Science in Christian Perspective

Economic Causes of Soil Erosion 
in the United States
John P. Tiemstra
Department of Economics and Business 
Calvin College 
Grand Rapids, Michigan

From: JASA 33 (September 1981): 175-178.

We youngsters pointed out that the tops of our rises were turning clay-brown, that bushels of black dirt washed into creeks and ditches every time it rained, and that in the non-Calvinist counties the tops of the rises were black. We were told we were arguing by results, not by principles. Why, God could replenish the black dirt overnight. The tops of the rises were God's business.

Our business was to farm on Biblical principles. Like, Let everything be done decently and in good order; that is keep weeds down, plant every square inch, do not waste crops, and be tidy. Contour farmers were unkingly because they were untidy. They could not be prophetic, could not explain from the Bible how to farm....

(I)t is becoming increasingly evident that agribusiness is bringing about a situation in which soil fertility has reached its limits and is in fact declining. The high production yields of the past twenty to thirty years have been achieved to some extent at the expense of the natural soil fertility which was present. . . . A form of sterility is developing in this important area of food production which our society has come to take for granted. (Zylstra, p. 10)

Similar concerns have been expressed by Geiger, Freudenberger, and Bossi among others.

There is a tendency in this literature to attibute these abusive agricultural practices to the stupidity or venality of contemporary farmers. ZyIstra (p. 10) claims that the cause is the profit motive, pure and simple. Geiger cites inertia, custom, and shortsightedness (p. 97). Bossi blames large-scale farms, a business mentality, and speculation (p. 96). Freudenberger also discusses large size and deficiencies in farmers' perspectives (p. 137-141).

On their face, these explanations are not convincing. A firm (farm or otherwise) that is motivated by long-run profit maximization (or maximizing the firm's market value, which is the same thing) will not do so by wasting its productive physical assets. Nobody wants to own stock in a company that turns out goods year after year without ever investing in physical maintenance or replacing worn-out equipment. Such firms go bankrupt, no matter their size, and the executives lose their jobs and the investors lose their money. Similarly, we would think a person was crazy if he or she expected to minimize transportation costs by running a car for 100,000 miles, but refused ever to change the oil. That would be what is commonly called "false economy."

The assertion that farming large units leads to soil erosion also lacks economic plausibility. It is claimed that larger farms have lower production costs, and so win out in the competitive battle with smaller farms, but that the techniques used on large farms necessarily cause soil erosion. There are several problems with this argument. First, if soil erosion is counted as a cost, as it presumably would be by a long-run profit-maximizing farmer, it would seem that the advantage of the large farmer would disappear. This suggests that the cost advantage of large farms, if there is one, comes about in spite of increased soil erosion, not because of it. Furthermore, it is not clear that smaller farms are automatically more conserving of soil, Indeed, it would seem that for a farmer to practice extensive crop rotation, fallowing, maintenance of woodlands and swamps, and the raising of livestock along with crops, he/she would have to be maintaining a very large operation. No matter what techniques are used, farming involves high fixed costs, which make very small farms inefficient (Suits, pp. 16-17). Good stewardship requires that we not waste resources by maintaining farms that are too small.

I suppose that it could be true that extensive soil erosion occurs simply because farmers are unaware of the problems it causes, or of methods of dealing with it, or simply out of long-bred habit, Economists, however usually assume that people have reasons for their actions. To assume otherwise, that a whole class of people are ignorant or stupid, is patronizing at best, and not really consistent with the Christian view of mankind as bearing the image of God. Rather than impugning farmers' motives or intelligence, I believe we must try to understand the economic context in which farmers decide how much soil erosion to tolerate. It seems to me that there are a number of valid, systemic reasons for the decisions farmers make in this area.

Deciding How Much Soil Erosion to Tolerate

(1) On many farms, the quality of the soil is so good that quite a lot of erosion can take place before there is any significant adverse effect on productivity. Under this condition, it would make sense for the farmer not to undertake any erosion-preventing investments until the productivity loss from additional erosion exceeds the cost in lost productivity of preventing it. (On the increased cost of organic approach to the problem, see Oelhaf pp. 228-231.) The rate at which erosion is permitted will depend on the rate of time discount, with higher interest rates meaning faster erosion (Crosson and Frederick, p. 189). It should be noted that in this case, soil erosion is a disequilibrium situation, which would not be expected to continue indefinitely, even if economic conditions remain unchanged. The spread of conservation tillage in the 1970's (Crosson and Frederick, p. 187) and the increasing interest in all kinds of soil conservation techniques (Tucker) indicate that many American farms are for the first time reaching the point where conservation of soil pays off. As late as the middle 1960's, land prices tended not to reflect the condition of the soil (Held and Clawson, p. 265), which also supports this hypothesis.

On this view, erosion could be held to be occurring too fast for two reasons: Market interest rates that are higher than the proper social rate of time discount, and the contribution of soil erosion to air and water pollution.

