Listen: Mainstreet farm crisis

Midday presents a Mainstreet Radio special broadcast from Starbuck, Minnesota. Host Mark Steil looks back at the farm crisis of the 1980s. Program includes a chronology of the crisis, commentary from an economist, and various interviews of farmers and officials on the experience.

Program includes audience/listener questions and commentary.


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SPEAKER: Minnesota Public Radio's Mainstreet Radio is supported by a major grant from the Blandin Foundation, strengthening rural Minnesota's communities through grant making, leadership training, and conferences.

MARK STEIL: Good afternoon. This is Mark Steil. And we have a kitchen full of folks here at the Gloria and Jim Langman Farm in Western Minnesota. The coffee's on and there's a bowl of blueberry muffins here with us on the table. It's nice and warm inside. Outside, there's a howler of a Northwest wind. And wind chills are below zero this afternoon. This is a kitchen with a history.

During the farm crisis, politicians, lenders, farmers, and others sat in the chairs we're sitting in talking about their future and agriculture's future. Farmers on the verge of losing their land have cried at this table. Jesse Jackson sat here. Hollywood stopped by when filmmaker Lee Grant visited while making a documentary. All of that during the farm crisis. . No one's sure how the years between 1983 and '87 got that name, but it stuck.

It describes a time when farmers like those surrounding us here in these newly harvested fields in Pope County spent sleepless nights and tense days wondering if their lives on the land could continue. The farm crisis changed life forever on the Mattison Farm in Southwest Minnesota. Larry and Marlys Mattison filed for bankruptcy more than 10 years ago, but fought back and held on to the farm they call home.

Today, a small cow herd grazes pastureland flanking the Kanaranzi Creek. With the help of a son, Larry also runs a hog operation. The Mattisons' eyes sometimes mist over as they talk about their lives. Larry's Snow White beard frames a weathered 57-year-old face. Gesturing with her hands, Marlys Mattison says this is still a family farm, even though Larry works full time as a truck driver and a son-in-law rents the cropland.

MARLYS MATTISON: I'm here alone most of the day. I babysit, but I don't have a lot of adults to talk to. And it used to be busy all the time. I mean, machinery and trucks and cars. And it's kind of lonely. I enjoyed it when our son-in-law was taking out the corn because the tractors were running and the elevators. And it kind of reminded you of the old days when we were involved with it.

MARK STEIL: The old days include the good times of the '70s and the bad days of the '80s. The Mattisons were one of thousands of families caught in an economic bind so tight no farmer escaped the squeeze. Marla and Larry remember the pain.

MARLYS MATTISON: Oh, it was terrible. The worry was unbelievable. Unbelievable. Larry and I would go to bed at night and we would not sleep a wink. We would just-- you couldn't sleep because you didn't know where your next meal was coming from.

LARRY MATTISON: I think the depression finally gets you. When they took the livestock, they took my livelihood. They took my job. They took everything. What do you do? You couldn't buy a job. So there's really nothing to do. So it just gives you some more time to sit and think.

SPEAKER: $35,000. I want $37,500 now, guys. $37,500. Now $37,500.

MARK STEIL: During the farm crisis, one farmer's life was transformed into another's bargain. Sometimes, demonstrators tried to block auctions.

DEMONSTRATORS: No sale! No sale! No sale! No sale! No sale!

MARK STEIL: Some farmers gave up voluntarily and sold out. Others waited for the foreclosure notice or filed bankruptcy. The loss of farms hurt other parts of rural life. Stores closed, school enrollments fell, and property values declined. Western Minnesota farmer, Paul Gillespie, was worth a million dollars at one time. But the farm crisis took most of it away.

PAUL GILLESPIE: You never had a whole lot all your life until in the '70s. And then things went wild. You'd think, by gosh, you will never make enough bad deals that you will go broke. But it don't work that way. You might think you're going to make it forever, but you don't.

MARK STEIL: Forever lasted about seven years. It started in 1973 with one of the most spectacular explosions of farm prosperity ever. Richard Nixon was president and the Soviet Union was short of grain. Sales to Russia and other nations cut into US grain supplies, boosting demand and raising crop prices to record levels.

Farm income nearly doubled between 1971 and '73. The early '70s were boom time and no one predicted a bust. Iowa State University economist Neil Harl says it left farmers with substantial material gains, but eroded their normal conservative spending philosophy.

NEIL HARL: The price of soybeans went from about $3.45 a bushel to about $9. Corn went from $1.20 a bushel to $3 or more. And that had a profound effect upon many people. And they thought, aha, the bad old days are all behind us.

MARK STEIL: Spurred on by record profits, farmers borrowed heavily to increase production. Government officials at all levels urged them on. Nixon Agriculture Secretary Earl Butz led the charge, telling farmers to feed the world by planting fencerow to fencerow.

