Plowing Under Subsidies

A growing number of farmers believe that an intrusive, expensive farm policy is the last thing they need.


Charles West is six-and-a-half feet tall, and broad. His speech is clipped, his energy level is high, and he walks with a pronounced limp—but fast. Vegetable farming is a quick-paced business, where up to three crops are harvested from a field in a single season, where you have only a few hours to get the job done when it comes time to pick, where tens of thousands of dollars worth of perishable goods can disappear in a blink, due to wilt, hail, or insect hatching. You've got to move to keep up with Charles West.

Luckily I've got him trapped in a pickup. The CB radio crackles with messages between combine cabs, mobile managers, and farm offices. The cellular phone chirps irregularly. As we bang along the field roads, we come upon an evening harvest. Eight migrant laborers and a fleet of machines stuff four mesh-sided tractor trailers with fresh spinach—sloe green and smelling like money. Within an hour the still-bleeding leaves will be swept away to West's 10-minute tunnel freezer. By early the next morning the entire great mound will be locked in crystalline suspension.

The farm lies on the Delmarva peninsula, a dangling tonsil of land rimmed with saltwater—the Chesapeake Bay to the west, the Atlantic Ocean just five miles east. The coastal land is as flat as a calm sea, which is critical for vegetable culture, since field moisture must soak in evenly and mechanical pickers need absolutely level terrain to jostle their quarry out of ground-hugging vegetation.

We circle to a nearby field where three massive, matching eight-wheel-drive tractors drag 10-point plows, shoulder to shoulder. As we watch, this 1,000-horsepower flying wedge turns a hundred acres of sandy earth into a dusty cocoa-colored powder. "Vegetables are terribly hard on the land," West booms above the telecom cackle. To put humus back into the soil and break pest cycles, he alternates vegetables with more-traditional field crops. "After growing spinach—hey—barley or wheat or soybeans are like an antiseptic on a sore. We plant them for that reason, though we don't expect to make money on them."

West and his son, Stanley, farm 8,700 acres, nearly two-thirds of that in multiple crops of peas, lima beans, sweet corn, cucumbers, carrots, and spinach. Their Milford, Delaware, operation is the second-largest vegetable farm in the 23-state northern region, according to American Vegetable Grower magazine.

Vegetable growing is big business—accounting for 15 percent of total U.S. crop receipts these days and growing fast. It is also far and away the most demanding segment of farming. Eighty-five percent of West's land is irrigated by massive spray booms. That investment has proved a godsend in the heat and dryness of recent years, but it is expensive. Vegetable farming costs from $500 to $1,000 per acre, compared to $400 to $500 for the next most intensive crop (rice), and approximately $200 to $300 per acre for wheat or corn. Growing vegetables also makes heavy demands on management skills, and it requires hired labor. Charles West Farms employs 26 full-time workers and 22 seasonal hands.

But there is a lot of money to be made in return for these efforts. West started from nowhere, leaving a furniture store job in 1953 with nothing but a $24,000 loan he somehow talked a local banker into staking on a lima bean visionary. Today, his farm grosses $4.2 million a year; his packing operation brings in another $ 10 million. So where are the local imitators of this one-man farming tornado?

In the main, they're farming something a lot less risky: government row-crop subsidies. Though vegetable growing has greater profit potential than any other type of agriculture, its rigors scare away lots of farmers. As a result, two-thirds of our broccoli and cauliflower are now grown abroad, as well as much of our green beans, peas, strawberries, and other produce crops. West evinces little sympathy for his more-timid brethren.

"It's simple: They're lazy," he barks. "It's easy to grow corn, any half-wit can do it. Most of those guys on the programs only actually farm for 9 to 12 weeks of the year. They don't want to have to think about anything during the winter. They don't want to mess with hiring labor. They'd rather get a boat and go to Florida."

