Introduction to agricultural systems

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2.1.10 Reading: Spaceship Gaia (Ashworth, W. 1995. pp.83-88 in the Economy of Nature: Rethinking the connections between ecology and economics. Houghton Miflin Co., New York).
What new model shall we choose to replace the paradigm of the frontier? Three possibilities have been floated over the past several decades: the spaceship, the organism, and the household. None is fully satisfactory. I am about to propose a fourth; but first, let us take a close, critical look at the failed ones.

Credit for first conceiving of the Earth as a spaceship usually goes to the inventor and philosopher Buckminster Fuller, a tire­less and enthusiastic proponent of what is now called "alter­nate technology," who began using the paradigm in speeches at least as early as 1964. "I wish to point out vigorously to you that we are indeed aboard an 8,000-mile-diameter spheri­cal space vehicle," Fuller remarked to a Senate subcommittee in 1969.

Earth is a beautifully designed spaceship, equipped and pro­visioned to support and regenerate life aboard it for hundreds of millions of years.... [But] we are not going to be able to operate our spaceship Earth successfully nor for much longer unless we see it as a whole spaceship and our fate as common. It has to be everybody or nobody.

The spaceship image is powerful. It suggests at once vulner­ability, interdependence, and closure. Spaceships are small and fragile in the depths of space, prey to meteorites and radiation and able to support life only so long as they remain intact. They are thoroughly and completely interconnected systems, with every part necessary and every part dependent on the other parts to function properly, from the human pilots and their oxygen supply right down to the clips that hold the control consoles in their brackets. And they are also thor­oughly and completely closed systems. There is no running down to the corner store for something that has been forgot­ten: all you have is what you have carried with you from the launching pad. Everything must be either used over or used up. Crew members of a spacecraft do not recycle because it is politically correct to do so; they recycle because if they do not they will die.

All these qualities make the spaceship a far better paradigm than the frontier has ever been for modeling a dynamic soci­ety on a finite planet. It is, nonetheless, not entirely satisfac­tory. The primary problem lies in its technological, human-­constructed nature, which suggests that technology is the answer to environmental problems as well. Worse: it suggests that when things begin to go wrong, the proper course of action is to tinker with them. Both of these assumptions are correct for machines but dangerously misleading for the planet. Life is an evolved system, not a designed one, and it cannot be treated as though a quick look at the blueprints and a couple of bobby pins can cobble it up and make it run right again. There are too many connections, and they lead off in too many different directions, for us ever to be able to anticipate completely the results of what we do. In such a situation, tinkering is ill advised. Attempting to fix ecosystem problems with technology, the English biologist Charles Elton remarked a half century ago, is equivalent to attempting to fix a com­plex and delicately adjusted piece of machinery by flinging a crowbar into it. The vast leaps in technology since Elton's day have not really changed that assessment. The problem is not the limits of human ingenuity; it is the limits of human per­ceptions, especially our perceptions of time. A species geared to think of one hundred years as a long time simply cannot grasp the dynamics of a system geared to eons, a system for which a millennium is merely an eyeblink. Technology is a human creation, and it cannot escape human time. The space­ship paradigm is powerful and effective, but it is also funda­mentally flawed. We must look elsewhere.

The second paradigm, that of the organism, is a very an­cient one, reaching back to before the dawn of history, to a time when rocks had souls and the Earth was our mother. The scientific formulation of the paradigm begins with the eight­eenth-century Scottish naturalist dames Hutton, the "father of geology," who wrote of the planet as a "superorganism" that was best studied as a whole rather than as a collection of parts. In recent years the earth-as-organism idea has been stated as a formal hypothesis by the British ecologist James Lovelock, both in scientific papers and in a pair of popular books, Gaia (Oxford University Press, 1979) and The Ages of Gaia (Nor­ton, 1988). Lovelock and his followers teach that life itself creates the conditions necessary to maintain life; that the composition and stability of the atmosphere, the narrow tem­perature range at the surface of the Earth (compared with other planets in the solar system), the presence of sufficient stores of free water, and most other aspects of our planet's uniquely life-friendly environment have been developed and maintained through self-correcting negative-feedback loops that have evolved along with, and as a result of, the evolution of life, and function in the same way as the metabolic cycles and self-healing abilities of living things.

The organism paradigm shares with the spacecraft para­digm an emphasis on interconnectedness and closure: living things are comprehensively interconnected, interdependent sys­tems, and they are strongly self-contained, each within its own wall of skin, bark, or cell membrane. Organisms are vulner­able to harmCthey can in fact be killedCan attribute that, like the fragility of spacecraft, encourages careful use and preservation. And because they are evolved rather than con­structed systems, they avoid the spacecraft analogy's almost compulsive encouragement of technological fixes and tinkering. When living things are malfunctioningCthat is, illC the first impulse is to adjust the inputs rather than tinker with the mechanism. Surgery is reserved for extreme cases.

