Feedback to “Plan to grow South West’s agricultural sector”

In his book, The Price of Inequality: How Today's Divided Society Endangers Our Future Joseph E. Stiglitz    says that in the US government for the people by the people has become government for the 1% by the 1% and the mechanism is that there are 6 lobbyists for every elected representative and the lobbyists are very good at presenting their companies interest as if it was in the national interest. I’d suggest that this report by Deloitte Access Economics amounts to a company representing the interests of big multinational companies, being paid by the Australian tax payer to write a report for the government. Effectively being paid to carry out lobbying. As an Australian citizen and tax payer, I object to this. The internet, the best of American enterprise and technology, is providing a more transparent environment so in the interest of open discussion I have posted this report and my reply with links from www.agritourismwa.com.au , specifically from http://touristradio.com.au/agritourismwa/food/SWDC .

 

The fact that this report talks of the dining boom replacing following the mining boom (p7) suggests that Deloitte Access Economics did not predict the crash in the iron ore price and so are totally lacking in credibility. The Chinese government corps are very good at acting in the interest of the people of China, boosting supply with foreign investment then crashing price as supply increases.

This is not a document written in the interest of WA agriculture but a document written to allow big businesses to further suppress prices in the agriculture sector. It is based on the same flawed logic as the rapid growth in the iron ore business.

I believe that this flawed document has been written by people who have studied economic principals but with no experience in the real world in which agriculture operates. Economic fundamentalists are as much a threat to our future as religious fundamentalists.

My Response to the Executive Summary

 

 

Market Structures.

The report opposes co-op’s because they protect the interest of farmers over big business, look what privatisation of Wesfarmers has done to primary producers . If we want to talk about a free market economy we need multiple players at all levels.

 

Skills and technology

Why would young people go into agriculture when the pay rates are so low compared with the mining industry? The only way we will be able to compete is if our wage structure moves to those of a third world country, why would we want to do that?

ABC 4 Corners, 5 May exposed appalling employment conditions in large primary producing companies, these practices generally are not so in owner operated family farms in WA.

While there is a place for technology, I’d suggest that the greatest increase in agriculture output is going to come from improved understanding of soil biology and managing the land to build soil biology rather than using lots of inputs that are derived from mining of minerals. We are going to have to return nutrients from human waste to the land. www.organicfoodwa.net.au

 

Biosecurity

The notion that biosecurity should not impede free market development demonstrates that the authors of this report have no idea of the real world. Free trade in unprocessed products is continuing to spread pests and diseases around the world, no amount of sugar coating by economic idealists is going to change that. We run the risk of losing the competitive advantage of the absence of diseases that exist elsewhere. There needs an acknowledgement of the cost to local production of the introduction of new diseases.

 

Red Tape

Red tape and regulation? Much of the South West abattoir capacity has been killed off by red tape making small operations unavailable. Even though there is no evidence that the lower standard facilities that existed before were responsible for any health problems.  This loss of diversity in killing capacity has allowed a few organisations to control the meat industry. Regulations are killing smaller operators as the compliance costs are a far greater % of income.

The Economy of Scale model has been sold by government and the banks since the 60’s . It seems to have resulted in the Cubby Station model for Australian agriculture,    borrow money to grow your business - go broke - get flogged of to the Chinese. It is at odds with the Stability through Diversity model which sees multiple operators, in which if any one fails it doesn’t matter.  Ref Small Is Beautiful: Economics as if People Mattered by E. F. Schumacher

Water issues

Water is going to be a huge issue, no glossy report is going to change that. Changing a water market framework is not going to create more water. In actual fact, it is more of an energy issue as vast amounts of energy are required to move water.  The issue of climate change has occurred through the wasteful use of fossil fuels. We have built an economy on the back of declining reserves of fossil fuels, we are going to need to get smarter.

Look to http://www.holisticresults.com.au/   http://savory.global/

 

General comments

 

The report also identifies Tourism as a growth industry, industrialized farming that this report advocates will become a threat to tourism potential. My company is linking agriculture and tourism through www.agritourismwa.com.au as a way to reconnect farmers and eaters, so that the City population becomes more aware of the issues faced by their food producers. Agritourism also has a place to play in educating farmers what consumers want because this feed-back, that is required for a stable system, has been broken by the commoditisation of food.

 The growth in demand for organic produce around the world is growing, driven by consumer demand not marketing push. www.organicfoodwa.net.au .

 We are being led by people walking backwards, trying to predict the future on the basis of past trends, and unable to see the lumps in the path that are going to trip them up. I’d suggest that this lump is climate change, and the rapid rise in the price of fossil fuels that will inevitable happen. Just because there is rising standards of living in China is not to say that this will continue, while it might be politically unacceptable to acknowledge that this reversal can occur, it is not to say that it should be ignored.

We often hear that farmers are going to have to produce more food for the growing population, but they are only going to be able to do that if their businesses are profitable. Farming input and transport costs continue to rise and it is likely that food is going to have to be produced closer to the consumers as energy prices escalate.

Why is the Australian government so keen to support foreign takeover of Australian instead of encouraging local entrepreneurship?  My company is proud to be a member of www.ausbuy.com.au  the only organisation representing the interests of Australian owned businesses. The government should be listening to them, rather than to organisations representing the interests of foreign investors.  

The implementation of this report will see Australians becoming tenants in their own country, much like what has already happened to the Aboriginal population.