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The Forum > Article Comments > Renewing our focus on food > Comments

Renewing our focus on food : Comments

By Julian Cribb, published 12/1/2011

The challenge for Australia in coming decades is to assure its own food security in an increasingly food-insecure world.

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Very good article Julian. I hope that people will take this issue seriously. As an irrigation farmer i am very concerned with peak oil, most people in our society have no idea how dependent modern agricultural output is on cheap oil. Best of luck with this.
Posted by Souphound, Wednesday, 12 January 2011 7:37:36 AM
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Thanks Julian. I am particularly interested in your last point: "This is due to a market failure driven by the growing imbalance in market power between 1.8 billion producers and the handful of corporates who now dictate the world price of food." I agree that the global food system at present appears to be in a condition of "market failure". You mention one mechanism of failure whereby prices are set via a mechanism that is remote from true production costs. A second mechanism of failure is that food's status as just another commodity in the global economy means that investment and production decisions are driven by profitability, rather than need. People who, through poverty, are unable to express their need for food in the form an economic demand, do not feature in this food system, and hence they starve.

I also wonder how many Australians are aware of the implications for our food system of our decades-long practice and advocacy of deregulation of the farm sector. Our policy position is clear: we look for our food security to the global free market. This policy implies that we will eat whatever food corporate actors in the free market decide is profitable for us to eat. In the short term that is likely to mean that high labor-cost products, particularly fruit and vegies, will increasingly be imported. Who knows what it will mean as the cost of factors of production changes in response to peak oil. As you say, if we lose particular industries they can't be reinvented over night.

I wonder about the sense of trusting global markets to put food in our pantries when in 2008, and again in 2010, we saw dozens of countries responding to conditions of food shortage by banning food exports - WTO rules be damned. So what would a national food policy look like that harnesses the innovation and entrepreneurship of free markets, while maintaining some measure of control of our food destiny? I agree that paying farmers for stewardship services is likely to be a useful step, but suspect that more will be required.
Posted by MultiMick, Wednesday, 12 January 2011 9:47:17 AM
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Souphound:

“most people in our society have no idea how dependent modern agricultural output is on cheap oil”

And may I add to your text:

..And how dependent are consumers on their ability to pay for the power to cook it, and the available resources to pay super inflated prices in chain stores to acquire your food production for their very survival; after the inclusive burden of rip-off prices for petrol at the pump to the same beleaguered consumers of food in our society.

So souphound, we the consumer, have every idea of the “sinking-feeling” of dependence and relate well to your concerns over the cost of oil at the farm gate.

If the farmer were paid fairly for his product and the consumer were charged with the same fairness for the farm product, all would be well. What is needed is that all-round fairness of costs and profits which would eliminate the need for Government subsidies to selected groups!
Posted by diver dan, Wednesday, 12 January 2011 10:06:28 AM
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This just lobbed into my in-box:

http://www.youtube.com/watch?v=M1et_HBmLYw

A few things about Woolies/Coles people might not know about. Does anyone have a solution?
Posted by bonmot, Wednesday, 12 January 2011 10:44:32 AM
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The NSW government has abandoned public involvement in Agriculture.

Over 5 years there have been 5 rounds of redundancy within what was NSW Agriculture along with effective cuts in budget in real terms; that body has disappeared through mergers of Departments into what is now the Department of Industry and Investment. There is now a review undertaken by Price’s commissioned by Treasury that has concluded the Department can no longer do what it once did and should be cut further! Supposedly in excess of $50,000,000 is to be cut.

A decade of decline has led to the Department no longer having expertise in many areas – for example horticulture no longer has a principal Research Scientist, there is no technical expertise in locusts yet the Department still pretends to be credible in dealing with outbreaks!

This picture has been repeated in all states.

Julian Cribb points out “The context in which Australia must shape its future agriculture and food policies is one of a world in which global food demand will double by the mid-century ... resources needed to satisfy it … will become much scarcer or increasingly unaffordable … Strategic think tanks … are already warning about the consequences of this for conflict and refugee crises, for economic shockwaves and food price hikes, even in affluent and otherwise food-secure countries”.

