An article on deforestation and carbon emissions caused by palm oil plantations in Indonesia:
The rise of palm oil goes back to the early days of the Bush administration of the 2000s, which pushed for biofuels as a path to "energy independence" in the aftermath of the 9-11 terror attacks. In retrospect, this is all about patronage to American soy and corn farmers. (IIRC, the Bush administration increased farm subsidies by 80% in 2003.)
Comments by liberals claim that biofuels are really a big corporate scam benefiting "agribusiness". That is true in Indonesia, but in the USA, the real culprit is smaller farmers, who are struggling because they are economically obsolete.
Technological innovation drives down costs. For example, the cost of smartphones has fallen 5% a year since the since the iPhone was introduced back in 2007. Recently, a farmer interviewed by the NYTimes claimed that corn prices keep falling, but the only person who seems to care about the fate of farmers is Donald Trump. Unfortunately for her, because of new technology, the price of corn and smartphones will someday go down to almost nothing.
The future of farming is big, efficient farms that do not require subsidies.
Kip Tom is recounting a forum he attended in Washington, D.C., as Congress debated a new farm bill, and you’d think he had just run into a co-worker at the office water cooler. “You’ll find this to be true with most of the new farmers: We don’t like to be subsidized,” he says. “I had this conversation with the secretary of agriculture about two weeks ago.” That is, U.S. Secretary of Agriculture Tom Vilsack, who stands nine places behind the president in the line of succession. “He said, ‘What can we do for you, Kip?’ And I said—you probably won’t want to put this in your article—‘You need to get the hell out of our way. Let private industry do what it does best: conduct business.’”The plight of America’s small farmers is not news; you might remember the 1980s, Farm Aid concerts, and John Mellencamp’s protest song “Rain on the Scarecrow.” A decade earlier, Secretary of Agriculture Earl Butz (an Indiana native and former ag-school dean at Purdue), buoyed by high grain prices and a strong export market, had announced that U.S. farmers should “get big or get out.” Many took up the call, taking out high-interest loans to acquire acreage and equipment.When commodity prices withered, overextended farmers were stuck in the mud. In the 10 years following 1982, Indiana lost more than a thousand 200-acre farms—a quarter of them. The blood, as Mellencamp sang, was on the plow. But farmers positioned to weather the financial drought were able to buy up cheap land and take over leases left behind by operators who’d bitten the dust.Mechanization—widespread as early as the 1930s—helped make consolidation inevitable: Simply put, farming now requires fewer hands. And you don’t have to look any further than Walmart to know that big businesses have inherent advantages. “With economies of scale, you can spread your fixed costs over more and more units,” says Chris Hurt, a professor of agricultural economics at Purdue. With their lower cost of production, already-large farmers can outbid smaller competitors when land and leases become available (which isn’t often), making it hard for the little guys to scale up their operations.
One solution might be to adopt the French practice of "viager", which somewhat resembles a reverse mortgage. An investor buys a property from an older seller, but pays for it over time while the seller lives in it or rents it out; upon the death of the seller, the property fully reverts to the buyer. The investor would be the US federal government, to whom ownership of the farm would pass rather than to an heir. When the farm eventually passes into government ownership, the farm would be sold to a bigger, more viable entity.
In agriculture and manufacturing, economies of scale apply. In the service sector and creative professions, economies of density apply. But in both cases, the rule is that one must GET BIG OR GET OUT.
Small towns are now economically obsolete, and smaller cities are at a disadvantage. Cities must do whatever they can to increase their population, density and economic diversity.
Perhaps the only way to do this is to expand major cities because medium cities might not have the vitality to expand. One solution might be for major cities to expand inland. Major cities are typically located on coasts, but there is no longer any inherent reason for this. (Ocean travel was once the cheapest mode of transport, but now it is less expensive to load cargo from Asia onto land transport on the west coast of the USA and send it east on land than it is to have it pass through the Panama canal.)
A map of population density in the USA:
Every major city would expand aggressively inland. So the areas between San Francisco and Reno would be mega-developed, as would the area between Los Angeles and Las Vegas.
Get big or die. That's the new reality. If a city is losing population, that is like the early stages of cancer. (The decline of a modern city might be similar to Ernest Hemingway's famous description of going bankrupt: At first slowly, then rapidly.)
