Bob ("Prisoner of Trebekistan") Harris notices how often U.S. media aids and abets counterproductive U.S. foreign "aid" policies.
The same people whose worship of the so-called free market allows them to demolish countries are the ones leading the Bush Administration's efforts to ensure that the global response to global heating doesn't adopt any heresies. Which is why our policy response to global heating has been zilch.
That's the headline of this front-page story in today's Globe and Mail, Canada's largest national newspaper, concerning how the African nation of Malawi has rapidly transformed its food economy from famine to surplus, saving countless lives:Back in the 1990s, the Malawi government gave the poorest farmers a package of fertilizer and seeds every year. The program was so popular that in 1999, they made it universal, for all farmers, and posted a large national surplus.Bottom line: food production is up 150%. But at what cost?
But starting in 2000, the donor nations on whom this country depends for nearly half its budget forced the government to scale back and then finally to scrap the policy, saying it "distorted the market" and would prevent a sustainable agricultural base.
The result? Smaller and smaller harvests and two years of famine.
[snip]
Starting in 2006, and on a larger scale this year, the government distributed coupons to low-income farmers to allow them to purchase 50-kilogram sacks of fertilizer for 950 kwacha($7) rather than the market price of 4,500 kwacha. As a result, the average farmer's yield jumped to two tonnes a hectare from 800 kilograms.The fertilizer subsidy cost the government $62-million - 6.5 per cent of the total government budget, a "whack of cash" in the words of one top economist - but that pales in comparison to the $120-million the government spent importing food aid in the 2005 famine. And the sale of maize to Zimbabwe and other countries will inject an additional $120-million into the national economy ...In other words, the subsidies only cost half as much as previous measures, and generated enough income to pay for themselves. Twice over. In addition to ending the famine.
This is, of course, pure sacrilege to those who hold "free" markets as a hallowed force of religious power. (Odd to see it front-paged in a national newspaper. Of course, I'm not in the US at the moment. I'm in Canada, where well-funded public health, education, transport, and educational systems would have destroyed the economy by now, if some disembodied heads on CNBC were remotely tethered to earth.)
My point here is not to promote or decry any particular economic agenda -- I have none, personally -- but to yearn for the sort of open-minded pragmatism that allows, y'know, a newspaper to actually report something useful like this without being instantly denounced for a breach of ideology.
What worked in Malawi may or may not work anywhere else. But it worked in Malawi.
Ideology apparently helped cause a famine. Moving past ideology helped stop one.
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Comments
View as Flat
Jon Rynn Posted 1:29 am
14 Oct 2007
By the way, one of the best critiques of the free-market was Jonathan Swift's "A Modest Proposal", a satire in which he proposes selling Irish babies for meat in order to mitigate an Irish famine.
There were also massive famines in late-eighteenth century India that the British refused to solve with extra food because it would interfere in the market.
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GreyFlcn Posted 3:15 am
14 Oct 2007
We give them a big pile of money, and only allow them to use it on some mega-project.
A lot of that money gets "displaced" due to corruption.
Then the project never really gets done, or the country can never really pay back the loan plus interest.
And then as a result, the world bank then tells them "You have to do this because you owe us money!"
_
And the real irony being that all we're really after is building infrastructure in their countries so that we can further make it into an extractive "colonial state".
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GreyFlcn Posted 3:18 am
14 Oct 2007
Quite the contrary.
http://greyfalcon.net/smith.png
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GreyFlcn Posted 3:26 am
14 Oct 2007
And later his pupil Milton Friedman.
_
But anyways, the thought of a "pure" market free of corruption, with low market entry barriers, unlimited resources, where all services and externalities are paid for, is just a utopian delusion.
It doesn't exist.
And thats why the whole concept of "Laize Faire" is much like a Religion. Or rather more like an authoritarian rallying dogma, when the real approach is to create uncompetitive markets.
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Delay And Deny Posted 5:56 am
14 Oct 2007
Africa, averaged as a continent, has the highest birth rate in the world.
Given their resources, you would think they'd have programs designed to cut back on child production.
