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What you should have learned in Soc 325 (if you had been paying attention)

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Title: What you should have learned in Soc 325 (if you had been paying attention)


1
What you should have learned in Soc 325 (if you
had been paying attention)
  • Paul Lasley
  • Jolene Glenn
  • Tomoko Ogawa

2
Agriculture vs Agri CULTURE
  • One can not understand agriculture and farming
    without understanding the HISTORICAL content and
    basis of agriculture development
  • One will not be able to successfully farm in the
    future without attention to the CULTURAL basis of
    farming and rural life

3
What do we mean by Cultural Basis of Farming
  • The human dimension of producers, consumers and
    other stakeholders
  • Values and goals
  • Attitudes
  • Opinions
  • Lifestyle
  • World view
  • Recognition of differences among stakeholdersWho
    are they and what are their expectations?

4
Course is presented in 3 periods
  • Historical1607-1945
  • Current period 1945-2000
  • The Future 2000 and beyond

5
Agriculture vs Farming
  • They are not synonymous
  • Three sectors of agriculture
  • Input or supply
  • Farm sector
  • Output or processing

6
What is a family farm and how does it differ from
other types of farms?
  • Land ownership
  • Labor
  • Capital
  • Management
  • Residency
  • Dependency

7
Important values associated with farming
  • Provided impetus for the great American
    experiment in agrarian democracy
  • Competition
  • Opportunity
  • Way of life vs. business orientation
  • Family
  • Hard work is virtuous
  • Independence
  • Work with nature

8
Twin Pillars of Rural Culture
Structure ofAgriculture
RuralCommunities
9
Consumer Preferences
Export Policies
Global Competiveness
Environmental Community
Foreign Defense
Monetary Policies
10
Official Definition
FARM -- according to U.S. Census of Agriculture
is any unit that has agricultural sales of 1,000
or more per year
6.8
1.9
1920
2002
11
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12
Number of Iowa Farms
Thousands
250
211
208
206
190
200
154
150
124
115
97
100
50
0
1920
1930
1940
1954
1964
1974
1982
1992
Agricultural Census Data
13
Percent Farm Population, 19401990
Percent
50
40
36
30
30
25
24
20
18
20
14
13
10
9
10
5
2
0
1940
1950
1960
1970
1980
1990
U.S.
Iowa
14
Population Residency
Urban Population Rural Non-farm population Farm
Population
15
Population Residency
16
Many decisions made in the Colonial Period Shaped
the Future of Agriculture and Rural Life after
Independence
  • Colonial Period 1607-1775
  • What were some of those important events?
  • Goal was to get rich, investors
  • Theocracyreligious freedom-Protestant work ethic
    was imported
  • Ability or opportunity to get ahead
  • Labor scarcity contributed to large families,
    indentured servants and slavery--1619

17
Early Colonial Experience
  • Export agriculture
  • Triangulation and mercantilism
  • Regional specialization
  • Exploitive, subsistence agriculture
  • Navigation Acts? Colonial unrest? War of
    Independence

18
The early days of the nation
  • Land Acquisition 380 million acres
  • Land Disposal
  • Jefferson vs. Hamilton
  • Liberalization of land disposal?Homestead Act
    1862
  • Land measurement
  • Role of land speculators and squatters

19
Land Use
  • Abolished remnants of feudal pattern
  • Private ownership of land
  • How land was used
  • Sold to raise capital for the govt
  • Incentive to enlistment in army
  • Used to support local schools
  • Financed Land Grant Universities

20
Early and Persistent Issues
  • Indian removal
  • Slavery (Missouri Compromise)
  • Access to markets
  • Infrastructure
  • Credit

21
Population Growth
  • 1860 one-half of the adult males were foreign
    born
  • Immigration doors kept open
  • Labor for industrialization
  • Abolishing slavery?drive to mechanization

22
Technological Advance
  • Mold board plow 1837
  • Mechanical reaper
  • Corn planter
  • Grain drill
  • Steam engine-? gasoline powered tractors

23
Impacts of Technology
  • Reduced the demand for labor
  • Increased productivity
  • Farm size could expand
  • Developed of farm machinery sector
  • Increased capitalization
  • Reliance upon purchased inputs
  • Specialization in farming

