The Farm Crisis is a 90-minute film produced by Iowa Public Television that examines the economic and personal disasters that afflicted the agriculture sector in the 1980s.
Narrated by NBC News reporter Harry Smith, The Farm Crisis examines the tragic circumstances faced by farmers for most of the 1980s, when thousands were forced into bankruptcy, land values dropped by one-third nationally, and sky-high interest rates turned successes into failures seemingly overnight. Original music by Iowa-based recording artist Chad Elliott sets the tone throughout the program.
The program features interviews with policymakers, business owners, economists, and farm families, including Gov. Terry Branstad, Sen. Charles Grassley, Sen. Tom Harkin, former Rep. Jim Leach, the late Mark Pearson, former Sen. Tom Daschle, economist Neil Harl, and recording artist and Farm Aid Founder Willie Nelson.
Funding for The Farm Crisis was provided by: Farmers Mutual Hail Insurance Company of Iowa; Humanities Iowa; John and Carole Lea Cotton and Tim and Wendy Haight.
This project is funded by Humanities Iowa and the National Endowment for the Humanities. The views in this program do not necessarily reflect those of Humanities Iowa or the National Endowment for the Humanities. By Farmers Mutual Hail Insurance Company of Iowa which has proudly supported Midwest farmers for 120 years with consistent service and financial protection. By John and Carole Lea Cotton, in appreciation and respect for the farm families of Iowa, both past and present. And by Tim and Wendy Haight, believing in the importance of preserving the history of Iowa's family farmers.
David Sentor: The farm crisis of the '80s, it changed rural America forever. The jobs disappeared, the main street businesses closed. And the young people had to go to a city somewhere else to get a job. And so that farm crisis completely altered the fabric of rural America.
Hear Ye, Hear Ye, let it be known to all people that by the authority vested in me, Sheriff of Wayne County, and by the order of a special execution issued by the courts, the district court for Wayne County, I will be offering the following for sale.
(music) Their empty faded squares on the wall that once held frames, and the frames once held pictures black and white. Of children running 'round this place, what now are empty rooms, they're the children of my grand folks, my parents and me and my wife. They'll put up one more white cross today. This time for my family's century farm. It took everything deep down in me just to keep those tears inside, like a dry well from which we must move on. I am like a dry well from which we must move on. But I'll cry one tear for what was lost. And I'll cry for the pride that was torn. We spent all our lives and all our money just to try to pay the cost of being farmers cut out in the storm.
During the 1980s, American farmers confronted an economic crisis more severe than any since the Great Depress. Agricultural communities throughout the Midwest and across the nation were devastated. Families were forced from the land, lenders went belly up and businesses on rural main streets closed, many to never reopen. It was a decade of turmoil. Grassroots activists chanted "no sale," politicians marched alongside struggling farmers hoping to change government policies. Voices were raised in song and protest letting farmers know they were not alone.
And let's tell the President that we're not going to fade away quietly into the countryside. Every day 250 farm families go out of existence, 250 today --
The farm crisis was the result of a confluence of many things -- failed policy, mountains of debt, land and commodity price booms and busts. And add two droughts, one in 1983 and the other in 1988. Farmers who were in the wrong place at the wrong time were crushed. Iowa was the epicenter of disastrous events that brought generations of farmers to their knees. In 1983 public farm auctions numbered around 500 a month. White crosses covered courthouse lawns, symbols of farms lost to the economic catastrophe. By the end of the decade, an estimated 300,000 farmers defaulted on their loans, and more banks failed in 1985 than in any year since the 1930s.
In the shadows of insolvent banks, abandoned farmsteads and shuttered businesses, there was human misery.
Karen Heidman: The opening statement of the suicide note was, "the farm killed me."
Senator Tom Daschle: It was one of the worst times that anyone in agriculture could remember. It was a time of attrition, a time of deep, deep pain, a time of great uncertainty.
Dean Hagedorn: There was always a feeling, an underlying feeling of fear, waiting for the other shoe to fall.
Paul Lasley: Being displaced from farming is more than simply the loss of a piece of real estate. Often times it is part of one's identity, one's heritage, one's status.
Norma Fetter: When we came home, the little one, Joe, he was five years old. He said that daddy was out in the barn and he was out in the machine shed with a rifle. And that's how we found him when we came home from church.
The seeds of the 1980s farm crisis were sown decades earlier. During the roaring twenties the nation's farmers were saddled with debt. When those debts came due in the 1930s, half of Iowa's farms were lost. History would repeat itself 50 years later. The 1980s economic crisis would wipe out nearly another one-third of Iowa's farms.
While every sector of life was affected by the Great Depression, the farm crisis of the 1980s was not the concern of many Americans.
Rep. Jim Leach: In the 1930s, everyone in America suffered -- urban people, the rich banker, the poor farmer. Everybody lost massively. Everybody was living close to survival. And it meant for kind of a national unity. With the farm crisis in the 80s, basically it was only the farmer. And this meant the farmer was alone in an island of difficulty. And that is really something that eats at the soul sometimes deeper than being part of a more general phenomenon.
In the post-World War II era, farmers witnessed revolutionary advances in agricultural technology -- new machinery, seeds, pesticides, fertilizers, resulting in greater efficiency, greater productivity. During the 1950s and 60s, American agriculture's biggest problem was what to do with the huge surpluses of grain. All that changed in the 1970s as the massive stockpiles were drawn down, sometimes to precariously low levels. As a result, commodity prices rose. Then in the early 1970s, poor weather conditions results in diminished yields overseas. Demand for U.S. agricultural products exploded. The Soviet Union negotiated a multiyear contract for wheat and feed grains in 1972. And within a span of two years, wheat priced doubled, corn prices tripled. Suddenly, America's unprecedented ability to produce food looked more like a blessing than a burden. And there was serious talk that the U.S. would not be able to keep up.
In 1973, President Nixon's Secretary of Agriculture, Earl Butz responded by calling upon American farmers to plant "fencerow to fencerow," and he told them "to get big or get out." Producers took his words to heart and the race to feed the world was on. With production in high gear and prices continuing to climb, 1973 and '74 were prosperous years in rural America. And for the first time since record-keeping began, per capita farm income actually exceeded that of urban Americans. Life was good.
November 15, 1976 -- "Finished combining corn tonight. The new bin is full. We really feel for the first time there is enough money for everything. The bills are getting paid. The farm is half paid for. -- Farm wife, southern Iowa.
Kaye Hagedorn: So I guess maybe I set my cap for a farmer because oh, that just sounded so romantic and I ended up marrying an Iowa farmer. So that's how I got here.
Dean Hagedorn: My dad had always been a cattle man, had cattle and I started in partnership with him and then eventually started renting from him, bought his machinery and in the early 70s he bought a house in town and we moved into the "big" house. We had a small tented house to start with and then moved in where mom and dad were and then he moved into town.
