Wednesday, 5 January 2011

Locail

Here’s a pretty devastating critique of the concept of “local food”, which has many parallels with the “Locale” enthusiastically championed by CAMRA. The article clearly shows that promoting local food for its own sake violates the core economic principle of comparative advantage and does not actually deliver any tangible benefits in terms of assisting the local economy or improving the environment. By all means eat local food and drink local beer if you actually prefer it, but if you’re just doing it out of a sense of duty you’re effectively burning money.

Tom Vilsack, the current (US) Secretary of Agriculture, stated, “In a perfect world, everything that was sold, everything that was purchased and consumed would be local, so the economy would receive the benefit of that.” Apparently Vilsack believes that we'd be richer if we made our own shoes, iPods, and corn. Adam Smith and David Ricardo must be rolling in their graves.

Local food is generally more expensive than non-local food of the same quality. If that were not so, there would be no need to exhort people to “buy local.” However, we are told that spending a dollar for a locally produced tomato keeps the dollar circulating locally, stimulating the local economy. But, if local and non-local foods are of the same quality, but local goods are more expensive, then buying local food is like burning dollar bills – dollar bills that could have been put to more productive use. The community does not benefit when we pay more for a local tomato instead of an identical non-local tomato because the savings realized from buying non-local tomatoes could have been used to purchase other things. Asking us to purchase local food is asking us to give up things we otherwise could have enjoyed – the very definition of wealth destruction.
There is a point in pubs promoting local beers as a means of emphasising an area’s distinctive character – after all, you wouldn’t want to go on holiday to Cornwall and find Holts as a guest beer. It has to be said also that, once you get beyond meeting the needs of subsistence, preference in food and drink is essentially subjective anyway. But nobody should delude themselves that drinking local beers is in any objective sense “doing good”.

It always seems to me that there is also a strong element of snobbery involved in Locale, that it’s OK for me as a discerning world beer aficionado to drink Orkney Red McGregor or Cooper’s Sparkling Ale, but you lager-swilling plebs are bad people for drinking Magor-brewed Stella rather than Scrodgin’s Old Gutrot from a shed down the road. And all the arguing over the precise definition of “Locale” you see in CAMRA circles really is on a par with Mediaeval theologians debating how many angels can fit on a pinhead.

19 comments:

  1. I understand what he is saying in the article, although he writes from a very right wing, free market perspective. One of the points of LocAle is to try to break into the closed market of the PubCo tie, which as a form of protectionism is contrary to free market principles. I doubt the writer would approve of such protectionism.

    I'd therefore say that whatever he writes is not applicable to LocAle which, behind the various reasons CAMRA gives, has as its main aim to break into a monolopolistic form of business and allow small brewers access to its closed market.

    ReplyDelete
  2. I can't say I've ever noticed 'locales' actually costing any . more

    ReplyDelete
  3. What Ed said. Also to address the quoted articles point about local food, I buy locally because it's both cheaper and better quality than my local supermarkets. But then I do live within walking distance of a farm shop, with fishmonger and butcher that drive up twice a week - which may not be quite the situation they had in mind.

    ReplyDelete
  4. I'm not persuaded by this argument, even granting the premise.

    Let's say I can get the meat I want for tonight's tea for £3 at LocalButcher and for £2 at the supermarket. If we all choose the £2 option, we'll each have £1 more to put into other parts of the local economy - fair enough. But by doing that we'll also drive LocalButcher out of business, depriving ourselves of the option of choosing something other than the supermarket - which will then be free to set its prices to whatever the market will bear (e.g. £3).

    The free market in goods and services is great up to a point, but beyond that point it tends to create monopolies - which are in nobody's interests but their owners'.

    ReplyDelete
  5. I think the "devastating critique" is very persuasive until you boil it down as Phil has. Still, I'm less sure what that has to do with LocAle which at its basis seeks to persuade pubs to take at least one local beer on a more or less permanent basis, not to switch entirely to local beers which is the nub of the other argument. It doesn't even have to be the same beer and gives small breweries an "in" that they otherwise might find difficult.