EARL BUTZ: We've had 180 degree turn in philosophy in our farm programs in the last year or two. That after 40 years of a philosophy of cutback and curtailment, we've now turned around to a philosophy of full production of turning our farmers loose, of producing for a growing market, of using this tremendous production resource we have in the United States and using it effectively.

MARK STEIL: Larry Mattison smiles when he recalls the boom times of the '70s.

LARRY MATTISON: Oh, god. That's a great big high. You always looked ahead to how much better it was going to be next year. And you always got that optimism. You was riding on the boom.

MARK STEIL: High grain prices didn't last, but the expansion mentality did. Farmers were on a shopping spree. Economist Neil Harl.

NEIL HARL: There was a waiting list long enough, so it took about a year to get a new tractor at that point. People were using their additional income to buy equipment. We had a boom in combine sales. We had a boom in tractor sales. And of course, they were also bidding up land.

MARK STEIL: Land prices doubled, then doubled again. In Southern Minnesota's Martin County, one field brought $4,000 an acre. Farmers paid for the boom with borrowed money. Western Minnesota farmer Carmen Fernholz says they tried to use the beneficial side of inflation.

CARMEN FERNHOLZ: Inflation is always good for the farmer. In fact, it's good for everybody if you know how to use it. And I think a lot of us in the "70s and '80s didn't use it properly. I think we let it get away from us. Instead of being concerned about our debt load, we felt that the only way we're going to stay in this is expand, expand, expand.

MARK STEIL: The record grain prices posted earlier in the decade had disappeared, never to return. Many farmers were losing money on their crops, but covered losses with gains produced by inflation. Fernholz says they used inflated land and machinery values as collateral on loans.

CARMEN FERNHOLZ: For example, if I would buy land at $500 an acre, the next year, let's say land prices would be up at $600 or $700. I had paper equity in that land. So I could go in and say, look, I've got more equity here. I can borrow more.

(SINGING) NFO has found the secret to help all the farmers. Help all the farmers. Help all the farmers.

MARK STEIL: By the late '70s, groups like the National Farmers Organization sounded the alarm, saying agriculture was not as prosperous as many believed. It cost more to raise some crops than they could be sold for. Farmers upset with their declining financial condition formed a new organization, the American Agriculture Movement. It gained widespread attention with several protest tractorcades to the nation's Capitol. As the 1980s began, a series of events signaled the end of the farm boom.

JIMMY CARTER: The 17 million tons of grain ordered by the Soviet Union, in excess of that amount which we are committed to sell, will not be delivered.

MARK STEIL: With that announcement in early 1980, President Jimmy Carter halted grain sales to the Soviet Union to protest their invasion of Afghanistan. The embargo's most important impact was psychological. Farmers saw it as a signal that Washington didn't care about their future. At the same time, the Federal Reserve Board began an all-out war on inflation. Economist Neil Harl says farmers were among the first affected.

NEIL HARL: We can live with about anything. But what is painful is seeing a change occur. You can live with inflation or you can live without inflation. But what is most difficult is living in a world in which you're going from one to the other. And that's what really stresses the system. And it did in the 1970s and '80s.

MARK STEIL: The Federal Reserve Board choked inflation by restricting the money supply. In just three years, the rate of inflation dropped from 14% to 4%. But the action also caused interest rates on loans to soar. Farmers rely on borrowed money to pay spring planting and other costs. But many could not pay interest rates, which topped 20% in the early '80s.

SPEAKER: I have been farming since 1946 when I got out of the service. And the place that's being foreclosed, we purchased in 1948. And we were progressing real well up to about 1979 or '80 when the economy went to pot. The interest went up. And the price of commodities went down. And we could no longer make our interest.

MARK STEIL: March 1983, a farmer speaks from the steps of the Lincoln County courthouse in Ivanhoe in Southwest Minnesota. Hundreds of people there staged one of the first public demonstrations about the economic noose tightening s thousands of farmers.

SPEAKER: As you're aware, there is a forced sale here. There's a farmer whose livelihood is being destroyed. This is a demonstration by people who care against those people in the government, against those lenders that don't care.

SPEAKER: People are showing up now. And I'm going to do a song. We did it before. And I'm trying to do one that everybody can join in. We shall not be moved today.

(SINGING) We shall not, we shall not be moved!

We shall not, we shall not be moved

Just like a tree that's standing by the waters

We shall not be moved

MARK STEIL: Many farmers focus their anger about failing economic conditions on easy targets like lenders and the government. But something more complex was underway. In farm areas, inflation had not only ended but had been replaced with deflation. Prices were actually going down. The most dramatic example was land. Farmers unable to meet high interest payments began selling land to meet their bills. Buyers quickly realized these were forced sales and farmers would take bargain prices. Western Minnesota farmer, Carmen Fernholz.

CARMEN FERNHOLZ: There was no longer the pressure to keep the land up. And so it started tumbling. Locally, for example, I think we peaked at $1,600 to $1,800 an acre. And I think it was two years later, land was down at $600 and $700 an acre. So it happened quite quickly.

