It’s a Wonderful Loaf | Hacker News Reader

It’s a Wonderful Loaf

wonderfulloaf.org

47 pointsoli567937 comments

I appreciate all the comments. There is always a question of what is a "free" market. Government plays an important role in enforcing contracts and trying to preserve private property. And as some people have pointed out here, government subsidizes wheat, keeps out competition, and so on. Yet in many cities with very different roles for government, bread is still plentiful. What the poem tries to get at is the fundamental principal of emergence that makes bread plentiful across diverse political environments. The most important "free" part of those markets is allowing prices to adjust. Governments that play with prices (Venezuela is the tragic example today) can prevent the supply of bread from emerging.

For those who want to go deeper into these ideas there is an annotated version of the poem here: http://wonderfulloaf.org/poem and a long list of essays, talks, and interviews on the ideas in the poem, here: http://wonderfulloaf.org/resources

> [Boris] Yeltsin, then 58, “roamed the aisles of Randall’s nodding his head in amazement,” wrote Asin. He told his fellow Russians in his entourage that if their people, who often must wait in line for most goods, saw the conditions of U.S. supermarkets, “there would be a revolution."

Supermarkets and food production are an excellent example of how markets work effectively in Western countries. One of the great practical liberties gained from those who escape state run economies is one of consumer choice.

[0] http://blog.chron.com/thetexican/2014/04/when-boris-yeltsin-...

Oh yes. Food production is now dependent on a handful of companies supplying to the major supermarkets. This became apparent recently in the UK when hummus was contaminated with a yet unnamed contaminant that gave it a metallic taste. Most supermarkets were affected and had empty shelves. [0]

Milk is another example: supermarkets have used milk as a loss leader to entice people to shop with them for their weekly shop. Now farmers are being squeezed. The bigger ones can invest in more automation, the poorer ones cannot.

What happens when food production is concentrated in the hands of fewer companies?

What happens when a supermarket chain decides that they can bring increased efficiency to food production and farming by controlling from end to end. Isn't that what Amazon has done with deliveries and Amazon Logistics?

Immediately there's an efficiency improvements and the cost of bread can decrease. Competitors go out of business. But we're now dependant on one source for bread. What method do they use to decide how much bread to produce?

This video presents an idealised version of capitalism and attacks a straw-man of central planning. Crucially, it does not mention that during times of war, when resources are scarce, that all that the video celebrates gets abandoned and something that looks suspiciously like central planning gets adopted.

[0] https://www.theguardian.com/business/2017/apr/25/humour-bypa...

I would argue that integrated markets and mutually beneficial trade are a big reason countries don't go to war.

Markets are wonderfully adaptable, much more so that central planning. Don't have to source right now but I read that Japan had supplied most of the US rubber before ww2. After the war broke out and trading stopped, there was a big incentive to develop a synthetic rubber, which was accomplished very quickly.

It is therefore a curiosity that the most free-market obsessed leaders appear to be those most likely to pursue conflict.

How do you prevent monopolies? Ideas that lead to wealth decay or redistribution seem to be an anathema in modern capitalist societies. Regulation apparently stifles the market. How does the monopoly avoid overproduction? Lean methodologies?

[edit] Edited too much out to the point where it seems curt. I'm interested in free-market proponents' views on monopolies. Also, forgot to mention I found the info about synthetic rubber to be particularly interesting -- Wikipedia has more info including posters.

[0] https://en.m.wikipedia.org/wiki/Synthetic_rubber#World_War_I...

> It is therefore a curiosity that the most free-market obsessed leaders appear to be those most likely to pursue conflict.

Source?

List of ongoing armed conflicts [0]. Very little in relatively free-market areas such as the US and Europe.

[0] https://en.wikipedia.org/wiki/List_of_ongoing_armed_conflict...

The U.S. and other leading colonial governments have interfered in foreign governments for decades. Source: Noam Chomsky.

Okay, compared to non-market economies that have been bastions of civil liberties?

The US would have tremendous incentive to develop synthetic rubber because of the war anyway, markets or not.

an unnamed contaminant?

You mention lots of what ifs, but the reality is this, in the most capitalist countries it almost never happenes that there is not bread.

Even if these large companies control much, if they had problems the huge demand would mean lots of other people would have a huge insentive to get into the market. There are lots of other companies who have the fundamental tools to get into that market (logistics, financial, connections to sellers) and so on.

Cenral planning is not a straw man, it has been one of the most powerful ideas in the 20 Century that had a huge amount of peole behind it, from top ecnomist to top politicans not to mention a huge intelligentsia. Yes the modern left does not buy these ideas holesale but the principle problem is the same, their criticism derives from the same underlaying assumtions.

> Crucially, it does not mention that during times of war, when resources are scarce, that all that the video celebrates gets abandoned and something that looks suspiciously like central planning gets adopted.

Its only partly correct that during war everything is central planned, the most effective war time economy were served by a efficent market in the background.

