Sustainable Farming

    Ken Palmerton, James Gibb Stuart and Alistair McConnachie discuss.

    On 18 April 2001, Money Reformer Ken Palmerton visited the offices of Prosperity. We took the opportunity to discuss the present Foot and Mouth crisis and the possible Money Reform lessons we could learn.

    ALISTAIR: The justification for the slaughter policy is to achieve "disease free" status in order to re-open the export markets. In other words, we have an issue here which is a perfect example of our dependence on globalisation.

    JAMES: I’m reminded of my home village. Not so long ago, the local farmer raised the beasts in the field next to the village. When the time came, they were walked down the street to the local abattoir, and they appeared in the village butcher’s shop the next day. Local production for local consumption. What happens now? They’re transported massive distances by truck to be slaughtered, packaged, the meat shipped abroad — and probably shipped back again! — to appear in a supermarket, at the other end of the country.

    KEN: We’ve got to get to the farmers and persuade them that they’ve been conned. They’ve hooked their industry to the star of globalisation, and it’s going to sink them.

    ALISTAIR: Yes, there’s an obsession with the global market, most evident from the leaders of the industry.

    KEN: They’ve stopped looking at their local markets. I’m sure the farmers themselves know in their heart of hearts that what they’re doing is not sustainable, but the people who drive this industry — finance, supermarkets and agribusiness — have other concerns. Meanwhile the farmer sees his life’s work disappear, quite literally, in a puff of smoke!

    ALISTAIR: To a very large extent the farmers are the victims of the system. They’ve had to adjust their farming methods just to survive within the present system. It’s the economics of survival. If there was a sustainable alternative that was politically possible, I think most would gladly have it.

    KEN: The farmers are not taught why there is this drive for exports. This drive is because we can’t make our own home market self-sustaining, because there is a "deficiency of effective demand" as Keynes said. This is because there is a "flaw in the system" as the Social Crediters used to say.

    Productive industry does not put into circulation enough money to buy its own production. This is the C. H. Douglas "A+B Theorem" [See The Monopoly of Credit]. If we didn’t do anything about it, civilisation would come crashing down.

    But we do something about it — we borrow. For example, all the shops around here will give you credit. They will supply the goods now, but you pay for it with future earnings. In my view, that is the proof that there is a flaw in the system. Albeit, purely an accounting flaw.

    ALISTAIR: And the way around it is … ?

    KEN: I would suggest that only the State, or somebody given that responsibility by the State, can do the following — calculate how much money is required to make that system of production function and put that money into circulation.

    The best way, in my view, is straight into the pockets of the consumer, via a basic income for example. Our ability to produce is not in doubt, but our ability to consume is in doubt.

    So we do crazy things, like trying to sell outside our economy what can’t be bought inside. And what do we want in exchange — money! Every country can’t have a positive balance of trade! The idea that every country in the world can benefit from this system is mathematically impossible.

    Look what we are doing. We are sacrificing a whole vital major industry on that altar of globalisation. That’s the poor, bloody, farmers for you. Well, maybe our job is to help them to realise that they are being led by the nose, along a path which is not sustainable.

    Take the IMF model. It’s a simple one. Borrow, invest, produce, pay your debt. There isn’t a country in the world where it has worked. Not one! And they’ve been doing it for 50 years. I would have thought that is long enough for an experiment. Come on, let’s have a few different experiments.

    What is the government offering farmers? More loans! Come on! They are up to their eyeballs in debt already. Why do you think the farmers in Alberta in 1935 voted in block for the Money Reformers who would deal with their debt?

    JAMES: One of the cruellest things they did in the last 100 years was to destroy the Land Banks. The Land Banks provided finance for farmers. The critical point can be illustrated as follows. I was in industry. We could bring material into our workshop at 8 o’ clock in the morning. We could process it and despatch it by 4 o’ clock in the afternoon, and invoice it the next day.

    The farmer puts seed in the ground and it is 9 months before he gets a product. He raises beef stock and it’s 2 years before the calves are fat enough to provide an income. The point is you need a long term finance facility if you’re a farmer. The farmer has been competing in the same market as the industrialist and he can’t do that.

    KEN: That’s right. The farmer can’t influence when the sun is going to come out, when it is going to stop raining, or when some disease is going to hit.

    ALISTAIR: I think the justification for the slaughter policy, that is, to achieve "disease free" status in order to re-open the export markets, falls down on both counts.

    Firstly, it doesn’t make economic sense to base policy entirely upon achieving disease-free status for the export markets, because disease-free status is a highly vulnerable condition, and can be lost at any time.

    Secondly, there’s no telling when the export markets may fall or disappear. Are we really meant to believe that all the Europeans are going to rush out and buy British meat again? After all this, I think it’s likely that nobody abroad will want to buy our meat, disease-free or not.

    Therefore, we’re going to need to look at new ways of exploiting domestic demand. An alternative to relying upon the export trade is to develop new home grown markets right here. A shift from globalisation to localisation is needed.

    KEN: I think so. It may well be that farmers are going to have to go back to doing things which they may think are old fashioned.

    ALISTAIR: We need alternative polices which will enable us to maintain a successful farming industry, whether or not we have disease-free status.

    We import more beef, lamb and pork than we export. This means there is an untapped home market for national produce. However, many British farmers remain dependent on export markets because supermarkets buy cheaper meat from countries with low wages, and low health and environmental standards.

    Farmers Markets, however, have been growing successfully throughout Britain. These Markets are able to provide quality food below supermarket prices. These Markets also boost the local rural and tourist industries. We should have one in every town in Britain.

    KEN: We’ve got to do some re-thinking and it may well be that this foot and mouth is sufficiently serious for some farmers, and the policy makers, to also do some rethinking.

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