24
Late Pioneer Period
  • Need for education became apparent
  • Land Grant Universities
  • Morrill Act 1862
  • Hatch Act 1867
  • Smith Lever Act 1914
  • Agricultural Societies
  • Local Fairs

25
The Last Frontier
  • 1860 land west of the line from St Paul to Fort
    Worth was largely unsettled
  • 1860-1900
  • 500 million acres were disposed of
  • 80 million Homestead Act
  • 108 million through auctions
  • 300 million as grants to the railroads

26
Period of Great Farm Building
1860 -- 407 million acres in farms 1900 -- 839
million acres in farms
Fa r ms
5.5 million
1.9 million
1900
1860
27
Following the Civil War
  • Agriculture enters into a recession that lasts
    until 1900
  • between 1870 - 1880
  • population increased 26
  • production rose 53

28
Hard Times The Agrarian Revolt
  • meeting high land prices with declining gross
    incomes
  • seeking out reasons for tough times on the farms
  • railroad rates, agribusiness
  • overproduction
  • plight in newly settled western states

29
Farmers Response to Tough Economic Times
  • Organize and act collectively
  • Grange (Patrons of Husbandry) regulate
    railroad
  • Farmers Alliance cooperatives
  • Populist Movement - William Jennings Bryan
  • Farm Bureau1911
  • Farmers Holiday Movement--1932
  • Turn to government for assistance
  • USDA - created in 1862
  • US Army - distributed rations to western settlers

30
Post Civil War Recession
  • farmers sought relief by urging government to...
  • curb the power of monopolists
  • create a flexible and liberal monetary system
  • reform the tax system

31
Post Civil WarRecession/Depression
  • creates recognition for the need to address
    poverty in rural America
  • need for modernization
  • requires technology science education
  • sets the stage for modernization development
  • technology
  • education
    Reform
  • business orientation
    Movement
  • cooperation

32
The BIG Picture
1897 - 1920 Prosperity 1920 - 1933 Depression
33
Important Trends
  • Urbanization
  • Mechanization
  • Reliance upon purchased inputs
  • Economic instability

34
Important Iowans
  • Milo Reno
  • Tama Jim Wilson
  • Henry Wallace
  • Herbert Hoover
  • George Washington Carver
  • Charles Hart and Charles Parr
  • Orlan Staley
  • Tom Vilsack

35
Important Dates
  • 1607 founding of Jamestown
  • July 4, 1776 Declaration of Independence
  • 1862
  • USDA, Morrill Act, Homestead Act
  • 1908 Country Life Commission
  • 1910-1914 Golden Age of Agriculture

36
1897 1933 The Beginning of Scientific
Agriculture
  • 3 Essential Components
  • 1) The discovery of scientific relationships
  • 2) The development of new technologies
    based upon these scientific relationships
  • 3) The adoption of new technologies on farms

37
The Ups and Downs of the Farm Economy
1865 Civil War ends
1897
1920
1918 WWI
1940-1945 WWII
1929-1932 Great Depression
38
The Technology Revolution1933 - 1970
  • Great Depression 1929 - 1932
  • organized
  • sought government intervention
  • adopted new technologies

39
Technological Revolutions
  • 1) Mechanical 1890 - 1940
  • 2) Petro-chemical 1945 - 1980
  • 3) Bio-genetic 1980
  • 4) Managerial 1980

40
Four Revolutions in Farming
  • 1. Mechanical 1890-1940
  • Machine Age/Mechanization
  • Replacing animals and labor with machines

Fig. 3
41
Four Revolutions in Farming
  • 2. Petro-Chemical (1950-1980)
  • Energy intensification, fertilizers,pesticides,
    reliance upon fossil fuels
  • Genetic improvements
  • Hybrids
  • Vaccines

Fig. 4
42
Four Revolutions in Farming
  • 3. Bio-Genetic (1980? )
  • Recombinant DNANew
  • species and varieties
  • Herbicide tolerant crops
  • BST, BGH
  • Hybrids-Designer commodities
  • New Uses of existing products
  • Biological control of diseases and
  • pathogens
  • 2004200 million acres of genetically
  • engineered crops, up 20 from 2003

Fig. 5
43
Four Revolutions in Farming
  • 4. Managerial Revolution
  • Information Age
  • Managing complex, integrated systems
  • Globalization
  • Importance of human resources
  • Personnel Management
  • Marketing
  • R D
  • Communications

