House panel considers risks of co-op buyout

The Dutch banking giant Rabobank is taking over Farm Credit Services of America, the Nebraska based cooperative that is part of the U.S. nationwide Farm Credit Services according to Land and Livestock Post News. Many in the Farm Credit Services network are worried that the sound finances of the entire institution could be endangered if member organizations can drop out and take their assets with them.

The House Subcommittee on Conservation, Credit, Rural Development and Research doesn't seem too wild about the transaction and the takeover has yet to be approved by the Farm Credit Services of America shareholders or by federal regulators. Many are insisting a law be written to prevent this kind of transaction. Of course bankers are enthusiastic about such a transaction since removing a farm lender reduces competition (of course they never say that). Moreover anyone who has followed agriculture knows that for every farm you can subdivide it into many rural homes of a much greater worth. Of course the declining importance of individual farmers has caused speculation that the Nebraska State Fair is endanger of being shut down.

because of the strong Farm Services co-op credit systems, agricultural co-ops are one of the few bright spots in co-operatives in the United States. Perhaps we are seeing the end to that.

This is one case where political pressure can be brought. I'd write any of those members on the ag subcommittee and tell them that you don't want to see this form or credit die off to farmers.


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