LETTERS
Letters Genteel Populists In the excerpt from The Genteel Populists in your January issue, Simon Lazarus says, ”Morton Mintz and Jerry Cohen, both close associates of Ralph Nader. . . .” This...
...Specifically, Lazarus argues three points against federal chartering: 1) that it would never pass Senator James Eastland’s Judiciary Committee...
...While I do find Nader’s interest in New Dealish regulatory schemes such as the FCA to be misguided, at the same time the book from which my article was excerpted emphasizes Nader’s brilliantly creative role as founder and leader of the new populist movement...
...Nader’s, idea...
...What we did, rather, was to commend a course of action that seemed to us to best fit the needs we had detailed and was philosophically and ideologically compatible with our political system...
...it represents a specific capacity for work, whether a tractor ingests it as gasoline or a farmer ingests it as food...
...d) Disclosure of corporate information to shareholders and the government, including financial accounting by plant or product line, the extent of international operations, and the disclosure of real ownership whether by individuals or by large banks and holding companies...
...A calorie is a calorie...
...As for Mr...
...In other words, fertilizers make the land more productive (more crop per acre...
...between its Extension Service (which offers free advice to farmers) and its subsidy programs, the USDA has done everything possible to encourage farm consolidation and mechanized agriculture...
...European agriculture is protected from competition by a number of tariff barriers and regulations...
...For the FCA would be an agency whose raison d’etre would not be regulation such as practiced by the ICC or the CAB...
...The fact is that agencies such as the National Highway Traffic Safety Agency and the Environmental Protection Agency have active consumer constituents that keep these agencies more responsive than others...
...Since the turn of this century agricultural economists and farm management experts have generally offered one solution to fmmers plagued by low agricultural prices: increased volume and lower costs...
...More production meant I) gsuresatateinr evdo lluomwe ,p rwicheisc,h wmheicahn t dmemoraen dperodd yuect tion and larger farms and on and on and on...
...The Act put a limit on the number of VHF licenses a single broadcast ownership may hold...
...Mintz’ complaint about my critique of the concept of federal chartering, let me just say at this point that I agree with him that federal chartering, in the sense he envisions it, as an effective and durable check on corporate power, is probably not “as a practicable matter, achievable at all.’’ It continues to puzzle me as to why Mintz, Cohen, Nader, or other reformers should be promoting an idea which even they are unwillling to endorse as politically realistic...
...My article discussed the high American consumption of meat, and in mentioning the “beef shortage” my point was precisely hers: that it’s difficult to expand or alter supply immediately...
...So, in the past that 1,000 A. might have been divided into five or six farms and supported five or six families, while now the 1,000 A. comprises only one farm, but supports three families...
...A growing body of scientific evidence points to the heavy vegetative losses which occur when coalburning facilities pollute the air...
...Simon Lazarus replies : In describing Morton Mintz and Jerry Cohen as “close associates of Ralph Nader,” I had no intention of calling into question the professional integrity of either...
...6) As for those small European farms, there are several things to keep firmly in mind...
...While the decrease in farm families may not be exactly proportional to the decrease in farms, the fact that only four per cent of our people are now working on farms instead of 15 or 20 per cent earlier in the century indicates to me that people are leaving the farm...
...Farm and grassland energy yields will certainly drop if large conversion plants are built on the Northern Great Plains...
...Higher human disease rates will also exact an energy toll...
...Our manuscript made it clear that there were a variety of reasons for the low net yield...
...It won’t happen, however, without rational public policies to encourage it...
...EDWARD FLATTAU The editor replies: JEFF STANSBURY Of course we should have checked these changes with the authors...
...The FCA’s role would be to police and enforce the charters...
...The difference is that one type of agency sets truck rates between Kankakee and Kalamazoo while the other type bans unsafe products or polices stock market frauds...
...6) I agree with Ms...
...The Federal Communications Act gave the FCC seven commissioners...
...land, says, “Yet the odds are high that the Finally, Lazarus, despite Senator East- # concept of the federal charter-will soon become law...