Dean Hagedorn's land was in northwest Iowa. His family had farmed in the area for 100 years. Dean and his wife Kay and their three children grew corn, soybeans and alfalfa on 560 acres, both owned and rented. But they also raised cattle and hogs. Diversification was the name of the game back then. They were young and getting into agriculture in what seemed like a perfect time.
Dean Hagedorn: Pretty much the best of everything -- the independence, the freedom. I still believe maybe the best place to raise kids.
Kirsten Hagedorn: Your whole family was part of it. It was really integrated and so, you know, my dad didn't go off to work and then not see him all day. You know, he was home, he was there and we were part of that life. So instead of him having a job, we as a family had an occupation.
Kaye Hagedorn: Dean used to tease me and say, this is not Old McDonald's Farm, this is a commercial operation and we don't need to have every animal known to man. I was just having a wonderful time raising all kinds of animals just for the sheer joy of learning new stuff.
Indeed, life was good down on the farm. It was a familiar story for many making their living on the land.
Bob Sullivan: Our goal was, I think it's a responsibility to leave every farm better than we found it and I think we stayed with that all the way through.
Bob Sullivan represented the third generation of his family to farm near Dunlap, Iowa. He and his wife Theresa and their 16 children grew corn, soybeans and alfalfa and raised cattle. In the early 1970s the Sullivan's had good net worth and could borrow anywhere. So they expanded their operation to 1400 acres to get their seven sons involved.
Bob Sullivan: We were always a family. The good thing about it we could always work together, even the kids and that was a good thing about it. And so often that people say, what a neat family you have, but then couldn't we just borrow one of the for a while? And I said, well you could, you can borrow them all for a day but you can't have one of them to keep.
Wendell Tuttle: I had four head of horses and a little horse machinery. We started in 1946.
Third generation grower Wendell Tuttle farmed nearly 40 years on 330 acres in southern Iowa. He bought his last section of land in 1965 and within a decade had it nearly paid for. Tuttle also sold insurance to supplement the farm income while one of his sons and daughter-in-law helped run the operation.
Wendell Tuttle: In 1967, we built a milking parlor and a big free stall barn with 60 stalls in it to hold 60 cows. We were milking 55 cows twice a day and just the family and everybody pitched in, everybody had their job. But I enjoyed it. I grew up on the farm and I would sometimes say I'd like to be there today. But the shape I'm in, I'm close enough to the farm now.
Norma Fetter: We lived on the family farm. He had grown up there, lived there all his life. We got married in '58 and he went to the service. When he got home he took over the farming operation. So spring of 1960 we moved to the farm and raised our family there.
Norma Fetter and her husband Phil farmed near Chelsea, Iowa. They grew grain and raised livestock with their 10 children. Phil was the third generation of his family to make a living on the land.
Norma Fetter: He worked hard, farmed other than his own farm, rented out a lot of other ground in the area. People that had jobs, you know, that did not farm and whatever rented their ground too. So we had a large hog operation at one time, cattle. I had 300 chickens. So we had eggs and our own chickens and whatever. I grew up in town so it was totally new to me when we moved to the farm but I liked the fact of the privacy of the farm, whatever. In fact, living in town now I still kind of miss that.
As land values increased, lenders and farmers alike mistakenly concluded the ideal conditions would become the norm. Borrowing became the order of the day and there were plenty of lenders eager to accommodate optimistic farmers.
Alan Tubbs: There was intense competition for agricultural lending at that time, a very aggressive Farm Credit System and banks were of course trying to compete with them. And even within the Farm Credit System, you had the Federal Land Bank, you had the Protection Credit Associations. And the Production Credit Associations also became very aggressive in land loans. So in a way you had, within the same system, a competition between PCAs and Federal Land Banks and then you had the institutional lenders out here trying to compete with that competition and so I think everybody got a little too laxed in their lending at that time and that also escalated land prices and contributed to the inflation that was going on particularly in land.
Money to borrow was everywhere, it seemed. Private sector lenders came on board in addition to entities created by the federal government during the last great Farm Crisis. There also was the Farmers Home Administration created in 1947, often called FMHA, the so-called "lender of last resort." Farmers of all income levels leveraged the rising value of their land as collateral to secure new loans. The benefits of upgrading or expanding a farm operation were viewed as unquestioned acts of faith. Evangelists of growth preached a powerful message.
Mark Pearson: You know, it was like you wanted to own things. You didn't want to own paper, you didn't want to have cash, you wanted to have it in something, in dirt. Successful Farming ran a cover story, "Black Gold" and that was the push.
To young, ambitious farmers, the time was ripe with possibilities their parents never could have imagined. Older generations observed with caution. Yet, they understood younger farmers faced a new world, one in which it seemed the risk of seizing the moment was as great as doing nothing at all.
Chuck Hassebrook: They had supposedly the smartest people in the country telling them, some of the smartest people in the country, ag economics and bankers and people like that, telling them that land couldn't go down and that they ought to buy it sooner rather than later and leverage themselves because it's always going to go up and they can borrow more to buy more.
Not everyone was convinced the future was fail safe.
Gary Lamb: I didn't fall into this trap like a lot of farmers did. And I can understand it. I don't blame them. They were listening to all the experts and I really can't explain what it was, I just had this feeling in the pit of my stomach.
Gary Lamb has farmed in east Central Iowa for over 60 years, raising corn, soybeans, hay, hogs and cattle on 400 acres. His ancestors helped settle the area making Lamb the fourth generation of his family to be a steward of the land.
Gary Lamb: At the time, uh, my banker came out on a Sunday night, he had never come out here before on a Sunday night to help me do chores. That was at the big silo across the road. I heard the dog barking so I opened the door and there was my banker. And he said, say, Gary, are you aware there's 280 acres right east of you for sale? And I said, yeah, I heard it is. And he said, you making arrangements to buy it? And I said, no. I said, I'm farrowing 600, 700 head of hogs and feeding out a couple hundred head of cattle and I've got 125 stock cows. I said, hell, I'm -- and I was renting another couple hundred acres of row crop ground, I said, I'm staying busy from daylight until dark now. I don't need another 280 acres. All I need is a return on what I've got. Well, he said, you have to -- he said, when you get your head straightened out, he said, I know you, I know your operation, just give us the word and we’ll buy it for you. Well, needless to say I didn't do it. But if I would have listened to my financial expert, my banker I could have not only lost that 280 acres, I could have lost everything.
Lamb's instincts proved to be spot on. The optimism felt by many in the agricultural sector during the 1970s would be short-lived.
