Searching for Coexistence of GMO and Organics in Amsterdam

I recently returned from a conference on the co-existence of genetically modified food (GMO) with other food, such as organic. The meeting was on November 17-20 in Amsterdam, which was rainy, cold and windy, an unpleasant departure from the sunny and dry climate of drought-stricken Berkeley that I have grown accustomed to. Fortunately we were located in a hotel at DAM Square – the center of the city where everything began – that did not have much exposure to the weather.

I was fascinated from my time in this bustling city. Amsterdam has all the major brands you see in major tourist towns: Zara, Hermes and Gucci. But the local stores especially emphasize what seem to be the pillars of the local economy – cheese, marijuana, sex, and alcohol (you feel like you live in a Heineken ad). And the head shops put Telegraph Avenue in Berkeley to shame. The city is friendly and crowded, in a constant state of orderly chaos. As a taxi driver told me, “You might think that traffic is a mess- but there is some logic there- people tend to obey the red lights but use common sense when it come to other rules. Freedom is good.”

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One benchmark to judge conferences, especially on topics related to food, is on their nightly dinners – and this one was a winner. Our first conference dinner was in a fish restaurant in a charming building built around 1640. We climbed a narrow and steep staircase to our seats on the thiIMG_2030rd floor (safety and access rules are rather recent phenomenon). A unique feature of the restaurant is a Rembrandt self-portrait on the wall – I guess he gave it in exchange for a meal.

The next night we had a lovely tour in the rain of Amsterdam’s canals on the way to second and main dinner of the conference, which was held in a grand and very impressive and elegant building. The dinner included a presentation of the history of Amsterdam and we learned that the dinner’s venue served originally as a church, later converted to become the first stock market in the world. This stock market financed the Dutch discoverers and trade companies during the golden era of Holland in the 18th century when Amsterdam was the richest city in the world.

We learned that the Dutch discovered New Zealand, bought Manhattan, and renamed familiar locations (Harlem Brookline). The food in both cases was like everything in Holland – not flashy – but well done and enjoyable with an ample supply of liquids. Kudos to Justus Wesseler and his team on organizing a wonderful conference on food issues with a strong culinary component.

The conference was about co-existence…but what is co-existence? The definition of co-existence as addressed in the conference is quite narrow: it is a political and economic set up that allows for genetically modified crops to exist within the same regions of non-GMO and/or organic systems. The conference addressed the relative advantages and disadvantages of GMOs versus other systems, the regulation of GMOs (e.g. labeling, purity standards, etc.), and attitudes and perceptions of biotechnology in agriculture.

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So, what did I learn from the conference?

First, the conference strengthened my impression that we reached some equilibrium in production and use of GMOs. There is some degree of co-existence of GMO and non-GMO products in consumption – and much less in production. Consumers in much of the world consume GMOs indirectly when they consume meats (it is used in production corn and soybeans that feed chicken and pigs), but there is very limited direct consumption of GMO products as food (papaya, sweet corn and few vegetables).

Much of the GMO products are produced in the US, Canada, Brazil, and Argentina, and even though GMOs are used to produce few feed crops in much of Europe and Africa, regulations practically ban GMOs. There is evidence that the limited use of GMOs already benefits the poor and the environment by reducing the price of foods, the use of heavily toxic pesticides, and the greenhouse gas emissions of agriculture.

Second, Europe is changing its regulatory regimes. In the past, many applications to grow GMO varieties were approved on technical grounds by the EU regulatory authorities. The implementation was delayed because it was impossible to reach the political consensus needed for approval. A recent policy will enable some countries to ban production of GMO products (opt out of the EU decisions) while the rest will maintain procedures that may allow some production with GMO varieties. This new policy may take the EU further away from the goal of “An Ever Closer Union Among the Peoples of Europe.”

It is expected that certain countries like Germany and Austria may fully ban GMO use. Some sensed that the political reality in those countries would lead to growing emphasis on shunning new biotechnology discoveries and encouraging local food and organic production. Other countries — Spain, Holland, and maybe England — may actually embrace GMOs, and have GMOs and organics side-by-side. But, developing the rules will still be a challenge. Since agricultural biotechnology is evolving and new technologies like gene editing are being introduced, the regulatory regimes will also evolve over time.

