When I make the case for greater local self-reliance in agriculture I quite often come across the counter-argument that Britain hasn’t been self-sufficient in food since the early 19th century. This is true, but what’s not so often noted is that we’re now not self-sufficient in different kinds of foods to those we weren’t self-sufficient in 200-odd years ago. Back then we were self-sufficient in most things except for staple grains, whereas now we’re mostly self-sufficient in staple grains while we’re not self-sufficient in most other things, our greatest food-trade deficit being fresh fruit and vegetables.
The reasons for this switch aren’t hard to find. As a result of crop-breeding, mechanisation, the development of artificial fertilisers and other agro-chemicals, along with the EU’s productivist aims and subsidy regimens, cereal productivity nationally, and per hectare or per hour of human labour, is now much greater than it was in the early 1800s. So despite a six-fold population increase since then, we’ve become pretty much self-reliant in cereal grains – though it’s a fragile self-reliance, based to a considerable degree on imported fossil fuels. But the cost of labour and the opportunity-cost of agricultural land is now also much greater, while the relative cost of energy is much lower – all of which mean it’s cheaper to import bulky, labour-intensive products like fruit and vegetables than to produce them domestically as we did a couple of centuries ago.
Wait, scroll back. Did somebody mention the EU? Britain voted to leave that creaking old juggernaut years ago and then struck out boldly on its own, right? The answer to that is yes and no, my friend, yes and no. Yes, we did narrowly vote to leave the EU more than two years ago, but no we haven’t left yet. Instead, we’ve had two years of epic fudging, as the government has tried and largely failed to work out how to leave the EU without tanking the economy, while simultaneously dealing with vast amounts of other fallout, such as the Irish border question. Perhaps I’ll write another post soon that runs the rule over this monumental waste of political energy, but here I’d like to focus on just one aspect of the aforementioned fallout, namely post-Brexit agricultural policy.
The government’s consultation paper Health and Harmony: the Future for Food, Farming and the Environment in a Green Brexit set out its post CAP policy thinking, receiving a response from me and, apparently, about 43,999 other people and organisations. I don’t think I was the only one to notice that there was precious little about food or farming in the paper. The government seems to be planning some kind of environmental payments scheme to farmers on a ‘public money for public goods’ basis, but the notorious single farm payment subsidy regimen is soon to be history, with nothing to replace it. This was predicted long ago on this website – not that it was a hard prediction to make.
Well, the SFP was a bad scheme, and it won’t be mourned by many. Though much as folks like to bang on about the way it enriched people who didn’t need enriching and turned farmers into subsidy-junkies, the truth is the real junkies were retailers and consumers grown reliant on rock-bottom farm-gate prices. I won’t further plumb that particular line here, but it’s worth noting the implications of the SFP’s demise. There’s to be no emphasis on national food production or security, instead just a thoroughly neoliberal commitment to making British agriculture globally competitive. Which it probably won’t be across almost all dimensions of food production, with the possible exceptions of things like whisky and smoked salmon. My guess is that in the short-term we’ll see farmers getting out of farming and becoming landscape managers, while retailers and consumers continue getting their cheap food fix by importing more from abroad, regardless of the longer-term consequences – something like the ‘bad rewilding’ scenario I outlined some time ago. Farms will prioritise chasing money for wildlife management and visitor attractions, while we export the responsibility for producing our food to other countries willing to sell on global markets (and possibly less anxious to protect what remains of their own wildlife).
Nothing wrong with all that, according to mainstream economic theory. If each country focuses on what it’s best at producing and imports what other countries are best at producing, then everyone gains – this was all explained long ago by David Ricardo in the theory of ‘comparative advantage’ set out in his Principles of Political Economy and Taxation (1817).
Comparative advantage is still routinely invoked as a justification for free trade today, so it remains sadly necessary to explain why it’s a poor foundation for contemporary economies. If investors who are unable to freely put up their capital outside their own country – which was generally the case when Ricardo was writing – wanted to obtain the best possible financial returns, then it made sense for them to invest in their local or national industries with the greatest comparative advantage. But since Ricardo’s day, the entire drift of global financial policy has been to remove the trade barriers that pushed investors to seek comparative advantage, and also to virtualise the economy away from the production of physical things and towards the increase of money itself. So while an English capital-holder today may be better advised to invest in cloth than wine (Ricardo’s original examples) if they want a high return on investment they’re almost certainly even better advised to invest in derivatives on Wall Street. This replacement of comparative advantage by absolute advantage fundamentally changes the economic game in ways that quaint Ricardian theories of international trade are powerless to model.
