Monday, December 31, 2012

Africa and aid...  

My monitoring of African news uncovered this interesting debate in the German magazine Der Spiegel. (James Shikwati is a Kenyan economics expert)
SPIEGEL: Do you have an explanation for this paradox?
This opinion parallels the argument made by GiveDirectly and several other economists. It also rings true to me with my meager grasp of sub-Saharan economic development and history. But if we have learned nothing else in the last few years is policy is not about data or logic.
To my surprise...  

The estate tax is a center-front issue in the fiscal cliff talks.
Under the Republican proposal, 3,800 people would pay the estate tax year, also near an average of $3.3 million. The GOP proposal would raise $182 billion for federal tax coffers over the next 10 years.
Under Obama’s proposal, 6,500 people would pay the estate tax next year, with an average payment estimated at about $3 million. The president’s proposal would raise $284 billion in tax revenue over the next 10 years. [More]
While this is all completely fluid, I think it is reasonable to expect the outcome somewhere between these two: $4.5M/35% versus $3.5M/45%, respectively.

In fact, "4 and 40" has kind of an almost Biblical ring to it, no?

Now if the income limit for tax cuts comes in at say $400,000, the chained-CPI phased in over 40 years, and the sequester cuts debate extended for forty days, we could manufacture a miracle that could get even religious-right hardliners on board.

Anybody have Biden's number?

Saturday, December 29, 2012

Africa Trek I...  



Meanwhile, I'll share all the background research I'm doing.

Wednesday, December 26, 2012

Now we're giving somewhere...  

I am intrigued by the new charity effort started by economists, GiveDirectly. It appears to me serious economic and behavioral research is finally being applied to update what have been quite frankly outdated charity operational models.

The effort has received very good reviews.
Three years later, the four economists expanded their private effort into GiveDirectly, a charity that accepts online donations from the public, as well. Ninety-two cents of every dollar donated to GiveDirectly is transferred to poor households through M-PESA, a cell phone banking service with 11,000 agents working in Kenya. GiveDirectly chooses recipients by targeting homes made of mud or thatch, as opposed to more durable materials, such as cement or iron. The typical family participating in the program lives on just 65 nominal cents-per-person-per-day. Four in ten have had a child go at least a full day without food in the last month.
Initial reports from the field are positive. According to Niehaus, GiveDirectly recipients are spending their payments mostly on food and home improvements that can vastly improve quality of life, such as installing a weatherproof tin roof. Some families have invested in profit-bearing businesses, such as chicken-rearing, agriculture, or the vending of clothes, shoes, or charcoal.
More information on GiveDirectly's impact will be available next year, when an NIH-funded evaluation of the organization's work is complete. Yet already, GiveDirectly is receiving rave reviews. In November, it became one of just three charities to earn a coveted recommendation from GiveWell, a web publication that conducts exhaustive, on-site research of philanthropies. This month, Google awarded GiveDirectly a $2.4 million grant to expand beyond Kenya. Facebook cofounder and media wunderkind Chris Hughes joined the group's board in August. Nevertheless, GiveDirectly remains an outlier in the development arena, perhaps the only organization that distributes private donations, made online, directly to the poor with no strings attached--no requirement to launch a business or to immunize one's child; no distribution of bed nets, solar lanterns, or goats.
The economics might be sound. But the politics within the non-profit world are more complicated. Niehaus, now a professor at the University of San Diego, says other development experts who have tested unconditional cash transfers are enthusiastic about the approach. The trouble is convincing NGOs to invest in such programs beyond the pilot stages.
"We had conversations with people [in the non-profit sector] who said there was a lot of internal resistance to unconditional transfers," Niehaus told me. "If this works, what are we all here for? Why do we have jobs? There's an industry that exists that tries to make decisions for poor people and determine what's best for them. In some ways, that's the industry I came from. But the value of that hasn't been proven."[More]
The last paragraph may be the most important - what if technology and extreme inequality are teaming to make many current philanthropy efforts obsolete? This idea will not be viewed kindly in the vast charity industry.