    People like local beers. They used to be big around the UK. Remember that?

    ReplyDelete
  6. As an economic concept "buy local" is as much use as "buy british". An efficient economy is best served through free trade. If imported good are either better or cheaper, our economy is best served by finding something we can export rather than restricting imports, imposing tariffs etc.

    Local butchers & grocers, from my observation, are as cheap as supermarkets and often better. Especially fresh fruit. However they are only open when I am at work and closed when I get off work. So I go to Tesco.

    As for expressing a preference for a locally brewed beer. If locals preferred that, why would it need a campaign? And if the local beer lacks brand value compared with a national brand, isn't that the job of the producer?

    ReplyDelete
  7. Cookie

    In answer to your third para, like any good debater, you already know the answer. For those that don't, the answer is because the market is restricted and restrictive. People didn't choose to lose their local beers. The market decided that.

    And brand value? That's a different issue I'd say.

    ReplyDelete
  8. "People didn't choose to lose their local beers. The market decided that."

    Surely in effect then they did choose to lose their local beers by stopping buying them? "The market" is only an accumulation of millions of individual decisions.

    ReplyDelete
  9. Curmudgeon: you're picking up on sloppy wording by Tandleman.

    What happened in Liverpool is quite typical of what happened in many British towns and cities. Our popular local brewery, Higsons, was taken over by Boddingtons, which in turn was swallowed by Whitbread, who closed the brewery even though Higsons sold well. Having got the pubs and the brand, they ditched the brewery (and the brand a couple of years later).

    The market, as a manifestation of millions of decisions, had nothing to do with it. Local breweries didn't wither on the vine through people losing interest ~ they were taken over and closed by the big boys.

    For some reason,successive governments like this kind of behaviour in the beer industry, only it's the PubCos who are behaving in a predatorial and protectionist manner, not the breweries.

    ReplyDelete
  10. You are right RedNev. What I meant to do and didn't, was put quotation marks against "the market." It was bigger fish eating little fish and the greed of shareholders (mostly institutional)that destroyed local breweries, not people choosing to drink non local beers.

    Either way, Locale and the quoted example ain't the same.

    ReplyDelete
  11. But surely the process of inefficient enterprises being taken over by more efficient ones is a key part of the "creative destruction" which in the long term makes us all more prosperous. Would we really all be happier or better off if we were still driving around in crappy Hillmans and Standards and watching Baird and Mullard tellies?

    Many of the small breweries of the 50s and 60s were poorly-run, inefficient enterprises. Many were run by ageing family members who actively wanted to sell out to Whitbread and realise the value of their investment. Others produced beers that were poorly regarded in their localities (Swales' Swill, anyone?). To deny this is to look at the past through rose-tinted spectacles.

    Of course, by the way, I recognise that the postwar era had a general mentality of corporate rationalisation in the name of "efficiency" which is very different from the present day where it is much easier for niche to co-exist with mass-market. And, to be honest, I would say any connection between Locale and the Whitbread Tour of Destruction is very tenuous.

    ReplyDelete
  12. So would I Mudgie, but that's your analogy. What happened in the 50's and what happened in the 80's were driven by different things. Like your example, they just ain't the same.

    Of course there is truth in what you say about efficiency and progress, but you move away from your own theme. Are you really saying that local people enjoying local ales and making room for the odd one on local bars is a retrograde thing?

    ReplyDelete
  13. "Inefficient enterprises being taken over by more efficient ones". There speaks a true free market Darwinian ~ survival of the economically fittest. It sounds good, Curmudgeon, but doesn't stand up to much scrutiny.