Government’s have primary responsibility in this area. Public commitment to the areas identified by Cribb must occur, and lead times of 15+ years born in mind.

The NSW Department has become moribund.

It is a body in which hope has died, current plans will see an end to research and extension with what remains becoming Biosecurity NSW with some policy staff to advice the Minister. Years of being a backdrop to the political aspirations of the Minister of the day has developed sycophantic behaviour amongst staff lacking the integrity to argue for what they believe (one must first believe anything to do that) as well as despair due to the loss of hope.
Posted by Cronus, Wednesday, 12 January 2011 10:58:34 AM
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Continued…

The ‘system’ has conspired to ensure only palatable advice is produced for the Minister with anything contentious marked ‘Cabinet in Confidence’ to ensure it can’t be released; unpalatable advice is returned as not having been received. Time is spent filtering what is produced second guessing what the political masters want to hear.

The picture that emerges is of a group of people who lack hope, lack direction and are slated for closure.

So who will look to the food security of our children let alone our children’s children? Coles and Woolworths?

NSW Government needs to recreate NSW Agriculture with clear outcomes in terms of food security. It needs to directly address the points raised by Cribb and break the nexus between employment and project mentality which leads to people writing up the issue they are dealing with as being bigger than Ben Hur in order to guarantee funding.

Whilst Price’s may have provided a report calling for budget cuts managers make decisions not consultants; any Minister that hides behind a report should not only leave the Ministry they should leave parliament.

The choices are simple; either adopt the cuts and abandon research and extension leaving Biosecurity and policy advice OR rebuild an organisation that pursues outcomes in terms of food security (remembering lead times of 15-20 years will prevail). Cribb has provided an invaluable input to the debate.

The public at large needs to realise the ongoing destruction of public investment in Agriculture that addresses food security means your children and their children will face threats to food. To quote Cribb “Food production cannot be turned on and off like a tap, at the whim of global markets or politicians. It takes decades for a new technology or farming system to be widely adopted: meantime drought, poor returns and global competition can eradicate local food industries.”

If the recommendations from Price Coopers are adopted then Government will have abandoned their responsibility of ensuring food security in the future.
Posted by Cronus, Wednesday, 12 January 2011 10:59:27 AM
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Cronus: I suspect other state Departments are in as bad a state as NSW. If this is to change there is an ideological issue that will need to be examined: do we believe that some measure of food self-sufficiency is a necessary component of our food security? At the moment the implicit answer to this question, at the level of policy, is "no". Hence there is no policy basis for treating agriculture any differently from other industries, all exposed to the cut and thrust of market logic. The decline in public investment in agriculture is a direct result of our ideological stance - a stance which differentiates Australia from most other nations who have national policy positions on food security and its relationship to domestic food production.
Posted by MultiMick, Wednesday, 12 January 2011 11:10:21 AM
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MultiMick, in some ways the NSW Department has fared better than other state Departments; but you are correct, all are in a parlous state.

Phillip Adams once allegorised the election of an atheist to being the Pope to the manner in which governments do not wish to govern. The NSW government is a prime example; they have abandoned their role to the market.

Agriculture is the primary industry for national security, as an example of the whims of markets London’s Heathrow (the busiest port in Europe) stayed closed recently due to snow as commercial decisions allowed shortages of capacity to deal with such events; the army had to be brought in to open the second runaway. Post secondary education has gone the same way.

You are correct, there needs to be a reappraisal of the ideological basis (or life beliefs) on which we approach such issues. What changed in terms of life beliefs between Higgins’ Harvester Judgement (established minimum wages) which established “pay his employees a wage that guaranteed them a standard of living which was reasonable for ‘a human being in a civilised community’, regardless of his capacity to pay” (http://en.wikipedia.org/wiki/Harvester_Judgment) and current beliefs that what a market dictates is the basis for deciding who gets what?
Posted by Cronus, Wednesday, 12 January 2011 11:32:14 AM
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Unfortunately the process begins much earlier, and involves an emphasis of zero waste.

