Evil subsidies: the kingdom of inefficiency

Earlier this year, while making plans for the growing season, we firmly decided we won’t try tomatoes. They’re notoriously hard to grow, sensitive to everything, need loads of water and fertiliser, and are too much of a hassle overall.

But then we took a look at all the space we’d cleared for plant production. We looked at how well all we’d already planted was growing. Ah, [censored word] it, we told ourselves, let’s try tomatoes.

It turned out tomatoes are not that hard to grow. They do need a lot of nutrients, so they do need regular fertilising, but they don’t need as much water as I suspected, and we had a rainy spring this year, so it all worked out rather well.

I’m happy to report that we’re having quite a crop although the tomatoes are looking smaller than they could. I may have underdone the fertilising — a lesson I won’t forget in a hurry. Spot the key word. It starts with an f.

Fertilisers have been instrumental in lifting great numbers of people out of poverty over the last century or so, since synthetic fertilisers were discovered and put into large-scale use.

That has been eloquently detailed by Vaclav Smil in How the World Really Works and many other vocal proponents of rationality and common sense such as one of my favourite Twitter people, Jusper Machogu, who is not just an agricultural engineer but an actual farmer. He should know what he’s talking about, right?

Now, to enable this large-scale use of fertilisers, governments have subsidised the use of fertilisers. Heavily. Too heavily, according to a new World Bank report. This has led to environmental destruction, pollution, and, of course, climate change, so obviously it needs to stop, along with hydrocarbon subsidies and fishery subsidies. What a shocking surprise.

The WB report argues that agricultural — and hydrocarbon — subsidies in most of their current forms are, to quote, wasteful and inefficient, so they need to be “repurposed” with a view to a more productive and efficient way of doing things like energy and food. Another shock, I’m sure.

The report takes 300+ pages to tell us exactly what’s wrong with the current way energy and agriculture are being subsidised, and why we need to change that way by, well, phasing out these subsidies and putting the money to better uses.

Oddly, these better uses are never named explicitly in detail, save for references to things like low-carbon electrification and equality. Or maybe it’s not odd at all. It’s simply a variation on the wind, solar, EVs theme with the new refrain that is fast gathering popularity among decision-makers in some parts of the world that call themselves developed: less consumption. In other words, degrowth.