Rising Food Prices & Starving Humanity Around the Globe
Hunger has a new face now, more urban hunger than ever before in past one century. Food is on the shelves but people are unable to afford it. Prices of staple food has risen 100-200% in one year alone; wheat 114%, corn 130% & rice 200%. In last 3-5 years the commodity prices have gone up by 300-500%. 35 countries including India & China are facing social unrest because of the rising food and energy prices. India & China are denying it in their own ways; China a dictatorship rarely tells about their internal problems and India governed by corrupt & communal leaders dishonestly says they have enough food stocks without telling the world that majority of the 800 million Indian poor can not afford to buy food especially at these prices. The implication of food crisis are being under estimated by every one including America, Germany, Japan, Saudi Arabia around the world despite on going violent riots for food across the globe.
Since Feb violent rioting are happening over the doubling of prices for staple food in a year in Haiti, Cameron, Ivory Coast, Mauritania, Mozambique, Senegal, Bolivia, Cambodia, China, Philippines, Indonesia, Pakistan, Uzbekistan, Egypt, Jordon, Yemen etc. Asian countries such as India & Pakistan have curbed rice exports to ensure supplies for their own residents. Philippines have declared Rice hoarding an Economic Sabotage offense and are considering moratorium on converting agriculture land for housing and Golf courses.
2.8 billion People, nearly half of the world's population live on $2 a day or less. When you are living on $2 a day, most of your income is spent on food; not processed chicken dinners and frozen pizza, but the basics: flour, corn, rice. This is what keeps you and your family alive. In country like India with world’s largest population of 800 million poor; they spend $1.50 a day out of their meager less than $2 a day income on basic food. When food prices have gone up by 100-200%, alone in last 12 months, it’s not a matter of cutting back in other areas. Instead it means that they and their children will eat less, and go to bed hungry at night or may develop serious malnutrition ultimately leading to deaths.
Most of the worst famines in modern history were caused by Western Imperialism and free market fundamentalism. The Irish famine, the famines in India in the 1700’s, 1890’s and 1940 all turned from draughts into famine by deliberate decisions not to “interfere with the markets rather not to provide food for the less fortunate in the society.” In fact as Mike Davis wrote, during 1876-77 famine in India, private charity work were made illegal by the inhuman colonial British government because they obstructed the free market.
Again the improvised Indians suffered horribly at the hands of their own Nehru, Indra Congress governments in the late 19th century as millions starved to death while countless tons of grain was exported to England & Russia to earn foreign exchange and buy sub-standard arms from Russia.
Now the poor in the developing countries are suffering again from free-market orthodoxy in 21 century. The problem here is partly free trade and human greed, or more precisely, the dismantling of local and democratic control that goes by the names Washington Consensus in the developing world and by "free trade" in the developed world.
Hunger has a new face now, more urban hunger than ever before in past one century. Food is on the shelves but people are unable to afford it. Prices of staple food has risen 100-200% in one year alone; wheat 114%, corn 130% & rice 200%. In last 3-5 years the commodity prices have gone up by 300-500%. 35 countries including India & China are facing social unrest because of the rising food and energy prices. India & China are denying it in their own ways; China a dictatorship rarely tells about their internal problems and India governed by corrupt & communal leaders dishonestly says they have enough food stocks without telling the world that majority of the 800 million Indian poor can not afford to buy food especially at these prices. The implication of food crisis are being under estimated by every one including America, Germany, Japan, Saudi Arabia around the world despite on going violent riots for food across the globe.
Since Feb violent rioting are happening over the doubling of prices for staple food in a year in Haiti, Cameron, Ivory Coast, Mauritania, Mozambique, Senegal, Bolivia, Cambodia, China, Philippines, Indonesia, Pakistan, Uzbekistan, Egypt, Jordon, Yemen etc. Asian countries such as India & Pakistan have curbed rice exports to ensure supplies for their own residents. Philippines have declared Rice hoarding an Economic Sabotage offense and are considering moratorium on converting agriculture land for housing and Golf courses.
