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The Economics of American Agricultural
 

jntheriot504's picture
O
 
Points)
 on 2/11/13 at 4:00am
Markets

Economic discussion normally does not entail the government control over our food, yet this is exactly what is happening. The United States government has a subsidizes agriculture production in theory to provide a greater supply enabling lower costs. Granted processed food is extremely cheap, but whole foods, especially produce are very expensive in terms of dollar per calorie. Americans are unable to afford whole foods causing them to eat more processed foods, potentially leading to higher health care costs in the long term. The question that must be answered though is: how does a developing nation such as Turkey provide genetically modify free whole foods at extremely low cost?

Farmer's Markets in the United States are known to be a gathering place for hippies, tree huggers and wealthier members of society. Yet, in Turkey for $22 one can purchase:

  • 6 lbs of potatoes
  • 4 lbs of onions
  • 4 lbs of carrots
  • 4 lbs of cucumbers
  • 2 lbs of oranges
  • 2 lbs of tomatoes
  • 1 lb of broccoli
  • 4 lbs of chicken
  • 15 organic eggs

All spices are $0.50 for one ounce bags, if you prefer fresh herbs they cost $0.50 for three bunches. This is unheard of in America! These markets are filled with everyday people purchasing their weekly meat, produce and other kitchen staples such as honey, rice and tea. What is going on in America that citizens are unable to purchase food directly from farmers such as in Turkey?

Economically this is feasible as local communities would grow the seasonal produce native to that region and import from other states as needed; this is economics 101 as described by Adam Smith. However, the problem in America is politics. Companies gaining a monopoly share on the sale of genetically modified seeds is destroying agriculture. For centuries farmers planted their seeds in the spring then gathered the seeds from the harvest in the fall to replant again next spring. Monsanto with its ingenious plan, decided to develop a seed that resists its own herbicide, Roundup. None of this would matter in a free market enterprise, except Monsanto has deep political ties as stated in the beginning, government control.

The U.S Secretary of Agriculture, Anne Veneman, was on the board of Directors of Monsanto’s Calgene Corporation. The Secretary of Defense, Donald Rumsfeld, was on the Board of Directors of Monsanto’s Searle pharmaceuticals. Supreme Court Judge Clarence Thomas was Monsanto’s lawyer and the list continues from the Obama administration to George Bush Sr. What makes this company so dangerous are the tactics it has used against farmers. Each day $2 million are spent by Monsanto to seek out farmers who they believe are infringing on their patent. Farmers do not have the money to battle such a large company and are losing their livelihoods.

This problem runs deeper when we look at the 58% market control on corn seed by Monsanto and DuPont. Corn production is at all time high and the majority of it is not used for human consumption but for feed. Even scarier animals such as cows which cannot process corn are being fed this ingredient to fatten them up faster to sell. Moreover, if everything we eat either has been fed corn or has corn in it, what are we becoming? Over time corn has lost its original nutritional properties and is nothing more than a filler. Furthermore, contrary to popular belief high fructose corn syrup is not the same as sugar; one is a pure substance the other is made through a chemical process. How can America move towards an agriculture industry such as the one described in Turkey?

This entry does not begin to address all of the problems associated with food. How do we begin to regain control of our food supply? By economic choices, we must stop buying items containing a derivative of corn, which come from Monsanto’s seeds and begin to support local farmers who are open about their practices. This will require consumer knowledge and foresight. These measures indicate to the market that the consumer demands quality whole foods at a low cost. Is the American agricultural problem more than what is mentioned above; cultural eating habits, the convenience of cheap food or the lack of time in a nation so concerned about career progression that they aren't worried about what they put into their bodies?

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goldman in da house's picture

Are your numbers for Turkey

 
Points)
 on 2/11/13 at 3:05am

Are your numbers for Turkey adjusted for PPP?

jntheriot504's picture

No, they are not. I live in

O
 
Points)
 on 2/11/13 at 4:14am

No, they are not. I live in southern central Turkey so the numbers are accurate to that extent. Depending on which part Turkey you are in, income and lifestyle varies dramatically. Western Turkey is very westernized, with high levels of income. The further east you travel the poorer it becomes; far poorer than any place in the United States. A quick PPP adjustment would make those items listed $60. While I have not lived in the United States for a year I find it hard to believe that I would be able to purchase the same amount for $60.


