Although I live on the East Coast far from the current drought, I get periodic reports from the front lines from my sister, who lives with her husband in eastern Kansas on 70 acres of grass and woodland. When I visit them next week, I’ll see for myself the brown expanse of grass that used to be their lawn and the ever-lower water level in the catfish pond. They have harvested their hay field early and stored it to help feed their three horses, especially important now that local hay supplies are tight and prices are skyrocketing.
Of course, commercial farmers in in Kansas and nearby Missouri face far more dire consequences from the drought. As they look out over parched fields and cloudless skies, they see their mainstay crops, corn and soybean, drying up—along with this year’s income.
Parched fields are always a sickening sight to farmers, although government-subsidized crop insurance will cushion the financial blow for most commodity growers. Taxpayers will be on the hook for billions, but the farmers’ distress cries out for relief.
Drought: the new normal?
A widespread drought like this one is a jolt to farmers and non-farmers alike because it is so rare. Although severe drought hit parts of Texas last year, the last drought of this magnitude to afflict the American heartland was in 1988. The 25-year run of good weather since then has been a godsend but it would be unreasonable to think it is the norm.
Going forward, we should expect droughts and other weather extremes. Of course, Mother Nature has served up disastrous droughts in the past on her own. The infamous Dust Bowl of the 1930’s lasted seven long years. But we are now in the grip of a changing climate that will exacerbate weather extremes such as droughts, excessive heat, floods, and intense downpours.
From here on out, we should anticipate weather shocks. We can’t avoid them, but we can design agricultural systems to better withstand them.
We need a broader portfolio
The best way to hedge against uncertainty in agriculture—just as in finance—is to diversify the portfolio. Whether the weather brings excessive heat or pounding downpours, some part of the system will be able to make the best of it.
During my road trip through the Midwest next week, I’ll get to see firsthand how far the United States is from a diversified agricultural portfolio. Instead of fields of diverse grains, legumes, fruits, and vegetables, I’ll be driving through field after field, county after county, and state after state of corn and soybeans—this year 96 million acres of corn and 74 million acres of soybeans. Our agriculture is like a stock portfolio with shares in only two companies, making it extremely vulnerable to adverse circumstances.
What’s stopping us?
Why have we ended up in this position? The Midwest contains some of the richest farmland on earth. It would support any number of crops. Why don’t we grow them? One reason is that long-term considerations rarely come into play in farm policy discussions. Perhaps 25 years of relatively benign weather has lulled us into complacency.
Whatever the reason, most farm policy has been focused on keeping prices high and the current population of farmers prosperous. Short-term thinking in agriculture creates a peculiar dynamic that blocks the path to diversity. Substantial acreage in corn creates pressure for new uses of the crop—as fuel, feed, sweeteners, and oils, in addition to sweet corn and corn chips. Multiple uses keep prices up and entice farmers to plant more and more.
As larger numbers of farmers commit to corn, they become an ever more powerful political lobby for policies to protect their profits. Unlike shoemakers—or even farmers with fruit and vegetable operations—large commodity crop producers can use the Farm Bill to obtain subsidies that kick in when market prices drop (or even when they don’t). They also can command the resources for heavily subsidized crop insurance and generous emergency payments. The result is a reinforcing spiral: More corn means more power means more corn.
While this dynamic meets the needs of today’s farmers, it stands as a barrier to the emergence of a resilient agricultural system. The well-being of future farmers and consumers commands little attention on the Hill. The farmers of the future don’t show up in the halls of Congress.
More than any other feature of our agriculture, excessive dependence on corn and soy makes us vulnerable to the weather-related stresses that lie ahead.
Unless we confront it head on, this policy blind spot will cost taxpayers billions to bail out corn and soy farmers hit by extreme weather. We need to take the future seriously and design an agricultural system to cope with it and that means fundamental changes in what we grow. We need to start identifying and promoting more crops and to do that we will need to give the future a place at the farm bill policy table.