It is well known that there are both biblical and general ethical reasons for thinking that market interest rates are too high to properly reflect the value of goods in the future (Tiemstra 1977, p. 101). A correct assessment of the value of maintaining God's creation and of the well-being of future generations argues for lower discount rates and hence a slower rate of soil erosion now. In this respect Freudenberger's warnings about sustainability of food production (pp. 136-138) seem apt.

The costs of air and water pollution from soil erosion are external costs, not borne by the farmer, but by society at large. They are therefore not taken into account by most farmers in their decisions about how much erosion to permit. (Crosson and Frederick p. 182). Farmers should be more sensitive to these considerations. The existence of this pollution problem also argues for some form of intervention by government to encourage soil conservation (This was one of the arguments for the founding of the USDA's Soil Conservation Service during the Dust Bowl era, Held and Clawson, Ch. 3).

(2) As any farmer will tell you, crop prices tend to fluctuate a great deal. This tends to exacerbate the erosion problem. When crop prices are high relative to their trend (as they were, for example, in 1973-74), the tendency is for farmers to maximize produc tion in the short term, often at the cost of mining the soil. (Crosson and Frederick, p. 190). This is done in the belief that output in the future will bring lower relative prices than in the present, so there is not much sense in sacrificing output now for output tomorrow This hypothesis also predicts that erosion is a disequilibrium phenomenon, with the amount of erosion rising and failing with food prices. Interest rates also matter here, since the more future revenues are discounted by the farmer, the less attractive conservation as a strategy appears to be.

There are two factors that may turn this cyclical tendency into a permanent problem. First, the uncertainty about future food prices may cause farmers to discount future revenues even more heavily than market interest rates would indicate, causing an even greater emphasis on present production at the expense of the future. Second, decisions about farming technology, made when cash is available for investment, may not be reversible quickly when crop prices fall. Farm machinery and improvements tend to be long-lived, so that once the technology is decided upon, the farmer may be stuck with it for a matter of decades (agricultural economists call this phenomenon "asset fixity" (Held and Clawson, p. 263)).

If crop price fluctuations are a major cause of soil loss, it would make sense to argue for an increased effort by government, perhaps in the context of international agreements, to try to stabilize prices of farm commodities. This sort of suggestion is a part of the calls from evangelicals and others for a New International Economic Order (Tiemstra 1979, p, 5), but its relationship to soil conservation is usually not recognized.

(3) Input choices and decisions about technology are made mostly on the basis of present and predicted input prices, in farming as in most other industries. Prior to the middle 1970's, prices on nonland inputs into farming (chemical and machinery) were falling relative to the price of land. (Remember, land prices reflected only the area available, not fertility.) Desiring to minimize costs, as any responsible businessman would, farmers used more non-land inputs, and farmed the land more intensively (Crosson and Frederick, pp. 136-155). The use of these "land-conserving" technologies economized on the use of land area per unit of current output, but at the expense of future soil fertility. Asset fixity embedded these decisions in the system for many years to come, long after it was clear that these input choices were inappropriate.

But to say that farmers were reacting to market prices is not enough-we must ask why the market seemed to give the wrong signals. It is easy enough to understand why land increases in price; as Will Rogers is supposed to have said, "They ain't making it no more." However, prices for chemical inputs most likely were too low and rising too slowly for farmers to appreciate the longterm scarcity of the natural resources, especially petroleum from which the chemicals are made. Conventional agriculture is not sustainable in part because its chemical resource base rests on exhaustible minerals, but the prices of these inputs have led farmers, and most of the rest of us, to take a short-sighted view of this problem. What farmers have done in their use of petrolcum-based chemicals is exactly analogous to what businessmen, homeowners, churches, and colleges have been doing for years when they built inexpensive, but very energy-wasting, facilities and buildings. The increased interest among farmers in soil-conserving technologies is no doubt due in part to the increased prices of oil and natural gas since 1973. The government's energy policies, if they are wisely designed and administered, may have a significant beneficial impact on the soil erosion problem. Unfortunately, the tendency is to exempt agriculture from energy-conserving programs.

Output prices also have a bearing on this thesis. Throughout the fifties and sixties, farmers became accustomed to low prices and surpluses of commodities. The long-term trend toward increased world-wide demand for food and higher prices, and the need for growing future production, may only have impressed itself on them in the last few years. Christians who write about world hunger have in mind a world in which the hungry are fed, which would increase demand and prices even more, if it were brought about. (Tiemstra, 1979, p. 5). Most farmers probably figure that poor people will not have a better situation in the foreseeable future.

(4) Land tenure obviously has an impact on decisions about soil conservation (Held and Clawson, p. 276-282). If a farmer rents land, rather than owning it, he has less interest in preserving its future fertility, and hence is more likely to mine the soil (that is, if the landlord lets him). Some Christian commentators assume that this same incentive structure is true of corporate farms, as well (Bossi, p. 96). That is probably not true. A corporate manager is judged on how well he preserves, enhances, and utilizes the corporation's assets. A manager who wastes them will be out of a job before very long. It is good, as many Christians assert, for farmers to own their own land, but a good deal of the criticism of corporate farming is misplaced.

