Defending the Right to Farm
by Alexis Lathem, Rural Vermont
September, 2002

Residents of Charlotte Vermont were hit with alarming news several weeks ago: aneighbor, Clark Hinsdale III, has applied for a permit to expand and consolidate the family’s dairy farm into what could ultimately become the state’s largest dairy, with as many as 2,500 cows. As in Highgate, where residents have opposed the expansion of Vermont’s first corporate factory farm, Vermont Egg Farms, Inc., the conflict between Hinsdale and his neighbors has gained statewide attention and has become the focus of a highly-charged debate over the future of Vermont’s agriculture.

There are differences, however, between the operation in Highgate - whose absentee owners have no stake in the community and who simply use the land as a base of operation - and the Hinsdale farm. The Hindsale’s do live in the community (though they rely on hired help to run the farm), they do spend their money locally, and they do cultivate the land. This is not a corporate animal feedlot.

However, it complicates matters that Clark Hinsdale III is the president of the Vermont Farm Bureau, which is part of the American Farm Bureau, a multi-billion dollar business conglomerate and lobbying group in defense of corporate farms and big agribusiness. Throughout the country when family farmers are pitted against large animal feedlots it is the Farm Bureau that steps up to the plate to defend the factories — just as as the Vermont Farm Bureau defended Vermont Egg Farms, Inc. in its conflict with its neighboring dairy farmers. In Washington, the Farm Bureau has actively fought just about every family-farm friendly piece of legislation that has been proposed, most notably legislation that would restrict the corporate consolidation that is at the very heart of the crisis in agriculture in America. The Hinsdale’s proposal represents more than one family’s choice to modernize and expand in order to remain profitable in today’s marketplace — as Farm Bureau president, Hinsdale is also seeking to legitimize the large farm as a viable future for agriculture in Vermont.

Leading the charge in support of large farms is the argument of economic necessity: LFO (Large Farm Operation) proponents draw on public sympathy for family farmers who are struggling in an adverse economic environment, claiming that, to save farming in Vermont a compromise must be made: large farms or subdivisions. According to this view, family farms fail because they are ‘inefficient’ and in order to survive in today’s marketplace they need to adopt ‘economies of scale.’ These arguments are widely and uncritically accepted, and yet, they don’t stand up to scrutiny.

Large farms are not, in fact, more efficient. Farm Credit figures for the year 2,000 report that small farms (89 cows or less) had a higher net profit per cow than large farms (300 cows or more).The net worth of a cow on a farm with 300 cows or more was only $3,898, compared with $7,285 for a small farm. Farm Credit’s Dairy Summaries actually show a steady increase in efficiency in inverse relation to farm size.(1 )

The fact is, the most economically viable dairies are organic dairies — which are also the smallest and the least industrialized. They are also the least subsidized. A study conducted by the Northeast Organic Farming Association shows that the net earning per cow for organic dairies was $477 in 1999, compared to $255 for conventional dairies. And that difference has widened since 1999, which was a good year for milk prices; since then the price of a hundredweight of milk has fallen to $11 for conventional farmers, while organic milk prices have remained stable at $21. (2)

A further problem with the arguments in defense of large farms is that they place the blame on the farmer for failing to be profitable, when the problem is low prices. Large or small, a farmer is not going to make it if milk prices fall below the cost of production. In truth, a farm with a lower overhead will fare better through a period of low milk prices than a large farm with a multi-million dollar debt.

Today the price of milk has dropped to 1960s prices, although production costs have doubled over the last two decades and the cost of living has soared. Even the most profitable farms still have production costs above the price they receive for their milk. The sad truth is that 80% of America’s farmers report a negative income from farming and must rely on subsidies or off-farm jobs for their income.

How is it, then, that the mythology of ‘economies of scale’ has come to be so widely accepted, given that it has no basis in fact? One reason is that ‘efficiency’ usually means labor efficiency: large industrialized operations rely on less labor. While a farmer may reduce labor costs he has not necessarily lowered his overall costs by adopting expensive machinery.

A related misconception is that large industrial farms are more productive. In fact, study after study has shown that small diversified farms are more productive than large monoculture farms. A source of the confusion is a failure to distinguish between yields and total output. A large industrial farm will typically have only one or two products, while a small diversified farm will have many — products of both economic and supra-economic value — many of which are statistically invisible. A farm that is not just a factory producing a single commodity is a home, a way of life, a center of learning, a habitat for wildlife — and it is a source of innumerable benefits to the community, many of which can be translated into economic values, such as tourist dollars, though others simply are not or cannot be measured.

Another argument in favor of large farms is that they are ‘modern’ and the ‘way of the future’ and that critics of industrial agriculture are simply unwilling to accept change. Yet how can any agriculture system wholly dependent upon diminishing non-renewable resources seriously be considered to represent the farming of the future? Agriculture for the 21st century must learn to do without petroleum-based fertilizers and fossil fuels and to preserve precious topsoils. The myth that we must adopt industrial methods in order to feed the world’s exploding populations is based on the myth of its greater productivity, which as we’ve already shown, is false.