What frustrates West most is the way government programs encourage warped farming. Since he built his freezing plant he has had an opportunity to deal with many of his neighbors from the vantage point of a processor as well as a fellow farmer. "Look," he says, "there are no vegetables in the country right now available to packers. There isn't any sweet corn, no limas, no peas. None to speak of. If I want to make up some mixed vegetable bags at my freezer plant I've got to look for supplies outside the country.

"Right now, I got a load of peas in from Poland—full of snails! Junk. But you can't tell until they come in. If I had my choice I'd never deal with those particular suppliers again. But we will, because we can't get enough American farmers to grow this stuff!"

He continues, "I've also got some frozen Polish green beans a grocery store chain brought me for packaging. They were supposed to be snapped in 1½-inch lengths. Well, they arrived in 4-inch lengths. We can't fit them in the boxes! We have to put up with this kind of quality crap all the time, because American farmers are all too busy growing wheat and corn and other subsidized stuff so much in surplus we don't know where to put it, instead of growing unsubsidized vegetables.

"I used to have 8 or 10 growers in this area who ran their stuff through my freezing plant. This year they all dropped out because they can make more growing crops with government payments. So I had to go out and lease some land and get another harvester to keep up with my customers' demands for frozen vegetables. I'm currently packing 22 million pounds of product in my plant. I've got capacity to pack 28 million pounds. And I could sell 55 million! If I could get it."

Asked for his opinion on the best solution, West is even blunter. "These guys all want to do things like they always have, instead of getting with the times, specializing, taking some risks, hooking up in co-ops. The only thing to do now is starve them out. Put 'em on the street. It's this simple: There should be no subsidies in farming."

One of this nation's deepest and broadest collective attachments is to what one observer has called "agricultural fundamentalism." American romantic devotion to the image of the "family farm" is nearly universal. The power of that attachment is illustrated by the fact that every five years or so, in this country's only extended dalliance with economic central planning, we formulate a top-down national policy influencing even the most minute details of farm existence, then put billions of dollars behind it.

The 1990 version is being cobbled and quibbled over even now. And if the past is any guide, it will be founded in many places on some breathtakingly faulty assumptions about who farmers are and what they need. As we will see in this and subsequent articles, present farm subsidies and controls are inflicting heavy penalties on U.S. agriculture. We've long known the financial costs of farm programs to taxpayers and consumers. They are measured in the tens of billions of dollars annually. More recently, farmers themselves have learned that there is a price tag: in increased costs, distorted production, lost markets, lagging technology, unsound conservation and environmental practices, decreased long-term income, and diminished independence and self-worth.

When the executive director of the Australian National Farmers' Federation visited Capitol Hill in the spring of 1989, he told dozens of members of Congress that he is a farmer and he is against subsidies. "They refused to believe me," Rick Farley told me. "They insisted it was a contradiction to both be a farmer and be against government subsidies. An economist, OK, but not a farmer."

Anyone who actually goes out and talks to American farmers today, however, will quickly discover the members of Congress are badly mistaken. Though their views may not be reflected in the Washington offices of the farm lobbies, a large and growing number of farmers now believe that an intrusive, expensive farm policy is the last thing agricultural America needs.

Most of the public and many politicians don't realize that most of American agriculture already operates free of government entanglement. Only about 30 percent of U.S. farms participate in direct payment programs. The unsubsidized two-thirds of American agriculture includes more than 200 commodities, and not coincidentally this segment is the healthiest, the most profitable for farmers, and the most efficient for consumers.

Nothing fundamental requires one part of agriculture to be protected while the rest is not. Dairy producers say their product is too perishable to be traded on a free market. That may once have been true, but it isn't any longer in an age of refrigeration, reconstitution, and fast roads. Besides, eggs are also perishable, and unprotected by farm programs, yet that hasn't prevented any Americans from having access to fresh eggs.

California and Arizona orange growers claim they couldn't possibly get their crop to buyers in an orderly way and at a reasonable price without government marketing orders, which artificially restrict supply. Yet Florida orange orchardists do just fine without any help, as do livestock and poultry growers, most vegetable and fruit producers, and others in market-based sectors. The competitive successes of America's unsubsidized farmers confound the claim that agriculturalists cannot survive in a free economy.