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16rl's picture

http://www.numbeo.com/cost-of

 
Points)
 on 2/11/13 at 8:32am

http://www.numbeo.com/cost-of-living/compare_citie...

Based on this, poultry, eggs, milk and lettuce should be more expensive in Turkey taking average wages into account. It looks like Turkey has an absolute advantage on bread production over the US according to this source. Dont forget the influence the EU has on turkey with its CAP system; theoretically the CAP lowers food prices on EU neighbor countries due to its overproduction (the EU directly subsidies farmers based on volume produced).

mapr89's picture

As a person that eats a 100%

PE
(Baboon, 102
 
Points)
 on 2/11/13 at 8:32am

As a person that eats a 100% non-processed organic diet, I think the problem is bigger than that. Cultural eating habits in developed countries is awful, 95% of what is sold on supermarkets is processed, which means, its a fod like substance, not food. The additives and high amounts of sugar, salt and fat, are killing our society. Im not going to talk about conspiracy s@#*t or whatever. We are all sheep to the system, like it or not. Most of what we eat is not even food, that is why we get sick, and the thing is people see pharmaceuticals and modern healthcare as the solution. If we all stopped eating non-processed foods, pharmaceutical companies would make less money, doctors would also make less money, large corporations like nestle, coca cola, would not make money, even the dairy industry which is a complete scam, would die. Of course we love sugar, salt and oil, its highly addictive, and its 100% unecessary, even the "virgin olive oil" people seem to think we need. Besides that, people need to start being more self reliant; grow your own food, and know where it comes from. Monsanto is just destroying land and producing food that kills us. I recommend you watch the documentary "Processed People", its really good. You can PM me if you want to chat more about this topic.

When the Last Tree Is Cut Down, the Last Fish Eaten, and the Last Stream Poisoned, You Will Realize That You Cannot Eat Money

16rl's picture

mapr89: As a person that eats

 
Points)
 on 2/11/13 at 8:37am
mapr89:

As a person that eats a 100% non-processed organic diet, I think the problem is bigger than that. Cultural eating habits in developed countries is awful, 95% of what is sold on supermarkets is processed, which means, its a fod like substance, not food. The additives and high amounts of sugar, salt and fat, are killing our society.

A big source of the problem is indeed over consumption of processed foods (and red meat) but you have also a huge loss in the supply chain due to food being "non-comerciable" (rotten, broken or just too ugly to be sold). Some studies indicate up to a 50% loss of food taking a cradle to cradle approach.

I found this BBC documentary quite interesting a few months ago; you guys might enjoy it.

jntheriot504's picture

16rl: http://www.numbeo.com/c

O
 
Points)
 on 2/11/13 at 8:48am
16rl:

http://www.numbeo.com/cost-of-living/compare_cities.jsp?country1=Turkey&city1=Gaziantep&country2=United+States&city2=Dallas%2C+TX&displayCurrency=USD

Based on this, poultry, eggs, milk and lettuce should be more expensive in Turkey taking average wages into account. It looks like Turkey has an absolute advantage on bread production over the US according to this source. Dont forget the influence the EU has on turkey with its CAP system; theoretically the CAP lowers food prices on EU neighbor countries due to its overproduction (the EU directly subsidies farmers based on volume produced).

Gaziantep, which is on the link you provided is roughly two hours east from where I live, they produce pistachios and honey, key ingredients in baklava which extremely cheap: $3.5 per pound. As you stated bread has an absolute advantage. Three fresh loaves of bread (similar to French bread) costs $0.55; more simply put any loaf of bread will not cost more than $0.50, the French bread is the most common sold.


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jntheriot504's picture

mapr89: Of course we love

O
 
Points)
 on 2/11/13 at 8:47am
mapr89:

Of course we love sugar, salt and oil, its highly addictive, and its 100% unecessary, even the "virgin olive oil" people seem to think we need. Besides that, people need to start being more self reliant; grow your own food, and know where it comes from.

