One in three livestock farmers in the Netherlands are anticipated to lose their businesses as a result of a new pollution policy, so the Dutch farmers are out in force. Even though I believe we can all agree that less pollution is preferable, the suggested solution merely shifts the pollution to a different location rather than solving the issue. The only thing the Netherlands appears to be doing is sacrificing their farmers in order to reduce domestic food security.
Fiat societies produce fiat mindsets, which produce fiat solutions. The issue must have been resolved if we can no longer see it, right?
High Time-Preference Thinking Cannot Solve Low Time-Preference Problems
The government wants farmers to cut back on animal waste-related pollution. A low time-preference goal, called an admiral goal. Nobody, in my opinion, would object to this policy in theory. However, the arbitrary deadline appears to be an attempt to drive these farmers out of business through coercion.
Will this legislation result in a decrease in Dutch consumption of animal products?
Given that animal products will presumably need to travel farther to reach markets, what will happen to emissions?
What does the administration think about the presence of animal waste in the nations from which the Netherlands will now need to import its goods?
It’s challenging to avoid the conclusion that choices like these weren’t thoroughly considered over a long period of time. The idea of trade-offs is obscured by the lack of scarcity in fiat currencies. People are led to believe they can have their beef and eat it too in a system where there is no shortage; if I can’t see the poop, it doesn’t matter.
Coercion Is Weaker Than Incentives
The way we view animal waste is incorrect. As previously mentioned, this only exports the issue rather than actually fixing it.
What if the Netherlands exported an additional commodity in addition to having the second-highest agricultural exports in the world and domestic food security?
The BBC published a story in 2021 about a farmer who was using an anaerobic digester to produce methane, which he then used to mine cryptocurrencies and produce electricity.
This system is innovative and can actually help environmental objectives be met. Waste products are just an expensive and inconvenient cost of doing business under the current system.
Farmers are encouraged to manage animal waste more responsibly by turning their waste into a resource and potentially diversifying their sources of income. Every bit of waste that isn’t properly collected causes a leak in your energy system, making it less effective than it could be. Why would anyone want to waste a valuable and renewable energy resource when the conflict in Ukraine has forced Germany to restart its coal power plants?
Stop choosing Fiat products.
Assuming prices will rise somewhat due to the necessity of importation, I won’t even attempt to calculate the elasticity of Dutch demand for meat. But it doesn’t take a rocket scientist to realize that this choice worsens pollution rather than improving it. Emissions are added to the system via importation supply chains if demand is even somewhat similar to where it was before the decision.
This choice merely pushes the issue out of sight and out of mind, similar to using the money printer to cover up errors.
Long-term problems can only be effectively solved by implementing incentive systems as opposed to coercion systems.
Governments and individuals cannot adopt a truly long-term mindset until a bitcoin standard is adopted. Only in a system with signals from a free market and scarcity can trade-offs be understood. Fix money, and the world will be fixed. Let’s go make some poop profitable now.