This emphasis on evolutionary rather than technological solutions makes the organism paradigm a considerable im­provement over that of the spacecraft as a model for humans' interactions with one another and with the planet. But the improvement brings its own set of problems.

Evolution works because organisms react to stimuli, alter­ing their behaviors and even their structures to conform to changes in the conditions around them. This gives life the ability both to heal itself and to adjust to pathological condi­tions. And this, in turn, allowsCeven encouragesCa re­laxation of vigilance. If the planet can heal itself, why should we worry about it? It is a telling commentary on the useful­ness of the Gaia hypothesis as an environmental tool that among its strongest proponents are industrialists, developers, and others for whom life's capacity to adjust has become an excuse to avoid making any adjustments themselvesCand who remain blissfully oblivious to the fact that life's adjust­ment to the irritation provided by the human race may simply be to get rid of the irritant. The easiest way for the planet to address the imbalance caused by one particular species run­ning amok is to eliminate that one particular species. Gaia will almost certainly survive, but there is nothing in the proc­ess that guarantees that humanity is going to survive along with her.

The third alternate paradigm, that of the household, has one emphatic advantage over the spaceship and organism models: it is already in widespread use. The metaphors that allow us to speak of it have not required invention by a Fuller or a Lovelock: they are already deeply embedded in the lan­guage. The terms ecology and economics, with their deriva­tion from the Greek word meaning "household," are only one example of this; we also speak regularly of the "family of man," of "homelands" and the "home planet," of the "foundations of society," of "brotherhood," of "our animal kin." We slip easily into these images, we are comfortable with them. Few, if any, will deny their validityCa situation that is simply not true of either Gaia or Spaceship Earth.

To use the word household in this manner is to imply relationships. People in a household interact regularly. They talk to one another; they provide for one another. They affect one another's actions. There may be cooperation or there may be conflict; there may be love or there may be hate; there may be ties of blood or ties of affection or merely ties of pragma­tism, two people living as roommates because it is cheaper and easier to live that way. What there is not is atomistic individuality. People living together, like planets, affect one another's orbits. You cannot live alone and as a member of a household at the same time.

Thus the household paradigm, like the spacecraft and or­ganism models, implies connections. It also implies closure (the four walls of the house) and vulnerability to tampering (burglary, fire, electrical malfunctions). At the same time, it avoids most of the pitfalls of the other two frameworks. No one has ever suggested that a household is a self-correcting entity that will run itself without attention, or that it is all right not to worry about burning the place down if someone insists on playing with matches. And while there must always be access to a good plumber, no one counts on technology and tinkering to keep the human relationships the household depends upon functioning properly. We understand that these require, not the attentions of a mechanic or a handyman, but nurturing and care and love.

But this great strength of the household paradigm is also its principal weakness. It is human centered; it places the other parts of the household in supporting roles. And we simply cannot afford to do that anymore.

Copernicus took us out of the center of the solar system; we now need to take ourselves out of the center of the bio­sphere as well. We are not the focus of a spacecraft's support systems, or the brain and nervous system of a world being, or even the head of the planetary family. We are a functioning part of an ecosystem, one out of many, neither above nor below any of the others. And that is precisely the way we must begin thinking of ourselves. The paradigm we must now adopt is that of the ecosystem. We need to learn to think not like a household but like a forest.

2.2 Economic and social systems (Reading 6. Vogt and Dolan, 1988, Chapter 2)

People live in economic and social systems - human communities. All people face the same socio-economic decisions every day: with limited time, and limited available resources and technology, people have to decide what to eat, what to use as clothing, what to use for shelter. Usually one decision precludes another, i.e., if you catch fish to eat one day, you cannot also hunt for deer; if you buy a new car, you cannot also buy a new house, if you build a pig barn, you may not have enough money and labour to also build a dairy, etc.

Economic systems are partly based on the idea of ownership. They differ based on questions of ownership, which implies the right to use something and to prevent others from using it. Owners can make decisions, especially economic decisions, and business owners can make decisions about production.

In Canada, the dominant economic system is capitalism. Most firms are owned by people who put up the capital (money) to start them (proprietors, partners, shareholders), although some firms are collectively owned (mutual insurance companies, credit unions, agricultural and consumer cooperatives, private colleges, etc.) or government owned (Canada Post, SaskTel). Systems based mainly on government or social ownership are called socialism. All existing systems in the real world are mixtures of capitalist and socialist systems - in Canada, US, Western Europe and Japan, capitalism prevails; in Russia, and China, social ownership prevails.

In the capitalist system, owners of capital are managers and entrepreneurs. Under mutual and cooperative ownership, managers are chosen by workers or consumers, whereas under socialism with government ownership, managers are public employees.

