Wal-Mart Ruining Organics for the Elites?

There’s an interesting piece in today’s NYT Magazine noting that, by attempting to make organic foods–now derided by many as an elitist luxury–cheap enough for the masses to afford, Wal-Mart may be undermining the very things that make organics desirable in the first place.

Assuming that it’s possible at all, how exactly would Wal-Mart get the price of organic food down to a level just 10 percent higher than that of its everyday food? To do so would virtually guarantee that Wal-Mart’s version of cheap organic food is not sustainable, at least not in any meaningful sense of that word. To index the price of organic to the price of conventional is to give up, right from the start, on the idea, once enshrined in the organic movement, that food should be priced not high or low but responsibly. As the organic movement has long maintained, cheap industrial food is cheap only because the real costs of producing it are not reflected in the price at the checkout. Rather, those costs are charged to the environment, in the form of soil depletion and pollution (industrial agriculture is now our biggest polluter); to the public purse, in the form of subsidies to conventional commodity farmers; to the public health, in the form of an epidemic of diabetes and obesity that is expected to cost the economy more than $100 billion per year; and to the welfare of the farm- and food-factory workers, not to mention the well-being of the animals we eat. As Wendell Berry once wrote, the motto of our conventional food system — at the center of which stands Wal-Mart, the biggest purveyor of cheap food in America — should be: Cheap at any price!

To say you can sell organic food for 10 percent more than you sell irresponsibly priced food suggests that you don’t really get it — that you plan to bring business-as-usual principles of industrial “efficiency” and “economies of scale” to a system of food production that was supposed to mimic the logic of natural systems rather than that of the factory.

Remember, now, at the moment most people simply can not afford “organic” food. They’re consuming food that’s been sprayed with pesticides and prepared with preservatives to give it a long shelf life. And whatever cost to the environment that comes from these practices is already being borne. So, we’re comparing an ideal–growing foods that yield some health gains to the consumer in addition to various environmental benefits–that does not presently exist at anything but a niche level because of cost against a proposed reality where the health gains are made possible for the masses but without the ancillary environmental gain.

We have already seen what happens when the logic of the factory is applied to organic food production. The industrialization of organic agriculture, which Wal-Mart’s involvement will only deepen, has already given us “organic feedlots” — two words that I never thought would find their way into the same clause. To supply the escalating demand for cheap organic milk, agribusiness companies are setting up 5,000-head dairies, often in the desert. These milking cows never touch a blade of grass, instead spending their days standing around a dry-lot “loafing area” munching organic grain — grain that takes a toll on both the animals’ health (these ruminants evolved to eat grass, after all) and the nutritional value of their milk. But this is the sort of milk (deficient in beta-carotene and the “good fats” — like omega 3’s and C.L.A. — that come from grazing cows on grass) we’re going to see a lot more of in the supermarket as long as Wal-Mart determines to keep organic milk cheap.

But isn’t that how affordable milk is produced now? Why don’t we compare Wal-Martized organic milk to the status quo?

We’re also going to see more organic milk — and organic foods of all kinds — coming from places like New Zealand. The globalization of organic food is already well under way: at Whole Foods you can buy organic asparagus flown in from Argentina, raspberries from Mexico, grass-fed meat from New Zealand. In an era of energy scarcity, the purchase of such products does little to advance the ideal of sustainability that once upon a time animated the organic movement. These foods may contain no pesticides, but they are drenched in petroleum even so.

No, they’re not. They’re merely transported. But don’t we transport goods globally now in consuming non-organic foods?

Whether produced domestically or not, organic meat will increasingly come not from mixed, polyculture farms growing a variety of species (a practice that makes it possible to recycle nutrients between plants and animals) but from ever-bigger Confined Animal Feeding Operations, or CAFO’s, which, apart from using organic feed and abjuring antibiotics, are little different from their conventional counterparts. Yes, the federal organic rules say the animals should have “access to the outdoors,” but in practice this often means providing them with a tiny exercise yard or, in the case of one organic egg producer in New England, a screened-in concrete “porch” — a view of the outdoors. Herein lies one of the deeper paradoxes of practicing organic agriculture on an industrial scale: big, single-species CAFO’s are even more precarious than their conventional cousins, since they can’t use antibiotics to keep the thousands of animals living in close confinement indoors from becoming sick. So organic CAFO-hands (to call them farmhands seems overly generous) keep the free ranging to a minimum and then keep their fingers crossed.

Okay. But how would mass-produced organic meat compare to mass-produced non-organic meat? And, would the niche organic products now available still be available for those willing and able to invest in ensuring that the animals grown to be killed and eaten have enjoyable lives? If so, what’s the harm?

