Allowing a single corporation to dominate a critical sector
of our economy is risky. As an example,
we will consider the corporation Monsanto and how its activities affect
us. We will begin with economic issues
before discussing broader social concerns.
An absolutely free market where competition reigns and
all companies are continually at risk from competitors may be efficient at
keeping prices of goods low, but it is also very efficient at keeping wages and
company earnings low. Such situations
have traditionally led to chaotic conditions characterized by severe swings in
economic output. To protect themselves
from such volatility, companies began to collude with others to form “trusts” or
monopolistic constructs that would provide some degree of control over the
market and keep prices at a level where a profit could be guaranteed.
There were good and bad aspects to this monopolistic
trend. A healthy company with long-term
prospects for profitability is a stable company that can think in terms of
investing for the future and providing better products. On the other hand, a company that is too secure
in its market niche has little motivation to keep prices for its products
low.
There clearly needs to be a balance between market
control and market chaos. It has become
the function of government legislators and regulators to provide the appropriate
balance between market dominance and market competition, with government
prosecutors and judges acting as referees.
The central argument put forth by Robert B. Reich in his
book Saving Capitalism: For the Many, Not the Few is that the balance has shifted
too far towards market dominance as we face a situation where wealthy
corporations have the economic and political power to create rules and
regulations that work in their favor.
“All this has hobbled smaller
businesses. Contrary to the conventional
view of an American economy bubbling with innovative small companies, the reality
is quite different. Intellectual
property, network effects, natural monopolies, expensive R&D, fleets of
lawyers to litigate against potential rivals, and armies of lobbyists have
created formidable barriers to new entrants.
This is one major reason the rate at which new businesses have formed in
the United States has slowed markedly in recent years. Between 1978 and 2011, as the new giants
gained control, that rate has halved, according to a Brookings Institution
study released in May 2014.”
“They herald the ‘free market’
as they busily shape it to their advantage.
They are the kingpins of the new economy, and average Americans are
paying the price.”
What Reich refers to as “the new monopolists” are those
who have gained a degree of dominance in a market area by clever practices or development
of new technologies and methods, and used the profits from that dominance to
cement their market control, keep out competitors, and control prices. This is best done by integrating economic and
political initiatives.
Reich uses Monsanto as a company that has exhibited all
the behaviors of the new monopolies.
Monsanto developed a very effective general herbicide based on the
chemical glyphosate. It is the product
familiar to homeowners as Roundup. They
discovered that some plants had developed a resistance to Roundup. They figured out how this resistance was
generated and used this knowledge to engineer that tolerance into the genetic
makeup of corn and soy seeds. What they
could offer farmers then was a herbicide that could be widely sprayed,
including directly on the corn and soybean plants, without harming them.
“The herbicide and herbicide-resistant
seeds initially saved farmers time and money.
But the purchase came with a catch that would haunt them in the future:
The soy and corn that grow from these seeds don’t produce seeds of their
own. So every planting season, farmers
have to buy new seeds. In addition, if
the farmers have any seeds left over, they must agree not to save and replant
them in the future. In other words, once
hooked, farmers have little choice but to become permanent purchasers of
Monsanto seed. To insure its dominance, Monsanto
has prohibited seed dealers from stocking its competitors’ seeds and has bought
up most of the small remaining seed companies.”
“Monsanto….owns the key genetic
traits in more than 90 percent of the soybeans planted by farmers in the United
States and 80 percent of the corn.”
This clever strategy has paid off for Monsanto as the
dependence on Monsanto has continued, but farmers and consumers have been
forced to contribute excessive amounts of cash to the company’s coffers.
“The result has been higher
prices far beyond the cost-of-living rise.
Since 2001, Monsanto has more than doubled the price of corn and soybean
seeds. The average cost of planting one
acre of soybeans increased 325 percent between 1994 and 2011, and the price of
corn seed rose 259 percent.”
Monsanto has made good use of its teams of lawyers who
have been successful at protecting its advantage and imposing its license
agreements on farmers. However, what is
most insidious is the degree to which political control can be obtained.
“Monsanto has the distinction of
spending more on lobbying—nearly $7 million in 2013 alone—than any other big
agribusiness. And Monsanto’s former (and
future) employees frequently inhabit top posts at the Food and Drug Administration
and the Agriculture Department, they staff congressional committees that deal
with agricultural policy, and they become advisors to congressional leaders and
at the White House. Two Monsanto
lobbyists are former congressman Vic Fazio and former senator Blanche Lincoln. Even supreme Court justice Clarence Thomas was
at one time as attorney for Monsanto. Monsanto,
like any new monopoly, has strategically used its economic power to gain
political power and used its political power to entrench its market power.”
Reich presents two other issues that emerge from a single
company and its products becoming so dominant in agriculture.
“Another result has been a
radical decline in the genetic diversity of the seeds we depend on. This increases the risk that disease or
climate change might wipe out entire crops for years, if not forever. A third consequence has been the ubiquity of
genetically modified traits in our food chain.”