Moreover, measures enacted for the benefit of one group of farmers often penalize another. Farm policy is a vast, tangled, often internally contradictory web. Iowa Rep. Fred Grandy (R) likes to say that "farm policy subdivides more times than a chromosome." Very often the constituent parts end up pitted one against another.

When the federal government paid for the slaughter of a million cows to support milk prices for the benefit of dairy farmers, beef prices tumbled. Cattle ranchers—independent and free of handouts—suffered for more than a year. When Charles West goes out to lease more land for his operation, he must bid against row-crop farmers whose margins are fattened by a yearly government check. When pumping water out of his wells to slake his cucumber fields, he must compete with counterparts in California who have the benefit of water subsidies. Those same subsidies allow California rice growers to discomfit Gulf Coast farmers, who must flood their own paddies.

One clear example of the differential effects of farm programs concerns feed-grain farmers and animal raisers. About half of U.S. farm income comes from animal production. Poultry, beef cattle, and hogs primarily eat corn, as well as milo, barley, and other program crops. Feed costs account for about two-thirds of the expense of pork production. The figure is even higher for beef, slightly lower for poultry.

Obviously, then, changes in government price supports on corn and other feed grains can make or break unsubsidized livestock farmers. "Whenever low grain prices give poultry farmers a chance to make big profits," Virginia poultry producer R.H. Strickler told the Wall Street Journal, "there's this inclination to do something for the grain farmers." Yet "the government never does anything to reduce the cost of grain to those of us who have to buy it."

Texans are notably open-minded about speed limits, and as you flash south out of Dallas it doesn't take long until you begin to get into some hilly, tree-covered land. Approaching Richland (Pop. 260) the spaces are wide open and the very air vibrates with agricultural rhythms. The ditches and roadsides along Farm to Market Route 3194 are thick with great splashes of Texas wildflowers: buttercups, primroses, fiery spikes of Indian paintbrush, and yellow tumbleweed blooms. And of course bluebonnets, the lupinelike natives that stain entire pastures an unnatural azure and drench the air with a sour, cloying perfume.

As I pull up the gravel road leading to Bobby Wilson's small split-level, the visual music unexpectedly glissades even higher. The house perches on the edge of a great faultline, and down below a valley stretches forever, dotted with tree clumps and watering holes and cattle. Bobby Wilson's cattle.

Wilson is a thin sandy-haired man, quick to make a point, with the cautious and skeptical temperament you might expect from a father of four daughters. He runs 150 cows with some bulls and every year they produce a crop of offspring that he either sells for fattening or grazes himself to yearlings. At any one time he has up to 600 head of stock on hand.

Wilson is a small-scale but respected rancher in the nation's leading ranching state, where 12 million cattle are sold every year. He is active in the Farm Bureau and the Cattlemen's Association and is up on the latest developments in breeding, marketing, and exporting. And he knows exactly what he wants Washington to do for him in the next farm bill: "The best thing the government could do is stay out of the way," he says quietly.

The constantly changing rules, the subsidies for competing products, the elevated costs of inputs, the distorted markets—these are his experience of farm programs. And Wilson worries that thanks to the increasing politicization of American agriculture, the next farm bill will become a target of the burgeoning swarm of Washington-based environmentalists. Then he will be saddled with a heavy load of new controls and regulations, despite never having received a government check in his life.

The feeling of political vulnerability is growing among all farmers. They realize that in an era of long-term fiscal pressure their subsidies—which grew at a faster rate than any other part of government during the early 1980s—are being eyed hungrily by all manner of budget wolves. They know that although farm income is now near an all-time high, it is a highly artificial accomplishment. Seventy-two percent of Iowa's net farm income last year came in the form of government checks. In Illinois it was 94 percent. Nationwide, Uncle Sam provided 36 cents of every dollar of agriculture profit.

"These programs are simply costing too much and not doing us a damn bit of good," worries Illinois farmer Ray Cheline. "Judgment Day is coming."

