One Farming Problem
I
IN a local blacksmith-shop a few days ago a farmer and a salesman were arguing. The farmer, alleging that implements made in the United States were sold at lower prices abroad than at home, claimed that such discrimination against the American farmer was unfair. The salesman did not deny the allegation; he replied that farmers had no kick coming even if implements were dumped in the ocean so long as industrial workers were kept employed at high wages. Wages buy food. To which the farmer retorted: ‘Yes — and food ought to buy implements. Maybe if we destroyed part of our crops you city people would benefit because of our increased purchasing power.’
To me one argument was no more vicious than the other. However, to the salesman, although it did not seem wrong to limit production of farm implements, or even to destroy them, if necessary, to keep up prices and wages, there was something wicked about any tiller of the soil who would not extend every effort to produce food, because ‘people must be fed.’
A fundamental error in all proposals to help agriculture is an erroneous attitude toward food. It has a sort of all-important, no-importance-whatever status. The first is a hangover from tradition and the Malthusian theory, the second is the natural result of an abundance of food, of living where anyone who will work need not be hungry.
A young instructor of political economy challenged part of my arguments as presented in an article in the Atlantic for December 1924. He brought up Malthus and assured me that very soon the Malthusian law would be in effect in this country. I asked him what proportion of salary or time his food cost.
I have been wondering about the Malthusian theory for several years. It seems to me faulty in that it overemphasizes land in food-production. Food results directly from land and labor. Either is a limiting factor, and much land plus little labor produces the same amount of food as much labor plus little land. Therefore an increase in population carries with it its own remedy — more labor for food-production. We American farmers are berated because the Belgian hen lays more eggs than the American hen, or because the Danish cow yields more butter fat than the American cow. In those countries, land being the limiting factor, more is produced per hen, per cow, per acre, and consequently less per man. The amount that this 240-acre farm produces per acre is low, but compare the labor on it with that on 240 acres in Denmark and it may appear that I produce as much as half a dozen Danes. In France I have seen twelve men and fifteen women making hay in a five-acre field. The only farms in this country which approach that amount of help are demonstration farms. On the local model farm, four to eight men go after one load of hay. Frequently the cost of the labor exceeds the value of the hay. To ordinary farmers who must manage on a business basis it is obviously uneconomic to use labor whose cost exceeds the value of the work done or the crop handled.
Another error in the Malthusian theory as present conditions obtain is that in the matter of food-production it makes little or no recognition of the value of products from nontillable land.
When Malthus lived tillable land had a load which has since been removed. Even before he died iron and coal had begun to displace horses and grain in transportation. We no longer get our artificial light from the soil via the sheep and cow. The candle remains only in the unit of measure. Twenty years ago automobiles, oil, and gasoline invaded almost completely the farmers’ city market for horses and oats. A mountain or a desert, worthless as a direct food-yielder, furnishes minerals and mineral oils to do the work formerly done by farm products, and so releases sustenance for people. Up to ten or fifteen years ago draft animals, products of the land, required a considerable proportion of food to produce food. Now draft animals are being displaced by tractors, and the grain and forage which tractors do not eat become butter, meat, and bread. In the main, tractors have benefited food-consumers rather than food-producers.
When Malthus lived chickens resulted from eggs incubated under a hen. Grain furnished the heat. And while a hen was sitting, and for a number of weeks thereafter brooding the chicks, she could not be laying eggs. To-day a large proportion of eggs are incubated and the chicks are brooded by the heat of mineral oil or electricity (50,000,000 chicks are hatched annually by commercial hatcheries alone). When a hen becomes a ‘cluck’ she is ‘broken up’ and made to go to work laying eggs. Malthus could not realize that falling water would be transformed into heat and transferred on copper to do a considerable part of a hen’s job. Man cannot make eggs or their equivalent, but he has learned to relieve the hen of a number of weeks of nonlaying work.
Last winter I received a letter from a California fruit-grower who objected very much to the efforts of agricultural extensionists to increase production. He mentioned an annual surplus of 100,000 tons of raisins. These 200,000,000 pounds of fruit not wanted as food are made into denatured alcohol, for which purpose they are worth about one cent a pound. Selling at this price is, of course, a loss to the grower. A food is salvaged to some extent by transforming it into a fuel. Having turned to food-production minerals and fuels, some of which were not known in the time of Malthus, we are now trying to get a balance by turning food into fuel. If a process were discovered whereby milk might be made into gasoline or corn into rubber, farmers would be prosperous.
