51–60 of 391 posts
Earlier quoted context omitted.
The first thing I learned when I started working life in a store was: "We do not compete by undercutting the competition. That will kill us both."
But, corn is corn. There's no winning in a commodity market. And grain is the classic commodity.
Earlier quoted context omitted.
Is this for philosophical reasons about taxes and government? Or is it just a big chunk of money they're trying to save?
I think if anything it can be traced to a fundamental misunderstanding about how fractions work (and less glibly, basic personal finance). Choosing to spend $150,000 on things you objectively do not need in order to not have to write a $30,000 check to the IRS and put $120,000 in the bank for next year is not a rational decision for all but the most extreme anti-government/anti-tax ideologies. It's the very definitio…
In the mind of the farmer:
* $150,000 tractor: something that has value (not easy to calculate, but a $150k tractor has a value above zero, even if not brand new) and utility.
* $30,000 to the IRS: money that I will never see again. Literally thrown away money.
Option number 1 is very tempting.
I have family that farms in Iowa and I also worked in the agriculture industry there for a while after leaving the military. One thing that increases the stress on the farmers is the way they avoid income taxes at all costs so they rarely save any of the profits from good years to help them float during the bad years. This is all anecdotal but I have personally talked with several farmers that would rather buy new eq…
I'm from Iowa and a family member does lots of farm bankruptcies here. This is definitely a thing. Farmers buy new pickup trucks in lieu of showing a profit. Pair that in with land purchases at 7k+/acre and the saying "the neighbors land will never come up for sale again while I'm alive" and you've got a good mix for very high stress situations.
There was an article on HN not long ago [1] about professionals leaving their jobs in record numbers to pursue life as a farmer, producing and living off the land. How do we reconcile on the one hand farmers by trade leaving and wannabe farmers wanting to join a farm life? [1] https://news.ycombinator.com/item?id=15771168
Farmers that are killing themselves grow commodity products. The people who are leaving corporate jobs to become farmers are wanting to farm specialty products like organic products or high end products like mushrooms, flowers, wine, or specialty cheeses. The problem is that the farmers who grow commodity crops live in areas that are not suited to growing specialty crops (the middle of the country) so they can't swit…
Regardless of soil suitability, you can't just shuck off a farm worth (tens of) millions, debt on the same scale (average debt-to-assets as of 2017 is ~13% and I would expect the farmers featured here are way worse) and throw out decades of experience to try and grow mushrooms, it's unlikely that it would make your clients and creditors happy. Even less so when you're in your 50s.
There was an article on HN not long ago [1] about professionals leaving their jobs in record numbers to pursue life as a farmer, producing and living off the land. How do we reconcile on the one hand farmers by trade leaving and wannabe farmers wanting to join a farm life? [1] https://news.ycombinator.com/item?id=15771168
Earlier quoted context omitted.
I think if anything it can be traced to a fundamental misunderstanding about how fractions work (and less glibly, basic personal finance). Choosing to spend $150,000 on things you objectively do not need in order to not have to write a $30,000 check to the IRS and put $120,000 in the bank for next year is not a rational decision for all but the most extreme anti-government/anti-tax ideologies. It's the very definitio…
I agree with you that such a strategy is not optimal but it is not quite how you describe it to be. In the mind of the farmer: * $150,000 tractor: something that has value (not easy to calculate, but a $150k tractor has a value above zero, even if not brand new) and utility. * $30,000 to the IRS: money that I will never see again. Literally thrown away money. Option number 1 is very tempting.
Maybe they have been faced with the prospect of moving to a city and working in an office.
These people are in their 50-60s. That's not a likely transition. A few might be able to get into sales or traveling trade work. But most of them are going to have a difficult time finding any sort of work. Agism and the stigma of being a bumpkin/luddite will absolutely work against them.
Which is a terrible assumption to make.
Many farmers (at least here in the mid-Atlantic) are college-educated absolutely not bumpkins/Luddites. Unsurprisingly, agricultural programs have a useful blend of business/economics and science.
There was an article on HN not long ago [1] about professionals leaving their jobs in record numbers to pursue life as a farmer, producing and living off the land. How do we reconcile on the one hand farmers by trade leaving and wannabe farmers wanting to join a farm life? [1] https://news.ycombinator.com/item?id=15771168
Earlier quoted context omitted.
I think if anything it can be traced to a fundamental misunderstanding about how fractions work (and less glibly, basic personal finance). Choosing to spend $150,000 on things you objectively do not need in order to not have to write a $30,000 check to the IRS and put $120,000 in the bank for next year is not a rational decision for all but the most extreme anti-government/anti-tax ideologies. It's the very definitio…
I agree with you that such a strategy is not optimal but it is not quite how you describe it to be. In the mind of the farmer: * $150,000 tractor: something that has value (not easy to calculate, but a $150k tractor has a value above zero, even if not brand new) and utility. * $30,000 to the IRS: money that I will never see again. Literally thrown away money. Option number 1 is very tempting.