    We all know some old breweries were inefficient and their owners wanted to cash up and retire to Bermuda on the proceeds. But that wasn't true of all smaller breweries. Some made good beer, were efficient in terms of the business practices of the times and were liked. It's just they eventually fell to the economic power of the giants, who were capable of buying breweries at above the market value, and sometimes did so to close down smaller rival brewers and grab their pubs. It's not surprising that some owners felt they'd been made an offer they couldn't refuse.

    So it's not quite survival of the fittest after all. More a case that "every man has his price" and the big boys were prepared to pay it in pursuit of unbridled expansion.

    Your reference to crappy Hillmans et al is amusing, but beside the point.

    ReplyDelete
  14. Oh dear. Once again I must humbly disagree with the learned Cookie. I find his fervent belief in the so called “free market” rather charming, if misplaced. Personally I’ve always found it more of an ideology than a sound theory, even when it was being drummed into me many moons ago.

    Of course, this idea of the “free market” balancing itself has long been a staple of the school of rational economics. And this, until recently, was the predominant model favoured by many of the great and good. Possibly its greatest cheerleader was Alan Greenspan who famously espoused Globalisation as the ultimate in free market rational economics and the perfect example of “arbitrage”.

    Having recently returned to the blackboard, it was interesting (and slightly gratifying) to see that they now teach that markets aren’t necessarily rational and that there’s no such thing as “arbitrage”. Of course the laws of supply and demand are still regarded as universal, but even their roles have now been reversed!

    So I would say an efficient economy is not best
    served through free trade.Nor by cheap imports at the expense of home grown produce. Which is where I came in, I think.

    ReplyDelete
  15. Here's another article explaining the benefits of free trade and specialisation versus local production and self-sufficiency:

    How humankind was liberated from localism

    But if you want to get the local blacksmith to knock you up an iPad, be my guest...

    Incidentally, I thought a policy of encouraging local production and reducing dependence on imports was one often favoured by right-wing nationalist dictatorships ;-)

    ReplyDelete
  16. "you wouldn’t want to go on holiday to Cornwall and find Holts as a guest beer"

    But perhaps you might like to if you lived in Cornwall.

    ReplyDelete
  17. "I thought a policy of encouraging local production and reducing dependence on imports was one often favoured by right-wing nationalist dictatorships ;-"

    True, but not exclusively: Cuba and Sukarno's Indonesia, neither right wing, also followed that path. As has Korea, but whether the world's first Communist hereditary monarchy is left or right is difficult to determine.

    ReplyDelete
  18. "True, but not exclusively: Cuba and Sukarno's Indonesia, neither right wing, also followed that path. As has Korea, but whether the world's first Communist hereditary monarchy is left or right is difficult to determine."

    Indeed, it often seems that the political spectrum is less a linear scale than a circle.

    And the one thing all these "self-sufficient" countries have in common is poverty.

    ReplyDelete
  19. I champion LocAle as part of my support for CAMRA in my pub (my permanent cask ale is the excellent Harvest Pale by Castle Rock) and on my menu the only thing I guarantee is local is the meat we use in our dishes.

    The rationale behind this being I (and many of my customers) consider the welfare of the animals we consume is important as is the effect of ante-mortem stress in the slaughter process.

    The fact that I use an award winning butcher and that the meat is all free-range, with an easily checkable provenance means that I do pay a premium for these products.

    The customer benefits from better tasting meats, the dreaded carbon foot-print or food-miles are limited and because I choose to operate on a lower than industry average GP they get very good value for money.

    This all goes some way to obviating what my award winning greengrocer cannot source locally or within season that my customers also demand.

    As with most things in life this is a compromise, which, is the only way to pull oneself off the horns of a dilemma.

    ReplyDelete

Comments, especially on older posts, may be subject to prior approval. Bear with me – I may be in the pub.

Please be polite and remember to play the ball, not the man.

Any obvious trolling, offensive or blatantly off-topic comments will be deleted.

See this post for some thoughts on my approach to blog comments. The comment facility is not provided as a platform for personal attacks on the blog author.