(5) Government agricultural policy is burdened with multiple objectives, and it sometimes happens that the government's professed interest in soil conservation is undermined by policies directed at other goals. (Held and Clawson, p. 284). Acreage allotments for particular crops and land set-aside programs are designed to reduce total production and increase prices. Sometimes it is also claimed that, by increasing fallow, they also promote soil conservation. However, the response of farmers to being forced or bribed to reduce the land they have under cultivation is often to try to maximize output on their remaining land. The best land is cultivated year after year, and the worst always set aside. Intensity of cultivation increases, with the resulting increase in erosion. The government would be much better advised to concentrate on other types of policy for maintaining a high level of farm prices. Unfortunately, more direct methods for supporting prices often attract a lot of opposition from consumer-oriented political groups and politicians.

(6) Technological progress in agriculture, as in all fields, comes about because business and government undertake research and development. It makes a difference who does the R&D, however. Almost all farms are too small to undertake their own research program, so the R&D for the industry is carried out by the suppliers of chemicals and machinery, and by the USDA (Oelhaf p. 7). (Universities do quite a bit of the actual work, but they are usually funded by suppliers or USDA.) Now if you make your money by selling chemicals or machines, the temptation is for you to push farm technology in the direction of more chemicals and more machines. It is hard (though not impossible-see Tucker) to make a living telling farmers how to farm in a self-sufficient manner. To be a bit more charitable, it may not always be just profits that motivate researchers to move in this way. If you have been trained as a chemical engineer, your temptation is to try to solve every problem you come up against by inventing a chemical to deal with it, even if you have no financial stake in the outcome. The only way to counteract this tendency is for the USDA, which presumably has an interest in the long-term viability of American agriculture, to be more creative about how it spends its R&D budget, rather than just following the lead of the chemical and machinery suppliers, as it apparently has done in the past (Oelhaf, p. 231).

(7) Urbanization certainly plays a role in soil erosion. If a farmer anticipates that some time in the not too distant future his land will be converted to another use, such as housing or transportation, there is not much point in spending money or foregoing yield in order to maintain soil fertility. Fertility is not a factor in the price of land for non-farm use. In the fifties and sixties, the national trend was in the direction of urban sprawl, and unfortunately much of the best agricultural land lay in the way. Cities were established where the people were, and in the nineteenth century, the people were where the best land was. Economic trends in the seventies have slowed urban sprawl considerably. Increasing transportation and energy costs and slower population growth have lead to a declining demand for additional urban land. Nevertheless, many state governments are moving toward more comprehensive land-use planning, partly for the sake of preserving farms. This trend has been endorsed by some Christian commentators (see e.g. De Witt, Schaddelee), and deserves our continued interest and support.

In summary, we have found that many Christians who are concerned about world hunger have identified soil erosion as a major obstacle to solving the world food problem over the long run. For the most part, their recommendations have focussed on changing the behavior of farmers. While it is certainly appropriate to draw attention to the problems connected with conventional American farming practice, farmers can hardly be faulted for trying to produce food at the minimum possible economic cost, and for trying to provide a decent living for their families. Indeed, it may be counterproductive to accuse farmers of willfully destroying the economic base of their own industry. We have identified a number of areas in which public policy could make a more positive contribution to the long-run health of American agriculture. It is important that much more research be done to identify empirically which of these areas offer the greatest opportunities to reduce soil erosion. It is also very important for Christians to be involved in working constructively to bring about these policy changes.

References

Bossi, Stephen, "The Land: Who Shall Control?", in Lutz, pp. 79-106.

Crosson, Pierre R. and Kenneth D. Frederick, The World Food Situation, Washington: Resources for the Future, 1977.

De Witt, Calvin B., "The Land Entrusted to Us," The Banner, Oct.-Nov., 1978 (three parts).

Freudenberger, C. Dean, "Managing the Land and Water," in Lutz, pp. 123-146.

Geiger, Donald R., "Agriculture, Stewardship, and a Sustainable Future," in Jegen and Manno, eds., The Earth Is the Lord's, New York: Paulist Press, 1978, pp. 99-99,

Held, R. Burnell, and Marion Clawson, Soil Conservation in Perspective, Baltimore: Johns Hopkins, 1965.

Lutz, Charles P., ed, Farming the Lord's Land, Minneapolis: Augsberg, 1980.

Oelhaf, Robert C., Organic Agriculture, Montclair, N.J.: Allanheld, Osmun & Co., 1978.

Schaddelee, Lee, "Absolute Ownership or Social Planning?" The Banner, Oct. 1, 1976, pp. 14-15.

Suits, Daniel, B., "Agriculture," in Adams, ed., The Structure of American Industry, 5th Edition, New York: Macmillan, 1977, pp. 1-39.

Tiemstra, John P,, "Energy and Christian Stewardship," Journal of the American Scientific Affiliation, Sept. 1977, pp. 99-102.

Tiemstra, John P., "Always Poor," Reformed Journal, Oct. 1979, pp. 4-6.

Tucker, William, "The Next American Dust Bowl, and How to Avert It," Atlantic, July 1979, pp. 38-49.

Zylstra, Uko, "Tending God's Garden," Reformed Journal, July 1978, pp. 9-11.