Much of the resistance is also rooted in our desperate clinging to  Just World view: People are poor for a good reason. Otherwise, we would be wealthy for no good reason as well.
More recently, researchers have explored how people react to poverty through the lens of the just world hypothesis. High belief in a just world is associated with blaming the poor, and low belief in a just world is associated with identifying external causes of poverty including world economic systems, war, and exploitation.[26][27] [More
We also struggle to give up the idea that strings should be attached to charity. Whether repentance, sobriety, employment, etc., all such "riders" assume a "just world" for which there is no evidence whatsoever.

Consequently, the early results, and the later ones this year I hope, seem to substantiate more modern economic theories of development. In fact, economists all over are getting excited about the possibilities that were unimagined before cell-phone service in very poor areas of the globe. 

Marginal Revolution's Tyler Cowen, one of the best-read econobloggers on the Net, has worked on similar premise.
My new book Discover Your Inner Economist: Use Incentives to Fall in Love, Survive Your Next Meeting, and Motivate Your Dentist offers a chapter on how to help other people.  In the book I suggest several principles:
1. Cash is often the best form of aid.
2. Give to those who are not expecting it, and,
3. Don’t require the recipients to do anything costly to get the money.
Inequality actually works sort of perversely in our favor for this effort. Our wealth is so much greater than the recipients that even a tiny slice we will barely feel can make enormous quality-of-life changes in lives of absolute poverty.

While it flies in the face of our relatively puritanical fiscal instincts (you can't just hand them money!!), the truth appears to be the opposite. Unlike food aid, the money does not displace local farmers or tradesmen, it multiplies through them. With new microfinance technology, transfers are almost instant and inexpensive.

Best of all, I think, we create more economic actors on the global stage, who act to mitigate via the power of large numbers the concentration of wealth and decision-making by the ultra-rich. We see this happening as China's middle class suddenly exerts enormous sway on markets of all kinds. The effect of the leap to fuller economic participation is even more amazing when starting at the very bottom.

I will monitor the news about these types of efforts, but I think the economists are on to something here. And I think I want to be part of it.

Monday, December 24, 2012

Junkbox, Episode YOOL...  

Best wishes for your Christmas!
Pass the sugar plums.
O Holy Night...  

A story too close to home...
Finbar Wright has sung Christmas concerts all over the United States for 12 years as part of the Irish Tenors. One night in Houston, things went a bit wrong.
"We had a slightly older guest conductor and he had this kind of thing where he would sing very quietly with the singers," he said, laughing at the memory. "Over the general clatter of an orchestra and three tenors the audience usually couldn't hear it, but it just so happened on this night that the first violinist's microphone was very close to the conductor. He really loved 'O Holy Night' and started getting carried away, slightly out of tune and not quite hitting it. He got louder and louder until the first violinist broke down laughing. Then her neighbor started and next thing you know, the whole thing ground to a halt.
"Everybody took it in a great spirit. The conductor was very apologetic, and we just started it again. The funny thing is that the resumed performance had taken on a completely different life because suddenly it seemed like a special emotion had been injected into the whole thing. The humanity had been brought back into the divine." [More]
Sang it myself, way back in the day, and listened to a remarkable tenor and friend sing it throughout my life Christmas Eve. I still struggle not to not breathe at the crucial moments - which is the key to doing it well.

It ain't easy, so let performers know when it's done well.


A little help from my friends...  

The mini-blizzard in the Midwest knocked down out Internet towers, and it was kinda sad how Jan and I clutched our backup access (via smartphones) while it was being fixed. Meanwhile the computerized mixer on the church sound system also crashed and that is my responsibility, so I've been occupied.

Christmas cookie consumption also played a part.

But some readers offered these interesting tidbits.

