It feels like a lifetime ago but in reality it was just over four years ago since the then Prime Minister Boris Johnson gave a speech at the Old Royal Naval College in Greenwich on how free trade had made the UK incredibly wealthy in the past and how it could do so again. While I was no fan of Johnson and the majority of his speech was just empty rhetoric, there were reasons to be optimistic. Covid hadn’t really become a major issue in the country at the time and – while the future trading relationship with the EU was far from settled – the 2019 General Election which gave the Conservatives a large majority in Parliament meant that it seemed that the instability and inertia that had plagued politics for so long might finally be over. On a personal note, I was excited as I had been offered a role as an adviser to Liz Truss who was then the International Trade Secretary and so I was looking forward to getting started, especially given the prominence that international trade looked set to enjoy and backed by a Prime Minister who seemed to believe in free trade.
Fast forward to June 2024. The Conservative government is in its death throes and is almost certainly going to be wiped out on July 4th. Perhaps this is why it has chosen to revert back to its old position of mercantilism and opposition to free trade.
Last week we saw two tweets on this from the Conservative. In the first (which I actually thought was a parody to start with), the Prime Minister stated that ‘We shouldn’t be reliant on foreign food. Buy British’. In the second, the official account of the Conservatives had an image warning that Labour would threaten the country’s food security, complete with a picture of a carton of eggs with the branding ‘Not laid in the UK’.
These are monumentally stupid statements from someone as clever as Rishi Sunak and completely ingenuous from someone who claims that Margaret Thatcher is one of his heroes. However, it is a sentiment that is shared by a significant proportion of the population as fears over food insecurity are stoked by the media and powerful lobby groups such as the NFU. As such, hardly a week seems to go by that we don’t have a politician, tabloid, or celebrity chef cry that we need to become self-sufficient in food.
The UK has not been truly self-sufficient in food since the early 19th Century and that is when Brits subsisted on a diet mainly of bread, dried fish, and bacon fat (interestingly, the average Irish peasant ate 14 pounds of potatoes washed down with three pints of butter-milk every day before the Great Famine). It was a miserable diet and wholly inadequate to meet the country’s dietary needs. Calling for self-sufficiency is to impoverish the nation and return the country to a life of toil and subsistence.
Now, I imagine this is not what Sunak and others mean by this. They would probably argue that we should attempt to produce more and different types of food in the UK. This is frankly a bonkers ambition to aim for and completely unachievable and unsustainable. The country currently imports over 40 per cent of its food and so replacing that with domestic produce would be a huge task. It would mean using more and more land in an inefficient way for farming. It would be expensive, environmentally damaging, further hinder economic growth, and almost certainly wouldn’t work.
Self-sufficiency would mean that living standards would stagnate even further due to the inefficient use of land which could instead be used to build homes, transport infrastructure, solar farms, and other productivity enhancing things. Not only would this hit wages, whatever meagre pay that people would receive would then mainly have to go on food and housing as the higher production costs would be passed onto consumers in the form of higher prices while housing would be even more scarce, thereby pushing up the price of rents. This is already a problem in the UK and so self-sufficiency would make things even worse.
Aiming for self-sufficiency would also be deeply damaging for other industries. This is always the case with protectionism where measures are introduced to protect one industry, others tend to suffer. It was the same with the Corn Laws which saw wealthy landowners benefit while poor people suffered and other sectors of the economy were held back as the population had little to no disposable income to spend on other goods. It would also mean waving goodbye to the prospect of striking any future trade deals. Given that opening our market to foreign agricultural producers is always a condition of trade negotiations, there is no way that any country would allow us to export any of our goods or services into their markets.
What about food security? Food security is incredibly important for obvious reasons. Thankfully food security is not the same as self-sufficiency and people need to stop conflating the two.
Recent events (Covid, the War in Ukraine, and wet weather) have demonstrated that the key to food security is to not be too reliant on a single source. The country needs resilient and diverse supply chains if it wants to ensure that it can feed itself. The danger is that if it simply focuses on producing food in the UK or imports from a handful of countries then it will find itself in an incredibly insecure position if a shock – such as a pandemic, war, or changes in weather – were to occur.
If the UK wants to truly have food security then we need to take the opposite approach to self-sufficiency. We should deprioritise agriculture in the UK, strike free trade deals with as many countries as possible, and be prepared to abolish all agricultural tariffs, quotas, and subsidies and welcome a flood of cheap food imports from all over the world. This would probably lead to many UK producers going bust, but this is not necessarily a bad thing. The land would then be put to better use as it could be used to build homes, labs, data centres, transport infrastructure, offices, solar farms, wind turbines, and everything else the country needs to boost productivity and economic growth.
Ultimately, the Tories and everyone else calling for self-sufficiency need to remember the wise words of Adam Smith
By means of glasses, hotbeds and hotwalls, very good grapes can be raised in Scotland, and very good wine too can be made of them at about 30 times the expense for which at least equally good can be brought from foreign countries. Would it be a reasonable law to prohibit the importation of all foreign wines, merely to encourage the making of Claret and Burgundy in Scotland?
We can’t realistically be self-sufficient in food and we shouldn’t try. It would make us all even poorer and the economy more stagnant. If politicians are serious about food security then they should champion free trade and allow it to do what it has done for centuries by bringing prosperity and lifting countless people out of poverty.
Taylor Swift
In what some might describe as a cynical attempt to optimise SEO by dropping in the name of the hugely talented and incredibly famous musician Taylor Swift, on Tuesday I wrote an article for the Evening Standard which was partly about Taylor Swift. It’s essentially the same thing I write every six weeks or so on why the Bank of England keeps messing up and why it needs to start cutting interest rates but this time with a link to Taylor Swift. You can read the article which is partly about Taylor Swift and her Eras Tour here.
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Have a great weekend!