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Arizona Debate Institute 2008 1

Pre-Institute Evidence State Econ DA
States Econ DAs
States Econ DAs...................................................................................................................................................................1
Iowa Econ Shell (1/3)...........................................................................................................................................................2
Iowa Econ Shell (2/3)...........................................................................................................................................................3
Iowa Econ Shell (3/3)...........................................................................................................................................................4
UQ: Iowa Econ Strong..........................................................................................................................................................5
Lnx: Iowa..............................................................................................................................................................................6
Lnx: Corn Ethanol Key 2 Iowa.............................................................................................................................................7
Lnx: Corn Ethanol Key 2 Iowa.............................................................................................................................................8
Lnx: Corn Ethanol Key 2 Iowa.............................................................................................................................................9
Lnx: CAFOs Key to Iowa...................................................................................................................................................10
Internal Lnx: Iowa dependent on Ag...................................................................................................................................11
Brink: Ag Collapse..............................................................................................................................................................12
Brink: Ag Collapse..............................................................................................................................................................13
Internal Lnx: US Econ depends on Ag...............................................................................................................................14
Internal Lnx: US Econ Key 2 Global Econ........................................................................................................................15
Internal Lnx UQ: US Econ Ok...........................................................................................................................................16
Non-UQ: Econ Low Now...................................................................................................................................................17
Iowa No Lnx.......................................................................................................................................................................18
Turn: Iowa & Ethanol.........................................................................................................................................................19
No Internal Lnx...................................................................................................................................................................20

Arizona Debate Institute 2008 2

Pre-Institute Evidence State Econ DA
Iowa Econ Shell (1/3)

A. Iowa’s economy is strong now
Iowa, 07-15-08 ( “Rep. Olson: Iowa Ends Year With Strong Economy” For More Information: Rep. Tyler
The state of Iowa ended the 2008 fiscal year on June 30 and preliminary reports from a non-partisan state agency show
Iowa's economy is strong with revenues exceeding expectations by about $40 million. "Despite national trends, Iowa's
strong economy is proof that our commitment to a balanced state budget and focus on job creation is working," said
State Representative Tyler Olson of Cedar Rapids. "The state's fiscal house is in order with $620 million in our reserve
accounts and we are working with local communities and businesses to create good-paying jobs for Iowans." According
to the non-partisan Legislative Services Agency, Fiscal Year 2008 ended with 9.4% revenue growth. This rate of
collections compares with the Revenue Estimating Conference (REC) estimate of 8.8%. The REC estimated that fiscal
year 2008 general fund receipts would grow by $540.2 million, from $6.138 billion to $6.678 billion. The 9.4% growth
rate helped to push the growth in receipts to $580.1 million, $39.9 million more than estimated.

B. Iowa’s economy is dependent on subsidies – cutting them down would have a ripple effect
throughout the ag community
Northwestern Financial Review, 03-15-02 (Dullum, Justin “Farm bill: Heading into home stretch,”
In spite of powerful lobby opposition, a majority of the Senate supports the bill. There is also lobbying support for the amendment. For instance, the
Iowa Farm Bureau has officially dissented from the national group's opposition to payment limitations. Iowa sees 75 percent of its farms
receive subsidies, the vast majority of which fall under the proposed payment cap. According to the latest data, less than 50 of 151,984 subsidy
recipients in Iowa received more than $275,000 in 2000. Kansas which, like Iowa, does not have many farms that would be affected by payment
limitations, is not overly concerned with the amendment, said Jim Maag, president of the Kansas Bankers Association. Yet the state is caught in the
middle. "Our legislators aren't exactly crazy about the entire bill but the payment cap is not our biggest concern," said Maag. "The income provision is
more of a big deal. That could be a problem. We've got some huge dairy operations in parts of this state that can get up to the $2.5 million cap pretty
quick." Maag said opposition to particular provisions of the bill, however important, pale to the overall
necessity of a bill-period. "There's no doubt we have a lot of rural banks in the state that have marginal farm
customers. They're depending on those federal payments. If they aren't there, it will have a ripple effect, not
only on the banks, but on the entire ag community. We haven't had good weather. For the last three years, the federal subsidies
have been the salvation." The other issue threatening to stall the bill is a facet of the Senate version that limits meat processors' ownership of cattle
and hogs. "This is a big issue in the Midwest," said Blanchfield. "The idea is that if packers own the livestock, they can easily manipulate the market
and drive prices down. In existing laws, the ownership aspect of this is clear but when, in fact, is a packer a controller? There has been a lot of debate
about that in the Senate. They've established in dialog what they think it means, but have yet to get something formally done." The amendment was
sponsored by Sen. Tim Johnson (D-S.D.).Debate on this issue has been focused on Iowa, Minnesota and South Dakota,
where farm subsidies are a critical part of the rural economy. These states also are expected to host three of the year's most
contentious Senate races. In these three states, there is broad support for restrictions on meatpackers and a limit on payments to big farms.

.a midcycle pause as occurred in 1986 and 1995 .Arizona Debate Institute 2008 3 Pre-Institute Evidence State Econ DA Iowa Econ Shell (2/3) C. will serve as masters of ceremonies today. The agriculture industry is the backbone to the US economy – a depression in the ag community would impact the whole country Business Wire. Representative Bob Goodlatte (R-VA). Leading corporations.. staff writer for the Financial Mail. agriculture plays in the stability of the economy and in feeding the world is the goal of National Agriculture Day and National Agriculture Week. one of the nation's most distinguished farm broadcasters. which contributes more than one-tenth of the U. GLOBAL ECONOMY. DC. Orion Samuelson.S. US key to world economy Bisseker. as well as elected officials. http://findarticles. the backbone of the nation's National Agriculture Week's kick-off begins today with the celebration of National Agriculture Day in Washington. senior vice-president. agricultural marketing at John Deere. May 18. Financial Mail. 2007. A series of events designed to celebrate American agriculture and honor the people who work to meet our everyday needs will take place throughout the day. 2006 (“Agriculture Leaders Celebrate National Agriculture Day.or the early stage of a recession. To kick-off National Agriculture Day. Washington. economy. the rest of the world catches a cold. spoke at an FFA rally held in front of the Capitol building. The IMF's latest World Economic Outlook seeks to answer this question and to probe whether the rest of the world can decouple from a US slowdown or whether the tighter integration of the global economy has increased the scope for spillover effects. The big question is whether the US weakness is a temporary slowdown . p." stated Brian Peterson. with keynote speaker U. D. government agencies and industry organizations will gather in our nation's capital to educate Americans about the essential role of agriculture in maintaining a strong economy.ln ) Investors are watchful. hence the expression: "If the US sneezes.S. US recessions have in the past usually coincided with significant reductions in global growth. aware that growth slowdowns are often precursors to turning points in economic activity. "Supporting the Agriculture Council of America and the Ag Day effort is a very effective way to help the public learn more about the important role the American farmer plays in their lives today." said Doug DeVries." "John Deere has been committed to the American farmer since 1837. executive vice president and president. such as Archer-Daniels Midland (NYSE:ADM) and John Deere.S. 2007 (Claire Bisseker. U." National Ag Day highlights the abundance provided by agriculture. and raising the American public's awareness of the importance U." . March 16.. Events Honor the Essential Role that Agriculture Plays in America's Economy” Business Wire. Senator Saxby Chambliss (R- GA). DC. March 19-25. More than 22 million people work in the agriculture industry.S. "These events both recognize and celebrate agriculture. When the US sneezes . "ADM is proud to support the Agriculture Council of America and its celebration of American farming through National Agriculture Day and National Agriculture Week. Other events taking place today included a luncheon at the National Press Club. and John Block. Chairman of the Senate Agriculture Committee. ADM Senior Vice President-Corporate Affairs. wholesale division of the Food Marketing Institute. Chairman of the House Agriculture Committee.

