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An economy fit for farming

At the January 2014 Oxford Real Farming Conference we will discuss the kind of economy that’s needed to support Enlightened Agriculture and all that goes with it. Here, Colin Tudge offers preliminary thoughts.

Enlightened Agriculture – the kind that provides everyone with good food without wrecking the rest – can’t work properly, or at all, unless the economy is sympathetic towards it. But the present economy – the “neoliberal”, corporate-dominated global market, geared single-mindedly to the maximization of wealth –  is anything but. So those who seek to practice enlightened agriculture are faced with a whole tier of problems. They have first to survive in the short-term, day-to-day, which means they must do the best they can within an economic (and political) climate that may pay lip service to their endeavours but on the whole is hostile, and assumes, at best, that the alternatives to the status quo must forever be “niche”. So to achieve any kind of security enlightened farmers must with all possible dispatch provide their own economic micro-climate – one that does suit their needs. The long term aspiration is that that the micro-climates will grow and coalesce: first to provide a true alternative to the status quo, so that people in the present system who want to jump ship have an alternative ship to jump to; and then to become the norm.

Defenders of the status quo – the “powers-that-be” — tell us that to attempt such a shift is “unrealistic”. But what they mean by “unrealistic” is that they, the oligarchs who run the present show (corporates, big banks, governments such as Britain’s, with chosen sections of academe) would lose their supremacy if an alternative economy came on board. This, above all, they cannot countenance. They cannot even bring themselves to consider (so all my own discussions so far have suggested) that it’s their own way of doing things that is “unrealistic”: that the neoliberal economy and the high-input industrial agriculture that it serves has exacerbated hugely the world’s worst problems – human hunger, disease, inequality and poverty; mass extinction of our fellow creatures; and the destruction of the Earth itself, including the climate. The education and lifestyle of the powers-that-be, the oligarchs, are such that the abstractions of economic growth, of accountancy and economic theory, are more real to them than the physical realities of humanity and the fabric of the Earth.

In truth, a shift to an agriculture that is truly geared to human needs and to the wellbeing of other creatures, is the only reality that is seriously worth contemplating; and if that needs a radical shift in the economy – as indeed it does – then this, too, is the only reality that people with common sense and common morality need focus upon.

So people who truly care about the future – of humanity, of life on Earth, and of the Earth itself – must begin a global debate on a new kind of economy. First:

Why do we need a new economy?

In a nutshell: Enlightened Agriculture (the kind that feeds people without cruelty and with minimal collateral damage – which indeed seeks synergy with wild nature) must be rooted in agroecology. Agroecology does not seek slavishly to imitate nature (which after all does many things that would not be good for agriculture) but it does seek to imitate those aspects of nature that make it sustainable and resilient to attack and to change, and reasonably (though not maximally) productive.

The essential features are those of diversity – which in farming translates into polyculture, meaning mixed species with genetic heterogeneity within each; synergy – mutually beneficial interactions between the various species; and low-input – which in farming broadly speaking means organic. Each farm is conceived as a mini-ecosystem, and agriculture as a whole as part of the global biosphere. Such farms perforce are complex. So they must be skills-intensive (populated not with slaves, but with skilled farmers). When enterprises are complex and skills-intensive there is usually no great advantage in scale-up. So on the whole (the default position) farms of the kind that can feed us all and go on doing so should be small to medium-sized enterprises – “SMEs”. Agriculture as a whole must be designed to produce enough to feed everybody well. But – like nature – it must recognize that “enough’s enough”. Emphatically, it should not set out to maximize output. The idea that we need to maximize output – 50% more by 2050 to cope with the rising numbers and the apparently insatiable “demand” for more meat, with a slice reserved for biofuel – is a straightforward, commercially inspired untruth.  We already produce 50% more food than we will ever need.

