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International Agreements

International agreements are all over the news recently.  The trade agreement between Canada and the EU is almost completed.  Canada and China are beginning talks that will lead to a trade agreement between them.  The US is negotiating a trade agreement with the EU.  The TTP is coming.  It’s a multi-lateral agreement between the US and many Asian countries that are friendly with the US.  China is notably absent from this agreement.  NAFTA, a trade agreement negotiated many years ago between Canada, the US, and Mexico, has been the subject of complaints recently.  What’s going on?

I’m in favour of free trade between countries, at least in principle.  I also oppose tariff barriers and subsidies, in principle, because they constitute unfair competition between countries.

Did you notice that the recent agreements are not called free trade agreements, but just trade agreements.  That’s because they sometimes restrict trade, rather than make it more free.  One thing that western countries try to do is to spread their intellectual property laws (patent, copyright, and trademark laws) to other countries.  These laws often grant monopoly powers to companies that hold these properties.  As well, trade agreements may preserve subsidies or preserve import quotas on certain products.  This is not free trade in all aspects, but does facilitate trade between countries.

One feature of trade agreements that’s new to me is that they are negotiated in secret.  Why is this?  What are they trying to hide?  The problem with secret agreements is that many people will be dissatisfied with them when they are finally made public, but by then it’s too late to change anything.  The news media can only speculate about what one country had to give up while negotiations are in progress.  I have no doubt that ordinary people understand that their country must have both gains and losses in such an international agreement.  Even then, the agreement must benefit the majority of the people.  If it doesn’t, there will be a great deal of opposition within the country.  Secrecy is not appropriate for such an important undertaking.

Will there be job losses?  Of course.  There have always been job losses.  Companies always seek to reduce labour costs.  Unrelated to trade agreements, they have introduced automation, division of labour, and self-service to reduce their labour costs.  They had to do this to remain competitive with other companies.  With trade agreements, products are often made in other countries where labour costs are lower.  Even some services can now be done in other countries.  This is bound to happen.

Of course, trade agreements lead to globalization.  Globalization can be an excuse for economic domination by one country.  People in one region of a country, or in an entire country, can see it as something imposed on them by some other country.  It can be Americization or Westernization.  Trade agreements have to prevent economic domination by one of the parties to the agreement.

It’s also important to maintain the national identity of each country.  This requires exceptions to the general rule of free trade.  In particular, local culture must be protected.  Cultural industries must be protected.  National policies must be respected by trade agreements.

Recent trade agreements allow legal action by producers in one country against restrictions imposed by another country.  Of course, this can be an enforcement mechanism for the agreement.  It can also be misused to break down national policies such as protection of the environment.  Such things that need to be protected have to be part of the agreement.  Then, special courts can be fair in the face of legal actions.

Yes, trade agreements can be beneficial to all countries involved, and to people in regions within those countries.  Negotiating such an agreement requires that people take on the viewpoint of another country, and do this as friends and not as adversaries.  This is not an easy thing to do.  I can understand why negotiations may go on for years in many cases.

 

A Healthy Diet

I recently read an article on the Mediterranean diet.  The upshot of it is: the Mediterranean diet doesn’t exist.  It’s what people in the Mediterranean region ate 100 years ago.  Now they eat the same food that everybody in western countries eats.  The Mediterranean diet is only something that people can aspire to now.  The article states that it consisted mainly of a great deal of vegetables with very little red meat.  The food was served in several courses, but in small portions each time.  We don’t eat that way anymore.

I also read about the famous chef Escoffier recently.  He brought flavour to food, with sauces and gravies, and serving food hot.  He also served food in many courses.  People didn’t feel stuffed at the end of a meal because each course had small portions.  We don’t eat that way anymore either.

A couple of years ago, I read about a new restaurant chain moving into this city.  It was in the business news.  It said that this restaurant chain competed in the market for large portions of food at reasonable prices.  I have eaten there a few times.  The food is good, but the portions are indeed enormous.

What is it about portion size anyway?  I have a limited capacity for food.  I don’t like to feel stuffed.  Consequently, I prefer small portions.  I also try to eat everything on my plate.  I order from the senior’s menu if the restaurant has one.  Often it’s impossible for me to find something small enough.  I know that people in my group often groan when they see how large the portions are.  I know that some of them order from the appetizer menu.  Don’t these places know what people want?  Don’t they know that eating too much is the main cause of obesity.

