The problem with locavores — the breed of environmentalists who tout locally grown food, partly to minimize energy costs — is that they’re insensitive to the quality of the environment. A New York locavore spurns California tomatoes because of the energy spent trucking them across the country. But to focus on a small number of factors, like energy consumption, is to ignore a vast number of others: Do California tomatos, grown in locations where there might have been vineyards, displace California grapes? Do New York tomatos, grown in greenhouses where there might have been housing developments, lengthen morning commutes? What other useful services might California or New York workers provide if they weren’t growing tomatos? What are the alternative uses in each location for fertilizers, or farming equipment, or the resources that go into producing fertilizers and farming equipment?
Last August, Steven Budiansky, the self-described “Liberal Curmudgeon”, wrote a New York Times piece that I criticized on this blog for, essentially, making 1% of the right point and ignoring the other 99%. Now, having reread Budiansky, I think I was unfair to him. He had this right all the way through.
My complaint was this: Budiansky starts off by talking about all the energy costs that are ignored in the usual locavorian calculations — the energy consumed in heating that New York greenhouse, for example. But energy costs are not the only costs that matter. Therefore, any calculation that focuses strictly on energy costs leaves out a lot of stuff we ought to care about. Man does not live by BTUs alone.
I now see that, contrary to my over-hasty reading, this was exactly Budiansky’s point. He started off by looking at energy costs ignored by the locavores, and I mistakenly took that for his main point. But he goes on to argue (quite correctly) that all of those various energy costs are quite small compared to the many other social costs involved with growing a tomato.
The key economic point is that in practice, there is one and only one way to account for all those costs (or at least most of them) and that is to look at the price of each tomato, which largely reflects the opportunity costs of the land, the workers, the farm equipment, the resources that produce that farm equipment, and much more that matters very much but that you and I probably won’t think of on our own. This is the point I thought Budiansky had missed. But in fact, he concludes:
The best way to make the most of these truly precious resources of land, favorable climates and human labor is to grow lettuce, oranges, wheat, peppers, bananas, whatever, in the places where they grow best and with the most efficient technologies — and then pay the relatively tiny energy cost to get them to market, as we do with every other commodity in the economy.
Bingo. He had this right and I’m sorry I said otherwise. D’oh.
I agree that this is a correct critique of why one shouldn’t buy local for the sake of buying local. The real reason to buy local tomatoes is that locally grown tomatoes, grown in the summer season, actually taste good, and those shipped from across the country/world do not. I have no doubt that the local tomatoes at our local farmers’ market are not only more expensive but also involve more energy in production (and our special trip to said farmers’ market to purchase them). In spite of all of that, we buy them because they are delicious.
Phil, absolutely … but then you cannot claim (as so many seem to want to do) that you are being good to the environment by buying locally. In fact, you’re choosing taste over the environment. (Which personally I heartily approve of!)
Earth first! We’ll mine the other planets later. — Homer Simpson
I can’t believe that you – a highly trained, thorough academic – made such a huge mistake in the reading of the article.
This would be like a noble prize economist reading an article on who bears the burden of taxation and saying the author doesn’t understand how taxation works/fits together with the other parts of the economy.
@Will A: Not that I agree with your characterization but Krugman said exactly the same thing himself in his own series of D’oh! posts. Nice to see that both professors are equally capable of such honesty.
You misspelt “tomatoes”.
Can I just mention that I really appreciate the same level of critique applied to yourself that you apply to others. The introspection gives you more credibility in my mind. Willingness to admit your mistakes means (to me, at least) that you spend time thinking about where you might be wrong. Whatever passes through that filter has a higher probability of being right. Hence you have more credibility.
Please keep this up!
“Krugman said exactly the same thing himself in his own series of D’oh! posts.”
Where was this?
It is hard to be consistent, and I find it hard to accept the implications. The example I used in the earlier post was of battery (cage) chickens, veal crates and similar. In fact, any animal welfare issue. If food can be made cheaper by inflicting suffering on animals, following the above logic we must ignore the suffering, for a greater good must come through reduced opportunity costs. Price is our best guide to maximise social good. This does seem logical, but I find I do not actually live this way. In effect, I do not really “believe” in the result of my logic. It feels wrong to me, and I can’t tuck in to my chicken with much gusto if I know it has suffered. Logically, I could donate the saved money to a charity I care even more about than animal welfare, and surely the sum of welfare must then have been increased. Only if animal welfare is my number 1 priority am I justified in choosing the more expensive meat. If it was my number 1 priority, I guess I would be a vegan.
It seems to me that my priorities do in fact change, almost from moment to moment.
I also think that logically, there must come a point where we can assume the externalities add up to more than the price difference and take them into account.
Harold: I agree with you that there come points when we can reasonably believe that the externalities exceed the price difference and should take them into account.
But I also believe that most people, most of the time, tend to overestimate the externalities (because they are easily visible) while grossly underestimating the fantastic amount of information that is packed into the price (because most of it is invisible). Ironically, it’s the very invisibility of that information that makes prices so valuable; they are the only way we have of taking most of that information into account.
Steve, it is hard sometimes to separate a very important point from a general rule. I have found your points nearly always informative and thought provoking, and often it is hard to determine why I disagree with them. Usually, I find that I don’t disgree with the main point, but sometimes the application of the point in a absolute way. Thus you are making the point that price is usually undervalued, and externalities usually overvalued. A good point, well made, and very informative. In most situations the price gives us more information than we might usually give it credit for, but that doesn’t mean we can never, ever consider anything else. I now think that if want to consider factors other than price, I should have a very good justification for doing so, rather than some platitudes. Thanks for that.
Harold:
In most situations the price gives us more information than we might usually give it credit for, but that doesn’t mean we can never, ever consider anything else.
Well said, and I absolutely agree.
@Jeffrey: You mean Krugman hasn’t??
Ah, I missed the sarcasm the first time around.