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Bankruptcy law is a solution to the financial problem of "owing money" but in the case of a farmer you also own the land and means of production, and bankruptcy
by throwaway2048 8y ago
Bankruptcy law is a solution to the financial problem of "owing money" but in the case of a farmer you also own the land and means of production, and bankruptcy means forced sales of it, and it effective destroys that lifestyle for you, forever (nobody is starting a farm from scratch these days).
- Waterluvian 8y agoI never thought about that part of it. As a programmer you can't really take away my means of making a living via liquidation of assets. But farmers and I imagine many other professions, this is a very different scenario. I have to think that they wouldn't want to remove someone's ability to pay their debts. But I also imagine that when you get to bankruptcy, it isn't about that anymore.
- ThrustVectoring 8y agoEligible small farmers and fishermen can go through Chapter 12 bankruptcy to restructure their payments rather than selling off the assets they need to stay self-employed.
- froindt 8y agoThe limits for Chapter 12 are quite low when you look at the consolidation of farms that's happened in the last 10 years. Corn land in Iowa runs, say, 5-10k/acre depending on quality and location. 640 acres per square mile. 3.8 million on the low end to buy one square mile...but the Chapter 12 debt limit is $4,153,150. That doesn't count the 6 figure capex for the equipment, buildings, and the 5 figure spend for seeds, It's typically at the 2-3000 acre level where farms become economically viable. It's basically impossible to go from the city to a commodity corn, pig, or cow farmer. Disclaimer: I have been involved in efforts to increase the limit. https://www.uscourts.gov/services-forms/bankruptcy/bankruptcy-basics/chapter-12-bankruptcy-basics https://www.uscourts.gov/services-forms/bankruptcy/bankruptc...