Farmers earning dramatically less of U.S. consumer food dollars

Relative to our discussions recently about dairy farms is this chart showing the decline in food-dollar share going to farmers since 1950.

As Daily Yonder points out, some of the decline is due to the increase the amount of money people now spend eating out rather than at home. While eating out doesn't mean farmers make less, per se, it does mean the overall amount of dollars spent on food has increased, with a good portion going to the mark-up of restaurants.  (Sadly for social capital, much of the increase has gone to fast-food chains, where people are generally less social than in the corner diner.)

Now, there has been some relief for consumers recently, with grocery prices dropping as much as 25 percent on some items, but that doesn't necessarily spell relief for farmers.

There are numerous problems facing farmers, from the rise of conglomerate buyers (decreased competition) to price discovery structures that may not fit with modern technology and communication.

Still, this chart backs up something Steve Hawley told me two days ago: Farmers he knows are getting the same price for their products that he got when he was a hog- and cash-crop farmer 30 years ago.

Meanwhile, all of the costs associated with running a farm has continued to go up, from labor to fuel and fertilizer and insurance.

Farmers are in a tough spot and now we have China threatening a trade war over chickens and tires.

A lot of these problems seem inter-related, from high government spending driving up taxes, to the purpose of anti-trust law being turned from its original intent, which was to ensure small-business competition. The law has morphed into ensuring that consumers get the cheapest price at Wal-Mart, thus fueling the rise of conglomerates and pushing U.S. jobs overseas in search of super-cheap labor.

This isn't a problem the government can necessarily fix for us. Consumers need to be smarter about how they flex their purchasing power, spending more money with locally owned businesses and avoiding big-box conglomerate retailers as much as possible.

Especially, buy locally produced food as much as possible.