Interview by Willi Paul
“EcoCommerce 101 offers a concrete vision and pragmatic approach to understanding the emergence of markets for payments for ecosystem services (PES). With agriculture as a prime example, author Tim Gieseke makes use of actual and visionary examples of how cooperation between leaders in business, agriculture, government and ecology can lead to the emergence and generalization of ecoservices markets. EcoCommerce principles applied to urban ecosystems and other business activities, such as retailing or water services, could mean the emergence of a truly-green global economy; one which would be based on investing in ecosystem management and restoration.” — Joël Houdet PhD AgroParisTech
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EcoCommerce 101, The Emergence of an Invisible Hand to Sustain the Bio-Economy, a new book by Tim Gieseke, is the culmination of 20 years of seeking solutions to the ecological and economical balance needed within agriculture; The second Green Revolution, he notes, must embrace natural capital values and the values associated with ecoservices, to the extent that it improves the capacity of both on-farm and off-farm resources.
Over the last two decades, Tim Gieseke has worked to understand the ecological and economical balance needed within agriculture.
Many of the ideas and conclusions from that quest are contained in his new book, EcoCommerce 101, The Emergence of an Invisible Hand to Sustain the Bio-Economy, Bascom Hill Publishing Group, $37.95)
The book, Gieseke says, is “a culmination of 20 years of seeking solutions, five years of focusing on a solution, and a year to appreciate the depth of its potential.”
After earning his masters degree, he worked with local, state, and national conservation policy issues and their relationship to production agriculture. In the early 1990s, he began farming in south central Minnesota, where he integrated his conservation experience within an agro-economic system that was at a 30-year low point and received firsthand experience in the dependency that agriculture has on federal farm policy.
He founded Ag Resource Strategies LLC as a vehicle to assist in the development of an outcome-based resource management process for agriculture, agribusiness, and agri-industry, as well as to align those activities with the governmental and non-profit organizations that provide the necessary support for effective resource management to occur.
“Imagine a farmer sitting down to evaluate his production plan for the year,” Gieseke says. “He considers the price of traditional agricultural commodities and how to produce them in certain quantities.
“Now, add a value for soil conditioning, water quality, habitat, and carbon sequestration indices. For example, what if a water quality score of 80 meets the criteria for multiple beneficiaries? It may meet the objectives of a USDA incentive program, and/or an EPA Total Maximum Daily Load regulatory assurance requirement.
“It may also provide market access via Walmart’s sustainability index, generate a tax rebate from the local watershed district, or become an eligibility requirement to engage in a water quality trading program for a waste water treatment plant.
Farm’s portfolio of ecoservices
“A compilation of these resource indices becomes the farm’s ecoservice portfolio that can be recalculated yearly.”
Providing ecoservices and increasing the natural-capital capacity is an investment in the bio-economy infrastructure, Gieseke says, and is an investment that creates immediate wealth and renewable wealth.
The second Green Revolution, he notes, must embrace natural capital values and the values associated with ecoservices, to the extent that it improves the capacity of both on-farm and off-farm resources.
“Finding the path toward the next Green Revolution is in our self-interests as well.”
While once it was just the government that was willing to pay for ecoservices, consumers and private business sectors have begun to show support, Gieseke says.
“With the retail giant Walmart and others following suit, or participating in their Sustainability Index effort, the tipping point for EcoCommerce may be near. At that point, land managers become the ecoservice suppliers to the nation and world, rather than confined to being the conservation customer of federal and state governments.”
“We now freely talk about water quality trading, carbon credits, cap and trade, wildlife habitat, ecotourism, and social aspects of landscapes, although there is not a common structure as to how we view the values of these components,” notes Jerry L. Hatfield, director, USDA/ARS, National Laboratory for Agriculture and the Environment, Ames, Iowa, in the book’s foreword.
“(This book) provides such a framework, for not only how we value these ecosystem services, but the process through which we quantify this value…
“More and more we are going to be examining the linkages among the monetary value of ecosystems. This book focuses on agricultural systems and their value, which brings the concepts into play in an area in which ecosystem services need to be understood from an economic perspective…e.g., what is the value of soil, what is the value of clean water?