In short. a bit earlier. resulting. PhD Nuclear Engineering. Global economic decline will bring Armageddon. The ensuing holocaust is certain to immediately draw in the major nations also. Bearden. Col. Lt. o/l: http://www.htm. etc. it is inevitable that some of the weapons of mass destruction will be used by one or more nations on others. April 25. Right now. [Tom. misery. So there will erupt a spasmodic unleashing of the long range missiles. my personal estimate is that we have about a 99% chance of that scenario or some modified version of it. An interesting result then —as all the old strategic studies used to show—is that everyone will fire everything as fast as possible against their perceived enemies. . 2000. poverty. and literally a hell on earth will result. The Tom Bearden Website. we will get the great Armageddon we have been fearing since the advent of the nuclear genie. 2000. Accessed 5/11/07. death. The reason is simple: When the mass destruction weapons are unleashed at all. nuclear arsenals.Arizona Debate Institute 2008 4 Pre-Institute Evidence State Econ DA Iowa Econ Shell (3/3) E.] Just prior to the terrible collapse of the World economy. with the crumbling well underway and rising.cheniere. the only chance a nation has to survive is to desperately try to destroy its perceived enemies before they destroy and biological warfare arsenals of the nations as they feel the economic collapse.

but it isn't slow enough to make him uncomfortable. Some industries. he doesn't expect those catastrophes will significantly slow the Iowa economy." he said.4 percent in 2008. up from the April forecast of .1 percent in 2009. which contains quantitative forecasts of economic conditions and tax revenues for the State of Iowa using the latest advances in econometrics. and economic research services to. he said. In his quarterly report delivered to the state's Revenue Estimating Committee on Monday.desmoinesregister. The Board of Regents created the institute in 1975 to facilitate cohesive and continuing economic research. and the main driver of that is commodities prices that continue to go up. . Still.1 percent in 2008 and 4. Iowa’s economy is not going to go into recession any time soon . "Flooding will have a big economic cost. 07-04-08 (“Iowa economy may get worse” Des Moines Register by Donnelle Eller http://www. "Looking at these numbers. Each quarter the institute produces the Iowa Economic Forecast. but there was very little indication of recession in Iowa. and to establish a formal mechanism for providing interaction with.2 percent forecast in April. But Goss expected the state's economy to worsen before it improves as businesses struggle to reopen. according to University of Iowa economic forecaster John Geweke. but it also will spur a lot of economic activity in the state.dll/article?AID=/20080704/BUSINESS/807040362/1029) "There are growing signs of weakness. Income projections are based on state figures from the first quarter of 2008. before rebounding with the influx of disaster aid and insurance payments. Economic activity related to clean-up and rebuilding typically offset whatever economic loss was caused by the natural disasters. McGregor Chair in Economic Theory in the Department of Statistics and Actuarial Science in the College of Liberal Arts and Sciences. He said slow employment growth is one potential weakness in the state's economy. the Press-Citizen. http://www. Iowa's economy has performed better than the nation and other Midwestern states. Geweke is a professor of economics in the Tippie College of Business and Harlan E. 07-08-08 (UI forecaster predicts rising income used by the state's Revenue Estimating Conference in determining the official prediction of the rate of growth of tax revenues for the coming two fiscal years.Arizona Debate Institute 2008 5 Pre-Institute Evidence State Econ DA UQ: Iowa Econ Strong Flooding in Iowa wont hurt the economy long term – it will spur new activity with rebuilding Des Moines Register. I see no threat of an impending recession in Iowa.7 percent in 2008 and from homebuilders to appliance retailers.5 percent for 2009. tornados and storms that hit the state this spring. Employment growth is expected to increase by . in turn. and increase by . he said. an analyst for the Iowa Department of" said Geweke. Those numbers are both revised upward from his April forecast of 4. The council's discussions are." Goss said.projections for 2009 look promising UI-University News Service. Iowa's economy was already beginning to wear under higher energy prices. "Income growth continued to strengthen through 2007 and the first two quarters of 2008." said Amy Harris. Geweke said he expects personal income to grow by 5. director of the Institute for Economic Research in the Tippie College of Business.9 percent in 2009. "We have seen stronger times. down from the . Revenue figures are based on data through the second quarter of 2008. will see an immediate boost from the flooding. government and industry. he said. Higher diesel and natural gas costs pushed higher business operating and transportation costs.dll/article?AID=/20080708/NEWS01/80708004/1079) State revenues and incomes should continue to rise through 2009 and hold off an economic recession in Iowa. While the projections do not fully account for damage sustained in the floods." Harris said.1 percent. She expected flooding to drag down future indexes. The Institute for Economic Research serves Iowans as an advisory group to the Governor's Council of Economic Advisors.

No other state -even sprawling ones with large farms such as Illinois. or fathers and sons. Even that number is likely too high because brothers. "But it's a fairly small number of recipients affected. The Des Moines Register used U. just 45 operations received more than the proposed cap during 2000. Those operators could each receive up to $275. or enough to provide every man. but probably is close. Among that group.Only 45 Iowa operations were above limit in '00 Des Moines Register February 10. who received $408. individual farms are limited to $460.Arizona Debate Institute 2008 6 Pre-Institute Evidence State Econ DA Lnx: Iowa Iowa’s economy is dependent on farm subsidies Des Moines Register." The Senate measure also tightens rules on absentee landlords who could receive subsidy payments. 2002 Sunday) Currently.000 in payments if they meet certain requirements. Farm subsidy payments are important to Iowa's economy. That could affect people such as Des Moines businessman Bill Knapp.5 million a year. as well as for those whose average income exceeds $2.000 in farm subsidies from 1996 through 2000 for his various land holdings in Iowa." he said. 02-10-02 (Farm subsidy cap would hurt few. "There are a number of provisions in the amendment that don't track with our database. although subsidies are essentially uncapped under programs that guarantee minimum revenue for certain commodities. The state's farmers and landowners received $6. .75 billion in subsidy payments from 1996 through 2000.300. Department of Agriculture data provided by the Environmental Working Group to look at Iowa's top-100 farm payment recipients from 1996 through 2000. woman and child in the state with a lump-sum payment of $2.S. Texas and California -received more money during those years. jointly operate many of those farms. Cook said the Register's estimate is not perfect.000 in annual crop payments.

