Politics Problem

I regularly mention the illusion of false scarcity. My line usually goes something like, “It’s not a resource problem, it’s a technology problem. The best example is oil. Should Earth ever actually release all its oil for human consumption, any of the several substitues already known could be a viable replacement. Or something new will be found. If we put our minds to it.

What happens when the technology works too well? In Belgium and around the world, milk prices have dropped very low. At the current price, supply exceeds demand. In other words, for $4 per gallon, farmers will make more milk than people are willing to shell out $4 for.

There’s no resource problem. The farmers have made more food than Belgians want. On the global scale, where there might be hunger because local milk is too expensive, this excess Belgian milk could help lower the price and help more people be able to afford nutrition.

The Belgian farmers dumped their milk on the ground:

Belgian farmers sprayed 3 million liters (790,000 gallons) of fresh milk onto their fields Wednesday, furious over the low milk prices they say are bankrupting farmers.

Milk farmers' groups said world prices had sunk so much they are having to sell milk at half their production costs, leaving more and more farmers unable to pay their bills.

To highlight their desperation, about 300 tractors dragged milk containers through plowed fields in southern Belgium, dumping a day's worth of milk production in that region.

Nobody owes Belgian farmers a living. This is a tragic result of assinine policy:

Since the recovery from World War II, farming in Europe has always been exempt from free market forces as governments sought to end hunger and rationing by paying farmers to increase food output.

By the 1990s, Europe's farms were paid to produce too much and the scandal of wasteful EU butter mountains and wine lakes prompted talks on reforming the industry to phase out state support. Quotas for milk production are scheduled to end in 2015.

Agriculture is still one of the most shielded economic sectors in the EU, but it has not been able to protect farmers from the global financial crisis that caused demand to crash.

We lost not only the milk, but whatever else of value the farmers would have produced instead. Maybe they would have made more meat. Or dropped out of farming and pursued an entirely different career. Less farmland means less fertilizer, which means lower costs for farmers everywhere. And less of the unwelcome fertilizer blooms in our oceans.

There’s a multiplier for waste. Just like spending a dollar puts many people to work every time it changes hands, every dollar set on fire is the end of a productive chain.

A society—or planet—that can pay people to grow and destroy food does not have a resource problem or a technology problem. It’s a politics problem.