2020-10-07
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Value for value’s sake?

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Posted by Joel Woolf on 07 October 2020

Joel Woolf - Agriculture and Farming Lawyer
Joel Woolf Partner

‘Unprecedented’ is a word that is in danger of overuse but, as journalists and commentators point out, the level of change that society and the economy is experiencing is quite extraordinary. It is not all change though; the sun still rises in the east and sets it the west, and farmers are never happy about the weather!

Among the more superficial changes, we have experienced three major ones: a greater connection with the environment, a greater connection with our food (thrown into sharp focus by the sight of stripped supermarket shelves in the spring), and a greater awareness of the impact of obesity on our health.

Main drivers of world trade

Before exploring this further it is worth also reviewing two of the greatest triumphs of 20th century economists. Consumerism - the acquisition of consumer goods; and commoditisation - where goods, including raw materials, become widely available and, in the eyes of consumers, largely indistinguishable from one another. These two concepts have driven much of the development of world trade following the Second World War to the extent where even our politics are consumerised and commoditised.

Many are well aware of the impacts of commoditisation and consumerism on food: cheapness. The free market economy, driven by consumer demand, encourages businesses to compete on price but without sacrificing their profit margins. This means that the production process has to be streamlined and tweaked so that both consumers and producers are satisfied. When this is applied to our food, government financial support fills the gap between what consumers are prepared to pay and the cost of production; if it didn’t, food producers would go out of business and food costs would rise as supply is constricted.

The upshot of this is twofold. Firstly, producing cheap food has negative nutritional and environmental consequences. Secondly, large amounts of cheap, homogenous foodstuffs encourage overconsumption. It is possible for food to be high quality, environmentally responsibly produced and cheap, but never all three together. Often, price is the only consumer driver.

Public money for public good

It is an inescapable fact that the UK’s final exit from the EU is rapidly approaching and, although we have precious little guidance from the government about the replacement for the current CAP in respect of both pillar I and pillar II support, it is clear the government will be majoring on “public money for public good”. This implies a commoditisation of the ecosystem hand in hand with its twin, consumerism. In response, we have already seen attempts to value various ecosystems within the farmed environment and their effect on soil, water and air quality. We also have the various concepts and requirements that are beginning to be placed on developers around biodiversity net gain from building.

We have commented on the difficulty of putting a value on natural capital in the past. If, for instance, we put a monetary value on, say, soil, how long would it take before we sacrifice it in pursuit of profit? Experience tells us that everything is ultimately a trade-off - can we realistically protect and improve our natural world by reducing its constituent parts to pounds and pence? I would argue that the short-termism of our political system effectively mitigates against it - ultimately our politicians will make such decisions based on their chances of re-election and, for many, effective profit will triumph over environmental protection. Major construction projects are a good example. Their future contribution to the economy is often valued more highly than the long term environmental consequences of their activity.

Farmers are key to solving health and environmental concerns

Stepping back to the here and now, we know how lockdown, devoid of the rush and noise of modern life, gave many people the time and space to appreciate the beauty of nature. At the same time, government announced plans to tackle obesity, expounded on the importance of addressing climate change and ecosystem degradation, and published its food strategy. All worthy and good causes but there was one thing missing which ties these three things together: our farmers!

Farmers are custodians of our land. Without our farmers how will government get the benefit it seeks from “public money for public goods”? Without our famers how will we ensure food security and safety and, without that safe, secure, high-quality food, how can we tackle obesity? We don’t actually need to commoditise our ecology or our food chain. We need to educate consumers that food is derived from a precious resource and should, as such, be valued and not wasted just because it appears to be plentiful. We need to encourage consumers to pay a bit more, consume less but eat better, and thus ease the pressure on the environment. Technology will inevitably play its part, but only alongside a vibrant agricultural economy delivering what the consumer needs rather than what it wants. Government could have realised this by understanding and demonstrating more clearly the nexus that farming plays between food, the environment and tackling obesity.

Looking at the pictures of earth taken from the moon 50 years ago, it is hard not to captivated by the beauty of our planet. Those pictures show the earth as a lifeboat adrift in the vast oceanic darkness of space. It is the only lifeboat we have. If we commoditise our environment we risk selling it to the highest bidder. Would you sell that lifeboat to a passing shark?

About the author

Joel Woolf

Partner

Joel specialises in strategic advice to rural business clients.

Joel Woolf

Joel specialises in strategic advice to rural business clients.

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