the promotion of mixing petrol with renewable fuels and a high tariff that keeps out foreign ethanol. that region is the north-western part of the state. Production has been boosted by economically-questionable help from state and federal governments. Corn-based ethanol is neither cheap nor especially green: it requires a lot of energy to produce. In places such as Lakota and Marcus. a research firm specialising in agriculture. among 900 or so other small investors. which built some of the state's first modern refineries and have made a bundle because of high oil prices and subsidies. On consecutive days in Iowa last week there were ceremonies to break ground for a new factory in Hartley and to open a completed one in Corning—where bad weather had grounded the Vanguard Squadron. Iowa. The first local groups to do so were in remoter areas where farmers could not get the best prices for their corn because of the high cost of transporting it to market. a couple of local parts-suppliers for John Deere (a big farm-equipment company) and the local school-bus driver. Iowa. which enjoys high crop yields but gets 25-50 cents less per bushel because it is too far from the Mississippi river barges. 2007. nearly a third of America's total capacity. says Ken Eriksen. who analyses transport patterns at Informa Economics. Iowa's ethanol economy” May 12. All this activity is benefiting rural economies and related industries big and small. So long as a refinery can be built near good rail terminals in these areas. The same logic applied in the eastern counties of North and South Dakota. with new facilities sprouting all over corn country (see map on the next page). such as Indiana and Ohio.700 in the centre of the state—would be of interest mainly to the local farmers who supply the corn that the factory turns to car fuel. Since oil prices rose above $30 a barrel in 2004 (they are more than double that now).Arizona Debate Institute 2008 7 Pre-Institute Evidence State Econ DA Lnx: Corn Ethanol Key 2 Iowa Ethanol subsides are necessary to keep the Iowa economy strong The Economist. farmers' co-operatives and local investors have also been busily building as well. ethanol capacity has grown especially rapidly. and are still climbing. . were already building lots of ethanol factories before 2004. and a growing number of states are pushing for wider use of E85. whereas corn-belt states without subsidies. California has helped to lead the way.5 cents per litre). however. points out that states that had introduced subsidies early. Jobs are being created around the factories. Outside the Golden State. in the heart of the region. Wallace Tyner. When the state banned the use of methyl tertiary butyl ether (MTBE) as a fuel additive after 2003. did not do much until oil prices rose. Many new facilities and expansions of existing ones are in the works. Investors in the refinery include the person who delivers fuel to it. rural areas across the region have been swept up in the ethanol craze. in south-west Minnesota and in other parts of the corn belt where getting corn to market is costly. a fuel blend that is 85% ethanol and only 15% petrol. Since then. local investors have ploughed their profits into home improvements. including subsidies. and local refineries for the product began popping up to cash in on a state subsidy of 40 cents per gallon at the time. the Nevada refinery is seen as a way for the whole rural community to thrive by exploiting America's new craving for ethanol and the corn (maize) that is being used to make it.9 billion gallons of the stuff a year. The federal government offers ethanol producers a subsidy of 51 cents per gallon (13. college fees and farm equipment. it is more cost-effective to convert the corn into ethanol and send that to distant markets. producing 1. And although the country is experimenting with other renewable plant-based fuels of varying feasibility. Minnesota and Nebraska. everyone had to use ethanol instead to meet clean-air standards. In Iowa. such as Illinois. the states most eager to subsidise ethanol were those with golden fields of corn. the biggest boom has been in corn-based ethanol. Like many others in the corn belt. You would be wrong. from biodiesel to (much greener) ethanol derived from trees. Iowa—a town of 6. lexisnexis) YOU might think that the opening of a new ethanol facility in Nevada. already has 28 ethanol refineries. the world's only 100% ethanol- powered aerobatics fleet. 2007 (“The craze for maize. Land prices in Iowa rose 10% last year. an agricultural economist at Purdue University. Although agribusinesses such as Archer Daniels Midland have built many ethanol refineries.

"It's worked out better than my wildest dreams. Still. Mitt Romney might have to promise to use ethanol as pomade and Mike Huckabee -. 08-11-07 (Rich Lowry [writer] “Iowa's Stake in Ethanol Distorts Our Politics” Real Clear Politics. The new market means corn-rich Hardin County has to import the crop even though it grows 35 million bushels a year.realclearpolitics. Before it's over. up nearly 50 percent over 2006. lexisnexis) "That's the secret of this ethanol industry.000 to $400." Couser said. and more than $500 million in federal cash to ethanol refiners between 2001 and 2006. We will produce 6 billion gallons of corn ethanol this year.1 billion this year. Corn-ethanol is the most heavily subsidized crop – its crucial to Iowa Lowry. The Senate has passed a mandate for 36 billion gallons of ethanol by 2022." said Pine Lake President Larry Meints.000-acre farm. but Subsidies Still Flow” Washington Post.html ) Ethanol is to Iowans what marijuana is to Rastafarians: a substance that is considered quasi-holy. up 15 percent from last year. Prior to the Civil War. on the way to meeting a mandate of 7. but only because it delivers really good times. poultry and dairy products.800 a share. although the additional fuel is supposed to come from sources other than corn -. made from switchback grass and the like. a corn grower who pushed for the new plant after becoming fed up with hauling grain to distant elevators. Now. president of Iowa Falls State Bank.and meat. it was just a perversely amusing example of rank corporate welfare. That translates into profits of $100. announced profits for the previous eight months of $3. who reviews the balance sheets of hundreds of farmers. 09-28-07 (Dan Morgan [a former Post reporter who specialized in September 28. "It's keeping the dollars at home. we live in an era of King Corn. He estimates that most farmers earned between $100 and $400 an acre on their 2006 crop after expenses. Iowa farmland values are up 18 percent in the past 12 months. since livestock traditionally has been fed corn." In July. Now. depending on whether they owned or rented their land. http://www.Arizona Debate Institute 2008 8 Pre-Institute Evidence State Econ DA Lnx: Corn Ethanol Key 2 Iowa Prosperity in Iowa is based on corn-ethanol subsidies Morgan. the price of a bushel of corn jumped from $2 to $3 in the past year. Presidential candidates become fanatical supporters of the corn-based fuel as soon as they begin to compete in the Iowa a naked play for the religious right -. 2007." said Howard B. The rural prosperity is due in large measure to billions of dollars in federal subsidies and incentives for corn-based energy. The USDA predicts that net farm income will be $87.250 cost of the initial investment. with ethanol distorting markets in America and around the world. Pine Lake Corn cellulosic ethanol. southerners genuflected before King Cotton. thanks to the demand for more ethanol.tortillas have become as much as twice as expensive in Mexico -. "Things are good here. the second Hardin County plant after Hawkeye's. The county can't supply its two ethanol refineries and its thriving pork. it's not so amusing anymore. Wenger. more than the $3. When the agricultural firm Archer Daniels Midland first coaxed ($$$) Congress into subsidizing ethanol a few decades ago. We will plant 90 million acres of it this year. This is increasing the price of corn-based foods -. a nonpartisan public policy institution] “Corn Farms Prosper.000 on a baptize people in the stuff. making millionaires on paper out of any farmers owning 200 acres free and clear. These include a 51-cent tax credit that gasoline manufacturers get on every gallon of ethanol they mix with their blends. beef and poultry industries. It is our most heavily subsidized crop.5 billion gallons by 2012. is a contract writer of the newspaper and a fellow with the German Marshall Fund. according to Federal Reserve Board surveys. .

