China's Bitter Harvest


The Wall Street Journal

It is perhaps the mark of a mature democracy that it can adopt environmentalism and entertain, and even survive, long debates over the effect of drilling for oil on caribou or last week's appeals court ruling that logging in Oregon must stop because the government hasn't fully analyzed its effect on salmon runs. When environmentalism tips into a craze, strong democracies can often count on popular common sense to resist. But there's no defense when a totalitarian government grabs a bad idea, as we are now witnessing in China.
Several parts of north China are experiencing a drought this year, meaning that crops are in danger of failing and unusually big dust storms have already blown across the landscape. This has provided Lester Brown, modern-day Malthusian prophet, just the opening he needs to rehash his theory that China faces a future grain shortage which will drive up world prices for food. When Mr. Brown talks about an environmental catastrophe in China he is on the mark. But part of the reason for that catastrophe is a damaging government policy inspired by his own predictions.
Let's back up to 1994, when Mr. Brown and his environmentalist Worldwatch Institute brought out first an article and then a booklet entitled "Who Will Feed China?" Both argued that the answer to this question is nobody, due to a host of reasons. A major one is an outsized Chinese population that will grow for some years yet, despite the one-child policy. The book played into the hands of leaders who wanted to restore strict state control over agriculture and avoid dependence on foreign sellers of grain, and so the State Council invited Mr. Brown to lecture in Beijing. The message they evidently took away was that China should start maximizing production in order to head off catastrophe.
So that's what Beijing set out to do. Its chief tool was the price that grain purchasing bureaus paid farmers for their grain. By nearly doubling this price, Beijing spurred bumper harvests over the following few years. But the policy succeeded too well. The cost of storing unneeded grain soared. That grain then started to rot in the granaries. The policy also sowed the seeds for another economic disaster down the road. The increase in prices caused farmers to bring marginal land under cultivation, and encouraged more people to work on it. This hurt agricultural productivity, which actually had been growing in previous years even though official statistics obscured the fact. The economic dislocations make a sudden decline in rural incomes unavoidable once China enters the World Trade Organization, something that now has Beijing worried and is reportedly holding up the final negotiations on accession.
Meanwhile all that extra land that is being cultivated for no reason is doing damage to China's natural environment. As American farmers discovered in the 1930s, the best way to combat dust storms that whip away valuable topsoil is to plant tree breaks. Allowing marginal farmland to return to its natural state heals the watershed and replenishes aquifers. Beijing has tried to prevent illegal logging and has planted trees, but it is fighting an uphill battle against forces it created by raising its price for grain above the world market price.
Mr. Brown, however, perversely takes the signs of ecological stress as more evidence that his doomsday hypothesis is correct. Apparently he still believes that Chinese people, in particular the richer, meat-eating ones, are going to eat the rest of the world out of house and home. Well, everybody can relax. Mr. Brown has been making these kinds of predictions for three decades, and technology has time and again proven them wrong. Moreover, if the market ruled, China probably would import more food, but not an outlandish amount. Given the right reforms there is plenty of room for its own farms to become more efficient. The biggest obstacles now are small plot sizes, low investment levels and inadequate distribution infrastructure. A free market in land would make it possible to create larger farms that would invest in improving the land, buying better seeds and fertilizer, and mechanizing the whole process.
But for now China seems determined to press on with its policy of grain overproduction. As a result, it is reaping a bitter harvest, both economically and ecologically. China's best defense against famine is not ramping up grain production at any cost, but enmeshing its agricultural sector with the world market. Beijing would be better off using the Worldwatch Institute reports as fertilizer rather than reading material. And Beijing would be best off if it recognized that this is precisely the sort of serious damage that a democratic people will ultimately recognize and reverse.