John Bailo
Sutext:
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Biodiversivist Posted 1:55 pm
14 Oct 2007
This year you had good conditions, subsidies, lots of rainfall and the neighbours are short. If next year there is no rain and South Africa has a huge surplus - then what? It's just not true to say that the fertilizer subsidy has overcome all the problems."
But in the meantime, the fertilizer coupons stay. "We have no time-frame for ending subsidies; over the medium term they're going to be there," he said. "They will be phased out as income levels of farmers rise."
Canada is also apparently doing zilch:
http://www.washingtonpost.com/wp-dyn/content/article/2006 ...
http://www.treehugger.com/files/2005/12/canadian_oil_at.p ...
Laissez-faire--regulated free markets--socialism--communism. The two extremes are ideologies (similarities with religion). The ones in the middle, not so much.
In the end, it all comes down to biodiversity. Poison Darts--Protecting the biodiversity of our world
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Jon Rynn Posted 12:48 am
15 Oct 2007
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trock Posted 6:42 am
15 Oct 2007
The point could be made that this example doesn't exactly explain markets and there value.
What if these farmers were given money instead of the fertilizer coupons, they may have purchased classes that would have taught them how to grow the crops with natural fertilizers and also spent some money on better tools to work the land faster or hired extra labor if that was what was limiting the crop. Each farmer would have been to maximize their special circumstance.
Do I think they should have been given the fertilizer? You bet. But maybe they were lacking in other things as well. Or some had figured out the natural fertilizer thing and needed other help.
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wiscidea Posted 6:52 am
15 Oct 2007
Another victim of Jean-Paul Marat's ghost and his virtual guillotine?
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David Roberts Posted 6:57 am
15 Oct 2007
So why are we blaming "free market religion" for the present state of affairs?
Look at it this way: If I went around loudly proclaiming that I'm a peace advocate, and that in the name of peace I need to beat you up, would you blame my violence on "peace religion"?
grist.org
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wiscidea Posted 7:24 am
15 Oct 2007
If there was truly a free market... ALL costs would be incorporated into the price of each and every service, product, or resource. Clean air and water entering a factory would be clean and safe when it leaves the factory. And no one -- not a single corporation, small business, or individual, would receive a tax break, subsidy, or tax penalty for what they choose to do or sell. There would also be what I believe is call "transparency" regarding all services, products, and resources, so consumers could make an informed decision about what they choose to buy. Furthermore, advertising would present only facts and not be permitted to appeal to our reptilian or even primitive mammalian emotional urges.
Make petroleum importers pay for the quagmire in Iraq!!! That would be one step toward a free market as far as energy is concerned! Come on corporations! How about it? You REALLY want a free market?
Another victim of Jean-Paul Marat's ghost and his virtual guillotine?
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Gar Lipow Posted 7:52 am
15 Oct 2007
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Jon Rynn Posted 7:58 am
15 Oct 2007
And to second Gar, Americans used to talk about how they were very "practical", and "can do", not worried about ideologies -- that's what the Europeans did. Now it seems like that's reversed. It's time to get back to doing the practical thing, and not worrying about what it means ideologically.
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David Roberts Posted 8:11 am
15 Oct 2007
To me, "free" does not mean "unregulated." That makes no damn sense. A community with no laws is not "free," except in a very narrow sense of negative freedom. It's anarchy. The presence of choices and opportunities -- positive freedoms -- require a framework of laws and expectations.
To the point at hand, though, I just don't see the logic in ascribing the shape of our foreign aid programs to "free market ideology." Someone who was designing such programs based on free market ideology would create very, very different programs. The forces that guide these programs are not ideological, they are old-fashioned greed and power.
So why not lament the unprincipled pursuit of power and financial advantage? Why drag free markets into it, when there are no free markets involved and no policymakers trying to involve them?
grist.org
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Jon Rynn Posted 8:23 am
15 Oct 2007
Second, referring to the original post, the excuse given had to do with the phrase "distorting the market". Now, this may have been an excuse, but at the very least, free market ideology is used as a rationalization for "the unprincipled pursuit of power and financial advantage" (I'll have to remember that one). Some, such as Transafrica if memory serves, have talked about the exploitation of Africa mainly in terms of pure power, as does Chomsky quite regularly. So, yes, generally I like to look behind the curtain and see what is really going on, which is usually a power grab, but it's important to understand that, ironically, the idea of the untrammeled free market is an important ideological weapon.