"When I went to college. "This town was dying a slow death. A steady stream of hopper trucks drive their load of yellow gold into a double-ended unloading building. producing about 185 million gallons (700 million litres). The Poet plant's towering silver corn storage silos. located 260 kilometres northwest of Des Moines. as well as the kernels. Thanks to hefty government subsidies at the pump. It wasn't that long ago that ethanol .. the corn price surge has put an extra $9-billion into farmers' pockets. The state already accounts for roughly a third of the six billion gallons produced nationwide. a third-generation corn farmer from Emmitsburg.was a bit of a curiosity in the farm belt. and I just figured I'd wind up leaving Iowa to work. And Poet thinks it has an answer to where it will get all that corn. the area's first McDonald's and a large casino resort have opened in the past two years. For decades. ethanol production is gushing." said Craig Brownlee." plant manager Daron Wilson said.867) might just be its Spindletop . farmers were getting an average of $3. into automotive fuel. There are so many plants in northwestern Iowa that most farmers are now within 50 kilometres of at least one refinery. who moved here with his family from another small Iowa town. more than a quarter of the Iowa corn crop will go to feed ethanol plants. "It's not just the corn we buy. In all of Canada. putting it among the largest ethanol refineries in the United States. The company is poised to spend $200-million to more than double the plant's capacity to 125 million gallons. The plant's impact goes far beyond the 40 jobs the plant has already created. the town had been shrinking. S. wages and various goods and services it buys. Many Emmitsburg farmers sell nearly everything they harvest to the refinery. "To be back in my home state is pretty great. it was before the ethanol boom. Another 19 are under construction or undergoing major expansions. The scheme has worked beyond anyone's wildest dreams. new businesses are opening corn purchases.the 1901 gusher well that launched the modern-day oil industry. In Iowa." said Mr. Brownlee. not just its people and livestock.) and $2. the price of corn fluctuated between $2 (U. dumping their cargo onto conveyor belts beneath the floor. This year. could one day become a net crop importer to sustain all of them. The ethanol refinery here. . Poet alone produces more than a billion gallons. as generations of young people moved away and older farmers retired. But thanks in large part to new demand from ethanol plants like this one.S. dozens of tanker cars wait to haul ethanol to gas refineries as far away as the East and West coasts. Midwest. second only to Archer-Daniels-Midland Co. "That money turns over several times.56 a bushel in June. 3. a couple of motels. Chain stores." A vast new industry is rising out of corn fields. On a rail siding beside the plant. Emmitsburg (pop. Ben Gustafson. But on the fringes. The process will allow the company to produce 27 per cent more ethanol from an acre of corn. is one of 27 ethanol plants operating in Iowa. The expansion." The economic ripple effects can be seen here. Across the United States. never imagined there would be work for him in Iowa after earning a chemical engineering degree in the late 1990s. dubbed the Liberty Project. owned by Poet LLC of Sioux Falls. The downtown is dominated by several empty store fronts. making ethanol has meant a second chance for a rural economy that lives and breathes corn. Poet has big plans for Emmitsburg. new renewable fuel mandates and strict import restrictions.Arizona Debate Institute 2008 9 Pre-Institute Evidence State Econ DA Lnx: Corn Ethanol Key 2 Iowa Corn-ethanol is key to the Iowa economy The Globe and Mail (Canada) 07-23-07 ( BARRIE McKENNA “Corn again: Iowa finds salvation” Lexinexis) Here in Iowa. If all the Iowa plants now on the books get up and running.a 200-proof alcohol gasoline substitute . the largest corn-growing state in the U. Emmitsburg still looks like small towns anywhere in the United States. That trend has now stalled. and across a growing swath of the U.S. including farmers such as Mr. the ethanol plant's 28- year-old technology manager.D. the price of corn has nearly doubled in the past year alone. and it's little wonder many farmers proudly sport "I grow oil" bumper stickers on their trucks. Now. More than 100 residents. Add to that a dozen biodiesel plants. Gustafson.the heart of an industry that is now feeding the country's cars." Like much of rural Iowa. there are just eight ethanol plants. up from less than $2 a year ago. A quarter of the expanded plant's output will come from a newly developed cellulose process that will turn corn husks. and consume less water. and has visions of grabbing an even larger bite. earned an $80-million government grant aimed at promoting renewable fuels and weaning the United States off foreign oil. And if Iowa is the new Texas. There's a buzz around town. Poet estimates its Emmitsburg plant pumps $60-million into the local economy every year . And most experts say it will stay high for some time. up 20 per cent from last year. "We weren't making any money and we were living off crop subsidies. people are spending money like they haven't in a long time. Iowa has become the Texas of the ethanol industry . have also earned small fortunes as minority investors in the plant. which convert soybeans into truck fuel. and across Iowa. Farmers saw it as a way to get a few more cents a bushel for some of their crop.S. conveyor belts and fermenting tanks rise prominently out of the lush yellow and green corn fields that spread out as far as the eye can see.50 a bushel.

They identified some central themes and issues that exist across all livestock species grown in Iowa. sheep.” For this reason. We are at a time when Iowa agriculture is undergoing a vast structural change due to the biofuels opportunity. pork. 01-23-07(“Extension Advances Economic Development for Iowa’s Animal Agriculture Industry” Iowa State University Extension Extension Advances Economic Development for Iowa’s Animal Agriculture Industry Jack Payne’s Speech to the Iowa Feed and Nutrition Seminar) Animal agriculture plays a key role in driving Iowa’s economy. dairy. challenges.” The college released the 20+page report in November. dean of ISU’s College of Agriculture: “Development through animal agriculture is a logical and exciting avenue to grow Iowa’s rural economies. The objective was to align what all these folks know about the Iowa livestock sector and the economy with the new realities and possibilities. ISU’s College of Agriculture recently developed “A Vision for Iowa Animal Agriculture. Bringing these top people to the table could not have been more timely. particularly to benefit the state’s small towns and rural communities. Our animal agriculture industry is favorably located geographically. Let me share the key messages from this vision. To quote Wendy Wintersteen. in an area of competitive advantage for feed ingredients. and rewards for Iowa’s beef. and goat industries. and it takes a hard look at our current situation. poultry. equine.Arizona Debate Institute 2008 10 Pre-Institute Evidence State Econ DA Lnx: CAFOs Key to Iowa CAFO’s are key to Iowa’s econmy Payne. and has cropping systems that are compatible for manure utilization. The ISU Department of Animal Science conducted this year long visioning process with 40 industry representatives to evaluate the current status of Iowa’s animal agriculture and the opportunity for growth. opportunities. There are nine: .

