Wednesday, November 22, 2006
As governor William Bradford commented on the dreadful conditions of 1622:
" . . . the young men . . . did repine that they should spend their time and strength to work for other men's wives and children without any recompense. The strong . . . had not more in division . . . than he that was weak and not able to do a quarter the other could; this was thought injustice. The aged and graver men to be ranked and equalized in labors and victuals, clothes, etc . . . thought it some indignity and disrespect unto them. And the men's wives to be commanded to do service for other men, as dressing their meat, washing their clothes, etc., they deemed it a kind of slavery, neither could many husbands well brook it.""For this community of property (so far as it went) was found to breed much confusion and discontentment and retard much employment that would have been to their benefit and comfort . . . all being to have alike, and all to do alike . . . if it did not cut off those relations that God hath set amongst men, yet it did at least much diminish and take off the mutual respects that should be preserved amongst them."
In the Spring of 1623, they moved away from Socialism and embraced the incentives of Private Property and Capitalism:
"All their victuals were spent . . . no supply was heard of, neither knew they when they might expect any. So they began to think how they might raise as much corn as they could, and obtain a better crop than they had done, that they might not still thus languish in misery. At length . . . the Governor (with the advice of the chiefest among them) gave way that they should set corn every man for his own particular, and in that regard trust to themselves. . . . And so assigned to every family a parcel of land . . . "
"This had very good success, for it made all hands very industrious, so as much more corn was planted than otherwise would have been by any means the Governor or any other could use, and saved him a great deal of trouble, and gave far better content. The women now went willingly into the field, and took their little ones with them to set corn, which before would allege weakness and inability, whom to have compelled would have been thought great tyranny and oppression."
Thanksgiving is therefore about freedom, private property and the unrestrained ability to worship and show thanksgiving.
Monday, November 13, 2006
George Washington certainly felt that the celebration of Thanksgiving could not be divorced from any religious connotation, as indicated in the following Thanksgiving Day proclamation:
"It is the duty of all Nations to acknowledge the providence of Almighty God, to obey his will, to be grateful for his benefits, and humbly to implore his protection and favors."
Although certainly not as revered as the Birth of Christ, it is as much a religious holiday as Christmas, Easter or Passover. Unfortunately this aspect of Thanksgiving has been downplayed in our schools and replaced with teachings about tolerance and ethnic diversity. They have been so successful at this there is no wonder that when it comes time to talk about Thanksgiving in the classroom, virtually no one opposes. This is because the celebration has become completely divorced from its true meaning, and hence is uncontroversial to the secularists.
They have not been so successful with Christmas, however the attempts to divorce this holiday from all historical meaning are well underway. We are seeing 'Christmas' replaced with 'Holiday.' It is done in the name of tolerance and diversity awareness.
It was in 1789 that George Washington gave the above Thanksgiving Day Proclamation. By 1989 its celebration has already lost much of its true meaning as taught in the schools and celebrated by many. I wonder what will be the fate of Christmas in the year 2089?
Thursday, November 09, 2006
This blog primarily has a focus on science and economics (in sorts a study of capitalism), which certainly are influenced by government. In light of this and the upcoming Thanksgiving Day holiday (which is a celebration of the triumph of providence, capitalism, and agriculture) the next few series of entries will carry this theme- taking a brief rest of the previous focus on organic foods.
Friday, October 27, 2006
Recently, a team of researchers at Advanced Cell Technology reported in the journal Nature that they have been able to remove singe cells from human blastomeres (cell groupings that result from mitotic divisions of the embryo) and coax these cells into forming embryonic stem cells with no harm to the embryo. If this procedure can be replicated successfully, then one side of the ethics argument may become irrelevant.
Monday, October 23, 2006
Both individuals are confused about where they should focus their criticisms. The 2nd amendment of the constitution makes clear that all people are to have an unfettered right to bear arms, with no exceptions mentioned regarding concealment or otherwise.
While the politician may have felt that he won a victory for the 2nd amendment, the fact that a bill had to be introduced at all is testament of our government not recognizing protected constitutional rights. He should have taken his passion to the Supreme Court, who should simply side on the basis of a literal interpretation of the constitution. My colleague, while disgusted with the politician, should realize that his true focus should be on amending the constitution to restrict the use of guns.
