Potatoes grown in the Dieng Plateau (****) (Photo by Midori on Wikimedia Commons)
Never pay retail. Here’s a good lesson in reductive economics (*), from the Wall Street Journal blog, a grass-roots movement in Greece:
Potato Movement Takes Root as Recession Bites (**)
Angry over food prices that keep rising even as Greece stumbles through a fifth straight year of recession, ordinary Greeks have teamed up with local farmers in a new grass-roots consumer movement to bring potatoes and other basic foodstuffs to market by cutting out the middle men.
The middle men being price-fixing wholesalers and supermarket chains, who enjoyed immense markups from the wholesale price all the way to retail:
The roots of the movement date back to late last year, when farmers in the northern Greek district of Nevrokopi refused to sell their spuds to wholesalers who were paying them 10 euro cents for a kilogram of potatoes at the same time that retailers were charging consumers between 55 and 80 cents — a markup of more than 450%.
After years of recession, giant pay cuts, and harsh economic austerity measure dictated by Greece’s credit “rescuers”, some of the people are giving a collective and indirect middle finger to the system and the state’s value-added tax.
A government proxy, meaning a member of the academic intelligentsia, doesn’t necessarily and predictably see this in a positive light:
Mr. Kyrtsis at the University of Athens has his doubts. “Despite its romantic dimension, the movement cannot last long,” he said. “Greece doesn’t operate in a closed economy, it has certain rules and with this movement, institutions, processes and jobs are bypassed. However, the movement could press for more immediate reforms.”
From the government’s standpoint, these have got to be dangerous enough developments. Why, some folks might bypass the state’s monopoly on currency and create their own. From the Guardian UK:
A couple of hours south, in the port of Volos, an alternative economic model is already up and running. More than 800 townsfolk have signed up for a local currency scheme called TEMs. Teachers, doctors, babysitters, a bookkeeper, farmers and smallholders, a decorator, hairdresser, seamstress and a lawyer are among the members. In the past couple of weeks Theodoros Mavridis, a local electrician, has not had to pay a euro for his eggs, tsipourou (the local brandy), fruit, olives, olive oil, jam, soap, and help in filling out his tax return.
What is a TEM worth? Don’t know, it’s whatever the members say it is. Much like the American Open Currency Standard (AOCS), which has a variety of silver, gold and copper barter medallions designated as “units”. The Ron Paul 1/10th gold ounce is 500 such “units”. Very cool.
The above of course is an extreme example, and predictive comparisons to North America don’t apply much. Greece is not in control of its own currency, having accepted the Euro standard. Living conditions have taken a drastic turn for the worse in the last few years, and no prospect of getting any better. Very little productive industry, or productive people for that matter, seeing how many Greeks work or used to work for the government sector.
For us, we buy try to buy local through a cooperative network, the Oklahoma Food Coop. Farmers and producers have a chance to sell directly to consumers without going through layers of distribution. Less transport costs (and fuel and highway taxes), less labor (and less payroll taxes), less environmental impact, less of everything except quality. In general, the less distance groceries have to travel to get to your table, the better they’ll be, and the less revenue the State collects (***). A win-win all around.
What do you think, readers? Will the potato movement spread, or will it peel away?
(*) Reductive economics… I made this up, but it sounds legit.
(**) Rather good food and potato-related puns in the title. Sadly, no more puns in the body the article. Could have made some more reference to “mashed” or “spud” or “fried”.
(***) and it doesn’t get any closer than your own backyard vegetable garden.
(****) The Dieng Plateau is in Indonesia. Who knew? Well, Wikitravel did.
We also buy local produce of strawberries, blueberries and raspberries whenever we can. We like to pick them up ourselves and see first hand we are getting the best quality out there.
BeatingTheIndex recently posted..Avenex Energy: Dividend Sustainability Analysis and Outlook
Hi BTI – there’s a local U-pick blackberry farm that I swear this year we’re positively going to get to!
Farmers market whenever we can. Cheaper and fresher too and the payment goes straight to those who grew the vegetables!
MoneyCone recently posted..In Pursuit Of The Most Rewarding Rewards Card
Cheaper and fresher is right. Even cheaper if you wait towards the end of the day, when the farmer doesn’t want to bring all the produce back…
Farmers market all the way! And I want to try a CSA too. (Community Supported Agriculture) How silly to buy a tomato shipped halfway around the planet–the definition of unsustainable, no?
Kurt @ Money Counselor recently posted..Tax Deadline Panic Cure
The very definition of it. Very tasteless…
We try to buy from farmer markets and food co op whenever we can. It’s more expensive to buy local, unfortunately.
retirebyforty recently posted..Book Review: Millionaire Teacher
Hi RB40 – We mostly buy local cheese and meats through the coop, and they are slightly higher than the grocery store — but also higher quality.
