This August 26th piece in the Economist is an optimistic take ake on developments in Brazilian agriculture, likely from an author (the Economist rarely provides bylines) gung-ho about the Green Revolution and the Green Revolution-Plus of direct genetic modification. Possible negative long-term effects of industrial agriculture are therefore not much discussed. Still, the increases in raw current productivity seen in Brazil are undeniably impressive, and the piece provides a good opportunity to think about how and when agricultural policy works and does not work.
The author states that Brazil gives much less direct financial support to farmers than most developed countries, comparing the 5.7% of total farm income that the state provides in Brazil, to the 12% it accounts for in the United States, and the 29% figure in the European Union. The author gives most of the credit for growth in agricultural output to the Empresa Brasileira de Pesquisa Agropecuária (Brazilian Agricultural Research Corporation), shortened Embrapa, established as a public company in 1973, when rises in oil prices made Brazil’s traditional agricultural subsidies unaffordable. Its research allowed the cerrado grasslands of the Brazilian interior to be opened to agriculture (mostly by applying massive amounts of lime to the soil) and created breeds of cattle and soybeans that could thrive in Brazilian climates.
This immediately reminded me of U.S. agricultural policies in the first half of the 20th century, as discussed in a New Yorker piece by Atul Gawande. The Department of Agriculture’s role was to undertake and collect research into the most effective growing methods and crop strains, to be disseminated to farmers through local Cooperative Extension Services. No word in the Economist of a Brazilian equivalent to the Cooperative Extension Service, but in both cases the most important role of the government was in scientific research and the spread of technology (including crop strains) and information. In the U.S., the result was that
Productivity went way up, outpacing that of other Western countries. Prices fell by half. By 1930, food absorbed just twenty-four per cent of family spending and twenty per cent of the workforce. Today, food accounts for just eight per cent of household income and two per cent of the labor force. It is produced on no more land than was devoted to it a century ago, and with far greater variety and abundance than ever before in history.
The U.S.D.A. Cooperative Extension Service was established in 1914; the system did not prevent the soil damage that lead to the dust bowl. The systems established by Embrapa do involve crop rotation, no-till cultivation and the planting of trees; perhaps a more ecologically sensitive agriculture will avoid large large-scale disasters. Perhaps Brazil will in the future suffer its own equivalent of the dust bowl, or at least see effects akin to the eutrophication, soil depletion and pest problems caused by North American industrial agriculture. (Note that I’m not blaming the Dust Bowl on USDA policies, as I have no evidence for that, and I would guess that the over-farming that led to depleted soils would be more likely without government assistance. I’m stating that this more scientific approach to agriculture did not solve all woes.)
Whatever unintended effects negative effects new agricultural methods may produce, the role of researcher and coordinator seems a better one for the state than that of direct subsidizer, at least in the ways subsidies are currently handled in much of the developed world. In Europe, subsidies lead to mountains of warehoused cheese and ridiculous trade wars over bananas. In the United States, subsidies create incentives for wasteful water usage, and the various absurdities of dumping corn on Mexico, creating oceans of high fructose corn syrup, and the conversion of cropland to the production of corn destined to be converted to inefficient ethanol fuel.
As someone who has some interest in the success of local and sustainable agriculture, I have difficulty saying that no agricultural subsidies are desirable at all. A better system could replace the discounted water and direct payments that mostly benefit large-scale industrial agriculture with a system that gives more support to farms for remaining below a certain total acreage, while remaining above a certain level of productivity per acre (avoiding the scourge of “inefficient hobby farms” the Economist article speaks of) and selling a certain percentage of its product in the area which surrounds it. These small farms will continue to benefit from state-based research, while the now less-subsidized industrial-scale operations will be able to compete due to their economies of scale. Hopefully these small farms, given support and a more level playing field, can compete in price with the products of industrial-scale agriculture, thereby making local and sustainable agriculture more affordable for lower-income people, and removing some of its stigma as a whimsical élite preoccupation. The world’s states, meanwhile, can stop sniping at each other for giving their agri-businesses unfair advantages.