2.8 billion People, nearly half of the world's population live on $2 a day or less. When you are living on $2 a day, most of your income is spent on food; not processed chicken dinners and frozen pizza, but the basics: flour, corn, rice. This is what keeps you and your family alive. In country like India with world’s largest population of 800 million poor; they spend $1.50 a day out of their meager less than $2 a day income on basic food. When food prices have gone up by 100-200%, alone in last 12 months, it’s not a matter of cutting back in other areas. Instead it means that they and their children will eat less, and go to bed hungry at night or may develop serious malnutrition ultimately leading to deaths.
Most of the worst famines in modern history were caused by Western Imperialism and free market fundamentalism. The Irish famine, the famines in India in the 1700’s, 1890’s and 1940 all turned from draughts into famine by deliberate decisions not to “interfere with the markets rather not to provide food for the less fortunate in the society.” In fact as Mike Davis wrote, during 1876-77 famine in India, private charity work were made illegal by the inhuman colonial British government because they obstructed the free market.
Again the improvised Indians suffered horribly at the hands of their own Nehru, Indra Congress governments in the late 19th century as millions starved to death while countless tons of grain was exported to England & Russia to earn foreign exchange and buy sub-standard arms from Russia.
Now the poor in the developing countries are suffering again from free-market orthodoxy in 21 century. The problem here is partly free trade and human greed, or more precisely, the dismantling of local and democratic control that goes by the names Washington Consensus in the developing world and by "free trade" in the developed world.
We all know money flows in the direction where Rich investor can maximize their profits. Since mid 2005 big investors have been putting their money into Commodities after pushing the Real Estate, Stock Market & Credit Markets towards Toilet Bowl in developed economies like America, Japan, Germany, UK.
The hedge fund activity in the commodities markets quadruppeled in last 3 years. The hedge fund magnates may not be aware they are gambling human lives and think the people will never notice it. The hedge fund managers are making $10 million dollar per day not to be left behind by oil companies who are making $10 million an hour. Then we have CEO of big corporations with inhuman pay packages $1-$350 millions, year end Bonuses $1-$90 million; making $1700.00 to $2,000.00 an hour. In contrast 2.8 billion people make less than $2 a day around the world. 500 CEO of 500 American companies in 2007 made $6.4 billion collectively which works out to be $12.8 million per CEO.
Bill Clinton is the mid wife for present credit market mess and spiraling commodity prices. This womanizer with out application of mind signed The Commodities Futures Modernization Act of 2000 and exempted non-farm commodities derivatives activity from scrutiny.
This legislation has led to an explosion in the energy derivatives market ultimately lead to the biggest corporate failure Enron. It has also lead to the worst financial crises in the history of the world where the Banking system is going to lose over $600 billions in 1 year because of Crafty Debt Derivatives which can not be priced. All these lost billions ultimately are being billed to the world citizens in higher taxes, higher cost of goods & services and reduced services by their respective governments. Bill’s wife Hillary Clinton with his gang of criminal donors like Mark Rich, Hsu, Sant Singh Chatwal, P S Sabharwal, Vinod Gupta, pharmaceutical, defense, Wall Street, Health Insurance, Banks Robber Barons etc. wants to be the President of America with more than $500 million already spend on her campaigaining!
Speculation by traders at banks and hedge funds all over the globe has driven up the price of oil to over $120/barrel, wheat over $25/bushel, corn $6/bushel and rice $25 per cwt. Rich investors see commodities like oil, wheat, corn, rice etc as an effective hedge against a falling dollar and rising inflation. They can be blamed for much of oil, wheat, rice and corn price rise this year to speculative buying. Rich are Gambling with paper barrels and paper commodities in OTC activity or at ICE, LME, NYMEX and Chicago Board of Trade. According to an analyst Floyd Norris wheat futures jumped 23% due to the activity of a single trader MF Global a white collar legal gambler looking for quick profits at the cost of human miseries and sufferings.
The commodities derivatives market had risen to over $7 trillion dollars by June, 2007, according to the Bank for International Settlements. It is certainly much, much higher now, as money has flooded in looking for better profits, in the wake of the credit derivatives crisis. That number alone, a fraction of the total market in derivatives, which is now between $500 and $600 trillion dollars, dwarfs the activity on the NYSE
Global wheat stocks have hit a 30-year low following seven of eight years in which world consumption exceeded production. Federal projections show America's supplies at their lowest levels since the late 1940s. Wheat historically trades at $3 to $7 a bushel crossed $25 in March. Four months ago, a Bakery was paying $7.50 for a 25-pound bag of flour and now the cost is $25 a bag.