The countries that shun GMOs, like Germany, are losing a source of relative advantage and tend to reduce their research capacity in modern biotechnology. It is expected that some of these countries may reverse their positions and regulations in the future.

Third, on average, consumers have negative attitudes towards GMOs. But the attitude towards GMO as a technology are not strong, but rather are affected by the way the choices faced by consumers are framed. Instead, the objection to GMOs in many cases reflects negative attitudes to big agribusiness that became associated with GMOs. Consumers’ familiarity with GMOs is limited: a large percentage of the U.S. public assumes that GM products are much more ubiquitous than they really are, which allows retailers to promote GMO-free chocolates or tomatoes when no such GMO varieties are even available, and thus can charge a premium.

Consumers’ attitudes towards GMOs vary within and across nations. Significant portions of the population in many developed countries may be willing to pay a significant amount to avoid GMO foods, but studies also found that half the population was not willing to pay much to avoid it, and some were even open to pay extra for traits that enhance food quality.

Fourth, surveys found that a large majority of consumers were in support of labeling GMOs as long as they are not costly. A majority of consumers in a survey supported a label stating that the food “contains DNA which is a living organism”. But when consumers realize that labeling is costly, a large percentage will not be willing to pay the cost. Indeed all the propositions in the US to introduce GMO labeling were defeated. In the US we are likely to see voluntary labeling while in the EU, labeling is mandatory. The impact and cost of labeling depends on their implementation.

Fifth, Monsanto – the dominant developer of commercialized GMO traits – has decided to launch a “charm offensive” and reach out to its critics and the critics of GMOs more generally. I wish them the best and believe that they will be able to reach out and change the mind of some open-minded critics of GMOs; but the hardcore opposition to GMOs will not budge. They benefit from demonizing Monsanto and have been very successful thus far.

Whatever the flaws of the company, it was able to harness a great technology that eluded others. Furthermore, this technology already has provided benefits to the poor and the environment. Such technology should have been hailed (like Apple), but the fact that the benefits of the technology are not apparent to the middle class, coupled with the power of the certain interest groups that stand to lose from the technology, and past missteps of Monsanto (it did not have a Steve Jobs) have all contributed to their current predicament. As such, the diffusion of GMOs has been curtailed – and while they have not reached their potential – they already have had a major impact and will have much larger impacts in the future.

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This conference is part of an effort to improve the global food system and the human condition. The current state of affairs is unsatisfactory. The poor and the environment pay a heavy price for the global community’s failure to take advantage of known traits which were not developed and promising opportunities that have not been pursued because of unjustified regulations and barriers.

Furthermore, our ability to adapt to climate change will be hampered by not utilizing the best tools for developing agricultural technology we have. Of course, more and smarter use of GMOs is not the only solution – I believe in diversified agricultural principles that take advantage of the best of biotechnology as well as ecological agricultural practices.

As I see it, cumbersome regulations, efforts to label GMOs, and attacks against Monsanto are not providing alternatives to address the real issues of our food systems. We need to improve food distribution systems and address other societal problems that maintain poverty and restrict opportunities and access.

Uri Regev: an unsung hero of resource economics

Uri Regev, a teacher and friend of mine, passed away on April 22 in Israel at the age of 80. Uri grew up in Kibbutz Yagur in Israel, studied economics at Hebrew University and came to Berkeley, where he got his Ph.D. in agricultural economics in 1968. He spent most of his career at Ben Gurion University of the Desert in Israel, and was a frequent visitor to Berkeley, where he produced some of his best work in the 1970s.

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Uri’s research was multi-disciplinary when being a multi-disciplinarian was not cool. His work integrated biology and economics- studying “bio-economics” — especially the economics of pest control — and his work laid the foundation to a large body of research.