Wal-Mart will buy its organic food from whichever producers can produce it most cheaply, and these will not be the sort of farmers you picture when you hear the word “organic.” Big supermarkets want to do business only with big farmers growing lots of the same thing, not because big monoculture farms are any more efficient (they aren’t) but because it’s easier to buy all your carrots from a single megafarm than to contract with hundreds of smaller growers. The “transaction costs” are lower, even when the price and the quality are the same. This is just one of the many ways in which the logic of industrial capitalism and the logic of biology on a farm come into conflict. At least in the short run, the logic of capitalism usually prevails.

So? What has that to do with healthy food or a healthy environment? Is organic food about a social ideal or about science?

Wal-Mart’s push into the organic market won’t do much for small organic farmers, that seems plain enough. But it may also spell trouble for the big growers it will favor. Wal-Mart has a reputation for driving down prices by squeezing its suppliers, especially after those suppliers have invested heavily to boost production to feed the Wal-Mart maw. Having done that, the supplier will find itself at Wal-Mart’s mercy when the company decides it no longer wants to pay a price that enables the farmer to make a living. When that happens, the notion of responsibly priced food will be sacrificed to the imperatives of survival, and the pressure to cut corners will become irresistible.

As opposed to the status quo, where farmers charge whatever they want, make fabulous incomes, and cut no corners?

I understand the utopian ideals that many advocates of organic foods are pushing and think many of them are worthwhile. They are not, unfortunately, economically sustainable. I shop at Whole Foods several times a week and pay substantially more for groceries than I used to at Safeway and other supermarkets. I don’t do it because of a political agenda but because I think the food, especially the meats, taste better. Fortunately, I live in an area where such options are available to me and where incomes are high enough that I can afford it.

The reality, though, is that most people simply can not afford to pay $3 for a dozen eggs, $6 a pound for chicken, or $15-30 a pound for steak on a regular basis. It’s literally more expensive to buy groceries at Whole Foods and prepare your own meals than to go out to dinner at a chain restaurant like Applebee’s or Ruby Tuesdays. I couldn’t have done that on an assistant professor’s salary in south Alabama even if there was such a store available. Certainly, people working for hourly wages in the service economy couldn’t.

The perfect should not be allowed to become the enemy of the good. In an ideal world, local farmers would produce delicious foods grown without any harm to the environment at prices we could all afford while simultaneously making an excellent living. The livestock would all live happy lives, singing their little animal songs, dying a natural death and yet remaining tender and tasty. We would then get together and cook them over our campfires which produce no smoke, sing our little camp songs, and eat our meals in perfect harmony.

That world, unfortunately, does not exist.

Update:
Joe Carter looks at this story from a socio-economic perspective, through the vehicle of David Brooks’ Bobos in Paradise.

FILED UNDER: Economics and Business, , , ,
James Joyner
About James Joyner
James Joyner is Professor and Department Head of Security Studies at Marine Corps University's Command and Staff College and a nonresident senior fellow at the Scowcroft Center for Strategy and Security at the Atlantic Council. He's a former Army officer and Desert Storm vet. Views expressed here are his own. Follow James on Twitter @DrJJoyner.

Comments

  1. Moe Lane says:

    I’m agnostic on the entire organic food thing, but I can’t help but wonder whether Wal-Mart’s success will actually demonstrate that most organic food is simply overpriced.

    OTOH, this issue has almost religious overtones to a number of people, so perhaps I should just behave. 🙂

  2. Alan Kellogg says:

    Our self appointed elite doesn’t want the common schlub to have the good stuff, so they rationalize barriers to ready access.

  3. my cat says:

    The self-appointed elite in this country is in the leadership of the Republican party or at the head of commpanies with financial ties to the leaders of the Republican party. I don’t know that they have a policy on organic food.

  4. waste22land says:

    And, would the niche organic products now available still be available for those willing and able to invest in ensuring that the animals grown to be killed and eaten have enjoyable lives? If so, what’s the harm?

    When you buy meat from the grocery store, do you ask who the suppliers are? Don’t think so. When Wal-mart starts carrying organic meat (from mono-cultured big feed lot) at a much lower price than Wholefoods (which buys from some small poly-cultured farms), Wholefoods will have the price pressure to source more of their meat from big feed lots. The end result is – the small poly-cultured farms will be driven out of business for their higher cost of maintaining the farm. That is the harm!

    I am all for greater organic product accessibility. But if it means bankrupting farmers and growers who respect the land and respect who “organic” stands for, then I think we are heading the wrong direction.

  5. Maniakes says:

    If people are really willing to pay enough for polyculture farms to be viable, they farmers and their distributors will come up with a new name for the product to distiguish it from ‘Wal-Mart organic’. If they’re smart, they’ll pick something trademarkable.

