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The Forum > Article Comments > Can the market really provide food security > Comments

Can the market really provide food security : Comments

By Michael Santhanam-Martin, published 20/5/2011

If food producing nations refuse to trade food because of famine at home, will the market continue to provide our needs?

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1.The first priority for food security is to secure our best farmland. At present State Governments are allowing the expansion of coalmines and coal seam gas into prime farmland, alienating productive capacity forever and potentially destroying artesian water stores.

2. There is no policy giving primacy to food production from Australian sources by companies with that primary function. Only when Australian needs are met should the surplus be used for export or in food aid.

3. Foreign corporations are positioning themselves for commercial food security advantage, buying up prime Australian land sometimes within very large budgets outside any scrutiny as each purchase falls below the FIRB threshhold [eg Nexus with $500million]. Some foreign companies are doing this as part of their nation's food security and some are owned by foreign governments.

4. In the case of the Mary Valley, where the State Government has bought up a great deal of farmland which would have been drowned in the Traveston Dam, there is no plan for ensuring its food cropping and grazing productivity, an example of Government inertia on regional food security.

In the absence of a national food strategy, foreign corporations are treating Australia like a third world country and neither federal Labor nor the Coalition have developed policies to secure Australia's food security. Warren Truss has pinched some of my comments on food security but there is no plan.

In failing to act with urgency on the question of food security, State and Federal Governments and both of the major parties are betraying the country and our grandchildren.
Posted by Seamus, Friday, 20 May 2011 8:06:40 AM
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The market could indeed work wonders for food security, if it had
been allowed to operate freely. This has never been the case.

Higher prices would indeed encourage more food production, but
global food prices were kept artifially low for decades, as
the EU and US dumped enormous subsidised foodstuffs around
the world. The net effect was less food production in those
parts, including Australia.

The cost of wheat has little to do with what you finally pay for
a loaf of bread. It might be 20-30c. The real cost is the food
chain from the farm gate to the consumer. But companies will use
any shift in global grain prices to cry wolf and increase prices,
often for their own bottom line benefit.

You can buy Australian garlic or Chinese garlic, the choice is yours.
Both are produced and sold. But if you want Australian garlic,
you'll have to open your wallet a bit further, to allow for the
higher cost of producing it, given that its labour intensive.

The real problem seems to be that many people want food to be
produced at below the cost of production, as it used to be.
Well sorry, oil, machinery, fertiliser, labour have all increased
in price. People won't produce more, if its not worth their while.
Posted by Yabby, Friday, 20 May 2011 10:15:43 AM
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The problem as cast is that foreign governments might restrict Australia’s food imports. So firstly it is inaccurate to characterize the problem as “the market”. On its own terms, it’s “the government”.

We need first and foremost to understand that food nationalism is a beggar-thy-neighbour policy which cannot be sustained as a stand-alone solution. Not even the boldest interventionist is suggesting that government could or should have the prime responsibility to provide food, because they know very well that attempts in the 20th century to do so caused tens of millions of deaths by starvation. All food security policy depends on underlying functioning markets, which the interventionist hopes to manipulate, but not to abolish.

Food security policy is a species of the genus price controls. The idea is that the state will *cause* a food shortage outside its borders rather than let one happen within. However price controls in general have a history that is at best wasteful and at worst disastrous. They typically cause negative consequences worse than the original problem, which the interventionist mindset can then only think to counter with more of government’s meat-axe approach. Abolishing any prior interventions never seems to occur to them.

For example, governments are already causing enormous reductions in Australia’s food production in countless ways. Vast swathes of land are taken out of production and given over to the *notion* that comfortable middle-class marginal voters *might* bushwalk in it, oblivious to the fact that this causes people elsewhere to go without food! Through the Native Vegetation Acts, governments have in effect confiscated uncountable billions of dollars worth of productive farmland, and devoted it to – wait for it – forcing farmers to grow species *because* they are *descendants* of species *here before 1788* - that utterly urgent and important *aesthetic* value, more important than food to the starving!

Yet when faced with the anti-social chaos caused by government interventions, does it occur to the interventionists to call for government to stop doing what’s causing the problem in the first place?

Posted by Peter Hume, Friday, 20 May 2011 10:16:47 AM
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No way! True to the interventionist mindset, they wrongly externalize the blame to the market, and call for yet more interventions, as the author has done.

Remember all the other nations of the world have their own plethora of these kinds of government interventions restricting food production for the sake of less important values. And this is precisely why government cannot have primary responsibility for the food supply in the first place – they can’t do it without causing planned chaos.

As usual, the intended exercise of power exceeds the purpose for which it was granted. For example if China restricts the sale of apples, that does *not* justify food security policy action in response, because lacking apples does not prevent people having “ sufficient, safe and nutritious food to meet their dietary needs and food preferences for an active and healthy life”.

Besides, just because the UN states the ideal and full value of food security, doesn’t mean that the most expedient means of achieving that is by policy – by governments, rather than by markets. And the author has not made the slightest attempt to justify his completely false assumption to that effect.

And if he’s going to urge us on the authority of the UN, why not urge the UN on the authority of us to stop states strangling each other with food restrictions?

It was precisely such protectionist policies in the 1930s that was the economic cause of WWII. Free trading nations don’t need to physically own resources, but protectionist nations do. For example, Germany can’t grow coffee. Under free trade, it doesn’t need to – it can just buy it. But protectionist states can’t do that, and that is why they push for territory that will enable them to control the physical resources necessary for the full gamut of production. Protectionism is the economic basis of fascism.

“If goods don’t cross borders, armies will.”

To what extent have the author or Seamus taken account of the unintended but logical *downside* of their proposed coercive manipulation of other people’s freedom, property and livelihoods?
Posted by Peter Hume, Friday, 20 May 2011 10:18:43 AM
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We export over 60% of the food we produce. Are you suggesting we stop these exports?

The best food security for Australia is to grow as much food as we can at a profit, and sell it for the best price possible. A hungry world is a dangerous world.
Posted by DavidL, Friday, 20 May 2011 11:03:17 AM
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As the majority of the other posters point out, there is a lot wrong with the article and not all that much that is right.

The fact that 80 per cent of our diet comes from local farms, as opposed to 90 per cent 10 years ago is simply a reflection of the increasing diversity of diets and that many specialty products come from overseas.

However, it is straight nonsense to suggest that, somehow, Australia would run short of grain or beef, given how much we export. If apples become more expensive for a time because the Chinese have their problems, or bannanas vanish from supermarkets for a season because a hurricane has ripped through main banna growing areas, then so be it.

However, the author has performed on valuable service in making me aware that agricultural ministers now have "food security" somewhere in their title.. this is egregious nonsense which, hopefully, will not last.
Posted by Curmudgeon, Friday, 20 May 2011 11:22:59 AM
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