AGree agricultural policy initiative releases five point-of-view papers on conservation policy

The AGree agricultural policy initiative today released five point-of-view papers related to productivity, profitability, and environmental outcomes.

The papers represent the diverse views of the authors, but one general theme is to encourage decentralized decision-making through which farmers and ranchers can address key environmental constraints, such as stewarding limited water quantity and protecting water quality.

For example, Kristin Weeks Duncanson, Jim Moseley, and Fred Yoder (.pdf) propose using local boards "to cooperatively establish and advance long-term productivity and conservation goals for their watersheds through engagement and support of producers and landowners and guided by sound science."

At their best, decentralized responses to environmental problems can have major advantages. Elinor Ostrom won a Nobel prize in economics for analyzing the ways that community-based decisions can in some cases address problems of the commons. At their weakest, decentralized responses may be insufficiently bold and comprehensive.

In AGree's press release this morning, Gary Hirshberg, an AGree Co-Chair and Chairman of Stonyfield Farm, describes the papers as a product of long discussion and a foundation perhaps for greater accomplishments in the future: “These papers reflect the intense deliberation that has gone into developing consensus recommendations and strategies,” he said. “To keep up with a changing climate, shrinking water supplies, shifting dietary preferences, and growing populations it is clear that we need system-wide change. AGree has focused on how new partnerships, innovative ways of working together, and targeted policy change can build trust and lay the foundation for a more sustainable future.”

Because the emphasis on decentralized approaches may not be matched yet with broader regulatory or tax-based responses to problems such as pollution, or property rights reforms to address water quantity, environmentalist readers of the five new papers may ask whether AGree fully acknowledges the determined national-level response that leading environmental challenges may require. I will be interested to hear which aspects of these five papers environmentalist readers find most daring, and which ones seem likely just to forestall or delay more vigorous initiatives.

In the paper by Duncanson, Mosely, and Yoder, I didn't yet get a strong sense of whether the local committees' work would add up in the end to quantifiable aggregate improvements, such as reduced total nutrient flow to the Gulf of Mexico, Lake Erie, and the Chesapeake. Perhaps one thing that could be added to their admirable decentralized vision is some mechanism for setting ambitious higher-level targets and getting buy-in from each local and regional board to do its part.

[I have been serving on AGree's research committee, where I've volunteered principally not on conservation but on a parallel discussion about nutrition policy. Of course, AGree is not responsible for my views here, nor vice versa.]

Economists and the restaurant industry offer input on the minimum wage debate

With support from the Obama administration, Congress is contemplating an increase in the minimum wage, in small annual steps to $10.10 per hour by 2016. After that, the minimum wage would rise automatically with inflation.

A group of several hundred economists signed a letter of support sponsored by the Economic Policy Institute. The letter said the proposal would help 17 million workers directly, and perhaps another 11 million workers by boosting wage expectations at the low end of the labor market. The letter said the weight of recent research shows "that increases in the minimum wage have had little or no negative effect on the employment of minimum-wage workers, even during times of weakness in the labor market."

A competing group of several hundred economists signed a letter of opposition. The letter says the consequence of the minimum wage proposal is "that business owners saddled with a higher cost of labor will need to cut costs, or pass the increase to their consumers in order to make ends meet. Many of the businesses that pay their workers minimum wage operate on extremely tight profit margins, with any increase in the cost of labor threatening this delicate balance."

In my own profession, several leading agricultural and applied economists signed each letter.

The New York Times this week pointed out that the letter of opposition was not really written by Vernon Smith, the lead signatory, who is a Nobel-winning economist. The letter was circulated by a firm hired by the National Restaurant Association (NRA), which has much to lose from the new minimum wage proposal. Smith is quoted saying he hadn't known who originated the statement, but he didn't mind that it turned out to be the restaurant industry, because the content of the letter is what mattered.

I asked a couple of my favorite agricultural and applied economists who had signed each letter if they wanted to respond to the controversy. One who signed the letter of support just confirmed that he supported the proposed minimum wage increase, but preferred not to say more.

Dan Sumner, a leading food policy thinker and economist at UC Davis, who signed the letter of opposition, gave this response. I had asked him if he felt "ill-used" by the restaurant industry. His email tackles the concern that the NRA support was non-transparent, discusses anti-poverty policies he judges superior to the minimum wage, and casts the minimum wage unfavorably in the context of other governmental efforts to set prices.

Parke:

I just assumed the min wage letter was developed and circulated by an interest group. Interest groups are the ones with enough interest to organize such an effort.

But, like Lucas and Smith, the proposition and argument itself is what matters to me. I have no connection with fast food places.

I put the minimum wage in the category with farm subsidies as a silly policy ill-targeted and worse than worthless for three reasons.

a. It uses policy resources, effort and attention, that would be better spent doing effective things to help the poor, such as earned income credits or targeted education programs or quality day-care or ...

b. It sends the signal that government price fixing is good policy more broadly. I know from my own specialty that government-set prices are generally bad policy. Thinking we can fix labor market problems or ill-trained workers or any other problem by having members of Congress set some favored price based on what their favorite lobby says it should be just encourages shoddy thinking.

(You will recall that is my problem with the press and the Congress continuing to act as though food stamps had anything to do with food. The reason I like the SNAP program is that is is unrelated to nutrition and the nanny notion that the feds should tell people how to spend their money, even charity.)

c. Minimum wage is so ill targeted as a poverty program and really does make it harder for some poor gal with very little to offer to get that first job. If I have to pay $10 anyway I can turn her away and hire only her sharper cousin, who already had a leg up.

Anyway, that's my off the cuff thinking.

By the way, the interest groups I have least time for are the ideological lobby groups and NGOs that seem to be very loose with the facts and analysis. These range from Heritage to HSUS to the Union of Concerned Scientists. My sense is these folks are just as likely to have an underlying bias to everything they do, and they pretend they act in the "public interest" relative to firms and groups of firms who have clear financial motivations.

Dan

Who favors transparency for artificial sweeteners?

What organization favors rules to make sure consumers know what artificial sweeteners are in manufactured food and beverages?

Thirty-years ago the number of ingredients used to sweeten foods and beverages could be counted on one hand. Today, there are 25 ingredients used to replace sugar. Regardless whether you think this change benefits our food supply or not, there is no question that consumer understanding of what is sweetening their foods and beverages has failed to keep pace with this dramatic change.

Today many foods, even foods that do not claim to be sugar-free, now contain artificial sweeteners. To assist consumers in making informed choices about what is sweetening the products they purchase, the Sugar Association petitioned the Food and Drug Administration (FDA) requesting changes to labeling regulations on sugar and alternative sweeteners. In this petition we asked that artificial sweeteners and sugar alcohols be identified on the front of the package along with the amounts, similar to what is required in Canada.

If it is important to you to know if the product you purchase contains artificial sweeteners, let your congressional representatives know that FDA needs to take action on this important consumer issue.

Yes, as Marion Nestle's blog Food Politics points out this week, under the headline "politics makes strange bedfellows," this public interest manifesto comes from the Sugar Association.  The sugar industry organization's slogan is "sweet by nature."

See related coverage of artificial sweetener labeling policy on U.S. Food Policy this March.