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 Profitability Science Law GMOs

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?