...He says, “But the mystery that remains is how Senator James 3. [the middle initial is “O...
...I don’t intend to let big business off the hook...
...To achieve this it was necessary to increase yields with fertilization and high yielding varieties and to increase individual farm size by mechanization and the consolidation of farm units...
...The largest single holding is 24,273 A., controlled by the Amana Colony, a religious colony which now engages in industry as well as farming...
...The feeder calves are produced on western ranches and midwestern farms, and fattened primarily in farm feedlots...
...We do no such thing...
...First, the decision to commend federal chartering of corporations was made entirely by us, without consultation with Nader and, indeed, without knowing what views, if any, he may have held...
...RICHARD MORGAN DOWNEY Washington, D. C. Morgan Downey works for Ralph Nader’s Congress Watch on federal incorporation...
...5) Nothing would please me more than having predictions of world food shortages turn out to be wrong...
...Lazarus may be correct that federal incorporation and vigorous antitrust enforcement may not cure all the problems of our economic-political world...
...c) Limitations on the corporations’ control of the relevant markets...
...The published version of our article made it appear that the necessity of land recontouring would make shale oil production yield very little net energy...
...There are some indications that consolidation of farm units has begun to slow in the United States, at least outside the south, but that it is still on the rise in Europe...
...Fertilizer was so cheap that farmers, who spend a considerable amount of time every winter pondering costlbenefit ratios, sometimes found it more economical to buy fertilizer than to utilize manure...
...Maybe it will...
...that limit has never, to my knowledge, been exceeded...
...Downey’s defense of federal chartering, I am puzzled when he asserts that “federal chartering would be about as vague as the Ten Commandments,” as if this were a compliment to his boss, Mr...
...In attempting to make the point that the energy figures are more complicated than they seem, because “you can’t eat gasoline,” your editors added the statement that Perelman’s “equation” is “somewhat invalid...
...My point was that small farmers (not small lot operators) will, too...
...3) There are no million acre (A...
...I don’t think that would be a panacea, but if Lazarus thinks we ought to leave regulation of Exxon to Delaware, would he please forthrightly say so...
...and no matter how we may wish it otherwise...
...2) Farmers have been encouraged to heavy fertilization and bigger machinery, but not because of farm programs...
...The “all kinds of technology” that “became available” after World War I1 came into being largely thanks to the USDA’s largesse in sponsoring research projects...
...It is unfortunate to find such confusion in a lawyer as good as Lazarus...
...MORTON MINTZ Washington, D. C. Morton Mintz is a reporter for The Washington Post...
...Joseph Browder, whom we cite in the article, made another valid point, which was cut from the manuscript...
...In the first place, federal chartering legislation has historically been referred to the Senate Commerce Committee and not to Senate Judiciary...
...This is careless writing, whatever Lazarus may have meant by it...
...it has never had eight...
...The fertilizer industry expanded production-betting on the come-and ended up with overproduction...
...b) Responsibilities of directors and management to recognize the interests of employees, consumers, and communities...
...Several minor but irritating editorial errors appeared in the article...
...A second deterrent to a reverse in the trend to farm consolidation is the rise in costs...
...Consumers play a role in economic ill health too...
...Three brothers, for example, farm 1,000 A. in the county where I grew up...
...The law would contain such ‘%acuous’’ ideas as a) Shareholder rights to exert greater control over the board of directors...
...3) I am guilty of hyperbole for writing “the million-acre commercial farmer” in my article...
...4) Unfortunately, rising fertilizer costs may prove a boon to the large custom feed lot by providing a second source of incomethe processing of organic fertilizer...
...Note this disclaimer on p. 362: However, we do not pretend to do more than present an outline and to indicate the general direction a federal incorporation law should take...
...Even so, this negative attitude, “It could never pass,” is irrelevant...
...Simon Lazarus’ article, “Ralph Nader, The Last New Dealer,” presented a number of misconceptions concerning Nader’s proposal for federal chartering legislationthe proposal that the large national corporations be answerable to the federal government for their legal existence and not to the states...
