The United States has deployed an unusual arsenal in its battle against the New World screwworm (Cochliomyia hominivorax). Flies and dogs. Not bullets or bombs.
This is the kind of creative destruction that would make even the most hardened hedge fund manager raise an eyebrow. The screwworm, a parasitic fly whose larvae feast on living flesh, has been detected in the Florida Keys, threatening livestock and wildlife. The USDA's response is the Sterile Insect Technique (SIT): releasing millions of sterilised male flies to mate with wild females, producing no offspring.
It is a biological war of attrition, and the dogs are sniffers, trained to detect infested animals. British biosecurity experts from the Animal and Plant Health Agency have offered assistance, citing their experience with similar outbreaks. One cannot help but draw a parallel to the bond market.
When yields spike, central banks intervene with sterile operations to manage liquidity. Here, the USDA is performing a sterile operation of its own, flooding the ecosystem with impotent flies to suppress a reproductive plague. The cost?
The programme is estimated at hundreds of millions of dollars. But the cost of inaction would be far higher. The screwworm could devastate the American livestock industry, potentially causing billions in losses.
Capital flight from the region is already occurring, as ranchers sell off herds to avoid infestation. The dogs, mostly Belgian Malinois and Labrador retrievers, are trained by the USDA's National Detector Dog Training Center. They are the first line of defence, sniffing out screwworm-infested wounds.
It is a high-stakes game of olfactory arbitrage. The British offer of assistance is welcome, but it raises questions about the UK's own biosecurity preparedness. With Brexit done, the UK has left the EU's rapid alert system for animal diseases.
If the screwworm ever crosses the Atlantic, British farmers could face a similar crisis. The government's spending on biosecurity has been criticised as inadequate. Perhaps the Treasury should consider a 'screwworm bond' a dedicated instrument to finance rapid response.
The markets would price the risk accordingly. For now, the battle in Florida continues. The flies are released from small drones, a touch of 21st century technology to a 20th century technique.
It is a reminder that sometimes the best defence is a good offence, even if that offence is a swarm of sterilised flies.
