The Lunatic Farmer

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WHAT FREE MARKETS?

            In the comments to my post about anti-trust actions against the meat and poultry processing industry in which I pointed out that the answer is not government intervention, but freedom of market access,  some comments reflected the familiar refrain:  "but I thought free markets got us where we are."
          

  I've dealt with this in the past, but obviously not everyone is familiar with my take on this issue, so let me clear it up.  In 1906 when Upton Sinclair wrote The Jungle and exposed the failings of the large meat packing companies around Chicago, markets responded exactly the way they do when people have information and alternatives.

             Within 6 months, sales dropped 50 percent from those big companies--about 7 at the time--and folks returned to their local butchers and neighborhood meat and poultry suppliers.  It literally broke the back of the big outfits and returned sales to the decentralized, regional food system.

             That is the way free markets work.  They might get out of whack, like Sinclair documented, but then armed with information and alternatives people respond and withdraw from the offending businesses.  Free markets never assure perfection; they simply offer an opportunity for information and alternatives to control abuse and power.  As it turns out, that is enough.  It might take a couple of months, but people do respond dramatically to new information.

             The big packers were desperate for trust and validity in a plummeting market.  Teddy Roosevelt obliged their oblations by giving them the Food Safety Inspection Service (FSIS) to stamp "Government Approved" on their products and restore consumer confidence.  The big companies did not earn their new trust.  They bought it from a new bureaucracy.  That is NOT free markets.

             What it created was a system of paperwork, poke and sniff, and bureaucrats who could arbitrarily open and close facilities.  Suddenly both information and alternatives were controlled by an industry-regulator fraternity.  Isn't it interesting that in those days when half a dozen outfits controlled half of the U.S. processing capacity it was considered monopolistic but today when 4 outfits control 80 percent of processing it's considered free market?

             No, dear folks, we have not had a free market for a very long time.  And the government's manipulation of the processing industry, and its wholesale prejudice against small-scale facilities, has brought us to empty supermarket shelves and people fearful of running out of food. 

             When Joel Arthur Barker wrote the book Paradigms and introduced the concept to the world, one of his axioms was that over time, paradigms exceed their point of efficiency.  That's exactly where we are today in the meat and poultry processing industry.  The industrial paradigm has exceeded its point of efficiency and the coronavirus has certainly exposed its fragility.  Rather than going after these big processors with anti-trust operations, all we need is alternatives.  Lots of them.

             Scattered all over the countryside; little abattoirs at human and community scale, servicing their food-sheds.  The prejudicial war on small abattoirs waged by the FSIS has destroyed these alternatives.  Now that people have the truth and know the information about the vulnerability of mega-processing, they're looking for alternatives but the alternatives have been destroyed by the FSIS and a culture that believes bureaucrats are more honest than businesses; that believes consumers are too stupid to make provenance decisions.

             The day we allow freedom of food choice in America, all the mega-processing facilities will crumple like a house of cards.  Competition and diversity atomize the big players; government intervention concessionizes them.  No, folks, we are not where we are due to free markets.  We are where we are because people have asked for government oversight, and that has summarily destroyed diversity and competition.

             Would you buy food from a neighbor you trusted if that neighbor did not have a government license?