Starter - Expanded States Econ DAs

8/14/2019 Starter - Expanded States Econ DAs

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Arizona Debate Institute 2008 2

Pre-Institute Evidence State Econ DATurn: Iowa & Ethanol.........................................................................................................................................................59***AFF ANSWERS TO ARKANSAS...............................................................................................................................60 Non-UQ: Arkansas Econ Low Now...................................................................................................................................61***GENERAL AFF ANSWERS........................................................................................................................................62Cutting Subsides Saves Money...........................................................................................................................................63 No Internal Lnx...................................................................................................................................................................64Internal Lnx Non-UQ..........................................................................................................................................................65 No Mpx to Cutting Subsides...............................................................................................................................................66


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Pre-Institute Evidence State Econ DA

***OHIO CORE 1NCs


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Ethanol Ohio Farm Prices 1NC [1/2]

A. Unique Link farmland prices in Ohio are rising due to ethanol demand

Gary T. Pakulski Blade Business Writer - January 30, 2008 Prices for northwest Ohio farmland shooting uphttp://www.toledoblade.com/apps/pbcs.dll/article?AID=/20080130/BUSINESS06/801300381 access 7-18-08 [nfb]Mary Meyer forked out nearly three quarters of a million dollars to enlarge hernorthwest Ohiofarm by 15 percent last

year. But with the price of crops up and demand for land high, she feels lucky to have snagged the 170-acre parcel for$4,300 an acre."I thinkprices will continue to go up as long as the grain market stays good," said the 48-year-old Ottawa residentwho has nearly doubled her family's farm to 1,500 acres since taking over in 1997 when her father died.Amid record-breaking grain prices, cropland values last year soared 11 percent in Ohio , 15 percent in Michigan,and 13 percent nationally, according to the U.S. Department of Agriculture.At $3,920 an acre, Ohio bested the Michigan average of $3,450 an acre and the U.S. average of $2,700.And in fertile areas of northwest Ohio, values are even higher . In a survey last spring, the lender Ag Credit, ofFostoria, found that top land was fetching $4,500 in several places in the region. Those places included Wood County,up 2 percent, and Henry County, up 10 percent. The figures are for land kept for farming and none converted to housingtracts.Current values probably are higher, said Bill Eirich, chief appraiser for Ag Credit."Values have gone up since spring," he said, attributing the gains to price increases for corn, soybean, and wheat since

autumn, along with land purchases as income-tax strategies.Last spring, cropland averaged $3,000 to $3,500 an acre in Hancock County, he said. But over the past three months,four farms sold at an average of $4,300 an acre there."It's like a leapfrog effect," Mr. Eirich said.Joe Newlove, a Wauseon auctioneer who specializes in agricultural property, speculated that the increases are beingdriven by rising demand for corn from producers ofthe gasoline substitute ethanol.Grain prices have been at or near record highs in recent weeks, added Jim Swartz, assistant manager of Luckey FarmersInc., an agricultural cooperative in Luckey.Wheat has been trading at more than $9 a bushel, soybeans at nearly $12, and corn at about $5.Besides ethanol production, factors include rising exports driven by the falling U.S. dollar and growing worldpopulation, Mr. Swartz explained.Despite problems in other sectors of the economy, confidence is rising among farmers, agriculture experts said.

"We're seeing farmers bidding up rent and land prices with the expectation that they will be able to grow crops

quite profitably," said Joe Logan, president of the Ohio Farmers Union, a lobbying group.

B. Cutting subsidies tanks farm prices, causing loan defaults that force a bailout of

agricultural banks

Russell L. Lamb - assistant professor in the Department of Agricultural and Resource Economics at North

Carolina State University. WINTER 2003-04 REGULATION The New Farm Economy online [nfb]HOW DO WE GET THERE?Allowing market forces to guide the New Farm Economy toward a more efficient supply chain structure would benefitconsumers and producers. But the U.S. farm economy has a 70-year history of government intervention into agriculturalmarkets through subsidies and supply management. How can we move to a market- guided New Farm Economy withthe least turmoil? Cold turkey? If the goal is to allow market forces to guide the New Farm Economy, why not endsubsidies and supply management policies today? An immediate shift to a market-forces policy might be expensivefor U.S. taxpayers. For example, farm subsidies have been tied to historical production on farm program acres.The effect has been to boost the prices that buyers are willing to pay for land. Removing farm subsidies entirely,or lowering them dramatically, could result in a decline in farmland values of as much as one-third, even in thehighly productive Midwest. Declines in farmland values could seriously disrupt rural communities . Becausefarmland purchases are often financed with considerable debt, a drop in farmland values would result in large lossesfor many agricultural banks. Such a decline could necessitate yet another taxpayer financed bailout ofagricultural banks like that of the 1980s.


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***OHIO UNIQUENESS


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UQ: Ohio Econ Up [1/2]

Ohio economy up their housing market is growing

Michelle Jarboe - covers real estate for the Cleveland Plain Dealer 7-24, 2008 Home sales fall in June, butOhio bucks national slide http://blog.cleveland.com/business/2008/07/home_sales_fall_in_june_but_oh.html

accessed 7-24-08 [nfb]Home salesin the Buckeye State rose from May to June, marking their fifth consecutive month of growth even asnational home sales slid.

Sales of new and existing homes across Ohio rose 7.6 percent last month -- but still lagged June 2007 sales by 16.4percent. That pattern was mirrored across much of Northeast Ohio, where the housing market perked upheading into summer but remained far below last summer's sales activity. One exception was Cuyahoga County, wheresales held nearly flat from June '07 to June '08.

Ohio economy stable high bond ratings prove

Business Wire 7-22, 2008 Fitch Rates $37MM Ohio Capital Facilities Bonds 'AA'; Outlook Stablehttp://www.marketwatch.com/news/story/fitch-rates-37mm-ohio-capital/story.aspx?guid={2AFFCD08-F215-4C79-B019-1940E11A5143}&dist=hppr accessed 7-24-08 [nfb]

NEW YORK, Jul 22, 2008 (BUSINESS WIRE) -- Fitch Ratings assigns an 'AA' rating to $36.8 million State of Ohio(Treasurer of State) capital facilities bonds, consisting of:--$30 million mental health capital facilities bonds, series II-2008A, and--$6.8 million cultural and sports facilities refunding bonds, series 2008A.The bonds are expected to sell via negotiation on or about July 29. Fitch also affirms the 'AA' rating on approximately$2.6 billion of outstanding appropriation bonds of the state and certain agencies. The Rating Outlook is Stable.The 'AA' rating on bonds backed by Ohio's lease appropriations reflects the state's general credit standing,sound lease structures, the broad state purposes of financed projects, and constitutional authorization for these types ofbonds. Debt service on the bonds is paid from appropriations to the relevant departments for lease payments; for themental health lease bonds, the state also pledges patient receipts, principally reimbursements from Medicaid andMedicare.Ohio's 'AA+' general obligation (GO) rating reflects its careful financial management, a demonstrated record ofmaintaining fiscal balance, and a moderate, rapidly amortizing debt burden. Fitch will continue to monitor closely thestate's challenged economic situation. The long-term erosion of manufacturing has been exacerbated by a housingmarket downturn and the weakening national economy, leading to declines in employment and clouding the state's near-term economic and fiscal outlook. The state expects to update its economic and revenue forecast in August.State fiscal management has been conservative. In response to economic weakening , in February the state loweredits revenue forecast for the fiscal 2008-2009 biennium, largely in the fiscal 2009 forecast, and instituted spending cutsand other measures to maintain budgetary balance. Actual tax revenues for fiscal year 2008 were 0.6% below thereforecast figures, led by weakening in personal income and non-auto sales taxes. Lower than forecast spendingnonetheless helped the state to achieve an ending fund balance of $808 million, or 3.8% of revenues and transfers. Fundbalance is projected to fall to $240 million at the end of fiscal 2009.

Theres a stable trend of economic growth in Ohio

JAY MILLER- government and economic development reporter 7-11, 2008 Strickland touts Ohio's

economic virtues http://www.crainscleveland.com/article/20080711/FREE/946523453/1099&Profile=1099accessed 7-24-08 [nfb]Gov. Strickland said Ohio is the only state that has grown its industrial exports every year for the last decade andthat it has led the nation in attracting new businesses , according to Site Selection magazine. Yet, he said with a littlefrustration, it is the Sun Belt states that are touted for their growth, even though that growth started from a smallereconomic base than Ohios.Were not going to match the growth rate of the states with fewer assets, he said. But we are bigger, stronger andmore prosperous.


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UQ: Ohio Econ Up [2/2]

Ohios economy is growing

Brian Hyslop - Pittsburgh Post-Gazette 7-24, 2008 Regional economy shows improvement

http://www.post-gazette.com/pg/08206/899084-28.stm accessed 7-24-08 [nfb]Despite weaknesses in parts of the housing and retail sectors, the economy in the Federal Reserve's Fourth District,which includes Western Pennsylvania, Ohio and parts of Kentucky and West Virginia, improved slightly in the earlysummer.

