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projects and fertilizer runoff. "We have raped the land," Gorbachev himself was quoted saying earlier this year.

Casting a long shadow over farm efficiency is the stifling bureaucracy. "We struggled against private monopoly," said Soviet political economist Nikolai Schmelyov, "and got state monopoly. How can we organize competition in fertilizer and tractor manufacturing when we have three million professional supervisors?" Traveling through Russia with Yuri showed me how deeply entrenched and how dominant at the local level is the system Mikhail Gorbachev confronts.

Specialists-tractor drivers, breeders, carpenters and milkers-did the heavy work, carrying out commands from budgeters and coordinators and a hundred other officials in offices on the farms. in local and regional headquarters, and finally back in Moscow at the big superagency, Gosagroprom.

16

The bureaucracy was spoofed in a

Russian joke I heard there: "You can tell me now," says Boris, a retired Soviet spy, while sipping vodka with John, a retired American spy, "Chernobyl didn't the CIA make it blow?"

"No," answers John, "but we did invent Gosagroprom."

In a hundred fields and barns I witnessed Gosagroprom's poor results. How the Soviet Union's frustrated farm directors function at all is hard to imagine. The best workers drift away to cities, while the worst slackers stay. They work with mediocre tractors for which no spare parts arrive, although poor seed and wrong fertilizer do.

Many on-farm problems originate beyond the farm fences, in the skimpy infrastructure that leaves farms without the basic support services to be found in every Midwestern farm town. I watched a beefy machinist near Krasnodar grinding a homemade tractor gear he'd spent a day fabricating.

Near Gorbachev's home farm, I walked into a cornfield (while my KGB

consort shouted, "Halt, it is forbidden to go there!") and counted just one ear of corn for every 50 pale stalks. We passed grain mountains rising in open storage yards. After a rain, another farm's Don 1500 combines-the latest from the Russian combine monopoly-bogged down in mud while a lighter Finnish combine kept working.

Driving in Stavropol, we saw grain pouring from the unlaced tarpaulin of a transport. In line with Stalin's fear of letting peasants keep control of the grain they grow, officials insisted it was more efficient to dry and store grain far from the farms. Economist Lishchenko explains that, "In reality the grain frequently stays on the farm and gets wet. Multiply this by many farms and many years; it is a big error. Sometimes we've had 40 million tons on the ground. Officials' secrecy was not only from the people, but from the leaders."

Dr. Pyotr Goncharov, director of the Siberian Research Institute of Plant

FARM JOURNAL/AUGUST 1989

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Breeding and Selection, says. "We use vast amounts of grain inefficiently, feeding animals. Half our feed is fed unprocessed, to animals not genetically efficient by world standards We feed 150 million metric tons annuallytwice what we'd need if we did it right." Goncharov's openness was typical. Among the bureaucrats were some sincere officials, long frustrated and under no illusions about what was wrong

Perestroika's best short-terin weapon against such economic chaos is still considered experimental They have built into a few organizations-known as "Agro-Industrial Combinats"-what the nation's infrastructure lacks Viktor Postnikov came closest of any one I encountered to a Western bisnessman. In the Soviet Union, wherever one finds such an exception to the norm, one next hunts up the protector. Postnikov grew up with Gorbachev Now director general of the Stavropol Broiler Complex, he has assembled a conglomerate including several research stations, doz

FARM JOURNAL/AUGUST 1989

ens of chicken farms, six processing plants and a string of local retail shops.

"We need no ministry, no Gosagroprom," Postnikov told me. "I fought in World War II, had bad legs ever since. But I've lost more health fighting Russian bureaucracy. Since '87, we have the right to engage in foreign trade, one of the few enterprises that can do so without permission. Hard currency comes directly into our account."

Gorbachev has proposed a new reform program. It calls for more selfmanaged farm units, more food processing capacity, for letting the worst farms go bankrupt, and for shrnking the huge Gosagroprom organization.

Behind the apartment houses and cottages in farm settlements, I saw peasants' plots Averaging about % acre, they were the best manicured ground on farms. On less than 3% of Soviet farmland, peasants raise about 30% of Soviet milk, meat, eggs and vegetables and 60% of potatoes and fruit. Only on private plots do people work hard to grow what they wish, consuming most of it, selling just 12% at market prices.

The work we saw on collective fields proceeded at a drearier pace. What saddened me most was how few opportunities I saw for most people to do work proudly. Over the past few decades farm officials have searched, like stubborn alchemists, for forms of labor organization that might inspire more dedicated effort, but have been hampered by bureaucratic prerogatives and the socialist ideology of equal pay.

The newest plan for reorganizing farm work, the one Gorbachev hopes will ignite workers' dedication, is the "lease contract brigade." Small cooperative groups and families will be able to lease farmland and receive machinery from the collective farm Although they may still have to sell their crops to the state, this plan has potential to put farmers in charge of their farming.

I was shown three lease brigades Unhappily, none reminded me much of an American family farm. All were creatures of parent collective farms that still planned, budgeted and supplied them,

"Now it will be hard to

attract city people [to the farms]... the chain has been broken." -Zhores Medvedev

leaving little room for personal initiative or pride. Boards and experts dictaled their crops, planting dates, issued machines, seed and mandated marketing plans and prices.

Workers did schedule chores themselves. And wage caps were gone, so high pay was in the offing. Extraordinary expenses such as repair were deducted from gross income, which promoted careful machine operation And the family units that ran them hoped to work the same land every yearalthough the leases ran five years, not the 50 years that Gorbachev had urged.