From Kevin in Ontario, this bizarre story of gaming the Canadians!!
Bioversel Trading hired CN Rail to import tanker loads of biodiesel to the U.S. to generate RINs, which are valuable in the U.S. because of a "greening" policy regulating the petroleum industry. The EPA's "Renewable Fuel Standard" mandate that oil companies bring a certain amount of renewable fuel to market, quotas they can achieve through blending biofuel with fossil fuel or by purchasing RINs as offsets.
Because RINs can be generated through import, the 12 trainloads that crossed into Michigan would have contained enough biodiesel to create close to 12 million RINs. In the summer of 2010, biodiesel RINs were selling for 50 cents each, but the price soon fluctuated to more than $1 per credit.
Once "imported" to a company capable of generating RINs, ownership of the biodiesel was transferred to Bioversel's American partner company, Verdeo, and then exported back to Canada. RINs must be "retired" once the fuel is exported from the U.S., but Bioversel says Verdeo retired ethanol RINs, worth pennies, instead of the more valuable biodiesel RINs. Bioversel claims this was all perfectly legal.
However, one of the companies Bioversel approached to be the ‘importer of record’—Northern Biodiesel Inc. of Ontario, N.Y. — discovered that the same fuel was going back and forth across the border and the same gallons were being used to repeatedly generate new RINs under their company’s name. The company called the EPA and also sent a letter that would become an open letter to the biodiesel industry, accusing Bioversel of “trying to perpetrate a fraud against NBI and the Renewable Fuel Standard program.”
The EPA, which has a buyer beware policy for oil companies that buy RINs, did not act immediately, and the industry has been begging for it to play the role of sheriff on this case and others. The EPA won’t comment on continuing investigations, but insiders said the case is still under investigation. [More of a great investigative story]
Ah yes, ethanol - The American farmer's ACORN. What can I say, except I am shocked - shocked, I tell you - our mild-mannered neighbors to the north would take advantage of a dismally market-distorting subsidy program just like they were 'Mericans.

However, due to changes in the RFS, there may be more "Dakota shuffles" in the future.
The 2012 drought led to significant increases in corn prices and a slowing in domestic ethanol production and exports. For the first time since the RIN system was established, it is estimated that 2012 net RIN generation will not exceed the non-advanced ethanol mandate, and RIN stocks carried over from previous years will be used for mandate compliance. This was reflected in 2012 ethanol RIN prices, and illustrates how the design of the system can be used by obligated parties to respond to variability in the economics of ethanol blending. Current estimates indicate continued flexibility for corn-for-ethanol demand to meet the 2013 non-advanced mandate, but at lower levels than in previous years due to estimated stock use in meeting the 2012 mandate. [More]
They are not the only neighbor to benefit from this intricate mandate.
Meanwhile, back here in the home country, the impact of our inability to spin straw into ethanol means we have only piddling amounts of advanced biofuels to meet the mandate. But what about biodiesel, the Great Hope of soybean producers?
But if we make much of that from soya, what about the rising global demand for soyoil?
Global demand for vegetable oils for food and biofuel use is expected to increase by an additional 23 million tons by 2016; however supply is expected to struggle to keep up with the demand, according to a new report from Rabobank.
According to the report, “Finding the Food-Fuel Balance," vegetable oil stocks reached a 38-year low in 2012 due in large part to constraints, such as land availability and adverse weather. For the past four years, the world’s stock-to-use ratio for vegetable oils has been on a declining trend and will reach a low of 7.5% in 2013, a level not seen since the mid 1970s. The decline is largely down to supply’s inability to keep up with rising demand. Production shortfalls in recent years have resulted in a draw-down of stocks that is unlikely to be reversed in the near future. [More]
Now add in the migration of the Corn Belt north, and maybe the smart move in my part of the world is to plant a heckuva lot of beans on those CoC acres instead of continuing to pound our head against the production barriers that are more serious than we thought when triple-stacks gave us a couple of penalty free yields.
[From Ron]
Corn’s new appeal to Canada’s prairie farmers is based on two things: climate change and price. Growing seasons in the prairie provinces—which border Minnesota, North Dakota, and Montana—have lengthened about two weeks to up to 120 days in the past half-century. The mean annual temperature is likely to climb by as much as 3C (6F) in the region by 2050, according to Canadian researchers.
A temperate climate and longer growing season are ideal for corn. An acre of farmland produces more corn than wheat, making corn the more profitable grain, while the higher yields drive up land values as well.
Corn has long grown in southern Ontario’s mild climate, but for Canadians to be big players in the crop at a new order of magnitude, they must plant in the vast farmland of the prairie provinces. Farmers planted a record 121,400 hectares (300,000 acres) of corn in Manitoba, Saskatchewan, and Alberta this year.
Global corn demand has outstripped supplies three of the last four years. That shortfall, along with the more hospitable growing weather and the introduction of seed varieties from Monsanto (MON) and DuPont (DD) that make plants mature faster, is transforming Canada’s grain mix, says Danny Blair, a professor of geography at the University of Winnipeg. “The winters have warmed and shortened dramatically,” accompanied by more rainfall that allows for earlier planting and greater soil moisture that helps crops.
Global warming will increase the frequency of drought and erratic rainfall even in Canada, says Blair, who notes that the weather creates more opportunities for Canadian agriculture, despite the risks. The anticipated boom in corn is encouraging U.S. agribusiness giant Cargill to invest in grain storage in Canada, according to Chief Executive Officer Gregory Page. The prospect of new demand from Canadian corn farmers is pushing DuPont Pioneer, a seed division of DuPont, to improve its short-season crop varieties, says John Soper, the company’s vice president of crop genetics research and development. [More]
It is in-your-face developments like new yield patterns that will change attitudes about global warming, certainly not mere science. And I think those minds who have the freedom to actually to contemplate the implications without cognitive dissonance from their political catechism will enjoy a distinct business advantages.

