Sunday, September 21, 2014

The Real Cost of Inflation

We continue to be told that inflation is minimal, but that is not the case.  Inflation still exists, but it affects things most of us aren't purchasing.  This is the first year in five that good crop and grazing land hasn't gone up significantly.  Most of us aren't buying farmland, but all of us are dependent upon what that land produces, and very much counting on someone to work the land.  The harvest is looking shaky this year, not in the amount, but in the price.  In much of the cropland, the weather has been optimal, but a big harvest may actually bring the price down, while farmers and ranchers have not yet recovered from the years of drought.  Shemitah hasn't even been figured into the equation.

The following is a quote from an article written in 2011, entitled, "High Costs Make it Hard to Grow Young Farmers."
"[Some people are] sitting in New York [and] saying, 'Well, I don't know, I've never even been to Nebraska, but by golly, I'm going to buy some Nebraska land,' " Goss says. "And you have these groups coming together ... that are buying farmland [and] driving up farmland prices to prices we've not seen before."

Goss says even though the Federal Reserve is keeping interest rates low for the next few years, banks simply aren't lending to high-risk first-time farmers.  FULL STORY

Young men with degrees in agriculture can't afford machinery and land.  The equipment required to farm is in the hundreds of thousands and good farmland is selling between $5,000 and $10,000 and acre.   Even at the low figure, a small farm, 160 acres is upward toward a million dollars and that's not enough ground to produce crops to pay for the equipment needed, much less turn a profit.  Most farming households in America have one spouse that works away from the farm.  Some farmers, and there really aren't many farmers left; have inherited their land and rent additional land for crops or pasture, while their spouse works in town.  The numbers look big on paper, but the genuine profit is marginal.

The cost of farmland and machinery, of course affects the cost of groceries, but for some reason the economic reports do not consider these most basic variables into the equation regarding inflation.  To be honest, when I began researching this subject, I expected to find some seriously concrete figures and statistics, but there really aren't any.  Basically, the farmer invests hundreds of thousands of dollars on the hope that he'll make enough to meet his operating expenses and stay in business another year.  Most of the young folks interested in agriculture are already eyeing a deal with Monsanto.  The average age of a farmer working the land is 56 years old, and many of their sons do not intend to follow in their father's footsteps.  Much of American farmland that is operated by independents, is mortgaged or leased.

Farming and ranching is now heading into bigger and bigger operations and we already know, only the big corporations can afford that kind of outlay of investment.  When a farmer can't meet operating expenses, the banks foreclose and that independent operation ultimately becomes just another holding of a conglomerate.   Meanwhile, the food supply becomes more centralized and controlled.   The real cost of inflation is slavery!

Why should we die before your eyes, both we and our land? Buy us and our land for bread, and we and our land will be servants to Pharaoh. Give us seed, that we may live, and not die, and that the land won`t be desolate."  Torah of Holy Scripture 
Post a Comment

Blog Archive