So farms of the present, industrial kind, which are geared to the maximization of wealth and the centralization of power that goes with it, are the complete opposite of what is needed to provide the world’s people with good food. To maximize wealth they do seek to maximize output. They conceive no upper limit – no “enough’s enough” — because profit in large measure is proportional to turnover. They seek to minimize costs by getting rid of as many as possible of the people who actually do the farming. Zero labour is the goal. Instead of the skilled husbandry that makes low-input polyculture possible we now have heavy engineering and industrial chemistry. Husbandry is simplified to monoculture – and often indeed to monocultures of genetic clones. To achieve economies of scale the farming is on the largest possible scale. This – high-tech zero-labour monoculture on the grandest scale – is the neoliberal vision of the future (as sketched out for example in recent speeches by our Minister of State for Universities and Science, David Willets). For some, such agriculture is immensely profitable. The collateral damage (the billion or so who get too little food; the many millions – potentially billions – put out of work; and the environmental damage) is largely left uncosted. That way the books seem to balance very well indeed.

This, in the modern world, is what’s conceived to be reality. “Progress” means industrialization, commodification, and tighter and tighter top-down control; less and less reliance on human skill and judgment, and more and more on technology and algorithms. This approach is already killing large portions of the world and could kill us all if we continue with it. That is why we need the alternative — enlightened agriculture; and whey we need an economy matched to its needs. So:

What kind of economy is good for Enlightened Agriculture?

Modern thinking in high and academic circles can be astonishingly crude. Thus anyone who suggests that there is something wrong with the neoliberal market economy is assumed to be anti-capitalist; and if they are anti-capitalist then they must be anti-freedom – since capitalism is assumed to be based above all on free enterprise, which is seen as the guardian of freedom itself; and anyone anti-freedom is a “commie”, or is perverse, or as George W Bush put the matter in only a slightly different context, is “evil”. Although the powers that be claim above all to be “rational”, rational discussion on this particular issue is well-nigh impossible.

In truth, capitalism is very hard to define and since its ancient and multifarious origins it has taken many different forms. Ruthless, corporate dominated neoliberalism is only one of those forms: and one that many earlier economists, including the late-18th century founders of the modern United States, anticipated with trepidation and made laws to prevent (which were later circumvented). In truth capitalism is not definable, any more than other big concepts such as “science” or “religion” are strictly speaking definable. In all such cases the best we can do is to identify certain features that all the members of the particular category have in common. So what are the common features of capitalism?

At root, we have what might be called “proto-capitalism”; the kind of economy that seems to have arisen naturally in all societies that we know about the world over. Generally there is some sense of private ownership, at least of personal things, like trousers and cooking pots. There is private enterprise: individuals or groups of individuals have a right and are encouraged just to start making things, and selling them, without asking some central power for a by-your-leave. Always there is trade. The archaeological evidence shows us that even the Neanderthals traded, sometimes over very long distances (because some of their tools are made from stone that comes from far away). The traditional idea that trade began exclusively as barter and later gave way to some form of money seems to be unfounded. Some modern anthropologists argue that exchange of tokens was there from earliest times. Sometimes the tokens have real value (cattle or wheat may be used as currency) but often they do not (gold for instance has only limited use). The meta-world of exchange, or goods and services and money, is known collectively as “the market”.

The shift to recognizable capitalism came when people began to acquire more tokens than they needed immediate purposes, and could then exchange the surplus for more goods and services. The money surplus to immediate needs is what’s called capital. Capital – surplus money — could be accumulated by three main means. First, people who were good at particular things – making pots, writing symphonies – could acquire more than they needed immediately just by charging higher prices. Often, though, people have acquired more cash simply by stealing it. Nations have often made a virtue of this and called it “conquest” (though conquest is often presented euphemistically as “protection” or indeed “development”). Or, money can be multiplied by lending it to others and charging interest. The business of lending can in turn be refined in many ways, and grades into various forms of investment. There are other tricks too (like changing one currency for another, and back again) but the main four are earning; theft; loans; and investment.