Rolling all these ongoing developments into 2013, add the incredible political turmoil in the US, include the ongoing drought, and we have the possibility of a year that makes 2012 seem tame.

This also mean incredible rewards for those who step up to the challenges, IMHO.

Just hope they don't farm near me...

Wednesday, December 19, 2012

Why the University of Illinois...  

Is an embarrassment to me and a few other residents.  No, not the routine administrative malfeasance.  Not the football team.

It's the quality of scholarship in which they should excel: agriculture.

Exhibit A


It is not nitpicking to expect published work to be edited by people who can spell.  This is not a tweet or e-mail, it is an widely distributed study purporting to show the level of serious analysis our state's major university is capable of.

Seriously, how many spelling errors can you spot?

Man up, Illini.  Purdue is giggling.
No mood at all...  

I am a gun agnostic. Don't own any. Don't want to. Don't care if you do.

While I would cheer European level gun ownership restrictions, I will not invest any effort to tilt that windmill. It is futile to debate those to whom firearms provide an element in their lives I cannot comprehend. This should be clear to gun control advocates.

But mostly, I think we will outlive this issue as a culture, perhaps in my grand-children's lifetime. 

Consider these trends:


And this one:


 And this one:
 The ownership rate reported is the average estimate taken from "Annexe 4: The largest civilian firearms arsenals for 178 countries. That table gives also the minimum and maximum estimates. Note that for some countries, this margin of error is considerable. E.g. Yemen, ranked near the top with an ownership rate of 54.8, has a low estimate of 28.6 and a high estimate of 81.1. While the United States is ranked for the highest gun ownership rate unambiguously, Yemen based on the margin of error may rank anywhere between 2nd and 18th, Switzerland anywhere between 2nd and 16th. [More]

My conclusion is it will be hard to stuff more guns into the closets of America. The firearms industry will either have to sell innovation (which can only be bad for people) or sell to places where they still don't have "enough" guns. It reminds me distantly of the beef marketing problem.

The US will continue to have a powerful gun lobby and constituency convinced they are protecting some facet of American character that can only be flourish with firearm protection. They will, however, slowly diminish in both number and relevance, it seems.

Like farmers.

No one will take their guns away. Somebody will just sell them after they die. And guns won't make those deaths any less unlikely.

Tuesday, December 18, 2012

Oil's not well...  

I use synthetic oil and change every 10,000 miles in my cars. It's my own regimen based on the example of the big engines on  my farms, operating in extreme environments, and manufacturer recommendations of 250-500 hours.

The idea a small car like my Equinox needs new oil every 3000 is absurd.

It turns out there is a tug-of-war between oil companies and the auto industry over this bad habit.
I use an app to track mileage and service intervals. It has become habit to enter the odometer readout and gallons each fill up. I set my service interval at 10K. Warranty be damned.

What's weird is how diligently I watch the mileage now.

(27.7, in case you were wondering)

Monday, December 17, 2012

First, the brontosaurus...  