One of the first things one notices when studying the U.S. farm programs is how very little they have evolved in the more than 50 years since they were born, in the same Depression spasm that gave us the National Youth Administration, the Civilian Conservation Corp, the Works Progress Administration, and other perishables. "Agricultural stabilization" (described by New Dealers as "the greatest single experiment in economic planning under capitalist conditions ever attempted") may be the only portion of the vast New Deal legacy, other than Social Security, that continues to operate in more or less unaltered form.

Having walled off a significant number of farmers from the rest of the economy for a half century, insulating them from both negative pressures and positive innovations, the programs have led many to avoid hard choices and new thinking. "Farmers don't cut back as much as you might expect—as much as they ought to—when prices are bad," one Kansas farmer told me. An Indiana grower reported, "I tend to think in terms of a five-year average before I start considering changing something." Even given the environmental fluctuations that complicate farming, that is a very slow uptake, one that would lead to ruin in nearly any other economic sector.

Some farmers aren't even sure when they are making money and when they aren't. Specialists who consult with farmers on financial matters estimate that only 10 to 25 percent know their true costs of production. As Iowa extension agent Mike Duffy points out, "Corn farmers around here don't really need to know their costs today. Government support levels are set so high even the poorest performers can cover their expenses."

Nor are some farmers inclined to adopt business practices. "Most farmers chose their occupation thinking that it didn't require office work," notes farm consultant Eldon Hans. "They think: This is a job where you can work in the open air and run machinery. They don't want to be students of business management. They don't want to sit at a desk."

Part of the problem is generational. Literally since the nation's founding, as an intrinsic part of industrialization, the number of farmers has been shrinking. As a result, agriculture is always top-heavy with older practitioners. The 1980 census found that 23 percent of the nation's farmers were age 65 or older, and 41 percent were between 45 and 64. Only 36 percent of all farmers were under 45. By contrast, more than 70 percent of all other U.S. workers are under 45.

Older farmers understandably tend to favor traditional ways. Many grew up with the deeply imbedded notion that industrial America aims to exploit rural America and that farmers cannot compete on free terms. They often distrust processors, commodities traders, bankers, consultants, and brokers, and sometimes fear antifarmer conspiracies.

Many are skeptical about market-based solutions to agricultural problems. They tend not to be as export-oriented as their younger fellows. They are usually not attuned to the idea that farmers must increasingly create markets as well as grow crops. They are nervous about attempting new production and conservation techniques. They are not information-oriented. Some of them feel they were led to believe that the government would take care of all these things, and they are frankly bewildered.

Leo Zilik is a hearty, unkempt, friendly man. Though strongly opinionated and possessed of a colorfully filthy vocabulary, he is naturally good humored and verbose. From his Slavic ancestors he inherited a love for the polka and the waltz, and many Saturday evenings find him on the dance floor in one of the rural halls that sustain Texas swing music. Handing me a plastic cup of iced tea across his kitchen table, he begins to wind up.

Zilik (not his real name) grew up in another era and feels betrayed by modern times. A series of ill-advised and careless blunders have kept his farm in trouble for years. Broken down in his yard is an advanced tractor too complicated for him to maintain and too costly for him to have serviced. He borrows a neighbor's equipment much of the time. A hasty decision a few years ago to try growing rice, a high-paying but difficult-to-husband crop, ended in disaster. Stumbling toward the retirement he has craved for years, he keeps hanging on to pay one more set of bills. A few years ago the bile he nurses for a world rushing by him perforated his ulcer, so he now indulges his grudges in short fits only.

Zilik's golden age came during the fatly subsidized 1950s and '60s. Since then, things have become too complicated and too costly, and he doesn't understand why someone doesn't do something about it. Any farmer who works hard, as he clearly does, deserves a good living, Zilik believes. It's only that the goddamn city people and the politicians and the rich are trying to starve the farmers out with a "cheap food" policy.

"The guy that wants to work needs what? A lunch bucket and a car!" screeches his wife from under her rollers. "The farmer—look at what he gotta invest! It ain't fair."

