Sunday, July 10, 2016

Creative Destruction

Heritage Industries
Creative Destruction
By Stephen L. Wilmeth

             When truth in science is acknowledged, Allan Savory suggests we won’t have enough cattle to manage our grasslands.
            If that is a premise this morning, our world must change before we commence large scale turf health restoration. The political culture today does not allow truths to be told much less heralded. Our leadership celebrates power over truth. We witness it everywhere, but, when power displaces truth as the rule, the first law of logic is abandoned.
            Aristotle reminded us of that. He warned against it.
            He counseled that morality, truth, and reason must prevail. Each is part of identifying characteristics of destroyers of our customs, our culture, and our way of life. We must identify those destroyers before we lose the cornerstone of reason to guide us. False truths that blemish or misidentify our way of life are deadly to our existence.
            As ranchers, the object of our lives, our cows and their relationship to grasslands, is not only misunderstood, it is being branded as immoral. The abundant rhetoric being used to cast dispersions against this relationship are inversely proportional to the wisdom it contains. We need a transformation of thinking.
Our country needs a renewed hunger for Truth.
The sound of saddling in the predawn is timeless.
Most of the time there is little conversation. Rather, each cowboy is concentrating on his task at hand. There is always tension and it applies equally to cowboy and horse. There is pressure of uncertainty and the interplay of the participants. There is pressure of performance and it is heightened by the reality of raw circumstances. There is no formal policy that applies to man and animal. The horse relies on communication that isn’t written.
Thursday was the final day of a late spring work marathon that started on the 6th of June. Every cowboy felt the grind. I was tired and the crew was equally or more so. For the first time, I didn’t engage with the crew in the extreme physical demands in the branding pen. In the early days, I rode in the gather. In the latter, I only branded.
Every morning started at 4:00 AM. It involved trucks and trailers, miles before sunup, and all the risks inherent in this way of life. Several days hit 104° and only one rain event delayed the process. Overall, it was a perspective of mixed reactions. There were emotional and physical catastrophes.
On Saturday, July 2, Congressman Steve Pearce visited. His visit was part of a pre- Independence Day tour emphasizing the risk of further reduction of heritage industries to New Mexico. Days before he had been in the Lincoln National Forest advocating compromise in the case of withdrawal of sources of water to ranchers impacted by the jumping mouse. He called attention to parallel impacts to the lumber business of the area and how it had been eliminated as a source of local and regional jobs. In fact, the logging industry is decimated in this state.
The mining industry is similar. It is static or declining and political efforts to further reduce it are powerful. Only existing, large scale mining remains somewhat robust. Small mining operations, which once numbered in the hundreds, now number less than ten in the entire state and the expertise that once accelerated their expansion and relative advantages to the whole are gone.
Farming and ranching are under similar regulatory and political maneuvering. One example is the recruitment of young farmers and ranchers in Dona Ana County. There is only a 17% recruitment rate among current operations and barriers to entry are forever tightening. The loss of critical mass in the segment poses the growing likelihood of what the wildlife biologists describe as “accidental losses” whereby any reduction of numbers poses the likelihood of structural collapse.
As Congressman Pearce branded a calf, the emotional impact of watching the cowboys observe him was not missed. When it gets right down to it, it is the foundational spirit of America that is at stake with the issues that affect this industry. It is manifested in many ways, but it starts with human beings that are not expecting anything from anybody, but, rather, they simply ask for nothing more or less than a chance to make their own way.
Creative Destruction 
When heritage industry segments decline, towns die, more workers are laid off, and the local tax base shrinks yet more. In the case of that group of cowboys, the symptoms are far from subtle. As they sat horseback or took their turn on the ground, they came from six counties and two states. Their skill levels ranged from beginner through journeyman with only a few near a threshold of what could be termed, Master.
Their fate, however, is not controlled by their ability but by a legion of suited scribblers who have bought into a utopian belief that government and special interests are more important than local empowerment. They not only pay their own way, they are subject to all the restrictions placed upon their heritage roots. They don’t play on an expanding field of opportunities, but, rather, a finite field of limited enterprises and regulatory mandates.
I believe that is the story Congressman Pearce remains committed to resurrect. It is his attempt to uphold truth as it applies to businesses that are, by their very nature, difficult to survive. It has been made much worse by a governing system that has become an exercise in creative destruction to its own productive members.
Saddling in the dark should be a prerequisite for every suited scribbler. It would be yet more powerful if the consequences of decisions inherent in such actions were tied to economic results. Truth has a way of moderating actions if it is allowed to run its course, but, as we all know too well … Truth doesn’t apply to Washington.

Stephen L. Wilmeth is a rancher from southern New Mexico. “Washington promotes … Creative Destruction.”

In a free society creative destruction is good.  See this from the Library of Economics & Liberty:

Joseph Schumpeter (1883–1950) coined the seemingly paradoxical term “creative destruction,” and generations of economists have adopted it as a shorthand description of the free market’s messy way of delivering progress. In Capitalism, Socialism, and Democracy (1942), the Austrian economist wrote:
The opening up of new markets, foreign or domestic, and the organizational development from the craft shop to such concerns as U.S. Steel illustrate the same process of industrial mutation—if I may use that biological term—that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one. This process of Creative Destruction is the essential fact about capitalism. (p. 83)

Although Schumpeter devoted a mere six-page chapter to “The Process of Creative Destruction,” in which he described capitalism as “the perennial gale of creative destruction,” it has become the centerpiece for modern thinking on how economies evolve.

The saving grace comes from recognizing the good that comes from the turmoil. Over time, societies that allow creative destruction to operate grow more productive and richer; their citizens see the benefits of new and better products, shorter work weeks, better jobs, and higher living standards.

This constant churning in the market is the result of consumer choice and accrues to the benefit of all.  The creative destruction by government, of which Wilmeth speaks,  is of course just the opposite.  The edicts issued by a few powerful bureaucrats benefits the few and results in fewer  products of less quality and lower living standards.  It is a permanent destruction.

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