More Moslems Than Methodists in IL?

That's what John Phipps reports.

USDA Birthday: Obama Ignores the Good Stuff

The President issues a proclamation noting the 150th birthday of USDA.  He touches on conservation, food safety, electrification, food stamps, research, market expansion (domestic and foreign), but entirely ignores anything which could be construed as endorsing AAA/ASCS/FSA.  :-( Leaves out crop insurance as well.  :-)

Summary of ARC

From Gary Schnitkey at IL extension, a summary of the Agricultural Risk Coverage program in the Senate Ag's bill:

Summary

ARC will make payments if revenues reach lower levels. In years in which revenue declines, ARC payments will be useful to farmers.

ARC payments will offset some of the losses in gross revenue. The entire loss will not be covered because 1) the .89 factor used to calculate the guarantee effectively puts an 11% deductible on revenue losses, 2) payments are a factor of the shortfall (.80 for the county program and .65 for the farm program), and 3) ARC payments are capped at 10% of benchmark revenue.

If prices are persistently low for several years, ARC payments will decline over time as lower prices enter into the calculation of benchmark revenue. Hence, ARC will provide payments in early years of a multi-year price decline, eventually though farmers will need to fully adjust to price declines as ARC payment decline.

A couple of thoughts:

• there's a cap on the acres (average of plantings 2004-8) which presumably could replace the acreage base, but may involve such things as: the initial establishment and the right to appeal, and the problems of handling prevented planting, CRP acreage, rotations, and changes from one crop to another.  Reminds me of the days of establishing NCA's and acreage bases.
• interesting issue on collecting data--do you collect production data for every participant every year, or only if there's a possibility/probability of qualifying for ARC payment?

The Case for Crop Insurance vs. Ad Hoc Disaster

Via Farm Policy, here's 3 paragraphs from a case for crop insurance, a John Mages op-ed:

Crop insurance is a public-private partnership, designed to ensure that when disaster strikes, the private sector – crop insurance companies – are there to help shoulder the risk and the financial burden of rebuilding.  Crop insurance policies are purchased by the farmer and suited to the farmer’s needs, comfort with risk and financial situation.

In the past, before purchasing crop insurance was the widespread and widely available option, disasters like last year’s would have triggered large, stand-alone disaster bills in Congress, aimed at trying to save as many farms as possible.  Those bills would have cost taxpayers dearly, and unfortunately, would have taken months, or even several years to finally get into the hands of the farmers who need the help.  Not a good situation for either party involved.

In 2011, with 80 percent of eligible lands protected by crop insurance, private sector companies paid out in excess of$10.7 billion in payments to farmers who had purchased plans and suffered losses.  Those checks were often in the hands of the farmers in 30 days or less after they completed the necessary paper work.  It’s because of the effectiveness and efficiency of crop insurance that many of us are in our fields planting today instead of being forced to auction off our farms.

 Since I've been implicitly and explicitly critical of crop insurance, it's only fair to recognize the counter-arguments.  I'm proud of the work my shop did on disaster programs and payments over the years, but it's true enough that an ad hoc program doesn't work as well as having something in place from year to year.

Be Negative to Your Children?

Should you be more negative to your children than anyone else? Should you treat your employees better than your children?  That's what's implied in this table from a post at Barking Up the Wrong Tree reporting research from this book.  The question is: if you want the best relationship, what's the ideal ratio of positive interactions to negative.  For example, parents should praise their children 3 times for each time they reprove them, etc.  If the research is right, I was a lousy boss.  

Of course the point is to be mostly positive to everyone.

Pot, Locavores, and the Farm Bill

Since the beginning, the farm bill has sought to protect farmers from price risk and weather risk, the risk of low prices through overproduction and the risk of low production from.bad weather.  The methods provided in the laws have varied, including cartels, supply management, crop insurance and disaster payments, all of which are conditioned on the basic fact that in a free market, farmers are price takers, mostly at the mercy of those who buy from them.

Because marijuana is illegal, you don't see a lot of discussion about its economics, so I've only vague impressions to go on. (See this PBS piece which looks at costs and volume.)Because pot is illegal, its dealers are insulated from market pressures: once they've established themselves in an area, they tend to have a relatively stable monopoly.  So the tendency is for basically stable networks of growers-dealers-buyers, meaning prices are pretty stable. (Can I find a parallel with contract growers of poultry, pork, etc., which also have stable networks?)  And because pot is illegal, there's a high entry cost for growers. That's what "illegal" means. But it also means that "weather risk" can extend to "law risk"--the chances of a bust.

My impression is that the importation of marijuana is down, and domestic growing is up.  In that sense, the pot industry has been moving in the direction of  locavore. As "grow houses" have proliferated, it's become more localized and more production oriented, more industrial, less organic.

Comes now the legalization of "medical marijuana" (I use quotes because I think it's really a backdoor way to semi-legalize marijuana) which seems to have disrupted the pot economy, according to an article in today's NYTimes Post, for which I can't find the url. (I'll try to add it later.)

On the one hand you have competition among the vendors, both on quality and price.  On the other you have growers having problems. Bottom line is the bottom has dropped out of the price, with big repercussions on the economy of such counties as Humboldt, CA.

One wonders when pot will make it into the farm bill?

Online Service at Social Security

Social Security Administration has added the ability to establish an account and access your personal data online.  Seems to be a good site, permitting very strong passwords (upper/lower case, multiple symbols--I used LastPass capabilities), and some questions which really are personal and can't be determined from online data, at least not until the Facebook generation reaches SS eligibility.)  Even offers the tie-in with one's cellphone, which is becoming popular these days.  One problem, though: apparently it's only available through business hours, not 24/7. ??

Tradeoffs in India

"Open wifi networks are banned in India, because they make life difficult for policemen. This is a bad tradeoff : we have sacrificed the immense gains from ubiquitous open wifi networks, in return for reducing the work of policemen."

from Ajay Shah's blog.

Pigford Deadline Today

The final date for submitting papers for Pigford II is today, applicable only to those who filed late for Pigford I.

Corn Prices and the New Farm Bill

Just a note based on items in Farm Policy--apparently the warm spring has meant early corn planting on large acreages which means prospects for the crop are good, which means prospects for prices are poor (maybe as low as $4--which would have seemed great when I worked).  And the evaluation of the Senate Ag farm bill is that if there are multiple years with lower prices the program payments will decline, an idea the evaluators don't like, preferring instead the guarantee provided by target prices set in the law.