It’s a tragic paradox — record numbers of Americans experiencing food insecurity, even as producers are dumping milk, plowing under crops, and euthanizing chickens and baby pigs.
The world’s wealthiest nation has long ago achieved the goal of producing an abundant food supply at low cost — about 10% of consumer disposable income is used for food, leaving the remainder for other goods and services.
Advances in agronomic and mechanical technology, and economic efficiencies achieved through economies of scale, have not been without some costs. Technical advances resulted in substitution of labor intensive production with capital intensive production methods. While reducing hand labor, increased capital required producers to take advantage of economies of scale, resulting in fewer and larger units of production.
Effects of these changes on the environment are mixed. On the positive side, replacement of the conventional moldboard plow with no-till or minimum-till equipment has reduced soil erosion. However, replacement of mechanical cultivation of row crops with chemical application has negatively affected water resources. In this neck of the woods, the replacement of traditional crop rotations with monoculture has reduced the natural control of pests while requiring greater use of chemicals. The replacement of small scale cattle, hog and poultry operations with huge factory farms in many parts of the nation has had some tragic effects on water and air pollution, especially regarding manure disposal. The trend toward fewer and larger farms has been accompanied by tremendous broader social costs. In short, the result has been an “emptying out” of much of rural America. Many small towns across the Great Plains and the Midwest are virtually drying up. Capital intensive agricultural production requiring fewer farmers and farm hands mean fewer customers for small town grocery stores, clothing stores and other Main Street merchants. It means fewer children for local school districts. Children raised in these areas either move to areas of greater opportunity, or remain, and struggle economically.
One of my friends, a University of Nebraska agricultural economics professor, tells me that a disproportionate number of its College of Agriculture’s highest performing students were from the scenic Nebraska Sand Hills. When he asked them how this came to be, they told him that, as gorgeous as those Sand Hills are, they realized there was no economic opportunity there, and they had better take advantage of a good education at the U. of Nebraska. So, they hit the books.
Farm implement dealerships followed the trend toward fewer and larger, with many small town dealerships disappearing. Remaining farmers and small town residents find it easy to travel a few miles to a larger town to buy their goods at supermarkets and big box stores rather than the smaller local shops, even if they still exist at all.
Some of the larger rural county seats and regional economic centers are still doing fine, especially those that are within commuting distance of larger cities. But the smaller towns with declining populations, and out of commuting range of bigger cities, are not.
The trend toward fewer and larger includes consolidation of dairy, meat and poultry processing. Not only have these plants specialized in their processing operations, but specialization is extended to marketing. These changes have contributed to low costs at the consumer end. Like a sophisticated machine, it all works well until something goes wrong. And, according to Murphy’s first law, if something can go wrong, it will.
In this case, the coronavirus has interrupted that efficient chain from the farm gate to the ultimate consumer, be it the supermarket shopper, diners in restaurants, or even the unfortunate visitor to the food bank.
One obvious interruption in this food chain is the vulnerability of meat packing workers to the coronavirus. These workers, many of them immigrants, are at the low end of the pay scale, work long hours at grueling, sometimes dangerous, work, and often without adequate safety protections. The recent outbreaks and rapid spread of the disease in these packing plants is not incidental, nor is it the result of their “off duty lifestyles,” as some politicians allege.
It should not have taken this public health and economic crisis to recognize the importance of these workers in the food chain. When workers get sick, the plant shuts down. With interruption of the “on-time” link of large factory hog producers coordinated with timing of the packing plant, the producer flow of birth of pigs, to feeding, to final sales also backs up. With no place to sell pigs, they are euthanized as the flow from packing plants to supermarkets shuts down.
The efficiencies gained through specialized marketing of products are nullified when something goes wrong. Why are producers dumping milk when unemployed workers can’t afford to buy groceries? Over half of food expenditures are through sales to restaurants and institutions — hospitals, and school districts, for example. The packaging is different for these outlets than for supermarkets. With more people unemployed or working at home, demand for food at home has increased as demand for food for restaurants and institutions have dramatically declined.
In the long run, markets could adapt. But changes are costly, and processors cannot be expected to bear the cost of these changes if they are temporary. Hence, the paradox — an abundance of product accompanied by sporadic shortages at the end of the chain, all while the world’s wealthiest nation’s unemployed workers and those at the bottom of the income scale depend on food banks and the federal Supplementary Nutrition Assistance Program.
This pandemic for which the nation was woefully unprepared brings to light a number of problems and issues that have been here all along, but ignored and unaddressed.
It also reveals the vital role of smaller local food producing and processing operations, and opportunities for them as well.
— John Waelti’s column appears every Saturday in the Times.