This has to be learnt in the home and at the schools, and I can remember putting this to a group of teachers (at a P& C meeting) that the school develops a policy of zero injuries / zero waste. They were all ears and highly enthusiastic, until I informed them that it would entail large amounts of risk management and also developing checklists to determine what should be purchased and bought into the school that could result in unnecessary waste.

Then their enthusiasm stopped.

However, with a looming fuel crisis, food shortages, water shortages and various other situations likely to develop in future years, reduction of waste is essential, and management skills in waste reduction are skills that school children will have to learn.

Like many other things, it is the teachers holding them back.

I haven’t heard of any that have such a policy, (or they don't advertise that they have this policy), but universities in this country should also be developing a policy of zero injuries / zero waste, to help prepare students for future years.
Posted by vanna, Wednesday, 12 January 2011 1:48:47 PM
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We can only imagine with horror a world in which the food supply is organised by
a) the United Nations
b) the NSW government, or
c) the opinions of boffins.

The problem of scarcity is that there are not enough resources to satisfy all possible wants. But this tells us no more than that there is a need to economise resources, that is, to allocate them to their most urgent and important uses.

The fatal flaw in the article is the jump involved in reasoning "because problem of scarcity, *therefore* policy is the solution".

The author happily recites the number, kind, variety and wonders of policy that he would like to see involved. It never occurs to him to question, let alone to prove, his assumption that bureaucracy is capable of making the situation better than worse. He makes the same assumptions of the beneficence of government that were made when governments starved over 100 million people to death in the twentieth century when they took over the food supply motivated by the same belief that the existence of profit shows a misallocation of resources.

The frightening thing about it is that the author does not begin to understand the astronomical gap that yawns between his knowledge, and the knowledge of all the persons in the world already engaged in ensuring the food supply. They have the benefit of a direct interest in their success, of negative consequences for failure, of local knowledge of resources, of knowing the value scale they are working to satisfy, and of economic calculation with the rest of the world’s population engaged in social co-operation through the division of labour.

The author has none of these, nor apparently even the understanding that they might be relevant to a successful outcome.

It is no more scientific to conjure a solution to the problem by assuming government can fix it than by assuming the Vatican can.

The religious liturgy is seen in Cronus lamenting the catalogue of chronic woeful governmental incompetence, and therefrom directly concluding that *more* government must be the solution! God 'elp us!
Posted by Peter Hume, Wednesday, 12 January 2011 8:50:04 PM
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Peter Hume,
If a company does not operate economically, then it can go out of business. But governments do have a role to ensure that a company going out of business does not result in starvation of the population.

I have personally seen the situation where the shelves in the supermarkets in a town were almost bare within a week because the roads were cut, and the food supply in many towns is heavily dependant on being able to get road or rail transport to the town.

It would be interesting to know how much food is being kept in storage in Australia, and how long it would take for that food to run out, particular when so much food is now imported, (like nearly everthing else).
Posted by vanna, Wednesday, 12 January 2011 9:20:58 PM
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Bonmot:

Thanks for that link. Now add the following to the conundrum of the list of consequences of Coles and Woolworths market manipulation: “The farm subsidy”, this has become a necessary component of survival for Australian farmers as they struggle for economic survival against the odds of unfair pricing for farm commodities, (as well the negatives created by the normal front line war with the elements). Sure, the subsidies correctly prop up the farming industry, but guess who the winners are.

A subsidy is a taxpayer contribution not to farmers as it appears, but in-directly to conglomerates in the retail food industry, Coles and Woolworths in particular,(being by far the majority players in Australia). They, without a doubt, gain the greatest advantage from cheap commodity prices allowing them to exploit the advantage at the retail price end. One example amongst thousands is potatoes: The “farm gate” price to Coles and Woolworths is a paltry .30c per kilo; the retail price of potatoes never falls below $2.99, (.10c per potato for Coles and Woolworths, retailing @ $1.00 per potato, based on average weight, for the consumer) representing a ten-fold mark-up.

Without farm subsidies ridiculously low “farm gate” prices would be imposable. One can only conclude the tax payer subsidy ably assists the giants to hold down the super inflated prices to a tolerable level ensuring consumer resistance to cost causes minimal impact on volume sales.

