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Farm protests hit the statehouses.

Financial disaster is spreading through the nation's grain belt, casing the failure of thousands of small and mid-size farms. The three horsemen of this apocalypse are depressed land values, low commodity prices and high real interest rates on heavy debt burdens. The mounting desperation among America's family farmers has turned the spotlight on the ninety-ninth Congress, where the debate on the 1985 farm bill--and on the Reagan Administration's proclaimed goal of slashing price supports--will be the most fundamental one since the New Deal. Virtually all national organizations representing farmers will be lobbying for Congress to retain price supports at their present levels. Only the conservative American Farm Bureau Federation fully accepts the Administration's "market-oriented" approach.

These same groups will also be directing their fire at state legilatures. In Iowa, where Secretary of Agriculture Robert Lounsberry predicts that bankruptcies, foreclosures and voluntary liquidations will wipe out 11,000 farms in the next two years (10 percent of the state's total), the Farm Unity Coalition has developed a local legislative agenda. It calls on the State Legislature to provide funding for a hot-line service for farmers in financial distress, adopt tax reforms, retain a 1976 state law prohibiting corporations from owning farmland and pass a resolution urging Congress to back higher commodity price supports.

With some variations, progressive farm groups and coalitions in other states are aggressively pushing their demands for help and reform. In addition to the usual lobbying, many groups have utilized more dramatic methods of bringing the farmers' plight to legislators' attention. This month in Des Moines, the Farm Unity Coalition plans to place crosses, symbolizing the "death" of 4,000 family farms in the past two years, on the Statehouse lawn. The coalition has planted them at county courthouses, and last month it sent distressed farmers to apply for food stamps en masse. In Worthington, Minnesota, a December 15 rally attracted 1,200 farmers, according to Brewster farmer Bobbi Polzine, one of its organizers. It included three-minute "testimonies" by representatives from Minnesota's rural communities about the effects of the farm crisis.

High on farm groups' agendas in several states is legislation declaring a moratorium on foreclosures. Such measures were taken by twenty-five states during the Great Depression. Minnesota enacted a limited moratorium two years ago which allows a one-year redemption period after a farm is foreclosed, during which the owner can reclaim it by cleaning up the back debt. Although they expect heavy opposition from bankers, groups like Minnesota COACT (Citizens' Organizations Acting Together) are seeking to strengthen the law so that it includes chattel loans and provides time for restructuring debt. (Actually, the redemption provision is seldom a realistic option for foreclosed farmers.)

While prospects for the passage of a moratorium law this year are slender, the idea is spreading in Iowa. Jerome Hickman, president of the North Dakota American Agriculture Movement, says he thinks such a law will become a high priority for his group. Reg Pityer of the Wisconsin Farm Unity Alliance reports that groups including the Wisconsin Farmers Union will definitely lobby for one in his state. Indiana COACT farm activist Philip Bright foresees a bill extending the nominal redemption period in that state. Such a bill passed both houses of Indiana's Legislature last year in different forms, only be lost in a more conservative conference committee.

With large numbers of farms being forced onto the auction block and depressed land values the result, family farm advocates see a potential invasion of Midwest agriculture by corporate capital. Several states have laws, passed within the last decade, that prohibit or severely limit large corporations from owning farms. In November 1982, 56 percent of Nebraska voters approved such a measure--Initiative 300, a state constitutional amendment-- despite a $500,000 campaign mounted by the opposition.

These relatively recent laws will be the targets of agressive lobbying drives. In Iowa, for instance, a recent report on the state's declining cattle industry, written by the consulting firm Cattle-Fax for the Iowa Cattlemen's Association, suggests weakening the state's Family Farm Protection Act to make room for corporate-owned feedlots. A number of bankers are also advocating changes to allow an influx of corporate capital, which they say would bolster land values. The conservative chorus is not unanimous, however. Iowa State University agricultural economist Neil Harl, for example, believes Iowa farmers are too vulnerable for such changes now.