...Smith thinks she is quarreling with me...
...But how does he know what such an agency would do in a climate so different from today’s that the enabling legislation necessarily would have had to slip by old Jim Eastland...
...Such was not the case in 1973, and is not expected to be the case in 1974...
...We cited Michael Perelman’s calculation that the energy value of the food Americans consume is roughly equal to the energy burned by tractors alone, and that the total gasoline consumption in American agriculture represents more than five times as much energy as Americans finally eat...
...We apologize for our failure to do so...
...A typographical error made one sentence refer to converting “costs” into electricity, instead of converting coal...
...it flows from the achievement we say we hope-not will-be made...
...Letters Genteel Populists In the excerpt from The Genteel Populists in your January issue, Simon Lazarus says, ”Morton Mintz and Jerry Cohen, both close associates of Ralph Nader...
...He goes on to ridicule “this athletic metaphor...
...Farmers have been on a treadmill for half a century with only occasional brief respite...
...We don’t know this for sure, however-and neither does the Interior Department, which is now leasing shale oil lands to private fuel companies...
...Lazarus misapprehends what Jerry and I did in America, Inc...
...and 3) that a federal corporation agency would .be a regulatory agency and would be taken over by the corporations it would seek to regulate...
...Calories and BTUs are a universal currency, transferable from food to people to machines to thinking to swamps to Sunday mass...
...Finally, the words “Without sounding pompous...
...we can grow only one crop of soybeans a year...
...In other words, a decrease in the number of farms may not be directly proportional to the decrease in farm families...
...As Harrison Wellford documents in his book, Sowing the Wind, and as James Hightower explained in an article in 7’he Washington Monthly last September, the government’s projects have disproportionately favored the large, capital-intensive farmer...
...It is not...
...Farmers may soon be right back on the traditional treadmill...
...With respect to Mr...
...Secondly, we said not a word-not a wordto suggest that federal chartering was easily achievable or, as a practicable matter, achievable at all...
...2) that it will be a vague, ill-defined law with conventional (Le., ineffective) sanctions...
...European farmers are subsidized as much and in some cases more than American farmers...
...If the rather grandiose antitrust and other notions that have been mentioned in the major briefs for federal chartering were to be pruned, and the concept would be limited to disclosure, federal chartering might be a useful and even practical-though small-step forward...
...At another point in my book, I characterized Mink as “one of the best investigative reporters in Washington,” and referred in similarly positive terms to Jerry Cohen’s outstanding career as Counsel to Senator Hart’s Antitrust Subcommittee...
...Third, shortages in agricultural products are by their nature not immediately remedied: the cow must gestate and give birth, the calf must grow to market weight at a genetically determined pace...
...But that hasnot been the nature of the beast as it has been portrayed to date...
...Small lots have no advantage in utilizing manure...
...Major water resources are # consumed in the conversion, not the “producing” of coal...
...Although farms have increased in size over the years, there is also a trend toward family partnerships...
...Secondly, federal chartering would be about as vague as the Ten Commandments...
...We never thought for a moment, of course, that Eastland could be “hoodwinked,” or that we were in the slightest degree hoodwinking any reader (but Lazarus) into thinking the Senator could be hoodwinked...
...But Lazarus’ most glaring misinterpretation was to confuse the role of the Federal Corporation Agency (FCA...
...My “associates,” as I understand the word, are my colleagues at The Washington Post, and I have no other...
...we say what we think “should” and “could” be done...
...As edited, the article says that “despite” America’s moderately high per-acre crop yields, American farmers use inordinate amounts of petroleum...
...Dollars also presume to play this universal role, but they do not measure real-world transactions anywhere near as effectively, It is essential to realize that if the West is extensively strip-mined, Americans will sacrifice not only “potential” sources of energy, as the edited version of the article stated, but also forms of energy which are presently flowing to them...