Of course, to the disgust of all of us, this is not likely to happen. It is in the best interest of each legislature to push through every bill necessary to maintain power, and our courts do not have a reputation of standing in the way. This process has been coined ‘ the quiet repeal of the American Revolution’ by economist Thomas Sowell in his book ‘The Quest for Cosmic Justice.’
Why is this relevant to this blog? This blog is devoted to science and economics, and both are heavily influenced by the way we are governed. In fact, many of the things that I have written about are in response to potential governmental and political behaviors.
Friday, October 20, 2006
-Leslie Hoffman, Director, Earth Pledge
" Over the next 10 years. I predict the mainstream of the environmental movement will reverse its opinion and activism in four major areas: population growth, urbanization, genetically engineered foods, and nuclear power."
-Founder, The Whole Earth Catalog
"You couldn't feed more than 4 billion people on an all organic diet."
-Norman Borlaug, Winner, Nobel Prize for accomplishments in agricultural advances benefiting the 3rd world.
Wednesday, October 11, 2006
According to a University of Minnesota study, researchers determined that produce grown with manure aged 6-12 months was actually 19 times more likely to be contaminated with E. coli than foods grown with manure aged more than a year. USDA organic rules allow manure to be applied after just 3 days of composting—right up to harvest time and raw manure can be applied until 90 to120 days prior to harvest in most cases.
It’s true that conventionally growers may also use manure as part of their fertility program, but in a recent study published in the Journal of Food Protection, organic produce was 6 times more likely to be contaminated with E. coli than conventional produce. Conventional growers always have the option of reducing manure use and supplementing with synthetic alternatives that offer the same nutritional value with less risk and increasingly less damage to the environment as genetics and technology improve.
Perhaps that’s why the founder of The Whole Earth Catalog believes the environmental movement will soon reverse its trend of aversion to GM foods.
Saturday, September 16, 2006
Let’s look at the properties of these chemicals as they relate to environmental health.
PERSITENCE: Roundup (glyphosate) has a half-life of 47 days vs. the much longer periods of those chemicals it has displaced.
TOXICIY: The chemistries roundup has displaced are 3-16 times more toxic.
So we have a GM crop that enables producers to use chemicals that are less toxic and less persistent in the environment than conventional crop production systems.
Perhaps this is why 73% of consumers say they are willing to accept GM products because of their potential for improving safety and environmental impact.
Source: Agricultural Outlook ERS/USDA Aug 2000
Friday, September 01, 2006
Restrictive environmental laws that decrease the incentive for oil exploration, the building of refineries, and expanding our electrical grid all lead to ( at least to some degree) increased market power for incumbent corporations. If anyone complains about ‘price gouging’ and ‘abnormal profits’, these are the polices that help make it possible.
Free markets, growth, and investment are perhaps the best solutions for achieving energy stability that is in the interest of everyone as opposed to just politicians and big business.
Monday, August 21, 2006
It is assumed that the benefits we will reap from ‘preventing’ global warming will outweigh the costs of the polices themselves. If it were possible to stop global warming via human oriented policies this might be true in theory. Because human influence on the climate is likely trivial, policies that try to subvert human behavior to prevent global warming are not likely to be successful. Once this is realized, the costs to economic growth and human welfare really stand out.
According to a researcher at Wesleyan University, stabilizing emissions at 1990 levels could reduce US per capital growth by 5% per year. ( an entry on the importance of economic growth soon to follow). The infrastructure problems that currently are causing high gas prices would only be exasperated by piling on more regulations that can only restrict supply and exasperate the problem. While research and development of alternative energy sources may be a better alternative, technology development and adoption is made possible in conjunction with investment and economic growth. Policies that impede this in the name of preventing global warming will certainly minimize private sector incentives in this area despite any funding from government.
The best solution for dealing with climate change is to develop resilient economies that are able to invest in the technology necessary to adapt to ever chaining resource constraints.
