Sahadeo Ragoonanan is one of those individuals who apparently have a second career writing letters to the editor, on issues ranging from trade unions to slavery to bright headlights. And some weeks ago, Mr Ragoonanan was sufficiently exercised by the high price of roast pork to pen a letter on that topic, which was published in the Guardian on January 25 under the headline, Beef with price of pork.
He wrote: “Religious, irreligious or areligious, many of us consume pork in one form or the other, be it baked, stew, curry, processed or roasted...south Trinidad is noted for the best roast pork...A ‘quarter’ pork is in the vicinity of $30. That is, $120.00/lb! My beef is with the price...a pound of imported pork costs around $9! Now tell me, is that fair to the consumer?”
Mr Ragoonanan’s argument is premised on common but erroneous assumptions about economic transactions. His first error is actually contained in his own observation that south Trinidad is noted for having the tastiest roast pork. Since that is so, it means that the establishments to which he is referring—and I myself only know of two, a rum shop in Princes Town and a Chinese restaurant in Gasparillo—make roast pork that is worth more than pork from other compass points, since taste is added value. This reveals the irrelevance of $9 a pound for raw pork as compared to $120 per lb for the roasted product.
Mr Ragoonanan finds that mark-up outrageous, however, while the businesses believe that $30 per quarter is a fair price. And they are right, and Mr Ragoonanan is wrong. I know this without having tasted said roast pork because, if the seller was wrong, he would lose customers. It is the consumer who must decide what is fair to himself, since nobody is forcing Mr Ragoonanan or anyone else to eat roast pork.
Now it is understandable that laypersons have a poor grasp of economics, but this ignorance unfortunately also extends to professional commentators in the media. So Paolo Kernahan in his January 28 column in the Trinidad Guardian wrote: “The nature of modern economics is predicated on infinite growth. The paradox should be obvious and terrifying to all; infinite growth reliant on finite resources has no future.” But the most concise definition of economics is “The study of the allocation of scarce resources”—which is to say, the exact opposite of what Kernahan says economics is. He is right, however, in stating that economic arguments (sometimes) proceed on an assumption of continual growth, but he misunderstands the concept in three ways: (1) GDP growth does not necessarily mean increased use of non-renewable resources; (2) infinite growth is a dummy variable used in economic models for simplification in order to calculate truly scarce inputs, such as labour—ie, it is an abstract premise; (3) economically viable resources increase with technological and scientific knowledge.
In an effective capitalist system, natural resources can never be exhausted since, as those resources become scarcer, their prices will rise and become too expensive long before they are used up. Because of technological advances and increased demand, substitutes then become affordable, as is happening right now with solar energy gradually replacing petrochemicals. And, presumably, Kernahan will not argue that sunlight is a finite resource, although this is technically true since our sun will become a red giant in about five billion years.
In similar fashion, senior journalist Tony Rackhal-Fraser, formerly known as Tony Fraser, in his January 29 Guardian column, wrote what he described as “reality checks” as he indulged in the new international sport of bad-talking American president Donald Trump. “US and European transnational corporations (TNCs) pillaged the raw material resources of developing countries for their industrial development. In turn, that led to endemic underdevelopment in Africa, Asia, Latin America, and the Caribbean,” Fraser asserted. This sentence alone rests on two fallacies: the Africa-is-rich fallacy and the zero-sum fallacy. The zero-sum fallacy assumes that, in economic transactions, one party benefits only because the other loses. In fact, in most transactions, both parties end up better off. The Africa-is-rich fallacy is based on the premise that raw materials have some inherent value, so Africa is rich because it has, say, copper and nickel deposits. But these minerals only have value because of technologies developed by the self-same European and North American societies.
Rackhal-Fraser goes on to assert that, “It is the American TNCs which moved production abroad to enhance their profit margins through the use of cheap and poorly organised labour.” Again, the error here is to assume that the labourers didn’t also benefit from the presence of the TNCs, which as a matter of empirical fact usually paid higher wages that most local companies and offered jobs to persons whose best alternatives were often precarious farming and prostitution.
Finally, there is well-known environmental activist Wayne Kublalsingh who, in a letter published in the Express on January 26, called for “flagship farming economies”. But Kublalsingh, of course, is a man who can survive without water and food for months while living on tulsi leaves. And the fact that many respected people in this place believe in Kublalonomics is one reason we are still a Third World country.
Kevin Baldeosingh is a professional writer, author of three novels, and co-author of a history textbook.
