The Economic Impact of Bees and the Role of Deceit


Bees and Humans.

“If all mankind were to disappear, the world would regenerate back to the rich state of equilibrium that existed ten thousand years ago. If insects were to vanish, the environment would collapse into chaos.”

E.O. Wilson

Pollinators are responsible for every 1 in 3 bites of food. They increase the output of 87 of the leading crops worldwide. The dollar value of these crops is between $235B and $577B per year. The amount of agriculture dependent on these pollinators has increased 300% over the past 50 years.

According to the Natural Resources Conservation Service, there are approximately 200,000 different species of pollinators. 1,000 of those species are vertebrate, such as bees and butterflies and birds.

In the U.S., there are 4,000 native bee species. Bees have been around for ~130 million years. The image below is from an 8,000 year old rock painting in Spain, showing a person climbing a ladder to get honey from the bees.

Source: Planet Bee

Bees are the incredible creatures. They first appeared to presumably clean up the pollen that was falling from the plants, evolving from wasps to do so (After all, “nature abhors waste”). 

In the most basic of terms, they collect nectar from flowers, regurgitate the nectar once they get back to their hives, begin a de-moisturizing process with their wings, and cap the cell and create honeycomb.

Also, the nectar that they carry usually weighs as much as the bee — bees carry their entire body weight in the air. For comparison, airplanes can only carry 1/4th of their weight.

Source: BackYard Hive

As a vegetarian (I know), most of the food I eat relies on bees — broccoli, soybeans, and a variety of fruits. But even if you are a pure carnivore, you still need bees. Beef and dairy products rely on clover and hay, all of which are pollinated by bees.

Source: BusinessWire

Cocoa relies entirely on pollinators, as do kiwis, passion fruit, vanilla, squash, pumpkins, and different types of nuts, as well as avocados, soybeans, asparagus, broccoli, celery, squash, and sunflowers for oil, cucumbers, citrus fruit, peaches, kiwis, cherries, cranberries and melons, and much more. 

Even better, pollinators can increase production for these crops by 5–50%.

If we didn’t have bees, our produce would be withered and small. And honestly, our bodies would be withered and small too.

Source: FAO

Pollination is the “highest agricultural contributor to yields worldwide”. But pollinators are used for more than just agriculture — they also allow for certain medicines, certain fibers and biofuels, as well as construction materials.

Pollinated products also have heavy secondary markets —notably, Burts Bees, a company that uses the beeswax from bees for cosmetic products, sold to Clorox for $925M in 2007. Burt’s Bees is #1 in Natural Lip Care in the U.S., and #2 in Canada.

Source: Seeking Alpha

From an economic perspective, Chisel’s Honey Bees’ Impact on the U.S. Economy thinks the value-add of bees specifically this way:

Source: Honey Bees’ Impact on the US Economy

or 

  • Value of Honey Bees = Value of Pollination + Pollination Fees + (Honey Sales + Wax Sales) + Secondary Product Value + Positive Externalities

Chisel calculates a contribution of $50B per year from bees specifically. The value of bees are far greater than what they cost.

A bee hive normally costs around $500 to set up and maintain. There are 2.8 million commercial hives in the U.S., each housing about 30,000 bees, depending on the time of year. 

That means that each hive generates about $17,900 in revenue ($50B / 2.8M). Each bee alone generates about $0.60.

Just one of these hives equates to ~1 semester of tuition at the average private college in the U.S. It’s equates to ~ 1 Honda Civic. You could spend 1 night in the Fairmount in San Francisco for the ~$18,000 generated by this hive.

Source: Almanac

This $50B revenue point makes bees a big ‘company’. In fact, bees would be the 219th biggest company on the Fortune 500- bigger than Cisco Systems, Cigna, and American Airlines in terms of revenue.

Source: Fortune 500

Bees and the Almond Industry

Bees do a lot of work. They are holding up the entire almond industry on their tiny little wings. 

Almonds are one of the main crops of the state of California. Almonds occupy almost million acres of CA farmland, and contribute $11B to California’s GDP each year, according to UCLA’s Agricultural Issues Center. 

The US consumed 741M pounds of almonds in 2019. California alone shipped 2.27B pounds of almonds in same time period. Almonds are the #1 U.S. Specialty Crop by Value. The total almond farm value was $5.4B in 2019.

Source: Almonds

For almond production, there needs to be 2 bee colonies for every acre of land. California requires 80–90% of the nation’s bee colonies for the almond crop— which is ~1.7M bee colonies. The crop is 100% reliant on bees.

Source: Beyond Pesticides

This can create problems, especially when the colonies are lost.

The Loss of Bees

The economic loss of a bee colony is substantial. Bee colonies cost around $185 to rent during crop season. In 2010, a beekeeper lost 200 colonies due to pesticides. That resulted in an estimated$5M loss to the U.S. economy due to crop loss.

On the flip side, that means that each colony had the generation potential of ~ $25k in crop revenue. In this specific incident, it was almonds, blueberries, pumpkins, apples, and cherries, as broken down below. For a colony that only costs $185, the $25,000 that could have been generated is a return on investment of 13,414%. 

Source: UMN

But of course, it’s more than just the economics of it. 