Neil Harl: October the 6th, 1979, they slammed on the monetary brakes under new Chairman Paul Volcker, who had been in office only since August of that year. And the consequence was it threw a lot of farmers into the windshield when they slammed on the monetary brakes. We had not had an aggressive Fed for some time and no one, I think, really seriously thought about the possibility that the Federal Reserve could cause such a change in monetary policy so quickly.
While the Federal Reserve's new policy managed to hold the line on inflation, it pushed real interest rates to levels not seen since the Civil War. Interest rates soared from single to double digits, hitting a record 21.5 percent in 1981. The Fed's actions made the cost of borrowing money prohibitive for all Americans. But the effect on farm families and rural bankers was especially severe.
Tom Huston: We could see coming in through the examination reports trouble starting to build. And you could see that loans were getting larger and as interest rates started moving up people got so they couldn't pay their interest let alone make a principal payment, and more and more loans just had to be extended and things started to not look so good.
Alan Tubbs: I think individuals always believe that what happens in the short run is going to happen in the long run. And so when we had this inflation going on for the late 60s all through the decade of the 70s, why, producers believed that that was what was going to happen. And at the same time we had a Federal Reserve policy that was holding interest rates in single digits while agricultural land was increasing at double digits. So the signals that were sent by policy and by the inflation that was in the economy turned out to be bad signals.
Then to make a bad situation even worse, in late 1979, the Soviet Union invaded Afghanistan.
Jimmy Carter: I have decided to halt or to reduce exports to the Soviet Union in three areas that are particularly important to them.
In protest, President Jimmy Carter stopped the shipment of farm products to the Soviet Union, costing the American farmer a crucial overseas market.
Wendell Tuttle: When President Carter put the grain embargo on, I had several hundred bushels of grain in bins. And, like I say, my net worth dropped $20,000 overnight. About that time I had to refinance the farming operation and he said, well you can't do that. You lost $20,000. I said, I didn't lose it, Carter lost it for me. Well then I had to refinance the farm and I was paying seven percent interest, had to refinance through John Hancock at sixteen percent. Two years of that and I couldn't pay anymore.
Paul Lasley: Timing was everything. So the most vulnerable were those beginning farmers or farm families that expanded, took on debts to expand their operation for a son or daughter or son-in-law, daughter-in-law to get started in farming.
Debts piled up. With less demand and lower prices for their products, U.S. farmers had no way to pay back their creditors. Yet many borrowed even more money hoping that better crops and better prices would rescue them in a year or two. It didn’t happen.
Senator Charles Grassley: Farmers were doing what they thought they had to do to protect themselves. They were encouraged to get bigger because bigger is better, you know. And you just kind of get yourself, like a dog chasing its tail, you never catch it and it just gets away from you.
Norma Fetter recalls things running smoothly on the farm during the 1970s. She and her husband Phil enjoyed taking care of the livestock. But even that proved to be perilous.
Norma Fetter: We got a swine disease in the hog operation so that curtailed raising hogs. So that was kind o the beginning of it. Then we got a large loan with Federal Land Bank to keep things going and we just didn't have the money to pay back the loans when they were due.
The Sullivan family found itself in a similar situation.
Bob Sullivan: We operated on borrowed capital a lot of the time. We never had any money of our own and that is what got us as far as we ever made it. But then when the interest rates went up so high we were kind of getting behind on the operation and then all of a sudden they took about, we figured 65% of our equity with the same thing. So the banks got worried and I said, well, what are you talking about? I said, we're doing the same good job farming that we did when you loaned us the money, we still are. So you've changed, we didn't.
Collapsed demand, tight money, and high interest rates were all coming together to create the perfect storm. After land values peaked at $2,147 per acre in 1981, farmland values crashed soon thereafter. Two decades would pass before land values fully recovered.
Mark Pearson: I can remember visiting with a farmer who made a statement which became prophetic, which was, farmland prices will not go up again for a generation. It will take a generation for these memories to be washed away if what happened with some farmland prices go back down. And he was right.
For the first time in history, total interest payments on farm loans exceeded total net farm income. In January 1984, the Federal Reserve Board issued a report estimating that one-third of all American farmers held nearly two-thirds of the nation's total farm debt. Many were buried in debt almost before they knew it. They failed to understand why their lenders suddenly went from handing out money with a handshake to becoming to tight-fisted and in some cases critical of how the farmers ran their operations.
Theresa Sullivan: I can remember the day that Bob came home and said the bank was cutting us off and they were going, they might start a foreclosure. I was baking bread, homemade bread, and I really punched it down. First I had to cry a little bit and then I was angry. So I just kind of tore into it.
Bob Sullivan: Took it out on the bread, that's good.
Theresa Sullivan: Well, I had to have something to take it out on.
Bob Sullivan: But it was kind of a jolt to think that, you know, we thought we were doing well and everybody worked as a team and then all of a sudden, you know, we didn't have anything. That was quite a switch.
Rep. Jim Leach: There is nothing more dramatic for a family when one has been working at something all their life and working fourteen, sixteen hours a day only to lose money. And then the question, can you stay in the profession? Can you raise a family as you've been raised? And this was torturous and there was no farm community in Iowa that didn't have tremendous dimensions of just human difficulty. The fact is, farmers are optimists and they always have been. Otherwise one wouldn't be in the business. And to see that optimism eroded was one of the hardest things to live through and to watch as a representative of people.
(music) You know my name, but it's all so strange. We both grew up here, this place we call home. I know you, you know me well, how can you sit there at your desk looking at me like I'm some stranger. I ain't to blame, no and it ain't the rain, the powers that be are telling me to feel this shame and all my mama's words keep ringing in my ears, singing me a song about hard times. Come again no more.
Many farmers were embarrassed and ashamed by the situations in which they found themselves.
September 22, 1982 -- I've never been so terrified in my life. I've been to PCA and we are on the verge of ruin! The interest rates and low prices are simply destroying us. Our debt has climbed higher and higher, primarily because of interest. We owe over $18,000 just on interest for PCA for one year!
Kaye Hagedorn: The turning point was about the time that Dean injured himself and had to have spinal surgery. Sort of before that we borrowed money to operate and I had to go to the bank because I had bought three new boars and I got into the bank and they told me if I was going to be, if I was going to borrow money they had to rewrite all the loans because the interest rate had gone up. And I think when we finally kind of shut down we were paying something like 21% interest. It was, it was just enormous. I, actually both of us, were pretty naive. We didn't really think of farming as a business. It was a way of life for us. And that was a pretty shocking thing. We were not prepared for that. So it was initially when we had to rewrite those notes and then when Dean got hurt I think that's what motivated the bank to call the note and take the money out of the account that was going to pay rent to Dean's mother. And then everything changed for us. I was shocked but more than that I was shamed because I felt a fool. I didn't get it. I had no idea how things really worked. And I thought the man was my friend, he was my banker, he was friendly, I'm not saying anything against him but he was playing a different game than I was playing. And I was shamed.
