It can be dangerous to assume cause and effect

Did you know that the rate of growth in the money supply in China appears to be highly correlated with the rate of global meat price inflation? If you plot these two statistics out over time with an eight-month lag from the change in the money supply and the change in meat prices, then you get two lines that are hard to separate. Brett Stewart, Global AgriTrends, pointed out this little tidbit of information at the WATT Meat and Poultry Supply and Price Forecast webinar.

Stewart made no claim of causality but said he would keep looking at these two measures in his search for a way to predict future meat prices. I wish that the United States Environmental Protection Agency (EPA), state departments of the environment and environmental groups would take the same approach as Stewart and not make assumptions about causality when it comes to Concentrated Animal Feeding Operations (CAFO), manure use as fertilizer, and nitrates in the soil or “excessive” nutrients in bodies of water.

In Rose Acre Farms’ battle over a new NPDES permit with the North Carolina Department of Environment and Natural Resources, state regulators have chosen to follow EPA guidance and assume that high nutrient levels in waters outside of the layer farm are caused by emissions from poultry house ventilation fans. The fact that air removed from the poultry houses contains some fraction of ammonia and dust doesn’t prove that these substances leave the farm and make it into nearby bodies of water in quantities large enough to cause the nutrient levels that trouble the regulators.

There is a big difference between two things being correlated and the existence of a true cause and effect relationship. Assuming a cause and effect relationship, when none exists, can lead to a lot of wasted effort, i.e. time and money, and get you no closer to a solution to the problem at hand.

The U.S. system for management of the environment is driven by litigation, which has created an adversarial approach that doesn’t promote the type of cooperative effort that is needed to find real solutions.

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