The word decentralization has been thrown around so much lately, it has begun to lose all meaning, especially when related to blockchain technology. Before delving into what decentralization means for blockchain, it helps to first understand its significance in the physical world. There are none that understand the importance of decentralization more than a farmer that grows food for his local community. The decentralization movement begins with agriculture.
One particular farmer, Wendell Berry, has devoted much of his life criticizing the centralized nature of the agricultural industry. An award-winning author and environmental activist, he describes in his book, Sex, Economy, Freedom, and Community, his experience growing up in the small town of Port Royal, Kentucky. It started out with a population of around 100 people and came into existence as a trading center for the small farms that surrounded it.
In the early history of Port Royal, it was held together with a complex local economy and a person could find all of their basic needs within the town. But as time went on, something changed. Berry describes what happened to this community, “There is now no market for farm produce in the town or within forty miles. We no longer have a garage or repair shop of any kind. We have had no doctor for forty years and no school for thirty. Now, as a local economy and therefore as a community, Port Royal is dying.”
What happened to Port Royal? When it started out, it had a complex economy, meaning that the surrounding farmers grew a diverse supply of food and one could find most of their basic needs within the town. But at some point, a capitalist mindset kicked in and farmers decided to grow crops for profit, and chose tobacco, instead of growing essential food for the community. Multinational corporations had succeeded in infiltrating this small community and convinced the farmers to no longer serve the local inhabitants.
This area full of fertile land eventually stopped producing food altogether and the community chose to import all of their food instead. Both the land and the people stopped serving local needs, and instead served an outside interest that had no concern for the overall health of the community. Instead of a local economy, it had turned into something Berry called an “absentee” economy, where outside corporations dictated what was being grown. This was happening to rural areas all over America. The decision-making power as to what to grow on the land was being centralized to large corporations. These were the first signs of what Big Agriculture was doing to America and the world.
This problem of centralized decision making was only made worse by the General Agreement on Tariffs and Trade signed in 1947, now known as the World Trade Organization. Its purpose was to create an international “free market”. Words like “free trade” and “free market” give an impression of freedom, but what it really means is that multinational corporations get to decide what is grown and traded in every member nation, with no regard for the local needs of communities.
In terms of agriculture, every farmer in every member nation is thrown in competition with every other farmer. Due to disparities in wages between different countries, the farmers in developed nations must buy expensive labor-replacing machines, fuel and chemicals to compete with the cheapest manual labor of the poor countries. This becomes a competition in land and human exploitation, where profits are prioritized over sustainability. Conservation practices are abandoned in order to increase output. The increased use of synthetic fertilizers and toxic chemicals destroys the biodiversity of the soil, creating a never-ending cycle of requiring external sources of nutrients to maintain soil fertility.
In the poor countries, their food is exported to richer countries where it can be sold for a higher price. Or they may not grow food at all, if crops are chosen for profit and they decide to grow something like tobacco. If no food is grown in the area or it is all being exported, then the people in that community may starve, which is common in third world nations. Because of this global “free market”, the farmers and the small communities in both developed and developing nations suffer. Meanwhile, corporate executives who live thousands of miles away from the farms sit comfortably in boardrooms lining their pockets.
This globalism affects all industrial markets. By having workers in developed nations compete with workers in developing nations, it encourages situations like Chinese sweatshops or children working in strip mines. This explains why most of the world’s manufacturing is done in China. Globalists exploit the developing countries for their cheap labor and cheap materials and sell the finished products to richer countries. This defines the global free market economy. This is what happens when the decision-making power as to how land and people are used is centralized to multinational corporations.