" Eathington said. Industries profit from interdependence” http://media. "There's just a lot of numbers that get thrown around about the size of agriculture in Iowa. Food and kindred product manufacturing. Swenson said this means nearly a quarter of all the sale transactions that occurred in the state of Iowa happened because of agriculture. farms. which had a GSP of 9. production agriculture.www. he said. according to the report. according to the report. She said the new report organizes existing data and presents a consistent set of numbers by measuring things such as agriculture's contribution to the gross state product (GSP).org/farmers/farmers_12. For example. "[Many industries] might not be here had it not been for our agricultural heritage. When combined.iowacorn. Agriculture. dairy processing and cereal production. a 2003 Iowa State University report concluded that Iowa’s economy is 3. The report also shows that the value of farm receipts fluctuated between 1971 and 2000. Swenson said while agriculture has seen a decline in importance. Swenson said the College of Agriculture will use the report when communicating to various groups about the importance of agriculture in Iowa. while farms contributed 3. This data helps to "validate the mission of the land grant institution. In fact.. Agriculture Information Services program director. as well as government payments and miscellaneous farm income. Even if they do know."People may not realize . Together.5 percent and agricultural services chipped in 0.Changing-1093746. the 20-page report presents a wide range of statistics.html) Agriculture is critical to Iowa’s economy.6 percent.iowastatedaily.shtml) Agriculture remains vital to Iowa's economy although its influence has lessened during the years.. Iowa's GSP was $89." she said.Fiscal. The Iowa Corn Promotion Board’s (ICPB) grower leaders understand that profitability starts with a working environment where growers can make practical decisions about how they operate.24 billion.7 percent.7 times more dependent on farm and food and related production as a component of its economy than the rest of the nation. both assistant scientists in agricultural economics.Reliance.7 times more dependent on agriculture as a component of its economy than the rest of the nation. contributed 4. 2008 (Iowa Corn.Arizona Debate Institute 2008 11 Pre-Institute Evidence State Econ DA Internal Lnx: Iowa dependent on Ag Iowa’s economy is dependent on agriculture Iowa Corn Promotion Board & Iowa Corn Growers Association. Brian Meyer. That’s why ICPB has launched an educational campaign to remind all Iowans that the state’s economic health depends on agriculture. The report was prepared by David Swenson and Liesl Eathington. The most striking statistic takes into account the interdependence between agriculture and other percent of Iowa's total industrial output. "it's good to remind them. Iowa State Daily. according to the report. or 8. according to a new report that pulls together statistics about the economic role of agriculture in Iowa. food manufacturing and other agriculture-affiliated industries account for 24. Agriculture is vital to Iowa’s economy." Meyer said. In 1971. the number of jobs in agriculture. which includes meat packing. These results mean the Iowa economy is 3." .On.8 percent. Iowa's total farm receipts in 2000 were just under $15 billion. “Defending Agriculture in Iowa” Homepage accessed 07/22/08 http://www. said the deans and faculty of the College of Agriculture will draw data from the report when speaking to business groups and community leaders around the state. "[The report shows the] importance of the links between different sectors of Iowa's economy. Only in South Dakota." Because researchers use a variety of methods to measure Iowa's agricultural sector. Farm receipts include money received from the sale of livestock and crops. according to the report. Eathington said the percentage of total industrial output tracing back to agriculture was bigger than she anticipated." he said. at the request of the College of Agriculture.Is. it is all too common for outside organizations to attack Iowa agriculture. 1/28/03 (Ruth Neil [Daily Correspondent] “Iowa's fiscal reliance on agriculture is changing. signaling a lessened dependence on agriculture. according to the report. of the GSP. the amount and kind of earnings generated in agriculture and the composition of agricultural sales. Unfortunately.6 billion in 2000. agriculture and related industries will continue to play a prominent role in Iowa's economy. what kind of impact [agriculture] does have on the economy.7 percent. the real value of farm receipts in 2000 dollars was more than $16 billion. did these industries supply a greater percentage of the GSP. Total farm receipts rose to $25 billion in 1973 and lingered near $20 billion through the early 1980s. food and kindred product manufacturing and agricultural services contributed $7.

As long as the demand remains. That has led to record farmland values and steadily increasing debt as farmers borrow money to buy more land. revisions in the farm bill that would lower support payments or an increase in the dollar's value.msnbc. the health of hundreds of banks and the vitality of an agricultural industry that has been one of the nation's few economic bright spots in recent months. http://www. "We're in a very risky time. At risk are the livelihoods of thousands of farmers. concerns are mounting that American farmers could be edging toward a financial crisis not seen since the 1980s farm-economy collapse. they could find themselves in a situation reminiscent of the early 1980s when the farm economy largely crumbled.Arizona Debate Institute 2008 12 Pre-Institute Evidence State Econ DA Brink: Ag Collapse Brink: Farm-Economy collapse is around the corner. Soaring land values. which would hurt At a time of record agricultural profits. . an agricultural economist at Kansas State University. Flinchbaugh. and yet we don't seem concerned about that risk nearly as much as we should be. 04-20-08 (“Amid strong farm economy. finance the higher costs of fertilizer and seed and upgrade their equipment. Fall in demand due to subsidies cuts would crumble the farm economy. MSNBC." said Barry L. some dire signs” Associated Press.msn. Among factors that could affect demand would be a change in the federal government's policy on ethanol subsidies. But if demand falls.The potential problem. is that strong demand for corn and other grains has caused prices to reach historic highs. economists said. good times for farmers should continue. now estimated at about $6 billion a year. increasing debt and a reliance on government subsidies for ethanol production have prompted economists to warn that what some describe as a golden age of agriculture could come to a sudden end.

