Ag Policy Blog

Vilsack: Foundations Fail to See Rural America's Potential

Chris Clayton
By  Chris Clayton , DTN Ag Policy Editor
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Agriculture Secretary Tom Vilsack spoke Wednesday to the National Rural Assembly in Washington, D.C., in a question-and-answer session and expressed his frustration over the decline of private foundations investing in rural America.

"Everyone's focused on urbanization and the fact that 80% of the people live in cities and so on."

Dovetailing into Vilsack's Q & A, the rural assembly had a panel discussion about rural philanthropy. The overriding theme was that rural America is getting short-changed when it comes to grants and other funding by major foundations. Much like the secretary's message, the panelists noted a heavy emphasis among foundations to rely on demographic numbers and larger populations to try to get more bang for the buck.

As the Daily Yonder reported in its coverage of the National Rural Assembly, USDA released a study earlier this summer showing foundations nationally spent only 6% to 7% of the funds in rural America from 2005-10 while rural residents make up roughly 19% of the population.…

That USDA report from June cited foundations spent about $45 billion in 2010. Based on such spending and percentage of population in rural America, the those rural communities or aid groups are getting short-changed roughly to the tune of about $5 billion a year in potential foundation grants or support.…

Vilsack said foundations fail to grasp the role rural America is going to play "in the really big picture." He then shifted to rural America's role working on climate change.

"How is the country going to deal with climate change? Where is the sequestration going to take place -- of this carbon we are trying to remove from the atmosphere? Where is the reduction of methane going to take place, in a significant way? Answer: Rural America. So you better invest in that place because that's where a big part of your solution to a really big problem is going to come from."

He went on. "You want to have a clean-energy future? Great. Where is that clean energy going to come from? Seriously, you can't put a wind mill up in the middle of New York City. You can put a solar panel up, maybe. But where is most of the massive amounts of that clean energy going to be produced? Rural America. If you are not investing there you may not have as clean an energy future as you envisioned."

Then there is the issue of global food security, the secretary added. The good news is that global food insecurity has fallen in recent years from 1 billion people down to under 800 million. "Those numbers are going to skyrocket up as the population increases if we can't keep up in global agricultural production. There are ways that rural America is going to lead that effort."

"So, I would say to the foundation world, 'Hey, I appreciate the fact you are putting money where you think the major issues are and the problems are. Fair enough. But you know what? This is the place where the solutions are."

It's not just grant money, he said, but there are also investment decisions. Vilsack said more capital and credit are needed in rural America. He cited some recent positive investments, such CoBank's announcement last year to spend $10 billion on rural infrastructure. Still, the private sector and foundation world need to do more.

One of the problems with investment in rural America is that "rural has equated to agriculture" for most of the history of the country. "That is no longer the case and the reason is many of our farmers have become extraordinarily successful and we don't have millions and millions of people in rural America as we did 100 years ago farming. We have thousands of people (farming)."

What has been missing is finding a way to overlay a "natural resources economy" with the farm economy. That would help take advantage of the full resources of rural America. That would include local and regional food systems that help smaller farmers tap into different markets from larger commodity growers.

Vilsack highlighted the potential of environmental solutions for landowners to create extra income. "How so? Because we now know how to quantify and measure the results of conservation. We know how much carbon is sequestered in a certain conservation practice. We know how we can improve water quality by using conservation to prevent nitrates and phosphorus and so forth from getting into water, which reduces the burden of water treatment. Regulated industries need those benefits to satisfy their own environmental requirements. They can come and invest in conservation eco-system market opportunities, which we're helping to facilitate."

Vilsack said USDA had already spent $10 million and will use more funds to help establish such markets. He noted there are "literally hundreds of these markets" around the country generating hundreds of millions of dollars in income.

The secretary also cited a recent USDA study on the bio-based economy showing it is a $369 billion industry employing 4 million people.

Thus, the secretary argues there are four pillars to the rural economy: production agriculture oriented around a push to boost exports; regional or local food markets for those non-commodity producers; conservation or eco-system services; and increasing renewable, bio-based products and energy.

As his time at USDA is growing short, Vilsack called on the people at the rural assembly to carry the water on those initiatives into the next administration. When advocates for rural America go to Congress talking about funding, they should champion the different components of "the new rural economy" and not allow lawmakers to discourage the ability of other federal departments to work with USDA.

"The challenge is to make sure this doesn't go away," Vilsack said. "It can't be something a couple of us think is a good idea and then new folks come in and have a different idea. This has to be sustained."

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Jim French
9/15/2015 | 9:43 AM CDT
Thanks for highlighting this important speech, Chris.
Jim French
9/15/2015 | 9:43 AM CDT
Thanks for highlighting this important speech, Chris.
Bonnie Dukowitz
9/13/2015 | 7:06 PM CDT
So, why in the world can one not put up wind mill in New York City? This statement nails down the problem. The arrogance of the citiots thinking us rural folks are a lesser class and servants to the ?????