Dean Hagedorn: When I couldn't pay my mother, I couldn't go pay my mother's rent there in 1984 I didn't know how I was going to tell her that. She didn't have -- she needed the money. She was a widow and had, at that time, still some farm payments left on the farm that she and dad had and still had owed some money. You know, and then to tell her I had lost the acreage and couldn't pay her beside that, I thought, how am I going to do that?
(music) I've been awake, up at dawn, every morning since I was born, since I can crawl. I've worked hard out on that farm, now you're telling me that I might lose it all. What is right? And what is wrong? I always believed these two things would stay where they belonged. And all my mama's words keep ringing in my ear, singing me a song about hard times. Come again no more. Hard times, hard times, come again no more.
So, where were the voices of caution? They were there but often went unheeded, they spoke too softly or they came too late. Individual farmers were hurting. No one really wanted to believe it was as bad as it was. But agriculture was in serious trouble. According to some, one of the most perplexing frustrations was the seeming indifference with which officials in Washington viewed what was happening on the farm.
David Stockman: And now that has all gone sour because it was based on unsound economics and because it was propped up with federal price reports and cheap credit that couldn't be justified. And I don't see why we have a responsibility to step in --
Neil Harl: We had a meeting in the Roosevelt Room at the White House in January of 1985 with David Stockman and that was a ruckus event, I must say. He came in late and almost before he got settled into his chair he started talking and being critical of the fact that agriculture had caused its own problem. At one point there was an exchange between Branstad and Stockman, with Branstad getting up and grabbing his chair and slamming it down for emphasis and said, I chaired the Reagan committee for re-election in Iowa, I think I deserve better treatment than this.
Governor Terry Branstad: And the President was very supportive and sympathetic. unfortunately, David Stockman, who worked for him and who was the director of OMB was pretty cavalier in his attitude and I think that really, considering all the stress and challenge we were going through in Iowa, we were not very happy and, of course, we didn't just take no for an answer. But obviously it was disappointing that we had to overcome the resistance from the OMB director within the administration. But I'm proud of what we did and I think we sincerely and emphatically fought for what we believed was absolutely essential.
It turns out the farmers proved to be skillful at politicking and publicizing their plight. They were determined not to go quietly.
We are on the threshold in 1985 of repudiating American history itself. You know, George Washington said that agriculture was our most important industry. Thomas Jefferson said that our tillers of the soil were our most important citizens and the backbone of our whole democratic republic. And then David Stockman comes along and says, unlike Washington and Jefferson and Lincoln, farm bankruptcies are needed. Forget David Stockman. Forget David Stockman. We're tired of it!
David Sentor: We had so many farmers that felt like they failed. I inherited this farm, my dad got it from my granddaddy and they felt like they failed. Well, when you have prices that are below the cost of production the farmer didn't fail, policy failed. And so just to make sure that farmers know that they're better off joining together for a common solution, supporting each other and speaking out.
By the mid-1980s it was nearly impossible to open a newspaper or turn on the television without facing images of farm auctions and foreclosure sales.
David Peterson: I get emotional when I think about some of the things I photographed. I get angry just like the farmers. I felt like I was one of them. I felt like I was really in their camp. You know, they talk about journalism being objective. Well, I think it's impossible sometimes to be objective in this kind of story. So I was subjective and that's okay. I was an advocate for them.
Reverend Jesse Jackson: When a farm closes in Minnesota, we must hurt in Chicago and feel the pain in New York!
Rural America was hurting. But amidst the suffering there were individuals, politicians and groups who wanted to be a voice for struggling farmers.
Many of these same farmers supported Ronald Reagan in the last election and now he is turning his back on them if he vetoes this bill.
Senator Tom Harkin: They needed a champion. They needed somebody out there on the front lines for them, fighting for them and letting them know that their pleas were being heard. I wasn't alone in that. I mean, there were other Congressmen and Senators obviously who pitched in. But I just felt that this was hurting our Iowa farmers, good solid farm families were being hurt and a whole new generation of young farmers were being decimated by this.
Meanwhile, two popular films, Country and The River, drew the eyes of America to the plight of the nation's farm families. Soon, Hollywood stars testified before Congress.
Jessica Lange: The boundaries which describe their work, their land, their family and their faith in this country and their faith in God, these people are living in a kind of modern day slavery.
Sissy Spacek: I'd be naive to assume that this is a simple problem with simple answers but one thing I'm sure of, we can't turn our backs on these people who have fed us so abundantly and so cheaply throughout our history.
Chuck Hassebrook: I was just remarkable the national attention on agricultural issues at that time that you don’t see anything like that today. All the major papers had agricultural reporters, including the Washington Post, the Des Moines Register had a big Washington bureau. There was just an incredible amount of tension and attention to these issues because of the crisis.
The Cornflakes man, you're on sir.
Don't complain about the farmer when you have a full stomach. This sold this week in Cedar Rapids for $1.19 on special. The farmer got less than five cents for the amount in the $1.19 box.
Rural concern hotline, this is Lori.
Crisis hotlines began to appear nationwide, referring callers to available financial, legal and counseling services. Faith-based groups, university extension workers, lawyers, financial consultants and mental health personnel also stepped in to help.
Joan Blundall: We were seeing more farm women taking jobs off the farm. We were seeing more kids taking on even more of the farm chores. Some thirteen and fourteen years olds really acting as though they were raising the 600 pigs because their fathers were becoming long distance truckers. We saw pastors becoming concerned about divisions in the congregation. How do you preach to a banker and the farmer who is being foreclosed upon with the same sermon? How do you get anybody to talk to you?
Reverend Ed Kail: One angle was just material help. There were folks that needed food, they needed clothing, that kind of thing. So church folks do that, we organize that. But then it's the more intangible kind of stuff that was important and one of that was to be a reminder of values and when people are under stress they can fixate on surface issues and forget the things that really matter. And the biggest one was the farm and the family. And to remind folks that people and land come and go but family, in some sense, is forever, you know. That regardless of where you live, what you're doing, what land you've got, your family is the enduring part, the important part. Tend to your family.
Farmers needed all kinds of support, including mediation services and financial counseling. If you could, you restructured your debt.
Bob Lewis: Most of the time when they came to me the finances were secondary. The indecision was the main thing. They didn't really know what they wanted to do. You know, do we liquidate? Our age has a lot to do with it. The family members. What do we do? And so I wanted to get to a resolution that they felt comfortable with and sometimes that outcome was that they needed to get out and several of them did that because it just wasn't practical. And there was really no way that it was ever going to be resolved. They didn't always do that when I thought that they should. You know, some of them were bound and determined to work on the farm and get it paid off regardless of how many years it took. And there was no room for error. I mean, if they had a bad year they were going to be done.
