...Americans have been eating oil and natural gas for the past century, at an ever-accelerating pace. without the massive 'inputs' of cheap gasoline and diesel fuel for machines, irrigation, and trucking, or petroleum-based herbicides and pesticides, or fertilizers made out of natural gas, Americans will be compelled to radically reorganize the way food is produced, or starve. James Kunstler, The Long Emergency (page 239)
Without government subsidies, it's unlikely Americans (and other industrialised countries) would be in this predicament. Government has subsidised the extraction of oil. It was also obsessed with maximising per hectare yields of farm products, and the way it subsidised agriculture led to highly intensive, specialised production that relies absolutely on oil. Without government backing, we'd probably still be eating oil, but not to the same degree and we'd not be so locked into that mode of production. Government is not immune to the winnowing effect of Darwinian evolution. But replacing governments take time, during which irreversible harm can be done to people and the planet. The Soviet Union was directly responsible for the death of millions, but its demise took decades. If government had refrained from getting involved in subsidising oil and agriculture we'd probably be in a much better position to deal threats like oil shortages. The effect of government has been to suppress our capacity to adapt. That's partly because it thinks it knows how best to achieve social goals. It thought that an oil-based infrastructure and agriculture would maximise social welfare, and because of the self-entrenching nature of its subsidies it's as locked into that paradigm as the rest of us.
Social Policy Bonds are an alternative. Instead of targeting narrow goals such as miles of roads built or yields per hectare, it would set basic nutritional or health standards for everybody. The incentives would be for people to maximise people's health in ways that are diverse and adaptive. The bond principle is to subordinate government-funded activities not to the one-time opinions of a handful of experts but to targeted outcomes themselves. The result would be a more resilient food supply system - one that would have the capacity to adapt and evolve.