of Davenport.50. Department of Agriculture. "It concerns me. lived through the last two major farm economy downturns — the Depression in the 1930s and the 1980s farm crisis. and Kentucky last year." . the average price per acre of farmland has increased 67 percent in the past five years.Arizona Debate Institute 2008 13 Pre-Institute Evidence State Econ DA Brink: Ag Collapse Farm debt is increasing – creating a brink for the collapse of farm economy if demand drops MSNBC. "The longer these higher commodity prices go. or more than 30 Flinchbaugh and others said the agricultural economy bears a striking resemblance to that seen in the mid- 1970s. Debt for land is expected to rise to nearly $121 billion this year. who has written extensively on the 1980s farm crisis.8 billion.S. an $8 billion increase from last year and a new record for the fourth consecutive year. total farm debt will have increased by about $52. the nation's biggest corn producer. According to the U. 04-20-08 (“Amid strong farm economy. farm business debt is expected to reach $228 billion by the end of this year. http://www. The cash price for corn on the Chicago Board of Trade has soared from $1. The increased costs and memories of the 1980s have made him hesitant to take on debt. equipment and grain storage." Economists worry that farmers could be tempted to add debt due to the belief that high commodity prices would continue. when a seemingly insatiable demand for U. It concerns me a lot.88 a bushel in 2004-2005 and now are at around $13. coupled with the needs of more than 50 corn-reliant ethanol plants built in the last few years. Soybeans were at $5. and prices of grains are high just like the '70s." Harl. In Iowa. so have farmland values. "I guess you could say there's an awful lot of concern in the rural communities and with some of the city people. a product needed in abundance for fields repeatedly planted in corn.8 percent increase. And the USDA said from the beginning of 2003 to the end of 2008." said Danny Klinefelter. Ohio. which provided $12 billion in agricultural loans for farmers in Indiana. Grain farmer Harlan Meier. 76. the more it will draw people in to borrow heavily to buy the land and that's when things get dicey. Tennessee. as farmers strive to keep up with the increasing demand for grain. some dire signs” Associated Press. As prices have climbed. "I would think there would be a lot of cautiousness among farmers because most of the people can remember the '80s and I would think there's probably a lot of cautious people now on spending a lot of money. Even at a time of such strong prices. forcing thousands of farmers to sell out and leading to the failure of nearly 300 agricultural banks. Recent reports filed by agricultural lenders shows the government's expectations are playing out in reality."Land prices are increasing dramatically. said the key is how much debt farmers take on.S. noted in its annual report for 2007 that high crop prices "have created a much more risky and volatile agriculture economy. Farm Credit Services of Mid-America. and it appears that amount is increasing significantly. land values and farm income plunged.msnbc.msn." Harl said. a 2. Those prices have been driven up by a strong demand for corn and soybeans from countries such as China and India. The government said much of the debt is driven by the need for new machinery. crops drove up land values and farmers took advantage of their soaring equity to increase debt.86 a bushel in the 2004-2005 marketing year to the current price of about $6 per bushel. an extension economist at Texas A&M. Meier noted that farmers are paying much higher prices for seed and nitrogen fertilizer." Meier said. When federal policy changed and demand suddenly dropped.

. These benefits can only be maintained.senate. The farm bill – or the Food and Fuel Security Act – must provide a strong safety net for family farmers and ranchers and recognize the key role agriculture plays in both our food and fuel This safety net. 2007 (Ben Nelson [Nebraska's Senator] “2007 Food & Fuel Security Act” Homepage of Ben Nelson. however. If we can hold down the amount of subsidies going to support large. through strong policies that support farmers and ranchers.Arizona Debate Institute 2008 14 Pre-Institute Evidence State Econ DA Internal Lnx: US Econ depends on Ag The American economy relies on ag Nelson. however. the Senate is considering the legislation to strengthen family farms and rural communities. http://bennelson. must also include a real cap on the amount of money an operation can receive. then we will have the resources to invest in rural development programs necessary for the survival of our rural communities. This year. profitable operations.cfm) Agriculture forms the backbone of the American economy by providing inexpensive food and domestic energy sources for Americans.

American woes have fostered a global credit crunch. But others have argued that soaring energy prices. slipping to levels not seen in 3 1/2 months as the Nikkei newspaper reported that Japan's three largest banks were holding at least $44. "That said. claiming overseas victims such as Britain's Northern Rock. you have one of the healthiest banking sectors around. will be forced to downscale their lifestyles significantly in the face of falling housing values. financial crisis. financial institutions and the chairman of the Federal Reserve issued a sober assessment of the country's economic woes. In Paris and London. for example. Washington Post Staff Writers. recession. In Norway. US economy is key to global economy Washington problems at U. While Citibank and Merrill Lynch have been forced to take massive write- downs on bad U. loans.S. One camp of economists has argued that the rest of the world has to some measure "decoupled" from the U. So there is a global impact. including rising overall inflation and soaring energy prices.S.S. with fears of a contagion effect that could yet weigh more heavily on the global economy.S. consumers. where a lack of liquidity led to its nationalization by the British government in February. foreign financial institutions are heavily exposed to U.S. Financial Crisis Increasingly Infecting The Rest of the World” Anthony Faiola and Neil Irwin. lexisnexis) Fresh worries spread through world markets yesterday as a crisis of confidence battered more U.S. In Japan. assets.S.with consumers in Europe. many foreign banks are still doing very well.a mounting sense that America's financial crisis is still far from touching bottom is adding to global troubles. regulators this weekend to prop up the ailing government-sponsored mortgage giants Fannie Mae and Freddie Mac. with a full blown U. head of international economics for Merrill Lynch in London. several pension funds have significant portions of their investments in debt issued by Fannie Mae and Freddie Mac. banks are affecting pension funds in Japan as well as depositors in California -. In Japan. Of equal concern is that U. partly as investors doubted plans unveiled by U.S. rising inflation and a weakening dollar are already zapping the strength out of the world economy. the rest of the world suffers. With world capital markets interconnected as never before -. In Tokyo. 07-16-08 (“An Economy Thrown Into Turmoil. economy -.S. U. stock markets fell yesterday to their lowest levels since 2005. and an estimated 50 percent of U.2 billion in debt issued by Fannie Mae and Freddie Mac.S. Washington Post Staff Writers. Financial Crisis Increasingly Infecting The Rest of the World” Anthony Faiola and Neil Irwin. the benchmark stock index fell 2 percent. recession likely to take the wind out of the sails of global growth.S. 07-16-08 (“An Economy Thrown Into Turmoil.S. and if these prices go down. Asian powerhouses such as China and India.S." said Alex Patelis. too. "The rest of the world has accumulated U. who gobble up more foreign goods than the citizens of any other land. First." . mortgage-backed securities are held by foreign investors. lending giants. so. mortgages. have the Swiss banking giant UBS and Germany's IKB Deutsche Industriebank. rising unemployment and a possible recession.Arizona Debate Institute 2008 15 Pre-Institute Evidence State Econ DA Internal Lnx: US Econ Key 2 Global Econ US recession goes global Washington Post. lexisnexis) Global concern is mounting for several reasons. but the biggest impact is still going to be in the United States. eight towns have reported losing at least $125 million on their investments in U. U. and fast-growing Latin America potentially blunting the drag on the global economy from a U. It appeared to mark a new phase in the U.S.S.

