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Comment by kolbe | Hacker News Reader

Farming is low margin. Farmers don’t get to set the price of their products, and they aren’t handed billions in capital to burn through or 1000x multiples on their profit in the public markets. When most businesses say they can’t hire someone and the reason is because they don’t pay enough, the underlying cause of their low pay is usually because that’s what the company can afford.

Sure, farmers could pay $10/hr, but unless your Doritos were $10 a bag, they’d lose money.

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...yes? The alternative to farmers is not harvesting their crops at all, since with the borders closed foreign labor is not available.

If nobody wants to buy $10 doritos, that means the product can't exist in a market without cheap labor.

Well perhaps that's the problem of the market. That it can't particularly function to enrich some people without gross levels of exploitation.

To me it always seemed a bit similar to justifications used for the "peculiar institution" - the system can't exist without slavery, therefore slavery must exist. The benefits of cheaper labor was well appreciated; Carnegie called immigration "the golden stream which flows into the country every year."[1]

[1]https://www.ebooksread.com/authors-eng/andrew-carnegie/trium...

Being paid $5/hour farming in Australia vs $0.50/hour assembling shoes in Malaysia. Wow, such exploitation.

"Exploitation" is a relative term, some people would rather be exploited in the countryside of a first-world nation rather than the countryside of their homeland.

> Being paid $5/hour farming in Australia vs $0.50/hour assembling shoes in Malaysia. Wow, such exploitation.

The Australian national minimum wage is $19.84/hr.

Getting paid about a quarter of minimum wage is very clearly exploitation. There may be other benefits for actually working in Australia, but that's not really relevant here when you're trying to attract native Australians to work for you.

In particular, when the wage is low enough you have slavery in all but name. People working for your shitty pay staying in your shitty dormitory eating your shitty food because they can't afford not. The end result people leaving when visas run out with more debt, and headlines about people forced to pick fruit in bikinis and allegations of sexual assault, because that happens when some people gain that sort of power.

Yes, they are both exploitation and they are both evil.

Which is more exploitative, working for $5/hour in agriculture in a wealthy country, 50¢/hour in an urban factory in a poor country, or $1/day in a rural peasant village somewhere or having no work at all?

It’s all relative.

That's a bit like asking, "Which is worse? A shot to the head or an overdose of morphine?" Either way the person's going to die.

Doritos aren't going to get more expensive, because like all the real staple crops, corn is completely mechanized, and you have one guy driving an air-conditioned tractor or combine, following GPS-plotted courses.

True! Except it's not just doritos, it's everything you eat.

And it's not just cheap labor, it's labor exploited under pain of deportation.

Not sure that’s the best example to use, since food costs are a trivial fraction of the retail price of a bag of Doritos, and harvesting labor is a trivial fraction of the price of food.

Edit: that was just based on my general memory of non-perishable food economics. But I googled it and found this (sorry, quora) from someone who would know, a 2 oz bag of potato chips costs 15 cents to produce and bring to (retail) market. Of that, a fraction is potato prices.

https://www.quora.com/How-much-does-a-bag-of-57g-of-Lays-act...

Edit: fix Verizon math.

The reason I buy expensive eggs, milk and cheese is that I know that the supermarkets fuck over the farmers. I never buy the supermarket brand, unless it's the last one on the shelf. The price difference is sometimes 1.5x but unless you're really "broke" broke, you don't notice the difference. It's a few cents a week.

Good idea, but how do you know the extra money is properly passed on?

While, like most things in life, it's not a guarantee, doing basic research about the farms and the cooperatives that produce the goods will provide some insight. Almost anything is better than a CAFO (Concentrated animal feeding operation).

I always buy the supermarket brand, even though I can easily afford more. It's not because I want to save a few pennies on each purchase; it's helping to drive prices down on all overpriced goods, helping out those really in need.

Same reason I avoid organic whenever possible. We don't need boutique food.

I agree much of the “benefits” of organic food are not really true or meaningful, but I do try and buy local when I can.

That doesn't even make sense in neoclassical economics. One person's effects on the market are necessarily tiny, but if buying more of Brand X has any effect it will be to drive up the price of Brand X. You're actually harming "those really in need", and you should feel bad about it.

> Farmers don’t get to set the price of their products

Actually farmers could set any price if they colluded to manipulate the market. People will buy food at any price and everyday.

This is offset by imported food. If 100% of American farmers colluded to fix prices, they'd have their lunch eaten(hah) by food importers. Obviously not everything is importable(eg rice), but there is more to the market than the American farmers.

