Strawberry Fields Forever

[embedyt]http://www.youtube.com/watch?v=J3jrWVp2L7U[/embedyt]Marquel, TPVs NYTimes Agricultural Economics Section correspondent was spreading some butter on his baguette, when he stopped to read Cash Crops With Dividends: Financiers Transforming Strawberries Into Securities.

With its steady income stream, farmland is proving to be a ripe offering for sophisticated investors. And soon the unsophisticated. Investment companies intend to have shares in farming in the open stock market very soon. Soon we can all be farmers in the afternoon, just as Marx yearned to be.

Marquel thought this historically ironic and socially dangerous. But what on the stock market is not? Stocks in steel and cars and coal affect just that industry and there are usually substitutes. Marquel couldn’t be sure what this reminded him of but it wasn’t good.

This means individual farmers will be tempted to sell out to these groups, many or all of them who also take a piece of the farmer’s action…a percentage of his crops. If financial disaster hits, who will be in charge of farming, the farmers or the investors? What happens if the company itself goes bankrupt? All the farmers, their land, and a piece of their crops goes to the highest bidder.

Marquel had a vision of golden arches all across Kansas and the rest of the Midwest. Why not? Cut out the middleman has always been a principle of cutthroat capitalism. It was time to talk to some farmers. I took a Greyhound across America’s farmland and got off occasionally when I spotted a farmer.

My first farmer knew nothing about the stock market.

“I wouldn’t invest in farming if the whole world was starving,” he said. “These are the bright guys running our economy? Can we vote for them or vote them out of office?”

He was sorry to hear that we don’t get to vote on our economic emperors. I got back on the bus and continued on my tour.

My next farmer was getting on the bus so I sat down next to him and we talked.

“Yeah, I heard all about it, I even signed up” he said, shaking his coveralls and covering me with hay. I picked off a long piece and put it in my mouth to look authentic and fit in. “They got ten percent of my clover crop which is good for the soil, but not for profits. Now they’re suing me for breach of contract. They want me to grow corn for corn syrup. I prefer to grow sugar beets which is better for the farm and healthier.”

“They can tell you what to grow?” I asked.

“They say I have to grow the most profitable. I’m not a farmer. I’m a marketer. It sucks. They know nothing about farming. All they know is interest rates and amortization.”

“That’s a fancy word for a farmer,” I said, sucking on my straw.

“It’s basic econ 101.” He said. I raised my eyebrows. He said, “Iowa State.”

I don’t remember amortization from college. I guess because I didn’t take econ any number.

We went on. The sun was setting. A few stops later I saw a farmer dropping someone off. I went up to him and had a coffee while the bus idled.

“Those guys offering these deals are the slipperiest creatures I’ve ever seen. You buy stocks in those companies, it’s like buying penny stocks. It’s a crash waiting to happen. It’s not like agronomists are doing the investing. If they can get five good years out of a farm, why would they care about returns later on? What corporation does?”

“That’s pretty advanced criticism,” I said.

He tapped his head. I chewed my straw. He said, “Princeton, ’99.”

I felt better. At least some of our farmers, maybe most, are halfway prepared to resist this onslaught.

But as my last farmer told me, “A farmer’s always one step away from bankruptcy, even in a good year.”

All the education in the world can’t pay off a mortgage. Things don’t look good in the heartland. Especially with straw in your mouth.

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BY MARQUEL: Strawberry Fields Forever