Beyond Occupation: Recognizing the Limits to Economies of Scale

Posted by Liz on October 19, 2011

By Stacy Miller, Executive Director

Last week, I had the privilege of participating in the James Beard Foundation Food Conference, ‘How Money and the Media Influence the Way America Eats.’  In the heart of Manhattan, overlooking Times Square, I found myself amidst discussions about the interplay of power and profit at every point in the food system- and the often adverse consequences to our health.

On a panel of economists, Jeff Madrick, author of Age of Greed, rightly pointed out that agricultural economies of scale, driven by the mythology of efficiency, ultimately reduce choice to the consumer. Similarly, it limits diversity on the farm, subtracting from the bottom line of natural capital. While the concept of efficiency (on which so much of profit is based) is appealing in the abstract, a single-minded attention to it, in the field or the factory, eventually results in exploitation and monotony—of people, soil,  water, air, food, and community fabric.

Efficiency is defined by ratios of often arbitrary numerators (eg. units of output) and denominators (eg. the resource required to generate the output).  As Thomas Princen notes in his book The Logic of Sufficiency (a tattered copy of which my colleague and friend Darlene Wolnik shared with me two years ago), two-element ratios created to measure efficiency (miles per gallon, yield per acre, sales per square foot) are rarely adequate, because they don’t take time, or the externalized costs of the denominators, into account.  Simplifying a system’s variables through such a limited lens gives power to whoever selects the two variables in a given ratio. We rarely use the term efficiency to describe the ability of high fructose corn syrup (input) to generate cases of Type II diabetes (output), but it’s the same principle, and a phenomenon of the same broken system.

I asked the panel what kinds ratios they thought might more accurately reflect success in systems that create (rather than exploit) social, physical, economic, and ecological health.  I probably should have known better than to expect a concise response, so I spent the rest of the week trying to find some answers.

First, I made some time to head south and check out the Occupy Wall Street demonstrators in Zuccotti Park, directly across from ground zero. That same day, Siena Chrisman wrote a piece on Civil Eats about the connection between their efforts and the food movement.  The irony that she didn’t point out was that the park is home to a farmers market on Tuesdays, which relocated earlier that week after the 24 hour demonstration was confined to one spot.  While this surely meant some headache to both the farmers and Greenmarket staff, it was possible because the market, like thousands of its open-air kin around the country, can be adaptive when they need to be, preserving the multi-use function of public spaces.

After we occupy Wall Street, will we have what it takes to walk away from it? Where do we  invest in alternatives that take concentrated power from the hands of the few and reinstate it into the hands of the many?  I hope you’ll agree that the answer is not only farmers markets, but credit unions and locally-owned independent businesses that you’ll never see with a NASDAQ ticker symbol.  I’ve been heartened by the work of Stacy Mitchell, whose Localism Index is an inspiration for farmers markets to partner with other buy local and buy independent campaigns.

What farmers markets uniquely model is the notion of coopetition, in which producers come together in a common space and, as a side effect, inspire one another to innovate, diversify, and excel in a supportive environment where the “rules of the road” are transparent and mutually agreed upon. It’s in this kind of environment that agricultural entrepreneurs can carve out niches for themselves (niches which are not necessarily dependent on either single-product specialization or an evolution to larger and larger scale), grow their business skills, and get real-time feedback from customers. With so much in the national economy based on speculation, and so many of our purchases seeming to disappear into the black hole of a corporate logo, this means something.

Which brings me to another serendipitous aspect of my trip to New York. With most hotel rates in New York City beyond the scope of reason for an organization like ours, I heard about and took advantage of a service called airbnb (props again go to Darlene Wolnik for trying it out before referring me). Through it, I was able to find and book a room in a small apartment from a young social service worker (who, it turned out, was a regular farmers market shopper, and her kitchen counter was proof of recent visits).  It felt especially timely to find a way for FMC’s money to support a person rather than a brand name.  In this sense, the transaction was an efficient (and affordable) investment in Brooklyn—in its farmers markets, used bookstores, cafés, and other independent shops.

The notion that we need human scaled economies is nothing new.  Herman Daly, E.F. Schumacher, Bill McKibben, and many others have written and spoken about it for years, and the newer Slow Money movement is also pushing conversation in a good direction.  In fact, while I was in New York, FMC President Sharon Yeago was at their conference in California, engaged in parallel conversations.  Who could argue with the notion that a living wage for farmers and farm workers is more important, and more fair, than banking industry bailouts and million dollar bonuses?

In case it wasn’t obvious, you are part of the solution, giving Americans a tangible way to put people over profits.  Let’s not take this responsibility lightly.  Never has the triple bottom line of farmers, consumers, and communities had more resonance as part of an economy that works for all of us in the 99%. Don’t neglect the opportunity to quantify your triple bottom line successes, because measurement matters.  But we cannot let our ratios be defined by numerators and denominators someone else has chosen.  Together, we can move past the notion that efficiency is dependent on economies of scale, to define (and improve on) our effectiveness, our diversity, and our sustainability over time.

In closing, I want to thank you for reading this Autumn 2011 issue of the market beet.  If you’re not a member, please consider becoming one today.  Like the independent hardware store, the farmers market, and the local baker, FMC does not exist without your support.   And if you needed a better reason, how’s this?–  the November 10th member webinar, Markets as Business Incubators: Strategies to Grow Your Vendor Base can help markets grow their product diversity per square foot.  And that’s a ratio to be proud of.