One source of opposition to the further development of the city is urban populism. Cities are where the oddballs of the nation gather, giving the city its diverse, experimental character, but now these people are being priced out by creative talent, by the professional classes and by corporate management.
This urban populist critique is problematic for a couple of reasons. One is that cities are always changing and some people are always being compelled to leave, but this does not mean the death of either the city or of those who are leaving. (The recent slogan "Keep Portland Weird" is problematic because historically Portland, Oregon was bland and normal. The kind of eccentrics who used to gravitate to San Francisco were priced out in the 21st century and so they ventured north. But now the yuppies are also moving north. Neither Portland nor the oddballs who might now leave Portland are going to perish.)
Also, the role of the city as the refuge of eccentrics is now redundant with the social changes that began to accelerate in the 1960s and the technological innovations that became widespread in the 21st century. The conservative urban theorist Joel Kotkin claims that so many of the unique attractions of the city -- exotic restaurants, foreign cinema, coffee shops, rare books, vintage clothing stores -- are now readily available in the suburbs, and that this represents a decisive victory of the suburbs over the city. (This might be called the "Netflix effect".) Geographically, it might be true that the suburbs no longer lack the amenities of the city, but culturally this represents the spiritual urbanization of the suburbs. (Also, most American cities -- with the notable exception of NYC, San Francisco and New Orleans -- are infamously similar to one another and somewhat generic. So the cultural enrichment that stems from the Netflix effect also applies to American cities, not just suburbs.)
But far more powerful in American life than urban populism is anti-urban populism. Americans don't seem to like cities, and this might be tied to an American distrust of concentration of economic power (Democrats) and governmental power (Republicans). That is, Americans don't like concentrations of geographic power, either.
Here is an unfinished 105-story pyramid-like hotel in North Korea that looks like something out of Blade Runner. Understandably, Americans hate and fear that.
Unfortunately for those Americans who most hate cities, over the past two centuries, everything has changed.
The American economy was originally based on small business. Alexander Hamilton's vision of a dynamic economy based on big banks, big business and a big, active government would not become relevant until the 20th century, when progressives would seek to regulate such great enterprises rather than destroy them. Moreover, in the 20th century, there arose a new concern that shifted energy away from the traditional worry over bigness: consumer protection. Indeed, big business promoted consumer interests.
Often, in fact, economic giants destroy smaller competitors by obsessive attention to consumer preferences. If Walmart drives a small-town general store out of business, that’s bad for the general store but not necessarily bad for consumers concerned with price, selection, and quality. Amazon has hurt bookstores and publishers not by fleecing consumers but by offering them improbably low prices, vast selection, and quick delivery. The rise of agribusiness has hurt small farmers—and lowered food prices in the supermarket. Today, you’ll often hear eloquent defenses of the small producer, rather than the consumer, but they are usually limited to an area where the defender has a particular concern. Amazon’s critics in the literary world seldom fret about its effect on the lawn-care industry. Tim Wu’s 2010 book “The Master Switch” proposes a “Separations Principle” that would include forced breakups of monopolies, but only in information industries. When such arguments are made in realms other than our own, we tend to regard them as the special pleading of an interest group.
There is still some push back against bigness. The following editorial laments that "monopolies" have become more dominant over the last 15 years.
The federal government, under presidents of both parties, has largely surrendered to monopoly power. “The ‘anti’ in ‘antitrust’ has been discarded,” as the legal scholar Tim Wu puts it in his new book, “The Curse of Bigness.” Washington allows most megamergers to proceed either straight up or with only fig-leaf changes. The government has also done nothing to prevent the emergence of dominant new technology companies that mimic the old AT&T monopoly.Mergers are one big reason. Another is the power of so-called network effects — in which the growth of, say, Facebook makes more people want to use it. True, a few industries have become less concentrated, but they are exceptions. If anything, the chart here understates consolidation, because it doesn’t yet cover energy, telecommunications and some other areas. It also doesn’t cover local monopolies, such as hospitals that are dominant enough to drive up prices.
The chart illustrates corporate consolidation that is most egregious in sectors like hardware stores, shipbuilding and tobacco. My understanding is that most of those areas have long been in decline.