Courses too seem to have disappeared, at least courses in the style of the Mediterranean diet, or in the style of Escoffier.  Now the whole thing comes on one large plate.  Doing it that way is easier on the kitchen staff.  Serving an entire meal, exclusive of appetizer and desert courses, on a single plate seems to have become the norm.  I know that upscale restaurants do serve food in courses, but I’m reluctant to try them now because I’m sure I’d be way too full.

Why are portions so large?  Clearly it’s because that’s what many people expect.  I suppose they want good value for their money, and only feel they are getting that when they are served that much food.  No doubt some people eat it all too.  I certainly couldn’t do that, and would not want to be able to do that.

The only place, outside of my home, where I’ve seen small portions of food served is at my parent’s senior’s home.  The soup comes in a tiny bowl that’s only slightly larger than the soup spoon.  When you ask for eggs at breakfast, you get one egg.  Their sandwiches are thin enough to actually fit in your mouth.  These portions are perfect for the people who live there because most of them are quite inactive.  Indeed, many of them ask for half portions at meal times.  You can also ask for double portions, although I’ve never seen people do that.

Why can’t restaurants serve small portions too?  The food may look wonderful.  It may be full of flavour.  I may even enjoy eating it, but my impression is spoiled by the feeling that I’ve eaten too much.

 

The American Dream

I was just reading an article about the Great Paradox in American politics.  The article described Louisiana as the most polluted state in the US.  It illustrated the paradox by questioning why both ordinary people there and companies operating there are supporting Donald Trump.  After all, these companies polluted the land and water of the state, and mistreated their workers at the same time.  One of the reasons for the paradox was that ordinary people saw the federal government, particularly the EPA in this case, as a foreign organization, one that only causes trouble for them.  The other reason was that these people still believed in the American dream, and found any attempt to take that away from them as unfair treatment.

The dream was that anyone could make a better life for themselves and their children simply by working hard.  They could do this without help from anyone else.  They could make a million dollars, or even a billion dollars, just through their own efforts.  Many successful people have claimed that they did it all themselves, often by starting a business.  I once read that ordinary Americans voted against higher taxes for the rich because they all believed they would be rich one day.  This is clearly impossible.  They can’t all become rich.  More than 99% of them will stay the way they were.  Only a very few of them can become rich.  It’s like buying lottery tickets all of your life, in the expectation that one day you will win.  You read about lottery winners all the time, but it’s never you.  The odds of you winning the lottery are still vanishingly small, just like the odds of being successful in the American dream.

I recently read a biography of Ben Franklin.  He was an advocate of the American dream, and used himself as an example.  He was a printer.  He made his fortune by operating a print shop in Philadelphia.  He said that everybody should do that.  Of course, he had the only print shop in Philadelphia.  He had no competition in that business.  I don’t know how many people there were in Philadelphia at the time.  Let’s say 10,000.  That makes him not 1% but 0.01% of the population.  Clearly it would be impossible that everyone could do the same as he did.  The vast majority of people have to be employees.  Only a very few can become successful in a business like Ben Franklin did.

We have the same paradox with the fisheries in Canada.  It’s easy to understand.  Whenever fish stocks are threatened by over fishing, scientists at the Fisheries Department recommend closing the fishery to allow stocks to recover.  People in the fishing industry will lose their jobs if the fishery closes.  In that situation, officials in the Fisheries Department have always disregarded their own scientists and chosen to preserve jobs instead.  Environmentalists outside of the region have been shocked at the decision.  Which is right?  Do we preserve jobs?  Do we preserve a way of life?  Do we destroy these things to preserve the fish instead?  Maybe there is no right decision in this case.

 

I’ll Eat When I’m Hungry

There’s an old song that says:

I’ll eat when I’m hungry,
I’ll drink when I’m dry,
If hard times don’t kill me,
I’ll live till I die.

Is this still a good idea?  Can we still rely on bodily sensations to know when we should drink and when we should eat?  How do these sensations work anyway?

In the case of thirst, it’s all pretty simple.  Our brain monitors our blood to determine if it’s too thick or two salty, meaning that it needs to be diluted with water.  If it does, the brain produces the sensation of thirst.  As soon as we drink water, our brain anticipates that this water will pass through our stomach into our intestine, and will eventually enter our blood stream.  It reacts by cancelling the sensation of thirst, even before the water has diluted our blood.  Of course, we can also use our intelligence or our will power to drink water before we need it, or to postpone drinking water to a more convenient time.