Fig. 6
44
Millions of Farms
6.8
2.0
1865
1920
1992
Period of Great Farm Building essential
factors land credit technology markets transp
ortation physical infrastructure social
infrastructure
Period of Great Farm Decline
45
Bio-genetic Managerial
Industrial
Petro-chemical
46
  • Labor Declines
  • 1940 - 50 26
  • 1950 - 60 35
  • 1960 - 70 39
  • Purchased Inputs ( increase from 1933 - 70)
  • Machinery 212
  • Chemicals 1800
  • Feed/Seed 270

47
WWII -- the miracle that farm people were
waiting for (Cochrane p. 124)
Impacts of WWII 1940 - 46 farm prices up
138 gross farm income up 167 net income
up 236
  • 12 years of prosperity
  • massive rural to urban migration
  • farm population down 35 in 14 years (1939 - 53)
  • women entered the off-farm work force

48
Trends in the structure of agriculture
  • Farm consolidation
  • Larger farms
  • Decline in farm numbers
  • Specialization in production
  • Movement from general farms to very specialized
    farm types

Fig. 1
49
Consequences
  • Loss of farm population (out migration)
  • Rural neighborhoods vacant during the day, owing
    to larger numbers of part-time farms
  • Aging of farm population
  • Fewer opportunities for beginning farmers
  • Technology enables farmers to continue farming
    longer
  • Increase in rural nonfarm residences and land
    speculators and investors

Fig. 3
50
Consequences
  • Vulnerabilities of specialization
  • Less labor needed
  • More capitalization of existing farms
  • Increased efficiencies resulting in chronic
    surpluses of feedstocks
  • Government program costs to support farm
    income?higher land values

Fig. 2
51
  • Enhanced income spurred adoption of new
    technologies
  • many technologies that substituted machinery for
    human and animals
  • Henry A. Wallace/ISU--hybrid seeds
  • Farm consolidation
  • farm numbers decreased/farm size increased
  • net output increases because of more efficiency
    chronic excess capacity

52
Responses to rural poverty
  • Ignore/deny problem and minimize its impact
  • Blame is a collective character flaws
  • Blame the victim
  • Emphasize development
  • Community
  • Rural
  • Economic

53
Responses
  • Agriculture support programs and policies
  • Target prices
  • Deficiency payments
  • Income payments
  • Welfare programs
  • Food stamps
  • Unemployment benefits
  • ADC
  • Push for improved efficiency and productivity
  • Drive for industrialization

54
Poverty and Industrialization
  • In a response to declining or stagnate conditions
    agriculturalist turned to industrialism
    emphasizing productivity, efficiency, and outputs
    (Yields)
  • Implication of Industrialization
  • Increase use of purchased (off-farm) goods
  • Increase capital inputs
  • Decrease labor requirements
  • Increase use of Technology
  • Increase outputs (and therefore surpluses)

55
Routes to Rural Poverty
  • Decline in labor
  • Technology
  • Capital intensification
  • Completive Losses
  • Some farmers are ill-equipped to handle change or
    new complexities
  • Unable to respond well enough to upturns in
    economy
  • Discrimination or the residual in rural areas
  • American Indians
  • Blacks

56
Stages of Adoption
  • Awarenessdiscovering the existence of a new idea
    or product
  • Interestsystematic gathering of information
    about it, how does it work, what does it cost
  • Evaluationputting innovation through a mental
    trial, trying it out in their mind
  • TrialTrying the product or technology
  • Adoptionfinal decision to accept or reject

57
Sources of Information
  • Awareness mass media, newspaper, magazines,
    radio, TV
  • Interest (information gathering)commercial
    firms, friends, neighbors, dealers
  • Evaluation friends, neighbors, dealers

58
People Differ in Speed of Adoption
  • Innovators 2.5
  • Early Adopters 13.5
  • Early Majority 34.0
  • Late Majority 34.0
  • Laggards 13.5
  • Non-adopters 2.5

59
Early Adopters 13.5
Innovators 2.5
Early Majority 34
Late Majority 34
Laggards 13.5
Nonadopters 2.5
60
Changes in Agriculture
  • Decline in farm numbers
  • Increased farm size
  • Fewer medium-sized farms
  • More hobby farms
  • Off-farm income up
  • Farm dependence down

61
Changes in Rural Communities
  • Population mix change
  • Commuting
  • Lifestyle choices
  • Linkages to urban places

