From: James Rogers (jamesr@best.com)
Date: Mon Mar 27 2000 - 09:46:22 MST
On Sun, 26 Mar 2000, Zero Powers wrote:
> >From: James Rogers <jamesr@best.com>
> >How would you define "efficient and equitable" distribution of the dumped
> >grain?
>
> Efficient and equitable distribution is obviously getting the grain to the
> millions of people who are starving. Granted this is much easier said than
> done. But you'll never convince me that letting it rot and dumping is more
> efficient or more equitable than giving it, or selling it at "cost" to those
> who most need it.
You have a strange and rather arbitrary definition of "efficient" (and
"equitable" for that matter).
That you will "never be convinced" suggests a position that is not
rational in its basis. In fact, dumping *is* more efficient and to the
benefit of *everyone* in the long-term than doing as you suggest. I would
hardly call forcing a farmer to sell their grain at or below cost to be
"equitable"; it sounds like theft to me. Also, who will pay for the cost
of distribution, which is substantial?
Your proposed solution would destroy the agriculture industry within five
years, and then no one would have cheap grain.
> Yes I agree that the bulk of the problem with hunger in the 3rd world is the
> lousy governance going on over there. But how would it hurt the grain
> market here to give the grain to countries that can't afford to buy it?
You have not taken the economics into consideration. This is what really
happens with the current "free/subsidized" grain shipments to poor
countries:
Usually, most of the "free/cheap" grain sent as aid to foreign countries is
resold on the open market by those countries. However, because these
countries got the grain for below cost, they can undercut the prices of
the American producers who gave them the grain to begin with. The net
result is that all the cheap/free grain is destroying the grain producers
by artificially pushing the open market prices to levels that do not
reflect the cost of production and in some cases are pushing US producers
out of markets that they should legitimately have. This is what your
brand of meddling in the free market has done in the past.
I don't see how you could legitimately condone this kind of market
manipulation, given that it eventually makes grain less available and more
expensive for everyone. This really is a case of the free market being as
efficient as is possible, thank-you-very-much.
> Seems to me such a program might even be good for the US grain market
> in the long term. Because if you give them a freebie while they're
> down on their luck, by the time they are ready to buy they may be
> likely to by from us rather than Europe, no?
Those "freebies" aren't free. TANSTAAFL and all that. The grain
producers pay for it on the open market and in many cases lose money
because of these policies.
They are likely to buy US grain anyway, based on cost and quality alone.
Grain is a commodity; countries usually buy from the lowest bidder unless
they have laws that prevent them from doing so (which is relatively
common).
-James Rogers
jamesr@best.com
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