The Bangladesh Agricultural Research Institute (BARI) has just held a seminar to discuss their plans for organic agriculture in Bangladesh. This is easy: Organic is precisely the form of agriculture that the country simply doesn’t need nor want. The actual plan should be to wean those still using it off the idea and onto more modern and more productive methods.
It’s entirely true that organic is all the rage in the richer countries. Mostly because there are all too many people who don’t understand the basics of farming. But worse than this is the fact people don’t understand the economics here and that’s something that becomes dangerous when we start to discuss what happens in a poorer economy.
Sure, it all sounds great that there are “no chemicals” in food but that’s to entirely miss what does happen. 99.9% of the pesticides in food are those created by the plants themselves -- species which don’t do this get eaten by the bugs before they can reproduce.
That love for the natural and no chemicals in a rich country it doesn’t matter very much. Simply because, in a rich country, a rise in the price of food isn’t all that important -- that’s pretty much what being rich means. It’s when the idea intersects with poverty that it all becomes dangerous.
Obviously, the most important fact is that organic food costs more. We know very well that there are substantial numbers of Bangladeshis who face real and hard limits on the amount they can spend upon food -- raising prices is therefore a bad idea.
But as all studies of organic farming do have to point out, the system requires both more labour and more land for the same output against modern farming practices
We have also the simple truth that, before the 1960s, all Bangladeshi agriculture was organic. You know, back when there were real food shortages, even famines, with people actually starving to death? It was precisely the adoption of artificial inputs and modern farming which solved that problem. Why would we want to go back?
But as all studies of organic farming do have to point out, the system requires both more labour and more land for the same output against modern farming practices. We get less food from any particular amount of labour, we get less food from any particular amount of land by not adding artificial fertilisers, by not using herbicides and fungicides, by not using genetically modified crops.
Thus, organic farming produces less and more expensive food and farmers get even lower incomes. And we think that this will solve any of Bangladesh’s problems, do we?
Well, no, we don’t. Which brings us to the underlying basic problem here. Modern or chemical farming substitutes those chemicals for the land and labour that organic farming requires. That’s the whole point of it, in fact.
We have also another name for organic farming -- peasant farming. We might not use the word peasant in polite company these days very much but that is what we mean when we say “small farmers” and the like. And the problem with peasant farming is that those who do it end up with the lifestyle of peasants.
A basic truth about this world is that the lifestyle people can have depends almost entirely upon the productivity of whatever it is that they do. So, if a farmer with an acre, just to take an example, can produce $500 of product a year on his acre then his lifestyle cannot be better than $500 a year. And if he can produce $1,000 then the limit is double the amount. Note that this is the value added -- the value of output minus the value of input.
So, what happens when we adopt a farming method that requires more land and more labour to create the same output? That’s right, the value added falls, doesn’t it? Thus, inevitably, the standard of living of the farmer falls.
We can approach this the other way too. A bag of rice is worth, just as an example, $10. If that bag took the farmer 10 hours of labour to produce then the maximum farmer wage is $1 an hour. If it took 20 hours to produce then that top possible wage is 50 cents an hour.
By doubling the labour required, we’ve just halved the amount the labour earns. Thus, deliberately adopting a more labour-intensive method of farming isn’t the right way to be going at all. We’d much prefer to be using less not more labour so that the wages paid per hour can be higher.
This is of course true of everything in the economy. The more productive per hour labour is then the more labour will get paid per hour. Something we generally think is a jolly good idea as it means that the working people are getting richer. This doesn’t change just because a few rich world hippies like to think about their food being free of “chemicals.”
Which is really what is wrong with organic farming, or as we really should call it, peasant farming. Because it requires more labour and more land to perform and, therefore, inevitably, the people doing the farming will have lower incomes.
This isn’t something that we want in general and, more specifically, in Bangladesh, it’s something we absolutely don’t want to happen, ie falling farmer incomes.
The problem with peasant farming is that adopting the system means that farmers have to live like and as peasants. Forever. That’s not the point of economic development at all now, is it?
Tim Worstall is a senior fellow at the Adam Smith Institute in London.