No doubt we have similar mechanisms in the case of hunger, but the situation is more complex.  The sole cause of obesity is eating too much food, but there are many reasons why we do this.  It only takes a small amount of excess food because the excess accumulates over time.  Unfortunately, it’s really easy to eat a bit too much, but it’s quite difficult to work it off through exercise.  Exercise is good for us, but it can’t compensate for over-eating.

Some people do feel hungry all of the time.  This feeling may have a genetic basis, as it does in this study of Labrador retrievers.  Pet dogs, of course, are entirely dependant on their owners for food.  Generally, dog owners will regulate the amount of food their dog gets in order to maintain their dog at a healthy weight.  You may have to do the same thing for yourself if you are one who feels hungry all the time.

There’s a recently-discovered factor in obesity: colon bacteria.  Their exact role is confusing, probably because scientific studies are still revealing more questions than answers.  We don’t know, for example, if colon bacteria types are a cause of obesity, or a result of obesity.  At the moment, there’s no magic potion that a person can take to lose weight.

People often amused at my interest in obesity.  After all, I’m thin, not fat.  That’s not quite true.  I do look thin, but that’s an illusion.  I only look that way because I’m tall.  I actually have a normal amount of body fat.  I’d like to keep it that way.  I also have a low capacity for food, and seldom feel hungry.  Both of these factors are a big help.  Still, I have to be careful with how much I eat, or I will put on weight.  Mainly though, I’m interested in how the human body works, and how the mind works along with the body.

 

Desert Rose Inn

On my recent trip to southern Utah, I was fascinated by the desert.  It was something I’d never seen in my home province.  It was wide stretches of sand, punctuated by bushes in clumps.  I learned that the bushes were sage, creosote bush, or Mormon tea.  I’d heard of sage and creosote bush in western movies.  Mormon tea was new to me.  There were small settlements in some of the valleys.  Even if the stream flow was intermittent, they could get water from wells near the stream bed.  I even saw patches of irrigated land in the valleys.

There was open-range cattle ranching in the desert itself, even though there was little grass for the cattle to eat, and no water at all.  The ranchers hauled water to fill watering troughs near where their cattle were grazing.  That has to be marginal farming.

Of course, I know that it takes more than sand to make a desert.  It’s really low rainfall that does it.  We have sandy areas that we often call deserts, but the rainfall there is the same as in surrounding areas.  These are not real deserts.  The ones in Utah certainly were.

One of the places we stayed in Utah was the Desert Rose Inn.  It’s all by itself, out in the desert.  There were flowers blooming there, just like the name implies.  It was a first-class motel.  I noticed, though, that sand had drifted and collected along one side of a curb.  I also noticed that all the flower beds were filled with sand, and that the sand had blown away from one area, leaving landscape fabric exposed.  It must be very dry there.  The sand must blow around quite easily.

There was a marsh off to one side of the building, with a trail leading to the marsh.  When I walked through there, I found plenty of dry vegetation, plenty of bird life, but no open water.  The next morning, while I was waiting for the restaurant to open for breakfast, I noticed water spraying in each of the flower beds.  Every plant had its own spray head, fed by fine irrigation tubing.  The water was pumped from a well on the side of the property towards the marsh.  One of the spray heads was not working, probably because it was plugged up.  The plant next to it was dead and dried out.  I suppose that it only took a day or two without water for the plant to die.  How artificial, I thought.

In fact, the whole place is artificial.  Water is only one requirement.  The other, even more important, is electrical power.  Without those, there couldn’t be such a beautiful place out in the Utah desert.

 

Marketing Boards

Our marketing boards have been in the news recently.  Manitoba has just opted out of the Freshwater Fish Marketing corporation.  Not too long ago, we disbanded the Canadian Wheat Board.  Trade deals, one with the EU and the other with a group of Pacific nations, have threatened our system of marketing boards.

When I went to high school, we learned basic economics, and in particular about the concept of perfect competition.  This took place in a market of many small producers, where the products were identical.  Consumers were free to choose the product that sold for the lowest price.  The result of this intense competition was to drive down prices to the point where producers were making no profit, but just breaking even on their enterprise.  All of the agricultural products fell into this category, as did fisheries products.  Government grading ensured the products were identical.

A free market doesn’t work very well in a situation of perfect competition.  The consumer is pleased because of the low prices, meaning cheap food for them.  Producers, on the other hand, are desperate because they can’t make a living selling their products.  Something has to be done to protect the producers.  Governments have tried to solve this problem in many ways.