You are absolutely correct we love sugar, salt and oil, even though I have cut down it dramatically living in Turkey, I still have those cravings and eat them. As you stated a lot of is culture habits. Turks eat every meal together as a group, sharing everything that is cooked in which nothing is processed. On the other hand Americans eat meals along in their work space. Even if they bring their own food its more than likely a processed derivative. I attempt to cook every meal from scratch, but I still resort to the American habit of eating by myself. Do not get me wrong, they will eat chips and cookies but in much smaller amounts. Lastly, I can read and understand every ingredient on the chips and cookies bag; high fructose corn syrup is non-existent.

Also, thanks for the documentary recommendation I will be sure to check it out.


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mapr89's picture

Thanks for the video, good

PE
(Baboon, 102
 
Points)
 on 2/11/13 at 8:56am

Thanks for the video, good stuff!

inkybinky's picture

Farm subsidies in the US

AM
 
Points)
 on 2/11/13 at 9:53am

Farm subsidies in the US don't lower food costs. They apply a price floor which raises prices should they fall too much. The idea is to prevent price volatility from bankrupting farmers in years with too much production. It's a perpetual bailout because apparently farmers are too big to fail.

Fundamentally Undervalued's picture

Food, Inc. is a very good

IB
 
Points)
 on 2/11/13 at 10:24am

Food, Inc. is a very good documentary

buy it. ride it. sell it.

ricky212's picture

this is very stupid.

ST
(Orangutan, 356
 
Points)
 on 2/11/13 at 1:07pm

this is very stupid.

Because when you're in a room full of smart people, smart suddenly doesn't matter—interesting is what matters.

flonkkertiin's picture

I'd love for somebody here to

ER
(Monkey, 53
 
Points)
 on 2/11/13 at 2:59pm

I'd love for somebody here to go ahead and point me to one peer-reviewed study which proves that eating processed foods leads to health issues that don't exist in those who eat organic foods.

jntheriot504's picture

bradifer30: I'd love for

O
 
Points)
 on 2/11/13 at 3:14pm
bradifer30:

I'd love for somebody here to go ahead and point me to one peer-reviewed study which proves that eating processed foods leads to health issues that don't exist in those who eat organic foods.

All one has to do is travel to countries which do not eat processed foods and see the vast difference in their overall health.

Though you did ask for an article, a simple search that took 30 seconds revealed this: "Processed Meats and Risk of Childhood Leukemia" (California, USA) John M. Peters, Susan Preston-Martin, Stephanie J. London, Joseph D. Bowman, Jonathan D. Buckley and Duncan C. Thomas


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TNA's picture

I truly wonder how much

O
(Human, 13,467
 
Points)
 on 2/11/13 at 3:38pm

I truly wonder how much processed foods are unhealthy or is it the over consumption and lack of exercise that screws you. People that pound Doritos and pizza all the time also are probably less active and maybe heavy drinkers/smokers. Real hard to isolate the true driver of unhealthy situations.

And the argument that all this unhealthy shit hurts our healthcare costs is also debatable. The majority of US healthcare costs are incurred during the last years of life where people and families throw endless hail mary's to keep people alive another week more. In countries like Turkey that just doesn't happen.

So yeah, eating fresh everything is probably awesome, but it is also highly impractical and going to be expensive in countries like the US or Europe. Is it the canned veggies and the processed flour that kills you or is it driven by inactivity and other unhealthy things?

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mapr89's picture

It can be impractical,

PE
(Baboon, 102
 
Points)
 on 2/11/13 at 4:19pm

It can be impractical, depends on your priorities. If you prefer to drink up your money or buy a covertible vs. paying more for better food...

digikc94's picture

Fundamentally

PE
(Monkey, 50
 
Points)
 on 2/12/13 at 1:40am
jntheriot504's picture

TNA: Is it the canned veggies

O
 
Points)
 on 2/12/13 at 2:04am


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mapr89's picture

Cancer & Diabetes and those

PE
(Baboon, 102
 
Points)
 on 2/12/13 at 7:47am
Fundamentally Undervalued's picture

wall street oasis is now a

IB
 
Points)
 on 2/12/13 at 8:29am

buy it. ride it. sell it.

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