We can all agree that theft is bad, even though it has virtually been the norm at international level through all of known history. But there need be nothing very much wrong in principle with any of the other core components of capitalism: private ownership; private enterprise; trade; use of money (or something like it); accumulation of capital; lending with interest; investment. To be sure, in the early 18th century Pierre-Joseph Proudhon famously declared that “All property is theft”. But most people would agree that it is at least sensible for people to lay exclusive claim to personal goods, especially the kind that nobody else would want to lay claim to. As for the rest: Trade is obviously vital. Exchange is practiced in some form or other by all living creatures and as many a politician has observed, it can cement human relationships, both personal and international. Currency is certainly useful. It is hard to exchange a bit of a cow for a cooking pot. Capital is natural and necessary too: a piggy bank is not very different conceptually from the stash of acorns that gets the squirrel through the winter. The ancient Jews and Muslims forbad the lending of money with interest, but at least as a pragmatic device it has its advantages. Investment is surely acceptable. People with talent and energy are able to get going on their chosen enterprises if people who may or may not have talent and energy but are nonetheless rich, provide them with the wherewithal to get started. Capitalism all in all, looked at through friendly eyes, emerges as a way to use the fruits of past endeavours to initiate new ones; a means by which all humanity, in principle, can benefit from the past successes of their predecessors.

Put like this, it all seems splendid. Capitalism in general and the market in particular seem to have arisen by natural evolution, and seem able to meet all our needs. Yet the reality seems very different. So:

What has gone wrong?

In the end, the various components of capitalism, and the modern market as a whole, are just conventions and mechanisms; pragmatic devices. They can help us to create a just and benign society but they cannot do the job on their own. Justice and benignity are moral concepts. Societies cannot achieve them unless they take them seriously, and try specifically to bring them about. The vital ingredient that has gone missing from the modern form of capitalism known as neoliberalism is the most vital of all — which is morality. The market itself has become the arbiter of good and bad. What people are prepared to pay for is deemed to be good – at least up to and including what Charlton Heston was wont to call “personal side-arms”. At the World Food Conference in Davos a few years back I even heard human cloning defended on the grounds that there was a market for it. The only guiding moral principle that the out-and-out neoliberals recognize is a very crude form of Darwinism – one that Darwin himself emphatically did not apply to human affairs: that the market, and indeed all human life, should above all be competitive. “Survival of the fittest” (Herbert Spencer’s summary of natural selection) is the rule; Devil take the hindmost. Neoliberals make a virtue of their ruthlessness. The Chicago economist Milton Friedman spelled out the principles of neoliberalism in the late 1960s and it was launched upon the world to become the economic norm around 1980, by Margaret Thatcher and Ronald Reagan. Friedman himself was not a monster. Far from it, apparently. But, unleashed into the world and given real power, his brainchild has become monstrous.

Oddly, the lack of any imposed morality in the neoliberal market is taken as a virtue. The neoliberals find justification in Adam Smith, pillar of the 18th century Scottish Enlightenment, who said that if markets were just allowed to do their thing, with everyone pulling on their own rope for their own interests, an “invisible hand” would ensure that justice prevailed. To be precise, in Wealth of Nations (1776), he says:

“ … by directing industry in such a manner as its produce may be of greatest value [the trader] intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor it is always the worse for society that it was no part of it. By pursuing his own interest he frequently promotes that of the society more effectively than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good.”

The invisible hand works, said Smith, because dishonest traders would soon be caught out, the word would quickly spread, and the bad guys would go out of business.

In reality, of course, “the invisible hand” would not work for the general good unless there was an infinite number of traders and the customers had perfect information and infinite time in which to make their choices. This can never be the case and in these days of oligarchic corporates it is as far from reality as can be envisaged. Often Tesco is the only store in town.  So “the invisible hand” is at best an abstraction. In Smith’s day, though, small traders in everyday circumstances were the norm, so at least his idea made sense. But then, it isn’t clear that Smith really meant what he seems to mean. After all, he was a moral philosopher before he was an economist and in his earlier book, Theory of Moral Sentiments (1759) he writes:

“How selfish soever man may be supposed, there are evidently some principles in his nature, which interest him in the fortunes of others, and render their happiness necessary to him, though he derives nothing from it except the pleasure of seeing it”.

Elsewhere in Moral Sentiments he speaks of the “Natural sympathy”, essentially as the glue that holds human societies together. Since the market is a human construct, run by human beings, the invisible hand is not as self-regulating as it seems. There may be no explicit moral rules (beyond those of the trading laws) but the hand is guided nonetheless by the innate constraint, the “decency”, of the traders. But in the neoliberal market in its pure form there are no moral rules – apart from the one which says that whatever can be sold is OK. The lying and cheating employed to promote what is not in the public interest are seen simply as tactics – all part of the competitive game – as advocated in the early 16th century by Niccolo Machiavelli. Modern right-wing think tanks of the kind that governments take seriously quote Adam Smith’s idea of the invisible hand, but make no reference to Smith’s own moral precepts, and seem unaware that he had any.