Even if the local authorities suddenly permitted lease farmers to work unsupervised, there are probably too few real, broadly competent farmers, and not enough support services, for them to run efficiently.

As Zhores Medvedev, the exiled Soviet historian, said to me, evaluating Gorbachev's initiatives, "The plan is rational, but I don't see family farming emerging as a broad movement. This could have worked 20 years ago, when farmers still lived in rural areas. Now it will be hard to attract city people, even if they get 50-year leases, because they can't milk a cow and don't have the psychology. These things were passed on by each generation for hundreds of years, but the chain has been broken."

Others are more hopeful Gorbachev has, at least on paper, slayed the monster agricultural superagency Gosagroprom that he created when he was the chief Soviet agricultural minister.

Subsidies still prop up grossly inefficient farming methods. "It will take time," said political economist Nikolai Schmelyov, "but with lease brgades, some of our collective farms can be livable-even competitive-if freed from the administrative pyramid. There are still 200,000 orders, decrees, official instructions. I believe in general mess-general chaos, nothing strictly regulated. Let some farms survive, some perish."

Gorbachev's political genius opened a frozen system to an exciting. difficult period of transformation I came to understand perestroika as the lighting of a bonfire on a high hill in a bleak land. a fire glimpsed from all over, recalling the troubling fact of warmth to chilled citizens even when it does not itself warm many yet If the warmth spreads, we may have to revise our views of Soviet dependence on imported grain.

Editor's Note: Mark Kramer is Writer in-Residence at Smith College and author of Three Farms: Making Milk, Meat and Money from the American Soil published by the Harvard Universi ty Press.

17

INDIANA STATE GRANGE SENTIMENTS

Farm bill should not wait till after Uruguay Round MIN as farmers should know what directions farm programs are going, so they can plant crops accordingly. We recommend to keep the 1985 farm bill, with these changes.

Small farmers says it isn't right to not have more than one small set aside plot lest than five acres. This penalizes the small farmer because if he has small fields and may have wheat and corn planted. He would not be able to set aside in each field even if these are across the fence from each other. But a large farmer takes his fences out and can have his plot anywhere. Some think the government should ease out of ag as exports increases the farming industry receives 1% of the federal budget. The farmer spends much more than they receive compared to the other government subsidies business.

Marginal ground with erosion (CPR land) should be kept in this program but be allowed to raise timber for pulp wood etc. there is a shortage of this material on this kind of land.

The Food Security Act of 1985 met its major objectives and should be kept with its current changes.

as

Swampbuster (wetland). We believe small plots of less than 1 1/2 acres should be allowed to be drained with out being penalized. There should be more flexibility in croping such as planting another crop in demand like tomatoes, pickles, canola, cats, soybeans etc. without loosing your base. At present you are forced to raise a full base with set aside or lose a percentage of it.

LISA -- needs more research on perforation rate before the rates of chemical uses can be regulated. I don't believe it is possible to eliminate them completely. We will need more testing

of wells or water source.

The Grange supports the marketing loan program as a replacement for the present commodity programs. A modified version is contained in the 85 act for cotton, rice, and honey (also for wheat & feed grains at the discretion of the Ag. Secretary.) We believe this program should be applicable to wheat, feed grains, & soybeans. In fact it could be more effective as a "Pure marketing loan.)

The market loan is a new concept for the commodity loan program by which farmers who place their crops under loan with the commodity credit corporation (CCC) would repay their loan at the original loan level, or at a level that has been determined by a set formula of domestic or world market prices, whichever is lower. The other difference between a "pure" marketing loan and the regular loan program is that a "pure" marketing loan is a recourse loan that must be paid back whereas a regular loan is a

PAGE 2

non-recourse loan the farmer can repay by abandoning the crop to the CCC as full payment.

Listed below are many of the benefits of the marketing loan program that appeal to farmers, export interests and the government:

The formula would allow United States' commodities to be competitive on the world market.

The repayment formula will maintain an adequate income support for producers.

A marketing loan will allow the market to clear by eliminating the market-interfering aspects of the current program.

But

It will reduce the need for supply management programs. when such a program is necessary, it removes the incentive for our competitors to expand their production because we will remain price-competitive, thus encouraging our competitors to share in our efforts to adjust production when surplus commodities exist.

The marketing loan will avoid the government's programs of storing surplus commodities, which become costly to store and which may ultimately reduce prices.

I feel that grain terminals should not be paid any more than the individual farmer is paid for grain storage. It is simply not fair to pay different prices for the same services.

Sincerely,

INDIANA STATE GRANGE EXECUTIVE COMMITTEEMAN
Dwight Plank

Dwight Plank

INDIANA CORN GROWERS ASSOCIATION

8770 GUION ROAD, SUITE A INDIANAPOLIS, INDIANA 46268
TELEPHONE: 317-876-9311

STATEMENT

by

DEAN EPPLEY

VICE PRESIDENT

INDIANA CORN GROWERS ASSOCIATION

before the

COMMITTEE ON AGRICULTURE

U.S. HOUSE OF REPRESENTATIVES

on

August 8, 1989

Logansport, Indiana

Indiana.

Good morning, I am Dean Eppley, a corn, soybean and canola farmer from Wabash, I am currently serving as the Vice President of the Indiana Corn Growers Association. Thank you for this opportunity to visit with you today to discuss the outlook for new farm legislation upon the expiration of the 1985 Food Security Act.

The flexibility and adaptability of the 1985 Food Security Act allowed us to successfully meet many challenges over the past five years. These ranged from drought to record grain stocks to budget reductions and others. We want to

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