It appears to me to be a very bad deal when “consumer as taxpayer” pays for profits at both ends of that deal.
Posted by diver dan, Wednesday, 12 January 2011 9:48:40 PM
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Vanna
A one-off emergency function is one thing; but what these statists have in mind is a thorough-going increase in governmental meddling in all aspects of food production, without an inkling of an understanding of the economics of what they are suggesting.

Obviously if we count only the benefits of an action, but not the costs, then anything will seem beneficial, and that is the only reason why their proposals are able to seem anything other than absurd and wasteful.

The idea that food security requires national protectionist measure -, quite apart from the fact it is likely to provoke wars - has the economic understanding completely backwards.

It is the same old fallacy of protectionism, re-birthed. If it were true that the people of Australia would be better off restricting trade in food with people outside Australia, then for the same reason, it would be true if the people of a State within Australia restricted trade with people in the other States. For the same reason, it would be true if the people of a district within a State restricted trade with the people of other districts, and so on down to the level of the household and the individual.

You can't increase food production by reducing the division of labour, which is indeed *the* social principle.

The understanding of the statists is completely back-to-front. In their topsy-turvey world, it is as though the state is responsible for producing all the food and all the value in the world! Their ignorance of the basic essentials of human co-operation is profound.

As a food producer myself, I can easily see how Australia's government restrictions are at least halving my own production. And this is the institution whom the statists blithely assume, without a scintilla of insight or critical thinking, are the solution to food shortages! It's a complete inversion of reality - and if we could account for the negative contribution of all actions of all governments at all levels in all countries worldwide, easily responsible for the entire phenomenon of the food shortages in the world.
Posted by Peter Hume, Wednesday, 12 January 2011 10:18:13 PM
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I knew an expression of the strong anti-regulation sentiment wouldn't be far away. Thanks Peter Hume for adding this important thread to the discussion. I agree that when intervening in markets Governments often get it spectacularly wrong - witness the Pinkbatts fiasco. But they do also sometimes get it right. It has been argued in many quarters that Australia's relatively strong regulation of the banking sector protected us from the wholesale meltdown of the financial sector that we witnessed in the US and parts of Europe (which, ironically, then demanded a mega-intervention in the form of taxpayer-funded bailouts). So I think carefully designed regulation can be helpful. And it can be designed to have minimal effect on price signals, hence retaining the dynamism of market competition.
Posted by MultiMick, Thursday, 13 January 2011 7:36:53 AM
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MAD has been a theory of military defence for considerable time (Mutually Assured Destruction). In simpler terms ensuring countervailing forces apply prevents an abuse of power, and history demonstrates those with power inevitably abuse their position.

Cribb’s article essentially argues for capacity building, I have argued for knowledge and capacity building. The notion of governments doing other than ensuring countervailing forces within a market seems to be Hume’s invention in this debate.

Is the idea then, if markets are so good, to remove all government restraints whether labour laws, financial regulation and patent/copyright protection and let the winner take all? Let the PIGS go to the wall in Europe – but history teaches all suffer under that scenario.

Yes, governments have a history of being inept. Responsibility lies with voters for that.

Markets as the answer? GFC rather demonstrates markets in their true light. Madagascar faces food shortages, the market allowed Koreans to lease substantial areas of land and take food to Korea. That is the market.
Posted by Cronus, Thursday, 13 January 2011 9:12:58 AM
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You and Julian Cribb are so right, Cronus. If we listened to the Peter Humes of this world, Paul Ehrlich would have been right, and hundreds of milliions of people would have starved in the 1970s without the Green Revolution, which depended both on government and on private philanthropy. Private companies have responsibilities to their shareholders and will not invest in blue sky research with a low probability of success. Nor will they invest where the benefits of the research cannot be captured for the company, or where they will mainly go to people who cannot pay.

Governments are often inept, but leaving it all up to individuals who need not consider the longer term (due to limited life spans), may be ignorant, and may have vested interests is even sillier. Without regulation, tobacco companies would probably be advertising to schoolchildren.

