Earl Butz was regarded as a well spoken politician who brought out the patriotism in farmers, encouraging them to produce as much as possible – buy more land, take out debt, invest in inputs (like fertilizer and pesticide), and buy bigger and better machines. Farmers listened, and were now reducing their labor costs and using capital (debt) and technology to grow. The approach worked pretty well, for a while…
Then came the 80s. Crop prices plummeted and many farmers – especially those just starting out, were in a tight spot completely over leveraged by debt. Banks pulled their loans and quit lending. Inflation was high, averaging around 7% during this decade (look familiar?), and interest rates skyrocketed to 20%.
Land value tanked.
Devastation struck the farming community. Families lost their farms and rural businesses closed. It was suddenly very clear that farms were the lifeblood of America’s rural small towns. Every four farms that closed led to the closure of one rural business (all those empty, dilapidated buildings in my small town make sense now). There were 500 public farm auctions per month on average. With many farmers racked with the pain of losing their generational family farm, substance and alcohol abuse was on the rise, and suicide in farming populations was 4x higher than normal in the 1980s. The community felt deeply misled by the experts that convinced them that the good conditions of the 1970s would last.
This era is extremely difficult to look back on for any farmer who lived through it, suffering the loss of their livelihood, heritage, and even loved ones. As a beginning farmer myself, my heart goes out to those that lost their farms and livelihood during this decade. Like many bouts of history, today’s farmers and policy makers have the opportunity to learn from this dark decade in agriculture and prevent it from happening again.