THE RECORD
June 07, 2000

Fiat Lux

by Ed Deak

Just about every time we open up a paper or switch on a radio or TV, there'll be some announcements, or demands by corporate controlled politicians for massive restructuring of the economy, downsizing, privatizing and cutbacks. The excuses usually are "to become more efficient, cut costs and prices to maintain our competitive position in the global marketplace." Well, the Harris government in Ontario did a good hatchet job on their health inspectors by privatizing the system and firing 40 percent of them. Just ask the people of Walkerton. They'll sing the praises of privatization.

The amazing, or rather the tragic thing is that a good many people still believe in this nonsense and in the politicians who sell it to the public.

The simple fact is that all forms of competition cost more than no competition, or co-operation. The physical inputs into competitive systems are working on the same principles as the laws of speed. This means that even small increases require very large increases in energy inputs. For example, most healthy people of any age can easily walk a mile. To run the same mile would eliminate the majority as the energy inputs dramatically increase. To run it competitively remains the privilege of a very few and the energy inputs into training and competition are literally astronomical. Anybody who claims that competition will lower costs is either a liar or a nutcase, because it is against the laws of physics and no economist, or politician can overrule them. Not even Mike Harris, Ralph Klein or Gordon Campbell.

I wrote a few weeks ago that the definition of economic efficiency was wrong because it claimed that the lowest monetary inputs into a product bringing the largest monetary returns is the greatest efficiency. This definition is irresponsible nonsense because both the monetary investment and the profits realized can be fraudulently distorted to suit the purposes of certain sectors. Monetary figures do not represent realities, only temporary perceptions that can be induced artificially, even criminally, or simply by the vagaries of the bidding system.

How many people would be willing to work without knowing what the payment is going to be at the end of the day? Well, we farmers are doing it every day of the year, sometimes through whole lifetimes. The prices we receive for our products have nothing to do with realities other than the results of often crooked games within the system.

Here's a very good example of how an why money based economic efficiency is not only not working, but how it is being used to distort real values. Last Sept. 23 I took two yearling calves to the auction. The prices reported in the paper were very good and based on the average I was hoping to get up to around $1,600 for them. I received just over $1,200. It was poor, but at the same time identical animals sold for $4-500 more. Two weeks later I took two identical animals and although prices were even higher, I received just over $900, or $6-700 below the price of identical calves.

There was nothing wrong with my animals. They were top quality. The problem is the system. There are three or four major buyers at these sales for large feedlots and companies. The system is set up to sell the cattle of large producers first so that these buyers can get their numbers fast and then take off. The animals of small producers are left last, sometimes till late in the night, when there are no more buyers around and we get nothing for our work. This is called "free enterprise."

According to neoclassical capitalist theory the large producers are therefore "efficient" and we the small ones aren't? This situation is not restricted only to farming, but to all kinds of production, where a few large operators can use the system not only to enrich themselves, but to transfer the real costs on to others and play the role of gods over who can survive and who can not. The interesting contradiction is that while it is claimed that large producers can turn out the goods so called "cheaper" they are the ones who get the highest prices.

The idea and purpose of democracy is that everybody is equal before the law and that everbody has the same right to live, work and survive in relative personal freedom. This should apply to the so called "marketplace", but instead it is just a killing ground.Copyright (c) 2000, West's International