Now the white tiger. Is nothing real in my mental zoo?
 This level of misinformation should not come as a surprise. Many of the venues that display white tigers have a long history of shading the truth about their mutants. The Cincinnati Zoo, an otherwise respectable institution, labels their white tigers as a “species at risk!” Nowhere on the zoo’s website or at its tiger enclosures does it point out that this species at risk is in fact an ecologically useless hybrid of Bengal and Siberian strains, inbred at the zoo’s own facility for big money. The Cincinnati Zoo repeatedly bred closely related animals over the past few decades to produce more of the white tigers, which they sold for around $60,000 each. [More
I have long been uneasy with where the line should be drawn for artificial breeding programs. What we do to dogs long since passed bizarre to border on inhumane, IMHO, but taking species to extremes seems to be part of our human culture. Nor do I have any profound suggestions as to how/whether to correct this tendency.

 But it seems to me to be one more negative influence that alters how we see our relationship with other animals, and one more background thought that will push us toward different attitudes regarding meat consumption. Not a biggy on its own, but part of the growing drift away from old, perhaps even instinctive disregard for other species. 

Add in the shrinking population of hunters, and you accelerate the drift toward nontraditional views of humans and wildlife in our culture as a whole.
States that rely on tens of millions of dollars in hunting license fees annually to pay for environmental conservation are trying to boost a population they had never thought of protecting: the endangered American hunter.
The number of hunters has slid from a peak of 19.1 million in 1975 to 12.5 million last year, according to the U.S. Fish and Wildlife Service. [More]
While the protein industry has rightly been concerned about who shapes American attitudes about eating meat, I think the currents are far deeper and stronger than just YouTube videos from slaughterhouses. Not am I sure the industry should seriously think they can guide the evolution of how our population thinks about food animals. There has been too much crossover emotion from pets, too much reliance on obscurity of our activities and apathy among consumers, and now too much continual revelation of husbandry practices that activate what moral psychologists lable the sanctity/purity moral foundation

These nudges yield proscriptions like kosher law and similar cultural taboos concerning food. Once established to address some hard-to-define uneasiness, they become difficult to modify. I think we are in the middle of modifying our moral attitudes toward other species, and it not just foodies doing the questioning.

Sunday, December 16, 2012

Junkbox, Episode XXI (Mayan)...  

I just received the coolest present from a friend in our dinner club. It's for 14+, so right up my alley.
Denial is getting harder...  

And it's not just this record-setting year.

Check out this graphic:

 OK, then.

The "survival rate" scam...  

As you wearily know, I am in the camp with those who think we are over-diagnoed, and over-treated especially when it comes to cancer. (I'm also recently dubious about hypertension). More and better ways of explaining this fundamental logic error are being found. Here's a good one:
Mortality rates define the number of people who die of a certain cause in a year divided by the total number of people.  For instance, the mortality rate for people with lung cancer in the United States is 53.4 per 100,000 people.
Survival rates are something else entirely.  They calculate the percentage of people with a disease who are still alive a set amount of time after diagnosis.  The five year survival rate for people with lung cancer in the US is 15.6%.
But here’s the thing.  You can only decrease the mortality rate by preventing death, or curing the disease.  That’s really it.  That’s a cure or a life extension, and both are unequivocally good.  Survival rate, however, can be increased by preventing death, curing the disease, or making the diagnosis earlier.
The mortality rate is unchanged.  The same number of people are dying every year.  We have just moved the time of diagnosis up and subjected people to five more years of side-effects and reduced quality of life.  We haven’t done any good at all.  We haven’t extended life, we’ve just lengthened the time you have a diagnosis.
Think this is far fetched?  In England women are screened by mammography every three years starting at age 50, yet in the United States the American Cancer Society recommends women are screened by mammography every year starting at age 40.  For a woman diagnosed with breast cancer in 2001, the five year survival rate in the US was 89.1%; in England it was 80.3%.
The mortality rates?  The American Cancer Society’s Cancer Facts & Figures 2009 reports it’s 25.0 per 100,000 women in the US and Cancer Research UK reports it’s 26.7 per 100,000 women in England.  That’s not as big a difference.  Hard to believe we’re spending almost two and a half times per person for health care what they do over there. [More]
Or to put it in picures:

We are going to do some dumb, well-intentioned things to deal with health care costs. We have to. But there are better ways of making these decisions. Dealing with real numbers would be a start.