MARK STEIL: It was as if the value of a $10,000 Chevy parked in a farmer's garage was cut in half overnight. Maybe the farmer still owed $7,000 on the car. Suddenly, more was owed on the car than it was worth. And both lender and borrower faced a loss. Economist Neil Harl says that's what happen as land prices went into a free fall.

NEIL HARL: In one year, we lost over 30% of land value, the year 1985. And so it just strikes terror in the hearts of a lender. You cannot believe today how frightened people were in 1984, '85, and '86 when we were seeing value cut out of balance sheets at the rate it was in the 1980s. Just incredible.

MARK STEIL: The drop in land values dragged down the value of other farm assets like machinery and buildings. Thousands of Minnesota farmers were trapped.

SPEAKER: This was not a public auction! The Sheriff was not present for the entire sale to take bids. He has conducted an illegal auction! And he is supposed to be an officer of the law!

MARK STEIL: Farm protests became more vocal and widespread. In some areas, the future of one farm became a rallying point. Three times a foreclosure sale was scheduled for the Langman Farm in Western Minnesota. Three times demonstrators forced a postponement. While the protesters kept the land from being sold publicly, Jim Langman discouraged private attempts to buy it.

JIM LANGMAN: The neighbor called up one day and he said, Jim, your farm's advertised in the newspaper, foreclosure. And so he said to me, well, we're interested in buying it. And I said, well, you can go ahead and buy it if you want to. But there won't anything grow on it. He said, why not? I said, because I'll burn everything off of there that grows on there. And I said, if I don't burn it off-- I said, I'll have to put so much atrazine on there that nothing will ever grow there. And I meant it.

SPEAKER: $200. $225. We get $225.

MARK STEIL: Farm protesters look to the past for strategies, like the penny sales of the Great Depression, when farmers bid a few cents so machinery could be cheaply returned to the owner.

SPEAKER: The bank hasn't got a farm with the people [INAUDIBLE] needs it. It's not too much to ask. It's ain't a great big new tractor. Let this man work his land. He still owns land.

SPEAKER: $200. $225. $200. $225. $150, $75. $75. We get $200, $175.

MARLYS MATTISON: Larry and I admitted right away to our friends and family that we were in financial trouble.

MARK STEIL: Southwest Minnesota farmer, Marlys Mattison.

MARLYS MATTISON: Our friends were in the same financial trouble, but did not admit it. So we did feel really alone. It would have really helped if some of our friends would have said, hey, look, we don't have any money either. But the pretense was there that they were doing well and we weren't. And so Larry and I both felt like failures.

MARK STEIL: The social stigma of financial ruin weighed heavy on stoic farmers. Some bore the weight alone, others reached out. This ex-farmer turned a public meeting into a display of private grief.

SPEAKER: I started farming at the age of 14. I saw a father have a nervous breakdown through the '30s. I have prayed to my God all my life that what would happen to him would never happen to me. Namely, he never lost his farm, but he lost himself and never came back.

MARK STEIL: As more farmers went out of business, calls for help increased. In Southwest Minnesota, one group held a series of meetings in late 1984. When organizers expected dozens of people, hundreds would show up. The public outpouring of support attracted widespread media attention and gave the new group its name.

SPEAKER: The rally is going to start. We're going to call it the Ground-- what are we going to call it? Ground-- yeah, Groundswell.

SPEAKER: Groundswell Do or Die.

SPEAKER: Yeah. Yeah. We're going to call it the Groundswell Do or Die.



SPEAKER: Let's go.

SPEAKER: Preparations continue for what could turn out to be a huge protest at the Minnesota State Capitol. Next Monday, a group called Groundswell has scheduled a rally at the Capitol to protest the severe economic problems facing many Minnesota farmers.

BOBBI POLZINE: Groundswell was a marvelous thing.

MARK STEIL: Bobbi Polzine helped organize Groundswell. She says financially desperate farmers reached rock bottom. But instead of giving up, they fought back.

BOBBI POLZINE: They finally had a voice. It was their own voice, not mine. These people, they poured out. They dug in their heels. They pounded their fists on desks. That means that they went to the banker and said, enough. They were no longer ashamed to show up and use their voice and to be shown on camera as saying, hey, look, we're going down.

DEMONSTRATORS: No sale! No sale! No sale! No sale! No sale!

SPEAKER: If we don't stand up for what's right right now, we're going to lose our ass. You laugh about that. It's a proven fact. If you stand alone, you're going to fall.

DEMONSTRATORS: No sale! No sale! No sale!

SPEAKER: Who's going to own this land unless we stand up and fight? Who's going to own it? And my great grandfathers, they left Sweden because they were peons over there. And unless we fight back, that's just exactly what we're going to be here as peons.

SPEAKER: I think there is great hope in the midst of this unbelievable heartache and despair that's going on. I would give up my life if it meant that our farmers could receive a fair price for what they produce and it would help ensure our family farm system for eternity. But I'll tell you this, we will win. We will win! We will win! We will win! Thank you very much. Thank you!