A modern economy - circular flow. Socio-economic systems are most often shown in economic text books as firms and households, with capital and labour exchanged between them. Figure 2-1 shows a simple two-sector economy with households purchasing everything produced by firms, using all of their income to do so, and providing all of the labour and resources that firms require for production. This very simple depiction of the economy does not show how human systems and natural systems are related.
2.2.1 Resource scarcity and economic problems

Figure 2-2 shows the production possibility frontier (ppf) of a simple economy - the ppf shows what consumers can have in a given period of time, with time as a scarce resource. High quality water could also be considered a scarce resource. Consumers can chose between water for drinking or water for irrigation, but it cannot be used for both at the same time.

The production possibility frontier shows points of efficiency, beyond which resources could not be used more efficiently. Changes in resources, technology, or human skills will change the PPF, causing it to move up or down. Given that resources are scarce, and if used for one purpose are not available for another purpose, economists consider four basic questions:

1. What should be produced, given limited labour, capital and resources? Cars, bread, tanks?

2. How should goods and services be produced? In factories, in small businesses, cooperatively?

3. Who should produce goods? Should duram wheat be grown in Saskatchewan and pasta made in the east? Should most executives be men and the secretaries women?

4. For whom should the goods and services be produced? For people with most money, or greatest need?

What to produce is described by the PPF, but how to produce is decided by determining how much capital and how much labour are available. Labour and capital can be substituted, i.e., rice production in Indonesia requires much labour on small plots, whereas in California rice is grown with little labour in large fields under highly mechanized conditions. Rice production in Indonesia is labour-intensive, in California it is capital-intensive.

Who does the producing? Regional differences in resources and the labour force often determine the type of production in an area. The Prairies are suited to grain production whereas B.C. is suited to logging because of the natural environments of both places.

For whom to produce? In pure market systems, goods are produced for those with the most purchasing power in the market, i.e., those with the most money or highest incomes. This is considered fair if income differences reflect the contributions that each household makes to the economy. If goods are distributed in a way that rewards hard work and careful use of resources, there will be more goods to be distributed. But, is distribution or production of the most goods the best choice for society? In pure markets systems, rich people have more votes (capital) about what to produce and get more of it than poor people. These economies may be operating efficiently (on the PPF), but the goods that are produced may not meet the needs of large numbers of poor people, i.e., military or luxury goods versus basic consumer goods.

Because of these problems, most governments interfere with the market to alter the distribution of goods, and to ensure that basic needs are produced for those with little purchasing power. For example, subsidy payments were made to farmers when wheat prices were low because of a world trade war in grains. The payments ensured that the basic needs of farm families are met.

2.2.2 Causes of environmental damage in human systems: economic considerations

Figure 2-3 shows the ideal relationship between population, food demand, supply and price (Watt, 1982. p. 157). In the ideal world, one set of factors regulates the size of the population (1), another set regulates per capita demand (2). Population (3) times per capita demand (4) equals total demand (5). The resultant demand (6) together with total supply (7) produce a ratio of demand to supply, and as the ratio increases, so does price (8). Price (with a lag) has three effects:

  1. it can cause increased supply (more production due to good price (10)

  2. it can cause reduced demand (12)

  3. it can result in negative feedback to reduce population if food is to costly (11)

However, the world is not ideal, and environmental interactions often not considered (Figure 2-4, Pearce and Turner, 1990, p. 35). The result is that the system appears to be linear. Adding resources to the model to show that production requires the input of resource materials, but the system still appears to be linear.

Wastes, which arise at every stage of production must also be accounted for (Figure 2-5). The processing of resources creates wastes (tailings, overburden at coal mines), production creates industrial effluent and air pollution and solid waste, and consumers create wastes by generating sewage, litter and municipal refuse. Since everything must go somewhere (first law of thermodynamics: matter cannot be destroyed), the amount of waste produced is equal to the amount of natural resources used up. Therefore, the relationship cannot be linear and the waste does not disappear, but must be an input to something else. The earth is a closed system, with the economy and the environment joined by circular linkages. Because the earth is a closed system, wastes cannot be disposed of and the economy cannot be organized simply as the linear input of resources to produce output to achieve utility.

There are two types of resources: renewable (forest, fish, wheat, soil organic matter, clean water) and nonrenewable except in the very long-term (oil, coal, minerals). The rate of renewal of renewable resources varies ( i.e. wheat field -every year, forest - 80 years), so the harvest rate, or rate at which the resource is used must be less than the renewal rate if the resource is not to be depleted, its sustainable yield.