So that’s the first disaster: over-reliance on a market that has been deliberately stripped of morality on the basis of an 18th century idea taken out of context.

The second disaster has been the virtually unrestricted growth of the corporates. No single human institution should be as powerful as some of them have become – except perhaps a properly functional United Nations; a true democracy of intelligent people representing all humankind who take survival and justice seriously (a very high bar which the UN sometimes get close to). The fact that the course of all our lives is determined largely by the whims and self-interest of men in suits in another continent who have no knowledge of how we live and care less, is at least absurd. The fact that our elected government takes its lead from these men in suits and claims to be democratic, beggars belief. Of course, too, what is true of Britain is true to the nth degree of Africa.

The third great disaster has been the rise of “finance capitalism”: the means by which money itself, once accumulated, can be multiplied and multiplied again by esoteric tricks that include lending with interest, and investment with judicious selling when the price is right, and shifting from one currency to another, and so on and so on, all done by computer, and without moral restraint. The people who operate the computers skim off some of the money as it passes in cipher form through their machines, and so have become the richest of us all. Governments like those of all parties that Britain has endured since the 1980s claim that the wealth of this new super-class is of general benefit. It is after all supposed to “trickle down” to the rest of us and in any case it can be totted up and called GDP, which is seen as the great desideratum. All those people throughout Britain who can no longer afford to live in the houses their parents built because bankers and brokers have bought up the nicest ones and put up the price of all the rest, know better (although they continue to vote for the status quo). Most of the world’s trade these days is not in real goods that people have made, and which they need, but is in money. The money is a pure abstraction, multiplied by tricks of accountancy, but can be translated into real things. No-one gets rich by earning it these days, except perhaps opera singers and footballers. The dominance of abstract money, over physical reality, has given rise to “the debt economy”. Some of us are given the temporary illusion of wealth by borrowing. Houses these days are still meant for living in but are valued equally as collateral. The grand bubble of debt burst in 2008 but governments the world over had spent the previous two decades encouraging city people to puff it up. Now they are trying desperately to puff it up again. This is their only strategy. Again, as always, physical and social reality – including the realities of agriculture – are pushed aside. All must suffer while Humpty is put back on his wall. So –

What’s to be done?

Many feel and strongly argue that the only way forward is to “smash capitalism”. Many have been saying this, or something very similar, at least since 1867 when Karl Marx published Das Kapital.

But it has proved too difficult to “smash capitalism” – and, even more to the point, it is not sensible or necessary. The enemy is not capitalism per se but the modern aberrant form of it, neoliberalism; that, plus the unrestrained nonsense of finance capitalism that has grown on the back of it. Capitalism in more primitive form, stripped back to the basics, and with moral restraint that is imposed by society at large but to an even greater extent is innate, can serve us very well.

Right now, though, we have to look afresh at each of the individual components of capitalism. “Ownership”, for example, is not a simple concept. For starters it does not and should not imply absolute rights. A person may “own” a dog but at least in some countries, including ours, the owner has no right to be cruel to it. Different things are subject to different degrees of ownership. In most (all?) traditional societies people may well own their own cooking pots and so on but the idea of owning land was and remains unthinkable. By the same token, private enterprise does not confer an absolute right to make or to do absolutely anything. Thus, however profitable, it is generally forbidden to make weapons of mass destruction. Trading must be fair: cashing in on the fact that many other peoples have no concept of land ownership, then laying claim to their land and kicking them out, just will not do. Lending with interest is permissible and can be useful but it must stop short of usury. Overall, the market must operate within an agreed moral framework. British and American governments since the early 19th century generally saw it as their role in life to provide that framework, and control the market in the interests of the people. But since the 1980s, they have backed off. In effect, though in some ways governments like ours are more powerful than ever, they have abdicated. They interfere with our lives as never before, but they do not in any worthwhile sense govern.