I do wish that Julian Cribb had mentioned population. As Norman Borlaug, the "Father of the Green Revolution", said in his Nobel Prize acceptance speech, advances in agriculture are ultimately futile if population continues to grow without limit. Dr. Cribb does talk about it, though, in his excellent book, "The Coming Famine".
Posted by Divergence, Thursday, 13 January 2011 9:46:38 AM
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We are all agreed then that governments are often inept - but the statists hold a flame for their old love.

According to this theory, people with a direct interest in eating, and others in making profit and avoiding loss, wouldn’t have the idea of doing what would be necessary to make their situation better but governments, without the incentives and with no better knowledge, can just magically fix any given problem we hand it.

Since government doesn’t have any resources of money or knowledge that are not available to the population as a whole, only force, the theory is that centrally directed *force* (“policy") can fix the problem. It’s nonsense.

We are able to directly judge the success or failure of private action because of the instruments of profit and loss. But with government, these do not apply. So how are its advocates judging the success or failure of governmental action? They simply *assume* that governmental action must be beneficial. So we get this open-ended unaccountable conjuring – which is only reviewed when the waste and disasters are so enormous they can’t be ignored.

The GFC proves the opposite of what the statists assume, because government at all relevant times claimed and exercised control of the supply and price of money– (money, as in, it’s a *financial* crisis). The statist theory is that government has the competence to, and should regulate the money supply so as to provide stability and ensure full employment. The libertarian theory is that this will cause massive economic upheaval and unemployment. So whose theory was proved correct? The statist response is to blame the market. But either way – whether the government does, or does not have the competence it claimed - the statist theory is proved wrong.

“Is the idea then, if markets are so good, to remove all government restraints […] and let the winner take all?”

Yes - let the people – not bureaucrats - decide, and thus direct the course of production to their most urgent and important wants.

Voluntary co-operation is mutually beneficial, not a zero-sum game like coercion.
Posted by Peter Hume, Thursday, 13 January 2011 11:39:42 AM
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Divergence, you point to the issue that total reliance on self interest inevitably constrains common interest. Garrett Hardin’s “Tragedy of the Commons” (1968. "The Tragedy of the Commons". Science 162, 1243-1248) points to the impact even innocent actors have, and argues the limits to damage is government instrumentality. William Lloyd first argued such issues in “Two Lectures on the Checks to Population” (http://books.google.com/books?id=kQt9Kg-chXAC&ots=seD3WAKeH4&dq=Two%20Lectures%20on%20the%20Checks%20to%20Population&pg=PP3#v=onepage&q&f=false).

These people, and those following them, well recognised individuals left unconstrained will damage the collective interests leading to destruction. Hume has concurred with the notion “let the winner take all? Yes - let the people – not bureaucrats - decide, and thus direct the course of production to their most urgent and important wants…”

Can those arguing for removal of government instrumentality have the capacity to imagine the impact of the USA doing nothing following Lehman’s collapse and subsequent GFC? Or the impact on Europe of failing to commonly address the PIGS of Europe (Portugal, Ireland, Greece, Spain) and their financial woes?

Hume’s statement above equates to the self serving stupidity within the finance sector and amongst property speculators that threatens to bring the entire economy undone. Ireland’s commercial property absurdities are an example. Perhaps the impacts of the ‘Great Depression’ or the outcomes of the property bust in the late 1800s have been forgotten?

2 Timothy records “People will be lovers of themselves, lovers of money, boastful, proud, abusive, disobedient to their parents, ungrateful, unholy, without love, unforgiving, slanderous, without self-control, brutal, not lovers of the good, treacherous, rash, conceited, lovers of pleasure rather than lovers of God…”

That there needs to be a major rebuild of government bureaucracies is undeniable, they are populated by executives on short term contracts who survive on sycophancy to Ministers. But the need for government instrumentality in preventing damage to ‘the common’ remains essential. Don’t confuse governments’ setting boundaries on the sand pit we play in with how we play in the sand pit.
Posted by Cronus, Friday, 14 January 2011 11:43:15 AM
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Peter Hume,
I live in a town that is located about 1000km from Brisbane, and the shelves in the local supermarkets are now ½ to ¾ empty.

