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And avoiding regulations isn't the only reason big farms are more efficient nor do small farms always comply with every regulation, escaping by being too small to notice.
Regulations are orthogonal to the question of efficiency. Regulations don't exist to affect efficiency, they exist to enforce the common good at any scale.
So I'm not defending mega farms. I'm certainly not suggesting anyone should avoid regulation. I'm just saying economy of scale applies to farms and to suggest otherwise undermines any other argument one might make—if one argument in your quiver comes from a place of ignorance, what might that say about the rest?
Regulate farms. Examine the subsidies. Target the abuses. By all means, there is nothing morally good about mega farms. It's just that I'm yet to see a good argument against them on the basis of efficiency.
The argument against here should be, "any gains in efficiency are overshadowed by unethical treatment of animals, risk of population collapse due to rampant infections, and regulatory capture by farm lobbies." Or some such.
All IMO, of course. Fight your battles as you will. But I will call out fallacies of friends and foes alike because I don't think they serve anyone.