Smart Stuff From the Comments

From a reader named Paul Kilmartin, in response to Steve Sexton’s post “The Inefficiency of Local Food”:

Well, if we’re going to think like economists, then lets talk about how we got here. The food distribution network cannot thrive as it does now without the massive public works program called the Interstate Highway system, which subsidizes distant food movement. Large, “efficient” agribusiness is as much a result of farm subsidies leading to consolidation, and the percentage of crop land dedicated to corn is a function of ethanol policy. Furthermore, FDA policies prohibit or discourage the farming and production of items people want, such as hemp and unpasteurized milk.

On top of that, misinformation of the USDA has driven the public to choose grains over protein and fat, driving the obesity, diabetes, and heart disease rates higher, which shifts resources to those with government-granted monopoly rights to market pharmaceuticals to treat those diseases.

So, in the absence of all these price distortions, would local food be at such a disadvantage? I contend not. So those liberals who want more local food should dismantle the nanny state and public works programs that made pseudo food so much more profitable.

Who cares to argue with Paul?

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  1. roads to subsidize farming? says:

    So the Interstate Highway system subsidizes distant food movement. While roads do not fulfil the classic definition of a public good, (if so desired you could exclude people from using them and there is a limited capacity which means they can be rival) in most reasonable circumstances they are just that, a public good, they are a subsidy to distant food movement but they are a subsidy to anyone who has ever travelled on one and at one time or another I imagine almost everyone has, even the local farm producer.

    Taxing road use would even things up, but wrecking the road network by failing to invest in public works projects to maintain it would be throwing the baby out with the bath water.

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    • EP says:

      There is a clear distinction between local roads and the interstate system, in use and funding. The main subsidies alluded to by Paul are those that drive production of certain crops. I’m always baffled when conservative calls for spending restraint are answered by pleas about roads, as if the government only spent money on roads. If that were its only expense, I told think many would complain about high spending.

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      • Graham Peterson says:

        That warrants a brisk chuckle. Indeed, if providing semi-private goods like defense and roads were the majority of what government did, they wouldn’t require half the revenues they do.

        Now whether large government is a genuine part of the average person’s revealed preference set is another matter. Rational people seem exceedingly willing to invest in and consume an enormous government.

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  2. Justin Lonas says:

    Phil is awesome…and I’ve never even met him.

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  3. RAlazar says:

    “Well, if we’re going to think like economists, then lets talk about how we got here.” Already wrong. Economists know how we got here is irrelevant: sunk costs are sunk costs.

    “The food distribution network cannot thrive as it does now without the massive public works program called the Interstate Highway system, which subsidizes distant food movement.” True, as an argument that the Interstate Highway System had benefits that might have been weighed with its costs. False, as an argument that the marginal cost of moving produce ought to be “counted” higher than it is because the IHS was paid for by government.

    “Large, “efficient” agribusiness is as much a result of farm subsidies leading to ,” as what, c’il vous plait? And leading to what? In any case, we only know that efficient agribusiness is efficient insofar as we estimate it would be large without subsidies. Are you asserting the contrary?

    “and the percentage of crop land dedicated to corn is a function of ethanol policy.” In significant part, certainly–and regrettably. I don’t see what your point is here.

    “Furthermore, FDA policies prohibit or discourage the farming and production of items people want, such as hemp and unpasteurized milk.” So they do. This can be defended, if at all, only on non-economic or dubious externality grounds. I am on the side I think you are taking here.

    “On top of that, misinformation of the the USDA”–surely a non-empty category–”has driven the public to choose grains over protein and fat, driving the obesity, diabetes, and heart disease rates higher,”–conceivable, and bad if true, but please cite evidence–”which shifts resources to those with government-granted monopoly rights to market pharmaceuticals to treat those diseases.” By which you mean the inventors of those treatments and their lawful successors-in-interest? Without a government-granted monopoly they would use the inventor’s natural one, secrecy, with all that entails.

    “So, in the absence of all these price distortions, would local food be at such a disadvantage? I contend not.” Contentions are cheap. Evidence! “So those liberals who want more local food should dismantle the nanny state and public works programs that made pseudo food so much more profitable.” Bravo to dismantling the nanny state and some public works programs. (I’m still for national defense, which is a public works program.) As to “pseudo food”, what happened to your respect for whatever the consumer wants, even it’s as unhealthy as unpasteurized milk and (ahem) “hemp”?