Saturday, December 15, 2012

We know predictions are worthless...  

But then you aren't paying for  mine anyway.  So here's one. I think we're going over the cliff. I'm not alone.
1. The Politics Have Become Worse, Not Better. The House GOP is digging in its heals even further in spite of the fact that the polls all show public opinion -- including among Republicans -- being firmly against it. Meanwhile, the White House, no doubt strongly encouraged by the president's high job approval rating and the polls showing that it's position on taxes is very popular, apparently -- and understandably -- sees no reason to compromise.
2. The GOP Has Little To Lose At This Point By Letting The Cliff Happen. With their polling numbers already in the tank, it's hard to see what Republicans will gain politically by voting to increase taxes in incomes above $250,000 a year other than the lasting enmity of the most anti-tax members of their base and Grover Norquist.
3. Boehner Really Can't Cut A Deal With The White House Before January 3. My  prediction that this would happen was scoffed at by some when I made it months ago, but it's now become a mainstream story. The fiscal cliff hits January 1 and  Boehner's formal election as speaker is January 3. Any deal with the White House and especially a deal that includes the tax increases the White House wants, could cause Boehner to lose enough votes at least on the first ballot on January 3 to prevent him from being speaker. Even if he subsequently wins on a later ballot, he will be seriously weakened. Note: The fact that Boehner has been openly asked this week if he's concerned about being reelected is a sign that the possibility has become more real than anyone but me previously was willing to consider.
4. It's Still Not Clear That A Boehner-Obama Deal Would Be Agreed To Before January 1. Very simple: The political work needed to get the votes in the Democratic and Republican caucuses in the House and Senate hasn't yet occurred and that makes the vote count very dicey. A tax cut that's acceptable to Boehner may not be to his caucus, and larger-than-expected changes in Medicare and Medicaid that's acceptable to the White House may not be acceptable to Senate Democrats. In addition, it's not clear how many of the lame duck members of Congress will even show up to vote a week before their term is over [More]
I'll leave it as an open question in which I'm not deeply invested, but I do think I'll imagine how it could affect the farm.

This post will be about changes to depreciation and machinery sales.

It dawned on me Aaron has never even had to depreciate any of his machinery - he's been able to write it off annually under the bonus-extra-accelerated-bonanza tax breaks we've gotten very used to the last few years.

What happens when we go back to 7+ year drip-by-drip depreciation? Some speculation:
  1. Capital purchases don't just slow - they dang near stop.  Farmers will hold their breath for a long time expecting some retroactive fix to this quantum change. No spending will occur during that time. Secondly, we've been pretty active adding new paint. We really can go for considerable time before anything wears out. Add to that the fact that the newer stuff doesn't wear out as fast. We've been buying new features, not replacing worn iron.
  2. Leasing could come back big-time. If you really have to get new stuff, it might maximize your write-off.
  3. Some pretty serious machinery upgrades will be deemed maintenance rather than depreciated. Heck, we do this already, but if machinery dealers can repackage new technology in a way accountants can wink at it, they could sell more.
  4. Tiling, drainage work will come to a halt. Going back to long-term depreciation schedules instead of instant write-offs will end the drainage binge. Imagine how you would feel if two years from now they do increase the expensing amount again and you've locked a big project in for 15 years. Better to wait and see for a couple of years or the next election. Net impact: the longer the depreciation term, the deeper the cutback. Besides new tile won't help much during next year's drought (heh).
  5. There will be some serious lobbying on this issue because it isn't that expensive - about $33B per year, and is not exclusively for farmers. In fact, I think this is more likely than restoring farm program cuts.
  6. There will be some whopping tax bills in rural America for 2013. Many of us have zero depreciation left. New paint won't help much either. My guess is we've already moved all the income we can to the following year so it won't be pretty 1 March 2014.
As I said, just some idle thoughts for a mind that should be doing our Christmas letter and two FJ articles.

Plenty of time for those...

Thursday, December 13, 2012

Sugar stuff, ctd...  

