“Remember, markets are not ends in themselves.They are constructs to assist populations in achieving the optimum allocation of resources” (p. The age of Turbulance Allen Greenspan pg 461).
How can we create markets that allocate potential rainforest land to have trees and not cattle grass?
Yesterday went up and met with a lower land coffee group that is growing
arabica at 200 meters. They could probably make more growing robusta,
but they are into growing arabica and most of them travel to work in
Costa Rica picking coffee or someone in their family does, so they know how to manage it and feel comfertable working with it.
To get to their town, you have to hike for 12 km, about 7 miles, mostly through cattle pasture. One thing I found out today was that some
farmers rent out lots of cattle land for ten dollars a month, and have
to plant the grass and fix the fence posts for that rent.
What if they were to plant coffee? Im not sure what the amount of land
that they farmers are renting at $10 a month, but what would the
minimum amount of land you would need to make 10 a month break even
For the first three years, there maybe no harvest, but after that,
with robusta it seems feasible to get 1000 lbs a hectaria. If you can
get .80 a lb, that’s 800 a hectaria. So If it were 10 a hectaria, or
120 a year, you would have 680 to try to make it profitable.
Not including labor, you could make it work on about a 40 m by 40 m,
or about and acre.
It gets back to the quotation about creating markets to use resources
more effectively towards meeting the needs of population. Panama is
much better at producing rain forest than cattle, and this is much
better for the environment, in the long and short run.
Likewise, it gets into the internalised and externalised cost of
things. Hamburgers are cheap here, because there is cheap land to
produce it, because the costs are external to the price, and the total cost of ownership, or total cost of purchase, will be paid by everyone, not just the cattle farmer and . Converting the rain
forest in cattle lands into burgers into cash might be good in the short
run, but in the long run we all lose a lot.
This quotation here highlights the work needed to be done:
“The entrepreneur,” said the French economist J. B. Say around 1800, “shifts economic resources out of an area of lower and into an area of higher productivity and greater yield.”
Some how, the price of losing the rain forest has to be internalise to the burger, or the gain of having a coffee farm instead of a cattle farm has to be internalized into the cup of coffee.