Wendell Tuttle: Hung in there for many, many years before I finally had to give it up.
Going once, going twice --
In February 1985, creditors foreclosed on Wendell Tuttle's farm. After the sheriff's sale, they had a year to redeem their land. But with a poor crop and insufficient cash flow the banks would not loan them any more money. So the family had a sale and their livestock and machinery were auctioned to the highest bidder. The Tuttles had hoped to sell their farm to one of their sons when they retired. But that was no longer an option.
Wendell Tuttle: Max moved into town, got a job and that was at John Hancock insurance company. We were supposed to give Max the opportunity to buy the house and a little acreage but they didn't do it.
They're not only taking away my parent's right to life, liberty and the pursuit of happiness, I have kids standing down here. Someday they wanted to be a farmer. Everyone of these kids, they've taken from all of us, from all of you!
Protests were staged to hinder sheriff's sales and auctions of foreclosed farms. In some cases, farmers became activists helping others face the loss of their farmsteads, farmers like Bob and Theresa Sullivan.
Theresa Sullivan: But we were there to support those people, you know, people need support. People need support when they're hurting.
We have been to many foreclosures and to many sheriff's sales and we have seen human dignity taken away from people, just destroyed.
Bob Sullivan: We were some of the first ones to go and our bank was the first one maybe in the state. So we got invited to quite a few places, what do you do when your bank closes, something, you know, go to different towns and they'd invite us to come and talk to them. And, you know, people wanted to know, how do you handle it or what can you do? So we didn't have an answer, we just said here's what we experienced and here's what we think together we might be able to do.
Frank Cordaro: When we did do a demonstration, we had a number of them, I was always impressed with the empowerment it gave to people, a sense of, you know, we did something, we didn’t just lay down and take it. And it was always fun to experience that with people, lift them up. And I call those redemptive moments, catharsis moments. The people I worked with, even though they were losing, felt good that they were finally putting out there their side of the story, their truth.
Out of the crisis, a new generation of religious, labor and political leaders had grown to give voice and direction to the rural insurgency. By 1985, half the counties in Iowa had some form of grassroots effort to address the crisis.
In reality we know this is the worst point of this depression, farm depression in this country and it's the worst depression for 50 years.
Governor, upon how well you listen to our people and respond will decide on how or whether people are going to live or die.
And we're here to say to that system that we're not going to stand back and take it quietly anymore, the kinds of actions that you're taking on our people and we're going to fight back.
Hundreds of these crosses have already been planted in the fertile soil of the Heartland of America to mark the loss of family farms. Today, just an hour or two ago, 250 of these crosses were planted in Lafayette Park just across the street from the White House because that is the number of farms that are going bankrupt each day.
Willie Nelson: -- waiting to get on the road again. On the road again, going places that I've never been.
One of the most well-known national organizations was Farm Aid founded by singer Willie Nelson.
Willie Nelson: I had heard some rumors in Texas about some of the farmers and ranchers having a rough time and I asked some of my friends around who were ranchers and farmers and they said, well it's really bad in the Midwest, it hadn't really got that bad here yet but it's on the way. So we started talking about what we might do and call some attention to it and see if we could help the situation in some way. And so we did.
(music) He said, I worked hard on this land as a boy and as a man and I'll lose it now to no damn bureaucrat.
The first Farm Aid concert was held in Champaign, Illinois in September of 1985. 54 acts performed before a crowd of 78,000 and millions of dollars were raised for farm families.
Willie Nelson: I was glad we were there. I was glad that we were there to give them a voice. We had a press conference. We had a lot of people on the stage. We had a whole lot of farmers, people and press everywhere and people all over the place would get up and say what they thought about the situation. This farmer or this farmer or this lady so it was one of the best things that happened as far as I was concerned to get us all together talking about it and I knew we were onto something and I knew if we could give these farmers a voice then that would help them and that’s what we've been trying to do.
The national tractorcades to Washington, D.C. in 1979 and 1980 are among the best remembered6 expressions of discontent in the Heartland. Led by the American Agriculture Movement or AAM, the protests were some of the earliest signs of distress in farm country.
David Sentor: We were pushing for higher price supports or higher prices for our commodities. You know, you can't produce and sell at less than the cost of production and survive. And so farmers were just looking for a fair shake.
But these actions and others like them did not necessarily represent the experience of most farmers. Studies suggest that less than two percent of Midwestern farmers actually took part in public protest during the 1980s and that fewer than one in a hundred joined political action groups. Most farmers, both men and women, were silent, battling the crisis alone.
December 6, 1984 -- I feel a hundred years old. Fourteen years of farming and we never made a dime. I'm 44 years old and I'm back to zero. I'm ready to sell out. I hate to lose my homeplace, but I can accept defeat when I have to. I could mourn forever all the lost dreams. I don't sleep well and the rage in me is about to explode. I just can't go on. I have to hide my feelings from the kids, from the folks.
Kaye Hagedorn: Well, I had always been taught that you didn't talk about finances, that or politics or church were kind of forbidden topics. So I might crab about the prices or about having to borrow money or something like that but no, you really didn't confide about the troubles that you were having. And we didn't feel that we could turn to Dean's parents either because in the first place his dad at this point had passed away and his mom's health was kind of fragile and she just depended on him so much. So there wasn't any place to turn.
Paul Lasley: And how tragic it is, proud people, hardworking are caught in the vortex of these global and international forces that they can't control. And the level of hurt that you could see in their eyes, proud people and often times very stoic and not showing emotions. So the bigger sweep was the level of despair, the sense of loss.
For some, the stresses of the farm crisis became too much to bear.
Mike Rossman: The incidence of suicide increased during the farm crisis of the 80s to about four times the average rate for farm people at that time.
Gary Lamb: I helped bury three neighbors that committed suicide after the banks foreclosed on them.
After a virus destroyed their hog operation, Phil and Norma Fetter had to borrow more money from the Federal Land Bank to keep the farm afloat. When the markets fell and interest rates skyrocketed, they were unable to keep up with loan payments. Worry and stress dominated their lives. It became too much for Phil.