In answer to Troy who comments below:
"I understand her point and agree with it, but the numbers she is using are ridiculous.
She states that the sugar quota costs the U.S. $3 billion/year.
She then claims that each sugar farmer gains $3 million/year from the artificially inflated prices.
Using those numbers suggests that there are roughly 1,000 sugar farmers in America.
There are somewhere in the neighborhood of 10,000 sugar beet growers in the country not to mention all of the cane growers.
If one of her numbers is off by at least a factor of 10, it makes your question the validity of her other information. "
First, how many sugar producers are there?  Well, as usual we can only know numbers from the distant past, thanks to the split-century work of the USDA.
The number of farms growing sugarcane and sugar beets declined from 2002 to 2007, but the average area harvested per farm increased. According to the 2007 Census of Agriculture, the number of farms growing sugar beets and sugarcane decreased from 5,980 in 2002 to 4,714 in 2007. The number of farms growing sugar beets declined from 5,027 to 4,022, while average area harvested per farm rose from 272 to 312 acres. The number of sugarcane farms dropped from 953 to 692, while average area harvested grew from 1,027 to 1,224 acres per farm. [More]
As for the amount, the economist in the video isn't too far from other estimates.
So, doing some quick and dirty engineer math (we're trustworthy, remember?), if there are today, say, 3500 beet and 500 cane growers, and the program costs consumers $2.4B then the average benefit to a grower is $400,000. But cane constitutes 45% of the output with only 12% of the producers so their average returns would be markedly higher.

On the whole, I don't find her numbers way out of line, given the uncertainty of the numbers. But beet growers especially may feel it over estimates their benefits simply because of the lopsided distribution. I have read there are some really rich cane growers.

Finally, the argumentation method of using one questionable number as disqualifying the whole assertion is invalid, IMHO. Maybe one number unravels the whole chain of logic and maybe it has little effect.  Unless any number can be refuted with better information or logic, there is no contagion factor. I guess this is my takeaway from the climate change rancor.

Star Wars VII (?)...  

Can't come soon enough in Britain.

About a quarter of a million people ticked the “Other religion” write-in box. Among them, 56,620 wrote Pagan, while Agnostics and Atheists claimed around 30,000 adherents apiece. Rastafarianism, Zoroastrianism and Shamanism made the list, while the most common was Jedi Knight, by 176,632 Star Wars fans.

And the census results?


And guess who else is stoked?

I think I'd sooner have Jar-Jar...

Wednesday, December 12, 2012

Seeing more stuff like this...  


The drip-drip of subsidy reform efforts might actually work eventually.
How to define good government...  

Ask not what you can do for America...or something like that.

The lede says it all:

"Farmer-friendly state tax exemptions, credits illustrate the good government can do"


I saw this coming...  

Philip Tetlock, whose seminal work on the "prediction problem" has shaped my views about punditry has written an amazing follow-on article for The Edge (well worth the reading).
I am intrigued by the early results. While it seems reasonable that political predictions are inherently impossible, despite our relentless desire to believe, the idea that we could harness the best of human insight and mechanical advantage (algorithms) is slightly disconcerting. It's like all those time-travel/foreknowledge paradoxes in science fiction or Calvinist theology: if we could foretell the future what would it mean?

BTW, I applied to be on the team, but didn't make the cut.

Put your name in.


Tuesday, December 11, 2012

Junkbox, Episode NOEL...  

Monitoring the many ongoing debates in Washington re: the fiscal cliff.
All in all, much to lose" in farm country because we enjoyed so many perks.

Sunday, December 09, 2012

This is unexpected?...  

Ag Secretary Vilsack's blunt criticism of rural voter political tactics received a lot of headlines in the press.
I'll grant that Visack is not a charmer at his most congenial, but while his assertion has some validity, I suspect the larger problem is the intense gerrymandering that has created rural districts so heavily Red that representatives can get away with anything secure in the knowledge that ideology will trigger an automatic response in the voting booth.
Democrats have been packed into three uncompetitive seats around Philadelphia, an uncompetitive seat in the Lehigh Valley, and a safe seat in Pittsburgh. The state's suburbs, exurbs, and rural areas have been rigged to be just outside the range where Democrats might win them. [More]
Note also the cognitive dissonance in demanding a new farm bill with an indisputably lavish safety net for grain producers and the emphasized statement above. If I were a rural legislator in a blood-red district all I would fear is an even redder primary opponent. The irony here is the far, far right is the biggest threat to farm subsidies.


