lurkette

I was listening to a story on NPR the other day about a new book (I think it's by the Skeptical Environmentalist author, Bjorn Lomborg, but I couldn't scare up the story in the NPR archives) that looks at which "global crises" have the biggest impact AND are the most tractable - the ones about which we could do something relatively quickly and easily. AIDS in Africa was one, so was treating malaria; the other one that was mentioned was ending agricultural subsidies in industrialized countries to give developing countries a fair chance to compete on the global market.

The way I understand the situation, governments like the U.S., France, Britain, etc., subsidize certain crops like corn, cotton, rice, soy beans etc., to keep the prices artificially low. This has the effect of lowering the global market price for those commodities so that growers in developing countries that could otherwise compete in the market are reduced to selling at subsistence levels, or forgoing production at all and becoming importers because it's just cheaper to buy the subsidized crops. Essentially, it turns countries that could become competitive exporters and could use agriculture as a springboard into the global economy into dependent consumers.

I know at least in the midwest of the U.S., where I grew up, agriculture is a sacred cow (no pun intended) and our government representatives will bend over backwards to protect the interests of farmers, especially now that corporate farming is the norm and they have the means to buy and sell political influence. So what will it take to get western countries to do the right thing and make their farmers compete in a truly free and fair global market?

P.S. The way I understand it, the end result for consumers won't be much different - food prices would probably not go up much, just the location of the supplier would change.

Which brings up another thorny issue for me - why does it make sense to buy, hypothetically, apples from Chile when there are plenty of American apples being exported to, say, Japan? Wouldn't it be just a lot more efficient to skip the global trade for commodities that can be obtained locally? I understand shipping stuff that can't be grown in your climate, but it seems like we import stuff from one country just to export ours to some other country. Why not just keep our own apples and let Japan (who has no apples) buy from Chile? Otherwise it seems like we're just trading apples for apples at great cost of energy and manpower. Makes no sense to me.

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alansmithee

International agriculture is a tricky subject. For one thing, prices aren't all being kept artificially low-many are kept artificially high to support the smaller farms. If left to their own devices. many markets would be flooded with agriculture goods and the prices would fall horribly.

Also, one of the reasons that we import many of the same ag goods we export is because of trade agreements and attempts to manage markets.

Ustwo

My recomendation is to not fuck with it in what 'seems' right when it comes to shipping. Do you think that the sellers WANT to pay for global shipping unless there is a good return? My guess is we buy apples from Chilie because its growing season is different than the U.S.'s, so the US gets fresh apples out of season. We send apples to Japan because we grow a shitload of apples and the Japanese can't grow them very well. As such they have a much higher price in Japan which makes the massive shipping costs worth it.

While I wouldn't mind seeing a total free market for agriculture, most countries would not be happy with this. The areas where agriculture is harder would be put out of bussiness, and most countries don't want all of their food to be imported for obvious reasons.

Yes politics play a huge part in the US in terms of pandering and pork, but try to end them and you will see 'Farm Aid XXXXV' and every other whine group out there about the plight of the poor farmers.

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kutulu

I do think that we need to be cabable of feeding ourselves no matter what happens. Whether or not this requires subsidies or not is beyond my knowledge but we do not want to outsource too much or our agriculture.

JustJess

I don't know nearly enough about this. Can anyone point me in a direction to do some reading? I'd prefer as unbiased as possible.

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lurkette

OK, I don't know about biases among the economics community, but this is what the Copenhagen Consensus came up with:

http://www.copenhagenconsensus.com/A...ers_140504.pdf

The Copenhagen Consensus http://www.copenhagenconsensus.com/Default.aspx was sponsored by The Economist, which is hardly one of the usual lefty discussants in these "ending global crises" dialogues. It's headed by Bjorn Lomborg, an environmentalist who pissed off a lot of other environmentalists about 3 years ago by claiming that global warming wasn't actually that bad. I don't know the details, but I do know that he's a controversial but generally respected figure who respects science more than ideology.

I'm gonna go read that paper now.

Edit: Here is another listing of papers and articles that seem more accessible than the Copenhagen one.

http://www.globalpolicy.org/socecon/trade/subsidies/

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"If ten million people believe a foolish thing, it is still a foolish thing."

- Anatole France

Locobot

Dwindling oil supplies will pretty much take care of this "problem" in the next ten years. It won't be viable to grow crops (using oil-based fertilizers and pesticides) and then ship them 10,000 miles. Salads will get really boring.

In terms of larger issue security it's not wise for 1st world nations to give up their capacity to produce key products: food, steel, etc. So these things will continue to be subsidized.

Yakk

Food sources are a very important factor in national defence. If your nation is dependant on food imports for its very survival, a blockade or trade embargo can literally starve your nation to death.

For most nations, making your nation self-sustaining in food production is relatively cheap, compared to the costs of other defence measures. As a wealthy nation, artificially maintaining an agriculture base has a good security:cost ratio. So you waste money and dump food onto the world market.

At the least, my meagre knowledge seems to indicate that was the source of argricultural subsidies in the USA -- a defence measure to keep farm production up.

Sadly, this causes massive economic hardship to people from poor nations who cannot afford these kinds of subsidies, and have a relatively high efficiency at producing food (compared to other goods).

In addition, subsidies for special interests are also very hard to dislodge in general. In the USA, agricultural subsidies mainly go to the states with "extra power" in the US Senate. In effect, the votes of farmers are worth more than the votes of non-farmers in both presidential and US senate elections. So you take money from the non-farmers and give it to the farmers in the form of agricultural subsidies.

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Last edited by JHVH : 10-29-4004 BC at 09:00 PM. Reason: Time for a rest.

AngelicVampire

Yakk is of course correct, losing food, defense companies etc is a sure way to lose your independence, sure you might seem to be fine but being heavily depenedent on other countries for basic supplies and hardware ensures that they have you on a leash.

The question of causing hardship is not really there, many of these countries could maintain an agricultural base of their own however our cheaper grains etc are bought in, much like America/Britain and Chinese electronic goods, we are losing a lot of our ability to produce equipment. Its shooting yourself in the food for a short term gain, most people will do it rather than taking the long view for ourselves and future generations.

Allowing third world countries to compete lowers the ability of developed countries to compete, look at China, people willing to work for far less than US workers, doing longer shifts and more dangerous work (less safety conscious, people are cheap). The US basically cannot compete against the Chinese for producing goods because the associated costs are higher. Of course this sounds wrong, suppressing people is wrong however to allow yourself to be undercut at everyturn also spells suicide for the developed nations... we need to find a middle ground where we have something to ensure that we do not become purely dependent (imagine if Iran provided 50+% of the US grain supplies, would the US be as stringent in looking for weapons etc if you knew that you could easily have a major food supply problem?).