The Malthusian theory represents the theoretical attitude toward food. Price represents the actual attitude.
This is an old farm. Accurate accounts beginning in 1882 are available. It is these accounts which have destroyed my belief in the Malthusian theory. On the basis of hour effort, food and firewood are much cheaper since 1920 than during the four previous decades.
September 8, 1890, Joe Dobson received ‘for cutting 9 1/2 cords of wood @$.75’—$7.25’ (apparently twelve and one-half cents too much). Wood sold for from $4.00 to $4.75 per cord. Therefore the labor cost in the wood was less than one fifth of its value. Last summer trees totaling over fifty cords blew down, and in order to get the wood worked up I gave fifty per cent of it, which was cheaper than hiring labor outright. Joe Dobson, now a retired farmer, was one of those working on shares. The purchasing power of his hour effort had risen over 150 per cent. Joe, like many another older man, often tells how much the purchasing power of his dollar has decreased, but he does not see that the purchasing power of his hour has increased.
Along in the eighties butter sold for from eighteen to thirty-three cents a pound. The average was around twenty-five cents. Emergency help was hired for one dollar a day. Four pounds of butter paid for a longer day than a man will now work for six, seven, or eight pounds. If I were unfair and compared the highest prices then with the lowest since I have farmed, I should choose an entry of ‘October 16, 1882: 8 hogs, 2050 lbs. @ $7.80 — $159.90,’ and set it against the price I received for hogs of about the same weight fortyone years later — $6.25 per hundred. In 1882 four hogs would pay the taxes and ten the hired man. In 1923 it would take twenty-three for the taxes and thirty-seven for the man. The fact that a farmer pays with his products is frequently ignored. As I look through the old records it is clear that the food-purchasing power of the laborer’s hour has more than doubled.
About two years ago a friend whose business success depends upon a good demand for ferrous metals told me that business was dull —farmers were not buying enough tractors and machinery. I had $1750 in a tractor, $215 in a plough, $445 in two binders, $200 in a milking machine. All told, I had over $4000 in equipment. (Farmers were not buying enough. But how frequently are we lectured on our misuse of machinery with resultant unnecessary overhead!) We discussed. It appeared that his household expenses were $254 per month, and of that only $35 was required for food. It would take him ten years to spend as much for food as I had invested in products made almost entirely from the metals with which his business was concerned.
According to the Chicago Drovers’ Journal, the domestic-science classes of the agricultural college at Manhattan, Kansas, were demonstrating that palatable, wholesome, sustaining meals could be prepared for hard workers for twenty-five cents per day. Such information is absurd, I am sure, but it sets a low food-cost standard for housewives to try for. Many of us fanners object when agricultural schools teach that money ought not to be spent for food.
It is maintained frequently that farmers profit if urban labor is very highly paid. I used to believe this, but I have learned that people do not buy more food with more money. Three years ago a capable young fellow who had worked for me all winter left to work on the road. He said that no farmer could afford to pay what road-construction offered. I agreed, but told him that higher wages for him meant higher prices for me. A little later he had a new car and I realized why food does not advance in proportion to wages. Automobiles are numerous not because they are cheap but because food is cheap.
Every attempt of organized labor to increase wages and decrease hours and output is an attempt to buy food for less effort and decrease the purchasing power of the farmer. Increase of wages increases his cost of production. It is a fallacy that a farmer can overcome high labor-costs by increasing his ownership of equipment. He pays for labor whether he hires it outright or buys it in tractors or milking machines.
For many years organized labor has resisted successfully the law of supply and demand. It has increased its buying power through restriction of effort. One hour of bricklaying, carpentry, hair-cutting, buys several hours of food. While labor has bought more by producing less, the farmer has bought less by producing more. However, a readjustment is near. Just as labor and taxes forced up building-costs and rents, so are they forcing up food-prices. The fact that one can buy food for less hours at almost anything than at its direct production is the fact that is lessening the amount of farm products and will continue to do so until labor in food approaches the value of labor in other services and commodities.
Most of us have a tendency to assume the highest price we ever received for our own services as normal, and at the same time to consider any advance over the lowest prices we ever paid for the services of others as profiteering. With all our talk about coöperation and mutual dependence, we fail to realize that school-teaching or mining is a cost of food as much as food is a cost of school-teaching or mining.
Inasmuch, therefore, as non-farmers have increased their charges in food-production, they must expect to find these charges in the cost of food.