According to the Fed's periodic survey of regional banks, known as the "Beige Book," which was released yesterday,the regional housing industry remains weak, with no improvement expected for the remainder of the year.Home builders reported flat to declining sales, and half of the respondents to the survey said they had reduced the listprices on new homes. They also reported price increases for concrete, shingles, metal products and fuel, althoughlumber prices reportedly were stable to declining.On the other hand, most commercial builders reported that business was expanding.Bankers in the district reported that home mortgage origination was slow, with lending standards remaining very tightfor the foreseeable future.Higher costs for food and gasoline appear to be taking their toll. Grocery store managers reported that sales were flat to

declining. Auto dealers also reported that purchases of new and used cars were flat to down, the exception being fuel-efficient cars, which are "selling well." Purchases of SUVs and trucks were characterized as poor.Overall consumer spending was reported as sluggish or slowing in nearly all districts. The Fourth District was anexception to the trend, characterizing sales as stable to improving, outside of the grocery sector.Regional output by factories was largely stable during the past six weeks with manufacturers expecting a slowdown inorders during the upcoming months. Manufacturing activity declined in many other Fed Districts.Employment levels in the Fourth District were largely unchanged with the most job vacancies reported in health care,energy, steel and chemicals.

[survey is based on information supplied by the Fed's 12 regional banks collected on or before July 14]

Ohio has an award-winning economy

ODOD - Ohio Department of Development 7-23, 2008 OHIO WINS SILVER SHOVEL AWARDhttp://www.odod.state.oh.us/newsroom/releases/1944.asp accessed 7-23-08 [nfb]Columbus, OH -- Lieutenant Governor Lee Fisher today announced that the State of Ohio has been awarded a SilverShovel Award from Area Development magazine for its 2007 accomplishments in attracting new businessopportunities and supporting company expansions that create jobs. Ohio was a winner among states withpopulations of more than 10 million and the June/July edition of the magazine highlights the award."This recognition highlights the work we are doing in coordination with our partners across the state to help driveOhio's economy," said Lt. Governor Fisher, who also serves as the Director of the Ohio Department of Development."We had many important achievements in 2007 in the areas of business and industry attraction, community and urbandevelopment, and innovation and technology. The hard-work ofourcommunity and business partners is crucial tooureconomic growth and is what makes Ohio a state of great strength and promise."


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UQ: Ohio Ethanol Production Up

Ohio ethanol boosts the local and regional economy investment is up

ABC7-21, 2008 http://abclocal.go.com/wtvg/story?section=news/local&id=6278123 accessed 7-23-08 [nfb]About 65 million gallons of ethanol are produced in Leipsic every year. The plant generates more than $150million in revenue every year and the parts of the corn that aren't used for ethanol are used to feed livestock. Thecorn by-product that's used to feed livestock is another big money maker for the plant.While the ethanol produced in Leipsic is mainly used in Ohio and Michigan, plant managers say it also has a muchbroader impact.

The same company that operates the Leipsic facility plans to have two other Ohio plants up and running by the end ofthe year, one in Marion and one in Fostoria. With the two new plants, Poet has invested more than $350 million inOhio. The company was started on a family farm in the western U.S.[FYI: Leipsic is a town in Ohio, population ~2200]

Ohio is pursuing ethanol, its key to economic stability

Howard J. Siegrist - extension educator at Ohio State University Extension 7-17, 2008 Newark AdvocateFarm Science Review coming in September online accessed 7-23-08 [nfb]http://www.newarkadvocate.com/apps/pbcs.dll/article?AID=/20080717/NEWS01/807170343/1002 [nfb]# With agricultural costs increasing and grain prices soaring, managing the farm can be tricky. Enterprisebudgets, land rents and custom rates will be part ofa farm management program being offered in the FirebaughBuilding, located on Friday Avenue. Exhibits on confined animal feeding operations and OSU Extension's new livestockventilation trailer will be displayed in the Firebaugh Building.# From ethanol to wind power to hydrogen fuel cells, interest in bioenergy continues to grow. Look for a wide varietyof bioenergy topics from both Ohio State and Purdue universities during the event. The exhibits will be housed in theEnergy Education tent at Alumni Park.


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Wheat UQ/Brink

Wheat farmers are on the brink only high food prices keep farms in business

CHRIS KICK- iStockAnalyst Staff Writer 7-22, 2008 Farmers Cutting 'Quality' Wheat Crophttp://www.istockanalyst.com/article/viewiStockNews+articleid_2423691~title_Farmers-Cutting.html accessed 7-23-08 [nfb]WOOSTER -- Most of the area's wheat crop appears to be harvested, and some area farmers have already baled strawfrom the remaining stubble and planted a follow-up crop, such as soybeans or alfalfa.The National Agricultural Statistics Service reported that 99 percent of Ohio's winter wheat crop was ripe, identicalto last year. Forty-three percent of the winter wheat was harvested last week, compared to 94 percent this time last year.But mostly-sunny weather the past week has helped local farmers catch up on the harvest.Will Spreng, an agronomist and field consultant for Loudonville Farmer's Equity, which serves farmers in Wayne,Holmes and Ashland Counties, figured about 75 percent of the local wheat crop had been harvested as of Thursday.As of Thursday, Spreng figured the mill had received about 50,000 bushels of wheat. He said the quality was mostlygood, with moisture percentages between 13-18 percent.If the moisture is too high, and if the wheat is stored in a metal wagon for too long, the potential for mold is increased,he said. Spreng said if wheat must be stored for long periods of time it should be well aired, by transporting it from onewagon to another, or in some other way causing aeration."It doesn't take long for it to heat up in a wagon," said Mark Trenchard, a grain merchandiser for Town & Country Co-

Op.Trenchard figured Town & Country's Smithville location had received about 800,000 bushels of wheat as of mid-lastweek. He said the mill will probably take in more wheat this year than last year, but was unsure how much more.This year's Ohio wheat crop was forecasted to be 67 bushels per acre, an increase of 4 bushels over last year.

Most area markets are buying wheat for more than $6 a bushel, among the highest prices in at least the last 40

years. But with the cost of growing wheat on the rise, the margin of profit may not be as high as anticipated."We're not gaining anything over the last 40 years," said Clayton Arnholt, who grows wheat south of Wooster.Arnholt, who also does custom combining, said this year's crop is a good one and figured his own wheat produced 65bushels an acre, almost what the state forecasted. The market is good, he said, but increases in the cost of diesel fueland fertilizer have taken away the profit potential for him and most farmers.Several of the area's feed mills have remained open later into the night than usual, to accommodate the wheat farmersare harvesting. Trenchard said Town & Country of Mansfield has been staying open until 7 p.m., compared to thenormal closing time of 4:30 p.m.


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***TOP-LEVEL OHIO LINKS


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2NC: Ethanol Link Wall [1/2]

Ethanol is boosting land values in Ohio farmers have made the transition to corn, cutting

subsidies would cause a ripple effect throughout the region

Jim McTague - Barrons Financial Weekly, Washington Editor -December 31, 2007 Don't Bet the Farmhttp://online.barrons.com/article_print/SB119882116265055389.html?mod=b_hps_9_0001_b_this_weeks_magazine_home_top accessed 7-23-08 [nfb]YOU'VE LIVED THROUGH THE TECH-STOCK BUBBLE. The dot-com bubble. The residential-real-estate bubble.Now, get ready for the cropland bubble. - At year-end 2007, farms -- the latest count shows that the U.S. has 2,089,790-- are what Miami condos and San Diego McMansions were at year-end 2004: properties so hot that they're likely tohave a meltdown in their future. As city slickers in many parts of the nation see the market prices of their homesteadsdeflate faster than a New Year's party balloon, farmers are watching the values of their land swell by annual double-digit percentages. Nationwide, farmland prices skyrocketed 50% over the past three years, to an average of closeto $2,200 an acre through August, according to the U.S. Department of Agriculture. While that's the latest month forwhich federal data are available, there's no doubt that prices are still sprinting ahead. - Ground zero for thephenomenon could very well be Iowa, which, like a newly active volcano, sits at the center of a massive dome ofrising farm and pastureland prices stretching across America's heart and beyond, from Ohio to the Dakotas. Biddersfor Iowa farmland have become almost as eager as the politicians scurrying around the Hawkeye State desperatelystumping for next month's presidential caucuses.Mike Duffy, an economics professor at Iowa State University, calculates that the average year-end farm price in the statewill be a record $3,908 an acre -- $508 higher than the USDA's August estimate (see map). Prices will have jumped anaverage 22% this year, he estimates.THE PHENOMENON ISN'T confined to the Midwest. In some Eastern states, where residential development hassqueezed farmland supply, prices have doubled over the past five years. (The costliest U.S. farms are in Rhode Island,averaging $12,500 an acre.) And in the West, states like Montana and Wyoming have seen prices of both farm- andpastureland soar.Virginia Benz, a broker at Prairie Rose Real Estate in Steele, N.D., says that good, productive farmland is up 30% thisyear in her state, to the highest level she's seen in her 30 years in the business. Even "the poorest, most unproductiveland is selling for $600 an acre," she marvels. Some purchasers are from Minnesota, where rural land is even pricier.All bubbles have catalysts, real or perceived. The tech-stock boom was driven by the belief that technology waschanging both our lives and investment realities. And the residential-realty boom was driven by faith that interest rates

would stay very low and that the baby boomers' wealth would keep the new, second- and vacation-home markets robustfor decades.The catalysts in the farmland bubble are federal subsidies to ethanol producers and the belief that ethanol

demand will keep rising and that China's and India's new wealth will keep boosting global commodity prices.Indeed, U.S. farmers are switching to corn from other crops, curbing supplies of food grains. Nationwide, from 2002to 2007, the number of acres on which corn was planted rose 24%, to 86.1 million. And the energy bill recently signedby President Bush and strongly backed by both parties mandates that oil refiners eventually boost ethanol use as agasoline additive to 36 billion gallons a year from the current seven billion gallons.

