Missing Agflation’s Big Picture

haiti food riot

There have been a number of reports in the papers about food prices, and its dangers. But despite a great deal of ink being spilled, the full story isn’t getting told.

Alan Beattie writes in the Financial Times about how concern needs to shift from farmers to consumers. He misses the fact that the countries that are best able to weather this storm – Japan, South Korea, the EU, and the US – have treated their farmers rather well, and as a result have a cushy food surplus with which to feed them in these lean times.

Paul Krugman has a perceptive column in The New York Times on grain prices, where he takes particular aim at the folly of biofuels, but also sees that

Governments and private grain dealers used to hold large inventories in normal times, just in case a bad harvest created a sudden shortage. Over the years, however, these precautionary inventories were allowed to shrink, mainly because everyone came to believe that countries suffering crop failures could always import the food they needed.

But he misses the face that free markets in grain are a classically liberal idea, and were responsible for the making of the third world. The ‘everyone’ who came to believe that poor countries could import things were usually people trained in neoclassical economics, working in places like the World Bank, who could dictate economic policy to the countries that are now on the brink of widespread famine.

Finally, the various stories of food price riots in Africa also miss the bigger picture. The reason that Africans have been tipped into hunger by these price rises is that many of these economies, the playthings of World Bank policy, have long been teetering on hunger’s edge. Agflation has merely flicked them in.

Update
Ok, I realise that I probably oughtn’t to post things when I’m falling asleep. Were I a little more compos mentis last night, I’d have been more careful. As Irene at NFFC has written, Via Campesina members don’t feel at all well treated in the US, EU or South Korea. That’s absolutely true. Compared to farmers in other countries, who have had their economies opened up to catastrophic effect, farmers in South Korea, the EU and US are doing well. But small farms are all hanging on by their fingernails, and all face government policy that tilts the playing field against sustainable farming, no matter where they are.

Still, the point remains that there’s a false dichotomy between policy that supports farmers, and policy that supports consumers. Not all farmers are the same, after all. Policy that supports large scale industry might not be in the best interest of consumers. But policy that supports sustainable agriculturalists and their communities, and supports agricultural workers most of all, is going to be in the best interests not just of farmers, but consumers too….