My own pet theory is that innovation creates temporary monopolies that should be regulated as public utilities; eventually, they succumb to competition; finally, they become obsolete legacy systems that should be subsidized by the government in modest form to assist underprivileged communities. Moreover, historically, as economies grow and diversify, each succeeding "monopoly" becomes less central to the economy and is not a true monopoly that owns all the infrastructure in its sector (e.g., compare Standard Oil to Google). Notably, consolidation is, in fact, a sign of obsolescence, as floundering competitors are purchased by companies who are themselves desperate to grow. So if AT&T wants to buy TimeWarner, it is a symptom that AT&T is entering obsolescence, just like AOL before it.
One of the comments notes that just six corporations now own 90% of the media.
This is disturbing not because of the specter of media monopolization, but because the media is now in decline, obsolete and doomed. So perhaps the right thing to do at this stage is not dismantling media conglomerates, but creating state-subsidized media, like the BBC.
The current criticisms of "monopoly" seem to be two-sided or Janus-faced. There is a liberal or even radical critique mixed with a conservative nostalgia for the good old days when things were smaller and simpler. An example of this mixed sentiment might be found in the 2016 Ken Loach film "I, Daniel Blake", about an old, ill carpenter who falls through the cracks of the British welfare system. The film laments that there was once a time when men could be stand on their own and make things with their own hands, but now everything is on the Internet. It's a confused critique.
"Mortal Engines" likewise disguises conservative nostalgia as youthful rebellion against the modern city.
We now live in the large, open, dynamic meritocracy envisioned by Alexander Hamilton, but in our hearts we still feel the anti-urban, anti-modern, anti-elitist instincts of Thomas Jefferson. Thomas Jefferson lives.
(The tech sector is also populist, especially social media. The idea of "disruption" is very appealing to Silicon Valley because they saw themselves as the populist rebels of Star Wars, tearing down economic and political monopolies. It was only after the disappointment with the Arab Spring in 2010 that Silicon Valley began to see disruption of the status quo and even populism itself as potentially dangerous. Moreover, in the USA, it was ordinary people's lives that were getting disrupted, and the tech industry was being perceived as the new monopoly. There was then a shift in Silicon Valley toward focusing instead on philanthropy and buying estates in New Zealand as safe havens from populism. The idealistic and brilliant but rather obtuse Mark Zuckerberg remains a stubborn exception to this trend. The point is that even the new tech mega-corporations saw themselves as populist anti-monopolies.)
The anti-monopoly populism of the American Revolution forms a long continuity up to the present day. It always had a side that was dangerous and ignoble.
On the other hand, opposition to populism was also problematic. To be honest, Alexander Hamilton was an ambitious imperialist who dreamed of greatness for the USA and for himself.
The point is to avoid either valorizing or demonizing historical figures and instead to put the current state of affairs into historical context. Ten thousand years ago, the Agriculture Revolution was the ur-disruptive innovation (gardening replacing hunting and gathering), enabling billions of humans rather than a dozen million humans to live on the planet Earth. For the past 300 years, the Industrial Revolution has increasingly automated rural life. If the "Godfather" movies were all about the beginning of the end for the mafia, the "Sopranos" was about AFTER the end. For the small family farm, the beginning of the end was 300 years ago, and the end came in the 1970s. We are now well into the postmortem phase of the family farm.
(In the 2017 documentary "Faces Places", a French farmer incredulously discusses his current work life, in which he gets up in the morning, climbs into an air-conditioned tractor, presses a button and lets the tractor do everything but steer. In the future, tractors will be self-driven. There will always be farms, but in the future, no farmers. The situation might even be worse in Mexico than in the USA. Because of NAFTA and the hyper-efficiency of American agriculture, tens of millions of Mexican farmers are now obsolete, especially corn farmers.)