The Canadian solution has been supply-side management.  The principle is to restrict the supply of a product so that prices will rise to the point where producers can make a profit.  Governments do this by assigning production quotas to each producer, typically a farmer or a fisher, and by tight control of the market.  They have to prevent imports of those products from outside of their region, to maintain this control.

Producers are generally happy under supply-side management, although they often want to produce more than their quota allows.  The quota itself acquires a monetary value: it can be bought or sold, or inherited from parents.  Consumers are less happy, because they are paying higher prices.  Producers outside of the region, as well as potential producers without quota, don’t like the system at all.  The marketing board must set prices, and adjust quotas to maintain these prices.  This is a form of central control, something that’s detested by people who advocate free trade.

The European solution has been to subsidize the producer.  This seems to be the American solution as well.  Under this system, the producers are generally satisfied.  However, they tend to over-produce, driving down prices.  Consumers are satisfied too, because of the cheap food.  Governments are the losers here: they have to keep paying the producers.  Taxes will be higher, taxes paid mostly by the consumers.  Maybe if the prices were higher, the subsidy would not be required.  The question is: how can this be accomplished?

When prices are too low because too much of a product is on the market, one solution is for government to buy up the surplus product.  European governments have tried this strategy in the past.  Some of them accumulated a mountain of butter.  The problem they faced was what to do with the surplus, something that would not drive down the price again.  They couldn’t just destroy it.  Destruction of food just isn’t done these days.  They couldn’t sell it on the international market.  They’d be accused of dumping if they did that.  About all they could do was to give it away, either to other countries as foreign aid, or to poor people within their country.  The big problem was that governments had to keep buying and storing the product.  Doing this was expensive, and could not be justified year after year.

Of course, many things have changed since these strategies were first introduced.  For one, products are no longer identical.  Certification, usually by private organizations, has changed the market by inventing new categories.  Some grain is now organic.  Some eggs are now free-range.  Distributers are using branding and marketing to differentiate their products from other similar products.

So, what’s the solution to the problem of perfect competition?  Supply-side management does work, but it has problems too.  One is that it can’t coexist with other solutions that demand open markets.  Subsidies also work, but also have problems.  Subsidies compromise the idea of a free market, for example.  Buying up the surplus seems not to work, at least in the long run.  Distributors that have a monopoly, like the Fish Marketing corporation or the Wheat Board, and that don’t have full control of the market seem to be of no economic benefit.  They should be replaced by a group of distributors that compete with each other.  To some extent, the problem is solving itself.  To some extent, it requires judicious government intervention, of a type that’s acceptable to other governments.

 

Sports Drinks

I got started on this topic because of an article in the Washington Post.  It was reprinted in the National Post, where I read it.  I must say that I agree with much of what the author had to say in the article.  Certainly, elite athletes, the ones who do hard physical work and sweat profusely, are a very small market.  Certainly, the companies are selling their product into a wider market.  Certainly, they add sugar, flavour, and colour to appeal to this market.  In particular, they bring the sweetness of their sports drinks up to the optimum level to make them most appealing to their customers.  People who are not elite athletes could get what they need by drinking plain water, instead of the sports drinks.

I do have doubts about some parts of the article.  As far as I know, the idea that artificial sweeteners are harmful to your health is only a suggestion right now, with no scientific evidence to back it up.  Similarly, the idea that natural products are healthy and artificial products are unhealthy may turn out to be a false idea, even though many people seem to believe it.  Of course, natural is now a marketing term too.

The factual information contained in this article makes me wonder how companies can make money selling sports drinks.  I suppose, in the wider market, they are just another beverage, like carbonated drinks, like fruit juice.  Companies must use marketing to create demand for their products, although they must also be sensitive to what their customers really want.  They have to compete with other companies who are selling similar products.  In this sort of market, it’s the product that’s most appealing to customers that wins the most market share.

That necessity explains why all of these beverages contain large amounts of sugar, or the equivalent in artificial sweetener.  One company is not going to reduce the sweetness of their products because they will lose their popularity with their customers.  No doubt we all know that sugar is the new culprit in obesity.  In this respect, beverage companies are similar to tobacco companies, although the effects of sugar consumption are not as bad as those of tobacco consumption.  Maybe it will take government regulation to make sports drinks less sweet.

Still, how can the companies make a profit without taking a toll on our health.  Their traditional way was through advertizing and high sweetness levels.  They claim that they can’t make a profit selling water.  There’s nothing in water but water.  All water is essentially the same.  Water is what we need, but there’s no profit in it.  I don’t see a future for the beverage companies, at least in North America.