Our link-magnitude is huge ethanol is up, and fueling the Ohio economy

ABC7-21, 2008 http://abclocal.go.com/wtvg/story?section=news/local&id=6278123 accessed 7-23-08 [nfb]

One of Ohio's biggest vegetable crops is ending up in gas tanks and a Putnam County plant helps make that happen.Northwest Ohio corn could actually help save you money at the gas pump.There are 60,000 bushels of corn grown here in northwest Ohio that are turned into ethanol at the Poet Biorefiningplant in Leipsic every day.Up to a ten-percent blend ofethanol can be used in any gas and some say, because ethanol is cheaper than gas, it'ssaving you money-- some studies show between 29 and 40 cents a gallon. It's also helping local farmers make money.

The ethanol plant has also been a big boost to the Leipsic economy. The plant employs about 45 people and somegrain elevators are adding workers because of the new plant.


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2NC: Ethanol Link Wall [2/2]

Mid-west growth from ethanol production is key to offset full U.S. recession

Economist Feb 7th 2008 The geography of recessionhttp://www.economist.com/world/na/displaystory.cfm?story_id=10650727 accessMontana and Michigan mark the divergence that lies behind America's aggregate economic figures. National statisticssuggest that the country may have already tipped into a formal recession. Output rose by only 0.6% at an annualrate in the last three months of 2007, a figure that could easily be revised down to a fall. Residential construction isplunging, house prices are dropping, consumer spending is slowing and the economy shed 17,000 jobs in January, thefirst such decline since 2003. A monthly gauge of services activity, published on February 5th, has fallen dramaticallyand now suggests recessionary conditions. The big questionparticularly for those on the presidential campaign trailis where will the pain be felt most acutely, and how far it will spread.So far, much of the misery has been concentrated in one sectorhousingand in two distinct sets of states: theindustrial Midwest and those states that saw the biggest housing bubble, particularly California, Nevada, Arizona andFlorida. These two groups are disproportionately important politically. They include many states that voted early in theprimary races. Several of them (such as Michigan and Florida) are traditionally swing states in the general election.The situation is still grimmest in Michigan, Ohio and other erstwhile manufacturing strongholds, where thesubprime bust came on top of the secular loss of factory jobs. But the most dramatic weakening has been in bubble

states. Economies that were buoyed by booming construction and soaring house prices are now being dragged down.California's mighty economy is visibly wobbling. In some cities, house prices are falling at double-digit rates and theunemployment rate has jumped from 4.8% to 6.1% in the past year, an increase twice as steep as the national trend. InLos Angeles, the weak dollar and slower consumer spending have sharply cut import-traffic through the port. Thisdownturn is not as gut-wrenching as those in the early 1990s or 2001, when core industries such as defence andtechnology suffered badly. But it is steep enough to have thrown the state's budget into disarray and derailed GovernorArnold Schwarzenegger's ambitious plans for health-care reform.In Florida, Nevada and Arizona the story is similar: plunging house prices, rising foreclosures and disproportionateincreases in unemployment. Not all is gloomy: in these states, as in the rest of America, strong global growth and theweak dollar have buoyed export industries and boosted tourism. (Orlando International Airport, the gateway to DisneyWorld, saw a record number of passengers last year.) But these positives have failed to counter the drag from housingand weaker consumer spending. Mark Zandi, chief economist at Moody's Economy.com, reckons that all four bubblestates, along with Michigan, are already in recession. Together, he points out, they make up 25% of America's GDP.

Joy on the plains and mountainsMove inland from the coasts and away from the industrial Midwest, however, and the picture, for now, looks less grim.A belt running from Texas north-west across the Great Plains and the Rocky Mountains has been doing particularlywell, thanks to soaring exports and high commodity prices. Ethanol subsidies and agflation have brought abonanza to the farm states. Agricultural exports are up almost 20% compared with 2006, while farm incomes aregrowing smartly. Extractive industries are booming. Miners find it worthwhile to dig for copper in Butte, Montana,even though the operators say it is the worst-grade ore in the world. These states now have some of the lowestunemployment rates in the country. With far less of a housing boom, they have also avoided the worst of the subprimebust.


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2NC: Lifting Subsidies Link Expansion

Lifting commodity subsidies leaves our farmers exposed to protectionism overseas, destroying Ohioand the larger Midwest economyDan Morgan - Washington Post Staff Writer - October 3, 2004 Page A03 Farm Revolution Stops at Subsidieshttp://www.washingtonpost.com/wp-dyn/articles/A2928-2004Oct2.html accessed 7-20-08 [nfb]But in one essential respect, Skogen is still deeply entrenched in the farm system of the last century. Despite bin-busting crops and

strong prices over the last four years, he relies heavily on checks from the federal government. Since 2000, his farm has received

about $158,000 from Washington under a program that gives grain, rice and cotton farmers an annual allowance ingood times and bad.Last year -- a banner year in agriculture -- the government paid farmers $6.7 billion in such "direct payments," and $5.4 billion inother types of subsidies, according to figures from the U.S. Department of Agriculture and the Washington-based EnvironmentalWorking Group. Over the past nine years, the government has paid out more than 10 times that amount in total subsidies -- a $130

billion government outlay.Skogen's situation bears witness to a persistent dilemma: Even as American farms grow bigger and more efficient, they still demandand receive financial help from the government. Their productivity is itself part of the problem, experts say, because it perpetuates acycle of bigger crops to meet growing world demand while prices per bushel or bale stay at about what they were three decades ago.

While the system benefits many huge, highly profitable farms as well as smaller producers, few in either politicalparty favor ending the flow of federal dollars that last year went to 1.8 million farmers and generated business andincome for banks, real estate brokers, businesses and local governments throughoutthe Farm Belt. Both political

parties are mindful that wheat, corn and soybean farming are vital to such presidential battleground states as Minnesota, Missouri,

Ohio and Wisconsin. Such broad-based political support has made agriculture a laggard in the movement heralded after the GOP takeover ofCongress a decade ago to reorient the economy toward unfettered markets and reduced government support. That philosophy was the

bedrock of the Republicans' "Freedom to Farm" legislation passed in 1996. But subsequent droughts, floods and market upheavals forcedCongress to back down. With passage of 2002 legislation, Congress once again embraced more generous subsidies. Those subsidies havecome under fire from fiscal conservatives, developing countries and other groups. "Farm subsidies are America's largest corporate welfare

program," said Brian Riedl, federal budget analyst for the conservative Heritage Foundation. "The majority of the payments go to large

agribusinesses, which promotes the consolidation of farms. It's the plantation effect." Developing nations, meanwhile, have refusedto participate in a new round of multinational trade talks without a pledge from the United States, Europe and otherwealthy countries to reduce their $300 billion in annual agricultural subsidies. In a case that some farm groups say could bringdown the whole subsidy system, a World Trade Organization panel recently ruled that an array of U.S. cotton subsidies -- though not thedirect payments -- was illegal. An appeal is planned. "Seventy percent of farmers aren't getting any subsidies," said Rep. Ron Kind (D-Wis.),who led a battle in 2002 to shift more money in that year's farm bill from subsidies to conservation. "I don't think that's the way to encouragediversity in our food production system." Instead of paying farmers cash, he said, the government should help them with improved health

care, more agricultural research and conservation programs.Congressional defenders of the farm program take strong issue, however. "Theso-called world market is not a freemarket by anyone's definition," said Rep. Charles W. Stenholm (D-Tex.), who played a key role inwriting the 2002 farm bill. Stenholm said he would be willing to end all farm subsidies if other countries follow suit, which is unlikely.