“(While this book) will be a valuable asset to anyone who wants to understand how this economy will emerge… (its) largest value is for policymakers and traders who will be the driving force in the development of policies and practices associated with ecosystem services.
Sustainability and economic value
“If we are to continue to serve the world in which we are entrusted to be good stewards,” Hatfield writes, “then we will have to understand all of the dimensions of sustainable systems, which only come through understanding the economic value.” Many readers will not be convinced that such a system could ever be implemented, says Gieseke.
“Amazingly, though, as long as someone or some entity deems it to be in their self interest, however narrow or broad, EcoCommerce can emerge and commence….The desire to place economic value on a defined level of sustainability is the impetus for EcoCommerce, the same beginning for all emerging markets.”
Agriculture is a unique industry, he notes, in that it provides 90 percent of the food for the world’s people and is the most intensively-managed ecosystem.
What is being lost, he says, is the production capacity of the natural capital of soil.
“This soil ‘factory’ is being gradually depleted under the production system that provides food for six billion people. A scenario that could put further stress on these ‘food factories’ would be if cellulosic material can be readily converted to liquid fuels or other energy sources. Then the ‘invisible hand’ of the economy will encourage resource managers to provide both food and fuel stocks to a population that is estimated to be nine billion by 2050.” More than 90 percent of all the crops and livestock consumed, as well as livestock feed, is produced by agro-ecosystems, Gieseke notes.
“Unlike other ecosystems, agro-ecosystems do not occur naturally — they are created and maintained by humans …
Agro-ecosystems provide, on average, 24 percent more food per person today than they did in 1961. But by 2020, they will have to supply food for an estimated 1.7 billion more people.
“In essence, the soil factory will have to provide greater production output, while under a management system that will remove additional organic material. Being a finite system it is highly improbable that this type of an economy can maintain the capacity of the natural capital.”
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Interview with Tim by Willi
How should we understand the ecological and economical balance needed within agriculture.
The agro-ecosystem does not exist naturally. It was developed by extensively modifying prairie and forested ecosystems in response to economic market signals, such as the demand for food. Essentially, the economic system tapped into the natural capital of the existing ecosystems to produce goods, such as food, fiber and fuel. A long-held perception was that the natural capital was unlimited in its ability to produce goods. This perception is as flawed as assuming that an automobile manufacturing plant is unlimited in its ability to produce cars without regard to maintenance and rehabilitation.
When the car factory’s roof starts leaking and begins to wreck the assembly line, we become aware of the production loss. When soil erodes – a decrease in natural capital – we are less aware of the production loss and are relatively oblivious to the degradation that the soil loss is causing downstream. Overuse and lack of care in an auto factory provides tangible negative feedback, whereas, overuse and lack of care in natural capital does not always provide negative feedback and if it does, it is often ignored. Essentially, balance does not occur in any system if both positive and negative feedback are not represented in a tangible manner. Since our economic system provides the positive feedback, i.e. financial gains of production agriculture, it would be the system that could most efficiently provide the negative feedback for degradation or to provide positive feedback for improvement to the natural capital.
Monsanto. Killing genes and destroying farmers? Your take?
As a farmer, I rely on the technologies developed and marketed by Monsanto. Now that does not mean that I wholly embrace all that is Monsanto. Nor do I have malice toward them as I have found, anecdotally, that many farmers have toward Monsanto yet purchase their products. I assume my opinion is influenced by the fact that I grew up on a farm prior to many of the chemistries available today to control weeds and I do recall how happy we were as children when we could go from “walking beans” (that is hand pulling weeds in 50 acres) to riding on a chair to spot-spray weeds. “Sustainable agriculture” as traditionally defined can be extremely labor intensive. In addition to removing this laborious aspect from farming, I also notice how the varieties of corn with certain insect-control genes produce more biomass and kernel than those corn plants without those certain genes. This is, of course, within the context of an agricultural production system using both natural capital biology and capitalistic chemistries.