Wednesday, August 16, 2006
Many of the models that ‘predict’ or ‘explain’ anthropogenic global warming include parameters that are essentially assumptions about which we have little firm data to be certain about. These include the effects of cloud formations, precipitation, the role of oceans, and the sun.
Inherent in almost all dialogue and reporting about what these models imply is the assumption that human behavior is a large contributor to global warming. Although the climate has been warming over the last century, most of the warming occurred before 1940 (when temperatures in the arctic were actually just as warm or warmer than they are today). This was in the very early stages of modern industrialization and hence human production of greenhouse gases and CO2 on a large scale. This assumption about human influence is not supported by any empirical evidence, despite its widespread use as anecdotal support for what is implied by mathematical models.
Tuesday, August 08, 2006
With the sweltering heat this summer, while many don’t take it as direct evidence of human influence, it at least brings the topic of global warming to the forefront of their minds. I don’t know how many times I have seen good morning America do a story on recent weather events and link them to global warming caused by human progress. The media, MTV, and academics all love to share the stories and legends of global warming.
Legend 1: The warming earth is causing the polar ice caps to melt. – Real data stands behind the fact that the arctic temperature was just as warm in the 1940’s as it is today and possibly warmer. A recent issue of Science indicated that in some areas ice sheets are actually growing.
Legend 2: The recent increase in major hurricanes has resulted from global warming. –The truth is while hurricane activity may be picking up; it is due to the ordinary multidecadel time cycles that govern sea surface temperature and hurricane intensity.
Global mean surface temperatures have increased by about 1 degree over the last century, however satellite data indicate that there has been no increase of atmospheric temperature since 1979. While the green house effect is an accepted phenomenon, and while levels of green house gases have increased over the last 100 years, there is no way to prove that human activity is causing global warming. Making this assumption is pretty bold, but the increased speculation about hurricanes and melting ice caps really pushes credulity to the limit.
Tuesday, July 25, 2006
Their premise is that it is not natural to take genes from one organism and implant them in another. What are we talking about when we say 'genes'? Heuristically speaking, genes consist of a specific sequence of DNA base sequences (guanine,cytosine,adenine,and thymine) that lead to the expression of traits.
With traditional plant breeding, we develop plants with superior arrangements of DNA base sequences via the transfer of thousands of genes from one plant to another. These arrangements represent drastic changes in plant characteristics that would not have occurred naturally. (for example, modern corn scantly resembles its ancestor teosinte) Since the 1960's scientists have also been engaged in what is referred to as mutation breeding. In this procedure plant cells are attacked with gamma rays inducing ‘unnatural’ new combinations of DNA base sequences. Much of the pasta consumed in the world today is derived from wheat developed via mutation breeding. These changes to plant DNA are much more extreme than what molecular biologists are doing in the laboratory today.
Unlike traditional plant breeding methods, the laboratory techniques of molecular biology that are used to create ‘transgenic’ or GM plants induce very specific and precise changes in plants. The rearrangement of DNA base sequences is known and controllable. While these combinations would not have occurred naturally, the base sequences are common to all organisms and are as natural as can be. One could argue that the risk associated with these modern techniques is much less than with traditional crop improvement methods.
Wednesday, July 19, 2006
In this case it is the position of the media and other critics is that we should divorce ethics from science with regards to public policy. Science is a pure and objective standard upon which public policy decisions should be based, while ethics (especially Judao-Christian ethics) are equated with irrational biases and ignorance.
This hypocrisy, inconsistency, and intellectual dishonesty becomes apparent when the debate shifts from stem cell research to genetically modified foods. In this case science is equated with corporate greed and exploitation. It follows that science has been corrupted by the profit motive and is no longer objective, so we must rely on ethics or theories of environmental justice and social justice to guide our decisions.
Scientific solutions to problems always have implications for human welfare. It follows that in every case questions of ethics (often influenced by religious beliefs) arise. An honest media will portray these issues as two separate debates and steer away from the false dichotomy of science vs. ethics. One debate should be framed in terms of empirical facts regarding the soundness of the science involved. The other should encompass ethical considerations whether they involve theories of social justice, religion, or normative economics. It is irresponsible for the media, academia, or politicians to choose sides in a debate and then present it as a contest between enlightened scientists and religious nuts.