Norma Fetter: We decided we would go for help so I had called Sedlacek Center in Cedar Rapids, St. Luke's Hospital and was going to take him down on Sunday morning. Got up Sunday morning and it was very hot, July 25th, I think it was 100 degrees, 7:00 in the morning it was very hot. And I had kind of packed a bag for him to take, his shaving gear and whatever so he couldn't find his shaving gear when we got ready for church and with small ones at home we took turns some going to one mass and some going to the other mass. Anyway, so we got ready and went to church. And when we came home the little one, Joe, was five years old, he said that daddy was out in the barn and he was out in the machine shed with a rifle. That's how we found him when we came home from church. So a couple of the neighbors came in and tried to talk to him, I tried to talk to him, told him that his brother was on his way down. And he kept saying things like, mom would be so disappointed in me and all of this. And I said, why don't we go out and sit under a shade tree until your brother comes or go to the cemetery and go up and talk to your mom, whatever. He couldn't hear anything. He was just, his mind was just too far gone. He just couldn't grasp anything anymore. And finally, I did stand back, otherwise, I could have been gone too.
Like Norma Fetter, Karen Heidman and her children faced the devastation that suicide brings to a family. Her first husband, Daniel Cutler, couldn't take the stress of the deteriorating economic conditions.
Karen Heidman: The children and I returned home from school on April 2nd and Dan was not home but we weren't alarmed because he had said that he was going to go to Monona County to visit family. But when he didn't return for dinner or all that night then we were really scared and I notified his family, they spent all night looking for him. I was on the phone with his psychiatrist several times that night. I told his friends the next morning and they notified authorities and by that afternoon the BCI had found his body in an abandoned farmstead north of Sioux City. I personally think maybe that was symbolic, also an abandoned farmstead and abandoned dreams. He had a note in his shirt pocket that indicated where a suicide note could be found and the first, the opening statement of the suicide note was, the farm killed me. I think it was a perfect storm of circumstances. This was the first serious impediment to a goal that he had ever experienced. It was shame that intelligence and determination and a magnetic personality were not going to be equal to overpowering market forces. It was continuous bad news on the TV and radio about the farm economy, shame for the financial circumstances of the family that he thought were his fault, shame of the stigma of mental illness and the loss of a dream.
Some reacted to the tumultuous times by turning their rage on others. Dale Burr, a 63 year old farmer from Lone Tree, Iowa, found himself more than a half million dollars in debt. On December 9, 1985, he went on a violent rampage first killing his wife Emily, next Bank President John Hughes at the Hills Bank and Trust Company and then nearby farmer Richard Goody. After the horrific murders, he shot himself. At Burr's farm house, police found a note alongside Emily's body. It said, he couldn't manage his problems anymore.
Alan Tubbs: Emotions were high at that time certainly and the peak of that was manifested at Hills Bank when John Hughes was shot by a disgruntled producer. And that put everybody on edge. And that I think just demonstrates the high level of emotions that were involved. It was such that, I have two sons, they were in their high school years during that time and I did not encourage them to come back to the bank.
Reverend Ed Kail: It was a time of spiritual crisis, really, as much as anything and for me personally as a pastor it was. The whole community was in depression and so that loss and moving into depression, about 1985, gosh, the mood was just dark.
The murders and suicides pointed to the hardships facing many. The feeling of camaraderie long prevalent in rural communities was often damaged beyond repair. Moreover, some of those who were struggling reported feeling shunned by their friends and neighbors.
Joan Blundall: People who I had sat with in church didn't come to church anymore. And it was foolish of me but I thought, well, we'll just knock on the door and see what is happening. And the farmer did not want to speak to me. I came back again, didn't want to speak to me, came back again. This was a man who used to drive me to church. And he said, don't you know we just can't go anymore. And he was the first farmer I spoke to who was about to lose the century farm.
Bob Lewis: I heard often times that they were thought of or people were thought of that were having financial problems as poor managers. Quite frankly I didn't see that so much. I saw people that were victims of circumstances that were beyond their control. I had a family that they both had off farm jobs and good insurance and farming several hundred acres and they both got laid off within a month of each other from their jobs so they lost their insurance and within two months after their insurance was gone their daughter was diagnosed with a brain tumor.
Theresa Sullivan: I remember going to church, going to mass and I just felt, I just felt creepy. I thought people were, all they were doing was criticizing us, I just felt creepy up and down my spine. But after mass there was a neighbor lady came to me and she put her arms around me and she said, it's alright Theresa, we like you, you are good people. And that meant a lot.
Reverend Ed Kail: You had the folks who were well positioned further along in their life cycle blaming the younger folks and how to call them to some kind of understanding and compassion apart from the grace of ten, fifteen years it could be you.
The family structure suffered. Farm men put up walls of silence, isolation and denial. Farm women often had to take on more responsibility regarding the farming operation. Alcohol abuse and domestic violence became more common.
Gary Lamb: I was at a court hearing once for a farmer and he said something I didn't think I'd ever hear. He told a judge, he said, you can take my wife, you can take my kids -- and there was tears rolling down his face -- but he said, don't take my farm. And I thought, my God, think of the kind of pressure that was on this guy. He's willing to sacrifice his family just to keep his farm. There was something there that people like you and I would never understand, see, because we haven't been in that position that we're ready to lose the farm. And to some of them that meant more than the family and it's unfortunate, it doesn't make sense but that was the reality of it.
Reality hit Bob and Theresa Sullivan when they filed for Chapter 11 bankruptcy and had a sheriff's sale in the early 1980s. One of Theresa's brothers bought the homeplace allowing Bob and Theresa to stay there until retirement.
Bob Sullivan: Even in the bankruptcy we were, by law we were entitled to 40 acres so they come out and measured off 40 acres but there was no way to make a living off of 40 acres and all the buildings so we learned to be poor that way. We're getting by and we're just still poor folks but we're okay.
Today, four of the Sullivans' sons farm full time.
Kaye Hagedorn: For me I dragged my feet. I could not pack, I could not get ready. I postponed it and postponed it and postponed it.
The Hagedorn family decided on a different path when they filed for bankruptcy. Their home had been in the family for generations but they knew if they tried to hold onto it they might lose all of their land. The bank took it back for secured debt, leaving the homeplace wasn't easy.
Kaye Hagedorn: Finally, Dean got all his buddies to come and they came into my home and they moved me out in two hours, lock stock and barrel and into a rental property in town. Took us six months to find his ties. They were in the electric frying pan, not where anybody would normally look for them. Emotionally it was really traumatic. That night as we lay sleeping in our new house I woke up in the middle of the night and I felt like I was almost in an altered universe because the moon rise was on the wrong side of the room and for just a moment I didn't know where I was. Dean, there's a picture of him that I'll never forget, it was on the cover of I think the Des Moines Register and it's just heart wrenching. I can't look at it to this day. He was really sad. He had been raised there. That was his home from the time he was a little boy. So it had a different meaning for him than it did for me. I loved the place. It was my heart's home and I'll get teary. But I didn't have the burden of unmet expectations of disappointing family and friends. That has got to be really burdensome.