Saturday, December 08, 2012

No wonder marketing is harder...  

The other side is using more educated people.

At the very least it seems as if more employers are using bachelor’s degrees as a signal of drive or talent, regardless of of the relevance of the skills actually learned in college.
That is one implication of an analysis from Burning Glass, a company that analyzes job ads from over 20,000 online sources ranging from major job boards to small and midsize employer sites. The company’s chief executive, Matthew Sigelman, says that employers are increasingly requiring college degrees for positions that did not traditionally require higher education.
I asked his company to compile a list of occupations that have shown the most “up-credentialing” in the last five years — that is, occupations whose job ads were significantly more likely to name college diplomas as a prerequisite in 2012 than they were in 2007.
Here is a look at the 10 occupations with the biggest percentage increases in requiring a college degree.
Occupation title 2007-12* Growth in % of Posted Jobs Advertising for a Bachelor’s Degree 2007 % of Ads Requiring Bachelor’s Degree 2012* % of Ads Requiring Bachelor’s Degree
Dental Laboratory Technicians 175% 12% 33%
Chemical Equipment Operators and Tenders 83% 6% 11%
Medical Equipment Preparers 55% 11% 17%
Buyers and Purchasing Agents, Farm Products 43% 54% 77%
Electronics Engineering Technicians 38% 21% 29%
Dental Hygienists 38% 40% 55%
Architectural Drafters 37% 41% 56%
Cargo and Freight Agents 36% 33% 45%
Photographers 36% 25% 34%
Claims Adjusters, Examiners and Investigators 35% 48% 65%
*2012 data is from Nov. 1, 2011, to Oct 31, 2012 
(I am assuming that the "Buyers and Purchasing Agents, Farm Products" would be Cargill marketing reps or similar jobs. Maybe Monsanto field reps?)

If you wander through the comments, you'll notice several possible implications from this report. I agree a tough employment market makes "up-credentialing" an easy way to winnow, but also agree that more jobs simply need better education levels than high school seems to be providing. 

With some exceptions, I am not persuaded that college degrees certify the same level of education as they used to. Dumbing down is a crude way of putting it, but it could also be the relative rigor in key academic areas I associate with college degrees from my own era is unnecessary given the compensatory power of computers. Why master any topic when you can google the info you need when you need it?

My Dad used to bemoan the fact I didn't learn the multiplication tables all the way to 25x25 as he did, so I'm guessing my lament is just geezer harrumphing. When skills can become obsolete almost overnight (floor traders), what exactly should colleges teach?

Meanwhile, in our own ranks, the percentage of college graduates seems stagnant.


Of course, this is before the Great Return that started in 2008 as farm incomes suddenly made going back home more attractive to graduates. We'll have slightly less dated info from the 2012 Census of Ag in a couple of years when USDA gets around to it with their usual alacrity.

Sunday, December 02, 2012

We're not going to 10...  

We may not make 9 billion. And we'll peak sooner than expected.
I write about this every now and then, because human fertility is falling faster then most demographers expect.  Using the CIA Factbook for data, the present total fertility rate for the world is 2.47 births per woman that survives childbearing.  Last year it was 2.50, and in 2006 it was 2.90.  2.10 is replacement rate.  At the current trend, the world will be at replacement rate in 2022.  That’s a lot earlier than most expect, and it makes me suggest that global population will top out at 8.5 Billion in 2030, lower and earlier than most expect.
Have a look at the Total Fertility Rate by group:


This is more evidence we are throwing the "9 billion by 2050" around in agriculture too casually. As wonderfully explained by this chart and better by this video.

I would suggest not only will we have enough land and water, less intensive diets in the developed world will ease the food squeeze on poorer countries. A little less waste and presto the food shortage hysteria is revealed as overhyped. One caveat: I hope Canada and Siberia can gear up to be the new grain producing centers as the climate changes.

It is hard for us to imagine a falling population in the US, but we farmers can kinda sense it as rural America depopulates. My sons and grandchildren could experience it in a completely new kind of world - a demographically top-heavy world of too many geezers and too few teenagers.