Thursday, July 06, 2006
We have more than a 40 year track record for safety with regards to more drastic crop improvement techniques such as chromosome doubling and mutation breeding. Some believe that we have taken our concern for safety too far, leading to hampered long term advancements in public health.
Wednesday, June 21, 2006
Transgenic/GM crops must go through multiple layers of testing before they can be approved for production and especially for human consumption. This costs millions of dollars, and creates a barrier to entry for new biotech startups and universities- all of which could be producing the science necessary for improved and sustainable healthy living.
The same regulatory agencies involved in ensuring that our food is free from pathogens, allergenic, mad cow disease, and that our medicines are safe as well- are responsible for the safety of biotech crops. The opportunity cost to our health and the world that we are bearing in the name of 'safety' in nutrition is huge.
Wednesday, June 14, 2006
Of course the resulting trans-fatty acids are unhealthy. And of course CSPI is once again behind on their awareness of the current state of science and technology. "The beans are already in the ground." Low-lin beans that is. PioneerHi-Bred International, Inc( a subsidiary of DuPont) is now marketing and farmers are now planting soybeans with altered fatty acid profiles with lower levels of linoleic fatty acids that obviate the need for hydrogenation.
In a few years time, with more genetic and supply chain improvements they will likely be the norm for food ingredients. This is the market's response to both consumer desires and the uncertainty created by frivolous litigators like CSPI. Why waste everyone's time and money with a long drawn out lawsuit, or worse a government intervention, when we have the technology and incentives to correct the problems through institutions and forces already in place.
Of course the low-lin trait is stacked with other positive environmental health traits like glyphosate resistance. (i.e. Genetically Modified), which I am sure CSPI or other anti science and anti freedom gainsayers will oppose.
Friday, June 09, 2006
Of course, their logic is that schools should teach students to live healthy lifestyles and make healthy choices. But this is not what is being taught by example. By example, this ruling would be showing children that the state defines what a good choice is and has the power to ensure that we make that choice. It teaches that experts are better able to decide what is better for the lowly pedestrian subject who claims ownership to his own body. (and by extension his family and property)
This approach would however work better teaching a subject like mathematics. Even though math is a very important subject, in my high school they did not force everyone to learn algebra. Instead they re-invented pre-college mathematics through storytelling and arts and crafts. How can we give students a free hand to make their own choices about the correct answer to a math problem through creative writing( which many modern high school math courses emphasize opinion over fact as mine did), and then act like tyrants when it comes to personal choices where opinion actually matters.
The role of the school in this matter should be EDUCATION. Teach mandatory courses about nutrition and the possible consequences of lifestyle choices. Maintain a mandatory year-round physical education curriculum. Let the life they live be the final exam.
Monday, May 01, 2006
Ultimately these firms need to invest in increasing their capacity. The high costs of environmental compliance have reduced profitability and have acted as barriers to entry, resulting in decreased supply, competition and higher prices.
Now both republicans and democrats have entertained the idea of ‘recapturing’ big profits by windfall profit taxes or repealing tax credits for ‘big oil.’ Part of their rationale is that oil companies have done nothing to ‘earn’ these profits and therefore do not ‘deserve’ them.
They forget the role of profits is not only to reward those producers who do the best job filling our most urgent needs, but they also have an essential role in directing resources to where they are in need most. And to relieve the oil markets we need those profits to encourage investment, competition, and ultimately increased supply of oil and gas. Recently Shell has proposed plans to build the biggest refinery in the US.
The idea that oil companies have done nothing to ‘earn’ high profits is farce. It is fuel that makes it possible to get our food safely to the table, provide medical care, deliver goods and services, and exercise our greatest freedom to come and go as we please. By definition profits represent the net contribution a firm makes to society. When it comes to energy, oil companies have a lot to contribute.
If workers don't want to be exposed to cigarette smoke, then they can choose other work. This is no different than avoiding other hazardous jobs in agriculture, mining, or high rise construction.
If consumers and workers are willing to bear these costs at first and if the choices of FREE individuals (the market) dictate then smoke free facilities will arise to meet their needs. We have already seen this with restaurants like McDonalds and many other family restaurants.