62
Changes in Rural Communities
  • Population shifts have been a constant
  • Decline in farm population, migration to urban
    areas for employment
  • Return from urban to rural areas for amenities
  • Since 2000, population decline in 76 of 99
    counties
  • IFPRL 08 Farmers lived in current community
    average of 50 years
  • 30 lived in community whole life, 60 more than
    75 of their lives

63
What is ethics anyway?
  • Standards of conduct
  • Standards that indicate how one should behave
    based upon moral duties and virtues
  • Principals of right and wrong
  • As a practical matter, ethics is about how we
    meet the challenge of doing the right thing when
    that will cost more than we want to pay.

64
Aspects of Ethics
  • Ability to discern right from wrong, good and
    evil, propriety from impropriety
  • Commitment to do what is right, proper and good.
    Ethics entails action not just thoughts

65
What is meant by ethics?
  • Helps us discern what is right or wrong
  • Doing what the law requires
  • Standards of behavior
  • Doing what society expects
  • Standards of right and wrong that prescribe what
    people ought to do in terms of rights, benefits
    to society, fairness, etc

66
  • Standards of behavior that tell us how people
    ought to act in many situations in which they
    find themselves in
  • Utilitarian Approach
  • The Rights Approach
  • Fairness or Justice
  • Common Good
  • Virtue

67
Four simple questions
  1. Could you or someone else suffer physical harm?
  2. Could you or someone else suffer emotional pain?
  3. Could the decision hurt your reputation,
    undermine your credibility, or damage important
    relationships?
  4. Could the decision impede the achievement of any
    important goal?

68
Seven Steps to Better Decisions
  1. Stop and think
  2. Clarify goals
  3. Determine Facts
  4. Develop options
  5. Consider consequences
  6. Choose
  7. Monitor and modify

69
What happens when there is not adherence to a
code of ethics?
  • People begin to cut corners
  • Most unethical and illegal activities start small
  • Rationale or justifications often include,
    everyone else is doing it
  • Erosion in ethics brings about greater regulation
    because trust has been violated
  • Rules, regulations and laws reflect the
    formalization of ethics

70
Causes of the farm crisis in the later 1980s
  • Flawed government policy
  • World expansion of grain
  • Overly optimistic projections
  • Favorable global weather
  • Food self sufficient
  • Increased global competition

71
Need to make the distinction between Farm
Crisis and Long-term Chronic Problem
  • This was a restructuring process
  • Broader than farming
  • PainfulDifficult
  • Transitions are hard

72
Community Impacts of Economic Hardship in Farming
  • Economic What does it mean for the
    financial well-being of the community?
  • Social What does it mean for the social
    fabric of the community?

73
Responses to economic hardship
  • 1. Cut back on living expenses
  • Earn more money, attempt to generate more income
  • Dip into savings
  • Borrow and use credit
  • Withdraw from social activities

74
Social or Community Impacts
  • Fewer farms translates to fewer farm families
  • consolidation of rural organizations and
    institutions, e.g., schools and churches
  • revenue declines among businesses that serve the
    needs of farm families
  • Multiple job holding
  • more part-time farming
  • less time for community activities

75
Are the current problems acommodity price
problemor a farm income problem?
76
Making the Distinction BetweenPersonal Problems
and Social Problems
  • When one farmer has financial problems, we can
    conclude that this is a personal problem.
  • When an entire group or class of individuals have
    financial problems, we should conclude that this
    is a social problem.

77
The prescription for the farm ills during the
past 70 years was to emphasize individual
adoption of new technology with little or no
regard to implications for farmers as a group.
78
Those who failed to accept this prescription were
labeled as social deviants
  • Laggards
  • Luddites
  • Romantics
  • Radicals
  • Consumerism
  • Tree-huggers
  • Environmental wackos

79
Production Costs
Commodity Prices
Attempts to IncreaseFutures, Hedges,
OptionsCooperative Action
Attempts to DecreaseSustainable FarmingIPM,
ICM, BMP
80
Maybe focus should be on developing a new food
system rather than trying to preserve an obsolete
and antiquated commodity system.
81
Characteristics of the Old Commodity System
  • Production of homogenous bulk commodities
  • Standardized production systems
  • Focus on volume, scale, size, and efficiency
  • Large scale production, transportation and
    processing
  • Impersonal and indifferent to individual needs
    and niches
  • Food viewed as fuel

