By former USDA Secretary John R. Block
My agenda for this post will be Labor Day and Tough Times. I want to begin by saying how much respect I have for the hard-working men and women that labor in the trenches day in and day out. I’m not talking about big corporation executives, not talking about Wall Street traders, not talking about political big shots or university professors. I want to honor the carpenter, the plumber, the factory worker, the farmer growing the food, the rancher caring for his cattle, the workers in the processing plants – I don’t think they get the appreciation they deserve. Without the everyday workers, where would we be?
Here are some words of a song sung by George Jones that say it all.
“Twelve long months each year my life stays the same,
making my honest dollar in the sun, snow and rain.
No, you don’t see my family on the starvation plan,
for I’m a small time laboring man.”
Thank you and happy Labor Day.
And now, a little bit about the situation today.
Harvest is almost upon us. It’s hard to think about bringing in the crops with the farm economy suffering one of the worst declines in years. It’s not just corn – seems like yesterday it was $7 per bushel and now we are looking at $3 per bushel. In the last year, milk is down. Cheese is down 40%. USDA announced that it will buy $20 million worth of cheese to support that market. Hogs are down, cattle down, soybeans down – fruits and vegetables are hanging in there a little better.
The farmers that I talk to expect 2016 to be one of the toughest years they have experienced in a long time. And, they are not optimistic about 2017.
If you look up the food chain, these depressing farm prices are positive for the consumer. Groceries are a bargain today. We are all enjoying less expensive energy, too. As we begin to price fall fertilizer, we are looking at lower prices. Will seed costs come down also? These are hard times also for implement dealers. Farmers probably won’t be buying very many tractors.
When we pull that combine into the field and begin stripping off those ears, we will have a lot on our mind beyond the harvest.
One thought that comes to my mind is that we have been through these ups and downs many times. We just have to hang in there. Low prices always bring high prices. But, it’s painful.
John Block was Secretary of the U.S. Department of Agriculture from 1981-1985, where he played a key role in the development of the 1985 Farm Bill. If you would like to review his radio shows going back more than 20 years, visit johnblockreports.com.