described the response of policymakers as "quick and decisive" in putting in place temporary monetary and fiscal stimuli.Arizona Debate Institute 2008 16 Pre-Institute Evidence State Econ DA Internal Lnx UQ: US Econ Ok US is recovering from economic dip now The Main Wire. the IMF expects that growth in the United States "in the coming five to 10 years . is going to depend to an unusual degree on the strength of domestic demand growth in the U. "When we look more broadly. Lipsky said that "it would be very unusual to see the Federal Reserve raising policy rates in an environment with the unemployment rate still tending to move higher.. Growth Forecast” By Brai Odion- Esene. have been "exceedingly modest" Lipsky said." he added. "We do not expect a significant recession ." and 2% in 2009. director of the IMF's Western Hemisphere department said. With gradual healing in the financial sector." "The slack that we see emerging in the economy will tend to limit additional inflationary pressures. however. adding..S. . John Lipsky. because of the measures taken and the flexibility in the U." with real GDP "roughly flat in 2008.. recovery next year to be faster than the international experience .S. with income growth remaining "sluggish. By the second half of 2008 growth will continue to slow. "We do see the case for a vigorous response once the economy's recovery has firmly taken hold. economy to be back at "full potential" by the end of next year. Given that it is exceedingly costly to reverse the deterioration in inflation expectations once they set in. For the year as a whole." the stimulus effects waning... economy has held up well. as you would expect in a period of below trend growth. he said. the data does not point to this as a critical risk. Lipsky said.slower than usual due to financial turmoil and high commodity prices. more relatively speaking on business investment and improvements in net exports. especially in forward looking aspects. growth will remain weak in 2008 before recovering gradually next year -." Lipsky expanded further. he said.. deputy-managing director of the IMF." Anoop Singh. Lipsky said. the IMF expects the average growth rate for the United States "to be a little over 1%. this according to a top official from the International Monetary Fund. lexisnexis) The U. and the challenge of oil and commodity prices not receding quickly. economy. 06-23-08 (“Have Only Made 'Modest' Changes in IMF's 2009 U. growth in all the major industrial economies will be below trend. The IMF's concern is that in the second half of 2008.S. "We think this will help cushion the economic impact of the shocks and will provide some insurance against . In terms of the Fed acting to battle inflation.. adding that they expect the U. even with monetary and fiscal policies set to stimulate recovery. trading partners.. we anticipate that in the second half of this year. In a press briefing Friday at the conclusion of the 2008 Article IV consultation with the United States.S.S. growth will remain "relatively stagnant" into the beginning of 2009 before recovering. avoiding the "hard landings" that generally follow hard shocks." Lipsky said." The restoration of growth will be more gradual. saying that "the recovery will depend less on consumption and residential construction." The IMF expects "the U.S. asset price declines feeding through to real activity." The changes in the IMF forecast for the United States.

desmoinesregister." he was quoted as saying by The Wall Street Journal." said a Wall Street Journal report. the index . A couple of indexes that track Iowa's economy show signs of weakness: .Arizona Debate Institute 2008 17 Pre-Institute Evidence State Econ DA Non-UQ: Econ Low Now Iowa’s economy is low now due to recent flooding. Before April. media. it will feel like a recession. it could have far-reaching economic consequences.Flooding caused June's Business Conditions Index for Iowa to fall to its lowest level in two years. leaders are running out of the ammunition they have used to support the stock markets in past months. potentially becoming a self-fulfilling prophecy. 07-04-08 (“Iowa economy may get worse” Des Moines Register by Donnelle Eller http://www. which specialized in a type of mortgage that often required minimal documents from borrowers. "It's not just the company that's out of business in Cedar Rapids. Massachusetts.S. "I fear that we're sitting on a financial powder keg.S. whether we define it as a recession or not." said Ernie Goss. Des Moines Register.5 percent. Though new government efforts to help Fannie and Freddie could temporarily give markets a boost. "I don't think the Fed can shake its magic wand and right everything in the capital markets. the market and the economy remain in trouble. warns the U.htm ) California-based IndyMac. for instance."It must be defused swiftly and effectively. "It just ripples out." warned Bethune. declining house prices and rising costs of oil and food. But if investor jitters prevent them from being able to sell bonds to finance new mortgages. financial crisis. said the Some investors are beginning to think the U. grapples with sinking economy” Xinhua News Agency. This crisis of liquidity and capitalization of the government-sponsored enterprises is an unfortunate and potentially dangerous turn of events in the current U." noted a recent report in The Washington Post. Some analysts have called on the Federal Reserve and the Bush administration to take swift action to prevent the crisis from deteriorating. 07-20-08 (“No magic wand in sight as U.Iowa's Leading Indicators Index for May posted its second consecutive monthly decline. who compiles the index." Goss said. Businesses closed by flooding. factory hours worked and construction . including persistent strains in financial markets. . to 1. crops buried under water. investors are coming to grips with the fact that the big rate cuts have been made. business cycle. he added. said Goss." said Brian Bethune. an economics professor at Creighton University in Omaha.S. the Federal Reserve has offered to let the companies draw emergency loans.xinhuanet. senior Republican on the upper house's Banking Committee. a chief economist with Global Insight at Lexington. and disruptions to Iowa's rails and roads threaten Iowa's near-term economic health. noting the tipping points of economic crises are almost always more about psychology than fundamentals. but not until later this year or early next year.S. with panic over a bank's insolvency. Fannie and Freddie's woes "appeared to mark a new phase in the U. He believes that the Fed may wind up cutting rates by another half a percentage point. he said. "For many businesses. Federal Reserve chief Ben Bernanke has warned that the U. The Bush administration has urged Congress to temporarily increase lines of credit to Fannie and Freddie and to let the government buy their stock.a snapshot of economic indicators such as farm prices. "They are trying to buy time for the economy to lick its wounds and recover. US Economy is facing a recession now Xinhua. "I think the problem now is a general confidence crisis that is complicated by some global contagion that's now spreading.S.dll/article?AID=/20080704/BUSINESS/807040362/1029) Iowa's economy. became the third largest banking failure in U. which has avoided the worst of a national downturn.S. but it's also the companies that sell to the business in Cedar Rapids. and they may now have to tough it out. experts said. with fears of a contagion effect that could yet weigh more heavily on the global economy. economy continues to face "numerous difficulties". economist at investment bankers Lehman Brothers. as a housing bust and credit crunch strain financial institutions.had climbed for 14 months. could get sandbagged from widespread flooding. history days ago. It included the largest one-month decline ever recorded for the state. Shelby of Alabama." said Senator Richard C. no one seems to be able to prevent further damage to banks and other financial institutions. chief U.S. because failure to do so would risk a further meltdown of the housing and mortgage markets of proportions not seen since the Depression era. "Despite repeated intervention by the Fed and central banks and regulators world-wide." said Ethan Harris. Meanwhile.S. http://news." .

