Are Plant Patents the Problem?

There is an interesting article at Slate.com by Frederick Kaufman on GMO seeds.  Although I don't agree with his conclusion, this is the sort of nuanced view about GMOs that deserves more attention.

In short, my take is that Kaufman sees some GMOs are good and some as bad, and the bad are mainly (in Kaufman's) view the result of plant patents.  Here is Kaufman:

Intellectual property laws need to be rethought. A copyrighted movie or book remains the same movie or book, but when food becomes a legal construct or an intellectual property right, it stops being food. Of course, you can eat patented popcorn the same way you can consume its unpatented cousin. But unlike an iPhone or a flatscreen TV, everyone needs food, and we need it every day. . . . Since everyone must participate in the food market to the tune of 2,700 or so calories a day, food property rights allow those who hold food patents a guaranteed portion of profits from a guaranteed purchase, which is fundamentally unfair. Why should Big Ag possess privileges beyond any other sort of business on earth? The rules that govern patents for electronics and entertainment should not be the same rules that govern the most vital element of human life.

I'm not at all convinced by the "we need food to live" argument that somehow makes the patent and copyright laws for food different than those for software, electronic books, or other technological innovations.   

The thing that Kaufman discounts is the incentive that patents give the innovator to innovate.  He seems to think many scientists will innovate from intrinsic motivation.  This is made explicit in the following quote:

Like many scientists, Dr. Ronald’s primary motivation is not profit, but insight into the workings of nature.

While that might be true of some, I doubt it is true for most.  And it is almost certainly not true for those innovators at the margin.  Patent (and copyright) laws try to balance two competing factors: 1) the incentive to innovate and 2) allowing the invention to be more widely distributed in the population so the gains are more widely shared.  I am open to the argument that these two things need some re-balancing - perhaps by shortening the time a patent or copyright is in effect.  But, to totally ignore the incentive to innovate is, I think, unwise.

Finally, I think we've got to take a step back and ask what a world would look like if Monsanto couldn't patent seed - if farmers could freely replant progeny.  Monsanto might very well use their terminator technology.  But, even if they didn't, they'd almost certainly change their pricing.  Here is what I had to say about the issue a couple months ago:

What do you think will happen to the price of the first generation seed if farmers are able to freely replant the progeny?  

As Steven Landsburg points out in his wonderful (and recently re-released) book The Arm Chair Economist the indifference principle must always be at work.  The principle suggests that at current prices, (the marginal) farmer must be indifferent to buying Monsanto seed given that he cannot replant the progeny and must buy seed again next year.  However, if the Supreme Court rules that Monsanto does NOT own the progeny, then the value of the seed to farmers rises since they can re-use the seed.  The marginal farmer is no longer indifferent.   For the indifference principle to hold (i.e., for equilibrium to be restored), the price must rise.  Monsanto will charge more for it's initial offerings if farmers can freely replant.      

As an analogy, consider the market for textbooks.  Bailey and I wrote an undergrad textbook on Agricultural Marketing and Price Analysis a few years ago (in which we somewhat ironically discuss the indifference principle).  Buying a new copy of the book is pricey (Amazon.com has the current price of a new copy at $97.41).  What do you think would happen to the price of the initial offering of the textbook (i.e., the price of a new copy) if Bailey and I (and the publishers who actually sets the price) could receive royalties when the used textbook is resold in bookstores after the semester?  The initial price for a new book would almost certainly fall.  

The Monsanto case is simply this example working in reverse.  

I'll conclude by admitting that I'd probably write fewer books if anyone could copy or distribute my work without attribution or compensation.  I think a lot of geneticists and plant scientists would feel similarly about their work.

Externalities

Back in April I gave a talk at a workshop organized by the Institute of Medicine of the National Academies and the CDC entitled Exploring the Health and Environmental Costs of Food (you can read a summary of what went on at the workshop here).  

