Relying On Mega Corporations

While reading Windup Girl, AgriGen brought me to consider examples of corporations and industries that are large market and political actors. I thought about monopolies or near monopolies that exist in the United States, and realized their influence over our government and economies is just as real. Monopolies have their obvious issues like price setting and quantity control, but they also act in ways that cripple economies and governments.

            In a perfectly competitive market, if one seller shuts down, goes bankrupt, or leaves the market for whatever reason, other sellers make up for the production. But when a seller has too much power, its collapse causes a tidal wave that cripples the buyers. With GMOs, agribusinesses get entire farming markets in their pocket by creating higher yield seeds that need to be purchased annually. The kicker is that the designers of the seeds have a monopoly on the product because their patents last longer than the seeds are produced: the company designs new seeds before other companies can use them. This means that when Monsanto comes out with a new genetically modified cottonseed, farmers need to buy it to stay competitive, and Monsanto is essentially the only store selling it.

            It is easy to imagine the world of AgriGen and PurCal becoming a reality. Certain agricultural products in the United States are produced by a majority of GM seeds, such as cotton, corn, and soy. Imagine that a large producer of GM corn hits a speed bump, maybe it goes down like Enron, or is responsible for a disaster like BP and Haliburton. Then all of a sudden farmers cannot get their GM corn seeds because the floundering Monsanto either went bankrupt or had to downsize or could not produce the seed this year for whatever reason. But there is already an established reliance on the corn. So the farmers can grow unmodified corn, but as a result the plants yield much less product. What happens next? One of the most relied on crops in the world is absent from grocery stores. Pigs and cows go unfed and now there is less red meat. Staples like tortillas, and comfort foods like popcorn and chips are not available, because what little corn that is produced is fed to the pigs and cows so Americans can have there beef jerky and pork rinds. Probably the most important side effect is the shortage of whiskey, arguably in some respects the backbone of society. Quite frankly, I fear the immense effect orchestrated disasters could have coming from the many monopolies of firms and industries that exist in many places.

            This scenario could come from electricity providers, which typically have an outright monopoly in a region. Pepco could flip a switch and make the capital of the free world go dark. Water providers, trash collectors, even airport operators in some places have local monopolies. Bacigalupi presents an extreme case, as I am rather sure Monsanto does not have hit men, but his concerns are real. What I got most out of Windup Girl is the possible outcome of our society relying on a few mega corporations and giving them enough leverage that the consequences from there actions hit everywhere. Maybe the result is that like Anderson, people have difficulty finding a good piece of fruit. Personally, I am more concerned over the stability of the production of beef jerky, pork rinds, and whiskey.