html) Since 1970. these products represent about a fifth of farm cash receipts. » Substantial cuts to farm subsidies would save taxpayers money and reduce the federal budget deficit. some high-cost farms would cut production or switch crops. planting different crops and diversifying their sources of income. Some land values would drop because one source of income (federal payments) would disappear. agriculture would continue to thrive. soybeans. Before joining Cato in 2001. food supplies would be ample. What has the public gotten for this vast outlay? Not much. Federal data shows that only 38 percent of farm households have farming as their primary as occurred in New Zealand after it repealed all its farm subsidies in 1984.Arizona Debate Institute 2008 18 Pre-Institute Evidence State Econ DA Iowa No Lnx Cutting farm subsidies wouldn’t hurt Iowa – crops would still grow/be produced » Farm households have more stable finawnces today and are better able to deal with a free market in agriculture than the past. remove agricultural trade barriers to cut food costs for families and reduce the debt load being imposed on young Americans. without subsidies. This year's farm bill gives them a chance to prove it. Social Security. vegetable and fruit producers get no direct subsidies.php?pub_id=8459) » If farm subsidies ended. CATO http://www. Food would be produced without subsidies. Edwards was senior economist on the congressional Joint Economic Committee examining tax. The proof: the rest of agriculture that manages without federal largess. and entrepreneurship issues. veal) totaled 86. A stronger and more innovative agriculture industry would emerge. Ongoing deficit spending on farm subsidies and other programs is causing large amounts of debt to be foisted on the next generation. It would save the government millions Edwards. Still. In 2005. 2007. Cutting farm subsidies wouldn’t hurt the ag industry.cato. Meanwhile. Iowa's cornfields and Kansas's wheat fields would go fallow? If subsidies vanished. They should end subsidies for well–off farmers. Roughly 90 percent of commodity payments go to farmers raising grains (wheat. farm subsidies have totaled $578 billion. corn). chicken. according to the historical tables of the U.8 billion pounds. Many farm households earn the bulk of their income from non–farm sources. He holds an M.S. pork. Democrats portrayed themselves as reformers willing to take on special interests for the benefit of average families. 09-12-07 (Robert Samuelson [] “America's Absurd Farm Subsidies” Real Clear Politics.realclearpolitics. meat. In winning the congressional elections last year.] “Ten Reasons to Cut Farm Subsidies” This article appeared on on June 28. in economics from George Mason University in Virginia. U.A. http://www. meat output alone (beef. . Does anyone truly think that. Farms would adjust. 2007(Chris Edwards [top expert on federal and state/local tax and budget issues.S. cotton and rice. budget.

He holds an M. in economics from George Mason University in Virginia. In 2005. said farmers could count on a steady 5. sometimes fetching more than $5.Arizona Debate Institute 2008 19 Pre-Institute Evidence State Econ DA Turn: Iowa & Ethanol Continued ethanol production would collapse the Iowan economy – eventually there will not be enough corn to meet such high demand The Globe and Mail (Canada) 07-23-07 ( BARRIE McKENNA “Corn again: Iowa finds salvation” Lexinexis) "Farmers have a lot more money to spend. combined with the industry's relentless consumption of government subsidies and its unquenchable thirst for power and water may trigger its undoing. turning every landowner with more than 200 acres into a millionaire on paper. vice-president of business banking at Iowa Trust & Savings Bank in Emmitsburg. Here are 10 reasons for Congress to reconsider the need for farm programs and to begin cutting them: » Farm subsidies transfer the earnings of average taxpaying families to well–off farm businesses." Critics also warn that high corn prices. In the past year. and entrepreneurship issues. Farm subsidies are welfare for the well–to–do — even millionaire farmland owners such as David Rockefeller and Edgar Bronfman receive farm subsidies. He said Poet will need to collect just about every corn cob within 50 kilometres to feed its expanded refinery." Mr. the vast majority of farm subsidies go to the largest farms.344 average for all U. 2007(Chris Edwards [top expert on federal and state/local tax and budget issues.unprecedented in a market where houses typically sell for less than $50. Wentzel said. who sits on the ethanol plant's board. but they make little sense in today's more prosperous and dynamic economy. farmland prices are up an average of 16 per cent in the past year. the average income of farm households was $79.cato. In recent years." Farm real estate has gone though the roof. Most of the United States is mired in a housing slump.500 an acre. Across Iowa. Cutting Agricultural subsidies would save $35 billion a year Edwards. Before joining Cato in on June 28. Brownlee. And yet even ethanol's biggest local households. ." agreed Rick Jones. 7-per-cent rise in farm values through much of the 1990s. such as Mr.000 an acre and generating record rents for investors.000 this year . The industry may embrace other.] “Ten Reasons to Cut Farm Subsidies” This article appeared on Examiner. Not here. or 26 percent higher than the $63. Emmitsburg saw its first house sold for more than $500. according to the Environmental Working Group.S. 2007. "Eventually the industry will have to stop building in Iowa. Farm subsidies cost taxpayers up to $35 billion annually and tie farmers in a knot of unproductive regulations. Iowa is among just a handful of states where house prices are still rising. the biggest 10 percent of farm businesses have received 72 percent of farm subsidies. worry the boom may not last. spurred by a stunning realization that there might not be enough corn in Iowa to meet the auto industry's growing appetite. good farmland has shot up as much as 60 per cent." acknowledged Mr.php?pub_id=8459) A major farm bill being debated in Congress gives policymakers a good opportunity to cut costly subsidy programs. "There won't be enough corn.A. "This whole ethanol thing is changing so fast. in Iowa or elsewhere. cheaper sources of biomass. Edwards was senior economist on the congressional Joint Economic Committee examining tax. Social Security. » Although politicians love to discuss the plight of small farmers.965. CATO http://www.000 - and the rental market is hot as newcomers move in. Most farm programs originated in the Great Depression of the 1930s. Local real estate agent Mike Wentzel of Farmers National Co. "I never thought in my wildest dreams we'd see land at $4.

evidence has mounted that.S.Arizona Debate Institute 2008 20 Pre-Institute Evidence State Econ DA No Internal Lnx Small businesses are the backbone of the US economy – NOT ag Reuters." said Weldon Gibson. 07-20-08 (Nick Carey [] “Credit seen drying up for small business” http://uk. According to U. in 2002 the United States had 112 million paid employees.S. Tighter credit could not only help to push the United States into recession." Small businesses are a linchpin of the U. worked at companies with fewer than 500 employees.S. a consultant at the Lamar University Small Business Development Center in Texas. housing crisis and the shock waves this has sent through the financial As losses mount at American banks and the pain of the credit crisis spreads from housing and finance to the broader economy. "In recent weeks we've seen banks becoming more cautious and the pace of lending has slowed considerably.4 million of them. About 56. or just more than 50 percent. . many small companies face a tough time getting loans. small business representatives warn. In the wake of the U. Census Bureau data. "They are demanding higher credit scores and want more collateral before lending. but prolong the downturn as ideas for new businesses get stymied once entrepreneurs sit down with local bank managers. many small companies complain it is increasingly difficult to obtain loans. economy because they form the backbone of the country's jobs market and are crucial for job creation. as well as facing the strains of a weak economy and the pain of high fuel costs.reuters.