition to price stability and soil conservation, President Roosevelt included a third major objective “the protection of consumers by assuring adequate supplies of food and fiber.”[iv] Legislation each year set the level of the price supports from 50 – 90 percent of parity depending on the supply of each commodity and the changing economic conditions through the years of WWII.
In“Crisis by Design: A Brief Review of US Farm Policy,” Mark Ritchie and Kevin Ristau[v] summarize the way the parity system worked.
“The parity program had thee central features:
(1) It established the Commodity Credit Corporation (CCC), which made loans to farmers whenever prices offered by the food processors or grain corporations fell below the cost of production. This allowed farmers to hold their crops off the market, eventually forcing prices back up. Once prices returned to fair levels, farmers sold their crops and repaid the CCC with interest. By allowing farmers to control their marketing, the CCC loan program made it possible for them to receive a fair price from the marketplace without relying on subsidies.
(2) It regulated farm production in order to balance supply with demand, thereby preventing surpluses. Since government storage of surpluses was expensive, this feature was crucial to reducing government costs.
(3) It created a national grain reserve to prevent consumer prices from skyrocketing in times of drought or other natural disasters. When prices rose above a predetermined level, grain was released from government reserves onto the market, driving prices back down to normal levels. From 1933 to 1953 this parity legislation remained in effect and was extremely successful. Farmers received fair prices for their crops, production was controlled to prevent costly surpluses, and consumer prices remained low and stable. At the same time, the number of new farmers increased, soil and water conservation practices expanded dramatically, and overall farm debt declined. What is even more important is that this parity program was not a burden to the taxpayers.”[vi]
Parity Was Legal and It Worked
“A Short History of Agricultural Adjustment, 1933 – 1975,” summarizes 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.” [vii]
According to Mark Ritchie in “The Loss of Our Family Farms: Inevitable Results or Conscious Policies?” a consortium of agribusiness, banking and university leaders deliberately set in place policies that cut farm prices to drive excess “resources” (that is farmers and their families) out of the countryside.[viii] By the mid-70’s, however, farm prices were dropping below parity. Instead of a system that had provided stability for family-scale farms, farm numbers were decreasing rapidly and the cheap food policies that we have today were in place.
The combination of subsidy and emergency payments to farmers along with the program of crop insurance in the 2018 Farm Bill actually guarantees low prices that mainly benefit the biggest ag corporations.[ix] With production control and price supports, those corporations had to pay farmers decent prices in the marketplace. Just to take a couple of commodities for illustration purposes, according to the National Agricultural Statistice Service (NASS), the parity price for 100 pounds of milk in May 2019 would be $52.80, a bushel of corn would be $13.20. Instead, conventional farmers were getting $18 for a hundredweight of milk and $3.63 for a bushel of corn.[x] Since the 1970’s, it is the tax payer who covers the costs of cheap food. This adds up to a major transfer of wealth from the farmers and the public to the likes of Amazon, Walmart and Archer Daniels Midland.
21st Century Parity and The Green New Deal
Although a few farming organizations, in particular, the National Family Farm Coalition, have continued to demand a return to parity and supply management, for twenty years or more it has been deemed too unlikely to gain any traction in D.C.. Then in a flash of light, the Green New Deal resolution by Senator Ed Markey and Congresswoman Alexandria Ocasio-Cortez, a crash program to mobilize all possible forces to prevent climate disaster, has made it “realistic” once again to consider this set of root solutions to the food and farm crisis.[xi]
Iowa farmer George Naylor explains the inherent logic of parity plus supply management that stops farmers from over producing and provides economic incentives to use the most ecological and efficient practices “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.”[xii]
While we can learn a lot from the old New Deal, both its strengths and also its failures especially in regard to farmers of color, we will have to design a new version for the 21st century that includes racial justice and equity in the safety net it provides for farms. I can imagine an exciting public process where groups of stakeholders all over the country hammer out the details. On a much smaller scale, that is what we did in the 90’s 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 NYS where a few hundred farmers and activists brainstormed and formulated recommendations.
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 this climate emergency into an all-out campaign to save human life on this planet.
[i] “Right Kind of Farming,” Gracy Olmstead – NY Times Opinion Section, Oct. 1, 2018
[ii] [PUBLIC—No. 10—73D CONGRESS] [H.R. 3835] AN ACT to relieve the existing national economic emergency by increasing agricultural purchasing power, to raise revenue for extraordinary expenses incurred by reason of such emergency, to provide emergency relief with respect to agricultural indebtedness, to provide for the orderly liquidation of joint-stock land banks, and for other purposes.
[iii] A SHORT HISTORY OF AGRICULTURAL ADJUSTMENT, 1933-75 Wayne D. Rasmussen, Gladys L. Baker, and James S. Ward of ECONOMIC RESEARCH SERVICE UNITED STATES DEPARTMENT OF AGRICULTURE AGRICULTURE INFORMATION BULLETIN NO. 391 p. 5
[iv] Ibid., pp. 4 – 6.
[v] CRISIS BY DESIGN: A BRIEF REVIEW OF U.S. FARM POLICY Mark Ritchie & Kevin Ristau League of Rural Voters Education Project 1987, pp. 2 – 3. Ritchie and Ristau make a very important point: (p. 14) “Paying farmers a fair price would result in a one-time increase in food prices of only 3 to 5 percent, less than a nickel on a loaf of bread. Since the supply management proposal also contains provisions for doubling the funds available for food assistance, the poor would not be hurt by this small increase in food prices.”