MARK STEIL: Groundswell and other farm groups lobbied state and federal government. The initial reception in Washington was chilly. President Reagan's budget director, David Stockman, blamed farmers for their problems.

DAVID STOCKMAN: For the life of me, I cannot figure out why the taxpayers of this country have the responsibility to go in and refinance bad debt that was willingly incurred by consenting adults who went out and bought farmland when the price was going up and thought they could get rich.

MARK STEIL: Eventually, the president did increase government aid. Direct federal payments to farmers doubled in three years, helping keep thousands on the land. By 1987, federal aid accounted for more than 40% of total farm income. Minnesota lawmakers also helped. This state representative from Western Minnesota said his home district was suffering.

SPEAKER: We've had five suicides in Swift County in the last 18 weeks. And three of them have been farmers. And I've sent letters of sympathy to those people. And I've told them I'm doing the best that I can. Last November, they elected us because we asked them to select us to lead them. Let's do that, shall we?

MARK STEIL: The state approved funds to reduce farmers' interest payments on loans. And they set up mediation sessions between farmers and lenders. But the challenge laid down by Reagan budget director Stockman reverberated through agriculture. Who's to blame for the farm crisis? Retired banker Eugene Ornberg worked in hard-hit Southwest Minnesota during the agricultural bust.

EUGENE ORNBERG: Oh, I'm sure that there's blame on both sides. Farmers were eager to borrow and bankers were eager to loan.

MARK STEIL: Lenders went through their own nightmares during the farm crisis. Two bankers in Southwest Minnesota and one in Iowa were murdered in farm-related incidents. Others were threatened. Ornberg says many farmers did not understand that government regulators were pressuring bankers just as intensely as bankers were pressuring farmers.

EUGENE ORNBERG: They will go over these loans and give you a schedule and say, well, we're going to be back in six months. And we want some improvement on these loans. You had a time schedule to follow. And if the loan was the same six months later, the regulatory people actually had the authority to remove you from your job.

MARK STEIL: Still, many farmers have one enduring memory of the farm crisis that if they decided against buying land or machinery, they could have muddled through with half the pain. Larry Mattison remembers 80 acres a lender urged him to buy.

LARRY MATTISON: He said, there's just one thing about it, Larry. He said, there is no more land. And he said, that $2,000-an-acre land in 10 years is going to be worth $6,000. So if you never make a nickel farming it, he said it's going to be a good investment.


Oh, boy

MARK STEIL: Farmers who survived the crisis are very careful now how they spend their money. They're especially watchful of debt. Economist Neil Harl says that's an excellent bulwark against a repeat of the '80s. But it's no guarantee.

NEIL HARL: When people's memories begin to fade and you've changed the cast of characters and they don't really believe anymore that there was a serious problem, that's when you have difficulty.


MARK STEIL: Good afternoon. This is Mark Steil. And you're listening to a special Mainstreet Radio broadcast. Our topic, the farm crisis of the 1980s. The coffee's on at the Jim and Gloria Langman Farm near Starbuck in Western Minnesota. With us this afternoon at our table is Jack Morris, Pope County extension director. Jack, as I listen to that, it struck me that there's a real issue, I guess, with a lot of people. Did the farm crisis ever really end?

JACK MORRIS: Well actually, it's still going on. We're still in a situation right now where we have, in this area of the state particularly, situation where farmers have had a hard time getting their crop out this fall, even though we've got a good crop. We've been struggling through harvest.

And I'm sure there's pressure at making loan payments at the very moment, primarily because of the difficult time we've had this fall in getting our crop out. So yes, I think that we're still struggling, but the situation is a bit different now than in the '80s. But--


JACK MORRIS: Still challenging.

MARK STEIL: What are some of the major differences?

JACK MORRIS: Well, I think right now, we have a decent crop out there as I've indicated. It's just a matter of getting it in. I think that we have a situation now where interest rates are lower than they were in the '80s. Surely, there were interest rates in the '80s that are in 10%, 12%, 13%, 14%, 15% area. And of course, they're a little lower today. I think that we've learned some things from the '80s, particularly farmers and lenders/creditors.

I think we've learned a few lessons that maybe we need to make some of these things work on paper before we go out and pay more than we can afford to pay for land and other inputs. And also, I think there's a better communication now between farmers and lenders. Certainly, one of the things that was going on in the '80s was there was a breakdown of communications, often between creditors and lenders.

And that's understandable because worst thing that I can imagine is being unable to pay somebody who you've borrowed money from. And certainly, the stress of that made communications rather difficult. I think that that's been improved.

MARK STEIL: Jim Langman, you managed to stay on your farm after a considerable struggle. The land is yours, but you rent it out. What's it like driving through these golden fields of corn down the long driveway to your farmhouse between fields that you didn't plant and you won't be harvesting?