A member of the Texas Farmers' Union, a follower of controversial Agriculture Commissioner Jim Hightower, and a self-described "populist," Zilik prescribes an aggressive, even violent, politics. He believes that all prices are set in offices somewhere and that only by "fighting the sonsabitches" will farmers get a "fair deal." In this he represents the same strain of sentiment that led the American Agricultural Movement, the one-time "tractor-cade" organizers and current enthusiasts for "supply control" as a route to agricultural salvation, to demand in 1978 that Congress simply pass a law decreeing that wheat could not be traded for less than $5.00 a bushel (market prices were about $2.50 at the time).

This idea, after all, is not radically different from the way farm programs already operate, and that is where the sadness comes in. Zilik has obviously suffered genuine humiliation from his farming travails. Mostly, he feels abused and manipulated by the failure of the government to deliver to him the automatic prosperity he feels the farm programs promise.

Once he tried to give up farming and make a go of it as a welder, a trade at which he is quite skilled and from which he no doubt could have supported his family with pride. But he was lured back by the delusions of a guaranteed income and false hopes inspired by a brief uptick—the ephemeral prosperity that periodically surges through rural America, thanks to government policies that presume to suspend the laws of economics and human nature. Eventually discovering he remained susceptible to economic gravity after all, he hardened into a bitter, tragic figure.

Today the chatty dancer has abandoned even life's most sacred loyalties. He openly resents the money he must pay on his ailing wife's health insurance. He vents his reluctance to pass the farm on to his son—who has labored beside him for years—threatening instead to sell it for cash proceeds. He vituperates against his nation, his Texas, his neighbors.

Happily, for every Leo Zilik there are several Loy Snearys. Son of an asphalt contractor in Dallas, Sneary grew up assuming he'd end up in his father's business. He went to college at Texas A&M, majoring in sociology and psychology, and chuckles to think that at one point he thought about going to work in urban planning. But he got himself a wife and her daddy was a rice farmer, one of the pioneers who farmed with mules in the early years after the industry took root south of Houston during the 1920s. The father-in-law offered the newcomer a chance to become a rice grower.

Weighing their options carefully, Sneary and his wife decided to split their furniture and get two apartments—one in Dallas, where Loy coated parking lots during the winter, and one in Bay City near the Gulf Coast, where he flooded fields and grew rice plants all summer. Eventually, he made rice his life.

Sneary is now one of the leading growers in Texas, in many ways the nation's most important agricultural state. In the afternoon of the day we met, he was scheduled to head off to Austin to participate in a Texas Farm Bureau project on the role of government in farming. The group is charged with making recommendations to the state's farmers on what their priorities ought to be in the 1990 farm bill and beyond.

Sneary has a 350-acre rice base, but the plant can be grown economically on a particular field only once every three years, so he rotates his plots over a much larger spread and pastures 500 head of cattle on the fallow land. Rice farming is a tricky, scientific undertaking. To achieve a uniform flood on the paddies, the earth must be precision-leveled using laser-guided land planes. A lot of seeding and chemical application is done aerially, at high cost and considerable danger, and water expenses are high. In this area, the sources are deep wells, 1,100 feet down, which cost more than $100,000 to sink.

As I follow Sneary on his morning rounds, he carefully lubricates, then starts the large new diesel engine he has installed to power his pump more economically than an electric motor. Soon an 8-inch pillar of icy groundwater is pounding out and coursing through the intricate network of routing canals.

A handsome, athletic man with salt-and-pepper hair, Sneary seems to be able to work without rumpling his spotless khaki shirt and crisp jeans. He is a precise person who states repeatedly, "We need to get educated on this…," or "I tried to educate myself on that.…" Water flow rates, fuel costs, chemical usage levels and suchlike are on the tip of his tongue. He is an advanced, forward-looking young producer, one of the impressive number of farmers I met during my 12-state wanderings who could have made successes of themselves in any occupation.

