How Coronavirus will impact food supply with Ag Economist Jayson Lusk

About this episode

This is the analytically densest episode in the batch — a genuine economics seminar disguised as a podcast, with Purdue agricultural economist Jayson Lusk serving as an ideal foil for Vance's instincts. The two build a sustained, multi-threaded argument about price signals: rather than treating rising prices as moral failure ("price gouging"), Lusk repeatedly demonstrates how prices function as scarcity signals that pull new supply into a market, and how price controls instead produce shortages and idled capacity — directly echoing (and pre-dating within this same day's recording) the price-gouging discussion that appears independently in the Dan Broadbent episode, suggesting Vance was actively developing this argument across multiple conversations on 2020-04-09. Institutional distrust runs deep and specific: both men criticize the Defense Production Act's slow follow-through, outdated "just in time" regulatory frameworks (egg resale rules, restaurant-to-retail food routing) that made sense pre-crisis but now actively block adaptation, and — most strikingly — Lusk's own admission that large incumbent food companies "gladly" accept new regulations because they create a moat against smaller competitors, a direct echo of a claim Vance had just heard from Matt Ridley earlier that same day. The bubbles/class theme gets its most explicit treatment yet, invoking Charles Murray's "Coming Apart" to frame the divide between white-collar telecommuters with uninterrupted pay and hourly workers weighing infection risk against eviction risk. There's a striking mob-theme aside about reputational economics replacing regulatory economics — sellers no longer able to "skip town," so instead face social-media pile-ons controlling who's "allowed" to raise prices. The conversation closes on global food security, supply-chain seasonality (you can't produce more grain overnight), and Chinese wet-market/African swine fever dynamics as a speculative link to zoonotic spillover, with Lusk carefully distinguishing where the evidence supports Vance's hypotheses versus where it's genuinely uncertain — the most epistemically careful "yes, and, but" dynamic in the batch.

“There's a special place in hell special for price gougers during a thing like this... I think we're in a precarious position because most people don't understand economics. So if you don't think that there is something that changes price other than people are greedy, you can have real revolutions in a community.”

“At least, you know, in a lot of cases that price increase is actually what you want to see because that increasing price is, is the signal to other sellers and producers to realize, oh, I need to figure out... And those opportunities is what brings that price back down.”

“The mob then controls the narrative on who's okay to talk to and who's not, who did something bad, and who is somebody that's unfair versus somebody saying, Hey, I don't need to get out my expense sheet to show you what all this costs me to get this to you.”

Key moments

• Meat and egg processing plant closures (JBS, Pennsylvania beef plant) as early, concrete signs of supply-chain strain.
• The Defense Production Act critique — invoking centralized production mandates creates cascading unintended consequences (GM drivetrains vs. ventilators analogy, recurring from the Dan Broadbent episode recorded the same day).
• The regulatory-moat admission — large incumbents "gladly" accept regulation because it raises the cost of entry for competitors, tied explicitly back to something Matt Ridley told Vance earlier that same day.
• middle ~44-47%: The extended price-gouging/price-signal argument — the most fully worked-out version of this argument across the entire batch.
• Mob-as-reputational-regulator theme — social media pile-ons replacing the old "skip town" exit option for unscrupulous sellers.
• Dairy dumping and supply-chain rigidity — restaurants-to-retail routing can't flip overnight, leading to real physical waste (milk dumped, cows potentially culled).
• middle ~65-70%: Sustained class-divide discussion invoking Charles Murray's "Coming Apart," and Lusk's candid admission that academics/decision-makers are largely insulated from the consequences they're debating.
• Speculative but carefully hedged discussion connecting climate/animal-welfare regulation, Chinese wet markets, and African swine fever to zoonotic spillover risk.
• Global food security and strategic stockpile mechanics — why some countries hold reserve grain/pork stocks and others don't.

Notable quotes

“There's a special place in hell special for price gougers during a thing like this... most people don't understand economics. So if you don't think that there is something that changes price other than people are greedy, you can have real revolutions in a community.”

“When you invoke the... American defense, whatever the act is where now you start saying you guys produce this and you guys produce that, untold of chaos is being thrown into the market... they need to control more. It's not a good thing.”

“A natural tendency of anybody that's gotten big enough is to increase the cost of entry. And a big way to do that is increase regulatory cost... it makes it really hard for the small person to enter.”

“There's a huge difference between what's going on in the middle, middle, upper class houses across America versus what's going on with everybody else... You still got a paycheck coming in. But there are a lot of people that, that is not the case.”