JIM LANGMAN: Well, the corn is still standing out here along the driveway this year. So it's probably a pretty good feeling to drive by it. And thank goodness, somebody else has to harvest it and I don't have to do it. And when I see the combine stuck in the mud right around here, it feels all right. I sometimes get a little bit of urge to drive that combine. But when I see one stuck in the mud, I feel pretty good about driving by it.

MARK STEIL: Now your story was closely followed in the middle '80s. Give us a short summary of how that all came out. There were the demonstrations at the planned foreclosure sales. The thing never was sold at foreclosure. Take it from there. How did you manage to come back and own the land?

JIM LANGMAN: Well, at that time, of course, the protests were the beginning of the mediation process. Because at that time, there was no mediation. So it was a forced mediation through-- the people pulled together to force that to happen. And so at that time, we thought that it probably wouldn't help us through the legislative process and so forth. As a year or so went by, it really did end up helping us because we had the first right of refusal to buy the land back.

And then first of all, we had the first right of refusal to rent it back. So we continued to stay linked to the land that way. And then in the end, I did end up buying the land back and sold two parcels off. And we were able to keep 120 acres.

MARK STEIL: Do you believe that activism in the '80s, Groundswell and the other groups, did a lot of good for farmers?

JIM LANGMAN: Oh, yeah. I think so. Yeah, you bet. I mean, the mediation process probably wouldn't even taken place without that. That process of protest is a right that we have in this country. That's how this country was founded from the oppression in Europe. And so it's in our roots. It's back there. And I think that we had to go through that process to reach the point of mediation. Somebody had to take a stand. And I just happened to be one of those.

MARK STEIL: Jack Morris, Pope County extension agent. The mediation process that evolved seemed to do a lot of good out here. Tell us what happened.

JACK MORRIS: Well, I think it did. As Jim indicated, it was the result of some pressure that was brought to bear down at the legislature in 1986. In March, the mediation program was part of the omnibus Farm Bill that came out of there. And the extension offices in each county had the responsibility of coordinating and managing the farmer-lender mediation program here in Minnesota.

And I think that it had a lot of doubters when it started, farmers themselves and lenders. But as we got into it, we found that the process gave us an opportunity to get things started in situations that had kind of broken down. And the process really was a chance to get all of the lenders or the creditors around the table and see if we could work out a solution to the problem that we were dealing with. And so I think the best part of it probably was the fact that it opened up communications between lenders and farmers.

MARK STEIL: And the farmer would actually get together with you. And you would sit down and talk about how--

JACK MORRIS: Definitely. See, the way it starts is that a foreclosure notice goes out from an initiating creditor. And a copy of that goes to the county extension office. And then our responsibility was if this particular farmer wanted to request mediation, then he would come in and request the mediation. We'd go ahead and set up the mediation process. We'd name a mediator. We'd do a financial analysis of the farm and get them ready for mediation.

JIM LANGMAN: How many did we have, Jack?

JACK MORRIS: Well, Jim, we were one of the big guns in the state in 1989. I just looked back this morning and we had about 180 mediation requests at that time. We were fourth highest in the state.

MARK STEIL: In this county?

JACK MORRIS: Yes, in Pope County. And the thing that you have to realize too is that every farmer that got a foreclosure notice didn't request a mediation. These were just the requests. And looking at it from over the history, I've determined that about half of those that got mediation are foreclosure notices that actually requested mediation.

MARK STEIL: So you're still dealing with mediation.


MARK STEIL: How many cases do you have now?

JACK MORRIS: Well, yeah, this happened at Pope County, once again is one of the leading counties. Pope County and Roseville County just happened to be the two counties in the state that are picking up a lot of mediation requests. At the moment, we've gotten 14 requests since August, and that's rather troubling. But I think it reflects the difficult fall--

MARK STEIL: Oh, the weather.

JACK MORRIS: --we've had out here this weather. I hope it's related to weather. In fact, I'm happy that within during the last two weeks I haven't gotten any, Jim. But they were coming real fast a couple of weeks ago.

MARK STEIL: And we're at the Jim Langman farm again in Western Minnesota on a cold, windy day, but it's nice and warm here inside. Jim, looking across the fields and the woods beyond, this area has changed quite a bit in the '80s you told me. What sorts of things happened? How many people moved out? How many are still here?

JIM LANGMAN: Well, obviously, 190 went through mediation but we-- I don't know just how many of those stayed. I know that, within six miles of my farm here, people that I-- You're only in contact with so many. I know that we counted 32 young family farmers that moved away to as far as Arizona, Montana, different places and took different jobs. And that's kind of hard to see happen. I mean it was a tough emotional thing to see other farmers losing their farms here.

I mean this is a community and some didn't want to face reality that was happening. They just kind of just-- it was like not there, but others faced the reality like myself and said we got to do something about this. You can't just let this continue. And it still continues which whether it's weather related or whether agriculture, just can't seem to get its act all together. I don't know just exactly what it is.

