The Economy of Agriculture is our current theme of the year and our working with it will lead up to the next Agriculture Conference 2019. If you mention the subject of economics in farming circles and also to a certain extent in the food sector, then people very quickly find themselves complaining about low prices. A kind of competition often ensues, on tricks to survive best and longest. I realise that on a lot of farms and in many places in the world the situation is so precarious that it is simply a matter of survival. Nonetheless, or especially for that reason, we should, as a biodynamic movement, seek a level of understanding and acting that makes it possible not only to quench the immediate thirst, but also to establish a sustainable and fair economic system.
Moving from Bewilderment to Associations
To begin with, looking into economic life is bewildering because the values and prices are somehow chaotic. Let us mention a few examples: on our farm, the way to the pasture runs along the village street. When we come with the cowherd, the cars have to wait. One neighbour with a fantastic Audi A8 is usually especially impatient. By the time the 25 cows have trotted past, he has nearly exploded and, as soon as the way is clear, his racing start says it all: I don't have any time for folklore, for I am on the road with really big business dealings. It actually is so that he is right in financial terms: all the 25 cows together have an accounting value of 50,000 Franks, and, of course, his Audi A8 is easily worth more. How can it be that a whole herd of cows that represents the mainstay of a biodynamic farm turns out to have less value than a mass-produced car which you can buy all over the world? On the other hand, I am astonished that the new 4-colour printer for the office costs only as much as two whole cheeses. How come such a highly complex piece of equipment is only the price of some litres of milk that has been turned into cheese? Then again, you hear that the whole of agriculture only makes up less than one per cent of the gross domestic product in countries like Switzerland or Luxembourg. How are we supposed to get our heads round it that all over Europe the harvest-ripe grain is standing in the fields and, if it is calculated into the national economies concerned, there is no change at all to the left of the decimal point? Here is another example: the milk price calculation of Emmi, the largest dairy in Switzerland, is so complex for the milk suppliers that a solid grounding in mathematics is required in order to understand how the actual milk price comes about from the three-fold deductions in the region of a tenth of a penny (Rappen), plus differentiated extra charges, minus collection costs, contribution to the co-operative and so on. The result is that the average milk supplier does not know the price. The joke about this is that it does not make any difference if his milk is turned into a high-value product or not. A caffe latte, for instance, is sold for 2 Franks a cup, and there is only 0.045 Franks (= 4.5 Rappen) worth of milk in it. The confusion is complete, when the same farmer receives a generous dividend from Emmi at the end of the year, where he or she is a shareholder via the dairy farmers' co-operative, because the company, which belongs to him to an extent, has made a good profit (N.B. through the low milk price).
Everyone can add to these examples from their own experience. It is obvious: it is anything but simple to see through the economic life. This does not reflect on our simple farmers' minds, for the same goes for everyone. The interactions are so manifold and multi-layered that it requires the input of many players to form a sound judgement for steering the economy. Rudolf Steiner called for such platforms and called them associations. What is needed is the constant observation of economic events and fluctuations and adjusting prices accordingly. An association is not a fixed social form, but rather a principle that can be realised in completely diverse ways, small or big, for a product or whole branches, for consumer goods or items of capital expenditure etc. What is important, is to bring the perspective of each entrepreneur into the common overview, to see and accept consumption as a regulatory factor, alongside production and trade, and to see economic life as a part and not as the whole of social life.
Agriculture and the Economic Workings of Capital
In the "National Economy Course" of 1922, Rudolf Steiner dealt with economic questions in general, using a scientific approach. In it, he reaches far-reaching insights and conclusions, which are exciting, because he consistently takes the spiritual faculties of the human being and the spiritual dimension of the world into account. The reality of the spirit, however, does not lead him to abandon economics, but rather it leads to a much deeper approach to economics that sees and handles the material realities – land, capital and means of production - in a new way.
Right at the start of his remarks, Steiner sets an axiom that has a direct connection to agriculture. He develops this with the idea that there are two kinds of economic value creation:
1. Labour is expended on nature. W1 = work on nature. This goes to say that only the working upon nature that is directed towards needs creates economic value. Nature itself does not belong to economics, only nature that has been worked upon. Now, this is the position of agriculture in economics, it works on nature directly. Dealing with soil, plants, and animals is the beginning of economic life.
2. The mind is applied to work. W2 = mind on work. Thus, the organisation of work is referred to. For instance, instead of each person going to work by themselves, one person picks up colleagues in a wagon or vehicle. At the final count it is advantageous for everyone and, taken to its conclusion, means the one becomes the founder of a transport company and the others commuters. The spirit of modern life has been to get rid of all traditional and religious norms and to instead organise work life in a purely rationalised way. Industry came about, and we are just now in the fourth industrial revolution, in the transition from digitalisation to robotics. In and through this form of economics based on the division of labour capital arises.
Thus we come to a contrast or polarity between agriculture and industry. Agriculture is based on nature, whereas industry leads to capital. This is not to be seen in moral terms; they are simply both there. The question is only how economic life can now function without industry completely suppressing agriculture, or rather, agriculture becoming completely industrialised. One can just as well ask why it should not be so? What sort of reasons are there not to subject agriculture to a thorough rationalisation process? You cannot answer this question with your head, you have to look at reality. Then you will see that it simply does not work. On the one hand, nature is being destroyed as the basis of life – I remember the example of the apocalyptic pictures of the completely dried up Lake Aral, which are just now circulating around the world again. This devastation is the result of the planned economic management of cotton production, that is, the result of industrial farming. On the other hand, industrial food and nutrition do not work out – for example, industrially produced foods lead to obesity, from which about 1 billion people are suffering.