...Downey is correct in saying that federal chartering legislation has historically gone to the Senate Commerce Committee, but wrong if he thinks history would keep a new chartering proposal away from Judiciary, if, as its proponents have advertised, the bill contained antitrust features...
...Second, the supply of beef cattle has increased steadily since the 1940’s to match a steadily rising demand...
...Last, Europe is oing through the same machinery/fertilizerjand consolidation revolution that the U. S. has experienced in the last 30 or so years...
...The natural grasslands of the Northern Great Plains require no fertilizers and few, if any, pesticides...
...When one farmer produces more per acre on more land he has higher volume and higher income...
...LOLA SMITH Washington, D. C. James Fallows replies: To take them in order1) I have no quarrel with these points and am surprised Ms...
...We can’t blame big business for catering to our own greeds and whims...
...The Ten Commandments are not, I had supposed, widely regarded as a model of either precision of content or effective enforcement...
...unearthing all that buried shale, subjecting it to intense heat, and squeezing out the oilbwill require prodigious sums of energy...
...In the past each brother would probably have farmed alone as an individual proprietor...
...Lazarus with similar distorted emphasis, says we “quaintly” conclude that federal chartering would allow the government to regain its proper role as quarterback of the economy...
...our punctuation made it clear that we objected only to those whose dollar-mindedness prevents them from understanding net energy...
...And the hard sell...
...Inflation in other areas of the economy increases the farm family’s living costs as well...
...Be that as it may, if the optimists are right and farm prices remain high, it will indeed offer an opportunity to decrease farm size and increase the number of farmers, since the individual proprietor will be able to make a decent living on a smaller amount of land...
...First, although many cattle are fattened in big commercial feedlots, the “cattle industry” is largely small business, at least as far as the packing house gate...
...If that attitude were one to be taken seriously, the Clean Air Act would be sitting on the shelf of the Sierra Club and auto safety legislation, a pipe dream...
...They produce a high net-energy beef crop that Americans ?e harvesting right now...
...Consequently, the tone, although not the words taken literally, of Lazarus’ comments is misleading...
...Lazarus says we “blithely predict” that a chartering agency “will” write goals and priorities into corporate charters...
...No sane person would recommend the strip-mining of “deep” coal...
...In fact, we think it opens up a very useful h e of research for economists...
...tracts in Iowa...
...Calorie in for calorie out, however, U. S. agriculture is inefficient...
...I’m not sure exactly what’s referred to-what performance-but...
...A good many of the most influential “agricultural economists and farm management experts” have worked under the auspices of the U.S...
...Surviving the Seventies James Fallows’ “HOW We Can Survive the Seventies” [February] contains several misleading statements about agriculture...
...But this is akin to disparaging penicillin because it does not cure lung cancer...
...The punctuation of the published article made it appear that we objected to all economists, geologists, and capitalists...
...were inserted at the start of an unpretentious sentence which asked whether shrinking U. S. net energy yields might not explain the persistence of inflation during both upswings and downswings in business activity...
...e) Disclosure, in the form of a social statement, of such factors as product safety, job safety, abuse of credit checks and invasions of the privacy of employees or competitors, denial of free speech of employees through punishment for informing the government or the public of illegal or unethical activities, and corporate compliance of federal or state laws or regulations...
...A good world harvest may bring grain prices down from their present inflated levels, but I know of no responsible authority who claims that the long-term outlook is for cheap or abundant food...
...Our discussion of coal later in the article spells out this problem in detail, but that is no reason to give the reader an inaccurate defmition on the first page...
...We do not apologize for this question...
...1) Referring to the inability of our supply system to keep up with demand: “We need only recall the performance of the agribusiness companies during the beef shortage...
...If, alternatively, natural gas is injected into the shale and detonated, the energy costs of producing the oil may be lower...
...2) If in saying that farming has become mechanized “not because of farm programs” Ms...
...5) The Lks Moines Register, referring to the optimists among the economic prognosticators, editorialized rather sourly a few months ago that farmers can remember three years back even if some others can’t...