JACK MORRIS: I'd like to add one thing, Mark. I think there's a common misconception among non-farm people and some farm people also, that mandatory mediation essentially meant mandatory writedowns of loans. And, really, it was a process, Mark, and it meant mandatory mediation, meant that you sit down for 60 days at the max around the table. And we'll bring all the creditors, not just the initiating creditor, all the creditors that are involved in this farm operation, and with the help of mediator, see if we can work out a solution.

MARK STEIL: And most of the time you could?

JACK MORRIS: Well, yes. I'd say that in majority of the cases, a favorable solution was reached, and it wasn't always write downs. There were other things that mediators were able to come up, and predators and the farmer come up to a solution. I think the thing about it is that the thought process in putting that together, and I think, Jim, you were involved in lobbying for, it was the getting those negotiations back on track, which had broken down. And we dealt with creditors and farmers that hadn't talked seriously for some time.

JIM LANGMAN: I think went to-- it was other things, though, that we lobbied for, too. I mean we were lobbying for a minimum price on agricultural commodities which some agreed some did not. And I still feel pretty strongly about that that-- You can say all you want to. The prices are up right now. Corn is approaching $3 around here. In some areas it's over $3. But, if you look at the cost of a new combine today, that's well over in excess of $100,000, almost approaching 200,000, and you're raising 116 bushel corn to 150 bushel corn in different areas of the state. We still don't have a good enough price to pay for those machines. I mean, it still isn't in a fair.

JACK MORRIS: I agree, Jim. And, also, if you're a livestock farmer today, and you look at $3 corn to $85 corn, then it's really hard. A dairyman today is kind of getting close to just about break even given today's prices given the fact--

JIM LANGMAN: You know what?

JACK MORRIS: --the input costs are so high.

JIM LANGMAN: We were talking earlier about when our barn burned down here at the farm in 1979, Jack. You were one of the first guys at the door when it burned down. And the price of milk in 1979 when that barn burned down was $12.


JIM LANGMAN: What is it today?

JACK MORRIS: Well, it's probably around $13, but the cost of production are going up. With this corn, price to where it is and the other input costs going up, it's difficult. And you've got to get production to make it work.



MARK STEIL: This is a Special Mainstreet Radio broadcast. We're talking about the farm crisis. We're talking to you from the Jim and Gloria Langman farm just West of Starbuck in Western Minnesota. We're at the kitchen table and talking about things that peaked, I guess, about 10 years ago, kind of the 10th anniversary. 1985 was a pretty tough year. Listening to our story before and hearing David Stockman talk about his famous comment that he couldn't understand why anybody would want to help farmers. That must have touched a real nerve out here. Did it discourage you, Jim?

JIM LANGMAN: I don't think it discouraged me, but it's just he-- it's interesting that he's the head of this-- or, at that time, he was the head of the OMB. He didn't understand agriculture.

JACK MORRIS: Not at all.

JIM LANGMAN: Because, to understand agriculture, how it actually works, it's kind of incredible because your paychecks come through the federal government. And if it wasn't for that at that time I don't think there'd have been anybody staying out here. And they're going through the same kind of struggles. Now, they're lobbying this farm bill thing now, and it's the same old thing. They're going to cut subsidies down. And, if they do that to rural areas, the small farms in the rural areas are really going to hurt.

MARK STEIL: David Stockman was from a farming background. I understand he grew up on a farm, but that's one of the interesting footnotes, I guess, of this whole thing.

JACK MORRIS: Sometimes statements like that tend to turn people on and encourage them to work harder and get together and band together too.

MARK STEIL: Well, that's one thing I found interesting.


MARK STEIL: That after that comment, that did seem to-- if you go back and read some of the newspapers, the magazines from that period, that kind of marked a turning point.

JIM LANGMAN: Another one of those statements was-- who was it that said will export the farmers? Was that Reagan himself, or was that Stockman?

MARK STEIL: I think that might have been Mr. Reagan.

JIM LANGMAN: Yeah, we'll see. Then it turned on him, it was export Reagan, you know. So it was funny how that was all political and people that were in the farm movement got politically labeled in different ways. In fact, in about 1975, I was on the Republican committee, and then, of course, when the farm crisis came, Jackson stayed here, and he was a Democrat, so I was labeled a Democrat. And it was mostly labeling because I don't think anybody knew who I voted. Kind of interesting.

MARK STEIL: But what I was interested in, was kind of getting at is that Washington congressmen, senators, some of them seem to be kind of slow to grasp what was actually happening, say, in '83, '84 when people were talking a lot about the farm situation but not much was being done yet. Do you think some of that was because they had taken an attitude that, well, here come the farmers again and they're going to be telling us we need to do this? And it's so bad out there that people are losing their land. And we know that in a few months it'll disappear.

