Tuesday, November 18, 2008

Big Agra VS Food Security
James Surowiecki of the New Yorker has good article about the food supply.
This spring, disaster loomed in the global food market. Precipitous increases in the prices of staples like rice (up more than a hundred and fifty per cent in a few months) and maize provoked food riots, toppled governments, and threatened the lives of tens of millions. But the bursting of the commodity bubble eased those pressures, and food prices, while still high, have come well off the astronomical levels they hit in April. For Americans, the drop in commodity prices has put a few more bucks in people’s pockets; in much of the developing world, it may have saved many from actually starving. So did the global financial crisis solve the global food crisis?
The World Bank and the IMF worked to get developing countries to abandon staple crops that could be bought cheaply for export crops that would give farmers more money. The market was more efficient than the governments or so the arguments go. But if there is severe drought in one or two parts of the world, people could starve everywhere.
These changes did not cause the rising prices of the past couple of years, but they have made them more damaging. The old emphasis on food security was undoubtedly costly, and often wasteful. But the redundancies it created also had tremendous value when things went wrong. And one sure thing about a system as complex as agriculture is that things will go wrong, often with devastating consequences. If the just-in-time system for producing cars runs into a hitch and the supply of cars shrinks for a while, people can easily adapt. When the same happens with food, people go hungry or even starve. That doesn’t mean that we need to embrace price controls or collective farms, and there are sensible market reforms, like doing away with import tariffs, that would make developing-country consumers better off. But a few weeks ago Bill Clinton, no enemy of market reform, got it right when he said that we should help countries achieve “maximum agricultural self-sufficiency.” Instead of a more efficient system, we should be trying to build a more reliable one.
We need to start working on local food security here in the United States.

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