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  4. MeanOnSunday says:

    Efficient agriculture has little to do with interstate highways, FDA policies, or the government in any form. Yields worldwide are dramatically increased by improved varieties of crops, and better fertilization, growing more on less land. Millions of people worldwide owe their lives to the practices that rich Americans can decide on a whim, and without evidence, is somehow less healthy.

    If those Whole Foods customers are thinner than the customers at Wal-Mart then I would suggest that this might be due to their higher incomes and not the food sold by the respective stores. Choosing to eat grass-fed beef that takes 5 years to produce, versus corn-fed beef that takes 18 months is a choice made possible by wealth. Unpasteurised milk is a fad affordable to those with good health insurance; considering that we can’t keep the human population of the US free from TB, let alone cattle, I think I’ll wait for some real evidence of benefit first.

    And as for those government endorsed monopolies, the pharmaceutical companies. Well given that my children can expect to live 35 years longer than my grandfather’s generation, I’m inclined to think that their constitutionally guaranteed patent protection of 20 years is a pretty fair deal. And when I take that medicine it’s nice to know that, unlike so-called health foods, it’s actually been scientifically tested and really does what it claims.

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    • Graham Peterson says:

      Sir,

      I’m on board completely with your note until the last paragraph. Your children will experience the life-span they do precisely because of the food-productivity you outline in the first paragraph, not because of big-pharma’s modern drugs. The most dramatic gains in life expectancy were realized in the beginning of the 20th century at the hands of our major discoveries, mitigating communicable diseases. Industrialized country’s health problems are chronic health problems (obesity, heart disease, cancer), which modern western medicine is largely woe to stem or especially cure.

      Patent protection can be shown, indeed is often shown, to do little for ensuring innovation. See the failure of incentives to promote innovation in Daniel Pink’s summaries, Joel Mokyr’s paper on patents and the industrial revolution, and the blank fact that most people rely on some kind of collaborative and cooperative system in order to create things. An inventor usually has no idea what something will be worth in the long run, and it’s therefore doubtful she can evaluate the present net value of inventing. Ensuring her property right in the future, thus does little to influence her decision whether or not to invent.

      Most patent legislation is in fact now backward-looking, whereby legal firms buy patents no one is paying attention to and go out looking for infringements of them, in order to sue. The activity is not productive like an arbitrage — it is merely a transfer from productive people to lawyers. Also, corporations now routinely lobby to have their patents EXTENDED. There is no way to argue a patent extension will increase the level of innovation society benefits from. In fact extending patents REDUCES the amount of long-term innovation in society.

      I encourage your healthy skepticism of faddish food trends, but I also encourage you to apply that skepticism to an old-guard attitude about incentives in health and intellectual property law.

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  5. Jason says:

    The commercial shipping industry isn’t subsidezed by the highway system, in fact taxes on it subsidize non-commercial driver’s use of the highway system.

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    • Graham Peterson says:

      That is correct. Trucking companies work on infamously thin margins. Note the “weigh stations” along the interstates, requiring loads to be weighed. Taxes are supposed to run proportional to the use-burden imposed by the semis. Heavier trucks break down roads faster.

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  6. aed939 says:

    Steve and Steve, That’s your job to argue with Paul (who is right, by the way).

    Regarding carbs in traditional cultures: Ever notice that whenever you watch a National Geographic special about how this culture prepares their staple starch grain or root? They soak it. They ferment it. They sprout it–to make the bread digestible. That’s what’s missing from modern American bread. There are chemicals in seed and grain which keeps the seed dormant. These “anti-nutrients” need to be transformed to an actively germinating food to make the nutrients more bioavailable. Modern American bread has fake chemical dough conditioners that do not allow for the proper transformation of the food.

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  7. aed939 says:

    Breeding and chemicals take too much credit for the increased yields. A large amount of the increased productivity of all agriculture–both large and small scale–is from the increased concentration of atmospheric CO2 in the past 2 centuries. Could we keep over 7 billion people fed with only 280 ppm atmospheric CO2? I don’t think so.

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