Dean Hagedorn: That was devastating for me. The day we moved to Spencer and moved to a rental house is the day that I'll never, I don't want to relive. We were out of there and into the new place in a matter of one day. But it was something that I couldn't delay, it was something I couldn't spend two weeks doing. I had to get it done and out here and over with and gone. That was what had to happen and for me it had to happen quickly and be done and move on and go from there. But when the trucks were all gone, Kaye and the kids were gone, and the house was totally empty and I was sitting in there, it was a time I won't forget. I felt, those feelings of failing.
(music) All the lightning bugs took cover underneath the leaves of corn. I sat on the front porch like always riding out the storm. Maybe you're deep in some dream right now that would leave you feeling safe and warm. It's a far cry from freedom but it kind of feels like being reborn. And you shed your skin like a king snake out in an Iowa field. Washing your hands in the porcelain basin, your plan was to finally heal. You weren't prepared to be taken by storm or set so far back on your heels. But that's alright, this too shall pass, no matter how bad it feels.
December 7, 1985 -- Our net worth in two years has dropped from 34 percent to minus zero. Incredible! We are stone cold broke!
Farmers were not the only ones hurting. The economic impact of the farm crisis rippled throughout the Midwest. The Farm Credit system faced its own collapse and eventually would be bailed out by the government. And rural bankers found themselves in unenviable positions.
Alan Tubbs: The first major impact on my mind from the 80s is the emotional stress that it caused for lenders as well as producers and the wedges that it could drive within communities that were really in large part not of their own making.
Tom Huston: I knew most of the bankers in the state of Iowa. Most of them knew me. I had been in many of their towns. I kind of made it a job to see to it that I knew where they were, what their town looked like, what their bank was. I tried to understand what was happening there in that town. And so when I had to go there I would be closing a bank on people that I considered as friends. And I knew the heartache that was going to come in that community.
The banks started closing and untold millions were lost. The scope of the crisis grew rapidly.
Neil Harl: Once something affects the financial side it has huge consequences. We lost 38 banks in the state of Iowa during that time period. This was all very destabilizing, destabilizing to everyone, even those who had good credit after their bank failed, they had trouble finding a new banking home because no one really wanted to take on an agriculture client.
The farm crisis decimated small towns where many businesses closed. It spread into the cities where manufacturers of farm implements and other agricultural supplies laid off thousands. In 1984 the Caterpillar
Tractor Company plant in Burlington, Iowa closed. The Quad Cities in eastern Iowa and western Illinois lost an estimated 20,000 manufacturing jobs during this time. As demand plummeted, John Deere, the largest farm implement manufacturer in the region, laid off workers by the thousands. Waterloo, Iowa lost 14 percent of its population in the early 1980s and scores of homes were left abandoned.
Senator Charles Grassley: It devastated the economies of those cities which were so dependent upon agriculture because of agricultural machinery. If agriculture is not making money it's devastating.
Rural businesses were affected as farm families had little money to spend. It is estimated that for every four farms that went under one rural business closed.
Alan Tubbs: The farm crisis had a major impact on what happened in our downtowns. We had consolidation of farm equipment dealerships. We had feed stores that consolidated, retail stores downtown that changed. And so you see in many rural communities vacant store buildings and so forth because shopping patterns have changed. Now that's not just all from the crisis here. Some of that was going to happen anyway. But there was a lot of encouragement of that during those difficult years when agriculture didn't have the income to spend in their rural communities.
By the time Congress got involved in the mid to late 1980s many felt it was too little too late. By then the damage was largely done. Still, Washington's response brought about some of the most profound policy reforms the agricultural sector had ever seen.
John Block: I was absolutely in tune with President Reagan's agenda and he wanted less government and less taxes and I supported that and I was willing to make cuts in farm programs sometimes, in food programs.
President Ronald Reagan: We're doing a great deal to help farmers but I have pleaded and warned repeatedly that just as your families don't have a blank check for whatever your needs may be neither can government, and that means taxpayers, bail out every farmer hopelessly in debt or every bank which made imprudent or speculative loans and bet on higher inflation.
Senator Tom Daschle: So you had a philosophical chasm really between those who believed the government's role should be limited if not completely non-existent and those who really felt that at times like this you needed the government to create the kind of stability and the kind of certainty and the kind of framework necessary for survival. That clash occurred in public policy debates for months and months.
Some key pieces of legislation from the 1980s included the Food Security Act, more commonly known as the 1985 Farm Bill. It allowed for lower commodity price income supports and created several conservation programs. Then in 1986, Congress introduced Chapter 12 Bankruptcy.
Senator Charles Grassley: For the same reason that if you had to have a special law for farm bankruptcies in the 1930s I thought it was legitimate to have a special law for farm bankruptcies during the 1980s. And I think it did serve and now it is a permanent part of the tax code.
And in 1987 the Agriculture Credit Act authorized a $4 billion financial assistance package for financially vulnerable institutions of the Farm Credit System.
Senator Tom Harkin: Basically what we did, it's simple, simple language. As we said to the farmers with all this debt and they were paying these high interest rates leftover from the early 80s and the late 70s, come in, we're going to restructure it, we'll buy back your loans, those debts, we'll stretch it out over 20 years and we'll give you a lower interest rate. Basically that's what happened, we just restructured all those loans. And then we gave the Farm Credit System enough money to be able to do that. And that stopped the bleeding. Of course by that time a lot of people said it was too late for them because a lot of them had already been thrown out of agriculture. So we did lose a lot. I wish we could have done it earlier. But the forces just weren't all lined up to do that.
While President Ronald Reagan said he wanted to bring a market oriented approach to farm policy, his administration ended up expanding federal involvement in American agriculture. In fact, Reagan's farm programs cost more than the combined farm expenditures of every president from Franklin Roosevelt to Jimmy Carter.
The 1970s often are viewed as a decade of misplaced expectations. Who can blame lenders for putting their money to work in such productive ways? And who can blame farmers for trying to become more competitive? Yet the sad truth is that agriculture, like any endeavor, will always have some who fail. And their numbers were magnified during the farm crisis.
Mark Pearson: There were periods in the 80s where nothing worked. I mean, if it was cattle they weren't making any money. The hogs weren't making any money. Hogs were disastrously low in 1980. Wheat, corn and beans were disastrously low in the marketplace. Everything at some points weren't working, everything that we produced was at a loss. You can't do that for very long.
Paul Lasley: And I think that was one of the problems we had in the 1980s is we were slow to respond because of resistance that some of these people deserved to fail because after all they were, they were high rollers, they were land hogs, they were big wheels, they got too big for their britches. I've heard all of those stories and indeed there was some of that. But for the vast majority of people they were just like you and I, they were trying to make a living, they did the best, made the best decisions they could based on the advice they got.