...Smith and find her points consistent with my argument, which was simply that some foreign farms have higher per-acre yields than those in the U. S...
...The unceasing growth in world population, together with greater meat-protein consumption, has pushed many food sources to their limits: declining or stagnant worldwide seafood catches suggest that the world’s fisheries are being harvested at their capacity, and this year, for the first time in decades, the U. S. has virtually no good cropland in retirement...
...wheat can be planted only at the proper season...
...AlI these minuses must be charged against the gross energy yield from western coal...
...Nor do we pretend that it is the total answer to all of the problems of society...
...Such losses amount to 65 per cent to 70 per cent for coal...
...In the Commerce Committee, the possibility of favorable action is higher than in Judiciary...
...Department of Agriculture...
...Net Enerw It goes without saying that we were happy to have The Washington Monthly publish our article on net energy (March, 1974), but last-minute editorial cuts, insertions, and rewordings damaged the essay’s credibility with informed readers...
...I suspect he may also underestimate what safeguards can be written into the law itself...
...The price of meat is much higher in Europe than in the United States...
...Lazarus goes on to predict that a chartering agency would “eviscerate” the chartering law...
...One should consider that the insatiable appetite of Americans for beef over all other meats and proteins might be an unhealthy demand in terms of a balanced agricultural economy and a balanced diet...
...But it can create the setting in which other fundamental reforms can move ahead...
...In defining net energy, the published article mentions the energy costs of producing and distributing the fuel and the loss of other potential ’energy sources, but it leaves out an essential element: the physical losses of energy which inevitably occur between the extraction of fuel and its final delivery in converted form to users...
...If she means that farm programs have not been a major force in this direction, I thinlc she is wrong...
...machines make the man more productive (more crop per man...
...but I don’t think we can let ourselves off the hook either...
...European nations want to retain the family farm just as we claim we do, but at the same time governmental policies and economic trends are encouraging development, through consolidation of farm units that are of viable size, i.e., sufficient to support the farm family, and to utilize modern technology more efficiently...
...High agricultural prices stimulate existing farmers’ appetites for more land, and also stimulate the appetites of “outside money” looking for a quick buck, especially if the quick buck is protected by tax loss provisions...
...As for Jerry, who does not as I do deal with Nader as a news source, he has talked to Nader two or three tirnes in his entire life and has never corresponded with him...
...At the same time, during the post World War I1 years, all kinds of technology became available to support this production revolution, and further technological developmentin a chicken and egg relationship-was in turn supported by the pressure for increased production...
...4) Yes, large feedlots will profit...
...It is because of, not despite, these high yields that petroleum consumption is so high...
...Possibly...
...Fallows on agriculture is proof that if the family farm is to be saved we must have spokesmen for farmers who can educate urban economists and urban writers about the workings of the agricultural economy...
...Smith means that some other factors were involved, I agree...
...The beef “shortage” hst spring was due to a combination of factors and something of an anomaly...
...There have been other times when the prospects looked bright for agriculture but didn’t pan out...
...There are approximately 26.5 million A. of cropland in Iowa, and 140,354 farms with average size of 239.1 A. 47% of the farms and 77% of the land is in units of from 180-499 A. A little over 1,000 farms are larger than 1,000 A. in size...
...Eastland will be hoodwinked into letting them [our goals] pass his Judiciary Committee...
...Such farms may be organized as corporations, partnerships, or informally...
...Almost all farms are family farms, even those of a thousand A. or more...
...In fact, cheap fertilizer was partly due to a previous prediction that the population explosion would mean markets for U. S. agriculture...
...there are those who accept the idea that the international oil companies should be chartered in Washington rather than Wilmington...
...ere is nothing quaint about our metaphor...
...The large lots can also use manure, after appropriate recycling, for feed, with fertilizer as a by-product...
...We can’t save agriculture for mall business any more than we can save ourselves from big business if we don’t understand how all sectors of the economy work...
...In 1972 production costs rose less than product prices...
Vol. 6 • April 1974 • No. 2