NAFTA went into effect on January 1, 1994, and was greeted by an armed revolt: Zapatista fighters, their faces covered with bandannas and balaclavas, seized a series of towns in Chiapas. The Zapatista leader Subcomandante Marcos called the trade alliance a death sentence, arguing that it would destroy Mexico’s rural economy, force dependency on American imports, and increase the disparity between rich and poor. Twenty-three years later, Mexico’s economy has been transformed, especially in the north, and a new middle class has emerged. But a number of the Zapatistas’ assertions have been borne out. The agricultural sector, centered in the mostly indigenous southern regions, has been devastated. Towns and villages that relied on the sale of produce have seen their markets collapse, and many have fallen into surging criminal economies imposed by drug cartels. At the same time, Mexico has become utterly dependent on the U.S. for economic viability. Several people I spoke to pointed out a particularly painful absurdity: even as farming communities struggle, the country imports corn from the U.S. The prominent journalist Alejandro Páez Varela spoke bitterly of Mexico’s reliance on the U.S.: “It’s made us one of the most obese people on earth, because we are now mass consumers of American junk food. It has created a class of superwealthy, consisting of a couple of dozen people who are closely linked to political power. It’s created fifty-three million very poor people for whom the only solution is to emigrate, en masse, to the United States and send remittances home.”
Small farmers in the USA may be Jeffersonian anti-elitists, but they want a big Hamiltonian government to permanently subsidize their precarious way of life.
Perhaps if that big government does have a realistic role to play in sustaining small farmers, it is to offer them a humane way to transition away from farming by generously buying them out.
Ten thousand years ago, farming was the great innovation that came to monopolize human life, but is now an obsolete legacy system that needs to be sustained in order to assist disadvantaged communities. But this assistance should not be in the form of continuing to perpetuate obsolete small farms, but in offering them a graceful way out. A compromise between the dynamic urban areas and decaying rural areas would consist of a Marshall Plan for rural America in which the US federal government would buy out farmers.
It was always about compromise. Here is John Adams looking for a compromise between Hamilton and Jefferson. (Note Jefferson's hostility toward "all cities".)
The importance of compromise cannot be understated.
Two thousand years from now, when historians study American civilization, there will be only three things that will be remembered: baseball, jazz and the Constitution. They are characterized by improvisation.
What each of the three subjects daily reminded us was that the genius of America is improvisation, our unique experiment a profound intersection of freedom and creativity, for better and for worse, in nearly every gesture and breath.
But they are also characterized by compromise.
First of all, Burns seems to imply that baseball, jazz and the Constitution are examples of pure improvisation, but that would be exaggerated. There is a greater framework that is already established within which improvisation takes place, even though the framework is itself a preexisting creative product. For example, within a jazz song there is improvisation, but the song itself is somewhat fixed, created some time ago. The same could be said of the process of writing the Constitutions, a tradition which goes back to the ancient Greeks.
Second, Burns also might be implying that jazz and baseball embody improvisation in the performance of every jazz group and baseball team, whereas the Constitution embodied improvisation only during its original drafting in 1787. But the Constitution, and law in general, is continuously improvised because legal judgment is itself a creative enterprise. As anthropologists point out, marriage customs and other rituals are subtly altered by their reinterpretation. The trick is to find a new interpretation that is a form of compromise that does not feel like a great departure from the original.
Indeed, the typical historical account of the writing of the Constitution usually emphasizes the bitter compromises that went into its original construction. Jazz and baseball are likewise marked by compromise, notably by teamwork punctuated brief periods in which a particular player takes his turn and steps up to bat or does a solo. And compromise is itself a creative endeavor.
But back to creativity. There is a saying often attributed to George Washington or to Jefferson that "I am a soldier so my son can be a farmer, so that his son can be a poet or politician." But the saying was inspired by something John Adams wrote to his wife.
I must study Politicks and War that my sons may have liberty to study Mathematicks and Philosophy. My sons ought to study Mathematicks and Philosophy, Geography, natural History, Naval Architecture, navigation, Commerce, and Agriculture, in order to give their Children a right to study Painting, Poetry, Musick, Architecture, Statuary, Tapestry, and Porcelaine.
Letter to Abigail Adams, May 12, 1780
Typically, we think that the sciences should be supported in order to develop technology to improve the material standard of living for the general population. But one could argue that the reverse is actually true, that societal prosperity should be sought in order to promote technological development in order to advance the sciences. John Adams might add that the purpose of science and technology is to promote the arts. This is the original purpose of America.
The money that is going into subsidies for obsolete industries should be going instead into scientific research.