With each choice there is a cost that must be borne by the consumer or worker. They may have to choose a different restaurant or job. . The effort to ban smoking is a pusillanimous attempt by such interested parties to force others to bear these costs, and to get quick results overnight. Also if you assume that the air in the restaurant that you own is part of the bundle of property rights associated with owning the establishment, then such a ban on smoking should be considered a "taking" of this property. The owners of these establishments should be compensated for the loss of property rights and financial damages that result.
If our own well being and safety in such small matters are reason enough for such an intrusion on our liberty, then such government policies will not stop with cigarettes. They are only the most obvious starting place. Fast foods, buffets, baking goods, and genetically modified foods could be next.
As Thomas Jefferson said long ago: “The issue today is the same as it has been throughout all history, whether man shall be allowed to govern himself or be ruled by a small elite.”
Monday, April 24, 2006
What happens when we take both of these effects into account? The decreased profitability acts as a barrier to entry preventing competitors from entering the market or increasing capacity. In fact there hasn't been a new refinery built since 1972. When demand exceeds supply, prices rise but there is very little supply response. As a result prices remain high for longer periods of time.
With barriers to entry, there are fewer 'players' in the price gouging game. With fewer players, it takes longer for the market to converge to the lower priced Nash Equilibrium.
Although environmental regulations have reduced return on investment, the resulting barriers to entry have increased the market power of existing firms. In essence, it is environmental regulations that make it possible for firms to ‘price gouge’ because of the increased market power that these laws create for oil companies.
Wednesday, April 12, 2006
As result return on investment dropped 42% per year between 1996 and 2001. With reduced ROI, refining capacity is severely limited, and the profitability of expansion is greatly reduced.
The recently hailed 'record profits' that oil companies have posted since last summer are in effect an anomaly. Instead of being an indication of future profitability and expansion, they simply are a reflection of scarcity produced by increased usage, instability from hurricane Katrina and the Middle East, and environmental policy.
In essence, what policy makers should focus on are policies that will allow refining to become a more profitable venture. Profits help direct resources to where they are needed most, and we are in desperate need for refining capacity.
Ologopolistic markets (like fuel markets) are characterized by a non-cooperative Nash Equilibrium for defection. This means that if all of the oil companies are 'price gouging' now then there is a revenue increasing incentive for discounting.
The previous analysis indicates that with price gouging, the high prices at the pump are unsustainable, and cannot be maintained for long.
However, if the high prices we are now experiencing are related to fundamentals, like increased demand from China and India, Middle Eastern instability, reduced refining capacity due to EPA standards, and hurricane setbacks, then it is likely that we will see gas prices remaining near 3.00/gallon and oil at 70.00/barrel.
Of course, much of the 3.00/gallon is still artificially inflated. (the real price of gas since 1950 not adjusting for tax differences across time has ranged 1.90-2.00) While our gas prices are not artifially inflated nearly to the extent as in Europe, we still pay a significant portion of taxes at the pump.
In addition, provisions of the Clean Air Act make it impossible to reduce shortages in one market with surpluses from others. As a result supply fluctuations lead to price spikes.
While technological progress will lead to alternative fuels in the future, a more immediate solution can be found via changes in tax and regulatory policy.
Tuesday, April 11, 2006
Currently there are over 21 countries with major biotech production. For the last 10 years we have seen the percentage of biotech crops planted double each year.
In fact >90% of farmers that plant biotech crops are in developing countries-many of which would be considered at the subsistence level.
Biotechnology is actually a size neutral technological advancement. Unlike advances in mechanization, GPS, or inputs that may require a large scale of production, biotechnology can be adopted by the smallest of producers.
Drought resistance, disease resistance , and insect resistance are all examples of traits that are size neutral. Advancements in genomics, quantitative genetics, and molecular biology will only perpetuate this trend.
Monday, March 27, 2006
Why? First, for scientific accuracy. Second, because aside from being a fad, and aside from those organic patrons genuinely seeking health and well being, there are those cohorts of an organic movement that are motivated by an anti-capitalist and anti-agriculture agenda.
