Food

Hightower: The Speculating Farmers of Wall Street—Making Quick Money Has Seized American Farmland

Financial trusts snatch up valuable U.S. acreage, then convert into fast-buck investments for global speculators.

John Steinbeck’s novel “The Grapes of Wrath.” Woody Guthrie’s ballad “Deportees.” Edward R. Murrow’s documentary “Harvest of Shame.” Every decade or so, the public is shocked by yet another discovery that migrant farmworkers are being horribly abused by the wealthy masters of the corporate food system. And here we go again.

Last November The New York Times reported that the workers who grow and harvest the cornucopia of fruit and veggies in the rich fields of California’s Salinas Valley live in a constant crisis of poverty, malnutrition and homelessness. Toiling in “America’s salad bowl,” they literally cannot afford to eat the fresh, nutritious edibles they produce.

The valley is a gold mine of groceries, generating billions of dollars in sales that have enriched landowners and corporate executives and turned Salinas Valley into farm country with Silicon Valley prices. Unable to afford good food, the workers eat poorly — with 85 percent being overweight or obese and nearly 6 out of 10 diagnosed with diabetes, while many more, uninsured and unable to afford testing, go undiagnosed. Especially appalling, about one-third of elementary schoolchildren in the Salinas City district are homeless. They sleep with their families in tents, abandoned buildings, toolsheds, chicken coops or on the ground, next to the rows of crops they tend.

Allowing such abject poverty in our fields of abundance is more than shameful: It’s an oozing sore on our national soul that’s made even more immoral by the fact that our society throws 40 percent of our food into the garbage. But outrageous treatment of farmworkers is not limited to Salinas. You can likely find it down some rural road near you.

When we find it, let’s act on it. Yes, donate money and time to food banks, but it’s even more important to join with farmworkers in local, state and national political actions to stop this gross, un-American inequity.

Adding to the inequality that has affected so many farmworkers is the fact that Wall Street has our nation’s farmland.

Our nation’s farms conjure up Americana, the old homeplace and our rich, rural culture. Less bucolic, however, is the assortment of financial trusts and hedge fund hucksters that are buying up these farms and converting them into fast-buck investment packages for superrich global speculators. One of these Wall Street investment schemes is called Farmland Partners. It’s run by a couple of slicks trained in mergers and acquisitions as executives at the investment powerhouse Merrill Lynch. Rather than being sodbusters, Farmland Partners are tax busters, using a legalistic plow called a real estate investment trust (or REIT) to obtain enormous tax breaks to subsidize their scheme. With this special subsidy, Farmland Partners has attracted hundreds of millions of dollars from investors to buy up farms and ranches — who now own 295 agricultural properties covering 144,000 acres in 16 states including California’s Salinas Valley.

Of course, the Wall Street plowboys don’t soil their own soft hands by actually farming; they’ve figured out how to “work” the land without touching it — and how to harvest a sweet profit. The syndicate hires tenant farmers to do the sweaty work of plowing, planting and nurturing the crops. This tenant system produces a double-line cash flow for the faraway owners: Farmland Partners charges the tenants rent for tilling the corporate soil, then the partners harvest a sweet share of any profits from the sale of crops that the tenants produce. “It’s like gold,” says the founder of one such scheme, “but better, because there’s cash flow.”

Meanwhile, the young farmers whom America desperately needs — those who actually want to, you know, farm— are having a hard time finding affordable land to get started. These new generation farmers can easily be outbid for good land by Wall Street speculators who have the cash flow from tenants and the subsidy from taxpayers to underwrite their financial contrivance.

To prevent the money schemers from literally walling off young farmers and fight this insidious Wall Street takeover of agriculture, connect with the National Young Farmers Coalition.

 

Populist author and radio commentator Jim Hightower writes The Hightower Lowdown, a monthly newsletter chronicling the ongoing fights by America’s ordinary people against rule by plutocratic elites. Sign up at HightowerLowdown.org.

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