However you are somewhat correct, the problem is just that they are different problems. In a free society usually the goal is that everybody can live their lives according to their own wishes. Markets are great for that. In a free society that goes into a total war all people demand survival above all and focusing on that demand can constrain consumtion and focus almsot everything on one goal.

So yes, if your only goal in society is to produce bread, then having a war style economy to focus everything on that one goal, markets will lose. However if you want to be a free society where people determen their own goals, markets are what you need and want.

For a counterpoint, see the "Victorian Bakers" doc from the BBC: http://www.dailymotion.com/video/x4h8mty. See 11 min mark for bakery conditions and 23:30 for flour adulteration. The free market at its finest with no regulation.

How is that a counterpoint? The video did not claim that during this nobody would ever have bad working condition.

Also, what possible society could you imagen where during that time you could support citis of a massivly growing population with a constant stream of bread without people actually doing that sort of work.

Only because bread could actually be supplied to so many people was it ever possible for Britain to grow so large in population and basically invent the modern world.

It's a badly-rhymed, gushing praise of the "invisible hand".

I assume it's meant for indoctrinating children into free market ideology.

A very succinct summary. I think the slick video frame intro animation has helped it trend.

It's complete nonsense. Wizards? More like straw men.

Actually my four-year-old just walked in.

Me: How does bread get on the shelves?

Tremé: By people carrying them. I don't know how they get up. People lift them and put them on the shelf.

Me: If they don't have the bread we like, what happens?

Tremé: Uh... they let... we would just eat them.

Me: What if a lot of people said they didn't have the bread we liked?

Tremé: They would give bread to someone else that didn't have food, and they would get their money to have a different kind of bread.

Me: Are there wizards?

Tremé: No.

Your son seems smart!

Most of what they are indoctrinated into is quite the opposite.

This video isn't my cup of tea, but Roberts' EconTalk podcast has been educational and illuminating for over 10 years now - highly recommended.

The bread example is funny, considering how heavily subsidized wheat is around the world. So where's the creator of this video at in repealing the farm bill?

There's too much "market demand" for a farm bill that works for some farms and not others. They have "bought" politicians who deliver what they "demand".

If you're genuinely interested, the writer of this poem, Russ Roberts, has in fact interviewed Daniel Sumner on that very subject, and they discuss in detail what subsidies exist in American agriculture, and the political economies that make them difficult to repeal.

http://www.econtalk.org/archives/2015/02/daniel_sumner_o.htm...

Can't argue with that :)

Are you really trying to argue that witout subsidize supermarkets would not be able to have bread for everybody?

This video proves that mammon is still as much of a religion as its always been.

> True economic maestros are as rare as unicorns

Are they? In the sense of fantastical dreams of communism, yes, but I think we are seeing proof every other week that the opposite is true. There is a staggering amount of power concentrated on few individuals/families, carried across generations.

Software plays a big role in making this more efficient at a huge scale. Point-of-sale / inventory / logistics systems enable the supply chain to make better use of all this free choice.

Well lots of technology is both invented and used to meet all these challanges. Maschinery for mass production was also invented because you can now sell to huge markets.

Taking a bread loaf. What a horrible choice. If anything is as far away from a free market - its the food and power supply markets.

There are incentives by near all states for constant overproduction. The remainder is shipped off as animal-food or gift to poor countries (basically produce bound charity). And that's just the farmers. The millers have vanished in Germany over the last 20 years until there where just a few left. Those few do stuff with the flour to get it up to decent "quality" >> https://de.wikipedia.org/wiki/Mehl#Zusatzstoffe_.28Mehlbehan...

Now its reached the baker, one of those jobs i did before i learned to code. Let me assure you, that the market will not cover you, if you are to exotic and small. We had one customer asking for gluten free bread- and my boss said no, cause it would have become ridiculous expensive and the customer was unwilling to pay more. By now super-markets have the stuff, but its produced by factory bakery's. Which are quite "something" if you listened in on the chat among those who learned baker there. Production has to roll no matter what. Mice squished dead in the bun machine? Kärcher to the rescue, steam and water - and go. Adding cheap substances, instead of expensive ones - surely the market would behave against that.

The invisible hand also doesn't regulate for invisible effects. Alot of shortsighted agents result in shortsighted behavior. My current boss, a really nice guy, has wrestled for years with chronic skin inflammation- and wonder of wonders, it vanishes if he did not buy factory products- try it- buy the raw ingredients and produce your own food.

So yeah, the health of the customer is a secondary concern, if the state is not watching - as in the US. Food Diseases taking out every 1000 Person- the invisible hand gives you the invisible thumbs up for that. https://wwwn.cdc.gov/foodborneoutbreaks/

Poor flour, with lots of ergot, that's okay as long as you dont get caught, if you dislike that - talk to the hand. You can market it as bio- and in that case your customers are lucky, if your field is next to a conventional farm, getting windswept by fungicides.

So, after carefully thinking- and comparing it with reality, this video must be a parody.

Your arguments against markets can be boiled down to:

1. It's not actually a TRUE free market, which is tough to argue but seemingly would invalidate all your next points. I think "free" is a relative term compared to the state-run model of food production.