"As long as you have Europeans subsidizing wheat exports and marketing boards in Canada, you're going to seecontinued market influence by governments," Stenholm said. "We have the most efficient farmers in the world, butmost of them can't compete with government-imposed prices overseas."Experts agree that Congress has, in fact, made strides in breaking from the old New Deal-era farm system that strictly controlled whatfarmers planted, how much land they used and even what they got for crops.The 1996 farm bill was intended to wean farmers off decades of government price supports and directives, and allow them to plantcrops that were bringing good prices in world markets. The bill stressed supporting farm income with the cash payments unrelated towhat farmers grew, rather than having government support prices by purchasing surplus crops.The new, more flexible system brought about sweeping changes. Wheat and barley growers in the northern plains converted millionsof acres to higher-value soybeans, a crop that was not covered in the more rigid farm subsidy programs of earlier years.

But in the late 1990s, with farm prices crashing, Congress rushed back with billions of dollars in "emergency"

payments.In 2000, the payments soared to a record $27.5 billion. The 2002 farm bill continued the direct payments, but alsoimproved the "countercyclical" payments for which farmers were eligible when prices fell below certain targets: $2.63 a bushel forcorn and $3.92 a bushel for wheat.In a further show of political muscle, farm state senators a week ago attached a $2.9 billion drought, flood and "disaster relief"

provision to an unrelated spending bill. Skogen is keenly aware how this agriculture spending may look to urban dwellers, but hemakes no apologies. "From the outside, you look at it and say: Why would you give anybody more money when they have a good

year?" he said. "But it's really much broader than that . It's food security for the country, it's schools, it's county government andall the things we need out here to inhabit North Dakota."

The steady cash, he said, enables him to weather bad years, get credit from banks and constantly upgrade hisoperation in a region buffeted by the vagaries ofweather and a world economy. He used the first of two annualchecks this year to purchase the yield-measuring device for his combine.


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A2: Ohio Doesnt Get many Subsidies

Farmers downplay their reliance on subsidies. They underrate their importance to the Ohio

economy

COLUMBUS DISPATCH June 17, 2007 Cash by the acre By Monique Curet and Doug Haddixhttp://www.dispatch.com/live/content/local_news/stories/2007/06/17/Farmcash.ART_ART_06-17-07_A1_0V70K8Q.html?print=yes accessed 7-20-08 [nfb]Farmers often are reluctant to discuss their subsidies.

"I think that it's just like anybody else. You don't like to tell someone else what your paycheck looks like ," said RickBorland, program chief for production adjustment compliance for the Farm Service Agency in Ohio.Under the current farm bill, every person receiving subsidies must report adjusted gross income to the USDA. Toqualify, income from activities other than farming can't exceed an average of $2.5 million over the previous threeyears, Borland said."We need to understand that, historically, farm programs have been about production of certain commodities. It has notbeen about farmers," said Carl Zulauf, an agricultural economist at Ohio State University.The primary goal was food security, not farmer support."There's all kinds of economic evidence that (subsidies) have indeed stimulated production," Zulauf said. Forexample, the U.S. traditionally has amassed a stock of crops such as corn. That's an indication that production is being

supported by the government, because the market doesn't support large reserves.Providing steady incomeFarmers had some unexpected company in collecting agricultural subsidies: charities, churches and government.


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A2: Dairy Turn

Ohio dairy firms are on top of the technology curve and insulate themselves from rising corn

prices

Marissa Mullett - Ohio State University Extension Agent for agriculture and natural resources/community

development in Coshocton County 6-28, 2008 Dairy industry contributes millions to local economyhttp://www.coshoctontribune.com/apps/pbcs.dll/article?AID=/20080628/NEWS01/806280307/1002/NEWS01accessed 7-23-08 [nfb]On a state level, the Ohio Department of Agriculture reports that Ohio has more than 3,700 licensed dairy farms. The273,000 cows on these farms produce about 4.75 billion pounds of milk a year. These numbers put Ohio 11th in thenation for its milk production.

Dairy producers in the county and across the nation implement advances in agricultural technology and farmmanagement practices on their farms to make them more profitable and environmentally kind.For instance, there are dairy farms in Coshocton County that breed their cows using sexed semen. This technologyallows farmers to ensure that a calf will be a heifer (female) instead of male (bull). After all, heifers are the dailymoney-making part of a dairy operation.

Another farm management practice dairy producers are using on their farms is intensive grazing. This practice ischaracterized by moving animals from paddock (a small pasture area) to paddock. While the cattle graze on the foragesin one area the other areas re-grow. This lessens the dependency on regular corn consumption and preserves landquality and enhances soil productivity.


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***OHIO ECONOMY INTERNAL LINKS


19/66



2NC: Farmland Prices I/L

Subsidies are key to keep Ohio farm prices high

Ben Sutherly - Staff Writer - June 08, 2008 Coping with an uncertain economyhttp://www.daytondailynews.com/n/content/oh/story/news/special-reports/2008/06/08/ddn060808econfarminsideweb.html accessed 7-18-08 [nfb]Direct payments may inflate prices for farmland, said Carl Zulauf, an OSU agricultural economist and farm billanalyst. Despite the depressed real-estate market, value of top farmland in southwest Ohio is forecast in 2008 tobe $5,214 per acre, up 5 percent from $4,962 in 2007, according to Ohio State University.

Planting decisions have already been made, the plan shocks the market because farmers have

no ability to react

Jeffrey L. Frischkorn 7-5-2008 Farmers wither as costs growhttp://www.zwire.com/site/news.cfm?newsid=19831206&BRD=1698&PAG=461&dept_id=21849&rfi=6

accessed 7-23-08 [nfb]Northeast Ohio farmers already had done their planning and planting before the floods began, said Les Ober,program assistant for the Ohio State University Extension in Geauga County."But guys may decide to plant more corn next year, depending upon what they see happening. Farmers are nowwaiting to see what comes up out of the ground here and elsewhere," Ober said.Ramey said Ohio also has largely been spared the flooding of farmland, with just spot damage and loss."Of course if you're a farmer with flooded land, you're hurting," Ramey said.Anecdotal information and visual observations, though, do seem to suggest that more Geauga County farmers areplanting high-value corn and soybeans, Ober says."We'll probably see that once the harvest reports come outbut not until fall. It's difficult to get a good numberlocally right now," Ober said.


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Ohio Economy I/L to Economy

The agricultural economy spills over to influence all other sectors

Howard J. Siegrist - extension educator at Ohio State University Extension 7-17, 2008 Newark AdvocateFarm Science Review coming in September online accessed 7-23-08http://www.newarkadvocate.com/apps/pbcs.dll/article?AID=/20080717/NEWS01/807170343/1002 [nfb]When times are good in agriculture, everyone enjoys a good farm show, and organizers of Ohio State University'sFarm Science Review hope the overall positive vibe of the industry will carry over to this year's event, scheduled forSeptember.It is amazing where agriculture is today. We are at levels with crop prices we've never seen before, but operating underthese circumstances can be potentially overwhelming. Unfortunately, we also are operating under a cost structure thatwe never have seen before. We hope what is being offered at Farm Science Review this year, from a research, educationand exhibitor standpoint, will help farmers effectively deal with those challenges they are facing."New Days, New Discoveries" is the theme of this year's event from Sept. 16-18 at the Molly Caren Agricultural Centerin London, Ohio.Farm Science Review is sponsored by the College of Food, Agricultural, and Environmental Sciences, Ohio StateUniversity Extension, and the Ohio Agricultural Research and Development Center. It attracts more than 140,000visitors from across the country and Canada, who come for three days to peruse 4,000 product lines from 600commercial exhibitors and learn the latest in agricultural research, conservation, family and nutrition, and gardening andlandscape.Farm Science Review is still a few months away, yet exhibitor space at the show is almost sold out.The general sense we get from exhibitors is that a positive atmosphere exists in the industry, and they really arewanting to capitalize on that.