You're right, there is more to the market but not how you describe it. Tariffs are available to any American cartel willing to buy enough politicians. Take a look at sugar, for example. [0]

[0]https://www.cato.org/policy-analysis/candy-coated-cartel-tim...

People have to eat food. Food in aggregate has one of the most inelastic demand curves imaginable. If the price rises because the production costs increase, people will still buy food. They might buy different food, and you'll see a decrease in acreage given over to labor-intensive crops, but that's just the free market at work.

The thing is, if farmers in Australia increase wages and thus their product becomes more expensive, the product on supermarket shelves will not become more expensive. Rather, supermarkets will import food from another country. Food is, with few exceptions, a commodity. The producer does not set the price of the commodity, the market does.

I am telling this as an engineer working in the Canada's oil and gas sector. Since 2014, salaries in our sector have decreased and firms are struggling. "Just raise the price of oil" is not an actionable advice. The price of oil is not ours to set. It's the market's

It just shows most people working in Tech Industry, and specifically software ( or web ) development ( as oppose to Tech / software within Oil Industry or any other industry ) have absolutely zero idea on market or commodity trading.

I consider food security a national security issue. Produce is one of the few areas where I would consider a tarif justified. Every country should be able to feed it's citizens with the food grown there, or they risk hunger when cut off by war or natural disaster.

And countries do that, but for a few strategic ones, not everything. Canada produces lots of wheat and dairy and maple syrup. It even has a strategic maple syrup reserve. But it does not produce a lot of citrus fruits or pistachios or dates. It may be possible for US to produce everything within the country—it is a gigantic country and has just about every climate there is. But it would be an ecological disaster if countries without those attributes do the same. Think of all the heating required to produce warm-climate fruits in Canada.

Oh! One of my favorite ag articles talked about the challenges of growing oranges in russia!

https://www.lowtechmagazine.com/2020/04/fruit-trenches-culti...

You're absolutely right that perhaps not everything should be grown everywhere, but I strongly believe that a country should have a local source of all the calories and vitamins / minerals they need. In Canada, for example, maybe they encourage farmers to grow greens, brocolli or potatoes instead of citrus for vitamin c, but they absolutely need a source.

Apples and Oranges. If you include global supply, then you have to increase salaries "globally". We all (I assume) should know that demand/supply set the price.

But imported products don't fly right into the country. There is customs, and denying/tariffing them is a policy that countries are very actively using. So at the end of the day, it's a political decision.

Edit: On the other hand, if you are exporting stuff (oil for Canada), then you can't really do that for the external market. Might explain why the government will let some sectors run with illegals (to remain competitive); the alternative being their ultimate demise.

If you ban import X from a country, the country will likely ban import Y from your country in retaliation. Sometimes the net effect would still be in your favour, but often times it would not be. Do you know why American brands dominate the US truck market? It started with a tariff on American chicken by some European countries and it quickly snowballed into much more [0][1].

[0] https://en.wikipedia.org/wiki/Chicken_tax

[1] https://www.npr.org/sections/money/2017/01/25/511663527/epis...

The EU sets fairly high tariffs on food imports, since food security means we must maintain local food production.

Australia does not use this approach, and instead seems to have pushed other countries to eliminate their own tariffs for the TPP.

What tariff does is that it moves the price point at which the retailers switch to imports a bit higher. Tariff does not eliminate the ceiling. There still would be a ceiling on price, determined by international commodity price + X% tariff.

So the tariff needs to be high enough to be absolutely ruinous. See, for example, Canada's tariff on dairy. Since Canada runs a cartel on dairy producers, Canada does set the domestic price of milk at $4/gal. This is incompatible with the US subsidy model, where it prices out to around $1.50 a gallon -- so there's a 270% tariff on dairy imports. The great thing about numbers is there's always a bigger one.

Yes, you can do that. It's not something the farmers strapped for workers can do, but the government certainly can. It would not be particularly popular in most political climates, so passing such laws in democracies are always difficult. But as the Canada example shows, not impossible.

So.... reduce production, and supply/demand curves should get you back financially on track?

Of course, you might get pilloried for the artificial scarcity, but hey... nobody ever likes the capitalist :)

We reduce production, US, Russia, and Saudi Arabia would be more than happy to fill the gap. Actually Saudi Arabia prefers prices that are lower than the strike point for non-traditional oil, so it can get rid of competition from likes of Canada. How should we convince Russia and Saudi Arabia to take a hit to their exports in order to help us out, when we cannot even convince our biggest ally, the US?

Sure, but they'd lose less money than if they didn't hire anyone and couldn't sell their crops at all.

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