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Comment by laingc | Hacker News Reader

The New Zealand meat and dairy industries do not receive subsidies after radical market deregulation during the Labour government of '84.

We have a highly efficient and profitable sector, mainly for the reason that we compete in fairly extreme conditions against subsidised international players.

Note that this process incurred significant pain for many individuals while the industry reoriented and consolidated, and I am not inviting any argument around environmental impacts (which I would contend are bad, but also clearly less bad than other countries).

So yes, "natural" meat can be competitive and efficient without government subsidies.

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All that is true, but - we also don’t force farmers to internalize the externalities created by their industry.

Southland farmers themselves are saying that if they had to comply with proposed water and soil quality regulations that they wouldn’t be able to exist due to the increased costs involved.

The backlash even from the introduction of a heavy vehicles tax are representative of how much these farmers think they rely on the unpriced benefits they are getting.

> if they had to comply with proposed water and soil quality regulations that they wouldn’t be able to exist due to the increased costs involved

People always say things like this until they are forced to, and somehow find a way.

(Particularly if imports were charged similar tariffs)

> People always say things like this until they are forced to, and somehow find a way.

That is one of two possible outcomes. The other is that the sector just dies off and relocates to another place on earth, where externalities don't have to be considered, maybe for strategic reason. This has happened many times.

This is why the EU is looking into carbon-based tariffs.

If you want to enact global change, you can't just change yourself, though it's always a good place to start.

And probably a major beneficiary of similar laws currently is meat production and animal welfare laws used to exclude imports.

It’s time to subsidise NZ farmers to at least encourage sustainable land use.

Farming is thankless, backbreaking, poorly-paid work that often is only viable because of subsidies the government provides, because the government recognizes that without farmers we'll all starve. And you're concerned that they're not paying their fair share. Fine. Good luck with that.

> they're not paying their fair share

That's not how it works. There is no fair share. He is saying that farmers are not actually paying the costs they make society incur. Therefore these costs are not priced into the meat they produce which would not be that competitive if that was the case. It's a form of subsidy.

The cost of food as a share of income has fallen dramatically over the last fifty years or so. It's not unfathomable that it rises a bit again in exchange for properly pricing in externalities.

Demand for food is pretty inelastic.

If the external costs were included, consumer would simply be forced to pay for their consumption.

This would give a fair advantage for food that has less external costs.

External costs are also hard to estimate, especially if they is burdened on another species. How much is the suffering of a chicken worth?

and yet if you actually did that, people on the other side of the political spectrum would complain that it's unfair for poor people because they now have a higher food cost burden. Shouldn't the rich subsidize for the poor for these essentials?

So then you get back to the original condition - subsidizing food once again. In fact, this is the reason why they are subsidized in the first place!

No, if you implement a efficient system to transfer wealth, you don't subsidize meat as meat and plant based food are treated equally.

If a less lucky person (or what you call poor) receives money, they are still incentivized to spend the money efficiently. With the money they have available now, they can buy less meat but more plant based food than before.

We could for example lower taxes for those that earn least while increasing water and soil quality regulations (with matching tariffs for imports). This would increase food costs, which would hopefully match the money that people gained through lower taxes.

Meat would then become slightly more expensive than plant, but also have a major benefit for products that don't use a lot of water or harms the soil. Aquaculture would get a big boost, as would alternative method of meat production. The use of farm animals as an ecological alternative to using machinery to keep land clear of unwanted vegetation has become a niche method, and increased water and soil regulations would indirect benefit such farming alternatives.

> we'll all starve

Please, every time someone proposes farmers lead a less cushioned life we get these huge bitter fights from somewhere. They don't also have to exist here. If you have a vested interest and want your subsidies to continue, that's cool! But there's no need to peddle your salty response to it when literally everyone everywhere has already heard them said many, many times.

>less cushioned life

Jesus Christ... Come spend a week on my farm and see how cushy it is.

I grew up in the countryside. I'm sure your farm is very difficult to live on, but I'm not so sure it's a general thing.

Edit: Besides that, a subsidy is a cushion. That's what I was talking about. That doesn't merit this response.

> All that is true, but - we also don’t force farmers to internalize the externalities created by their industry.

The net externality is probably positive, and if you want to start evening the slate using externalities then farmers would deserve a subsidy (which is bad policy).

Food is about as high on a supply chain as it is possible to get, and the entire downstream supply chain would count as an externality of the farmer's activity. If farmers didn't produce food we'd all starve to death, but that is absolutely not priced in to how much they get paid.

As I said, I really don’t want to get drawn into the environmental debate, but there is one persistent myth that does need to be corrected: the idea that emissions from “heavy” vehicles are not priced. They are. They’re in the ETS. Reductions in heavy vehicle use due to tax will not reduce carbon emissions at all, as it will be emitted elsewhere in the economy. The only way to reduce the emissions of an activity covered by the ETS is to lower the cap, which can be done without a vehicle tax of any kind.

We'd probably have to define what "not receive subsidies" means.

I'm pretty sure they don't pay for the damages caused by the methane and N2O emissions caused by the meat production. "We don't have to care about our externalities" is ultimately a form of subsidy.

And the results shine! New Zealand has the world's highest feed efficiency in poultry.

https://www.feedstrategy.com/poultry/new-zealands-tegel-poul...

A bit of googling says that New Zealand cows eat a lot of grain in both the beef and dairy industries. Grain is subsidized in many countries.

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