The principles of agroecology and observation of the human condition suggests that the basis of all agriculture worldwide should be the small mixed farm, served by correspondingly fine-tuned local markets, with appropriately scaled bakers, brewers, butchers and all the rest in between. All we really need, indeed, is a nation of small farmers (as Thomas Jefferson put the matter) served by a nation of small shopkeepers (Adam Smith’s expression). The overall economy that results is what is commonly called “bourgeois” or “petit-bourgeois” or, in a rural setting “peasant”. These terms are commonly intended to be derisory because they are associated with “ignorance” or with “small-town mentality”. Yet there is absolutely no reason why they should be either. People from such backgrounds have often been among the world’s finest (Mendel, Shakespeare, William Blake) – but more cogent is the comment by one of the greatest economists, John Maynard Keynes, that the point is to create an economy in which:

“ … the economic problem will take the back seat where it belongs … and the arena of heart and head will be occupied where it belongs, or reoccupied by our real problems, the problems of life and human relations, of creation, and of behaviour and religion.”

[Quoted by Archie Mackenzie, Faith in Diplomacy, Caux Books, 2002, p 200. ]

In short, what might be called “low key capitalism” will do the trick – the basic components without the excesses of neoliberalism and finance capitalism;  and there is nothing frightening about it. Capitalism in such a form is not a threat to freedom. Indeed, it is the natural economy of a democracy – allowing control from the bottom up. The oligarchy we have now, of big business, big finance, and governments that do their bidding, is top-down governance writ large. Oligarchy is not far removed from despotism, although it is far more robust.

But although there is nothing intrinsically frightening about low-key capitalism –  indeed it was the norm until about 1980 – a few refinements are called for.

Low-key capitalism in modern form

British governments before about 1980 did not suppose that private enterprise, whether small-scale or large-scale, should form all of the economy. Through all the 20th century most British governments of all parties could properly be called social democrats – balancing private ownership (and enterprise) with public ownership in the “mixed” economy. In the 1950s Nye Bevan was seen as the archetypal British socialist and Harold Macmillan as the archetypal mid-20th century British Tory and they (and Bevan’s successor, Harold Wilson) squared off beautifully in the House of Commons, delivering a far higher class of rhetoric than is evident today. But although in the 1950s Bevan was seen to be “left” and Macmillan was “right”, both assumed that the mixed economy was morally good, and natural. Macmillan favoured more private ownership and Bevan more public but even so the difference between them was only one of degree. As Bevan said in his personal manifesto, In Place of Fear, published 1952:

“A mixed economy is what most people of the West prefer. The victory of Socialism need not be universal to be decisive … It is neither prudent, nor does it accord with our conception of the future, that all forms of private property should live under perpetual threat. In almost all types of human society different forms of property have lived side by side… But it is a requisite of social stability that one type of property ownership should dominate. In the society of the future it should be public property.”[Quoted by David Marquand in Britain Since 1918 , Phoenix, London, 2009, p 117]

Today, the idea of a mixed economy still works perfectly well. The present Coalition obsession with all-out private (corporate) ownership is far to the right of Macmillan, or any other Tory government before Margaret Thatcher (while in America, the democrat President Obama is said to be to the right of republican Nixon, and a long way right of Eisenhower). The status quo, in which the mixed economy has been abandoned, must be seen as a mistake.

But we should not conceive the mixed economy as a straight split between private and public, where public in practice means government and commonly means “state”. For as Martin Large describes in Common Wealth (Hawthorn Press, Stroud, 2010) – and this I believe as one of the crucial insights of our time – there is a third player: the community. Communities can be defined by area – as in village – or by common interest – as in the Dulwich Squash Club or the National Trust. Either way, communities at their best can combine the best features of private and public ownership. All individuals in the community should have influence, which is a key feature of democracy. But no individual can use the resources of the community purely for his or her own personal gain. Communities have the power to set up enlightened farms, and provide the markets, and ensure that they are never taken over by cruder commercial and political interests. They can in practice be cooperatives and/ or take one of several legal forms and can where appropriate operate as charities (if this is advantageous). Community is the thing, in short. In fact in the mixed economies of the future, communities should be the main players.