Also see “Parity and Profits” by Charles Walters. Posted on July 30, 2001 on Weston C. Price website. Remarks of Charles Walters, Executive Editor, Acres USA Given at the Acres USA Conference December 1999, Minneapolis, MN, and “Parity and Farm Justice: Recipe for a Resilient Food System,” by Patti Edwardson Naylor, George Naylor and Ahna Kruzic, Food First Backgrounder, Vol. 24, #2, Summer 2018.
[vi] The US parity system resembled existing dairy supply management which came under attack by Trump during the 2018 – 19 NAFTA negotiations. For a description of the Canadian system see: Inside U.S. Trade U.S. singles out supply management in Canada’s WTO trade review, By Hannah Monicken. https://insidetrade.com/daily-news/us-singles-out-supply-management-canada’s-wto-trade-review. 06/12/2019. Monicken writes: “In its government paper prepared for the review, Canada defended its supply management policy for “promot[ing] stable farm incomes” and avoiding “shortages and costly surpluses.”
“By effectively managing production and farm gate prices, shortages and costly surpluses are avoided, while providing consumers with a steady supply of high-quality products. Under the supply management system, national and provincial marketing boards control the supply of farm gate products (e.g. milk) to meet the demand of the Canadian market using production quotas,” the Canadian government said in its report. “Finally, agricultural tariff-rate-quotas ensure predictable import levels and thus maintain the efficacy of production and price controls for supply-managed products.”
[vii] A SHORT HISTORY OF AGRICULTURAL ADJUSTMENT, op cit, p. 21.
[viii] “The Loss of Our Family Farms: Inevitable Results or Conscious Policies?” Mark Ritchie, League of Rural Voters, 1979.
[ix] From Brad Wilson email to Comfood of June 26, 2019: The SUBSIDIES of the 2014 and 2018 farm bills ARE SO IRRATIONAL that, even though corn prices had fallen, year after year, (2012 $6.89; 2013 $4.49; 2014 $3.70; 2015 $3.61; 2016 $3.36; 2017 $3.30; 2018 low, and similar for other major prices). Most CORN farmers receive(d) NO SUBSIDIES FOR 2017 AND 2018 (paid in 2018 and 2019).[c.] It’s also claimed these subsidies were paid “to stabilize our food supply.” In fact, however, the total package of policies has been extremely DESTRUCTIVE TO FOOD AND NONFOOD production SYSTEMS, with the on-farm crop devastations also infecting the processing, exporting and livestock production sectors. Related to this, it’s claimed that farm programs “pit production against conservation.” This implies that production is the winner at the expense of conservation. The data shows very clearly, however, that farmers have been penalized for increased production, (have been paid less, especially when costs are figured in). A more direct and correct interpretation is that farm programs “PIT CHEAP PRICES TO BENEFIT AGRIBUSINESS AGAINST CONSERVATION.” That is, farm programs have led to farmers being paid less and less in the market (and over all as net results that include subsidies,) instead of maintaining prior policies of economic justice that were much better for conservation. Ever cheaper prices for CAFO feed ingredients forced diversified farmers to subsidize the loss of their own value added livestock to CAFOs. ..Wilson concludes: The major thing the farm programs do today, then, is that they allow chronic free market failure. And secondarily, they cover it up with inadequate subsidies that would otherwise not be needed at all, (and were not needed in the past). This then is the elephant in the room that is ignored in the article.
[x] Agricultural Prices ISSN: 1937-4216 Released June 27, 2019, by the National Agricultural Statistics Service (NASS), Agricultural Statistics Board, United States Department of Agriculture (USDA) https://downloads.usda.library.cornell.edu/usda-esmis/files/c821gj76b/r494vw17c/sq87c499d/agpr0619.pdf
[xi] Policy Bridge Securing the Future of US Agriculture: The Case for Investing in New Entry Sustainable Farmers, Liz Carlisle, et al. Elem
Sci Anth, 7: 17. DOI: https://doi.org/10.1525/elementa.356
and A Green New Deal for Agriculture, Raj Patel and Jim Goodman. https://jacobinmag.com/2019/04/green-new-deal-agriculture-farm-workers
For a rural Green New Deal to work in the twenty-first century, everyone’s incomes need to increase. Growing food justly and sustainably is expensive. Instead of driving down the costs of farming to make food cheap enough for urban workers to buy on stagnating wages, 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, sustainable agriculture: through low-input, sophisticated agroecological farming, renewable energy, unprocessed fresh food, and 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.
Parity pricing will mean an end to “cheap food,” and that’s only thinkable in tandem with the end of cheap work. A front that brings unions and the urban anti-hunger lobby together with the right parts of the farming community could make this happen. But it’s hard to imagine CAFOs being a part of that bloc.
Just as during the New Deal, we live in a time of incipient fascism, racism, and class divide. The Green New Deal can learn from its antecedent’s successes and failures, which provided a dramatic economic shift in rural America — not as dramatic as we might have wished for, nor as long-lasting as we would have liked, nor as egalitarian as it should have been. Yet the New Deal did make the case that environmental protection and paying people fairly for their work might go a long way towards limiting the power of corporations and creating a fair society for everyone.
[xii] In email to author, July 26, 2019. Naylor writes about parity at greater length in “Without Clarity on Parity All you Get is Charity,” Food Movements Unite! Ed. Eric Holt-Gimenez, 2011.