Comment by bboygravity | Hacker News Reader

Comment by bboygravity | Hacker News Reader

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> And even if someone farms for selling to others if they don't have reliable access to machinery the farms will be really small as that just does not scale up (just take a look at pre industrial world where something like 90% of people were farmers)

You seem to assume/imply that small farms in the developing world cannot scale up due to economic/business reasons.

However in some developing countries, farms cannot be scaled up due to legal reasons. Countries like The Philippines don't allow ownership of farmland over one or two hectares per person. For companies the maximum is 5 hectares if I remember correctly. Foreigner investors cannot legally own any land whatsoever there (not even through a company, because foreigners aren't allowed to be majority share holders).

Is that good or bad? I don't know. Agriculture world wide is a highly regulated and highly subsidized non-free market that has very little to do with the concepts of capitalism and free market. This should probably be analyzed on a country by country basis with a couple of history books handy.

Random facts that I like about farming subsidies in the West: if farming in the Western world wasn't heavily subsidized, it wouldn't exist in the Western world. The reason for the farming subsidies is to have internal food production in case a war prevents sufficient food imports.

I agree with most of your comment but the final paragraph is a bit ????

> if farming in the Western world wasn't heavily subsidized, it wouldn't exist in the Western world

It probably would change, but it's weird to suggest it would stop existing without governmental subsidies. Most farming in the West is either intensive mass-production of commodities or sectorial, high-margin goods like wine. For the most part, agricultural subsidies are helping small businesses in sectors where they aren't really competitive (mostly by making the taxpayer or the consumer pay the difference, but that's another story...). Again, not to say subsidies are wrong per se, but I don't follow your reasoning there.

> The reason for the farming subsidies is to have internal food production in case a war prevents sufficient food imports

???

Most Western countries (with the possible exception of the US, I don't know) aren't agriculturally self-sufficient, nor it is a goal for them to be. In case a war broke out, energy supplies would be a much more pressing concern, especially for Western Europe.

He's right. Western Europe heavily imports laborers from Eastern Europe, Turkey and North Africa for many crops. Germany opened its borders at the height of the first Covid-19 wave to allow workers from Romania to come, when Romania was a hot bed for Covid-19.

Many Western countries are self sufficient agriculturally and they are huge exporters.

Agriculture is a cornerstone of national security. Life sucks when you are rationing fuel or imposing lights out curfews but it gets dire (and dangerous!) when people starve.

> Germany opened its borders at the height of the first Covid-19 wave to allow workers from Romania to come, when Romania was a hot bed for Covid-19.

Just a small correction, you've got your data the other way around. Early to mid April when Asparagus-Gate happened, Romania had at the very worst 500 new daily cases for a population of 19 million, while Germany regularly had 4-5000 for a population of 83 million.

So in essence Germany was a hotbed.

You were probably testing at least 10x more than we were, at the time ;-)

> Again, not to say subsidies are wrong per se, but I don't follow your reasoning there.

The reasoning is that it is so much cheaper to produce food in some low income countries (less/no regulations, lower wages) that the Western world would never be able to compete with it without subsidies.

I'm not an expert on farming at all, but as far as I know at least in the EU, all farmers are dependent in some way or another on subsidies. In other words: it wouldn't make financial sense to farm in the EU without subsidies. I'm assuming it's the same in the US, but I might be completely wrong. Correct me if I'm wrong.

Hence my conclusion: if farming wasn't subsidized in the Western world, it wouldn't exist in the Western world and it would all move to low income countries that aren't as regulated and have cheaper production. Just like the production of the vast majority of the rest of our goods I guess?

> Most Western countries (with the possible exception of the US, I don't know) aren't agriculturally self-sufficient, nor it is a goal for them to be.

?? This looks pretty self-sufficient to me? http://capreform.eu/trends-in-eu-agricultural-self-sufficien...

Or at least enough production to survive a war or other crisis.

Being from The Netherlands I know that we export a ton of food (a tiny country that is the second biggest exporter in the world behind the US). We also heavily subsidize food production.

If self-sufficiency of food production (in case of crisis) wasn't a goal of the Western world then I have no idea why we would have any internal production at all? Why would you subsidize food production within a geographical region for any other reason than food security?

> In case a war broke out, energy supplies would be a much more pressing concern, especially for Western Europe.

Ah? I would think that both (food security and energy security) are dependent on each other, equally essential and pressing? I mean: you can't have one without the other in times of crisis.

It's a bit off-topic, but I can't think of many policies that are geopolitically dumber and more dangerous than European energy policies (with perhaps France being the only exception). Example: Germany is in the process of making itself voluntarily completely dependent on Russian gas for the vast majority of it's average energy consumption ( > 60 %) and for more than 90 % of it's base load production (when there's little wind and sun).

> Why would you subsidize food production within a geographical region for any other reason than food security?

Here in Norway food security is only one of the reasons, at least it seems that way. Another very important one is that a farm requires workers, machinery, and material. The workers need doctors and their children need schools, the machinery needs mechanics, the material (fuel, fertiliser, cement, wood, etc.) needs transport. So by subsidizing a farm thousand metres up a mountain we generate enough business to keep a small community alive and prospering where otherwise there would be no one. This in turn means that there will be people nearby who will see an opportunity for other businesses such as tourism.

This means that on the 700 km journey through the mountains from Oslo to Trondheim you are rarely more than a few tens of km from the nearest petrol station, fast food outlet, hotel, and that it is rare to drive more than a few km without seeing a house or cabin.

Without farming in the valleys there would be no secure employment in these areas because the only other income is from tourism which is very seasonal and also easily disrupted by events such as COVID or any downturn in the economy.

While I agree with you that the EU is roughly self-sufficient, food security is not the only goal of EU farming subsidies. France has strongly supported these subsidies, which replaced domestic French subsidies, because of the effect on rural life and the rural economy. Subsidies are the reason that millions of small farmers can make a living, the reason that many French villages still exist, one of the reasons for that high quality local produce made in small batches is available cheaply all over France, and one of the reasons that retirees from the UK and Netherlands like to live in rural France (the much more intensive farming in those countries makes rural life quite different).

New Zeeland ended all agricultural subsidies in, IIRC, 1984. Seems to be working out pretty well for them.

That being said, there certainly are good reasons to have rough food self sufficiency and resiliency for crisis situations, rather than going all the way with free trade and Ricardo's comparative advantage arguments.

I just hope the EU could direct it's farm subsidies to emphasize the environment, and not dump as much excess products on the world market, driving poor 3rd world farmers into bankruptcy.

> Is that good or bad? I don't know.

I do. It's good.

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