Food Policy, Economists, and the Hazards of Assuming a Can Opener

A physicist, a chemist, and an economist are stranded on a desert island with nothing to eat when a can of soup washes to shore. The physicist says: “Let’s smash the can open with a rock.” The chemist says: “Let’s build a fire and heat the can first.” The economist says: “Let’s assume we have a can-opener.”

The attacks coming from economists against the local and sustainable food movement sound a lot like this joke: The arguments are based in flawed assumptions, obfuscated by fancy charts, big words, and complex calculations. 

Consider this most recent rant, “The Inefficiency of Local Food,” on the Freakonomics blog by economist Steven Sexton, who challenges the claim that “relocalized” food systems can be as efficient as today’s modern farming. He writes, “Today’s high crop yields and low costs reflect gains from specialization and trade, as well as scale and scope economies.”

Let’s start with Sexton’s assertion that industrial agriculture’s high yields can be attributed in part to specialization and trade—gains presumably lost when we “locavores” start frequenting farmers’ market. He writes, “The case for specialization is perhaps nowhere stronger than in agriculture, where the costs of production depend on natural resource endowments, such as temperature, rainfall, and sunlight, as well as soil quality, pest infestations, and land costs.”

When I was in graduate school, our economics textbooks spun this old yarn, too. It’s based in the theory of “comparative advantage,” dating back to classical economist David Ricardo’s writings in the 19th century. Specialization, argued Ricardo, makes sense because regions and countries should grow what best suits their climate and soils and then trade for what grows best elsewhere.

But when Ricardo extolled the benefits of comparative advantage, “capital” couldn’t move. Now that corporations can, and do, this theory no longer holds. In fact, regional or national agricultural comparative advantage often reflects nothing “natural” at all, but rather the extreme imbalances in power in our food system that enable those at the pinnacle to more heartlessly exploit the land and the workers lacking power.

To choose but one example: Ricardo’s theory doesn’t explain why North Carolina jumped from a bit player in the hog industry to number two, after Iowa, just in the past few decades. The key was the state’s concessions that lured the hog confinement industry, including its weak environmental and labor laws.

Of course it doesn’t make sense to try to grow mangoes on rooftop farms in Manhattan, but contrary to what Sexton implies, that’s not what regional food advocates suggest. Indeed, one of advocates’ core tenets is that the healthiest diet, for eaters and the planet, prioritizes choosing foods that grow well where we are, when they are in-season or when they can be stored, and considers those mangoes a special treat.

Sexton’s other hit on the efficiency of sustainable farming is that its yields don’t measure up. As a result, he says, shifting to a regional food system would require “more inputs to grow a given quantity of food, including more land and more chemicals.” But his calculations are based on assuming we’re not reconsidering what we grow or how we grow it.

But locavores and regional food advocates aren’t suggesting we try to plant Iowa-like monoculture corn farms in New York’s Hudson Valley; we’re arguing we need to radically rethink not only where we source our food, but what we plant and what methods we use.

Most American industrial farm acreage, for example, is devoted not to growing food for people to eat directly, but to grow commodity crops like corn and soybeans that are mainly used as inputs—for livestock production, ethanol, and industrial products. In addition, the American industrial food system wastes as much as half the food we could all be consuming. This waste embedded in the industrial model and its squandering of vital farmland for non-food production is enough to shake your head at the economist who praises its alleged efficiency—or suggests that by shifting away from this model we are putting the planet at a greater risk for hunger.

Sexton misses two other important points. For one, those industrial yield figures start looking a lot less impressive when you consider the cost by which we’ve achieved them—and especially when you learn that those costs are ones we need not pay. High yields from industrial agriculture rely entirely on external inputs—most of them in the finite, nonrenewable, we’re-not-gonna-have-them-in-fifty-years category.

