Last week, a bipartisan group of lawmakers introduced the “Promoting Agriculture Safeguards and Security (PASS) Act into both houses of Congress. Another group, also bipartisan but predominantly Republican, has expressed support for the Foreign Adversary Risk Management (FARM) Act. As journalist Lela Nargi has pointed out, both of these bills are red herrings that distract from the real problem by focusing on China. In fact, the Chinese acquisition of US farmland and agribusiness is a small part of a much larger problem.
In a recent statement on his efforts to curb foreign acquisition of US farmland, Republican Senator Chuck Grassley of Iowa observed that foreign buyers aren’t the only threat to the well-being of rural communities.
“Increasingly, young and beginning farmers are competing with institutional investors, such as pension funds, endowments, and even professional athletes who are diversifying their financial portfolios with prime farmland.”
– Senator Grassley
Grassley is right on the money about that. He and Democratic Senator Tammy Baldwin got legislation passed last year that requires the USDA to do a better job of reporting on foreign farmland ownership in the US, but if it doesn’t monitor the big domestic investors, that legislation won’t do much good. We need action that goes beyond rhetoric about foreign investors because the threat of big money to take complete control of the food system and rural assets isn’t an issue of borders.
The leader of the takeover of farmland and timberland is Nuveen, the asset management subsidiary of TIAA (formerly known as TIAA-CREF), which is a for-profit company that manages retirement accounts for most employees in US Universities and colleges and many non-profits. TIAA/Nuveen is also a foreign investor in land in the US because it has taken in money from pension funds in countries like Sweden, the United Kingdom, the Netherlands, Germany, Canada, Japan, and South Korea. TIAA/Nuveen’s largest acquisitions of land are in the United States, Brazil, and Australia, and also Romania, Poland, Colombia, Chile, Colombia, Uruguay, and New Zealand.
TIAA calls itself the largest manager of farmland globally, and it claims to own a total of 3 million acres of land for farming and timber. In Brazil, it has used shell companies to try to evade laws to prevent large-scale foreign ownership, and in the U.S., it has bought up land in states where Black farmers have faced the greatest dispossession.
We need to hold US companies accountable when they misuse the money of US workers or shareholders to make acquisitions at home or abroad that put that money at risk and cause harm to the planet or violate human rights.
Corporate owners and pension funds are banned from owning farmland in 9 US states, including Iowa, but as Senator Grassley points out, wealthy individuals are also buying up land. Bill Gates is the largest individual buyer nationally, and it’s not only conspiracy theorists who are alarmed. Gates is leading a wave of other wealthy investors. TIAA and Gates both claim that their land acquisitions will benefit global food security and local communities. These claims simply aren’t true.
These kinds of acquisitions increase the concentration of landholdings and farm size, and they may lead to overproduction which is not beneficial to global food security. Smaller farms can often produce the same or more using less land (or in some cases with less intensive use of land) and provide for more livelihoods and greater benefit to local businesses and the local community.
The part where Senator Grassley is wrong, is when he blames the Conservation Reserve Program (CRP) for distorting the marketplace. It’s primarily the big outside investors that are driving up land prices. CRP programs keep the most marginal land out of production and help older farmers to restore their land and make an easier transition to passing it on to younger farmers. CRP addresses the kind of overproduction that drives basic commodity prices down too far, putting farmers elsewhere out of business, and resulting in greater price volatility and hunger crises, especially when food has to be brought in from great distances and weather events and conflict can disrupt supply chains. What is needed for food security is policies that are supportive of both fair prices and the human right to food. Key to this are policies that help farmers and their organizations invest in their own small and medium farms and get more food to local consumers and regional markets with fair prices for all.
As the UN’s International Fund for Agricultural Development stated on the eve of the gathering of the wealthy at the World Economic Forum, more food sovereignty is what is needed for local, national and global food security. TIAA/Nuveen and Bill Gates should heed this call for food sovereignty and stay out of land acquisition and away from the kind of investments which increase concentration in the food system.
Public and smaller, more dispersed, private investments in local food system infrastructure and distribution systems rather than land concentration is what will increase the resilience of our food systems and strengthen local economies and livelihoods. Policymaker action is needed because without regulation, big capital has little incentive to behave in the interests of the many. It is too easy for asset managers to resort to greenwashing and public relations ploys rather than responsible behavior.
The statement from Senator Grassley and the bi-partisan concern about foreign investors show that even in the near future there is potential for conservatives and progressives to expose the scope of the land grab by big wealth and to take the first steps toward protecting land rights for rural communities. This could help states strengthen their laws to protect farmland for the benefit of communities.
We need land to be accessible to young farmers and to rebuild rural communities and a more resilient food system. It’s important to use the 2023 Farm Bill to maintain farm conservation programs and include money for land trusts that protect local farmer access to land. We need to take real steps toward land justice for Indigenous Peoples and marginalized communities. A big step forward would be the Senate debate and passage of the 2023 Justice for Black Farmers Act sponsored by Senator Cory Booker and others.
Senator Grassley is right in hinting that we do need to restrain the hedge funds, asset managers, mega-millionaires, and billionaires from creating greater inequality and driving land prices out of reach. With regard to other real estate, last year, Senator Jeff Merkley introduced a bill that would use targeted taxes to keep Wall Street from buying up houses and driving home prices out of reach. Perhaps something similar could be proposed for absentee buyers of farmland. Congress and state governments need to take a close look at what is happening and put forward proposals for action. It’s possible that steps toward land justice could be made in this Congress, and eventually, a just transition of food systems could happen sooner than most would imagine.