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OALP Economics

For years old rural towns have shrunk as our nation's economy has shifted towards technology and away from life on the farm, but that may be changing.
OALP Economics

Oklahoma Ag Leader

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Oklahoma Agricultural Leadership Program

Show Dates

Show 1134: OALP Economics

Air date: August 21, 2011

 

Transcript

ROB:  WELL, FOR YEARS OLD RURAL TOWNS HAVE SHRUNK AS OUR NATION’S ECONOMY HAS SHIFTED TOWARDS TECHNOLOGY AND AWAY FROM LIFE DOWN ON THE FARM; BUT, THAT MAY BE CHANGING.  AS WE CONTINUE OUR CONVERSATION LOOKING AT THE ECONOMICS OF RURAL LIFE.  AND I WANT TO REALLY AIM MY FIRST QUESTION TO THE BANKERS IN THIS GROUP.  YOU KNOW, PROBABLY FEW THINGS ARE MORE CAPITAL INTENSIVE AS BIG AGRICULTURE.  WHAT IS THE ROLE, OR FROM YOUR PERSPECTIVE, WHAT IS THE ROLE BANKS PLAY IN NOT ONLY THE SUCCESS OF FARMS, THE SUCCESS OF OUR RURAL TOWNS?

KURTIS:  WELL I THINK, ROB, THAT, THAT THE BANKS PLAY A HUGE ROLE IN SERVING THE SMALL COMMUNITIES BECAUSE THEY ARE A VITAL PART OF THAT COMMUNITY, THEY HAVE AN ACTUAL INVESTMENT IN THE COMMUNITY, THEY’RE A PART OF THAT COMMUNITY AND THEY’RE, UH, MOST OF THE BANKERS, LOAN OFFICERS, LIVE IN THAT TOWN.  AND SO, THEY HAVE AN ACTIVE ROLE IN THE TOWN, AS WELL AS, SERVING THE LENDER THAT THEY WORK FOR.  AND WE’VE DISCUSSED HERE ABOUT FOR THE ENTRY BARRIERS FOR A YOUNG BEGINNING FARMER TO GET INTO FARMING; YOU KNOW, THE COST OF LAND, THE COST OF EQUIPMENT, IT IS EXTREMELY HIGH.  AND,AS A LENDER WITH FARM CREDIT, WE WORK WITH THE YOUNG BEGINNING SMALL FARMER PROGRAM THAT WE REDUCE INTEREST RATES FOR THE FIRST FIVE YEARS OR WORK THROUGH THE USDA FARM SERVICE AGENCY TO PROVIDE SOME LOWER DOWN PAYMENTS OR LOWER INTEREST RATES TO HELP US ASSIST WITH THOSE FARMERS TO KEEP THEM ON THE FARM AND KEEP THEM PRODUCING.

ROB:  MONTY, HOW ABOUT YOU?

MONTY:  UH, I AGREE WITH KURTIS AND I’LL JUST ADD, YOU KNOW, THAT AGRICULTURE IS THE LIFELINE OF ALL THESE SMALL TOWNS. YOU KNOW, WHEN IT COMES DOWN TO IT, AG IS THE, AG IS A, IS A, IS THE MAJOR PLAYER THAT DRIVES THESE SMALL TOWNS. YOU KNOW, YOU HAVE THE SCHOOL AND THE GROCERY STORE, BUT AGRICULTURE PUTS ALL THE MONEY IN TO THOSE, INTO THAT ECONOMY.

ROB:  AND RHONDA, I’D LIKE TO GET YOUR PERSPECTIVE AS SOMEONE THAT HAS VISITED THE BANKS, JUST STARTING OUT.

RHONDA REGIER:  SURE; IT IS VERY CHALLENGING.  FORTUNATELY, FOR A LOT OF YOUNG FARMERS, THEY DO HAVE FAMILIES THAT HAVE BEEN IN FARM, UH FARMING, AND THEY’RE ABLE TO WORK WITH PARENTS AND GRANDPARENTS TO GET STARTED.  AND THAT’S WONDERFUL.  BUT, THE YOUNG PEOPLE THAT ARE TRYING TO GET IN THAT DON’T NECESSARILY HAVE THAT AND ARE TRYING TO GO AND LOAN, AND BORROW THE MONEY TO BUY A FARM, OR BUY EQUIPMENT, IT’S VERY CHALLENGING.  AND, UH, EVEN BUYING, FINDING LAND AVAILABLE TO BUY IS CHALLENGING RIGHT NOW.  WITH OUR DROUGHT A LOT OF US OUR LOOKING AT DIFFERENT WAYS TO GET GRASSLAND AND WITH THE INTEREST RATES BEING SO LOW, PEOPLE THAT HAVE CD’S AND HAVE MONEY, THEY’RE, YOU KNOW, THEY’RE LOOKING AT INVESTING IT INTO LAND BECAUSE THEY CAN GET BETTER RETURNS OUT OF IT.  SO INSTEAD OF PURCHASING LAND, WE’RE RENTING LAND; AND, THAT’S KINDA WHERE WE’RE AT RIGHT NOW, BUT UH, YOU KNOW, IT’S NOT INSURMOUNTABLE, BUT IT IS CHALLENGING.

ROB:  WHEN WE RETURN, IS OUR NATION’S CAPITAL FRIEND OR FOE TO THE FARMS AND THE COMMUNITIES THEY SUPPORT.