Half of the increase in global corn consumption in 2007 was related to ethanol production, and the recent U.S. Energy Bill will ensure continued increases in demand from this source. Despite the fact that it takes 26 lbs. of corn to produce one gallon of ethanol. The record $6 a bushel corn price has already led to major spillovers on prices of other food commodities through higher feed costs, crop substitution, and demand substitution, and further spillovers are likely to be continued unabated.
Then worldwide meat consumption is forecast to increase by more than half from 1997 to 2020; most of the new demand will come from China and India. The implications for grain demand are staggering." The growth of the middle class in China and India is a problem partly because of the precipitous increase in demand for animal based protein. Unfortunately India & China are making more meat eaters than the Americans who are switching to vegetarian food.
Animal protein uses large amounts of grain. The excessive craze for Meat in the West is starving the rest of the world. It takes 700 calories of grain to get 100 calories of meat or a pound of Beef takes 7 pounds of grain and a ton of water. So we are effectively wasting 85% of our cropland, not to mention the energy use that goes with it and the one more scare commodity water being over used.
Above all the dollar has suffered with these "free market" trillions to bet on Commodity Prices, but not to own, to consume, maintain, or build to the extent we have allowed this immoral gambling to continue. Hedge funds are not capitalism but raw speculation, human greed and legalized robbery. A perfect recipe for the world food supply to crash, when we have known since 1994 that per capita grain production peaked over 20 years ago, around 1985 and still we paid no attention to the impending crisis. These crises are going to be human sufferings to such a horrible magnitude which we have not seen or heard for centuries.
First, free trade supported to the hilt by all US, European Political & Business Leadership and media to destroy local farming in developing countries, especially subsistence farming through cheap imports from the US, Australia, Canada and others. Then Western countries and generally rich peoples' buying power has diverted food reserves into meat and fuel production for the well-off and deprives the poor of very basic food supplies like wheat, corn and rice.
World crisis of food supply, global warming, and land degradation etc., the only real issue underlying all of these is limitless growth of the human population. A short term view of the situation that does not recognize overpopulation is both simplistic and myopic, and will do little if anything, to rectify the situation. Essentially all environmental problems are proportional to the number of humans consuming resources and belching out chemical pollution. Thirty years ago the world was intensely aware of the 'population bomb', yet today the human population has doubled and no one dares mention it especially the Leaders of India and China who have failed to address the rising population problem in their countries; who have the 75% of poor out of the 2.8 billion poor in the world.
It took 123 years for the world to add the first billion (1804-1927), for the last billion it took 12 years (1987-1999) and it will take projected 14 years to add another billion by 2013 to take the world population from 6 to 7 billion.The world is adding about 78 million more people every year, the population of France, Greece and Sweden combined, or equivalent to a city the size of San Francisco every three days. Almost all of this population growth is in countries like India, China, Nigeria, Muslim countries etc least able to afford it. For example Nigerian families spend 73% of their income on food because on an average Nigerians have 2 to 3 wives, each with 9 to 11 children.
Currently, the world is not able to support such a large population. Food and energy prices are simply a reflection of this fact. Most organizations that monitor world hunger approximate that one child on our planet dies every 3.6 seconds due to hunger. One can only imagine the grief felt by nameless mothers and families that lost their beloved children.
A 2007 Pew Research Center poll of 45,000 people in both affluent and developing countries found that most surveyed believed that a world free of hunger and poverty was more important to them than either free speech or religious freedom. America which is undergoing a recession, one wonders how many people go to bed hungry every night in this land of opportunity. American Political, Business & Religious Leaders are so rife with moral and ethical corruption that no one from either side of the aisle is willing to admit this.
Prospect of food shortages over the next 20 years is so frightening, it had to be tackled immediately on priority basis; before millions suffer and starve to death. America, Europe, Japan, Saudi Arabia and other rich countries must take lead in providing the much needed humanitarian aid to the starving humanity around the globe. Let us all work together in the name of whichever God you believe in to make this world free of hunger and poverty.
God Bless America & every human on this planet earth.
Dave Makkar