82
  • Sharp distinction between producers and consumers
  • Product was produced and then sold through some
    market structure that may or may not be regulated
    and fair to all parties
  • Buyers and sellers are adversarieseach looking
    out for their best interests
  • Focus was on individual whether it be a person,
    farm, or firm

83
Emerging Characteristics of a New Food System
  • Designer commodities, crops grown for specific
    end uses
  • Explosion of new crops and products resulting
    from biotechnology
  • Emphasis on batches, small niches
  • Focus on food safety and quality
  • Food shopping and eating as a social experience

84
  • Linkages between producers and consumers
  • Crops grown under contract to meet expectations
    of buyer
  • Product is specified, terms negotiated, produce
    is grown, and then delivered
  • Buyers and sellers are partners
  • Focus on group, network, coalition

85
Why are transitions hard?
  • Social and economic change are not neutral
    processes
  • They produce gains for some and losses for others
  • How to cope with losses

86
Losses include
  • Decline in financial security
  • Loss of status
  • Stigma/Labeling
  • Separation/Identity
  • Feelings of unfairness
  • Guiltself-blame
  • Feeling of inadequacy

87
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88
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89
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90
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91
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92
  • 5 Percent of the U.S. farms (116,286) accounted
    for 74 percent of the total U.S. agricultural
    sales in 2007
  • 19 percent of our total food bill is farm value

93
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94
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95
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96
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97
What is the future of Agriculture?
Can agriculture progress positively from its
current point? Will it simply continue at a
status quo? Is the only direction we go from
here a negative one?
98
Future
  • Iowa is moving towards more dispersed land
    ownership and more concentrated land management.
  • Iowa will continue to see more farmers owning
    part of their land and renting the rest
  • There will be an increase in cash rents
  • There will continue to be more people who own
    land that do not live in the State.

99
Factors to Watch
  • We are entering into a period of major
    uncertainty. How the current financial situation
    will play out no one knows for sure.
  • Land values will move with higher income and
    anticipation uncertain where they will go
  • What will the next generation of landowners do
    with the land
  • When will we recognize other costs in our
    production and distribution systems
  • We must get better, not bigger.

100
Bioeconomy
  • Biofuels have the potential to transform
    agriculture more profoundly than any development
    since the green revolution and help resolve some
    of the worlds most intractable problems related
    to energy.
  • (Worldwatch Institute, 2006 xix)

101
The Claims
  • Proponents argue
  • Deliver energy independence
  • Revitalize rural communities
  • Biomass production biofuel refineries
  • New source of farm community income,
    employment, investment

102
The Claims
  • Curtail global warming
  • Reduce greenhouse
  • gas emissions (GHG)
  • Biofuels gasoline produce CO2
  • Biomass (i.e. corn) absorb CO2 while growing
  • Net reduction in GHG

103
A. Conservation Reserve Program (CRP)
  • Largest government conservation program
  • 1985 Farm Bill
  • Environmental goal
  • Curtail soil erosion, improve water quality,
    provide wildlife habitat
  • Take at risk land out of production
  • Keep it/convert it to grass, trees,
    soil-conserving covers
  • Farmers receive annual payment for enrolling
    environmentally at risk land
  • Decade-long contracts

104
A. Conservation Reserve Program (CRP)
  • Program peaked 2007
  • 400,000 farmers enrolled
  • receiving 1.8 billion
  • 37 million acres (gt8 of cropland in the
    country).
  • land mass bigger than New York state
  • Iowa 1.9 million acres enrolled

105
B. The Dead Zone
  • 2008 dead zone 7,988 sq. mi (size of
    Massachusetts)
  • second largest in history
  • Directly linked to ethanol production
  • If farmers produce enough corn to meet goal of 15
    bg of ethanol, nitrogen runoff into Gulf would
    increase 10
  • Efforts to shrink dead zone practically
    impossible"

106
C. Deforestation
  • Expansion of biofuel production deforestation
  • Brazil (Amazon, Cerrado), Indonesia, Malaysia
  • Aug 2007-Aug 2008 Amazon deforestation up 69
  • 5,000 sq miles
  • Loss of biologically rich ecosystems
  • Loss of fragile wildlife habitats
  • Increase in carbon emissions
  • global warming

