But how is it possible that such waste and excess should actually pay-off financially? The answer is that the animal industry (including the huge monoculture crops that feed it), is supported by tens of billions of dollars in annual farm subsidies and other government handouts that make it highly profitable to produce animal-based foods over plant-based foods. A recent article from the Physicians Committee for Responsible Medicine explains the extreme inconsistency between government nutrition guidelines and the subsidies they provide to suppliers.
Not only do such colossal government handouts artificially affect supply, these subsidies also lower the prices of animal products, which would be close to three times as high without subsidies. Considering the exorbitant costs of animal agriculture to the environment; and the costs of saturated fat, cholesterol, and excess sodium to human health, a responsible government would tax, not subsidize, animal products, even if the rights of animals were not an issue.
This is tremendously important because, according to the economic principle of “demand elasticity”*, the demand for animal products would likely decline to nearly half of its current level if the government simply stopped providing subsidies, since this would cause prices to rise closer to their natural level of 2.6 times current (subsidized) prices. If animal products were taxed to compensate for their disastrous effects on the environment and human health, prices would rise to multiple times current rates, dropping the quantity demanded to a small fraction of its current level – a boon for the environment, human health, and most important, the individual animals whose lives are discarded like one more waste product of this obscene business.
* In economic terms, “demand elasticity” indicates the percentage change in quantity demanded in response to a one percent change in price. (Animal products likely have an average demand elasticity of -0.7, ranging from -0.01 to -1.7).
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