Aaron, I totally agree...and disagree at the same time. You're right, that argument is based on the mono-crop model, but that model is actually cheaper and more "economically efficient" (a loaded term, I know). Please understand...I'm not arguing it's a good thing, it just is. The traditional model of your grandparents may be more efficient and less expensive to them, but from society's perspective it's sadly not, given how we've set the house of cards up. If every local economy attempts to produce the full range of food products that are desired for a modern paleo diet, it would be incredibly inefficient and quite impossible in many places in the world. It may work where you are, but I live perched on a piece of granite overlooking the North Atlantic. We have limited capacity to produce livestock, fruit, or a wide variety of veg. We import our meat from the West, and yes that sucks, but unless we're willing to limit our diet to what we can produce, that's what we're faced with. And I can guarantee that in this neolithic world of unlimited choice, entitlement, and "I NEED IT NOW!" consumerism, very few people would be willing to make the difficult choices required.
It's partly a case of the horse being out of the barn. People where I live love to talk Buy Local (which I agree with), but they (we) also love our avocados and coconut (affordable clothing, computers, cars, bicycles, Vibram 5-Fingers...)
For the record...I'm with you. I've done consulting work with the local beef industry and have pushed them to think laterally - to try and get out of the commodity grain-fed beef industry and move to grass, recognizing it is a niche industry for a small number of producers. I also understand that there are negative consequences from society's perspective, and that those things need to be understood.