107
End of the Ethanol Boom?
  • End 2008 a perfect storm
  • Global economic crisis, financial credit crisis
  • Decline in gasoline consumption
  • Oil, gasoline prices plunged
  • Corn prices remain relatively high

108
End of the Boom?
  • Bankruptcy and plant closures
  • 10 companies closed 24 plants
  • dozen more companies in distress
  • idled 2 billion gallons annual production
    capacity
  • industry not expected to meet government
    production targets
  • Solution?
  • Industry demanding increases to blend limit
    (currently 10)

109
Conclusion
  • Must consider social, economic, environmental
    consequences of alternative energy
  • Ethanol cannot resolve problems of growing demand
    for energy, oil dependency, and global warming
  • What alternatives?
  • Conservation?
  • Cellulosic? Wind? Solar?

110
ENTREPRENEURCHARACTERISTICS
  • Desire for independence
  • Recognizes business opportunities
  • Willingness to take calculated risks
  • Ability to function in an uncertain environment

111
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112
SURVIVAL FARMER ENTREPRENEURS
  • Struggle to achieve success, but may lack skills
    or resources to recognize or capitalize on
    opportunities
  • Forced into entrepreneurship because they operate
    marginally profitable farms and need additional
    income
  • Lack of other employment opportunities or
    unwillingness to work for someone else makes
    creating a new business a reasonable alternative

113
LIFESTYLE FARMER ENTREPRENEURS
  • Operate profitable farms and have surplus
    resources such as time, knowledge, skills, and
    money for which they seek investment
    opportunities
  • Have modest goals for growth and income because
    the business exists primarily to provide extra
    financial resources to enhance a way of life
  • Although the entrepreneurs interest for the
    business may not be expansive growth, it provides
    the community with economic benefits through the
    creation of some jobs and income

114
HIGH-GROWTH VENTURE FARMER ENTREPRENEURS
  • Operate profitable farms and have surplus
    resources such as time, knowledge, skills, and
    money for which they seek investment
    opportunities
  • Ventures create new wealth by developing new
    products, production processes, and/or markets
    (Schumpeter)
  • Desire significant growth that may tap national
    and international markets and require the
    development or construction of substantial new
    physical infrastructure
  • Leads to considerable economic activity in jobs
    and income with the potential of ancillary
    business establishment and growth

115
Why should society be concerned about the
structure of local business?
  • Population retention and quality of life reflects
    opportunities
  • The life blood of many of Iowas 839 rural
    communities depends upon farming and rural
    population
  • The viability of social institutions depends upon
    opportunity structure

116
Challenges for Iowas Agriculture
  • Fewer farmers, particularly mid-size operators
  • Economic deterioration of rural communities
  • Strong dependence on purchased inputs and subsidy
    payments
  • Degradation of water resources

117
Federal Agricultural Payments to Iowa, 1995-2006
Farming subsidies 13.5 billion (84)
Conservation programs 2.3 billion (14)
Disaster payments 0.2 billion (2)
Total 16.0 billion
Source Environmental Working Group,
http//www.ewg.org
118
How Could Iowas Agriculture Thrive?
  • Diversification of cropping systems, especially
    with perennial species
  • (Re) Integration of crop and livestock systems
  • Strategic use of conservation practices
    (targeting)

119
Perennial vegetation
  • Builds and conserves soil
  • Captures and stores carbon
  • Holds and recycles nutrients efficiently
  • Retains and filters water
  • Provides wildlife habitat
  • Assists in regulating certain pests

Photo courtesy of J. Neal, Leopold Center
120
Can diversified cropping systems reduce
reliance on agrichemicals and fossil fuels, while
maintaining or improving productivity,
environmental quality, and profitability?
121
Yields and economic returns from
certain low-external-input (LEI) systems can
match or exceed those from conventional systems,
under conditions of high production potential.
122
Policies should promote compensation of farmers
for
  • Soil, water, and wildlife conservation
  • Carbon storage
  • Biofuel feedstock production
  • Food and feed production

123
Business Success is Dependent upon
  • Understanding the large scale social and economic
    forces
  • Positioning oneself to take advantage of the
    opportunities that lie ahead
  • Learning to read the market
  • Willingness and ability to change

124
A major challenge of the future
  • Ability and willingness to change to new
    opportunities
  • Accepting change is not easy
  • Thus we often ignore market information and miss
    opportunities
  • Hard work is not sufficient--failure to respond
    to market signals