But his is not a typical industry. At the moment, rice is one of the most heavily subsidized of all American crops. Farmers are getting $10.80 per 100 pounds of rice they produce. Of that amount, less than two-thirds comes from their market sales. The rest arrives in the mailbox from Uncle Sam. As market prices fluctuate, the reliance on federal payments varies. But the current situation clearly leaves Sneary uneasy. "To be honest, if I was a construction worker in Dallas instead of a rice farmer, and I paid income tax and saw what farmers got, I would have lots of problems with that," he says.

"There's no way I can say that most farmers haven't lost some self-respect, whether they admit it or not," he sighs. "Don't get me wrong—I'm critical of the programs, but I participate in them. So long as they exist, I've got to." His position is similar to that of the person who continues to claim an objectionable tax deduction while campaigning against it. So long as it is on the books, available to competitors and distorting underlying economic relationships, most business owners have no choice. That is why it is so important to think clearly about the incentives we set up in federal farm programs—because as soon as they are in place, they dictate the required behavior.

"No question, I think government ought to be a lot less involved in agriculture than it is," says Sneary. "When I first started farming more than a dozen years ago, the talk among farmers was positive—yields, new products, growth. Now everything is defensive: What are the new government programs going to do? What will the target price be?

"I'll tell you," he concludes, "the efficiency of American agriculture has been reduced so much in the last 10 years thanks to paper shuffling it isn't funny."

Sneary knows whereof he speaks. He is one of three farmers elected to serve on the citizen review committee of the local Agricultural Stabilization and Conservation Service (ASCS) board. There is an ASCS office in each of the nearly 3,000 agricultural counties in the nation. They are the local government entities that police and implement this nation's farm policy, and they have staggering authority over the nittiest gritty of farm production—what will be planted, where, when, and so forth. Doing a term on the ASCS panel is a kind of obligation of good citizenship for leading local farmers. For several of the growers I spoke with, their service led to a turning point in their thinking.

"In the last three years, the number of hours required of our [ASCS] committee probably tripled," says Sneary. "Between the federal, state, local, and county requirements, it's mind boggling how much interference there is with our production decisions. It's definitely getting worse."

Some of this growing intrusion stems from calculated bureaucratic expansionism. The rest is just an unavoidable complication of the spiraling of a planned economy. Take tractors, explains Sneary. When the Congress pushed crop support prices way above market prices beginning in the early 1980s, some individual farmers got very gaudy payments from the taxpayers. The killer from a public relations standpoint came when a distressed family farmer named the Prince of Lichtenstein got a check for a million bucks to help his East Texas spread scrape by. In the aftermath, Congress established a cap of $50,000 as the most any one farmer can receive in direct payments.

That doesn't sound so bad. But rice, as we've seen, is a capital-intensive crop. There is a lot of cash flow when a rice farmer sells his harvest, but there is also a lot going out every week in expenses. A $50,000 federal payment cap means that the largest operation that is economical is only around a couple hundred acres. Which gets us back to Sneary's tractor story.

"There were lots of guys who were geared up to grow 1,200 acres of rice. They'd sunk the wells, they'd bought a bunch of big tractors and combines, and so on. Suddenly they had five or six times as much equipment as they could effectively use." Why didn't they just drop out of the federal program and farm as much as they wanted without any government payments? Because the federal programs by their very nature depressed market prices to the point where they didn't adequately cover the costs of production. As a result, a lot of family farmers who'd stretched themselves to get modern had to take several steps back down the efficiency ladder. Back toward Sneary's father-in-law and his mules.

Even without perverse farm program incentives, it can be hard for farmers to adapt to the high-tech, fast-moving demands of modern agriculture. For every instinctive progressive like Loy Sneary, there is another farmer who needs a jolt to help him break old ways and try something new. A little less than two years ago, Randy Justiss lost an 18-year-old daughter. "I spent a lot of time just sitting here, thinking about that, and about a lot of other things." His grief and period of withdrawal seem to have led eventually to a fresh willingness to approach old problems in new ways.

