Broken promises of rural development

It happened again the other week at a local public forum on agriculture.
The panel of speakers included me, two farmers and a state Farm Bureau economist.
After the formal yakking concluded – yakking that I, the keynoter, contributed mightily to – a questioner in the audience wondered if farmers might better be able to leave the overproduction-federal subsidy treadmill if they marketed more “whole” food directly to consumers.
“After all,” he surmised, “almost everyone wants to buy more wholesome food for themselves and their families.”
Responses. Both farmers on the panel agreed immediately; each wanted more “farmer” presence in the consumer market.
One explained how he had invested some of his farm’s profits in a farmer-owed pork processing plant to do exactly that.
“But it’s tough. It takes big bucks to challenge the big packers at their game,” he correctly noted.
Twofold. My reply to the question was twofold.
First, I joked, when two or more farmers gather anytime the first thing they want to do is pour concrete: build something.
While that’s understandable, given the almost blind love most farm groups have with “supply chains, processing and added value,” a producer’s skill lies in producing, not processing.
Moreover, I added, the rapid consolidation of ag processing and food retailing has made the Archer Daniels Midlands and Wal-Marts almost bulletproof to nearly every competitor.
For proof, simply count the shuttered buildings – every one is a broken dream – of former small retailers and farmer-processors littering small town America.
Can be done. But, and secondly, Ben and Jerry’s made it; Cabot Creamery made it. In short, it can be done.
However, if it’s to be done, I advised, farmers and ranchers need the same advantages that the big boys enjoy: federal help like tax breaks and credit programs as well as marketing and management assistance.
All, however, are in short supply today for any hopeful farmer-food marketer.
Worse, if the 2006 budget offered by the White House in February becomes law, that tiny puddle virtually dries up.
Funding cuts. According to research compiled by the Center for Rural Affairs in Walthill, Neb., 13 USDA Rural Development programs relied upon by farm and rural enterprises will see their 2006 funding cut to the bone.
Seven of the 13 programs will see their bones broken – zeroed out entirely. That means there is not one penny in the Bush budget for the Rural Strategic Investment Program, a $100 million effort in fiscal year 2005.
Also eliminated (compared to 2005 appropriations) will be the $6.3 million Rural Community Development Initiative Grants program, the nearly $40 million in Rural Business Enterprise Grants, $12.5 million in Rural Enterprise moneys, and $3 million for the Rural Business Opportunity Grant program.
Life support. What’s more, the lucky 2006 USDA Rural Development survivors in the Bush plan will be on life support.
For example, the $74.2 million Rural Business Cooperative program will be cut 40 percent to $44.2 million.
The Resource Conservation and Development Program will take a 50 percent hit, down from $51.6 million to $25.6 million, and the $22 million Rural Economic Partnership Program will drop to $13.3 million.
According to Center for Rural Affairs’ analysis, these cuts, when combined with previous cuts imposed by the White House and Congress, mean rural development money contained in the 2002 farm bill will have fallen from a promised $321 million annually to just $129 million.
Vanishing. It also means that during the life of the current farm bill, $1.6 billion in rural development money – $1.6 billion “to address rural poverty, rural business and job creation, rural community development, and rural depopulation,” notes the center – simply vanishes.
To where? Partly to fund the $970 billion inheritance tax break that only 2 percent of all Americans would ever pay and the $106 billion capital gains and dividend tax breaks the House now proposes for millionaires.
It’s shameful, short-sighted lunacy, I told the audience, and most is supported by farm groups whose guiding rural development principle is little more than complete capitulation to giant agribusiness, their partners in chaining eager, idea-laden farmers and ranchers to the global status quo rather than tomorrow’s new markets.
The room went very quiet very quickly.
(Alan Guebert’s Farm and Food File is published weekly in more than 75 newspapers in North America. He can be contacted at agcomm@sbcglobal.net.)

About the Author

Alan Guebert was raised on an 800-acre, 100-cow southern Illinois dairy farm. After graduation from the University of Illinois in 1980, he served as a writer and editor at Professional Farmers of America, Successful Farming magazine and Farm Journal magazine. His syndicated agricultural column, The Farm and Food File, began in June, 1993, and now appears weekly in more than 70 publications throughout the U.S. and Canada. He and spouse Catherine, a social worker, have two adult children. farmandfoodfile.com More Stories by Alan Guebert

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