Secondly, companies, whether community-controlled or not, can be conceived as “social enterprises”. Social enterprises are supposed to pay their way – “wash their face” as the modern jargon has it – but their prime function to benefit people or the environment at large. They are not required to maximize profits, as modern commercial companies that vie for investors’ money are obliged to do. Several legal structures are already in place to accommodate social enterprises — it’s surprising and pleasing that even after 30 years of neoliberal fervour, the mechanisms we need to turn the world around are still (largely) in place. One such is the Community Interest Company, or CIC. Community-owned companies run as social enterprises clearly have great potential power.

Thirdly, there are many ways of attracting money to new enterprises of the right kind, from crowd-funding to various forms of “ethical investment”, offering various forms of returns to their investors. Our own new organization — “Funding Enlightened Agriculture” (FEA), launched at the 2012 Oxford Real Farming Conference – is designed expressly to identify new enlightened enterprises, help them to become “investment-ready”, and direct appropriate funding towards them.

In all these ways conventional and accepted financial mechanisms are directed towards enterprises and modus operandi that truly could be good for the human species, and our fellow creatures, and the world at large. The point is not to “smash capitalism”, in short, but to rescue it. Like science, capitalism has fallen into bad company.

But is the alternative doomed forever to be “niche”?

The powers-that-be, or one or two among them, might read all this but will then conclude that it is still “unrealistic”. It stands to reason, they argue, that only big farms can feed big populations – particularly when those populations live in cities, as half of all the world’s people now do. At best the kind of farming advocated here must remain “niche”, strictly for the well-heeled and self-indulgent. The serious task of feeding the world’s rising population must be left to the big boys, the high-input industrial chemists and the new breed of biotechnologists, who alone can provide the 50% more food that they say is needed (though some say we need 100% more). In any case, only supermarkets selling industrial produce can keep food cheap.

But of course (as outlined for example in my Colin’s Corner piece, “Owen Paterson, GMOs, and Agrarian Renaissance”) the world does not need more food. We already produce 50% more than we will ever need. The task is to produce the same amount, or less, but better. Besides, small mixed farms when well-run can produce far more good food per hectare, than large monocultures can, with minimal or no industrial chemistry, and no GMOs. Even though small farms worldwide have been sadly sidelined, they still produce 50% of the world’s food, while the high-tech, high-input, heavily subsidized industrial kind produce only 30% (the rest comes from fishing, hunting, and gardening). As for price: 80% of what we now spend in supermarkets goes to middle-men and bankers (who lend the money to buy the underlying high tech). Probably less than 10% goes to the farm workers who are the first to be booted out when the economic squeeze is on (to be replaced seasonally by migrants who have fewer rights and are even cheaper). But it’s the middle-men’s 80% that needs cutting – which is what local markets do.

Especially if owned by communities, small mixed farms and the corresponding markets need not be niche. Even at £25K per hectare communities could still buy worthwhile amounts of land. Three hectares can provide good fruit and vegetables for hundreds of people – and the beginnings of chickens and eggs as well. Every village could afford its own farm and nationwide the contribution would be huge. There are roughly 60 million people in Britain and 20 million recognized hectares of farmland so we, the people as a whole, could do a total buy-out of all of Britain’s farmland for £8000 per head (max). This is very little when paid back over a lifetime, perhaps in the form of a small tax, and if all farmland was publically (or communally) owned for the common good, the price of it would not contribute ever again to food costs, and this again would do a very great deal to reduce the price of food (far more than yet more sackings of farmers). We could also, easily, in Britain, be self-reliant in food. Self-reliance alone does not guarantee total food security but it does provide a very firm foundation. Community-owned small farms spread over the country and employing lots of people are also the stuff of food sovereignty – people taking control of their own food supply. So by community buy-out of agricultural land, which in principle is perfectly feasible, we could achieve both food security and food sovereignty, all within the context of democracy. Why don’t we go for it? Why not make this an explicit target?

So this is the kind of economy we need. Emphatically not neoliberal, but not “commie” either: just petit-bourgeois/peasant, low-key capitalism based on common sense and common morality, with community-owned social enterprises, and everybody in with a shout.

What is so frightening about that? Why do such notions arouse such ire in the powers-that-be? Probably because, the cynic would say, they could so obviously work, as they have often done in the past; and if they did, then the powers-that-be would lose their place in the Sun. But why should the rest of us care about that?