The problem Jardine is that your proposal is nether achievable nor realistic and if the entire theory were enacted we would have what I think was called a "robber economy" where the exercise of market power distributes recourses, where equity, is abandoned and individuals with more fire power (literally) have the power, perhaps the 1920's us. or perhaps some Russian economies, most of us prefer a more enlightened way to allocate recourses but more than that, a law of economics which not only can be supported by empirical evidence but actually describes how it is on the ground for those engaged has far more use and currency for our futures.
If you believe your theory you want a revolution...it will not happen and we must deal with what is.

Jardine K Jardine
I cannot agree that the cattle industry does not sell into a monopsony. At the very least it is a duopoly and on a regional level even worse.
You did not enter the discussion on my theoretical question about the buyer conspiring with others to cause a glut.
Do you have an opinion on any anti-trust laws?
The market failure of a price taking market where there are a large number of sellers selling to a few buyers is well recognised.
Initially when a market is deregulated after a period of protection it is theorised that efficiencies and innovation occur and the more efficient producers prevail.
It is also recognised that once this cycle has run its course it leads to poor profitability and capital rundown. many of our farm enterprises are at that stage now. They would benefit if many of the previously stated imposts such as environmental imposts were reduced.
The Tasmanian Forest Industries have been harmed by environmentalists visiting foreign boardrooms and persuading them to cancel orders of product which do not meet their specifications. Their claims are not always based on science but they get away with a plausible argument.

Mr Jardine....I think you are arguing just to be arguementative.

I have read your remarks and I am at a loss to see where you propose a workeable solution to any problem facing agriculture in Australia that have resulted since the Hawke/Keating government started this. All I see is negativity, and a call for government to get out of our lives. That will not happen! That's what governments do and why we elect them.

We have to show governments (of all political persuasions) that they have, by the blind following of a failed theory, inexorably led us over an economic cliff. Economies of scale was not the answer (shown in Ben Rees original article) Doha (WTO)has not been answer-it was the cause!

Your arguement about people having to pay for the support of farmers in Australia at the expense of overseas producers is indeed very peculiar - especially for a supposed Australian farmer.

The australian consumer should pay a fair price for Australian produced food, and not pay a cheap price for imported subsidised (directly and by stealth), by overseas residents, where the farmer receives more for his produce than it is sold for in Australia.

My pragmtic approach that you deny and call socialism, is not the philosophical theory of "pragmatism', of 19th Century U.States., but the more accepted common usage of : "advocating behaviour that is dictated by practical consequences than by theory or dogma" (Collins dictionary. p.1151) You seem to favour the dogma and theory over what is really happening.

It is sufficient to dispose all your arguments to note that you cannot answer the following questions without falling into self-contradiction or circular argument:
• what is the perfect or ideal state which alleged market “distortions” are allegedly a deviation *away from*?
• by what rational criterion do you distinguish the market rate from your alleged fair rate?
• if your assumption is correct that governmental decision-making on the allocation of resources is presumptively more productive and/or fairer, then why not have full communism?
• But if not, then by what rational criterion do you distinguish legitimate from illegitimate governmental decision-making on resources?

Nev
It’s you who are arguing that resources should be distributed on the basis of who has more firepower, not me. I’m arguing against it, remember?

Campaigner
I’m in a remote regional area and it’s not a duopsony where I sell my cattle.

But even if it were, the flaw in your theory is that this fact would justify coercive interventions. You haven’t given any reasons for that, any reason why tariffs or other such interventions would make society more productive or fairer – and I don’t accept your appeal to absent authority, on the ground that it’s a logical fallacy. Reasons, please?

My opinion on anti-trust laws is that I’m waiting to see whether anyone can justify their arguments in support of them on any rational ground. They seem to presuppose some ideal state which “trust” behaviour allegedly violates. What is that ideal, and why does infringing it justify coercion?

Fruitgrowered
The issue is whether protectionism makes society more productive or fairer. I’ve shown why it doesn’t, and you haven’t shown any reason why it does. To say unfair anti-social interferences with other people’s livelihoods is “what governments do” is not doubt true, but that’s not the issue.

If you can’t answer my questions you have no ground for claiming pragmatism over ideology. All it means is that you would like an arbitrary handout paid for with money taken from its owner and producer. No doubt government can: the question is whether it should?

Great article by Ben, describing how the so called VERSION of "free trade" that Australian politicians and bureaucracy peddle is flawed disadvantaging and failing to give Australian farmers and manufacturers the ability to compete in the market on a level field.
Being inefficient and being Uncompetitive are not the same in the current trading market that we have.
People can argue all you like about the benefits of "true" free trade or protected and subsidised trade but it wouldnt matter as long as it was FAIR TRADE with the playing field level no matter how it got there.
If its expected for farmers to receive global prices then wage earners should also expect global wages. Social and environmental policy must also be at the same level as our competitors, and yes our standard of living will be that of our competitors including crime, education and health care ect..., We would also need to scrap the games played by currency manipulation as this is the most effective protection method used and probably need to use a gold standard.
The article I dont believe is asking for favourable treatment for farmers but rather that they not be disadvantaged as compared to our international competitors or treated with lesser rights then those bestowed onto wage earners in Australia.

The irony is that it’s you guys who seem to be basing your criticisms of free markets on false assumptions from neo-classical models and ideology rather than reality and pragmatics.

We need to distinguish the two categories of reasons why markets are not a “level playing field” (dreadful term): market reasons and government reasons.

The “market” reasons are because the surface of the earth is variegated, labour rates are different in different places, the prices of the factors of production are different in different places, access to transport is different for different places, and so on.

There is nothing wrong with this. The problem is not caused by “ideology”, it’s caused by reality. The fact that these natural limitations prevent the market from complying with the abstract notion of “equilibrium” is not a reason for government to take any action whatsoever in an attempt to out-perform or “correct” the market.

The concept of equilibrium can be a legitimate tool of theory; because this *imaginary construct* of a stasis may give us useful insights into the dynamic reality.

But:
• There is no *ethical* superiority to the state of equilibrium
• It is only the state to which the market *tends* in the absence of new data entering the market. But new data always are entering the market!
• Equilibrium is a state of *non-action*. It is not a legitimate end and goal of policy.
• The equilibrium price is not knowable in practice, and all the pretensions of economists to know it with their statistical methods are false: mere gizzard-lore of high priests.
• It is not legitimate to define deviations from a standard of perfection – perfect knowledge, perfect information etc. – as “market failures”
• It is laughable and criminal to *assume* that government – of all things - has some kind of economic super-competence to correct the imperfections of ordinary mortals.
• Government does not have, and is not capable of ever having, the knowledge, the capacity, or the disinterestedness to level the playing field.