The most encouraging area of increasing crop yields per acre of land is in the area of sustainable agriculture: a recent world-wide study of sustainable agriculture projects on more than four million farms found average yield increases of an astounding seventy-five percent. (3) (In contrast, the much-heralded genetic engineering technology has failed to demonstrate even marginal yield increases.) If we are really worried about feeding the world, then we better adopt sustainable agriculture methods right away. What better place to take the lead than Vermont?

What we have come to accept for ‘efficiency’ is in reality anything but efficient. Our industrial food system is so inefficient that 12 energy calories are spent to produce a single calorie of food energy; the typical American meal has travelled 1,500 miles before it reaches the table; a typical Idaho potato farmer is a half a million dollars in the hole before he sells a single potato; and, most disturbing of all, 2.5 tons of top soil are lost for every ton of grain produced on an industrial monoculture farm in the US.

If large scale industrial agriculture is not more efficient and profitable, then what’s driving the trend? While producers may be losing money, the input sector as well as the processing and retail sectors are reaping record profits. Concentrated animal feedlots rely on more technology and more grain, which is produced by using more chemicals and more fertilizers, while processors benefit from an anti-competitive system which allows them to buy low and sell high.

In Vermont, Agriculture Commissioner Leon Graves and other defenders of big agribusiness have tried to discredit their critics by calling them Luddites or suburbanites who simply don’t understand the realities of farming. According to this view, the Hinsdales are standing up for the ‘right to farm’ against the encroachment of suburbia. But Charlotte’s affluent professionals were not the only ones who showed up at the packed public meeting at the Old Lantern on June 18: farmers were there too. One farmer showed up holding a placard that read MONOPOLISTIC FARMS = GENOCIDE FOR FAMILY FARMS.

Genocide. That’s strong language. But without exaggeration the family farmer, it may be said, has been the target of a systematic program to eliminate agriculture’s "excess human resources." As corporations gain increasing control over our food supply, the farmer is being squeezed out, and rural America is becoming increasingly divided between rich and poor, between those who own and control the land and those who work it. Large industrial- style agribusiness exploits ‘right to farm’ laws which were designed to protect family farmers, in order to protect the economic interests of those who are pushing the family farmer off the map. If every dairy farm had 2,000 cows, how many farmers would we have left (given that the milk market is saturated)? In Vermont, where the average dairy has about 80 cows, that would mean nine out of every ten farmers would be out of business. What about their ‘right to farm’?

In this light, the farmer with the placard had a point. What is at stake in Charlotte and in Highgate is much larger than a fly infestation or a three-acre manure pit. What is at stake is our food supply, the land, and who will control it. Thomas Jefferson warned us about the importance of keeping the land in the ownership of many: it is the very basis of a democratic society. Today the entire food "system" is virtually in complete control of a handful of mega-corporations; and with genetic manipulation these same corporations will become the ‘proprietors’ of the DNA of our major food crops.

Consolidation - not number of cows - is the issue here: consolidation of land ownership, of wealth, and of control over our food supply. Not only have we seen the growth of huge monopolies such as IBP, Cargill, and Suiza Foods, in recent years a wave of mergers and acquisitions in the food retail sector has created equally powerful corporate monopolies (with Wal-mart sitting at the very top of the food chain). Today the top five food retail chains account for almost 50% of all food retail sales; these retailers are also ‘vertically’ integrating with the processing and production stages, creating powerful food chain clusters. That is the meaning of those supermarket brands: a retailer that produces and packages its own beef or pork has no need of independent livestock producers. Moreover, it doesn’t matter if the industrial methods used to produce that beef or pork are economically irrational, because a corporation that owns every stage of the process, from seed to plate, can stand to lose money at the production stage because it is making money at every other stage of the process.

According to a recent study of consolidation in the food industry conducted by rural sociologist William Heffernan, the emerging food system will ultimately be organized around five or six global food chain clusters, which are on track to control every stage of the food system from seed to plate. (4)

Concentration: this is the problem at the heart of our agriculture system and it is gnawing away at the very roots of our democracy. The problem with large farms will not be solved merely by limiting the numbers of cows in the barns, but by revitalizing our rural communities through building a strong local food economy and by keeping the land in diversity. Here in Vermont, we have a lot of work to do, but if it can be done anywhere, it can be done here.

Notes:
1. The 2000 Dairy Farm Summaries is published by four Northeast Farm Credit Associations, the leading agricultural lenders in the northeast. The report summarizes data from more than 500 dairies in the eight northeastern states.
2. With premiums, an organic producer can earn up to $23-$24 a hundredweight.
3. The study was conducted by Professor Jules Pretty, director of the University of Essex Center for Environment and Society. For a summary of the study see Rural Vermont’s Farm Policy Network News #14 (July, 2002). To see the full report go to www.essex.ac.uk/ces
4 For a summary of Heffernan’s report, Consolidation in Food Retailing and Dairy: Implications for Farmers and Consumers in a Global Food System, see Rural Vermont’s Farm Policy Network News #2 (June 2001).