My take on the whole issue is that the evolution of the agro-ecosystem and its participants is moving toward a hyper phase without adequate feedback to express its potential negative consequences. The short-term expansion of any plant or animal is directly related to its ability to acquire and utilize resources in either a dominant or symbiotic manner. The long-term expansion is directly related to its ability to acquire and utilize resources in a symbiotic and sustainable manner.
If “Monsanto” is the term that is used for the science of genetically-modified organisms, then I suppose we could say that some genes are being left out of the plants or killed from the DNA sequences in favor of GM genes and overtime will no longer be available. If these genes allow, and they seemingly are, a domination of machine or robotic production of food, then the evolutionary pressures against farmers will be increased.
These evolutionary pressures will continue and only the desire and passion of warm-blooded agrarians to continue to farm the land in a manner that is apparently rooted deep within our psyche will prevail over a robotic farming future. Of course, this mechanized trend will reside within a revised economic system; one with more expensive inputs, reduced government subsidies and the migration of the major consumption epicenter moving west to east.
In the end, technology has often displaced humans, plants and animals and unless some major shift in how the economy, ecology and human sustainability is viewed the trend will continue.
What is an “outcome-based resource management process” for agriculture?
Prior to the passage of the 2008 Farm Bill, there was extensive discussion in the conservation circles on the topic if the farm bill should resort to outcome-based strategies. To step out of the box, I would mention that the farm bill is very outcome-based and as a agricultural producer I recognize numerous outcome-based policies related to the production of corn, soybeans, and a dozen or so other commodity incentives related to price, insurance, income, and support programs. Essentially, as long as I produced more outcomes of bushels, I was rewarded. The conservation groups generally abhorred this process and tried to figure out how to counter attack it with more conservation incentive programs designed to provide funds to those farmers that were not producing the desired outcomes. An outcome-based process is not paying farmers that were not producing outcomes, but paying farmers for producing conservation outcomes. It sounds simple and logical, but the perception is that we should not pay farmers for something they should be ethically-inclined to produce, but we should pay farmers in the attempt to instill a conservation ethic in them.
To answer your question, an “outcome-based resource management process” for agriculture is a process that rewards, monetarily or otherwise, farmers that manage their land in a manner that will produce ecosystem services such as clean water, air, carbon sequestration, habitat and the myriad of other natural capital components that are essential to life and livelihood. The challenge to this is the inability to directly measure these ecoservices, but it is a challenge that is easily overcome when land management strategies are considered.
Walmart’s sustainability index? Who benefits from this? Do I !?
We will all benefit from Walmart’s sustainability index efforts. Since Walmart is one of the largest providers of goods to consumers, it also procures a tremendous amount of resources for our purposes. I believe that because Walmart’s global footprint and view of the world’s ecosystem resources is so extensive, it can no longer ignore the inevitable that the world’s resources are finite. Their sheer size allows them to see the wall ahead. That wall is made up of ecosystem limitations and Walmart can interpret that to mean economic limitations. Walmart’s sustainability index is akin to an engine’s governor. Currently its engine is allows to run wide open and its suppliers are beckoned to do the same. By creating sustainable production standards for its products, it allows the engine to run at a slower speed and still produce efficiently. It will allow our ecosystems the time and energy they need to replenish their supplies and functions. Of course this does not come to us for free. It will provide a market signal that we will need to consume slightly less in the short term to prevent an ecological collapse here and there in the medium and long term.
Is sustainability like a new religion?
It is like a religion in the aspect that when an individual, community, corporation, or nation truly understands that the Earth has real limits, it is enlightening, humbling and generates a mind-set of ideas and innovation. It creates an acceptance that leads to appreciation and an enthusiasm to preserve it. Nothing becomes more necessary than maintaining the functions and processes that we depend on for our lives and livelihoods. From a biblical perspective, sustainability is the movement from the point that many are at of having a disregard for how the earth provides us with life and livelihoods to a point that we transition from old testament economics to new testament EcoCommerce, in which we again save ourselves from ourselves.
