Family Farm Legislation: Who Are We Protecting?
by Richard A. Levins We've had programs to protect family farms for decades, and there are dozens of conflicting efforts to define them. But we have yet to agree on exactly what a family farm is.
We count "farms" and put policies in place to protect "family farms" without being able to say this farm is a family farm, but that one is not. It is little wonder that our programs have performed so poorly.
Family Income And Family Farms
In 1999, USDA recorded slightly fewer than 2.2 million farms in the U.S. Certainly the number of family farms is much smaller, but beyond that, we can't be precise for a very simple reason: we don't know exactly what to count.
A "farm," according to USDA, is "any establishment from which $1,000 or more of agricultural products were sold or would normally be sold during the year." A person selling a single beef animal for slaughter in a year when prices were high would qualify; otherwise, it would take two such animals to make the grade. Or, if that person put all the land into the USDA-paid Conservation Reserve Program, thereby agreeing to produce no farm products, the land is still counted as a farm.
Are all of these farms family farms? Most observers would say "no" for a variety of reasons. For example, a family farm is often thought to be a place that can provide a significant part of the family's income. This is obviously impossible with annual sales of $1,000. Most economists agree that a farm would have to sell at least $100,000 in a year to provide an average, full-time living for a single family. If so, fewer than 350,000 USDA farms would be family farms.
We might also worry about whether a USDA farm is too big to be called a family farm. Murphy Family Farms is a good example. In his heyday, Mr. Murphy raised over six million pigs on 500 sites spread out over six states. His annual sales were in the $775 million range and "Forbes" magazine proclaimed him a billionaire. Mr. Murphy, who has since sold out to an even larger conglomerate, seems a distant cousin, at best, to Old MacDonald. In 1999, 36,000 U. S. farms had sales greater than $500,000.
Raising Chickens Is Not Farming? Farm income is not the only challenge in defining a family farm. For example, shouldn't the family farmer manage the farm in addition to providing most of its labor supply? Here, the definition of a farmer takes an unexpected twist. In Minnesota, the corporate farming law says farming "does not include the production of poultry or poultry products." But in 1995, USDA reported 12,479 farms in the U.S. that produced broilers under contract with large processing companies. The Minnesota law excludes these operations because the people working on them do not make most of the important management decisions; they are more akin to farm employees than to farm managers. A 1997 USDA study found almost one-third of all U. S. farm products, not just poultry, were grown under contract, and that number has grown.
Ownership, too, plays a role. We often assume that a family farm is owned by its operator. This makes sense, but another USDA statistic comes into play: only 28.6% of farmers in 1998 owned all of the land they farmed. The others rented some or all of their land. Are two-thirds of what the USDA considers farmers not family farmers simply because of their ownership status? Nationally, non-farmers own over 40% of all farmland; in parts of the Midwest, it's closer to 65%.
First Steps For Policy How big is a family farm? Can contract poultry production be part of a family farm operation? Is a family farmer an owner and an operator, or can he or she rent land? How much of the labor on a family farm must be supplied by the family, and how much can be hired labor? As basic as these questions seem, we have often sidestepped them in farm policy. Either we have assumed that all farms are family farms, or that any program that helps all farms will help family farms.
In federal legislation, a threatened species such as the snail darter has a significant advantage over family farms. We know exactly what a snail darter is. Because of this advantage, we don't talk about protecting generic fish in federal legislation. We talk about protecting a particular kind of fish, and then back it up with legislation powerful enough to delay a federal dam project that compromised the snail darter's habitat.
But family farms are treated as undifferentiated fish, not as a unique species. If snail darters were farmers, we would either assume that all fish were snail darters, or that any program that helped fish would help snail darters. Of course, this would be laughable, yet this is how we have approached protecting family farms.
A first and basic step for farm policy must be a public discussion where we clearly define the type of farm to be given special protection. Questions of size, ownership, and management must be answered so we can say, "this farm is to be protected by federal policy" and "that farm is not to be protected by federal policy." A special follow-up study should determine how many of our nation's farms meet the definition.
Then we'd be ready to take effective, well-targeted action. New programs could be designed to protect the type of farm we had designated most important. What these programs contain would take considerable thought. But such thought must be guided by a clear, well-accepted definition of what we are trying to protect.
Richard A. Levins is a professor and extension agricultural economist at the University of Minnesota and a senior fellow with the Institute for Agriculture and Trade Policy. He has recently authored the book, "Willard Cochrane and the American Family Farm" (University of Nebraska Press). Contact information: Department of Applied Economics, U of M, St. Paul, MN 55108, 612-625-5238, firstname.lastname@example.org.
Click below for the previous stories in the series, written by agricultural economists and marketing specialists, offering information on the 2002 Farm Bill.