Farming as a Business
Stewart, Robert
FARMING AS A BUSINESS By ROBERT STEWART THERE is probably no field of thought where there is so much loose and unsound thinking as in agricultural economics, yet there is no field where accurate...
...The tools used were crude and the farming was so poorly done that the farm produced little more than why the family consumed...
...The twelve farmers who were cultivating farms larger than four hundred acres were making over six thousand dollars a year...
...This idea that the small farm unit is fundamentally vital to the welfare of our national security is widely accepted as true...
...This does not necessarily mean that the big bonanza farms of the past in the far West will be revived, but the evidence does seem clear that there are still too many small farms and that they should slowly be merged into larger units for more economic production...
...There was no time for school, travel or reading...
...The mergers of small farms into larger units must continue to take place if business success in agriculture is to be generally expected...
...The larger farm units make for more economic production and can secure modern, up-to-date equipment, which the small farmer cannot do...
...now it is distinctly a commercialized industry...
...Two-thirds, of the farmers were making less than fifteen hundred dollars a year and were cultivating farms less than one hundred and sixty acres in size...
...The costs of production are thus distinctly lower on the larger farm unit...
...Farm* ing at present is more than a mere "mode of living," as it was of course in pioneer days...
...This made it possible for one-half of the population (now1 three-fourths) to do other kinds of work...
...The changes in farming methods are being brought about by the operation of certain fundamental economic forces, and are irresistibly influencing the lives of many millions of human beings...
...And, as a matter of fact, mergers of small farms into large ones are rapidly taking place...
...All who have studied the problems of farming are agreed that mergers of small farm units into cooperatives and pools for the distribution of farm products is not only sound and desirable but inevitable...
...It is important that all realize the situation confronting the farmer, and that there be a clear conception regarding the far-reaching fundamental changes through which agriculture is now passing, if a sane solution of the farm problem is to be achieved...
...tricts in the corn belt of Indiana, Illinois and Iowa...
...According to the United States Census, during the decade 1910-1920 the number of farms under twenty acres in size decreased by 42,573, while the number of farms over five hundred acres in size increased 25 percent...
...Yet in an age of successful industrial combination, how can the small farm unit hope to succeed as a business proposition...
...President Hoover, for example, in his acceptance speech, said: "Farming is and must continue to be an individualistic business of small units and independent ownership...
...It is futile to organize mergers for the distribution of farm products if these latter have been produced at such a high cost-as they must be on the small unit-as to prevent their profitable sale at any price the consumer can afford to pay...
...The conception that the ideal farming system is one based upon the foundation of the small land-owning operator, and that centralization is not only impractical but highly undesirable, is deeply rooted in this country...
...Over 90 percent of the population lived on farms...
...But there are still too many farmers...
...Now that farming has become commercialized, it is clear that it must follow the lead of successful industry elsewhere...
...And if civilization is to progress, there must still be a continued movement away from the farm and toward the city...
...There are still too many farmers in the country, and the small farmer is trying to accomplish the impossible in his attempt to make a business success of a small industrial unit...
...Moreover, the larger farm units, in harmony with industrial experience everywhere, are distinctly the more successful...
...As is the case in all revolutions, there has been marked distress and much real suffering among those most vitally affected by the radical changes taking place...
...With the introduction of machinery and better methods, a one-farm family produced as much as two families could consume...
...Unless that becomes prosperous, our boasted industrial welfare will prove, in the long run, to be a tragic illusion...
...The larger the merger the more successful the industry, seems to be the rule...
...The influence of the size of the farm business upon the farmer's income was clearly demonstrated...
...The organization of agriculture into larger units must not be by enlarged farms...
...FARMING AS A BUSINESS By ROBERT STEWART THERE is probably no field of thought where there is so much loose and unsound thinking as in agricultural economics, yet there is no field where accurate thinking, talking and writing are so urgently needed at the present moment...
...In the early life of this country, when it was primarily an agricultural country, the small self-sufficing farm was a vital thing...
...The other third were cultivating farms larger than one hundred and sixty acres, and were making from nineteen hundred to six thousand dollars a year...
...There are almost daily mergers of newspapers, charities, hospitals and clubs...
...Let us consider some of the most important of these changes and their effect on agriculture^ In the days of our forefathers, the entire family worked on the farm...
...Competition here has become so keen that only those producers and distributors can succeed who have reduced their costs by the elimination of all waste...
...The growth of the chain-store system, for example, is one of the outstanding developments which the past decade has witnessed...
...The farmer became a purchaser of manufactured articles, thus creating a new market for the products of the city...
...And this problem must be solved, since the continued prosperity of the country as a whole is contingent on the prosperity of its agriculture...
...In the industrial field the tendency to mergers is supreme...
...But is it necessarily true, as President Hoover affirms in the speech referred to above that "if the farmer's position is to be improved by larger operations it must be done, not on the farm, but in the field of distribution...
...Recently the United States Department of Agricuk ture made a survey in representative agricultural dis...
...This is the day of the merger in all lines of endeavor...
...As in the industrial world, the larger productive units were distinctly more successful...
...The condition of agriculture is of vital concern, not alone to the farmer, but equally also to the banker and manufacturer, the laboring and professional man...
...The first step in the successful merchandizing of any commodity is economic production...
...The revolution now taking place as regards management, size of the farm business, efficiency in production, elimination of the marginal operator, changes in methods of financing and marketing, is as momentous in the field of agriculture as are similar changes which have occurred and are occurring in other lines of industry, yet there is a paucity of real information regarding these most important influences upon our most basic industry...
...The larger unit can secure financial aid more easily...
Vol. 11 • January 1930 • No. 10
