Wall Street Journal Paints a Narrative, Misses the Real Story.
By Jim Mundorf
I've heard it for years, the big bad corporations are coming in and stealing Ma and Pa's farm. The Wall Street Journal has done some research and come to find out what most in the Ag community have known all along. Corporate farms are owned by Ma and Pa.
14 years ago when I was a senior in college we were forced to take a class called Capstone before we could graduate. It was supposed to teach us about the ways of the world, but what it really was, was a way for the college to milk payments for another 3 credits out of unsuspecting students. Anyway, we got to talking about farming and as per usual somebody pipes up who has no idea what he's talking about and says that big corporations are taking over and in 10 years there won't be any family farms left(14 years ago.) Well, as I looked up from my big long chuckle, I looked around and realized no one else was laughing. This was at the University of Northern Iowa in Cedar Falls Iowa, a small town smack-dab in the middle of the grain belt and everyone in there just accepted the fact that family farms were being taken over by large corporations.
That was the story. Corporations are taking over family farms. The truth is farms are businesses, and just like any small business, if you don't incorporate you end up losing buckets of money to the tax man. Nobody wants to do that, so they incorporate and the Farmer becomes the president and CEO of his corporation/farm. Which leads to the idea that farms are becoming corporations, which they are but they are run by the family.
This brings us to yesterdays ground breaking revelation, from Jacob Bunge of the Wall Street Journal.
U.S. growers are swallowing up acreage to survive a harsh agricultural downturn, squeezing smaller operations and transforming America’s rural economy
Wow, what a headline, and like most headlines designed to entice you to click on it, its BS. "Gobbling," "swallowing" and "squeezing," these are the terms they have decided to use, to give you images of the big bad farmer in the form of Pac Man gobbling up his neighbors and swallowing them whole.
For a perfect example they have found the unique case of Lon Frahm from Colby, Kansas who owns what they call, "one of the countries vastest" farms at 30,600 acres. Lon seems to be a, driven, smart, successful guy. He, "helps fund Colby’s hospital and community college. But he has stepped in at the last moment to place the winning bid at land auctions."
Wait a second I thought he was, "gobbling" and, "swallowing," this land but it turns out he bought some on an auction. "But he has stepped in at the last moment to place the winning bid at land auctions." That is the kind of sentence you write to point a story in a direction. I mean what kind of sneaky bastard places the last bid at an auction?
Then in 2013 his uncle retired and Lon, "gobbled," up the 7,000 acres he was farming. Turns out 12,600 acres of Lon's farm was inherited or purchased from family. That's close to half, and it mentions that he rents some but doesn't say how much, which leaves us guessing at how many of the the remaining acres he has swallowed up from his unsuspecting neighbors.
Its an interesting read and the story they are telling is accurate for the most part. Big farms are getting bigger, they have been for my entire lifetime. The article isn't overly critical of Mr. Frahm, its just that the headline, and a few sentences here and there, seem to put a negative spin on what looks to be a very successful and ambitious guy who does things the right way. It profiles a couple other farmers and uses their stories to write the article that they are trying to write. They also use some statistics and fancy graphs to show the increase in the average farm revenue, but don't mention much about how grain prices and increased yields affect those numbers.
If you want to write a story on how farming and rural America is changing, go ahead and write it, but why put the blame on people who are successful. I wonder how many stories the Jounal has done with a headline like this on Walmart. A company that literally is, "squeezing," out their competition. Lon Frahm is not moving in across the road from the little guy undercutting his prices and hoping the little guy goes broke. That's not how farming works. But speaking of Walmart, if they wanted to write about people gobbling up land why not write about Stan Kroenke or Ted Turner. Ted Turner owns 66 times more land than Lon, 2 million acres. Kroenke (who married into the Walmart family) owns close to a million acres, and from what I've heard the neighbors of both of them are scared shitless about what they plan to do with it.
Farms are getting bigger. They have been for a long time. There doesn't always have to be a good guy and a bad guy. I'm as nostalgic as anybody. I miss how things were when I was a kid, but I'm glad I get to raise my kids here, and when they are old they will miss how things were too.
Its an old story. Farmers retire, they die, and if they don't have anyone to hand it over to, the farm gets sold. Usually another farmer buys their land. Often times these farmers that are buying land have kids that are eager to take over and continue expanding the farm. That's what's been happening in Lon Frahm's family since the 1880s.
But then the most interesting little nugget of info comes in the last paragraph. Turns out Lon doesn't have any kids, "Mr. Frahm said he has no heirs, and after he dies he plans to have a foundation own his property, with the goal of maintaining jobs for his employees and funding his community charities." Imagine that, a foundation running a farm. That's something you don't hear everyday. They will probably have a board of directors to make all of the decisions. Sounds pretty corporate to me.