JIM LANGMAN: Yeah. I do think that, for instance, when the protest in '79 the tractorcade to Washington, that they did think that the farmers would go away. And the farmers did go away. I mean, there were only so many that could stand to stay out there in Washington for amount of time. And those were very dedicated people, and the American Agriculture Movement had stayed in Washington for weeks and weeks on end with their tractors and their families back on the farms, dedicated people.

What they needed at that time is they needed more help. I mean, there was still 2 million farmers, and there was only probably 30,000 of them out there doing the job for the whole works. And if the farmers had-- when I went to Washington in 1979, I had never seen so many farm caps in one place at one time at the same-- it was incredible. But they needed to have more, and they needed to follow through. And that's a problem today.

The problem today is that the farmers are out here fighting in the mud to get their crop out while the legislators in Washington are making decisions about what their lives are going to be in the next seven years in the future. And I think that process, the political process, that farmers really still need to get involved more in that process and do not. They don't have the time.

JACK MORRIS: Yeah, right.

JIM LANGMAN: They're fighting with--

JACK MORRIS: Yeah, they're just working night and day to get--

JIM LANGMAN: Get their crops out.

JACK MORRIS: --right now.

JIM LANGMAN: And they have no way to get out there.

MARK STEIL: Julie from Minnetonka is with us.

AUDIENCE: Hello. I guess my comment is that, during the farm crisis, I really was involved in it in several ways because I was a farm broadcaster in Southwestern Minnesota. My family was on a farm. I was dating an attorney. Many of my close friends were young loan officers with Farm Credit Services or small banks. And I guess I've been listening all morning as I'm driving because I'm actually in Southwestern Minnesota. And I just-- there's two points. One point is that everybody really suffered.

If you would have seen the videotape of those faces, I still have some of that videotape. And there's nothing like the look in those people's eyes, whether it's the sheriff having to sell that farm or attempt to sell it or someone from groundswell or that farm family. It was really, really a difficult time. And I'm not sure people have healed from that yet. And I guess the second thing is that I don't really know that we've done a good job educating people. I live in the big city now, and I don't know that they know really what farming is all about and what happened in the '80s. And those are just my comments.

MARK STEIL: All right. Thanks. Thanks for calling in this afternoon. Yeah. The first one, everyone suffered, you certainly could see it in the smaller towns, in all the towns really with the businesses closing.

JACK MORRIS: Right. Yeah, that's true. When you get out in this Starbuck, Glenwood, Cyrus, Lowry situations, everybody's a farmer whether you live in town or live on the country. And when the farmers are hurting, everybody is hurting. And so when they're under stress, everybody feels the stress.

JIM LANGMAN: She talked about the sheriff feeling the strain, and the sheriff of Pope County at that time was Gerald Moe. He's no longer here, but Gerald Moe was a very good sheriff.

JACK MORRIS: Excellent.

JIM LANGMAN: He handled the situation very well. I mean, I spent quite a few hours in the Sheriff's Office because of the protest because they were afraid that Jesse Jackson was-- life would be threatened then, and lives of people were being threatened, which was incredible as far as I'm concerned. But it does happen when you get this type of situation. And Gerald Moe really handled that well.

MARK STEIL: The people who were demonstrating at that time of the Groundswell groups and the others, you know, I think got along well with the law enforcement. Was there any radical undercurrent groups coming in from the outside, or was most of that just talk?

JIM LANGMAN: No, there were always radical groups at-- of course, American Agriculture Movement. Groundswell by some was labeled radical, but it really was not. It was a non-violent type organizations. If you call violent taking a tractor to a protest, then so be it. But there were radical organizations that were undercurrent influencing and sending letters to sheriffs and sending letters to radio stations and things that we had nothing to do with. And so, those things happen when you're in the public eye.

MARK STEIL: We're going to take another phone call now. Cliff from Little Falls is with us.

AUDIENCE: Yeah, good afternoon. Good program. I'd like to speak to price. I think it comes down to, if agriculture crisis is ever going to get settled, it's going to come down to producers. Those that are working in the land, making the food are going to have to get a price. And, from my understanding, about 98% of the populace in the United States are consumers of food, and it's about 2% produce the food and fiber.

Now, when the Cargill's and the Archer Daniel Midlands and all the rest of them out there be it Med-Am or MPI or whoever it is processing, manufacturing, wholesaling, and retailing takes the lion's share of the dollar that goes into food. And the producer just isn't getting it. It's my understanding it costs more to buy a box, the box that corn flakes comes in, than it does to buy the corn from the farmer to put in there, and that for oats for Cheerios or for whatever. And milk, $13 milk in the store, when it's processed and put into a bottle is about 35 bucks to 100, the farmer is getting roughly 13 or 12.5 or whatever.

And until we as consumers want to stand and say, hey, I want the guy producing or the man or the woman, the woman is very much involved in agriculture, producing this food, I want them to get more. Until we make that stand, I don't think we're going to see the agriculture crisis be solved.