Uri was among the first to study the economics of resistance to pesticides. His co-authored paper with Darrell Hueth[1] suggested that pests have a certain amount of vulnerability to pesticides, and it wears off the more pesticides are applied, and that resistance to the treatment is increasing. Therefore, when deciding to apply pesticides, people should take into account the future cost of the resistance built up, and reduce the use of pesticides accordingly. This analysis resulted in formulas that actually established rules on how resistance considerations affect how much and when to apply chemicals and what the social cost is of over-application in terms of excess future pest damage. Regev and collaborators went on to apply this model[2], and today the formulation they introduced has been expanded and is widely used today.

Another paper[3] was the first to introduce considerations of predator-prey relationships among species to the economics of pest control. It considers situations when a plant is attacked by two pests when one of them is a predator of the other. The predator reduces the damage of the prey, and if you ignore this and eliminate the predator, the damage may become much bigger if the prey is the bigger pest. Therefore, the control of the predator needs to consider cost of the resulting damage by the prey.

Uri had an enduring, productive and inspiring collaboration with a leading entomologist, Andy Gutierrez. Andy applied their models to develop real world strategies of pest control that recognized such complex relationships and have saved many millions of dollars over the years.

Another innovation of Regev and Gutierrez has been modeling the outcomes of multitrophic food chains (e.g. algae — krill — fish –humans)[4]. As human harvesting capacities grow, market-driven harvesting activities may steer the system away from sustainable outcomes towards destruction. The analysis identifies different scenarios where ignoring the rules governing interaction among species will result in undesired outcomes. Improved human harvesting capacity requires policy interventions that will restrain resource exploitation and sustain the ecosystem.

Uri’s work did not get much attention in the 1970s when his work initially appeared, even at his own university at the time in Tel Aviv. But his research has gained much recognition over time — Uri was very satisfied when, about 20 years ago, his work was featured prominently at a conference on the economics of resistance with applications to both pest control and medicine, sponsored by Resources for the Future.

I owe Regev a debt of gratitude. He was chair of the economics department at Tel Aviv University, where I did my undergraduate studies. Every year, he invited the top performers in the second year of the program for a conversation. I will always remember my interview with him: he asked me about my plans and earnings (I was working fulltime while going to school, which was not unusual in those days). I told him that I was earning well as a programmer and I would like to consider pursuing my education beyond a bachelor’s degree. He encouraged me to consider pursuing a Ph.D. in economics and recommended that I take a course in econometrics. He told me that the course was tough, but valuable, and that taking it would help me decide if I should pursue a career in economics.

One month later, I was invited to a ceremony where I received an envelope from the department with a large certificate. Unlike others who received similar envelopes, however, my envelope did not contain a check, which made me appreciate Uri’s sense for social justice and eye for talent. Uri later recommended me to Eithan Hochman as a possible research assistant, which eventually led me to Berkeley.

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Uri was a real gentleman. He was a very kind and supportive colleague and teacher, with infectious intellectual curiosity and a zest for life and adventure. He appreciated the good things in life, was very musical, and actually continued to play the flute till the very end. He loved his wife Nurit deeply and his three daughters and grandchildren. One of his daughters, Tali Regev, has a Ph.D. in economics from MIT; another daughter, Shiri Regev, is a law professor specializing in civil rights; and a third, Gili, is an MD researching control of diseases (interestingly, her research relies on models based on her father’s work on predator-prey relationships).

Uri’s memory will live in the heart of his family, students and friends, and in the work of the people who follow his research.

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[1] Hueth, D., and Uri Regev. “Optimal agricultural pest management with increasing pest resistance.” American Journal of Agricultural Economics 56, no. 3 (1974): 543-552

[2] see for example Regev, Uri, Haim Shalit, and A. P. Gutierrez. “On the optimal allocation of pesticides with increasing resistance: the case of alfalfa weevil.” Journal of Environmental Economics and Management 10, no. 1 (1983): 86-100

[3] Feder, Gershon, and U. Regev. “Biological interactions and environmental effects in the economics of pest control.” Journal of Environmental Economics and Management 2, no. 2 (1975): 75-91

[4] Regev, U., Andrew P. Gutierrez, Sebastian J. Schreiber, and David Zilberman. “Biological and economic foundations of renewable resource exploitation.” Ecological Economics 26, no. 3 (1998): 227-242