Because modern technology makes agriculture an information driven and capital-intensive industry, because this is made possible by economic growth and capitalism, and because it works so well, the modern farmer makes a difficult mascot for any socialist or interventionist agenda.
These people prefer an agriculture of the past. I’m not talking about the strong work ethic and rural values that they try to romanticize in their cause, I’m talking about mules and pitchforks. For their mascot they want the `family farmer` that milks two cows and grows sweet corn for the local market. And they want the government to subsidize that way of life. They want us to believe that only this type of organic production is healthy and sustainable.
The modern farming operation then becomes a `factory` farm and livestock management is deemed cruelty.
The truth is that this is an anathema to modern agriculture, and the most anti-agricultural stance one could take. This vision promotes the stereotype of an ignorant rural America devoid of education and technology. It then stigmatizes the modern producer that takes advantage of better education (High School FFA or College) and technology like herbicide resistant crops and improved livestock genetics.
While organic foods can offer us a fad choice and possibly a sense of nostalgia, modern agriculture will provide us with food, fiber, medicine, and perhaps energy for years to come.
Thursday, March 23, 2006
According to the USDA, 40% of total agricultural production in 2003 (vs. just 11% in 1969), and 47% of livestock production, was accounted for by contract marketing. For small operations this accounted for 20% of their production and more than 50% of production with regards to larger operations.
Of course this mostly comprises major food staples like livestock, corn, wheat, and soybeans as opposed to produce. More so than farmers, city and local governments have stronger interests in local ‘farm’ produce markets for the sake of local tourism and to promote so called ‘green’, ‘sustainable’, or ‘organic’ agriculture (see also 'Is Organic Better').
The truth is, as agriculture has evolved into a heavily capitalized information driven industry, there are too many other profitable investment opportunities for producers to engage in as opposed to tomatoes and carrots. Investments in RTK (real-time-kinetics) technology or a GPS consulting service can save enough in production and energy costs to pay for itself sometimes within one season -and is a free market solution to environmental pollution (see 'Free Market Agriculture-Green Profits').
Livestock markets have overcome the equivalent to the age-old ‘lemon’ problem by using micro chip inserts. This technology can guarantee the identity, health, and genetics of livestock, allowing producers to receive a premium for better livestock.
It's likely that many of the ‘roadside pickup truck’ marketers are the weekend gardener types. Local governments and fad enthusiasts may be trying to capitalize on the romanciticism of old fashioned agriculture to promote tourism via pork barrel spending. I think this undermines those legitimate producers interested in transitioning from tobacco to produce, and tarnishes the image of the modern producer and the self-reliance that modern technology makes possible.
Friday, March 17, 2006
Many consumers have a negative attitude about Genetically Modified (GM) foods because they think that their perceived bad experiences with them in the past only confirm the bad press that they may have heard.
One example includes GM tomatoes. When tomatoes ripen certain enzymes begin to degrade the fruit’s cell wall (because breakdown of the fruit is necessary for seed dispersal). While this makes ripe tomatoes tender and juicy, it also makes them very susceptible to damage and disease.
There are many ways that producers try to avoid this. With organic produce you can harvest early. Buyers can then ripen them in the window seal. Conventional producers harvest early and then treat their produce with the ripening hormone ethylene. Genetically modified varieties have altered enzyme systems that allow early harvest and delayed ripening.
In every case, the end product is typically a chewy, pale, tasteless tomato. There is no way to distinguish a GM tomato from any other based on taste or appearance. Nor is there any difference in safety or nutritional quality. In fact, GM tomatoes can be produced with fewer herbicides and pesticides than conventional tomatoes ( see also 'Green Profits' and 'Is Organic Better?' ) making them much safer.
Thursday, March 02, 2006
There are two things that I would like to point out regarding this issue.
1) Total spending on agriculture comprises 1% of the federal budget. Of that amount, less than half is allocated to the producer. The bulk of the rest is spent on aid to the poor and school lunch programs.
2) Despite that the funding is a small proportion of total federal spending, there are still market distortions that result from these programs.
