Saturday, 24 March 2012

Doping Pigs and the Tragedy of the Commons

A lawsuit brought by some environmental groups (not my favorite ones) has seemed to force the U.S. Food and Drug Administration to finish up what it started doing 35 years ago, but cowering from a bullying livestock industry, never did. What FDA started to do 35 years ago Was study whether it should ban the use of penicillin and tetracycline to promote growth in agricultural animals. What scientists commonly believe is that reckless use of antibiotics by the agricultural industry has helped breed new generations of super, antibiotic-resistant bugs. The World Health Organization reports that about 440,000 new cases emerge each year of anti-microbial resistance to treatment; 150,000 eventually die. The evidence once might have been considered sketchy; not any more. The ag lobby is delusional when it claims there is no link. 80 percent of all antibiotic use in the U.S. is for agricultural use. A causal link between agricultural use and anti-microbial resistance is now widely-accepted by scientists.

What is tragic about this spiral of abuse and death? Surely the death of 150,000 people every year from a characteristically reckless livestock industry is tragic. But what is also comically tragic is that the livestock industry doesn't really benefit in the long run from being on this accelerating antibiotic treadmill. Because of increased resistance to antibiotics, livestock farmers find themselves having to race to keep pace with the superbugs. They have to administer more antibiotics and more sophisticated antibiotics in the vain hope that their pharmaceutical patrons can stay ahead of the superbugs. In fact, the increased cost of antibiotic use, in some cases, outweigh the growth-enhancing benefits.

So why do livestock farmers do it? They have to just to keep competitive. Like doping professional bicycle racers, like doping baseball players, livestock farmers are stuck. They are stuck because if they refrain, their individual forbearance will do no good, and they will lose money. Because everyone is doing it, no one benefits by stopping, even though everyone would benefit if everyone stopped. That is what is truly a tragedy of the commons: where those stuck in the rat race are all collectively working tomtheir collective detriment. In this case, there is also the matter of 150,000 people dying each year.

Thursday, 15 March 2012

Alberta's Water Markets: No Foreign-backed Eco-radicals Need Apply

By Tim Syer and Shi-Ling Hsu

Alberta is home to Canada’s only market for water licenses. Canada is generally abundant in fresh water, so perhaps it stands to reason that a lack of scarcity would obviate the need for water markets to serve an allocation role. In parts of Canada, however, water is scarce, as in the heavily populated (for Canada) and heavily agricultural South Saskatchewan River Basin (SSRB) of Alberta.

In 2006 the government of Alberta ceased issuing new water licenses and in accordance with the Approved Water Management Plan for the SSRB, it capped the amount of water allocated from SSRB rivers and allowed the trading of water licenses. Like other water markets, the government retains a number of controls over water trades, reserving the right to reject water transfers on environmental grounds, for example.

The puzzling part of the SSRB water market is, however, a limitation that water licenses purchased for "instream flow" purposes are limited to a cumulative maximum of 2% of all water allocated, provided that the minimum amount of "protected water" – the amount of flow that is deemed to be the minimally acceptable environmental amount -- has already been set aside. Why should there be such a limit? Is Alberta afraid of foreign-backed eco-radicals muscling in and buying up water rights?

The argument is that water is a resource that should be used to support economic growth. We see this bias towards consumptive uses in other resource laws – the use-it-or-lose-it nature of mineral licences, for example, reflect the assumption that resources are put to their highest and best use in consumptive uses, rather than passive environmental or ecological ones. But how do we know this without a truly free market to test that assumption? So what if Ted Turner bought up a huge block of water rights to thwart Alberta agriculture (Turner owns many ranches himself)? Is Alberta so afraid that its use of water is so unvaluable that it could not compete with the likes of Ted Turner's eco-radicalism? If so, that should tell us something. But even if we don't want to hear it, by retaining ultimate approval for all water allocations and transfers, the government can surely keep foreign interest at bay for the foreseeable future.