Biggest drought disaster ever
The U.S. Department of Agriculture just declared a state of disaster in 26 states as drought conditions intensify. Bloomberg reports that it is the biggest declaration ever by the usda:
More than 1,000 counties in 26 states are being named natural-disaster areas, the biggest such declaration ever by the U.S. Department of Agriculture, as drought grips the Midwest.
The declaration makes farmers and ranchers in 1,016 counties eligible for low-interest loans to help them weather the drought and other disasters, Agriculture Secretary Tom Vilsack said today. The usda is also changing procedures to allow disaster claims to be processed more quickly, Vilsack said. ”Agriculture remains a bright spot in our nation’s economy,” Vilsack said, adding that the government is ready to help farmers and communities “when severe weather and natural disasters threaten to disrupt your livelihood.” Moderate to extreme drought now covers about 53 percent of the Midwest, the country’s main growing region, fueling crop-price gains that are the biggest this year among the 24 commodities tracked by the Standard & Poor’s gsci Spot Index. The rallies are boosting costs for companies from McDonald’s Corp. (mcd) and Coca-Cola Co. (KO) to Archer Daniels Midland Co. (adm) and Smithfield Foods Inc.
Agriculture may currently be a bright spot for the economy because America is the world’s largest food producer, but if the drought continues much longer, agriculture may quickly turn into an economic curse. If crops wither in the field, farmers will have nothing to sell, and taxpayers will have to pick up the insurance tab. Additionally, as Bloomberg indicated, higher agriculture commodity prices are flowing through into higher food costs for consumers—the last thing that underemployed, food-stamp-addicted Americans need.
An American crop failure would also be horrendous news for the global economy. Many nations rely on American exports to feed their people. Remember the food riots of 2008? There was even limited rationing in America.
“It breaks your heart to see what’s happening,” says Republican Rep. Vicky Hartzle. Farmers need aid, she says.
Rep. Jeff Fortenberry, also a Republican, said: “We need intervention from a higher authority—rain.”
The calls for divine intervention are set to grow louder. The devastation inflicted by national disasters has soared in recent years.
If it seems like America has been under a weather curse lately, it is because it is. Read Why ‘Natural’ Disasters? to find out why food shortages are going to come to a store near you.