Tell us about your ethics?
All things being possible, my land stewardship ethics would be aligned with that of the Native Americans, in that effects of our decisions should be reflected in the needs of those seven generations forthcoming. I also believe that I, like most people, strive to do what is right for self, family, community, nation and world and will seek the highest level of moral character. But not all things are possible and the constraints and demands of billions of people on our planet bring us down this moral hierarchy to the level that we have the capacity to sustain, whether that is planet, nation, community or family.
You discuss the monetary value of ecosystems! How would you sell this to EarthFirst!?
From my understanding of EarthFirst!, I believe they could relate to EcoCommerce; the monetary valuation of ecosystems and ecoservices, but it would take a few conversations to properly incorporate their value system. EcoCommerce readily recognizes the human element of the planet and its institutions to allocate resources and allow democracy and the invisible hand of the economy to function. EarthFirst! may initially see EcoCommerce as another means to capitalize on the earth’s wealth. To sell this concept I would need their acceptance that our economic system will remain intact in some fashion. They would need to accept that a monetary system that represents wealth will be used to allow individuals to gather and allocate the necessary resources for their self and family.
If these fundamentals are accepted by EarthFirst!, then EcoCommerce is the means for the human-made economic system to be integrated with the naturally-derived economic system. In an EcoCommerce system, EarthFirst! could evaluate the value of ecosystems within the context of human-derived economic system. EcoCommerce connects the two economic systems and allows the economic system to be the tool to improve natural capital rather than the reason to degrade it.
How does permaculture factor into the big green picture?
The shape and direction of our economy and the subsequent management of our ecosystems leaves a permaculture system priced out of the big green picture at the moment. Permaculture is a systematic approach to maintaining natural capital and producing ecoservices that a functioning ecology provides to the economy. These are the positive externalities that our economic system gobbles up as they are not even priced on the menu. Permaculture and other similar agro-ecosystem management strategies need an economic voice. EcoCommerce provides the platform for this voice and the ability to account for these positive externalities. As our economy has the potential to shift from a heavily subsidized and external energy inputs to a more economically rational production economy, permaculture and its symbiotic benefits can play a larger role in the big green picture. As EcoCommerce is realized, it is vital for the ecological values to have its voice.
Define localization. Is this 180 degrees from corp. farms?
I believe localization is viewed in a different lens than just geography. Localization is about knowing and liking the people and process of how food is produced. So from this perspective it really is 180 degrees from corporate enterprises. Corporate enterprises do have a stake in how their consumers view their production systems, but many consumers accept the corporate system as a palatable food production system. I think both agro-systems are valuable and that one should not prevail over the other in entirety.
Can you describe the concept of “natural capital of soil” as if you were talking a 12 year old for us?!
The natural capital of soil, or perhaps better stated, the soil is the natural capital, the factory of our food production system. Much like a factory contains conveyor belts to move parts, machines to change parts, people to put parts together, the soil contains tiny insects and animals that move nutrient and vitamins around, the soil uses rain water, the heat and light from the sun to change pieces of the soil so that plants get to use them. Plants send their roots down into this soil factory to get the parts so that they can build leaves, seeds, grains and more roots.
What is unique about this soil factory, is that as long as its topsoil does not erode and the insects and tiny animals stay alive, the factory keeps producing plants and more soil. The natural capital of soil not only produces plants, but it produces a better factory that can produce more plants.
On the other hand, if you allow the topsoil to erode and the insects and tiny animals do not stay healthy or they die, then the factory starts to shut down. The plants send roots into the soil factory, but nutrients and vitamins are not readily assembled and the plants grow slower, produce fewer leaves and less grain.
If you are a farmer, it is part of your job to make sure that the soil factory stays busy and healthy, so the plants grow better and produce more food.
Tim Gieske, agresourcestrategies.com
Tgieseke at agresourcestrategies.com