The Rural Voice, 1988-08, Page 16COMPLETE LINE OF
ANIMAL FEED
— Hog
— Veal
— Dairy
— Beef
— Poultry
— Pet
treleaven's
feed mill ltd.
box 182, lucknow, ont. NOG 2H0
519.528.3000
1.800.265.3006
14 THE RURAL VOICE
THE PROFIT MOTIVE:
LET'S BE REALISTIC
Both the Christian Farmers Feder-
ation and the Rural Life Conference
have decried the profit motive in
agriculture. This profit philosophy,
they say, causes over -production and
such side effects as the deterioration
of soil quality, larger farms, and the
erosion of rural communities.
This stand doesn't make much
sense, as all of agriculture, for as long
as can be remembered, has wailed
about low profits.
Let's take a look at the alternatives
to the profit motive. One would be the
NFU ideal of quota systems. This, of
course, would have to include a maxi-
mum quota allowance in accordance
with what one family could produce.
As this is not acceptable in interna-
tional trade, it would mean foregoing
the 30 per cent of agricultural exports
we have now and producing only for
the domestic market. The exception
would be grains, as production limited
to domestic use would depopulate the
entire rural West.
The loss of export earnings, an
enormous part of total export income
for Canada, would lower our standard
of living severely.
What the critics of the profit
motive want to forget is that increases
in productivity have been going on
since the dawn of civilization. The
ancient Sumerians started when they
began building the first town. The
inhabitants of this town were not inter-
ested in growing crops. Instead they
made tools for the farmers in return
for food. This was a blessing for both,
as the resulting trade gave the city
people enough leisure to begin pro-
ducing art. The farmers could bring
more land under cultivation with their
new tools and had a ready market. In
other words, they increased their pro-
ductivity as they made more profits.
That process has not stopped. Any
farmer who does not become more
productive, be it in pigs per sow,
calves per herd, or bushels per acre,
inevitably goes broke. This is because
either his neighbour or his counterpart
in another country will out -price him
in the marketplace.
An example of what guaranteed
income leads to can be seen in the
U.S. manufacturing industry. High
Technology Magazine reports that the
U.S. government for years neglected
research and development (R & D).
Private industry was unable to keep up
with the Japanese, who did work with
their government in financing R & D.
Now some U.S. politicians, instead of
tackling the root cause, want protec-
tionist barriers so U.S. industries can
at least remain competitive internally.
Another results of the absence of
the profit motive is in the underdevel-
op.x1 world. There governments, in
too many cases, have decreed that all
surplus farm produce must be sold to
the government. The government sets
an arbitrary price that leaves no profit
for the farmer. The predictable result
is that the farmer doesn't produce a
surplus and the country must import
food that is too expensive from the
West. Then starvation sets in.
Fortunately, no Canadian
government, provincial or federal, has
accepted that attitude, and R and D in
agriculture, while still nothing to brag
about, is steadily increasing. All have
accepted the lesson of history — that
productivity must increase if we are to
remain even with our competitors.
Could it be that the CFFO and the
Rural Life people are too close to the
clergy? Clergymen don't have to
compete in the marketplace. For them
the profit motive doesn't exist and is
often even distasteful, as religious
history has shown — and as one can
see in Iran today.0
Adrian Vos, from Huron County, has
contributed to The Rural Voice since
its inception in 1975.