That winter he finally sat down and learned to be comfortable with the IBM PC jr. he had bought four years earlier and never used. Today he follows real-time quotes of commodities futures and options prices in Chicago and Kansas City. He can punch up a weather advisory or a crop report at his office terminal. Recently, he and a brother-in-law became partners in a grain elevator. They bought local farmers' output on forward contracts and immediately sold the promised goods back to brokers in the commodities centers.

With his son and one Mexican-American helper, Justiss farms 2,700 acres of wheat and milo. He is one of only about a dozen farmers left in fast-growing Dallas County, but he has found a way to prosper in spite of the high land prices development has brought on. Except for the site of the barn where he stores his three tractors, two combines, and other vehicles and rigs, all of his land is now leased. He is gradually going to lose access to his fields, he knows, as subdivisions and industrial parks creep outward from Big D. Meanwhile, though, he is able to do quite well—because speculators keep rents low so they can take advantage of agricultural-use property tax reductions.

Market prices for wheat are rising toward the high government-guarantee levels—thanks to tight supplies brought on by last season's drought—and Justiss has dropped out of the federal wheat program. He is planning to lease as much land as he can lay his hands on next year and put it all in wheat. He is also considering buying put options in the futures market to hedge much of the crop. In short, Randy Justiss is bursting out all over. He is running his farm like the capital-intensive, speculative, highly modern business it is.

A barrel-chested, deep-voiced man in a plaid shirt and a cap, Justiss is a model of the new American farmer—hardworking and rugged as ever, but also fastidious and attentive to mental detail. As I sit watching in his tidy office he tickles a price quote for July wheat out of his computer. "It's easy when you're a farmer to just keep on doing things the way you've been doing them," he admits. But habitual ways are beginning to change all across agricultural America, in some places fast.

Ignorance is no longer an excuse. American agriculture has always had a superb technical dissemination wing for new production techniques. For years, land-grant colleges, the USDA's Agricultural Research Service and field agents, and various private groups have empowered common farmers with the latest research in an astonishingly successful way. When it came to the financial and business end of farming, however, the resources were thinner.

But farming is now jumping into the entrepreneurial age. Justiss is hooked up to an on-line service offered since 1981 by the American Farm Bureau Federation to any of its 3.7 million member families. For $20 to $40 a month, any farmer can have toll-free access to all the national financial exchanges, a national news wire from Washington, D.C., a local and state news service, a 5-day, 10-day, and long-term weather forecast, a database of government reports with all current releases, a Farm Bureau advisory service, and more. With a satellite dish the farmer can get it all even more cheaply. The Farm Bureau will also sell any farmer a computer, at a reduced rate, and supply three days of training right at the farm.

State extension services continue to be tremendous grassroots resources in rural America. Fourteen states also have chapters of the Farm Business Association, a nonprofit private group that offers a wide range of specialized consulting for a nominal fee (about $500). Among other services, its consultants will visit a farm to advise on tax planning, diagnose animal diseases, suggest crop rotations, or aid with bookkeeping and sales decisions. The bottom line: Probably no other small business sector in the American economy has as much competent and low-cost technical advice available to it as family farming.

And farmers are picking up on it. They are computerizing. They are beginning to form marketing clubs with pooled money and information as a way of initiating themselves into private commodities trading. They are setting up accounts with brokers. They are diversifying into new ventures. They are adopting new technologies. They are self-insuring against weather hazards and price downturns. "As people get started," says Justiss, "word of mouth spreads. And when folks get so they understand it and realize what's now possible, I guarantee they will be interested."

After years of relying on others to guard their economic security, farmers are taking measures to increase their competence and flexibility, to protect the birthright of their farm equity, to increase their economic independence and cut their reliance upon the federal sugar teat. A privatized structure of agricultural income support is at last beginning to rise.

Contributing Editor Karl Zinsmeister is a Washington, D. C.-based writer and an adjunct research associate at the American Enterprise Institute. This article is the first in a four-part series. Next: Why billion-dollar government programs hurt farmers.