The latter issue of genetically modified food (GMOs) is
currently a hot-button issue. This
concern has taken the form of demands that producers be required to label
products containing GMOs. At present,
there seems to be no clear evidence that genetic modification has produced potentially
harmful products. Since most of the corn
and soybeans produced in this country have been genetically modified, any item
containing corn or soybean products would have to be labeled as containing
GMOs. So many things would fall in this
category that it is not clear what labeling would accomplish.
A more serious concern is related to the way in which
genetically-modified corn and soybeans are produced. The purpose of the genetic modifications is
to allow the food-producing crops to be doused in dangerous chemicals without
being killed. Who among us would go out
to their garden and spray Roundup on plants producing food we plan on
eating? It sounds a bit absurd—yet our
agricultural industry depends on doing just that.
When Monsanto provided its seed/herbicide duo it claimed
that it was providing a path to higher crop yields and the environmental
benefit of lower herbicide use. The data
indicates that higher crop yields have not been obtained. What the data
does indicate is that the use of herbicide—and Roundup in particular—has
exploded. From this source:
“American growers sprayed 280 million pounds of glyphosate on their crops
in 2012, according to U.S. Geological Survey data. That amounts to nearly a
pound of glyphosate for every person in the country.”
“The use of glyphosate on farmland has skyrocketed since the mid-1990s, when
biotech companies introduced genetically engineered crop varieties (often
called GMOs) that can withstand being blasted with glyphosate. Since then,
agricultural use of the herbicide has increased 16-fold.”
Monsanto was well-aware that plants could and would
develop a resistance to Roundup. These “superweeds”
have required that farmers use ever larger quantities of herbicides to try to
contain them. Monsanto’s business plan
seems to be to continue to develop new seeds and ever more powerful herbicides
as a combo. From this source:
“The U.S. Department of
Agriculture said this week (March 23 [2016]) it will allow farmers to plant a
new strain of genetically modified (GMO) corn created by Monsanto to be
tolerant of the weed killers dicamba and glufosinate without government
oversight, a step likely to expand the use of these chemical herbicides.”
Monsanto is not the only participant in this escalating
chemical warfare. Dow is trying to get approved a seed/herbicide combo called
Enlist Duo, utilizing a mixture of glyphosate and another herbicide,
2,4-D. This aroused concern and public
uproar because 2,4-D was a component of the notorious Agent Orange. From this source:
“In a stunning reversal, the
U.S. Environmental Protection Agency has retreated from its earlier decision to
let Dow AgroSciences market a new weed killer, branded Enlist Duo, which the
company designed to kill hardy weeds on fields of genetically engineered corn
and soybeans.”
Apparently Dow was not sharing everything it knew about
its herbicide.
“The Justice Department brief
filed yesterday advised the court that ‘EPA has learned that it did not have
all relevant information at the time it made its registration decision.
Specifically, Dow did not submit to EPA during the registration process the
extensive information relating to potential synergism….’”
Concern about this usage of herbicides was elevated a
year ago when the International Agency for Research on Cancer (IARC), part of
the World Health Organization (WHO), announced that glyphosate, the active
ingredient in Roundup was probably carcinogenic. Andrew Martin and Lydia Mulvany produced an article for Bloomberg Businessweek that
addressed the issue.
“It’s been a tough year for
glyphosate, the world’s most popular weedkiller. A year ago, the International
Agency for Research on Cancer (IARC), an arm of the World Health Organization,
declared that glyphosate—the key ingredient in Monsanto’s Roundup products—was
probably carcinogenic to humans. In the months since, multiple lawsuits have
been filed blaming the chemical for causing cancer and birth defects. In
February, testing found traces of glyphosate in German beer and organic panty
liners sold in France. Other tests have found chemical residue in British
bread, as well as in the urine of people across Europe. In early March, the
European Union put off a vote to renew a 15-year license for glyphosate after
several member states balked.”
“The FDA said in February that
it would begin testing for glyphosate residue in food in the U.S. The results
aren’t yet available.”
Monsanto is, of course, fighting back. They are making the argument that glyphosate
might be carcinogenic, but only doses so large that no one will ever encounter
them, therefore it should not be labeled a carcinogen.
That is a valid point to make, but it may be irrelevant. Toxicity
as a single event is different than toxicity from a lifetime of exposure to low
levels of a carcinogen. Consider this
comment on toxicity from Wikipedia.
“Assessing all aspects of the
toxicity of cancer-causing agents involves additional issues, since it is not
certain if there is a minimal effective dose for carcinogens, or whether the
risk is just too small to see. In addition, it is possible that a single cell
transformed into a cancer cell is all it takes to develop the full effect (the
"one hit" theory).”
“It is more difficult to
determine the toxicity of chemical mixtures than a pure chemical, because each
component displays its own toxicity, and components may interact to produce
enhanced or diminished effects.”
We end up carrying around in our bodies hundreds of industrial chemicals that we
encounter as we go about our business.
Most have never been assessed for toxicity in humans. Essentially, we do not have a clue what we
are doing to ourselves.
The never-ending escalation of the conflict between
plants and herbicides that Monsanto has foisted upon us is madness. It has not increased productivity and it may
be putting the world in danger. It is
time to revert to better agricultural practices.
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