Figure 2-6 (Pearce and Turner, 1990, p. 40) shows the whole circular economy, where A= assimilative capacity. If wastes exceed the assimilative capacity, there is negative feedback, both to the resource base (i.e. crop yields decline as soil organic matter levels decline) and to utility (i.e. poor environmental quality (air and water) reduce the quality of life). Three economic functions of the environment are shown in Figure 2-6:

  1. supplier of resources (nutrients, pasture),

  2. waste assimilator (nitrate, CO2, pesticide residues),

  1. direct source of utility (healthy food, scenic country side)

They are economic functions because they all have a positive economic value. They would all have a positive price if we bought them in the market place. We tend to mistreat natural environments and resources because we do not recognise the positive prices of their economic functions. This may occur because they are non-market goods or services which the environment provides, which means we do not have to purchase them. As a society, we tend to measure value by how much a good or service costs in the market place. Since environmental services are free, we do not know how the assess their value, and tend to treat them as without value.
2.3.3 Valuation of Natural Resources - an economic and environmental problem

Systems of National Accounts (Repetto et al., 1989) National accounts were started in the U.S. in 1942 to provide an information framework for analysing the performance of the economic system. They were based mainly on consumption, savings, investment and government expenditures, because Keynesian economists were concerned mainly with how an economy could remain for long time periods at less than full employment. A scarcity of natural resources in the long-term was not even considered.

Nineteenth century neo-classical economics, on which most contemporary economic theories are based, were not concerned about resource scarcity. From the time of the industrial revolution, economists concentrated on the pace of investment and technological change. Whereas previously, classical economists had regarded income as the return on natural resources, human resources, and invested capital (land, labour and capital - which were important during the agricultural revolution), neo-classical economists concentrated on labour and invested capital, which they were important to the industrialization process. After World War 2, labour was often considered surplus and development was based on savings and investment in physical capital (machines and factories). Because of this, man-made assets, such as buildings, equipment, and sawmills are valued as productive capital that depreciate in value over time. However, natural resources are not so valued, and in fact, all of the forests of a country could be cut down, but the country would appear wealthier because the timber and sawmills have more market value than the forest. This occurs because it was assumed that natural resources were so abundant compared to human-made resources that they had no marginal value.

However, we know now that as trees, or clean water, or soil organic matter become less common, they do have marginal value. For example, soils depreciate as their fertility is diminished, since nutrient poor soils can produce only at higher costs (use of fertilizer) or lower yields. Because soil organic matter has no market value by itself, it can be used up without its loss being valued in macro-economic systems. Since the cost of using up the resource is not calculated it tends to be used up to finance economic growth, i.e., farmers get rich now by using soil nutrients for crop production, but what about future farmers? Their costs of production will be higher because they will have to replace the nutrients that have been exported in the past.

Time preference. The problems of valuing natural resources is partly a time preference problem. Consider your reaction if you are given the option of preparing a 10 page paper due next week, or a 25 page paper due at the end of the term, with both papers worth 25%. How many would prefer to hand in the paper next week, how many at the end of term? Assume that for students, time is scarce. You can use time now to write the paper, or you can use time now for other things, and use more time to do the paper, but at a later date. Do you value your time more now or in the future? Time preference will vary among students. Those with a lot of work now, will value their time now very highly, those who are only taking two courses may value their time now comparatively less and will opt to spent one week now rather than two weeks later doing the paper.

If we assume that natural resources are as scarce as your time, the time preference situation is the same. A farmer can decide to add legumes to her rotation to conserve organic matter and nutrients now, even though that results in reduced income. Another farmer can decide to maximize grain production, and therefore maximize income now and worry about the loss in future yields from reduced soil fertility in the furture, even though the reduction in yield may be much larger in the future, and the cost of maintaining yields very high. This farmers= current production is being achieved at the expense of future output. The choice depends on how much each farmer values current production, and that may depend on:

  1. Knowledge - do we know that we are jeopardizing the future by using resources at too high a rate today,
  2. Need or financial circumstances - how much do we need income today to stay in business, especially if we are in competition with other farmers who are maximizing production now. The cost of using up soil organic matter is not built into current production costs, those costs will all be paid in the future, so the cost of production does not reflect depreciating soil fertility. Soil is assumed to be worth the same after producing 80 crops as after producing 20 crops.

  3. How future generations are valued. If we want the children and grandchildren of future generations to have the same quality of life that we have, we may be willing to do with less now, so there is more for future generations.

  4. Faith in science and technology. Some people believe that we can use science and engineering to solve future resource problems. If soils become so degraded and unproductive that they cannot be used economically to produce food, we will grow food hydroponically, or we will eat bacterial cultures, etc. The way in which Alberta=s oil and gas is valued depends partly on this idea. Currently Alberta produces oil and gas at a profit that feeds the Heritage Fund, but maybe, as oil and gas become more scarce, their value will increase markedly, so that in the long-term Alberta would have been better off to leave those resources in the ground and reap the windfall profits later. But what if technologies based on solar energy are developed as oil and gas become scarce and expensive, and oil and gas are worthless once solar energy technology is common?

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