Liberty Alone

I think Farmer’s Markets are great. Not because I shop at them much (I find them too expensive), not for environmental reasons (I don’t buy into the whole ‘food miles’ thing - its a very bad measure of environmental impact), but because its entrepreneurial.

Producers and organisers have seen a gap in the market and have gone for it, often with great success.

There is a large constituency of people who for whatever reason like to shop at farmer’s markets.
When I occasionally shop at one its due to products that supermarkets don’t provide (the apple juice we used to get from the now closed local market was fantastic and the apples were just as good and cheaper than the supermarket).
Others like the aspect of it coming fairly directly from the producers, other buy into the environmental argument and many people probably have their own reasons or combination of reasons.

Whatever the reasons, Farmer’s Markets have (re?) discovered some things which people value and are willing to pay for (in money and time and travel) and hopefully making themselves a profit.

The essential thing is to keep innovating. Supermarkets and other shops have seen some of the things which farmer’s markets have been doing and adopted aspects, farmer’s markets must adapt to these changes. It will probably mean less profit (as occurs with every entrepreneurial effort after others adopt the methods) so new ideas will need to be tried.

EuObserver reports that M. Sarkozy has backed the idea of reforming the Common Agricultural Policy, one of the most ludicrous, expensive and inefficient EU policies.

The fact that the French government is even thinking about shifting their position of just saying ‘Non’ to reform is a large step, and he’s phrased it fairly well-

I do not want to disappoint farmers who do not want hand-outs, farmers who do not want to live off subsidies and farmers who do not want to be subjected to regulations on their livestock’s hair.

Admittedly rhetoric is easy (although in France with the farmers seemingly ever ready to join the students in rioting or burning sheep it may not be quite so easy) and I’m sure any deal will fall short of abolishing the CAP, but this is at least a step in the right direction.

Now all we need is for some real action on the Common Fisheries Policy, if anything a greater disaster for the environment and people than the CAP…

Iain Dale asserts that supermarkets don’t operate in a free market and that the poor little farmer suffers because of it (its a familiar argument).

Taking a step back and looking at this, the argument is not one of free trade, its one of sentiment and so-called fairness.
The charge is that the supermarkets use their buying power to screw the little farmer and that somehow this means its not free trade (Why? Because the farmer cannot set the price at will?). Then of course the argument of ‘fairness’ comes in and apparently its unfair for the farmer not to get a better price (but isn’t it also unfair if the poor consumer has to pay more for their food because the farmer gets a higher price? Won’t that have a negative effect on obesity since fresh produce will be too expensive for the poorest?)

This is not an argument based upon economics, it is one based upon appeals to the emotion and sentimentality.

Lets look at the facts:

• Supermarkets are not in a monosopy position - there is not one buyer. There are several supermarkets, there are also other buyers for much produce, small shops, producers of processed food etc.
• Supermarkets do not collude with each other. The competition is too fierce to allow that. Tesco knows that its market position is not permanent. It used to be Sainsbury’s who were the biggest supermarket. In a few years it may well be someone else. If supermarkets were to collude then someone would break that collusion, either for getting goods outside the cartel or for good publicity by exposing it and getting one over on the competition. Every time there’s an investigation into practice there is no evidence of illegal activity.
• Supermarkets do not use force to get the prices they do. They don’t threated people’s lives or health, they don’t go round breaking legs or shooting people
• Market distortion comes at the other end of the market with the subsidies granted to farmers - This distorts the market, it keeps farmers who’d otherwise go bust in business, it encourages over production which results in low prices for produce. Granted, in terms of this market, the distortions are probably less now that the CAP is paid on the basis of land rather than production, but it still distorts the market massively. It still encourages low efficiency and productivity which reduces profits.

So, whilst I’d agree that free trade doesn’t exist, that is because of the subsidy farmers receive. Instead of targeting the supermarkets we should be targeting the waste of tax payer’s money that goes into subsidies.
It will be hard going for some farmers (hence the policy of gradual reduction which I believe is supported by the Liberal Democrats), but that is the way the market works. Those who are inefficient, don’t produce a product people want to buy and are unproductive will go bust. Those who are efficient and produce goods that people want at a price people will pay will do well.

Why we spend so much time and money on a tiny proportion of the population and economy I don’t know. It seems to be some sort of sentimental view of the farmer as custodian of the countryside and lifeblood of the country. It should be treated as any industry and left free to engage in the free market.