2. Gluten free bread was not available in your bakery because it was too expensive and customer was unwilling to pay more (markets working). But gluten free bread is available at other retailers (markets working again)

3. Cheap ingredients are bad and more expensive ingredients are worth the extra cost, which is really a value judgement that you are free to make by buying bread from your baker (markets working)

4. Market doesn't regulate "invisible effects" but you don't state any support that the alternative (presumably food czar) would be able to capture "invisible effects"

5. Food safety is more of a concern and better managed by some "food czar" than the individuals effected. When in practice, food safety is better managed by a "last time I ate this I got sick" approach to choice. Food safety is much better in market economies.

Overall, the main problem with your argument is that it compares market conditions to a perfect ideal without any account for cost and practicality

1. The argument for constant overproduction, and non-availability of a real free market is called: starvation. If to many farmers give up, and speculants on futures can hold grain back, people starve. Has happened several times. One could argue, that this has positive outcomes as well- ideologues are less energetic on a purely capitalistic diet. PS: Because there is always a counter example that markets could work- here is one: https://en.wikipedia.org/wiki/Emperor_Norton

2. That example is one of a working market yes. But as you can see in medicine for rare diseases, no, not everybody gets a chance to buy what they need. In a pure free market, you have to pray for a rich person to get the same exotic sickness as you, to get help.

3. Yes, but the result of those wrong micro-judgments, piles via insurance upon society. Or its getting paid by having horrendous security payments, to keep those struck with the avalanche of their bad decisions, becoming poor from taking whats yours (The US approach).

4. Invisible effects, which i stated a nice example and you in intellectual dishonesty submitted, include very small accumulating negative effects or negative effects on the allmende, which come back later.

5. No, the food czar can be gambled too. I heard from some colleagues how in factory bakery's, when the health inspector arrives, clothing is adjusted and other violating points are "fixed" for the time of the inspection. But there is room for improvement there. In a free market, if all bakers just agree on the lowest common level of product, they churn out health bomb after health bomb and nothing happens to them. At which point i presume you would point to the jurisdiction of the nightwatch state- which by virtue of the free market could be bribed out of existence.

My perfect ideal is not very perfect, its just a acknowledge that there must be machinery that reigns in corroding elements, while leaving the positive aspects of the market largely intact.

I will leave you with the nice results a free market has created, and which you will hail as a great opportunity to sell health apps and bypass surgery. https://en.wikipedia.org/wiki/Obesity_in_the_United_States

I may take the right with others so inclined to opt-out this ideology.

You make a good point. Communist countries tend not to have a lot of obesity.

Eh, i m not arguing pro communism, im arguing for some bureaucratic oversight as it happens in the EU and Germany.

Its fascinating that fanatics always see just the other extreme. There are shades of grey, and i m arguing for a quite sophisticated machinery printed in black and white - in such a fashion that it looks grey if zoomed out enough.

1. Over-production happens because farmer in modern politics are efficent at lobbying politicans. In actualy market economies we basically don't have starvation. Speculation might cause starvation in countries that are not well integrated into the market, but then again without a world wide market for grain (that enables speculators to exist in the first place) many of those countries would just not have access to that supply in the first place.

2. Almost all technology is first limited and expensive and the gets cheap and mass produced. There is no magic way around this problem, its simply impossible. Medicine is a difficule topic and economically very different because of intellectual property being such a complicated subject. That said, if you look at the long term, the massiv expantion of live in countries is defently connected to the efficent distribution of lots of medicine to all levels of the population. You seem to focus on the problem we have now but ignore the trend.

Even a bad and cheap AIDS treatment now is better then almost anything available not that long ago.

3. It's hard to determain what the best solution here is. The problem is just to complicated. Their is some level of balance that society needs to find. Whatever process of law generation your society have needs to come up with this balance. I want argue that the one the US or anybody else has is perfect, but they seem pretty functional overall. More so then alternatives.

4. "if all bakers just agree". Your argument totally fails into the water if you say 'if all just agree', the hole point is that they can easly just all agree. The larger the market, the harder it is to agree. Even if they agree, every single one of them has a insentive to break the agreement. If you actually study the history of this sort of agreements you will see that they almost always break down even if the emerge (witch they almost never do).

Your argument seems to boils down to "markets working."

But they're not working for everyone. For example, the current housing market is working for large real estate companies that had the capital to buy up risk laden foreclosed homes. It's often not working for working class renters.

Again, not working compared to what?

In the cartoon, an example is given of bread using all the wheat that is needed for pizza dough.

Well, for people I know who work 40 hours a week and are still homeless, compared to anything.

The commodification of homes and neighborhoods is pushing people to participate economically in ways that cut short time for other important life stuff: self care, raising children, building healthy relationships, cleaning, cooking, creating, gardening. There is plenty of space to live, but these markets are making it very difficult for people to make the kinds of decentralized arrangements the cartoon espouses.

I don't think it's commodification. In cities where the government doesn't artificially make it hard to build new houses, housing is much more affordable.

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