One Iowa State University economist has pointed out that up to 1/3 of the price of farmland can be attributed to government payments. In fact many producers have expressed that government programs have increased the price of land and impeded their ability to expand their operation and remain competitive.
It seems that while many producers favor maintaining a safety net, they are also utilizing technology, crop insurance, and marketing tools to manage much of the risk characteristic to their market. In addition since agricultural production is very much an export-oriented enterprise, free trade is essential to opening up markets for food and fiber.
With the amount of lobbying and rent seeking that goes on across the board in all industries, it is not accurate to characterize the agricultural industry as having a prominent interventionist overtone. It turns out that modern agriculture is very much a free market friendly industry.
Friday, February 17, 2006
Is this realistic? Lets look at the facts.
1) We currently produce 40 billion gallons ethanol (corn) out of a 146 billion gallon gasoline market, which is approximately 3%.
2) After this year estimates indicate that biodiesel production will be >100 million gallons out of a 55 billion gallon market for diesel fuel.
3) Current estimates based on current technology indicate that it would require 40% of cropland to replace just 10% of gasoline consumption.
We may not be able to replace 75% of our gasoline and diesel consumption with biofuels, at best we may only be able to pick up the slack in conjunction with improved fuel efficiency, hybrid fuel technology, and increased domestic production. It is estimated by the department of energy that we could replace 30% of gasoline consumption by the year 2030 with biofuels.
With technological change over the last 50 years, we produce twice the output per unit of energy than we did 50 years go. Even modest increases in biofuel production will help alleviate the volatility of our balkanized gasoline markets dictated by EPA rules. Biofuels are more than just a PR opportunity for modern agriculture; they are another example of how technological change will once again help markets triumph over 'limits to growth' pessimists.
Thursday, February 02, 2006
Basic economic theory and empirical evidence tells us that increases in the minimum wage leads to increased unemployment (via decreased hours,decreased hiring,consolidation of duties) especially among the low skilled. It also increases the potential of discrimination.
By cutting off the potential for low skilled workers to develop human capital ( ability to follow directions, be on time, communicate with others etc.) these policies condemn many to a life of poverty. In addition they give larger corporations like Wal-Mart a competitive advantage over small proprietors.
The assumption that a third party could arbitrarily determine the value of one's labor is not only arrogant but logically confusing. It makes an assumption of a 'just price' for labor.
In the case of goods, when you pay $15 for a CD you do so because you value the satisfaction that it brings to be worth $15 or more . When the retailer offers to sell you the CD for $15 he believes that the CD is worth at most $15, but probably much less. When two people have completely different valuations for a good, there cannot be ‘one’ price that is just. Increase the exchange to include millions of others, and the problem becomes much more complicated. It therefore seems an impossible feat for a third party to be able to calculate a price that even closely approximates a ‘just price.’
This same logic also applies to the price of labor.
Tuesday, January 31, 2006
Organic cultural practices require tillage and the use of manures, which both contribute to erosion and pollution. Organic production also can have yields as low as 10-40% less than conventional methods. Thus feeding the world via organic methods would require more land i.e. destruction of habitat and biodiversity.
Tuesday, January 24, 2006
Health and Safety
Many people fear synthetic pesticides and herbicides. The media in its use of terms like "factory farming" and "frankenfoods" has helped create the perception that GM foods are unsafe as well. Since organic foods avoid chemicals and 'genetic engineering' people naturally think that they are safer. Since organic products are produced naturally on 'small' family or cooperative farms people feel that these foods are better because quality is lost with mass produced foods.
2) Even organic and 'natural' foods are not 'natural'. They have been developed by plant breeding that involves bringing together thousands of unknown gene combinations with unknown functions. Seedless grapes and watermelons result exactly because these combinations have adverse effects on the plant embryo(seed).
3) Without herbicides, you get weeds that can host pests. In absence of pesticides, pests feed on plants, which can lead to disease and mycotoxins that are known carcinogens.
4) Transgenic crops will actually enable us to improve the nutritional quality of our food- on the market now we have 'Vestive' soybeans that have improved fats that obviate hydrogenation and unhealthy trans-fats.
Next I will discuss myths regarding environmental pollution and organic vs. conventional foods.