Withdrawing from the Soil Bank
JUNE 01, 1956 by MARTEN BUTLER
Mr. Butler, except for two years in the Army, has operated a 275-acre “home farm” in the corn-belt since 1947. This article is based upon a discussion last February before the Rotary Club of Ottawa, Illinois.
Three policies are embodied in the farm programs now being discussed to aid agriculture. We must recognize that all of them involve some redistribution of income from city people to farmers.
The soil bank plans are forms of production control. By reducing use of land without reducing use of capital and labor, the soil bank plans tend to shift the amount of labor and capital used in relation to land. This shift would mean an increase in the share of income going to land and a reduction in the share going to capital and labor. This means that the operator-tenant will be up against more intensive competition when he attempts to rent a farm, and the rental terms will be steeper in favor of the landowner. This is already happening as a result of past and present government programs. This increase in land income is reflected in higher land values. We have seen nearly all the benefit of price supports incorporated into the price of land. If the soil bank bill now before Congress becomes law, I believe that land inflation will resume its course, and prices of $700 and $800 per acre will not be uncommon in LaSalle County. In other words, when you remove competition from the market place, you replace it with competition for the means of production. No one but present owners can benefit.
Another policy is Price Support above free market level. This policy is responsible for the present accumulation of surplus commodities.
Expansion of Consumer Demand is a third approach. The objective here is to improve the diets of low income people and expand demand generally. School lunch and food stamp plans are in this category.
It is difficult to assess results of the advertising campaigns for upgrading the American diet, but these efforts deserve all the imagination and support we can give.
There is a fourth approach which I believe is receiving too little attention. This plan would assist people now farming to make the best choice for their individual circumstances between farm and nonfarm employment. As more people choose nonfarm employment, three results naturally occur:
1. Income opportunities improve for the families remaining in farming.
2. It would become easier to conserve and improve marginal land as the pressure of surplus farmers is removed from it.
3. It might also encourage the consolidation of some farms into more efficient family-size units.
About half of the boys and girls born on farms today will choose other employment and leave agriculture. This has been going on for many years and will continue. No one goes around wearing a long face because of it. I have attended many farmers’ meetings since I returned from the Army three years ago. I have heard enough crying about low prices and the exodus of farmers to the city. Each time a farmer sells out at auction you might think we should hold something like a funeral service. I would regard the occasion more as a cause for celebration—not because another of my competitors has bitten the dust, but because it means that we are making rapid progress in solving man’s oldest and toughest problem: the problem of food production. It means that agriculture has released another man to tackle more urgent problems that press us on every side.
I realize full well that agriculture may not require my services much longer at the price I must ask for them. When that fact is made clear to me, I shall welcome the opportunity to move to an occupation where I may perform a more useful service for my neighbors. It is only by this process that our living standards improve. It disturbs me to find that some men believe that the world owes them a living in the occupation they prefer and in the style to which they would like to become accustomed. I do not believe that many Americans will sell out their heritage of opportunity for the elusive security of a miserable work ration assured by law.
I believe that agriculture and the free-market system can continue to contribute to our rising standard of living as they have during the past 50 years. However, with a faster-changing economy, we will never realize the full potential of our American system until our productive citizens are enabled to shift more freely to meet its demands.
The correct solution for agriculture’s problems will be equally applicable to any other industry.