Following up on and contextualizing January's "Bill Gates Is Now America’s Biggest Owner Of Farmland" and yesterday's "Bill Gates and the NextGen FutureCow".
From Mother Jones, May 25:
Wealthy investors are snapping up large tracts of farmland—and sowing discontent.
Bill Gates, in his journey from software oligarch to philanthropist, has managed to hang on to a personal fortune worth $127 billion, making him the globe’s second-wealthiest person. As his wife Melinda French Gates’ divorce from him proceeds, it will be fascinating to see what becomes of the couple’s massive holdings of farmland. Together, the Gateses are the United States’ “largest private farmland owners,” the trade journal Land Report recently revealed. They preside over 242,000 acres nationwide, an empire of dirt worth a cool $5 billion—meaning, even one of them leaves the divorce with nothing more than the farms, that person will comfortably retain billionaire status.
The Gateses aren’t the only one-percenters with dirt in their portfolios. Over the last decade, farmland has taken off as an “asset class,” finance speak for a type of investment that Wall Street salespeople urge wealthy people to include in their well-balanced portfolios. The basic pitch: “Buy land—they aren’t making it anymore,” as the old investment saying goes.
As global population rises—and demand for land-intensive foods like meat rises even faster—the world’s cache of arable land is shrinking under pressure from sprawl, pollution, and desertification. Between 1940 and 2015, the average price of an acre of farmland increased sixfold and economists expect that trendline to steepen. As a result, financial giants Prudential, Hancock, TIAA, and UBS have all acquired substantial US farmland holdings.
So far, banks, insurance companies, and pension funds, along with individuals like Gates, own just a tiny fraction of the $2.5 trillion US farmland universe. But that could soon change, especially considering that seniors own more than 40 percent of farmland, suggesting an “impending transfer,” as the American Farmland Trust, an agriculture conservation nonprofit, noted in a recent report.
What’s happening on all this newly purchased land? It’s not like Bill and Melinda are donning overalls and mounting tractors (though together, they do own a 10 percent stake in farm-equipment behemoth John Deere); investors like the Gateses leave the farming to professionals. A spokesman for Cascade Investments, the entity that manages the Gateses’ personal fortune, declined to comment on how the couple’s farm operations are run—except to assert their devotion to sustainable agriculture.
But asset appreciation, not the public good, is the underlying goal. In March, Bill Gates appeared in a Reddit “Ask Me Anything” to promote his recently published book, How to Avoid a Climate Disaster. Asked by a participant why he had bought so much farmland, Gates responded: “My investment group chose to do this. It is not connected to climate.” In other words, wealthy investors covet farmland for the money-making possibilities, first and foremost.....
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