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Source link: http://archive.mises.org/8698/berry-and-the-crunchy-cons/

Berry and the Crunchy Cons

October 5, 2008 by

I was asked to write an article on the Crunchy Cons for Taki. It is here. It seems to have upset many commentators there. Meanwhile, this piece seems to have drawn some heat at Chronicles, which has a thread on the topic.

{ 10 comments }

JP October 5, 2008 at 10:17 am

Reading those clueless statists rant on about the evils of the free market on the takimag site makes me want to post comments in your defense! Unfortunately, it won’t allow me to comment…

Inquisitor October 5, 2008 at 12:06 pm

Indeed, all I saw was a bunch of hicks jabbering on about “Permanent” things and how the market is destructive of them, how it’s utopian &c. This from individuals whose knowledge of economics is pitiful at best, embarassing at worst.

Francisco Torres October 5, 2008 at 1:49 pm

Yes, criticisms to the article were wielded by either romantics or nostalgics. How pathetic.

Francisco Torres October 5, 2008 at 2:41 pm

Yes, criticisms to the article were wielded by either romantics or nostalgics. How pathetic.

jon October 5, 2008 at 3:09 pm

i apologize, i could not finish reading your taki article. dreher’s “conservativism” sounds revolting. i guess this is the end result of yuri bezmenov’s description of “ideological warfare.”

scineram October 5, 2008 at 5:51 pm

One of them asked are libertarians the enemy? Yes. We are enemies.

Kevin Carson October 6, 2008 at 3:52 am

My comment at Chronicles:

I agree with Gordon that Dreher and Berry display a regrettable ignorance of economics. But the root of that failing is their willingness is to take seriously the very people who toss around “free market” as a god-term: neoliberal politicians and spokesmen for big business. Like Thomas Frank, Dreher and Berry take at face value the corporate “free market” pretensions, instead of seeing their corporatism for the outrage to genuine free market values that it actually is. Were they better informed economically, they would realize that genuine free markets are the worst enemy of corporate agribusiness, and that big business’s misappropriation of the language and symbolism of the “free market” is as illegitimate as Stalin’s misappropriation of the language and symbolism of the 19th century socialist and workers’ movements. The American corporate economy has about as much to do with “free markets” as Stalin’s Russia had to do with anarcho-syndicalism.

Snippets from Gordon and my responses follow below. The lesson is that, if Dreher and Berry are economically illiterate, then Gordon is equally liable to being considered illiterate on the relevant facts of history and politics–the content to which free market principles must be applied. He is, in fact, using “free market” catchphrases to defend the present wealth and power of corporate agribusiness, with no apparent knowledge of the actual role of the state in creating the present balance of power between corporate agribusiness and small-scale farming.

GORDON: “No one, after all, forces those with Dreher’s preferences to purchase food he does not like: why should he be allowed a similar privilege over others?”

“Farmers are not being forced to leave agriculture at gunpoint.”

CARSON: As Lionel Hutz might say, this is the best kind of right: technically right. But it’s quite disingenuous. The consumer may not be compelled to buy any specific type of produce. But the competitive advantage between small-scale farming and corporate factory farming is most definitely shifted, at gunpoint, by the state. The things available for me to purchase, and their relative prices, are very much a matter decided at gunpoint by the state. If the Interstate highways were funded by weight-distance fees on heavy trucks proportionate to the actual roadbed damage they caused, and if giant plantation farms in California weren’t provided with subsidized irrigation water from the state’s dams, people would be buying a lot more of their produce from small farmers in their own communities. The government’s subsidies go almost entirely to the largest farms, and almost entirely to growers cereal grains. And let’s not even get into the effects of gov’t-mandated RFID chips for livestock, mandated pasteurization of dairy products, and the like, on minimum firm size. Not to mention state subsidies to biotech R&D, the role of patents in promoting GM crops, and the role of food libel laws and FDA labelling restrictions on protecting the marketers of same from a free market in information.

GORDON: “If people need to cooperate in this way in order to survive, how can their activities be coordinated? The price system of the free market offers the only satisfactory answer.”

“[Farmers] have chosen to grow crops for a market, or to seek employment with other market-seeking farmers. If they cannot make it in this activity, this means that consumers prefer to spend their money on other things.”

“Berry could have discovered these elementary facts had he read the relevant works of Mises and Hayek, but he shows not the slightest acquaintance with them, or for that matter with the writings of any other economist.”

CARSON: Reading this, you’d get the idea the present system of domination by corporate agribusiness was actually a free market, or a fair approximation of one. In fact, it is a poster child for state capitalism. Is Gordon defending the principles of the free market as such–which I fully agree with–or is he defending corporate agribusiness and factory farming with the misappropriated language of the free market?

GORDON: “Civilization rests on the widespread division of labor: not even Berry imagines that everyone could live in the small self-subsistent agricultural communities he thinks ideal.”

Actually, division of labor is promoted under the present state capitalist system considerably beyond the levels that would prevail in a genuinely free market. As Adam Smith observed, the extent of division of labor is limited by the size of the market. Both market areas and dominant firm size have been grossly expanded by government-subsidized, centralized infrastructure for long-distance transportation: the land-grant railroads, the various national highway systems culminating in the Interstate, the civil aviation infrastructure (which was built pretty much from scratch with taxpayer money), and the jumbo jet industry (which was able to operate profitably only because government heavy bomber contracts enabled the aircraft industry to use the expensive dies to full capacity). Excessive firm size and division of labor are also promoted by cartelizing activites of the state like “intellectual property” laws, and tax policies that promote capital- and tech-intensive forms of production.