While bread still seems available, milk is almost non-available and fruit and veg is fast disappearing. In fact, the food stuffs that could be regarded as nutritious and able to sustain life are nearly gone.

Most of the supermarkets are run by your much cherished and much loved multi-national companies, and it seems that they have not been stocking enough food locally, but keeping most food in large warehouses in Brisbane, and then transporting it out to the rest of the state by road or rail.

Most of these much loved multi-national companies make huge profits, and could easily afford to store more food locally, if governments imposed that requirement upon them.

I don’t fully accept the theory of global warming or climate change, but our state and federal governments do.

It would be a test for our state and federal government to impose requirements on the much cherished mult-national supermarket companies operating in our country, that they do store more food locally, in case of more catastrophic weather conditions.

However, I don’t think our governments will do that, because they also cherish the much loved multi-national companies, and wouldn’t want to burden them with having to build more warehouses.
Posted by vanna, Friday, 14 January 2011 3:40:22 PM
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Cronus
Three fundamental problems with that approach:

Firstly you assume the statist orthodoxy is correct, namely, that the economic problems you refer to arise spontaneously out of unregulated capitalism. However both the Great Depression, and the current economic problems of Europe, arise in a context in which government controlled the supply and price of money. So the foundational assumption, that such instability arises out of unregulated capitalism is *not factually correct*.

Prices are the steering mechanism of the market, so by controlling the price of money, government controls the steering mechanism of the financial markets – which just happen to be the origin of the gross economic crises in issue, surprise surprise.

Economics tells us that prices function to clear the market – to equilibrate supply and demand at that price – so by regulating prices to some other level, we are *guaranteeing* the shortages and surpluses that just happen to define the economic crises supposedly requiring government’s wise hand on the tiller.

Secondly, even if it was correct that these problems arise out of unregulated capitalism, which it isn’t, the statist *assumption* that government has a general residual competence to manage problems thus arising, is disproved. Either government does or does not have the competence to manage the economy, and either way, the facts consistently disprove the statist theory.

Thirdly, it is not enough to believe in a general need for government to prevent damage to the commons. Given the defects of bureaucracy are common ground, it is not good enough to assume that if government keeps banging away with its meat-axe, it will optimise outcomes eventually. You need to be able to say *how* to distinguish hope in bureaucracy that is well-founded, from that which is not, *beforehand*.

You can’t “rebuild” bureaucracies so as to solve these problems inhering in common property, that’s the whole point. The tragedy of the commons cannot be solved by more communism however called - it can only be solved by individual freedom and private property.

http://economics.org.au/2010/07/the-tragedy-of-the-tax-pool-commons/
Posted by Peter Hume, Friday, 14 January 2011 3:43:16 PM
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Vanna If more people did embrace climate change maybe something would get done. Don't blame the govt; just because they believe something is at foot. The best option is to guard against panic buyers.
Posted by 579, Friday, 14 January 2011 4:41:24 PM
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579
There is panic buying, and it often occurs before a cyclone.

But if people knew that food was being kept locally, then it would reduce panic buying.

However thet know that very little food is kept locally in a town of 120,000.

To maximise their profits as much as possible, the dear multi-national companies have centralised warehouses in Brisbane and operate fleets of trucks to take food to the rest of the state.

If something happens to the roads, then too bad for the rest of the state.
Posted by vanna, Friday, 14 January 2011 5:52:06 PM
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Vanna

The dominance of markets by big multinationals is more a result of government intervention than of economic liberalism. The reason is that taxation and regulation count much more heavily against smaller more marginal businesses. The bigger ones are able to bear these costs much more because of economies of scale. The result is that big government and big business tend to go hand in hand.

So what did you have in mind? A law saying that supermarkets must store more food locally against emergencies?

Presumably the advantage would be that food is more likely to be available during emergencies, and the disadvantages is that during ordinary times, more food would waste, and food would cost more.

You assume that people would prefer to have the insurance in emergency times, than lower prices in ordinary times. But obviously, if they did prefer that, there would be no need of a law to force the issue.