Ohio key to global economy

Edward W. (Ned) Hill - Professor and Distinguished Scholar of Economic Development at the Maxine GoodmanLevin College of Urban Affairs of Cleveland State University and Nonresident Senior Fellow of the Metropolitan

Policy Program at The Brookings Institution - October 30,2007 Northeast Ohios Economic DevelopmentChallenge http://cc.ysu.edu/neolead/NEO%20V%20Speaker%20Hill.ppt accessed 7-23-08 [nfb]Ohio is Americas economic battleground

How big is the regional economy? Think of NEO as the 15th largest metro economy in the US. Or, if we were a nation,the 37nd largest national economyIfNortheast Ohio were recognized as an economic region we would rankbehind:

* Seattle-Tacoma $158.0 billion; Phoenix-Mesa $153.2 billion; Minneapolis-St Paul- Bloomington $151.9 billionAhead of:

* San Diego-Carlsbad-San Marco $143.4 billion; Riverside-San Bernardino $133.0B* United Arab Emirates $130.8 billion, Malaysia 130.8B, and Israel $129.8B* Ohiowith a GDP of $441.6 billionwould be 19th largest economy between Netherlands and Belgium


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Ethanol I/L to Bank Bailouts

Cutting ethanol subsidies pops the farmland prices bubble, forcing a bailout of ag banksJim McTague - Barrons Financial Weekly, Washington Editor -December 31, 2007 Don't Bet the Farmhttp://online.barrons.com/article_print/SB119882116265055389.html?mod=b_hps_9_0001_b_this_weeks_magazine_home_top accessed 7-23-08 [nfb]Prices of farmland have been soaring for three years, and the market has all the markings of a bubble . Barron'sWashington Editor Jim McTague tells why you shouldn't bet the farm on the gains continuing. (Dec. 28)But the case for farmland isn't airtight.In fact, some smart money that invested in Iowa farmland in 2000 is bailing out, happy to have made a profit. Accordingto Duffy, 56% of Iowa farmland was owned by farmers from 2000 to 2005. The other 44% was owned by investors. Thesplit today is 60% farmers and 40% investors.Steve Leuthold no longer owns farmland he picked up for a song in the last bust. Leuthold, chief investment officer ofLeuthold-Weeden Investment Capital in Minneapolis, seesominous parallels between today's boom and those of the1970s and 1980s, which saw farm prices soar. In Barron's Aug. 9, 1982, issue, he wrote a cover story entitled "Grim

Reapers," which called the farmland market's top. His prediction of a 50% correction was overly optimistic; he endedup buying two Iowa farms at $600 an acre, 75% below their peak prices.THAT BOOM WAS TRIGGERED in 1972 when President Nixon signed a wheat deal with the former Soviet Unionand also improved relations with China. The subsequent rise in U.S. farm exports lasted until the Soviets invadedAfghanistan in 1979 and President Carter canceled the wheat deal in protest. This couldn't have occurred at a worsetime, coming as it did in an era of fuel shortages and gas lines, inflation and soaring interest rates. Nonetheless, farmprices continued to rise, aided by easy financing. Few saw disaster arriving...until it arrived.This time around, Leuthold sees a more moderate pullback-- 15% to 20% in three to five years -- because buyersare employing less leverage and interest rates are lower. His main concern is that the ethanol boom rests on shakyeconomic underpinnings. Without government subsidies, ethanol makes no sense, he maintains. And the subsidiescould disappear because of a backlash against costs of producing the fuel -- higher supermarket prices and huge demandon water supplies. The measure was opposed by groups representing the world's undernourished and by competingagricultural interests like the National Cattlemen's Beef Association. Big Oil dislikes the program, too, and Big Oil has

deep pockets to lobby Congress.[quotes Steve Leuthold, chief investment officer of Leuthold-Weeden Investment Capital in Minneapolis]


22/66



Bank Bailouts I/L to Economy

Farmland prices are dangerously high bank failure would cause panic and economic

collapse

FDIC Federal Deposit Insurance Corporation - 6/5/2KBanking and the Agricultural Problems of the 1980shttp://www.fdic.gov/bank/historical/history/259_290.pdfaccessed 7-20-08 [nfb]Agricultural markets severely deteriorated in the 1980s, with attendant effects on agricultural banks. The roots ofthe deterioration lay in the events of the previous decade. In the early 1970s the demand for farm commoditiessignificantly increased; the increased demand caused farm prices to grow at a much faster rate than expenses; and farmincome therefore began rising rapidly. By 1973, real farm income had reached a record high of $92.1 billion, nearlydouble the $48.4 billion of three years earlier. The combination of rising farm income and high inflation caused thevalue of farmland to escalate, while at the same time a ready availability of credit caused farm debt to rise

sharply. In the late 1970s, however, the boom period came to an end: interest rates soared after the Federal ReserveBoard tightened monetary policy to fight inflation, and changing conditions in worldwide supply and demand causedexport demand for farm commodities to decrease sharply. Real farm income fell to $22.8 billion in 1980 and to $8.2billion in 1983; and in 1981 prices for farmland began a dramatic contraction. The financial performance of bankswith a large proportion of farm loans generally coincides with the performance of the farm economy. Loandemand usually increases as farm income grows; and the volume of nonperforming loans and loan losses expandswhen the farm sector is in a downturn. The correlation between the farm economy and banks in the agricultural sectorcontinued to hold true during the 1980s. Events in the farm economy were reflected in farm bank failures in 1981 and1985: in 1981 only 1 agricultural bank was among the nations 10 bank failures, but in 1985, 62 agricultural banksfailed, accounting for over half of the nations bank failures that year. In this chapter we examine, first, the farmeconomy of the 1970s and 1980s: the history and causes of the agricultural boom-and-bust cycle of those two decades,and the degree to which forecasts accurately predicted the problems that arose. Next we survey the various nonbanksources of farm credit, and then we examine the effect the downturn in the farm economy had on the banking systemmore particularly, on institutions with sizable holdings of farm loans. Finally, we analyze financial data for agriculturalbanks and com- pare them with data for small non-agricultural banks. The Agricultural Cycle in the 1970s and 1980sAgriculture is by nature a cyclical industry. The cycle in its most simplistic form traces the following course: whencrops are plentiful, prices drop, so plantings are reduced the next year. The attendant reduction in supply then generally

causes prices to rise. The higher prices lead to increased plantings and excessive production; prices decline; and thecycle repeats itself. Obviously, external forces may affect this pattern. For example, studies conducted by Louis M.Thompson, emeritus associate dean of agriculture at Iowa State University, suggest that there is a global weather patternwhich, in his opinion, drives the economic cycle in agriculture. Or some event may alter the economic outlook,providing new opportunities for profits. When that happens, the opportunities may be seized and sometimes areoverdone to such an extent that the usual agricultural cycle is transformed into a cycle of speculative excess

followed by a reaction of crisis and panic. (Such speculative cycles have been common historical occurrences.) Inthe speculative, or manic, phase, characteristically individuals with wealth or credit employ available funds to purchasefi- nancial assets. The unsustainable prices may persist for years, but eventually they reverse themselves. Few of theparticipants in such speculative bubbles are able to anticipate re- versals perfectly and therefore cannot avoidsubstantial losses when the bubble bursts


23/66



A2: Ohio Not Key

Midwestern ag banks are vulnerable high debt and farm prices make them fragile

FDIC Federal Deposit Insurance Corporation - 6/5/2KBanking and the Agricultural Problems of the 1980shttp://www.fdic.gov/bank/historical/history/259_290.pdfaccessed 7-20-08 [nfb]

However, there may be anotherreason for the midwestern location of agricultural banking problems. The typesof crops produced in these states, such as wheat, corn, and soybeans, were greatly influenced by the export boom

of the 1970s. Consequently, the Midwest experienced unusually large increases in farm real estate prices duringthis period. For example, from 1974 through 1978, when the price of an acre of farmland nationally rose at an averageannual rate of 15 percent, in Iowa and Illinois the increase was approximately 22 percent annually. In the 1980s,declines in midwestern farmland prices were similarly dramatic. For example, after peaking in 1981, farmland priceshad fallen by 49 percent in Iowa, 46 percent in Nebraska, 42 percent in Illinois, 39 percent in Minnesota, and 38 percentin Missouri. The financial difficulties caused by these declines, coupled with the substantial debt midwesternfarmers had incurred for purchases of farmland and ma- chinery to support crop expansion during the export boom,made farmers in the region much more vulnerable than farmers in other parts of the country to the declines in

exports of wheat, corn, and soybeans, as well as to the higher interest rates of the 1980s. In summary, agricultureflourished in the 1970s: in the first half of the decade crop prices soared, farm exports escalated, and real farm incomesreached all-time highs. This prosperous environment, combined with high levels of inflation, led farm real estate values

to skyrocket. The bubble burst in the early 1980s, after monetary policy was tightened to fight inflation and, at the sametime, foreign demand for domestic agricultural products plummeted. In 1981, farmland prices began a devastatingspiral. Farm debt, which had supported the agricultural expansion and farmland speculation by almost quadruplingfrom 1970 through 1983, became a painful burden to farmers. However, by 1988, total liabilities had declined 30percent.


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***IOWA ECON 1NC


25/66



Iowa Econ Shell (1/3)

A. Iowas economy is strong now

Iowa Politics.com, 07-15-08 ( Rep. Olson: Iowa Ends Year With Strong Economy For More Information: Rep. Tyler

Olson, www.iowapolitics.com/index.iml?Article=131081)The state of Iowa ended the 2008 fiscal year on June 30 and preliminary reports from a non-partisan state agency showIowa's economy is strong with revenues exceeding expectations by about $40 million. "Despite national trends, Iowa'sstrong economy is proof that our commitment to a balanced state budget and focus on job creation is working," saidState Representative Tyler Olson of Cedar Rapids. "The state's fiscal house is in order with $620 million in our reserveaccounts and we are working with local communities and businesses to create good-paying jobs for Iowans." Accordingto the non-partisan Legislative Services Agency, Fiscal Year 2008 ended with 9.4% revenue growth. This rate ofcollections compares with the Revenue Estimating Conference (REC) estimate of 8.8%. The REC estimated that fiscalyear 2008 general fund receipts would grow by $540.2 million, from $6.138 billion to $6.678 billion. The 9.4% growthrate helped to push the growth in receipts to $580.1 million, $39.9 million more than estimated.

