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Dale and Bob,
RE the thread on "subsidizing" farmers, etc.. First, I just have to take
issue with the labeling of farm programs as "pork barrels," whether or not
farmers ever receive a check from taxpayers. Legislating an "artificially"
high price might entail something like a government granted frachise
(certainly not a "monopoly"). And that is of course contrary to
neo-classical economics. Economists argue that such a franchise system
might require higher consumer prices and retard efficiency, but we should
remember that such a system might nevertheless be good for people, community
and the environment. My question is: do we grant economics the primary
place in setting our society's goals?
My main point is that agriculture produces not only food and fiber but also
a variety of "public goods." Some European friends are calling this
"multifunctional agriculture." This is in some respects a more robust
concept than "sustainable agriculture," because we're not talking merely of
avoiding negative externalities but also of positive services. The
following few paragraphs are edited from a Dutch paper by T.J. Aldington
called "Multifunctional Agriculture: A Brief Refiew from Developed and
Developing Country Perspectives." If anyone wants the whole thing, let me
know and I'll make it available when it's public.
Until recently, it is agriculture's negative environmental externalities -
pollution of water and air, loss of habitats and biodiversity and soil
erosion etc - which have received most attention from policy makers
(although some would argue that such attention is still insufficiently
developed), involving taxes or regulations to correct for market failures.
Yet, it is argued, agriculture also possesses positive externalities
(multiple functions), the related market failures of which merit policy
interventions such as subsidies or other means of agricultural support.
Government intervention need not be justified on public goods grounds alone
because there may be other valid reasons to justify intervention. For
example, the public sector may be better placed to assess and to take
countervailing action against risk than the private sector.
The following frequently cited functions are listed:
* Food security, including nutritional aspects, sometimes termed
'strategic.'
* Economic - income, employment (implicitly in rural areas)
* Ecologic - environmental protection, natural resource conservation,
including biodiversity, disaster prevention (floods, landslides), protecting
rural landscapes
* Social - viability of rural communities and hence maintaining rural
society.
Some of these functions also are interrelated or could be placed under
different categories. For example, protecting rural landscapes (an
ecological function), may promote tourism and hence generate rural incomes
and employment (an economic function), and so promote the viability of rural
communities (a social function). This feature suggests that there may be
synergy between the various functions but not necessarily so. For example,
protecting a rural landscape may be worthwhile because it maintains a
certain biological diversity even if it lacks the scenic value to promote
tourism. Or again, agritourism may generate employment but insufficient to
maintain the status of rural communities. It will depend on the situation in
hand. In any case the economic function - income and employment - is derived
directly from the primary production function and therefore is not an
externality.
Each of these functional categories is related to a range of policy
instruments with which to meet society's needs. Please, let's get a little
more sophisticated than the Republican objection to "subsidizing" farmers
when we don't subsidize mom-and-pop stores.
Hal
__________________________________
Hal Hamilton
Center for Sustainable Systems
433 Chestnut St., Berea KY 40403 USA
Phone: (606) 986-5336; Fax: (606) 986-1299
hhamilton@centerss.org
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