The Farm Crisis of the Nineteen Eighties

The nineteen eighties broke something in rural Iowa that has not fully healed. The crisis had been building since the early seventies, when farm commodity prices spiked, partly due to a massive U.S. grain sale to the Soviet Union in nineteen seventy-two, and Iowa farmland values soared. Bankers encouraged farmers to borrow against inflated land values to buy more land. Farmers bought. Land that had sold for a few hundred dollars an acre in the nineteen sixties was selling for two thousand, three thousand, four thousand dollars an acre by nineteen eighty-one.

Then interest rates spiked, commodity prices collapsed, and the Soviet Union stopped buying American grain after President Carter imposed a grain embargo following the nineteen seventy-nine invasion of Afghanistan. Iowa farmland values fell by more than fifty percent between nineteen eighty-one and nineteen eighty-six. Farmers who had borrowed at the peak found themselves underwater. The debt was larger than the land was worth. Banks called loans. Farms went to auction.

The human cost was severe. Farm families lost operations that had been in their families for generations. Suicides in rural Iowa rose sharply, tracked by state health officials who had never before needed to monitor such a trend in agricultural communities. The Iowa State Extension Service set up a farm crisis hotline. Neighbors gathered in muddy farmyards to block the sheriff from conducting court-ordered auctions, standing between the auctioneer and the farm in acts of collective resistance that echoed the Grange movements of a century earlier.

The farm crisis accelerated the consolidation that was already underway. Smaller operations that had survived the seventies did not survive the eighties. The farmers who bought out their neighbors at distressed prices became the large operators whose descendants farm Iowa today. The landscape looks the same. What changed was who owns it, and under what terms.