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THE MANAGEMENT MODEL AND CO-OPETITION
This essay appeared in the Whatcom Independent on March 13, 2008. It is no longer available online because the paper folded. (The Indy was ahead of the curve, as usual.)
Per Cochrane, what an early adopter of technological or biological improvements gains is soon swallowed up as his neighbors also adopt the improved techniques. This drives prices down. If the government adopts fixed price supports to keep prices up, increased demand for more acreage drives land prices up. Then the farmer is back on the treadmill. What usually happens on the treadmill is the farmer is forced to increase production units so that volume makes up for decreased profits per unit. This is the origin of the famous saying, “Get big or get out.” What Cochrane advises to escape from the treadmill is a “skillful combination of resources and technologies by management (Ibid, p.435).” Simply put, a good manager will use what is available and put multiple resources together to stay ahead of the game. For example, something as simple as using accounting spreadsheets to track production units can be a powerful tool and just as important as a fuel-efficient implement.
All well and good, you may say, but how can I make use of a different model? A simple way to do this is change from zero-sum thinking to win-win thinking. The zero-sum view says that if someone wins, someone has to lose. The win-win view, however, says we can all win. Now this makes sense to me simply because, as farmers, we are creating new wealth on a daily basis by producing calories in the form of food. One practical way to utilize win-win thinking is through “co-opetition,” rather than competition. Co-opetition is simply a new word that is an amalgam of cooperation and competition. I can’t take credit for it, but I certainly like the term. How it works in my little operation is quite simple. I compete with my neighbors in selling vegetables, whether through a farmer’s market, on–farm sales, restaurant sales, or through Community Supported Agriculture (CSA) share programs. Yet we share knowledge, do cooperative seed-ordering, help each other with work and refer customers to each other. Even though we compete for customers, we also cooperate, thus the term “co-opetition.”
It seems to me that co-opetition is simply good management and thus part of the management model. However, once we engage in co-opetition on a direct-marketing level, we run into an old problem, protecting the “niche.” This is a problem I often see with farmers’ markets, whose members are sometimes worried about too many farmers for the amount of foot traffic in the market. Another worry is too many markets for a region, diluting the amount of customers available for each market. However, I don’t see this as a valid concern, especially as I look at the growth of population, growth of organic/natural demand, increase in transportation costs and media buzz about small, local farms. To my mind, the management model offers farmers a way off the treadmill, with co-opetition a distinctly better world view than competition.
This essay was submitted to the Cascadia Weekly in November, 2008 but never published. Perhaps it is not good enough. You be the judge.
Modern agriculture is in trouble. The general economic downturn hits farmers with a double whammy because petrol is used not only for fuel but for chemical fertilizers and pesticides. Mechanization and increased chemical fertilizers have certainly allowed fewer farmers to farm more land and grow more food, but this is all based on massive quantities of cheap oil. Modern farmers must compete with other industries for their petroleum-based inputs, while the prices for their food outputs have to compete with imports from other countries. This phenomenon of “paid in pennies and billed in dollars” squeezes farmers from both ends of the price spectrum and they must increase volume to make up for lower net profits per unit, whether it be gallons of milk, bushels of corn, or pounds of produce. Thus the origin of the famous quote from Ezra Taft Benson, Secretary of Agriculture under President Eisenhower, “Get big or get out.”
As if the farmer’s life is not tough enough, now there is a new wrinkle in the up-and-down economic cycle called peak oil. Peak oil is simply the point in time when the maximum rate of petroleum production is reached, after which the rate of production declines. Some of the peak oil gurus are now saying we actually reached global peak oil production in July of this year. In the coming years we might not be able to continue getting enough oil from foreign countries, even if we are willing to pay a much higher price. This means an industrial agriculture based on cheap oil is doomed. The question then becomes, “How can we adapt?” Taking a page from academia and a definition of modernism as an interconnected grand narrative, let’s look at postmodern agriculture.
Modern agriculture has been sold to us as a story of how things work in an efficient market-driven world. We are constantly told, via print media, TV, radio, and in our schools, that we have the best agricultural system in the world, with the best food at the lowest prices. We are told that we feed the world. Most of this is just bull and can be easily refuted with a little internet research. The reality is we are just consuming huge amounts of petroleum in a different form. Since we consume 10 calories of petroleum for each calorie we produce in modern industrial agriculture, our soil has become just another factory where petroleum products from all over the world, capital, seeds, water and labor flow into the factory and food products come out the other end. Then the corporations add value to the food by processing and packaging, so that a box of cornflakes retails for multiple dollars, but contains only pennies of corn. We should not be surprised this is not sustainable in a post-peak oil world. So, if we need to find a different way to grow our food, we can start by deconstructing modern agriculture, breaking down the grand narrative, and look at simpler ways to solve our food problems.
We can start with simple questions. Do we need rows upon rows of multiple varieties of cornflakes and other breakfast cereals? Of course not – we just need food. Do we need to drive big tractors that consume huge amounts of fuel? Of course not – we just need food. Do we need Happy Meals? Of course not – we just need food. Once we reject the grand narrative that we have to have industrial food that comes in a highly processed form, we can look at what we already have for an energy source and what simple things we can eat. What we have is plenty of human labor available and a wide diversity of foods that are underutilized.
Sustainable agriculture is based upon human labor working in concert with biological processes. Even though some fossil fuels are used to power tillers and tractors, the quantities are much reduced in scale. Cover crops and other organic methods are used to maintain and increase soil fertility. The emphasis is on building the soil, so that plants can utilize the nutrients they need to be healthy and produce healthy food. This is quite different from the industrial agricultural focus on soil as a factory, monocrops, yield and large-scale efficiencies based on mechanization. Even the concept of efficiencies is part of the grand narrative, a story told to us without using a metric that can cross multiple platforms. In sustainable agriculture, the calorie is used to measure work in and work out. Humans are quite efficient machines – we can do a tremendous amount of work on very little caloric input – much better than horses even. It is easy to calculate the amount of calories used to produce food by human labor and the usual number given is 10 calories produced from 1 calorie of human work. In comparison to industrial agriculture, sustainable agriculture is 100 times more efficient (10:1 vs. 1:10). Sustainable agriculture is built on a human scale, uses calorie-efficient human labor and small amounts of fossil fuels when necessary, produces healthier food and does not require vast amounts of farm land to produce industrial monocrops such as corn and soybeans. In the coming post-peak oil world, it is a postmodern approach to agriculture that actually holds out hope to feed people. Modern agriculture will not be able to do the job. Postmodern agriculture will.