At 2:14 PM +0100 4/26/01, Ken Brown wrote:
>
>Agricultural land in the UK is, in effect "zoned", You can't use it for
>any other purpose without permission from local government. So a lot of
>land that might be more economically productive turned to other uses
>remains in the hands of farmers. This has undesired side effect. The
>price of land is lower than it would be if there was a free market but
>higher than would be expected from the demand generated by farming,
>because some land is sometimes released for building, so the price of
>agricultural land is slightly inflated. Undesired consequence -
>agriculture can't support the mortgage on farmland, so small producers
>go out of business, and land is in the hands of property companies and
>insurance companies who are in effect betting on the chances of it being
>released for development.
Which likely makes many of these distantly-owned tenant farms less
likely to invest in the future...not much point in setting up
decontamination systems, vaccinations, etc. if it is expected that
the land will be released for development.
Also, I suspect these "corporate farming" methods had a lot to do
with the practice of liquidating some herds, grinding them up, and
feeding them to _other_ herds. ("We'll just move some of the protein
inventory from Location 537A over to Location 231C, to take advantage
of certain tax benefits.")
(Sort of like a big protein refinery, with feedstocks shuttled around
the refinery, er, the farms.)
One of the big downsides of this decision to grind up some herds and
feed them to other herds is BSE, aka "mad cow disease." While BSE is
not F&M, it's probably no surprise that the U.K. farms are now having
to deal with both problems.
I'm not against corporate farming per se...let the best use of the
land be made, free from interference. However, as Ken notes, the many
distortions in markets makes certain forms of distant-ownership more
likely, and may have a lot to do with crowded grazing lands,
distorted meat prices, lack of investment in protective measures, and
the appearance of both BSE and F&M.
The decision to "burn the herds," using old tires and
pressure-treated railroad ties, in a way that no _private party_
would ever be allowed to do, is also symptomatic of too much leeway
for government, too much distorting of markets.
>
>Government subsidies and artificially high prices encourage farmers to
>overstock and overproduce, leading to food surpluses, quotas (and quota
>trading).
And probably the overcrowding of some sites that facilitates the
spread of F&M, along with the "liquidate one herd and feed it to the
other" practice that facilitates the spread of BSE.
>
>If there were a free market in farming in the UK there would be less
>livestock, and it would be more diverse. So it would be worth more, and
>farmers would be more inclined to vaccinate to preserve valuable
>breeding stock.
Exactly. Bigness does indeed sometimes cause big problems. Bigness
may be more efficient, when it's running smoothly, but the loss of
diversity (the monoculture problem) and the increased feedback loop
length (managers in London unaware of issues in the countryside) can
cause escalation of problems.
By the way, the loss of many small farms to corporate farms is due in
many cases to high inheritance taxes. The children of farmers cannot
pay the taxes, which can be as high as 50% of the estate's value, in
the U.S.
(Remember that the owner of some assets, be it stocks or a farm, has
typically paid income tax on his income to purchase the asset in the
first place, has paid taxes on dividends or income from the asset,
and so an "estate tax" is at least the second major tax on the asset
and may very well be the third such major tax on the asset. This is
the rationale for eliminating estate taxes altogether.)
--Tim May
--
Timothy C. May [EMAIL PROTECTED] Corralitos, California
Political: Co-founder Cypherpunks/crypto anarchy/Cyphernomicon
Technical: physics/soft errors/Smalltalk/Squeak/agents/games/Go
Personal: b.1951/UCSB/Intel '74-'86/retired/investor/motorcycles/guns