B. Iowas 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,http://www.allbusiness.com/finance-insurance/1124853-1.html)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 farmsreceive subsidies, the vast majority of which fall under the proposed payment cap. According to the latest data, less than 50 of 151,984 subsidyrecipients in Iowa received more than $275,000 in 2000. Kansas which, like Iowa, does not have many farms that would be affected by paymentlimitations, is not overly concerned with the amendment, said Jim Maag, president of the Kansas Bankers Association. Yet the state is caught in themiddle. "Our legislators aren't exactly crazy about the entire bill but the payment cap is not our biggest concern," said Maag. "The income provision ismore 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 overallnecessity of a bill-period. "There's no doubt we have a lot of rural banks in the state that have marginal farmcustomers. They're depending on those federal payments. If they aren't there, it will have a ripple effect, notonly on the banks, but on the entire ag community. We haven't had good weather. For the last three years, the federal subsidieshave been the salvation." The other issue threatening to stall the bill is a facet of the Senate version that limits meat processors' ownership of cattleand 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 marketand 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 debateabout 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 mostcontentious Senate races. In these three states, there is broad support for restrictions on meatpackers and a limit on payments to big farms.


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C. The agriculture industry is the backbone to the US economy a depression in the ag

community would impact the whole country

Business Wire, March 16, 2006 (Agriculture Leaders Celebrate National Agriculture Day; Washington, DC, EventsHonor the Essential Role that Agriculture Plays in America's Economy Business Wire,http://findarticles.com/p/articles/mi_m0EIN/is_2006_March_16/ai_n26797789)

National Agriculture Week's kick-off begins today with the celebration of National Agriculture Day inWashington, DC. A series of events designed to celebrate American agriculture and honor the people who work to meet our everyday needswill take place throughout the day. Leading corporations, such as Archer-Daniels Midland (NYSE:ADM) and John Deere, as well as electedofficials, government agencies and industry organizations will gather in our nation's capital to educateAmericans about the essential role of agriculture in maintaining a strong economy. To kick-off National AgricultureDay, U.S. Representative Bob Goodlatte (R-VA), Chairman of the House Agriculture Committee, spoke at an FFA rally held in front of the Capitol

building. Other events taking place today included a luncheon at the National Press Club, with keynote speaker U.S. Senator Saxby Chambliss (R-GA), Chairman of the Senate Agriculture Committee. Orion Samuelson, one of the nation's most distinguished farm broadcasters, and John Block,executive vice president and president, wholesale division of the Food Marketing Institute, will serve as masters of ceremonies today. "ADM is proudto support the Agriculture Council of America and its celebration of American farming through National Agriculture Day and National Agriculture

Week," stated Brian Peterson, ADM Senior Vice President-Corporate Affairs. "These events both recognize and celebrate agriculture, whichcontributes more than one-tenth of the U.S. economy." "John Deere has been committed to the American farmer since 1837,"said Doug DeVries, senior vice-president, agricultural marketing at John Deere. "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." National AgDay highlights the abundance provided by agriculture, the backbone of the nation's economy. More than 22million people work in the agriculture industry, and raising the American public's awareness of theimportance U.S. agriculture plays in the stability of the economy and in feeding the world is the goal of NationalAgriculture Day and National Agriculture Week, March 19-25.

D. US key to world economy

Bisseker, 2007 (Claire Bisseker, staff writer for the Financial Mail, May 18, 2007, GLOBAL ECONOMY. When theUS sneezes ..., Financial Mail, p.ln )Investors are watchful, aware that growth slowdowns are often precursors to turning points in economic activity. The

big question is whether the US weakness is a temporary slowdown - a midcycle pause as occurred in 1986 and 1995 - orthe early stage of a recession. The IMF's latest World Economic Outlook seeks to answer this question and to probewhether the rest of the world can decouple from a US slowdown or whether the tighter integration of the globaleconomy has increased the scope for spillover effects. US recessions have in the past usually coincided with significantreductions in global growth, hence the expression: "If the US sneezes, the rest of the world catches a cold."


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E. Global economic decline will bring Armageddon.

Bearden, Lt. Col, 2000. [Tom, PhD Nuclear Engineering, The Tom Bearden Website, April 25, 2000, o/l:

http://www.cheniere.org/correspondence/042500%20-%20modified.htm, Accessed 5/11/07.]Just prior to the terrible collapse of the World economy, with the crumbling well underway and rising, it is inevitablethat some of the weapons of mass destruction will be used by one or more nations on others. An interesting result thenas all the old strategic studies used to showis that everyone will fire everything as fast as possible against theirperceived enemies. The reason is simple: When the mass destruction weapons are unleashed at all, the only chance anation has to survive is to desperately try to destroy its perceived enemies before they destroy it. So there will erupt aspasmodic unleashing of the long range missiles, nuclear arsenals, and biological warfare arsenals of the nations as theyfeel the economic collapse, poverty, death, misery, etc. a bit earlier. The ensuing holocaust is certain to immediatelydraw in the major nations also, and literally a hell on earth will result. In short, we will get the great Armageddon wehave been fearing since the advent of the nuclear genie. Right now, my personal estimate is that we have about a 99%chance of that scenario or some modified version of it, resulting.


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*** IOWA EXTENSIONS


29/66



UQ: Iowa Econ Strong

Flooding in Iowa wont hurt the economy long term it will spur new activity with rebuilding

Des Moines Register, 07-04-08 (Iowa economy may get worse Des Moines Register by Donnelle Eller

http://www.desmoinesregister.com/apps/pbcs.dll/article?AID=/20080704/BUSINESS/807040362/1029)"There are growing signs of weakness," said Amy Harris, an analyst for the Iowa Department of Revenue.She expected flooding to drag down future indexes, before rebounding with the influx of disaster aid andinsurance payments. "Flooding will have a big economic cost, but it also will spur a lot of economic activityin the state," Harris said. Some industries, from homebuilders to appliance retailers, will see an immediateboost from the flooding. But Goss expected the state's economy to worsen before it improves as businessesstruggle to reopen. Iowa's economy was already beginning to wear under higher energy prices, he said.Higher diesel and natural gas costs pushed higher business operating and transportation costs. Still, Iowa'seconomy has performed better than the nation and other Midwestern states, he said. "We have seen strongertimes, but there was very little indication of recession in Iowa," Goss said.

Iowas economy is not going to go into recession any time soon - projections for 2009 look

promising

UI-University News Service, 07-08-08 (UI forecaster predicts rising income growth, the Press-Citizen,http://www.press-citizen.com/apps/pbcs.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, accordingto University of Iowa economic forecaster John Geweke. In his quarterly report delivered to the state's Revenue Estimating Committeeon Monday, Geweke said he expects personal income to grow by 5.1 percent in 2008 and 4.9 percent in 2009. Those numbers are both revised upward

from his April forecast of 4.7 percent in 2008 and 4.5 percent for 2009. Employment growth is expected to increase by .4 percent in 2008, upfrom the April forecast of .1 percent, and increase by .1 percent in 2009, down from the .2 percent forecast in April. "Income growth continuedto strengthen through 2007 and the first two quarters of 2008, and the main driver of that is commodities prices thatcontinue to go up," said Geweke, director of the Institute for Economic Research in the Tippie College of Business. He said slowemployment growth is one potential weakness in the state's economy, but it isn't slow enough to make himuncomfortable. "Looking at these numbers, I see no threat of an impending recession in Iowa," he said. Income projections are

based on state figures from the first quarter of 2008. Revenue figures are based on data through the second quarter of 2008. While theprojections do not fully account for damage sustained in the floods, tornados and storms that hit the state this spring, hedoesn't expect those catastrophes will significantly slow the Iowa economy. Economic activity related to clean-up andrebuilding typically offset whatever economic loss was caused by the natural disasters, he said.Geweke is a professor of economics in the Tippie College of Business and Harlan E. McGregor Chair in Economic Theory in theDepartment of Statistics and Actuarial Science in the College of Liberal Arts and Sciences. The Institute for Economic Researchserves Iowans as an advisory group to the Governor's Council of Economic Advisors. The council's discussions are, in turn, used bythe state's Revenue Estimating Conference in determining the official prediction of the rate of growth of tax revenues for the comingtwo fiscal years. The Board of Regents created the institute in 1975 to facilitate cohesive and continuing economic research, and toestablish a formal mechanism for providing interaction with, and economic research services to, government and industry. Eachquarter the institute produces the Iowa Economic Forecast, which contains quantitative forecasts of economic conditions and taxrevenues for the State of Iowa using the latest advances in econometrics.