Associative Zones
Agriculture is then well advised to care for nature, on which it is based, to such an extent that added value can be created in the long term. And it is well advised to produce foods that can be digested as well as possible. It can achieve these two guidelines, which are simply economically sensible guidelines, well, if it is organised in such a way that it forms production units, which are able, of themselves, to provide the right measure of product quality and quantity for society. We call such a production unit the agricultural organism. In fact, out of insight and experience, it is an organism and not a mechanism. And this way of producing – which is only slightly organised according to rational maxims – requires and fosters a corresponding form of economics for the transfer of its produce into the economic cycle. The agricultural organism cannot exist, if it is condemned to produce anonymous raw materials for the futures market. Whether the farm be large or small, whether its produce be food or textile fibres, whether it be equipped with a lot of capital, as in the North, or else with scarcely any capital, as in the global South - it requires associative economics, which accommodates it. At the same time, it fosters this kind of economic working, because for all its economic partners it makes its natural basis plain to see and an economic matter of fact, an obvious part of the price structuring. We have called this deliberate development of mutually respecting economic areas around a farm or for a whole region associative zones. This makes a statement that we want to and are able to build safety zones for a new, associative way of economic working into the wilderness of the market economy. The Agricultural Conference is meant to convey comprehensive pictures from such inspiring examples and instil the courage to nurture and propagate such tender seedlings.
Agriculture as a Ferment for Economics with a Human Face
In the 13th and 14th lectures, towards the end of "Rethinking Economics" (GA 340), Steiner puts the question of how the value creation of "cultural workers", teachers, priests, civil servants etc. can actually be related to farm work, from which we are indeed all fed. How many priests, teachers, painters, speculators and so on can live in an economic system before it nosedives? The answer is relatively straightforward: everyone has to have something to eat and this food comes from the soil. In other words, the total of all values of an economy must be in relation to the fertile soil, according to the formula: the area of the economy divided by the number of people. In terms of the world economy, the total of farmed land divided by the number of all the inhabitants of the earth. The productive value of such an average area per person can be worked out. For a farm, the figures are graspable, for most economies too, for the world economy one can estimate them. This figure, for example, 5,000 Franks agricultural gross proceeds per hectare for Switzerland, is the measure for all other economic values. If the overall economic value of an economy completely loses its relationship to this basic measure, then, as a whole, it enters into a deficit balance, it uses up values that it actually does not have. You can also say this economy is making debts; or else, it is not sustainable. The modern economy has this weakness; it is not sustainable, let alone capable of making provision for the future. This is most noticeable with the overexploitation that it subjects nature to. We know loads about this massive ecological footprint, it is well documented. However, the exploitation takes place socially as well, and also culturally and spiritually and in many dimensions; just there it is not so well documented. The ecological dimension affects us particularly, for farming work is done just where economics and nature meet. I believe that this is the reason why today there is a kind of hypersensitivity regarding agriculture and nutrition. In Switzerland we currently have five petitions for a referendum pending, on which we all have to vote: the Fair Food Initiative, the Drinking Water Initiative, the Pesticide Ban Initiative, the Food Sovereignty Initiative and the Horned Cow Initiative… A lot of societal issues are connected with agriculture, and the poor farmers, who milk their cows and make their hay without complaining, no longer understand what all the fuss is about.
Yes, indeed, what is all the fuss about? Why do so many groups in society want to pull agriculture in this direction or that? In my opinion, it is not a matter of agriculture in the narrower sense: a lot of people sense today that our values, especially the economic values, are hollow, meaningless. And this uneasy feeling in their lives, which is not even so much as a clear realisation – and each of us is caught up every day in the mill of economic necessities up to our ears– finds a kind of projection surface in agriculture. We sense that farmers have a kind of guardian function in relation to nature, to creation or simply to the dimension of being that is not fully within our grasp or power. It is a concern for and yearning for what is unavailable that moves us inwardly. And this feeling is not mistaken, indeed, as a feeling, it is quite right. Transposed into thought form, it could be formulated simply by saying: life should not belong to the economy, but rather the economy should serve life.
From this perspective, agriculture is not the victim of the fully rationalised economy, wretchedly struggling for its survival, and yet increasingly marginalised. Rather it is the sensitive place in society, where the imbalance becomes noticeable that a usurping economy presses onto the life of society as a whole. It is not the victim, rather it offers the possibility of coming to ourselves and to rethink matters. Perhaps comparable to an ancient tragedy in the Greek polis (city state). Agriculture holds up a mirror to us as a society in the sign of homo economicus, into which we look, full of fascination, with a mixture of self-admiration and abhorrence. How can we find a way between our lost innocence as creatures of nature and the hubris of self- and world-destruction through the addiction to profit?
Agriculture comes into focus here as an inner attitude which is not new, but which needs to be renewed in every period of time. And here we gain a viewpoint, with which, on the one hand, the cultivation is carried out, directed at nature, and, on the other hand, directed towards the social organism with economic behaviour that does not usurp but cultivates. In this sense, associative economics - and also other approaches to economics that go in this direction – may be seen as the possibility which can bring good measure and meaning into our economic activity. And this circumspect way of handling economics that takes account of the whole picture has an especially favourable soil in agriculture. Rudolf Steiner stipulates this when he calls for the whole value creation in economics to be related to the yield capacity of the soil.
Should the thoughts formulated here correspond to a layer of reality in society, then they might throw a light on our theme which we could develop much further in the conference: Economics of Agriculture. This would equate a focus on a humane economy. And then we do not only need to complain and to demand fair prices, but we have something to develop and to give that could act like a ferment for society and the economy as a whole.
Ueli Hurter