  6. Bithead says:

    Let’s be honest enough to acknowledge that the only reason organic food never became popular among the elite, was because it was a symbol of the elite.

    Given that everyone else can now afford such, it no longer serves that purpose. Therein lies the backlash against WalMart… and in more than Organic food…. Think about it;

    If the average Joe and Jane can afford to have fairly nice things at a price they can afford, of what value is it to be rich?

    Think about the objection to WalMarts being built in given areas… At any given time Wal-Mart is suffering from the fool’s surrounding any number of give and town boards, city councils, or planning commissions, going over the extra hurdles involved every time Wal-Mart or another low cost retailer wants to go into a particular neighborhood. The reason for all of these extra riddles is simple; The Elite in the area don’t want all those low income types in their neighborhood, even if it’s only for shopping… The mark of a low income neighborhood is to have an affordable store at the middle of it.

    ….or, so the thought process goes. It’s really not all that hard to ferret this stuff out once you understand the basic motivation of people who consider themselves to be “elite”.

  7. TheRich says:

    You guys certainly have a singular view of the “rich”, don’t you? I suppose the idea of becoming rich due to saving and price-checking never entered the mind?

    Perhaps the dilution of benefits of organic produce by a mass-produced supplier won’t be enough to dismantle those who can distunguish themselves from the masses (and those who can seriously discern the difference in flavor from the shiny alternatives).

    Perhaps having even a lesser-organic but much better than pesticide-rich product will actually benefit consumers, “rich” and “non-rich” alike?

  8. Bithead says:

    And if they’re doing as you suggest, how is it they’re snapping up high priced ‘organics’, then?

    Apparently, this is at least one area where price checking and saving is not in force?

  9. anonymous coward says:

    From where does the author think out-of-season food products will come if we insist that all food must be produced and consumed locally? We here in Seattle don’t get all those strawberries and coconuts from equatorial regions in the dead of winter simply because they’re cheaper per pound than the locally grown ones.

  10. Richard Gardner says:

    A little late to the table here, but this author is talking about stuff that Wall Street flailed about, then dismissed 4 months ago. Both Whole Food and United Grocers (major organic distributor) dropped when Wal-Mart made the announcement – at least 4 months ago. Several weeks later, as discussed in the latest Whole Foods conference call, the market realized at organic and places such as Whole Foods are all about the shopping experience, and feeling good about shopping, not the simple “it is organic” stuff. This is in the realm of Virginia Postel, and the “Substance of Style.” Meanwile, I think Walmart’s single store (Dallas area) experiment in the high end will fail because it does not have the cachet.

    The article was also very US-centric is that it avoided all discussion of the European market for organic goods, which is greater than the USA (see German demand for example). For this reason alone, it is very suspect. This article is filler.

    Meanwhile (and disclaimer) as a long-term WFMI shareholder, I must thank James for shopping at Whole Paycheck. Meanwhile, I’ve been buying Copper
    River sockeye at Costco for $10/lb, vs $17 at Whole Foods (We can argue river sources forever, but my taste buds say farm raised is not wild salmon).

  11. James Joyner says:

    Richard:

    Good point on Whole Foods as a shopping experience. I think the same is true of Wegmans, which people simply rave about even though it is mostly an overpriced Safeway.

    I buy a lot of stuff at Costco, including a lot of wine, bottled teas and waters, most of my frozen food, and various other things. I’m not really a seafood person but I’ll mention it to the wife next time we’re there, as she’s a big fan.

  12. Jason says:

    Organic is a marketing gimmick for wal-mart. I have been in the organic sustainability business for many years and we are now at the beginning of two distinctly different organic standards. Wal-mart organics and real organics.

    True quality organics cannot be factory farmed due to the nature and real cost of what it actually takes to succeed with this type of farming. I expect some of wal-marts so called organics to be found from organically grown farms using GMO (genetically modified organisms) crops or farms that were not organic at all.

    Monsanto and Dow have a big presence in South America and other agriculture spots and will likely attempt to manipulate agencies certification wording to get GMO based crops, grown organically labeled as organic. This is only one piece of wal-marts attempt to capitalize on sustainability and organics. You can be certain they will use every gimmick possible for market share regardless of an integrity to true organic farming that they can never own.

  13. Deanna says:

    I wouldn’t eat “Organic Meat” if you paid me to. It is full of parasites because they cannot deworm the animals. Also Dairy cows cannot be dewormed. This smacks of animal cruelty to say the least. There are no proven natural methods of deworming (been there, done that). Since you seem to be well versed on organics, (not confused with “natural” that is sold at Whole Foods), Why would the USDA allow vaccines but not proper deworming? I suspect that livestock owners are doing it and saying they are not. Otherwise the animals would be really sick looking. But I guess if you don’t see them until they are in the meat case……