I might make a return trip or two to the local farmer’s markets this year and do some price comparisons on vegetables. The markets are unfortunately not convenient to where we live. For eggs, we get a great price of $1.50/doz for farm-fresh, straight from the chicken farmer, versus about $3 to $4 for organic eggs from the store.
Do you think the higher prices at the farmers market are due to higher taxes in your state, or maybe local producers aren’t that savvy about pricing their wares at competitive levels?
I do tend to agree. However, for reasons I cannot explain, our farmer’s market is more expensive than Whole Foods. We go and try to buy local as much as we can, but sometimes it is cheaper to go to Whole Foods. Really. It is odd but true.
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Hi Aloysa – the one Whole Foods market we have in town is crazy expensive, plus a pain to get to… I wish I wish we had a Trader Joe’s, but alas…
“Reductive economics”
Man, here I am with my morning coffee and I open up “Cut out the middleman” to see what my pal 101C is up to and, Wham! I get hit with “Reductive economics.”
Ah crap! Reductive economics? I’ve never heard of Reductive economics. How the hell could I have missed something so critical, not to mention so cool sounding…..
I gotta get out more….:)
jlcollinsnh recently posted..Stocks Part 1: There’s a major market crash coming!!!! and Dr. Lo can’t save you.
You heard it here first, JL. All the bogus economics you can stomach…
Farmers markets and buying local is always the way to go, if such a thing is available where you live. As far as Greece goes, the movement may not stick and *may* end up hurting more people than helping, but what the one guy said, “the movement could press for more immediate reforms” is where I think the truth is. Sometimes big movements can’t last because they’re unstable for various reasons, but they often can bring about reform which is the point, right?
TB at BlueCollarWorkman recently posted..The Very First Blue Collar Roundup
Hi TB – in my mind, I was making comparisons with the heady early days of the Tea Party, and how they got co-opted, assimilated and ultimately neutered. Not sure that this Greek thing isn’t too dispersed or even organized to be swayed… a good thing, really. The more local, the better.
Great story and good for the greeks. Always nice to know where your food comes from and save a ton of money too!
Jeff @ Sustainable Life Blog recently posted..Wedding Expenses from the Flip Side
Hi Jeff – glad you liked the story. I was thinking that exact thought the other day in the grocery produce aisle, wondering where those bland Roma tomatoes came from. Probably trucked in all the way from Mexico. I’m targeting mid-June for First Tomato Day.
We buy a lot of local, as I am a zealot about seasonal, local food. My husband was telling me about farms near us where we can go and pick our own berries and pay by the pound (very cheap). That will definitely be a summer project.
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Hi Andi — eating seasonally does ensure good nutrition. Some foods, like carrots, are at their peak right at harvest time, and not weeks after being picked and ripened with ethylene gas.
Our farmers market is also not terribly inexpensive, though I’d rather shop there than my local supermarket any day. Even though we live in an agricultural area our supermarket chains seem to truck in vegetables from someplace two weeks or more away, based on the look and feel of our produce.
I’m in the middle of purchasing my first grass-fed local cow, too. That WILL be much more inexpensive.
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Hi Joe — I wonder the inconsistency in pricing at the local markets is due to farmers not being terribly skilled at pricing and merchandising and customer focus. I’ve read some material on farmer’s markets which talks about exactly this. Some non-business-minded folks may not know how to value their labor, or value it too little. Around here, I can get a dozen organic eggs anywhere from $1 to $4.50 a dozen.
Good luck w/ your beef. Buying a whole or half a beef makes all the sense in the world. I’m in the market right now for half a piggie. Are you going direct or through a coop?
I like your last sentence, very clever.
I’m a regular farmers market shopper and am really looking forward to summer coming and all the sweet fruits for sale. Not everything is cheaper at our local markets, but I still like to support the farmers and the mom and pop vendors. Plus as you said the food gets to the table so much faster cutting out the middle man and it tastes so good fresh! -Sydney
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Hi Sydney — I wish there was an easy way to benchmark nutritional value. Setting aside the taste aspect, supermarket food may be less expensive in nominal terms, but organic delivers a much better nutritional punch.
We always buy our blueberries from a local farmer and our beef from my cousin’s husband’s farm. This year, we are also getting our veggies for 6 months from a local CSA; we also subscribed to their meat CSA. While it wasn’t cheap, I feel better knowing how my food was raised and processed and knowing that it came from a local source.
Melissa@PersonalFinanceJourney recently posted..Tax Day Freebies, April 17, 2012
Have you heard of outstanding in the field?? You’d like I think. Mostly eating farm food, and getting over poured, on the farm.
http://outstandinginthefield.com/
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As many people have commented above, it’s not always cheaper in the U.S. to buy local. It is, however, a great way to support local farmers who work very hard every day to produce food for the rest of the country! Whether it ends up being more or less expensive for the consumer, buying local is a great way to give back and know the quality of food you’re getting!
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