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David Roberts Posted 8:31 am
15 Oct 2007
To me, then, the smart political strategy is not to accept the false marketing and inveigh against free market ideology -- thus placing yourself in the marginalized and ignored left -- but to point out that the policies in question are actually betrayals of the principles of open, free markets. We should be pushing for open, free markets, with externalities priced in and all players subject to the same laws, not accepting the fallacious marketing gimmicks of our opponents. We're letting them outplay us.
grist.org
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charlesjustice Posted 8:32 am
15 Oct 2007
The most glaring example is global warming. Free Market Fundamentalists continue to deny that it's a man-made problem because that would mean that governments should be doing something about it. Since it is the strongest evidence yet that the market does not lead to the general welfare they would rather stick their heads in the sand than deal with it.
Christian Fundamentalists are willing to deny half of modern science because the theory of evolution contradicts the Bible's account of creation. They'll do anything to deny the evidence including demonizing those who have the temerity to bring it to their attention.
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Jon Rynn Posted 8:44 am
15 Oct 2007
But that's not what free market means. You need a different phrase, or else it gets mixed in with free market, because free market types are not going to accept wiscidea's definition. Call the better market "full cost" markets, "real cost" markets, whatever.
Politically, I suppose you can talk about "market-based solutions" or something like that. But the "free market" ideologues need to be challenged, because they will use their talking points to fight global warming legislation, etc. Maybe you could say they're not really for the "free market", they're for a "theft market", or some such.
If market freedom is the economic analogue of political freedom, then employee ownership-and-control of firms should be the economic analogue of political democracy. But again, what kind of free market, i.e., full-cost or no-cost, needs to be specified.
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Gar Lipow Posted 11:20 am
15 Oct 2007
...is factually the case -- contra what Gar implied above -- that free markets are the financial analogue of political freedom, and open markets governed by laws (not men) have been one of the principal instruments pulling mankind out of various feudal arrangements and into the era of unbelievable plenty in which we find ourselves. In short, there are good reasons that free markets serve as a good marketing technique...
Depends on what you mean by "free markets". From the beginning markets have not only existed in the context of laws and regulations to create them. They also have depended on public infrastructure. Ships were largely financed by government loans, by piracy/privateering. If you focus in the North America and ignore slavery, land grabbed from the Indians and so forth, you still can trace public institutions that we had from our founding, or within the first two decades of it
1) A national bank that eventually became a series of state banks and then a national banking system again.
2) A national post office and a public mint
3) public schools, starting out in New England and spreading throughout the country after the Civil War
4) Transportation infrastructure - starting with Canals, going forward to rail roads then to auto and truck roads. Also bridges, airports, sea-ports and so on.
5) We tried private fire departments in the 19th century, and found that public ones work better. Similarly, private industry plays a bigger role in health care than any other rich nations. As a result we get worse health care then most other rich nations and pay two to three times as much per person.
In short we need to recognize that capitalism requires a whole lot of public infrastructure - which is why I dislike the term free market - it sounds like we either don't need government to play a role, or only need it as a rule-maker and regulator. There is a whole range of public and semi-public goods where markets, free or otherwise don't work well. It was not the "free market" that liberated us from feudalism - it was capitalism. And markets are only one part of both what was good and bad about capitalism from the beginning Capitalism is NOT a free market system. It has never been a free market system. There has always been a huge role for public infrastructure within it by necessity.
And this is relevant to the discussion of global warming - because huge parts of the changes we ened to make in are infrastructure, stuff that ha to be done publicly. Transportation, communication, and the electric grid are all stuff that takes place over public rights way. So does water and sewage. If you want thermal solar and wind to play a large role in our future energy system you are going to need a large public investment in long distance transmission and large scale storage.
This may or may not apply to solar cells as well. A lot of people think the technologies that have been only a year away for decades are now only six months away. If that is not the case then an argument can be made for the public building of a large scale solar cell factory as a sacrificial lamb. It would be able to sell PV cells for a dollar watt, creating a market that would attract competition to offer better quality for the same price, or the same quality for a better price or both.
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