125
Important Trends and Forces Influencing
Agriculture
  1. Re-assertion of Cultural Values and Beliefs
  2. Economic Restructuring
  3. Population Shifts and Dynamics
  4. Population growth reflects opportunities
  5. Occupational changes
  6. Personal safety is becoming more important

126

1990- 2000
127
Business Success is Dependent upon
  • Understanding the large scale social and economic
    forces
  • Positioning oneself to take advantage of the
    opportunities that lie ahead
  • Learning to read the market
  • Willingness and ability to change

128
A major challenge of the future
  • Ability and willingness to change to new
    opportunities
  • Accepting change is not easy
  • Thus we often ignore market information and miss
    opportunities
  • Hard work is not sufficient--failure to respond
    to market signals

129
Consumer Driven Agriculture
  • Aging baby boomers, those born between 1946-64
    will approach 54 million by 2020
  • Market growth and potential for older population,
    less active, higher standard of living
  • More expensive cuts of meat, exotic vegetables,
    luxury food items, ready to eat, higher priced
    restaurants, etc.

130
Consumer Driven Agriculture
  • Per capita income growth is projected to be about
    1 annually between 2000-2020, compared with
    1.2 that occurred between 1988-98
  • Key question is how much of this higher
    disposable income will be spent on food and what
    types of food will be demanded

131
Consumer Driven Agriculture
  • Projections are
  • More fruit, vegetables, fish, poultry, cheese,
    yogurt and prepared foods
  • More eating out
  • More attention to diets, health and wellness

132
Consumer Driven Agriculture
  • Population projections
  • 2002 2020
  • Hispanics 12.6 18
  • Asians 3.9 5.0
  • Whites 71.0 64.0
  • Blacks 12.0 13.0
  • U.S. population stands at 281 million and by 2020
    will grow to about 331-361 million (50-80
    million).

133
Risk Communication Recreancy
  • The solution might lie in the recreancy theorem,
    which asserts that public trust in societal
    institutions reflects assessments of the
    competence and fiduciary responsibilities of
    institutional actors.
  • Where Competence refers to perceptions of
    expertise and skill, and Fiduciary Responsibility
    refers to perceptions that the source will behave
    with in the right way (ethically).
  • Fiduciary Responsibility can also be called
    Confidence.

134
Risk Communication Recreancy
  • Our theoretical model can be diagrammed like this
  • Where Compliance refers to willingness to heed
    the recommendations of others. This variable is
    used to evaluate the external validity of the
    measure of trust, as an indicator of commitment
    to a source of information.

135
The W.W. Kellogg Foundation named the movement
and brought in health movements and the farmer
worker movements
  • Healthy
  • Green
  • Fair (to farmers and farm workers)
  • Affordable

136
Local was added by other movement actors,
influenced by
  • Smart Growth movement
  • Community-based economy movement
  • Anti-globalization movement
  • Climate change concerns

137
Forms of Capital
  • Natural
  • Cultural
  • Human
  • Social
  • Political
  • Financial
  • Built

138
To be successfulyou need to
  • Figure out how you can become the low cost
    producer against everyone who is producing the
    same products as you.
  • OR
  • Figure out a niche where there is limited or no
    competitionwhere you offer a superior, highly
    differentiated product.

139
Consequences of these trends
  • Farm consolidation
  • Specialization in production
  • Movement from general farms producing a wide
    variety of crops and livestock to one or two
    commodities
  • Vulnerabilities of specialization
  • Fluctuations and increased risk

140
Secondary Consequences
  • Decline in farm numbers
  • Larger farms
  • More capitalization of existing farms
  • Aging of farm population
  • Fewer opportunities for beginning farmers
  • Technology enables farmers to continue farming
    longer

141
What are Farmers Predicting for the Next 10 years
(1999-09)?
  • 99 likely that farm number will continue to
    decline
  • 95 low farm prices will put many out of business
  • 96 more reliance on off-farm income
  • 82 cost of living will prevent many from
    retiring at age 65

142
Directions in Economic Development(2001 Farm
Poll)
  • 67 tax incentives for employers who hire Iowa
    graduates
  • 69 emphasize production agriculture and
    related industries
  • 76 raising wages is needed to attract and
    retain people
  • 67 emphasize main street development
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