Also there's nothing stopping supermarkets from doing it now. Obviously the reason they don't, is because people would prefer the competition who don't do it, on the ground of their lower prices.

It's basically an insurance question. Try this thought experiment. There is a very small risk of the earth being totally devastated by a meteorite. We can insure against it by collectively paying for a gun to blast it to smithereens in outer space. But the cost will be half of GDP, so no more cappuccinos, videos or cars - but total security against an unlikely risk. People might reasonably prefer the ordinary pleasures against the extraordinary insurance.

And why should you or anyone else be able to force them to prefer your values over their own?

Thus no-one has been able to demonstrate a benefit of coerced co-operation over voluntary co-operation.
Posted by Peter Hume, Saturday, 15 January 2011 5:27:05 PM
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Peter Hume,
As for food, there is availability, and then there is supply.

In QLD at present, there is available food, but limited supply because so much food is being kept in Brisbane.

Take out a few roads and bridges, and the rest of the state goes without food.

While much money has been spent on the armed forces in Australia to ensure national security, a whole state can now be put in jeopardy by eliminating a few roads and bridges.

Storing more food locally will not lead to waste. About 2 weeks to 1 month of food should be available, and non-perishables and canned food can be kept for many months. What goes into storage first is used first with minimal waste.

The supermarkets want to maximize their floor space by minimizing their warehouse and storage space, and you will note that one of the major multinational supermarket companies made a $2 billion profit in Australia last year.

So it does seem quite profitable to maximize floor space by minimizing warehouse and storage space.

I also question whether famines do often occur in other countries, or is it that food is available, but lack of supply is the problem
Posted by vanna, Sunday, 16 January 2011 6:26:09 AM
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I agree with all you have stated Vanna.

The local Woolworths, Coles or IGA your families have given continual business to over the years, particularly people residing in country towns 500ks+ away from major cities, should ensure that there is a month's supply of essentials/basic foodstuffs stored for their regular customers.

The fact being that small town and country people do not have the choices or options shopping around, particularly during bushfires and floods, that most city people enjoy.

I come from both backgrounds by the way along with witnessing this travelling through towns.

Small businesses cannot afford to stock up, however the larger food chains should be loyal and thoughtful towards their local customers.

Works both ways.
Posted by we are unique, Monday, 17 January 2011 11:15:15 PM
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Look to human nature to gauge the capacity for damage. Whether one analyses infamous episodes such as the Dutch bulb fiascos or any market folly one finds problems that affect the whole.

MAD theory doesn’t hold one or other side has a greater competence – it holds the tension prevents ultimate control requiring accommodations. Hume is arguing as though optimisation is the desired end point – whose optimum, those with economic power or some other group? Capitalism serves those with economic power; what happens to those without?

History shows those who have power abuse it, and arrogantly assume pre-eminence for their wisdom. To quote Wormwood from the film Matilda; “Listen, you little wiseacre: I'm smart; you're dumb; I'm big, you're little; I'm right, you're wrong, and there's nothing you can do about it”.

Hume is the only one arguing as though Governments should run markets – governments are a countervailing force to prevent abuse. Government incompetence, try HIH, Enron, Lehmans etc etc. Australian bank woes some years ago with major writedowns was driven by arrogance, greed and ego at senior levels.

Name the organisations that have longevity. The Church is one. It is arguable the USA’s economic power owes a debt to Christian belief in ‘Servant Leadership’, those in charge have a duty to serve all stakeholders as well as pay heed to future generations. Modern capitalism uses personal gain for senior staff as its lever, studying corporate collapses explodes that myth.

The current era is characterised by the SKI retirees (Spend the Kids’ Inheritance). If the kids are good enough they can make it on their own. Once the ethos was ‘pass on a better farm than I received’, now life is purely about the self.

Are these matters a symptom of deeper issues?

Some Potter fan clubs were threatened for using images from the film on their web site; fans reacted by boycotting merchandise etc, suddenly clubs were encouraged to use the images. Perhaps customers need to be aggressive and bring companies to their knees to pull them into line!
Posted by Cronus, Tuesday, 18 January 2011 11:30:05 AM
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