Consider, for example, that in the Midwest we’re outstripping the nation’s largest source of groundwater faster than we’re replenishing it. A recent peer-reviewed study published by the National Academies Press concluded that if we don’t shift away from this industrial model, the Ogallala aquifer—which one-quarter of the farmers growing corn, soy, and cotton and 40 percent of those raising feedlot beef rely on for water—will be completely drawn down in a few decades.

Using new techniques to track soil erosion, scientists at the Environmental Working Group  found that vast swaths of Iowa and other Corn Belt states were losing their rich topsoil soil at rates many times faster than official estimates had assumed. Industrial monoculture methods leave the soil bare for most of the year and relying on external inputs for fertility defeats the build up of healthy soil—both practices make land vulnerable to erosion.

By definition, industrial agriculture relies on applying manmade fertilizer year-upon-year. But relying on external inputs for farming’s key macronutrients—nitrogen, potash, phosphorus—comes at big costs. While nitrogen is abundant in our atmosphere, to “bind” it into a usable form requires an enormous amount of energy–often natural gas. In China, 70 percent of nitrogen fertilizer production is powered by coal-fired plants.

The widespread use of phosphorus in industrial agriculture–by 2008 industrial agriculture was applying 17 million metric tons annually–has led to what some experts call “the gravest natural resource shortage you’ve never heard of.” Relatively rare on the Earth’s crust, phosphorus is mined from ancient marine deposits, but it’s running out. Some say that within 30 to 40 years we may have none left. Plus, for every ton of phosphorus we mine, we produce five tons of radioactive waste. Today, the U.S. is home to more than one billion tons of this waste stored in 70 towers, ranging from just a few acres wide to some the size of 720 football fields.  In addition, we’re using more potent pesticides than ever, yet despite massive chemical pesticide use, we still face significant crop loss due to pests.

The second point Sexton misses is that strong yields don’t necessarily require chemical inputs and egregious water overuse. Truly sustainable growers know how to grow abundant food without all these external inputs: They recycle nutrients, employ natural methods to repel pests and conquer weeds, and tap ecological sources for fertility, like nitrogen-fixing cover crops. And guess what? Yields hold. In one crop-by-crop analysis over three decades, organic corn yields held steady per acre with conventional ones. Even more notably, during drought years the organic fields, with quality soil structure that retain water better, had 31 percent higher corn yields than conventional ones.

Studies are coming in from around the world—from the UK government to the United Nations to the OECD—that innovative sustainable farming techniques can match industrial agriculture in yields. And, when and if yields are lower, the lower output is more than made up for in reduced costs (both financial and societal) of inputs, better nutritional quality, improved soil and biodiversity, and more. In one of the largest studies of its kind, researchers at the University of Essex analyzed 286 farming projects in 57 countries, including 12.6 million farmers transitioning towards agricultural sustainability, and found a yield increase of 79 percent across a wide variety of crop types. Take a look at just those projects in East Africa and the increase in yields jumped 116 percent when sustainable farming approaches were introduced.

But, despite the evidence, Sexton and other economists with their collective blinders on still argue that the only way to feed the planet is with the industrial agriculture methods they endorse. Sure, that works. Just assume unlimited water, fossil fuels, petrochemicals, potash, phosphorus, topsoil, land, stable climate, and endless storage for radioactive waste. Just assume farmers can keep paying for these expensive inputs. And, assume all of us can afford the environmental and health consequences.

You’ll also need to ignore the plain fact that industrial agriculture has already proven unable to feed the world: Globally, we’re now producing over 20 percent more food per person than the late 1960s, but there are more hungry people—now almost a billion. Fixated narrowly on production, industrial agricultural so concentrates power that people go hungry no matter how much we grow.

So, ignore all that; assume the can opener.

If, however, you’d rather join me in the real world—where the occasional economist resides—and where natural resources are preciously limited and where farmers prefer not to pay dearly for inputs or be poisoned by pesticides, you’ll see that the most effective way to feed the world is to embrace a food system based in ecological systems and common sense.