JIM LANGMAN: Probably not.

MARK STEIL: Thanks for your call. Jack Morris--

AUDIENCE: Thank you.

MARK STEIL: --how about that? I mean, are consumers ever going to stand for higher food prices, to put more money in the farmer's market?

JACK MORRIS: Well, I'm a consumer. I certainly would. My family would. We like good quality food. I think American consumers like good quality food. The difficulty is getting it to the farmer, and the distance between the field and the counter in the shopping center or wherever. So, yes, I think that this is a problem. It's certainly something that needs to be looked at, and somehow we need to try to get more return for these crops.

And the thing that we're getting into now of a popular thing and thought out in the area is value added, where the farmer can actually hang on to some of that production longer, get it, and to participate in this value added or this added cost of getting it to the consumer. Well, the ethanol plants are example, Jim, and the vegetable processing or freezing plant that we're building in [? Bruton. ?]

JIM LANGMAN: I was going to say some of those are fairly non-controversial, although--

JACK MORRIS: Well, they are.

JIM LANGMAN: But some are very controversial, and I'm thinking of the large hog operations.



JIM LANGMAN: And those are sprouting up.

JACK MORRIS: Yes, they are, and dairy operations also. And the thing about them, at least the ones that I'm dealing with, in the case of the dairy farm in my county, instead of one family being involved, there will be three families involved. And so, to some degree, I think we need to understand why that is happening. And it's happening because of the labor involved in dairying and the fact that dairymen-- Jim, used to be a dairyman guy. Dairymen just can't be tied down at 365 days a year.

MARK STEIL: We have Ron from Litchfield is on the line with us.

AUDIENCE: Good morning or afternoon rather. I wish you'd discuss the appropriate technology issue for a little bit. I wonder if one of the problems we had in the '80s was wasn't that too many farms, especially small farms, had only one option in the technology to use, which was basically high machinery, high cost, high capital, low labor type equipment and technology to use in production. We're still farming, and we have gone to rotational grazing, low technology. We don't buy new machinery anymore. We just raise our animals as cheaply as we can off the grass, the grass that we farm. And it seems like the lower tech we go, the farther we get into rotational grazing, the more money we make.

I think a lot of small farms, family farms still could be in business, but research needs to be done to come up with appropriate technology for the small farm situation. I wonder if you'd discuss that a little bit.

JACK MORRIS: Well, I'd like to relate to that. I think that, here in Western Minnesota and specifically out at the Morris experiment station there, it's going to become one of the centers for research in grazing of dairy and sheep. And the research has taken a new priority over there. And that's one of the things that is going to be researched. And, hopefully, we can learn some things along with the farmers that are doing this.

MARK STEIL: How about that, Jim Langman? Is it is it possible to go back in some ways, I guess, to a lower technology type farming?

JIM LANGMAN: Yeah. I know that some of those around the sustainable agriculture type things are around the area. And I think it's a great idea. They're using less chemicals, which I think we're sometimes killing the soil when we're putting too much of that on. So when you go through this, you make some changes in your philosophy and so forth. And I think that it's a very valid point.

JACK MORRIS: I'd like to add, too, that to go that way, it does require some very, very excellent management. This isn't an easy thing to do to succeed at grazing. The successful grazing program takes a lot of--

JIM LANGMAN: It's labor intensive.

JACK MORRIS: --kind of smarts.

JIM LANGMAN: It's more labor intensive--

JACK MORRIS: Labor intensive.

JIM LANGMAN: --and so forth.

JACK MORRIS: Labor intensive, and you got to do it right, or you're not going to be able to make it work.

MARK STEIL: Before we leave this afternoon, I'd like to get a quick thought from each of you. Jim Langman, we're at your farm in Western Minnesota. When you think back to the farm crisis, what's the dominant thought or memory that crosses your mind?

JIM LANGMAN: It was a pain to go through. It was a pain. It was a hard, hard time. We had a lot of people that came to meetings that came to our American AG meetings and Groundswell meetings that were old people that had went through the Holiday Association Movement, and they said the same thing. They didn't want to talk about the 1930s.

MARK STEIL: Right. How about you, Jack?

JACK MORRIS: The question was again of what?

MARK STEIL: What do you think of-- what's the first thing that crosses your mind?

JACK MORRIS: Well, the first thing that crosses my mind is the tears and the stress that I saw across my desk with every mediation request that I worked with and the difficulty that this brought to those in that situation. Because farmers traditionally work hard, and they like to pay their bills. And this was a situation where they just-- because of many factors, that just turned on them, and they couldn't do it.

MARK STEIL: Thank you. That was Jack Morris the Pope County extension agent. And thank you, Jim Langman, for having us in your home this afternoon. And that brings to a close our program on the farm crisis. I'm Mark style, and thanks for being with us.

SPEAKER: Mainstreet Radio's coverage of rural issues is supported by the Blandin Foundation, providing leadership training through the Blandin community leadership program.

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