The premise of the workshop was that there are externalities in food production and our job was to quantify them and think about correctives.  There were many very smart people in the room but only a handful of economists.  If you read the summary report (see parts in chapters 6 and 7), you can get a bit of a sense of the disagreement that went on between economists on the one hand and nutritionists/epidemiologists/ecologists on the other (the report calls it "lively") about what constitutes an externality and whether "experts" can properly devise taxes to fix the problem.   

This video by Mike Munger should have been required viewing for everyone at the workshop.

Find LearnLiberty on Facebook: http://on.fb.me/VLLCWp If Art sells potato chips to Betty, both Art and Betty are happy with the transaction. Betty has chips, and Art has been paid for them. If Betty eats her chips loudly and it irritates Carl, then Carl bears a cost because of Art and Betty's transaction.

Give (Frozen) Peas a Chance — and Carrots Too

That's the title of a nice article by Dr. Oz in Time Magazine earlier this month and he echos several themes in my forthcoming book, The Food Police.  I was pleased to finally see some good sense on food by someone so prominent in the media.  Here are some excerpts:   

Nutritionally speaking, there is little difference between the farmer’s-market bounty and the humble brick from the freezer case. It’s true for many other supermarket foods too. And in my view, dispelling these myths–that boutique foods are good, supermarket foods are suspect and you have to spend a lot to eat well–is critical to improving our nation’s health. Organic food is great, it’s just not very democratic. As a food lover, I enjoy truffle oil, European cheeses and heirloom tomatoes as much as the next person. But as a doctor, I know that patients don’t always have the time, energy or budget to shop for artisanal ingredients and whip them into a meal.”

and:

The rise of foodie culture over the past decade has venerated all things small-batch, local-farm and organic–all with premium price tags. But let’s be clear: you don’t need to eat like the 1% to eat healthily. After several years of research and experience, I have come to an encouraging conclusion: the American food supply is abundant, nutritionally sound, affordable and, with a few simple considerations, comparable to the most elite organic diets

and

But for the most part, it's O.K. to skip the meat boutiques and the high-end butchers. Nutritionally, there is not much difference between, say, grass-fed beef and the feedlot variety. The calories, sodium and protein content are all very close.

Deck the hall with boughs of holly (unless holly doesn't grow where you live)

Today Forbes.com published a piece I wrote with Henry Miller, who is a fellow at the the Hoover Institute at Stanford University.  The piece is on local foods, and now (in the winter, at Christmas) is perhaps one of the best times to think through the logic of locavorism.  

Here are a few snippets from the beginning:

The Christmas season brings visions of candy canes, cider and sugar plums dancing in the head.  Unless, that is, you’re a committed locavore who has scorned peppermint, sugar beets and apples, because they’re not found in your neck of the woods in the summertime, much less the dead of winter.

The desire to help out a neighbor or even a local farmer can be a noble one, especially in this gift-giving season, but sentiment shouldn’t keep us from thinking critically about the consequences of forcing municipal hospitals, schools and other institutions to source an arbitrary percentage of their food locally.

and the end:

If we are to live by the locavore’s mantra that we will consume only what can be made locally, we had better board up our chimneys on Christmas Eve.  No matter how magical are his reindeer or how benevolent his elves, we daren’t accept Santa’s wares because, well, the vast majority of them are made far away.  No self-respecting locavore would be caught dead sucking on a candy cane made at the North Pole.

Yet, St. Nick is a good guy and deserves our respect and patronage as much anyone else.  The same goes for our local farmers.  If we trust our local farmer to give us what we want and you do the same, then surely we can trust your local farmer too.  And your local farmer is probably better at growing some things than ours.  So as we send holiday greetings to dear friends far and wide, let’s not demonize those who want to do the same with food

Food Ethics Blog

I just ran across The Food Ethics Blog by Chris MacDonald.  It looks very interesting, and I was especially intrigued by a couple posts on whether we have the right to know what's in our food and whether food companies have a moral obligation to label GMOs.  Be sure to read the back-and-forth in the comments section, which is just as good as the original posts.