A predatory and extractive financial sector has hollowed out communities across the US.
February 18, 2020
Losing ground: US farm output has more than doubled since the 1850s, but farmers like Ray Martinmaas in Orient, South Dakota, aren’t benefiting. (Ricky Carioti / The Washington Post via Getty Images)
Last June, The Washington Post published an article featuring Ray Martinmaas, a farmer in Orient, South Dakota. He said family farmers were losing out in the trade fight with China and weren’t benefiting enough from $14.5 billion in recently promised direct federal aid. He and his wife, Becky Martinmaas, the article read, “share a commitment to hard work and family, a love of sport shooting and hunting, and a distaste for coastal elites.” He voted for Donald Trump but now wasn’t so sure. “We’re the ones taking the brunt of it in all these negotiations,” he said, “so they need to be kind of helping us out.”1
In the comments, Ray Martinmaas got hammered. Many were furious he voted for Trump, but others said farmers were welfare queens who “disdain the coastal elites who pay their bills,” as one put it. “The sheer ignorance of thinking they feed us. When it’s us feeding them.” Another anonymous commenter put it more darkly, writing, “The flyover Red States farmers and ranchers [must] pay for their self-centered decades of whining and begging.”2
Such remarks reflect two popular narratives about agriculture. The first is that the (not always coastal) big money centers like New York and Chicago and the billionaires who work there are the real wealth creators, showering jobs and handouts on grasping Midwestern farmers. The second holds that the decline of many small farming communities is a result of the inevitable march of progress—tractors and machines replacing farm labor and other long-term trends. To save dying rural communities, this story goes, we’d need to return to a bucolic past of pitchforks and plow horses. “What we see, obviously, is economies of scale having happened in America,” Agriculture Secretary Sonny Perdue said approvingly last October. “Big get bigger, and small go out.”3
Yet both the narrative that subsidies flow from “coastal elites” to farmers and the fatalism about rural economic decline indicate a profound misunderstanding of what’s actually going on. Farmers have as much reason to be angry, if not more, because of the larger, less visible financial flows heading in the other direction, sucked out of their pockets and funneled to the big money centers, often into offshore tax havens. This is part of a broader phenomenon affecting the entire economy, which I call the finance curse. The good news is that this can be decisively reversed without turning the clock back on progress—and with transformative economic and political results. MORE