It’s absolutely devastating that these bees were killed by pesticides. And the reason we don’t have ‘bee bailouts’ to protect these creatures is because:

“Not a single bee has ever sent you an invoice. And that is part of the problem — because most of what comes to us from nature is free, because it is not invoiced, because it is not priced, because it is not traded in markets, we tend to ignore it.” — Pavan Sukhdev

Humans just keep on interfering, even though nature knows what to do.

Bees and their crops have a symbiotic relationship. Bees have evolved overtime to focus on a specific type of flower. The flower relies on the bee for pollination and the bee relies on the flower for food. 

Right now, extinction rates for bees are 100 to 1,000 times higher than normal because of human impact. This is primarily from 4 main pain points:

  1. Pesticides: When the bees go around to their job, they face the risk of ingesting poison. 
  2. Agricultural practices — monoculture, or farming the same crop each year. That interrupts bee’s nutrient access, and makes them susceptible to fungal and bacterial infections.
  3. Radiation — cell towers can potentially throw off bee’s navigation signals 
  4. Global warming- higher temperatures allow for more growth of pathogens

Bees mean a lot to us as humans. I put them into dollar signs, because that seems to be the only language that we speak sometimes. But think of a world without flowers, without fruits, without a functioning ecosystem. We have to take care of our planet. We have to take care of the systems that support us.

U.S. beekeepers lost 43.7% of their colonies last year, which is above the 39% average since 2011, according to Bee Informed, the not-for-profit group that conducts the annual honeybee survey. A lot of the loss is due to pesticide usage and different parasites.

Bees and other insects support entire food chains. They also provide for a stable ecological system. As E.O. Wilson said at the beginning of this article, we would only have a few years left to live if the insects we rely on went extinct.

Source: The Conversation

We are not so different than the bees — the main point of this article is that we have to stop killing everything. Humans are the cause for so much destruction and pain, to our Earth and to each other. It doesn’t have to be this way. 

But we do need a little bit of deceit. 


The Fable of the Bees: or, Private Vices, Publick Benefits

or honeybees as a metaphor for the economy

Bernard Mandeville published the Fable of the Bees in 1714, which included a piece called the Grumbling Hive. 

“Contemporary society is an aggregation of self-interested individuals necessarily bound to one another neither by their shared civic commitments nor their moral rectitude, but, paradoxically, by the tenuous bonds of envy, competition and exploitation”

Bernard Mandeville
Source: Liberty Fund

Mandeville described a prosperous beehive, full of growth and prosperity. But the hive was not without deceit.

As Sharpers, Parasites, Pimps, Players,
Pick-Pockets, Coiners, Quacks, Sooth-Sayers,
And all those, that, in Enmity
With down-right Working, cunningly
Convert to their own Use the Labor
Of their good-natur’d heedless Neighbor:
These were called Knaves; but, bar the Name,
The grave Industrious were the Same.
All Trades and Places knew some Cheat,
No Calling was without Deceit . . .

The hive was full of nothing but vice, even across the doctors, priests, politicians (no surprise there), and soldiers but yet, society functioned well. But the bees begin to recognize the wrongdoers, the evilness, and wish for honestness and goodness, despite their prosperity. The gods hear the bees grumble, and punish the bees.

The bees all become 100% honest. No bee can lie. The police force, the lawyers, the judges all lose their jobs, because they lie. Doctors tell patients that they don’t know how to heal them, and lose their jobs. Art, an expression of emotion, ceases to exist. Clothiers and merchants lose their jobs because pride and luxury disappear.

The building Trade is quite destroy’d
Artificers are not employ’d;
No Limner for his Art is fam’d
Stone-cutters, Carvers are not nam’d . . .

As Pride and Luxury decrease,
So by degrees they leave the Seas.
Not Merchants now, but Companies
Remove whole Manufactories.
All Arts and Crafts neglected lie;
Content, the Bane of Industry,
Makes ’em admire their homely Store,
And neither seek nor covet more

Mandeville tells us that wealthy and prosperous societies only arise from human’s self-interested desires, and that is what made for successful civilization.

So the hive collapses without these self-interests. 

So Vice is beneficial found,
When it’s by Justice lopt and bound;
Nay, were the People would be great,
As necessary to the State,
As hunger is to make ’em eat.
Bare Virtue can make Nations live
In splender; they, that would revive
A Golden Age. Must be as free,
For acorns, as for Honesty.

Private vices, public benefits, meaning that “the bad behavior of certain individual members of a group may lead to the greatest prosperity for the collectivity as a whole.” Humans cannot exist without a certain degree of undesirable behavior, Mandeville argues. 

I agree with Mandeville. The idea that a utopia of goodness would solve all of our problems is unlikely — even for our bees, which Mandeville compares us too in his work. We probably do need a certain element of self-interest driving our decision-making process.

However, there is an abnormally high level of deceit occurring right now, and this level is harmful to society. It’s the Diminishing Law for Deceit Returns.

I’ll refrain from excessive commentary, but leave you with Marcus Aurelius:

“That which is not good for the bee-hive cannot be good for the bees”

or perhaps,

“That which is not good for the Earth cannot be good for the humans”

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