Meanwhile, national and local governments have numerous responsibilities. Trying to maximise fiscal flows and foreign exchange earnings are certainly among them, but there are many others – the health and wellbeing of the populace, the resilience of infrastructures (including soil health and food security) and so on. Global policymakers nowadays seem to be gripped by a huge Hayekian delusion that all of these things are best secured by hawking them on global commodity markets. Even so, most wealthy countries take steps to protect their agricultures and ensure that their farmland remains productively farmed. You can certainly criticise the way they go about it – as in the EU’s common agricultural policy – on numerous grounds, but the basic motivation behind it seems sound. It’s unusual, and I think ill-advised, for a country to cast out its agriculture as Health and Harmony does in favour of the religious mantra that ‘the market will provide’.
Eighteen months ago I was pilloried on here by a couple of commenters for supporting continued British membership of the EU on the grounds that the latter is committed to neoliberalism. But it seemed obvious then, and it seems even more obvious now, that aside from a few misty-eyed nationalists the main impetus for Brexit within the Conservative Party came from people dissatisfied with the EU because it wasn’t neoliberal enough. The Health and Harmony paper seems confirmatory of this point. A case could have been made for a ‘progressive’ Brexit, but it would be stretching a point to say that that case has even been a marginal part of Brexit politics. In this sense, though I don’t like to use the term, people who supported Brexit for its progressive possibilities strike me as essentially useful idiots for neoliberalism. Though it’s possible, if fortune smiles on them, that they may yet have the last laugh.
In the short term, though, Britain is putting itself at a comparative disadvantage in pursuit of ‘competitiveness’ in the global agrarian economy. It’s worth bearing in mind that agriculture currently contributes less than 1% of Britain’s gross value added economic output, and under any realistic medium-term economic scenario it’s hard to see that increasing in any major way. But Britain could more or less feed itself from its existing agriculture if the government chose to make that a priority. To me, that seems a much wiser option than trying to wring another few million quid from a more ‘competitive’ agriculture.
Meanwhile, another aspect of Ricardo’s economics is looming ever larger. Ricardo supported international free trade because he perceived that in a protected capitalist market landowners would be able to extract economic rent – an excess return over production costs – as a result of increasing food demand. Essentially, he construed a scenario in which labourers did honest work to earn their wage and capitalists did honest work to earn their profit, while landlords pocketed an increasing share of the economic surplus thus generated without lifting a finger.
This dynamic of Ricardian rent has largely been in abeyance for many years in the rich countries. Food prices have been low and rural landownership has rarely been a royal road to wealth. But as industry and economic growth stalls and inequalities widen, the prospect of the economy falling into the grip of landlordism grows. If we extend the logic beyond agricultural land per se, it’s already happened. It’s already happened from a poor country perspective in terms of the extraction of Ricardian rent by rich countries in controlling access to the global economy (this is one reason to welcome exit from the protectionism of EU agricultural policy – but Britain unilaterally falling on its sword in this way probably won’t benefit poor people globally a great deal). And it’s already happened from a rich country perspective in the substantial exit of businesses from matters of production in favour of battling to control the means of circulation – intellectual property rights, branding and so forth. The emergence of a rentier capitalism which has no interest in putting capital to work in service of material improvement (always a minor theme at best in earlier capitalist iterations in any case) has a thoroughly Ricardian resonance.
The way I see this panning out is a period of tricky trade wheeler-dealing that won’t be more economically beneficial to Britain than EU membership was, but may inaugurate a brief honeymoon of cheap, low-quality imported food and possibly improved wildlife habitats at home (we’ll conveniently ignore the consequences for ghost acres abroad). Then as climate change begins to bite in the global breadbasket countries and calculated self-interest looms larger in the global political economy, I think we’ll be in for a major food crisis where it’ll suddenly seem like a good idea for the government to be supporting the local production of food, and where large landowners in possession of lightly-farmed estates may start to feel some class-aligned political heat.
At that point, the government will start casting desperately around for solutions to the self-inflicted problem of its Ricardian nightmare. Luckily, Small Farm Future will be here for it, shining a guiding light that will help it overcome the Ricardian perils of our age with this simple two point plan:
- A new protectionist economics, focused around local production for local use. This protectionism won’t be of the tit-for-tat, ‘my country first’ kind being reinvigorated by idiotic politicians like Donald Trump. It will take the form of an internationally agreed, convivial kind of protectionism in which collective strength is gained from individual difference.
- A new anti-landlordism economics. But not in the traditional socialist or capitalist manner of alienating people from the fruits of their own work on the land, because the benefits of this ‘globalising’ move will no longer be paying out. In this situation, the most obvious form of anti-landlordism is of the if-you-can’t-beat-‘em-join-‘em variety, in which more or less everyone becomes their own landlord.
The result of this protectionist, anti-landlord economics would look a lot like the small farm future I’ve long promulgated on this blog. What a funny coincidence. Undoubtedly, figuring out how to deliver this future from the unpromising present is a major conundrum. Happily, here at Small Farm Future we have all the answers – and we’ll start revealing them soon. But not just yet. First I have to go and pinch out my tomatoes.