30/66



Lnx: Iowa

Iowas economy is dependent on farm subsidies

Des Moines Register, 02-10-02 (Farm subsidy cap would hurt few;Only 45 Iowa operations were above limit in '00 Des

Moines Register February 10, 2002 Sunday)Currently, individual farms are limited to $460,000 in annual crop payments, although subsidies areessentially uncapped under programs that guarantee minimum revenue for certain commodities. The Des MoinesRegister used U.S. Department of Agriculture data provided by the Environmental Working Group to look at Iowa's top-100 farm payment recipientsfrom 1996 through 2000. Among that group, just 45 operations received more than the proposed cap during 2000. Even that number is likely too high

because brothers, or fathers and sons, jointly operate many of those farms. Those operators could each receive up to $275,000 in payments if theymeet certain requirements. Cook said the Register's estimate is not perfect, but probably is close. "There are a number of provisions in the amendmentthat don't track with our database," he said. "But it's a fairly small number of recipients affected." The Senate measure also tightens rules on absenteelandlords who could receive subsidy payments, as well as for those whose average income exceeds $2.5 million a year. That could affect people suchas Des Moines businessman Bill Knapp, who received $408,000 in farm subsidies from 1996 through 2000 for his various land holdings in Iowa.

Farm subsidy payments are important to Iowa's economy. The state's farmers and landowners received $6.75billion in subsidy payments from 1996 through 2000, or enough to provide every man, woman and child inthe state with a lump-sum payment of $2,300. No other state -even sprawling ones with large farms such asIllinois, Texas and California -received more money during those years.


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Lnx: Corn Ethanol Key 2 Iowa

Ethanol subsides are necessary to keep the Iowa economy strong

The Economist, 2007 (The craze for maize; Iowa's ethanol economy May 12, 2007, lexisnexis)YOU might think that the opening of a new ethanol facility in Nevada, Iowaa town of 6,700 in the centre of the statewouldbe of interest mainly to the local farmers who supply the corn that the factory turns to car fuel. You would be wrong. Investorsin the refinery include the person who delivers fuel to it, a couple of local parts-suppliers for John Deere (a big farm-equipment company) and the

local school-bus driver, among 900 or so other small investors. Like many others in the corn belt, the Nevada refinery is seen as a way forthe whole rural community to thrive by exploiting America's new craving for ethanol and the corn (maize) that is beingused to make it. Corn-based ethanol is neither cheap nor especially green: it requires a lot of energy to produce.Production has been boosted by economically-questionable help from state and federal governments, includingsubsidies, the promotion of mixing petrol with renewable fuels and a high tariff that keeps out foreign ethanol. The federal government offersethanol producers a subsidy of 51 cents per gallon (13.5 cents per litre); and a growing number of states are pushing for wider use of E85, a fuel blendthat is 85% ethanol and only 15% petrol. Since oil prices rose above $30 a barrel in 2004 (they are more than double that now), ethanol capacity has

grown especially rapidly. And although the country is experimenting with other renewable plant-based fuels of varyingfeasibility, from biodiesel to (much greener) ethanol derived from trees, the biggest boom has been in corn-based ethanol. Californiahas helped to lead the way. When the state banned the use of methyl tertiary butyl ether (MTBE) as a fuel additive after 2003, everyone had to useethanol instead to meet clean-air standards; and local refineries for the product began popping up to cash in on a state subsidy of 40 cents per gallon at

the time. Outside the Golden State, however, the states most eager to subsidise ethanol were those with golden fields of corn.Wallace Tyner, an agricultural economist at Purdue University, points out that states that had introduced subsidies early, such as Illinois, Iowa,Minnesota and Nebraska, were already building lots of ethanol factories before 2004, whereas corn-belt states without subsidies, such as Indiana and

Ohio, did not do much until oil prices rose. Since then, rural areas across the region have been swept up in the ethanol craze, withnew facilities sprouting all over corn country (see map on the next page). Iowa, in the heart of the region, already has 28ethanol refineries, producing 1.9 billion gallons of the stuff a year, nearly a third of America's total capacity. Many newfacilities and expansions of existing ones are in the works. On consecutive days in Iowa last week there were ceremonies to break ground for a newfactory in Hartley and to open a completed one in Corningwhere bad weather had grounded the Vanguard Squadron, the world's only 100% ethanol-

powered aerobatics fleet. Although agribusinesses such as Archer Daniels Midland have built many ethanol refineries, farmers' co-operatives and localinvestors have also been busily building as well. The first local groups to do so were in remoter areas where farmers could not get the best prices fortheir corn because of the high cost of transporting it to market. In Iowa, that region is the north-western part of the state, which enjoys high crop yields

but gets 25-50 cents less per bushel because it is too far from the Mississippi river barges. The same logic applied in the eastern counties of North andSouth Dakota, in south-west Minnesota and in other parts of the corn belt where getting corn to market is costly. So long as a refinery can be builtnear good rail terminals in these areas, says Ken Eriksen, who analyses transport patterns at Informa Economics, a research firm specialising in

agriculture, it is more cost-effective to convert the corn into ethanol and send that to distant markets . All this activity is benefiting rural

economies and related industries big and small. Land prices in Iowa rose 10% last year, and are still climbing. Jobs arebeing created around the factories. In places such as Lakota and Marcus, which built some of the state's first modernrefineries and have made a bundle because of high oil prices and subsidies, local investors have ploughed their profitsinto home improvements, college fees and farm equipment.


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Prosperity in Iowa is based on corn-ethanol subsidies

Morgan, 09-28-07 (Dan Morgan [a former Post reporter who specialized in agriculture, is a contract writer of the

newspaper and a fellow with the German Marshall Fund, a nonpartisan public policy institution] Corn Farms Prosper,but Subsidies Still Flow Washington Post, September 28, 2007, lexisnexis)

"That's the secret of this ethanol industry," Couser said. "It's keeping the dollars at home." In July, Pine Lake CornProcessors, the second Hardin County plant after Hawkeye's, announced profits for the previous eight months of $3,800 a share, more than the $3,250cost of the initial investment. "It's worked out better than my wildest dreams," said Pine Lake President Larry Meints, a corn grower who pushed forthe new plant after becoming fed up with hauling grain to distant elevators. The new market means corn-rich Hardin County has to import the cropeven though it grows 35 million bushels a year. The county can't supply its two ethanol refineries and its thriving pork, beef and poultry industries."Things are good here," said Howard B. Wenger, president of Iowa Falls State Bank, who reviews the balance sheets of hundreds of farmers. Heestimates that most farmers earned between $100 and $400 an acre on their 2006 crop after expenses, depending on whether they owned or rentedtheir land. That translates into profits of $100,000 to $400,000 on a 1,000-acre farm. The USDA predicts that net farm income will be $87.1 billion

this year, up nearly 50 percent over 2006. Iowa farmland values are up 18 percent in the past 12 months, according toFederal Reserve Board surveys, making millionaires on paper out of any farmers owning 200 acres free and clear. The ruralprosperity is due in large measure to billions of dollars in federal subsidies and incentives for corn-basedenergy. These include a 51-cent tax credit that gasoline manufacturers get on every gallon of ethanol they mix with their blends, and more than

$500 million in federal cash to ethanol refiners between 2001 and 2006 .

Corn-ethanol is the most heavily subsidized crop its crucial to Iowa

Lowry, 08-11-07 (Rich Lowry [writer] Iowa's Stake in Ethanol Distorts Our Politics Real Clear Politics,http://www.realclearpolitics.com/articles/2007/08/iowas_stake_in_ethanol_distort.html)Ethanol is to Iowans what marijuana is to Rastafarians: a substance that is considered quasi-holy, but only because itdelivers really good times. Presidential candidates become fanatical supporters of the corn-based fuel as soon as they begin to compete in theIowa caucuses. Before it's over, Mitt Romney might have to promise to use ethanol as pomade and Mike Huckabee -- in a naked play for the religiousright -- to baptize people in the stuff. We will produce 6 billion gallons of corn ethanol this year, on the way to meeting a mandate of 7.5 billiongallons by 2012. The Senate has passed a mandate for 36 billion gallons of ethanol by 2022, although the additional fuel is supposed to come fromsources other than corn -- so-called cellulosic ethanol, made from switchback grass and the like. When the agricultural firm Archer Daniels Midlandfirst coaxed ($$$) Congress into subsidizing ethanol a few decades ago, it was just a perversely amusing example of rank corporate welfare. Now,

with ethanol distorting markets in America and around the world, it's not so amusing anymore. Prior to the Civil War, southerners

genuflected before King Cotton. Now, we live in an era of King Corn. It is our most heavily subsidized crop. We willplant 90 million acres of it this year, up 15 percent from last year. Still, the price of a bushel of corn jumped from $2 to $3 in the pastyear, thanks to the demand for more ethanol. This is increasing the price of corn-based foods -- tortillas have become as much as twice as expensive inMexico -- and meat, poultry and dairy products, since livestock traditionally has been fed corn.
http://www.realclearpolitics.com/articles/2007/08/iowas_stake_in_ethanol_distort.htmlhttp://www.realclearpolitics.com/articles/2007/08/iowas_stake_in_ethanol_distort.htmlhttp://www.realclearpolitics.com/articles/2007/08/iowas_stake_in_ethanol_distort.html


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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, and across a growing swath of the U.S. Midwest, making ethanol has meant a second chance for a ruraleconomy that lives and breathes corn. "This town was dying a slow death," said Craig Brownlee, a third-generation corn farmer fromEmmitsburg, located 260 kilometres northwest of Des Moines. "We weren't making any money and we were living off crop subsidies. Now, peopleare spending money like they haven't in a long time. There's a buzz around town."

