Download Three Criteria for the GMO Business

LECTURE
GEOG 270
Fall 2007
November 26, 2007
Joe Hannah, PhD
Department of Geography
University of Washington
Three Criteria for GMO
Business
Science – Profitability – Law
Plan for the rest of the quarter
► Today:
GMOs: Business criteria
► Wed: GMOs: Risks and Policy responses
► Fri: Biotech and food security
► Mon: Sustainability (revisited) and
Participatory Development
► Wed: Course wrap-up
► Fri: Paper due and exam review
Today’s lecture:
Three Criteria for GMO Business
► Review
Keynesian and Neo-liberal Capitalism
and International Development
► Three Criteria:
 Science
 Profitability
 Law
Review of Keynesianism
Keynes: responding to Great Depression of
1930s
► “mixed economy” – gov’t and market
► support demand by promoting employment
and controlling inflation
► Basis for social safety nets (welfare,
unemployment insurance, etc.)
► Basis for Marshall Plan and International
Development Programs in 1950s-1980s
►
Review of Neoliberalism
► Adam
Smith, “the invisible hand”
► Focus on the benefits of the market – “most
efficient” way to allocate resources in
society
► Reduced (or negligible) role for gov’t
► Associated with Regan/Thatcher in 1980s
► Basis for globalization and free trade policies
– reduced restrictions on capital
Three Criteria
GMOs
Law
Criteria #1: Science
►
►
►
High Tech
Requires scientific
infrastructure (people,
facilities)
Extremely expensive R&D
 Economically risky
 Few companies can participate
 Must recoup costs
►
►
Science is (for the most part)
located in First World
Science driven by corporations,
e.g., bundling of technologies,
such as “Roundup ready”
Criteria #2: Profitability
Originally, GMOs targeted at richer N.
American farmers
► Need to recoup high R&D costs
► Business model includes selling inputs
(Monsanto merged with or bought several
agricultural chemical companies)
► Intension is to capture market share
► and expand market in Third World
►
Criteria #3: Law
GMO companies need favorable legal
environment to accomplish business goals
► Extensive lobbying, not only in US and
other First World countries, but also in Third
World:
►
 “Free trade”
 Intellectual Property Rights (IPR)
 “Permissive” vs. “Precautionary”
Law: “Free Trade”
►
What does “free trade” mean?
 What policies are not “free trade” policies?
 Is “free trade”neo-liberal or Keynesian position?
Why is “free trade” a critical part of the
GMO business?
► What do GMO companies want to see
freely traded?
► Lobbying: governments and trade
organizations (e.g., WTO)
►
Law: IPR
patents protect value of investments in
inventions
► genetic codes (“genomes”) – such as plant
varieties – are patentable
►
 Up to $5 billion invested in agricultural crops by
private companies through 2004
► require
payments of royalties for replanting
► WTO and bilateral agreements put
increasing pressure on Third World
countries to provide legal IPR protections
IPR: continued
► Remember
Percy Schmeiser?
► Some countries like India have a less strict
system that requires each plant/genome to
be considered individually, and allows for
the replanting of seeds w/o royalty
payments
► GMO companies working very hard to put
more stringent IPR policies in place in Third
World countries
Law: “Permissive” vs.
“Precautionary” Approaches
► “Permissive
Approach” favors allowing an
activity to continue until proof of either no
effect or a negative impact is obtained.
► “Precautionary” approach favors
constraining an activity when there is high
scientific uncertainty regarding its effects on
the natural environment;
GMOs and International Economics
► Do
GMO companies want a Keynesian or a
neoliberal economic environment? Why?
► How about their opponents?