The farm crisis of the 1980s accelerated a long established trend of farmers leaving the land and farms being consolidated. In 1935 the number of farms in the U.S. reached an all-time high of 6.8 million. By 1990 there were only 2.1 million farms.
Mike Rossman: There has been a rapid increase in the number of acres operated by a single farm enterprise. That trend toward very large farms was initiated during the 1980s and it continues unabated up to the present day. Now, there is a concurrent, ongoing trend also for the development of small family farming enterprises, mostly organic, that is producing many new farm people. So we would probably not have these changes had not the farm crisis of the 80s ushered in some of the shifts in the demographics of farming.
Nearly 30 years have passed since the 1980s farm crisis. Most farmers who struggled and survived those tumultuous times remember the decade as a nightmare from which they could not awaken. After Phil Fetter took his life, his widow Norma was left to care for 10 children on her own. And she was left to deal with overwhelming debt. A brother-in-law stepped in to help. But eventually the farm and house were sold back to the Federal Land Bank at a substantial loss.
Norma Fetter: Well basically we had no place to go. Didn't know what I was going to do. I had been able to stay at home for most of the 25 years we'd been married, we raised the kids, be a farm wife. Went to work that winter first time I had ever worked out of the home. I had two or three different jobs, whatever, just to keep things together. Just you get up every day and you do what you have to do. I think that's basically what it amounted to.
We must reach out, join hands and bring back --
Gary Lamb avoided serious financial trouble and he devoted much of his time to advocating for farmers who were suffering. But while his farm was intact and solvent the operation just wasn't big enough to include one of his sons.
Gary Lamb: We wanted to pass our heritage and farm onto our sons or our daughters and my youngest son was the one that really had an interest in farming. He followed me around and asked questions about crop and livestock. And when he graduated from Iowa State in 1984, there was a feeling of pride, you know, when he was getting his diploma. And yet there was a feeling of sadness too because I realized he isn't coming back to the farm. And I think I'm over that.
We bought first, bought this in '63, bought that in '65.
After the foreclosure on his farm, Wendell Tuttle continued to sell insurance but never returned to farming. His son, Max, works for a producer today. Tuttle says the support of his wife Leota and their kids helped him get through tough decisions. But the wounds of the 80s farm crisis remained fresh.
Wendell Tuttle: It's just like pulling their heart out because I had bought that farm and made a commitment to leave it better than I found it and I was not able to do that and that hurts.
Despite what the faced during the farm crisis, the Hagedorn's insisted on paying their debt.
Dean Hagedorn: The thing was that I did not want to walk away from all these unsecured creditors and say, too bad about you. I owed them this money and I wanted to pay them and we did.
Kaye Hagedorn: We were able to work through those things and make what we felt were good, responsible decisions that represented who we are as human beings, that allowed us to not hurt others in our attempts to survive ourselves.
Kristin Hagedorn: Because we weathered it. I think that, you know, my mom and dad are financially doing fine. And they have, they're still married and they're in a committed, happy relationship and they're living a life that is bringing them great job and my sister and brother and I are married and have kids and doing well and I think that, that is a success sort of, you know.
Dean Hagedorn: Life is good.
David Peterson: I saw a slogan towards the end of my shooting experience back in '86 that stuck with me. It was a sign, I can't remember where I saw it, it was out in some rural area. It said, tough times don't last, tough people do! And that is kind of what stuck with me about the people that I covered and the trauma that they went through but yet many of them came through okay and many of their children came through okay. So I guess that's the message.
Some wondered if the lessons of the nation's farm crisis might too soon be forgotten.
Karen Heidman: We never learn our lessons. We don't. We always think that our situation is unique and that this can't happen again, things will be different this time. So, no, the lesson to be learned is we never learn.
Chuck Hassebrook: When anybody tells you that we've reached a new plateau of profitability in agriculture and that land prices are never going to go down again, don't believe them. And we're starting to hear that again today and whenever I hear that I assume the end, the crash is coming pretty close when people start saying that. So one never believes that. It seems like every generation has to relearn lessons and the lesson, frankly the lessons we learned in the 80s farm crisis, had they been heeded more widely, could have, would have presented housing, the meltdown in housing that has taken our whole economy down in the early part of this century. And so it seems, you know there's an old saying that a financial genius is someone in good times with a short memory and in good times there are a lot of people with short memories and we can't afford to have that kind of short memory in agriculture in this good time for farming.
So what do current conditions mean for today's farmers? Some experts say farmers are much less leveraged. And as fate would have it, agriculture helped lead the nation back from the economic abyss during the latest recovery as farm exports, commodity prices and net farm income all soared to record highs. Rural land values also have climbed to unprecedented levels in recent years, fueling talk of bubbles and prompting some to wonder if history will repeat itself.
Neil Harl: We don't know whether it may occur in 2020, 2030, 2040 or earlier. But it's likely to happen again when people forget the lessons learned in the 1980s. Now, right now, agriculture is doing very well. But I do urge everyone in the agriculture sector to think twice and to run in their business plans a worst case scenario, not just a best case scenario.
Kristin Hagedorn: And I think that particularly when you're dealing with situations like this it isn't just somebody losing their job or losing a business, this was a whole, it was whole families that were involved and it was, you know, generations of families that were involved. And I think that's important not to lose sight of.
Mark Pearson: You can't borrow your way to prosperity. The markets are going to change. And you have to be diversified. You have to be able to have, you have to have cash but you need to keep debt low and not high and not overleveraged and I think that has been the big lesson of the 1980s. What we need to have on an ongoing basis is an ability to compete in the world. If you give the American farmer the chance to compete in the world he'll take on everybody.
Farming is cyclical and often unpredictable. Ask any farmer, big or small, about their job and they will talk of flooding and drought, rising costs and fickle markets. Yet most farmers love what they do. For them, agriculture is a virtuous gamble where the odds of a bountiful harvest get better the harder they work.
2013 - My farm was saved during the farm crisis of the 1980s because of the support of my parents and my own commitment to keeping it in the family. Ironically, the farm had become the property of my family during the Great Depression of the 1930s. My grandfather loaned money to the buyer of the farm. But when the man was unable to repay his loans he was forced to relinquish the land to my grandfather. In 1936 he and my grandmother gave the farm to my folks as a wedding present. The farm is now debt free and in a trust for my three children, the third generation of the family to own it.
This project is funded by Humanities Iowa and the National Endowment for the Humanities. The views in this program do not necessarily reflect those of Humanities Iowa or the National Endowment for the Humanities. By Farmers Mutual Hail Insurance Company of Iowa which has proudly supported Midwest farmers for 120 years with consistent service and financial protection. By John and Carole Lea Cotton, in appreciation and respect for the farm families of Iowa, both past and present. And by Tim and Wendy Haight, believing in the importance of preserving the history of Iowa's family farmers.