econlife - A Russian Wheat Story With an Unexpected Ending by Elaine Schwartz

There once was a farmer who started to accumulate land in 2005 and now has 3,600 acres. While at first he planted wheat with a dilapidated tractor, now he has state-of-the-art John Deere equipment, top notch fertilizer, and up-to-date seeds.

Sounds like Iowa?

No, this wheat farmer is in Russia. His land is in the same place that Soviet collective farms called Lenin’s Path and Dawn of Communism had once underproduced. But this gentleman sounds like an entrepreneur. He works long hours, owns a fleet of trucks, benefits from a cheap ruble, and has access to improving storage facilities. In world markets he has been faring beautifully.

Russia just pulled ahead of the U.S. as the world’s biggest wheat producer:

Reading about this farmer in a recent WSJ article, I couldn’t help but think about how the Russian economy has changed.

Our Bottom Line: Economic Systems

We could say there are three basic economic systems. And Russia had all of them during the past 120 years.

Tradition

Looking way back at some Russian history, we could go to a typical pre-revolutionary estate owned by an exceedingly affluent family called Osorgin. Located 90 miles south of Moscow, their manor had eight villages, 8,327 acres, and 600 serfs. Its agricultural life was dominated by tradition. In traditional systems, land, labor, and capital produce the same goods and services year after year. Because roles are passed down from father to son and mother to daughter, all remains pretty much the same.

Command

Leaping to the 1920s, we have the Bolsheviks seizing farmland and the beginnings of a command economy. Through a series of five-year plans, the Soviets form a central planning apparatus that told people what and how to produce. As for agriculture, they created a network of collective farms where employees worked for a daily wage determined by economic planners. Individual initiative was disparaged and innovation was unnecessary. While Russia had been a major exporter of wheat until 1913, by the 1970s, they were unable to feed their entire population.

The Market

It took until 1991 for it all to collapse. With privatization, we get some capitalism and a wheat farmer who buys land, works hard, and flourishes. He employs ten farmhands, a cook and 3 guards.


Perhaps this entrepreneur is an unexpected ending to our 120-year Russian wheat story.

My sources and more: A WSJ front page article alerted me to Russian wheat. It also returned me to all that is fascinating about Russian history. I tell some of the story in my text, Understanding Our American Economy–available through econlife.

Ideal for the classroom, econlife.com reflects Elaine Schwartz’s work as a teacher and a writer. As a teacher at the Kent Place School in Summit, NJ, she’s been an Endowed Chair in Economics and chaired the history department. She’s developed curricula, was a featured teacher in the Annenberg/CPB video project “The Economics Classroom,” and has written several books including Econ 101 ½ (Avon Books/Harper Collins). You can get econlife on a daily basis! Head to econlife.

Six Drinks that Changed the World by Andy Jobson

I’m grateful to my sister for sending my A History of the World in Six Glasses as my birthday present this year.  I highly recommend it to you, no matter what you may teach.  Tom Standage examines various epochs by considering the role of a particular drink.  For the ancient world (think Sumer and Egypt), he provides a discussion of beer.  (In particular, I was intrigued to gain some insight as to why we offer toasts at ceremonies.)  The Greeks, of course, grew in power in part due to the wine they were able to produce and trade.  World history teachers would learn some interesting tidbits and find some useful materials for students to read.

I teach British literature from a sequential, historical perspective, and so one unit is on the Enlightenment.  Standage’s discussion of coffee houses as the ‘internet’ of the seventeenth century, helping to spark the scientific advancements that took place, was quite interesting.  There was also some very interesting material about how western Europe managed to procure and grow its own coffee when the Arab world proved to be very proprietary over its resources.  He also noted the resistance to coffee posed by various religious leaders.  No discussion of Britain would be complete without reference to tea, and Standage provides a helpful unit explaining the rise of the East India Company.  I couldn’t help but think of “Too Big to Fail,” izzit’s video on that company, as I read.  Those chapters provided some very helpful additional information about the collusion between the British government and that behemoth company, including some very unsavory dealings.

Another unit deals with distilled liquor (‘spirits’), in particular rum.  While there is discussion of the triangular trade and reference to the American colonial period, there is also some entertaining material on the British navy.  Did you know that “grog,” that sailor’s mixture of rum, water, and limes, may have played a role in British mastery of the seas?  Read the book to find out why!

You might not be surprised to learn that Standage chooses Coca-Cola for his sixth influential drink, noting how it came to be inseparably associated with American values in the “American Century.”  These chapters provide quite useful fodder for discussions about the values of capitalism vs. communism (or the potential pitfalls, to some people, of a truly free market.  Throughout, Standage tells interesting and entertaining anecdotes, mixing in some broad ideas of how cultures change and adapt.

So whether you teach economics, history, or literature, you may find this to be a valuable book.  If you teach none of these things but use the izzit videos in your classroom, you may find portions of it helpful in providing additional background information.

Happy Reading!

An educator of 22 years, Andy Jobson has taught government, economics, and U.S. History. Currently teaching English literature at Riverside Military Academy in Gainesville, GA, he’s also been an administrator, a STAR teacher twice, and taught elementary school with Teach for America.

Book Review - How Adam Smith Can Change Your Life (Andy Jobson)

Review – How Adam Smith Can Change Your Life: An Unexpected Guide to Human Nature and Happiness by Russ Roberts

I recently was introduced to How Adam Smith Can Change Your Life: An Unexpected Guide to Human Nature and Happiness by Russ Roberts.  Roberts takes the lesser known Adam Smith work, The Theory of Moral Sentiments, and selects useful highlights to illustrate how we can know ourselves better and pursue happiness.


I first became interested in Moral Sentiments when I read a P.J. O’Rourke book called On the Wealth of Nations.  Like Roberts, O’Rourke analyzed Smith’s seminal works and made his own observations, (although O’Rourke worked far harder, and perhaps less successfully, at being amusing), and he referenced the earlier book enough that I bought a copy.  Like many before me, however, I bogged down somewhere in the middle.  Smith is brilliant, but his syntax can get complicated, and his reasoning is often roundabout. I got busy with work and family life and set it aside.  

When a friend at izzit.org recommended the book, however, I was excited to re-open my investigation. Capitalism gets a lot of bad press as being ‘heartless’—evil capitalists are the villains of several TV shows and movies nowadays, it seems—but I believe capitalism is actually the most moral of economic systems.  (As Smith put it, as everyone pursues his own self-interest, the good of society results, as if an ‘invisible hand’ were manipulating the process.)  The challenge is to figure out how to explain this.

Roberts does a good job of selecting appropriate passages to explain key ideas from The Theory of Moral Sentiments. He adds more modern stories to illustrate the concepts, such as the role of conscience (or what Smith called ‘the impartial spectator,’ whose approval we seek).  At my school, moral instruction is important, and Roberts takes a book that raises important issues (like ‘How to Be Good’ and ‘How to be Lovely’) and provides a coherent, entertaining overview.  I look forward to sharing portions with my students this year.

You might enjoy doing the same.

An educator of 22 years, Andy Jobson has taught government, economics, and U.S. History. Currently teaching English literature at Riverside Military Academy in Gainesville, GA, he’s also been an administrator, a STAR teacher twice, and taught elementary school with Teach for America.