Nebraska groups are also bracing for a possible attack on their law, but since it took the form of a constitutional amendment, voters would have to approve any change. In Indiana, COACT plans to push the Legislature to restrict corporate ownership of farmland, a measure opposed by the State Farm Bureau. Other groups behind the effort, Bright says, are Citizen Action Coalition of Indiana, the National Farmers Organization, Indiana Farmers Union, Women Involved in Farm Economics and the American Agriculture Movement. Those groups are also pushing to make the office of Secretary of Agriculture elective, thus removing it from the control of the lieutenant governor.

What most state-level alliances and coalitions see as the fundamental issue in the farm crisis, however, is farm prices. Groups in Wisconsin and Iowa plan to lobby for resolutions "memorializing" Congress to take measures to raise farm prices, much as some legislatures did in the 1930s, says Carol Hodne, staff director of the Minneapolis-based North American Farm Alliance. Recent figures from the Department of Agriculture show that since 1977, farmers' production expenditures have increased by 64 percent, while farm prices have increased by only 37 percent. The farm price ratio has been under 100 every month since January 1981, according to the same figures. U.S.D.A. subsidies, in effect, have become the only source of overall net income for American farmers.

The farm coalitions thus argue that restoring profit through higher prices is the only realistic way to allow farmers to pay off their massive debt load, which stands at $212 billion nationally. Last November at the Midwestern Governors' Conference in Lincoln, Nebraska, with over 600 farmers in attendance, wheat growers emphasized their support for a program that would substantially raise loan rates (the price level set by the government in determining its loans for a given commodity) and raise target prices (the level at which the market outstrips government price supports).

Without higher prices the prospects are Bleak indeed. If present trends continue, says University of Nebraska economist Larry Swanson, towns of fewer than 1,000 people will be doomed. Most economists estimate that for every seven farmers who leave the land, one small business will go under, and some are begining to make more pessimistic predictions. The Minnesota Department of Economic Security office in Worthington, serving a five-county area, recently estimated that the cost of retraining and relocating displaced farmers in its region in 1985 will be $3 million. According to a study conducted by Iowa State University's Cooperative Extension Service last summer, the level of rural unemployment in eight counties in the southwest part of that state is 18.5 percent -- not 6.5 percent, as Iowa's Job Service Department has reported. As the social and economic costs mount, state budget makers throughout the Midwest are seeing economic development dreams undermined and their tax bases diminished. The Reagan Administration's plans to gut most farm price supports only reinforces a growing and pervasive pessimism.

Not all farm groups are willing to trust Congress to come up with a solution on price issues. Minnesota COACT has been promoting a law that would set minimum prices throughout the state. The proposal would set a floor of 80 percent of parity on major commodity prices as soon as a sufficient number of other states have passed identical laws, so that 60 percent of a given commodity would be controlled. Under the COACT proposal the price of corn, for instance, would rise from around $2.50 per bushel in most areas to $4.28 per bushel. Since farmers get an average of only 28 cents of the retail food dollar, advocates of only insist consumers would be affected only marginally by such increases. In the bargain, it would restore economic health to a number of related industries, they say. Mike Laidlaw of Minnesota COACT expects at least a two-year campaign.

Iowa Citizens for Community Improvement also plans a minimum price campaign, though a similar effort failed in 1983. In North Dakota, Hickman foresees a push for minimum price legislation. Groups in other states are less enthusiastic. A major drawback, they contend, is that a high degree of regional solidarity is required for the approach to succeed. Then there are legal questions--for example, such laws could be an unconstitutional restraint of trade.

On the fringes of the grain belt there are signs of frustration with the legislative process. In Ohio, a largely industrial state, Joe Chrastil, a multistate COACT organizer, reports the Family Farm Movement is "giving up" on the "conservative" State Legislature and concentrating on direct action against farm foreclosures. In most states, however, farm groups will continue to employ both direct action and lobbying as complementary strategies. However, the balance is slowly shifting from working within the system to activism outside it.
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Author:Schwab, Jim
Publication:The Nation
Date:Jan 19, 1985
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