Yesterday I visited the Moka Origins factory in the Poconos where they make their wonderful chocolate. Over the past year I’ve started offering some products that don’t grow anywhere around us: spices, chocolate, coffee, etc (actually I think that’s it?) I was always hesitant to carry these because generally speaking the further one gets away from the source of one’s food, the more likely it becomes to overlook the ills of an ethically broken system: forced child labor, unfair pay, lack of reinvestment, low grade ingredients, to name a few. Some large multinational, publicly traded food companies have a tendency of caving into Corporate Social Responsibility (CSR) after mounting pressure from activists, retailers, customers, and politicians, but I have always found these efforts to be insincere and inadequate. I had a job in a past life where I worked for a socially conscious investment firm. A part of my job was to interview the CSR departments of publicly traded companies to see if their efforts were good enough for us to purchase shares. I never really thought that they were.
I checked out Moka’s website after one of my customers/friends told me about them. After a phone call conversation, it became clear to me that environmental stewardship and positive social impact is their raison d’etre. While many large companies have CSR departments as a side thing, Jeff, the founder and CEO, started Moka in order to do things like paying farmers a living wage, reinvesting in local infrastructure, combating poverty, and helping the environment. It’s why these chocolate bars cost $8.
For a while I’ve been wanting to address inflation on this newsletter, something we are constantly hearing and thinking about these days. Seems like the right time to do it now. There are exceptions, but for the most part I am finding that inflation mostly effects goods and services that are closely tied to global markets and long distribution chains. To borrow Thomas Aquinas’s idea of primary and secondary causation, I’d argue that monetary policy, fiscal policy, geopolitical conflicts, and pandemics, everything that we hear in the news that all too easily invites blame and outrage towards one or another political party, are all secondary causes that are not as significant as we are told. The primary cause of high levels of inflation, I think, is more likely the fact that the global economy is made up of long, complex web of producers and distributors. The components of a glass jar and lid, for instance, circumvents the globe several times before it hits a shelf somewhere. A rise in price of just one resource, like oil, compounds down the supply chain.
But this doesn’t really happen in a local economy. It also doesn’t happen with companies like Moka, which deals directly with farmers abroad instead of with distributors who deal with distributors who deal with distributors who deal with an auction house which deals with a distributor who finally deals with a farmer. Fewer degrees of separation mean fewer compounding price hikes. So despite the fact that we have over 8% inflation nationwide, only eggs have gone up in price here at Dave’s Backyard Farms (by 50 cents).
The thing is, a globalized system that has large companies acting within a complex distribution web brings with it efficiencies and economies of scale that allow for ARTIFICIALLY LOW prices. The very reason why these prices are artificially low subjects them to inflationary pressure. In the chocolate and spice industries, these low prices in turn are detrimental to farmers in Africa and Latin America. Contrast this to Moka: the price of $8 a bar is NORMAL; normal because it allows for a normal living wage; it allows for normal infrastructure investment; and it allows for normal environmental stewardship. The interpersonal relations and emotional exchange that occurs between farmers and Moka employees on a regular basis are absent in large, multinational companies. All too easy for business practices to consciously or unconsciously result in exploitation when that’s the case.
This type of sourcing is not only beneficial to people and the planet, but it also results in greater economic stability. When we hear about inflation in the news, I try to think less about the secondary, more fleeting causes that we hear about all the time. The primary cause is deeper, more hidden, and is connected to other problems.
Anyhow, I had a great time there. Moka’s factory is located on the beautiful Himalayan Institute, where I stayed for a night. It’s a yoga retreat with really nice hiking trails. I haven’t done much yoga, but I did some while there. And some silent meditation. It was a nice way to take a rejuvenating mini-vacation. I’m back now with a bit of caffeine withdrawal, full of chocolate and schnozberries, and I look forward to seeing your smiling faces this week.
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