A vast new industry is rising out of corn fields. The ethanol refinery here, owned by Poet LLC of Sioux Falls,S.D., is one of 27 ethanol plants operating in Iowa. Another 19 are under construction or undergoing major expansions. Add to thata dozen biodiesel plants, which convert soybeans into truck fuel, and it's little wonder many farmers proudly sport "I grow oil" bumper stickers on

their trucks. Iowa has become the Texas of the ethanol industry - the heart of an industry that is now feeding thecountry's cars, not just its people and livestock. This year, more than a quarter of the Iowa corn crop will goto feed ethanol plants, up 20 per cent from last year. The state already accounts for roughly a third of the six billion gallons producednationwide, and has visions of grabbing an even larger bite. In all of Canada, there are just eight ethanol plants, producing about 185 million gallons

(700 million litres). Poet alone produces more than a billion gallons, second only to Archer-Daniels-Midland Co. If all the Iowa plants nowon the books get up and running, the largest corn-growing state in the U.S. could one day become a net crop

importer to sustain all of them. And if Iowa is the new Texas, Emmitsburg (pop. 3,867) might just be its Spindletop - the 1901 gusher wellthat launched the modern-day oil industry. It wasn't that long ago that ethanol - a 200-proof alcohol gasoline substitute - was a bit ofa curiosity in the farm belt. Farmers saw it as a way to get a few more cents a bushel for some of their crop.The scheme has worked beyond anyone's wildest dreams. Thanks to hefty government subsidies at the pump,new renewable fuel mandates and strict import restrictions, ethanol production is gushing. There are so many plantsin northwestern Iowa that most farmers are now within 50 kilometres of at least one refinery. Many Emmitsburg farmers sell nearly everything theyharvest to the refinery. More than 100 residents, including farmers such as Mr. Brownlee, have also earned small fortunes as minority investors in the

plant.For decades, the price of corn fluctuated between $2 (U.S.) and $2.50 a bushel. But thanks in large part to new demand from ethanol plants likethis one, the price of corn has nearly doubled in the past year alone. And most experts say it will stay high for some time. In Iowa, farmers weregetting an average of $3.56 a bushel in June, up from less than $2 a year ago.Across the United States, the corn price surge has put an extra $9-billioninto farmers' pockets.The Poet plant's towering silver corn storage silos, conveyor belts and fermenting tanks rise prominently out of the lush yellowand green corn fields that spread out as far as the eye can see.On a rail siding beside the plant, dozens of tanker cars wait to haul ethanol to gasrefineries as far away as the East and West coasts. A steady stream of hopper trucks drive their load of yellow gold into a double-ended unloading

building, dumping their cargo onto conveyor belts beneath the floor.Poet has big plans for Emmitsburg. The company is poised to spend $200-millionto more than double the plant's capacity to 125 million gallons, putting it among the largest ethanol refineries in the United States. And Poet thinks ithas an answer to where it will get all that corn. A quarter of the expanded plant's output will come from a newly developed cellulose process that willturn corn husks, as well as the kernels, into automotive fuel. The process will allow the company to produce 27 per cent more ethanol from an acre ofcorn, and consume less water.The expansion, dubbed the Liberty Project, earned an $80-million government grant aimed at promoting renewablefuels and weaning the United States off foreign oil.The plant's impact goes far beyond the 40 jobs the plant has already created. Poet estimates itsEmmitsburg plant pumps $60-million into the local economy every year - in corn purchases, wages and various goods and services it buys."Thatmoney turns over several times," plant manager Daron Wilson said. "It's not just the corn we buy." Like much of rural Iowa, the town had beenshrinking, as generations of young people moved away and older farmers retired. That trend has now stalled. Ben Gustafson, the ethanol plant's 28-year-old technology manager, never imagined there would be work for him in Iowa after earning a chemical engineering degree in the late 1990s."When I went to college, it was before the ethanol boom, and I just figured I'd wind up leaving Iowa to work," said Mr. Gustafson, who moved here

with his family from another small Iowa town. "To be back in my home state is pretty great." The economic ripple effects can be seenhere, and across Iowa. Emmitsburg still looks like small towns anywhere in the United States. The downtown is dominated by several emptystore fronts. But on the fringes, new businesses are opening up. Chain stores, a couple of motels, the area's first McDonald's and a large casino resort

have opened in the past two years.


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Lnx: CAFOs Key to Iowa

CAFOs are key to Iowas econmy

Payne, 01-23-07(Extension Advances Economic Development for Iowas Animal Agriculture Industry Iowa State

University Extension Extension Advances Economic Development for Iowas Animal Agriculture Industry Jack PaynesSpeech to the Iowa Feed and Nutrition Seminar)

Animal agriculture plays a key role in driving Iowas economy, particularly to benefit the states small townsand rural communities. To quote Wendy Wintersteen, dean of ISUs College of Agriculture: Developmentthrough animal agriculture is a logical and exciting avenue to grow Iowas rural economies. Our animalagriculture industry is favorably located geographically, in an area of competitive advantage for feedingredients, and has cropping systems that are compatible for manure utilization. For this reason, ISUs College ofAgriculture recently developed A Vision for Iowa Animal Agriculture. The college released the 20+page report in November, and it takes a hardlook at our current situation, opportunities, challenges, and rewards for Iowas beef, dairy, equine, pork, poultry, sheep, and goat industries. The ISUDepartment of Animal Science conducted this year long visioning process with 40 industry representatives to evaluate the current status of Iowasanimal agriculture and the opportunity for growth. We are at a time when Iowa agriculture is undergoing a vast structural change due to the biofuelsopportunity. Bringing these top people to the table could not have been more timely. The objective was to align what all these folks know about theIowa livestock sector and the economy with the new realities and possibilities. They identified some central themes and issues that exist across alllivestock species grown in Iowa. Let me share the key messages from this vision. There are nine:


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Internal Lnx: Iowa dependent on Ag

Iowas economy is dependent on agriculture

Iowa Corn Promotion Board & Iowa Corn Growers Association, 2008 (Iowa Corn, Defending Agriculture in Iowa

Homepage accessed 07/22/08 http://www.iowacorn.org/farmers/farmers_12.html)Agriculture is critical to Iowas economy. In fact, a 2003 Iowa State University report concluded that Iowas economy is3.7 times more dependent on farm and food and related production as a component of its economy than the rest of thenation. Unfortunately, it is all too common for outside organizations to attack Iowa agriculture. The Iowa Corn Promotion Boards (ICPB) growerleaders understand that profitability starts with a working environment where growers can make practical decisions about how they operate. Thatswhy ICPB has launched an educational campaign to remind all Iowans that the states economic health depends on agriculture.

Agriculture is vital to Iowas economy.

Iowa State Daily, 1/28/03 (Ruth Neil [Daily Correspondent] Iowa's fiscal reliance on agriculture is changing,Industries profit from interdependencehttp://media.www.iowastatedaily.com/media/storage/paper818/news/2003/01/28/Agriculture/Iowas.Fiscal.Reliance.On.Agriculture.Is.Changing-1093746.shtml)

Agriculture remains vital to Iowa's economy although its influence has lessened during the years, according to a new report that pullstogether statistics about the economic role of agriculture in Iowa. The most striking statistic takes into account the interdependence between

agriculture and other industries, according to the report. When combined, production agriculture, food manufacturing and otheragriculture-affiliated industries account for 24.3 percent of Iowa's total industrial output. The report wasprepared by David Swenson and Liesl Eathington, both assistant scientists in agricultural economics, at therequest of the College of Agriculture. Swenson said this means nearly a quarter of all the sale transactions that occurred in the state ofIowa happened because of agriculture. Eathington said the percentage of total industrial output tracing back to agriculture was bigger than she

anticipated. "[The report shows the] importance of the links between different sectors of Iowa's economy," shesaid. "[Many

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