The productivity benefits of division of labor and economy of scale are real, but they level off pretty quickly compared to the actual size of existing firms.

Gordon also hints, in the quote above, at the standard talking point of the USDA-agribusiness complex, that without chemical agribusiness “the world would starve.” This poison meme is trotted out by those, including Norman Borlaug, who are utterly ignorant as to the actual methods used in modern organic farming. Small-scale, soil-intensive farming is in fact *more* productive per acre than mechanized agribusiness.

In my opinion, in a free market the economy would look a lot less like something out of Alfred Chandler, and a lot more like something out of Ralph Borsodi or Lewis Mumford.

fundamentalist October 6, 2008 at 9:11 am

While an excellent review, I think Mr. Gordon misses the point of the crunchy con crusade. It’s not about thinking. It’s all about feeling. Guys like Dreher don’t offer logic for their positions. Most of them are post-modernists who don’t believe in logic or truth. Like Marx, they believe such things are tools the powerful use to stay in power. Feelings are the only truth. That’s why their writings are mostly anecdotes about someone being happier because they became a crunch con. Post-modernists distrust statistics, facts and logic. Consensus is more important than facts and you get consensus with gut wrenching stories. It’s the same way you sell soap. Don’t drown the housewife in research. Tell her the soap will help her get the man of her dreams.

On the flip side, Dreher’s tactics work with the crowd he is trying to reach. If libertarians want to reach the same crowd, we’re going to have to learn to tell emotional stories, too.

A sad aspect of Dreher’s crunchy conman is that he thinks it’s new. Of course, most people in the news business think that if something is news to them, it’s news to everyone else. They’re wrong most of the time. The lifestyle that Dreher advocates has been followed by rural people for generations. My family and friends have grown their own food in their backyards for years. And in small towns, almost all business is done with someone you know personally. It’s very common for someone to by a beef from a local farmer and have a local butcher slaughter it for them.

Even more odd is that Dreher identifies corporate control of state regulation with capitalism. He seems to be completely unaware that as far back as Adam Smith capitalists have been trying to break the link between big business and big government by attempting to shrink government, but ignorant writer like him keep thwarting us.

Peter G. Klein October 6, 2008 at 9:31 pm

I submitted a couple of comments to the Chronicles thread but neither has appeared, so I’ll repost them (with light edits) here.

Various claims have been advanced at the Taki and Chonicles sites about state interventions that benefit large agricultural producers at the expense of small farmers. Kevin Carson’s statement, reprinted above, is the best example. But I disagree strongly with these claims. While it is certainly true that the Monsantos, Cargills, and ADMs of the world are extremely powerful, politically, there is little doubt among serious students of agriculture that the net effect of US and European agricultural policy has been to subsidize small producers. The food-processing and retail sectors are increasingly concentrated but the agricultural production sector (i.e., farming) is the least concentrated, least corporatized, most family-firm-oriented of any mature industry in the world. In the US, corporate farms in 1997 held only 1.2% of total farm acreage and generated only 5.6% of total sales receipts. In France, 75% of farms are family owned with no employees. Farms are getting larger, to be sure (US average of 487 acres per farm in 1997, compared with 149 in 1920), but are still remarkably small considering the potential scale and scope economies in food production. Virtually everyone agrees that this is the result of government policies (not only price supports, production controls, and marketing orders but also special protection for cooperatives, subsidized crop insurance and farm credit, and USDA and university agricultural research and extension services) designed to “preserve the family farm.”

My guess is that in a truly free market for food production the number of Wendell Berry-like independent, small farmers would be about the same as the number of independent, small steel producers or auto manufacturers.

Kevin Carson and I have sparred on this question before, and agreed to disagree, so I won’t bore anybody with a long reply directed specifically to Kevin. Briefly, my view is that Kevin does an able job presenting exactly half the story. He lists a number of government policies, both general (e.g., transportation) and specific to agriculture, that benefit large agricultural producers over small ones. Fine. But there is an equally large number — actually, in my judgment, a much larger number — of government policies that benefit small producers over large ones. I listed the most important ones above. The net effect, in the view of most analysts, is to keep farm size much smaller than it would be in the absence of restrictions on either side.

Incidentally, Kevin refers to large growers of cereal grains who benefit from price controls, “giant plantation farms” that benefit from water subsidies, and the like. But even “large” farms are remarkably small, compared to their counterparts in other industries, both at present and over time. There is no General Motors or Exxon or Microsoft of production agriculture. According to the 2002 US Census of Agriculture, there were 2,128,982 farms. The largest size category tracked by the census, farms with 2,000 or more acres, represents less than 4 percent of that total. Farms of 500 acres or less account for 84 percent. Perhaps a 500-acre farm is too large for Wendell Berry’s tastes, but it hardly represents a capitalist agribusiness behemoth.

DMajor March 18, 2010 at 12:24 am

Peter Klein lists- among other equally dubious things– price support and production control as elements of government regulation that benefit small producers over larger ones. However, he neglects to mention that a vast majority of those subsidies go to the larger “corporate” farms. Brian M. Riedl estimates that around 75% of total subisidies goes to the the top 10% of recipients. Critics have tried to contest that estimate, but so far most research is supporting Riedl’s estimate. One of the common estimates is roughly 66% goes to the top 10% of producres. In addition, the USDA acknowledges that the top 1% of beneficiaries receive around 17% of subsidy payments. Talk about market distortions! There is no way these subsidies are supporting the small producer over the larger.

Mr. Klein, if you are going to use something as support evidence when you are engaging in argumentive discourse, at least do some prior checking of facts. If you don’t you lose credibility and, in moreover, somebody can completely blow holes in your argument as I just did.

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