Hugo Chavez is following in Mugabe’s footsteps and seizing land to ‘redistribute’ and install collective farming.

This policy has recently been tried in Zimbabwe and has been a spectacular failure, taking the country from being the breadbasket of Africa to being a country of rampant inflation and massive food shortages.

Of course, Zimbabwe isn’t the only country to have tried this. China tried it during the ‘great leap forward’. What were the results? Famine and death.
It was even tried by some early settlers in the Americas. They tried collective farming and almost starved, it was only when private farming and the ability to trade was introduced that they prospered.

Collectivisation and nationalisation is a recipe for disaster. The disaster may be staved off due to Venezuela’s oil wealth, but that will only serve to prop up a rich, corrupt elite and prevent the liberal reform which would disperse wealth more and provide opportunity for the masses.

I’m sure the left in the west will continue lauding Chavez, even as his errors become manifest, if only because he’s anti-American and claims to be standing up for the poor against the exploitative capitalist.

The Globalisation Institute has something on the latest absurdity of the CAP, and Tom Papworth expands on it.

Will the LibDems call for scrapping it yet?

There’s been a little lunacy emanating from the Welsh Liberal Democrats recently, but this really takes the biscuit.

This is basically a call for tariffs and protectionism. Its a call for putting the interests of farmers over those of everyone else.

Farmers already gains from obscene tariffs and the inhuman Common Agriculture Policy which sees $1200 a year taken from the pockets of a 2 child family to spend on farming and around $20 billion in losses a year from the developing world - far more than we spend on aid.

This goes to give each cow in the EU $2.50 a day - when billions of people struggle to live on under $2 a day.

This is obscene.

Now we’re told that the farmers cannot cope and need more help, now dressed up as ‘fair trade’ (remember, free trade is the only fair trade).

If they cannot survive with the obscene level of support they already have then frankly what are they doing in the business?

I’m sure people will complain about the job losses - but its not liberalisation which causes them, its the protectionism which encourages stasis and protects from the competition which breeds progress and success.

The Liberal Democrats are meant to be a party of free trade, a party of the individual and the masses against the classes. Not a lobby group for today’s high profile campaign.

As for British farmers being labeled ‘Fair Trade’. If the Fair Trade group lets them then fine, they can apply and be approved or not.
If they can’t, then develop their own branding. See if you can get people to pay a premium for that. That’s all fine, but it is not the politician’s place to support that.

Update:
The hypocrisy of this still rankles.
Why is Fair Trade seen as neeed? Because the developed world is deliberately pursuing protectionist policies designed to remove the developing world’s comparative advantage and means to develop and get out of poverty.

He was 100% correct. Organic food is a lifestyle choice.

Of course the producers and marketers tell you its different, they are promoting a brand and selling goods, why wouldn’t they say its wonderful?

But, there are serious problems with organic food. The organic movement is part of a broader, anti-rationalist, anti-progress movement. It denies change and harks back to a ’simpler, purer’ time.
There are no proven health benefits to organic food. There could even be harmful effects from the increased level of toxins in the produce which make them pest and disease resistant.
Organic farming needs far more land to produce food. Land is scarce, the only way we could have enough land to approach providing enough food through organic methods is to farm the very habitats which organic farming is supposed to protect.

What about the costs? Organic food is more expensive because it is more labour intensive. The costs at which people are willing to sell it are therefore higher. We need cheap food for people, not expensive food.

Modern agricultural techniques are effective and cheap. The reason they have damaged the environment is not because they are bad per-se, but because we are forced to produce too much food in this country by the shameful protectionism of the Common Agricultural Policy. Britain is not the best place to rear beef cattle, we don’t have the space, so we cut corners, fed them things which they’d never eat in nature, hence BSE.

The organic lobby is that, they are a lobby, they want you to buy their products. If you find some food better quality, worth the price you pay, by all means buy it. I will not interfere with that choice, but please don’t tell me its somehow better for me with no evidence, or its better for the environment than any other form of agriculture when it isn’t in many ways.
Do not claim it will cure all our ills, it will not, it would cause its own problems.

We need a free market in food. Not the protectionism of CAP, or the protectionism of the organic lobby. Let us make our choices, let us decide what we put in our own bodies and what we spend our money on. If the claimed benefits of organic food are important enough then organic food will become far more popular (like free range and barn eggs are now far more popular - people feel the lack of cruelty to hens is worth the premium).