No big secret, life in Iowa is different. Taking a bus or the light rail to work shop or entertainment opportunities is as convenient and as practical and as likely as riding a dragon to those events. We are not among the highest compensated states for a number of professional service providers (Dr., Dentists, Lawyers, engineers, and the like) but also some of our costs of living are less. Basic food, housing and living costs are less in the rural area.
That doesn’t help when we Iowans cross the mighty Mississippi or Missouri rivers and venture to the coasts. The house of mouse and where the wizard lives amusement parks don’t provide a midwestern rate. Nor do the hotels or food establishments. But we have always known that.
Remoteness also doesn’t help on fuel. We are a driving society. We drive everywhere to get anything and to work. It appears that fuel costs for an average household is going up $2500 compared to two years ago. That that comes out of the vacation and capital improvement fund. Or they are going to turn to credit cards and HELOCS (Home equity loans), those are dangerous events that quickly erode financial stability.
Some economists think small communities nearer the employment and shopping centers may see an increase in demand for housing as rural populations grudging relocate to housing closer to the areas that provide the essential services they need. The question is, do they have the capacity and infrastructure, the lots and the incentives to welcome those who might decide a 20-mile drive is more palatable to the wallet than the 50-mile drive? Also, people who live in rural areas generally do so purposefully (whether by lack of resources to leave, family ties, or a desire to stay local). It may not be a mass exodus, but rather a slow migration if at all.
Combine this information with the realization that, while farmers rarely really retire, more than ½ of the 3.4 million American farm operators will be over sixty-five in the next ten years. While they may not want to retire, medical issues, financial concerns and family pressures may get some of these operators out of the driver’s seat in the coming years. The trend seems to be established operations, not new ones purchasing the retiring farmer’s capital assets. The result is even smaller school sizes in some communities as more farms become names on a yield monitor only instead of a household of people who consume and participate in the local economy.
New entrants into farming are rare as the mass transit options, we opened with. Not only is farmland (rent or purchase) rising in costs, but also fertilizer, fuel, seed and chemical are all on the upswing. Yes, weather and war are part of those costs, but the high prices that have offset these issues are not likely to last.
Congress, between grandstanding and gladhanding, is taking a look at barriers to entry and seeing what can be done to get access to capital for the young farmers. It starts with housekeeping at the USDA and perhaps speeding up the “speed of government” to make government backed loans more accessible and easier to obtain, perhaps in advance of actual purchase like commercial banks do. To the local FSA office’s credit, they have worked with bridge loans to allow the elder generation to acquire the ground with traditional financing and then resell to the younger generation when the FSA loans finally get approved.
Conversely, other Congress people are suggesting killing the PLC and ARC programs, removing subsidies for crop insurance and freezing all new enrollments in the CRP. The promise is nebulous tax cuts that will offset these traditional safety net features of farm programs. Those same members of Congress are also trying hard to divorce the farm bill from food programs (school lunch, SNAP, etc). The farm portion of the farm bill has long relied upon food (75% of the spending in the bill- which impacts everybody’s district) to make it pass the sausage making that is legislative action. The Midterms will likely shape the farm bill’s bent, with one party fanatically devoted to slashing government spending and taxes where ever it sees them and the other promoting policy agendas that may not always fit with modern production ag practices.
