The Visual Du Jour – Eat Your Veggies! (They’re Cheaper Than Junk Food)

At least according to Mark Bittman in this New York Times article:

From the article:

“THE “fact” that junk food is cheaper than real food has become a reflexive part of how we explain why so many Americans are overweight, particularly those with lower incomes. I frequently read confident statements like, “when a bag of chips is cheaper than a head of broccoli …” or “it’s more affordable to feed a family of four at McDonald’s than to cook a healthy meal for them at home.”

This is just plain wrong. In fact it isn’t cheaper to eat highly processed food: a typical order for a family of four — for example, two Big Macs, a cheeseburger, six chicken McNuggets, two medium and two small fries, and two medium and two small sodas — costs, at the McDonald’s a hundred steps from where I write, about $28. (Judicious ordering of “Happy Meals” can reduce that to about $23 — and you get a few apple slices in addition to the fries!)

In general, despite extensive government subsidies, hyperprocessed food remains more expensive than food cooked at home. You can serve a roasted chicken with vegetables along with a simple salad and milk for about $14, and feed four or even six people. If that’s too much money, substitute a meal of rice and canned beans with bacon, green peppers and onions; it’s easily enough for four people and costs about $9. (Omitting the bacon, using dried beans, which are also lower in sodium, or substituting carrots for the peppers reduces the price further, of course.)”

And it is nice to have an article actually point out some structural / cultural / social factors:

“There are, of course, the so-called food deserts, places where it’s hard to find food: the Department of Agriculture says that more than two million Americans in low-income rural areas live 10 miles or more from a supermarket, and more than five million households without access to cars live more than a half mile from a supermarket.

(…)

The ubiquity, convenience and habit-forming appeal of hyperprocessed foods have largely drowned out the alternatives: there are five fast-food restaurants for every supermarket in the United States; in recent decades the adjusted for inflation price of fresh produce has increased by 40 percent while the price of soda and processed food has decreased by as much as 30 percent; and nearly inconceivable resources go into encouraging consumption in restaurants: fast-food companies spent $4.2 billion on marketing in 2009.

Furthermore, the engineering behind hyperprocessed food makes it virtually addictive. A 2009 study by the Scripps Research Institute indicates that overconsumption of fast food “triggers addiction-like neuroaddictive responses” in the brain, making it harder to trigger the release of dopamine. In other words the more fast food we eat, the more we need to give us pleasure; thus the report suggests that the same mechanisms underlie drug addiction and obesity.”

The Market Says The Global South Must Starve

You must read this four-part article in Der Spiegel:

“Here, in the trading room of the world’s largest commodity futures exchange, decisions are made about the prices of food — and, by extension, the fates of millions of people. Those decisions affect both hunger on the planet and the wealth of individual investors.

For Alan Knuckman, there is hardly a nicer place than the CBOT trading floor. “This is capitalism in its purest form,” the commodities expert raves. “This is where millionaires are made.” The 42-year-old’s face shines with a boyish glow — perhaps because he has never stopped playing.

Knuckman arrived here 27 years ago, and quickly advanced from his first job as a runner in the trading room to a trader. He worked for brokerage firms, soon established his own firm and is now an analyst with Agora Financials, a consulting firm specializing in commodities investments. He also writes a newsletter that offers investment tips. “I trade in anything you can get in and out of quickly,” he says candidly. “I’m here to make money.”

How he makes money doesn’t make any difference to Knuckman. He draws no distinctions among commodities like petroleum, silver or food products. “I don’t believe in politics,” he says. “I believe in the market, and the market is always right.”

How does he feel about exploding food prices? For Knuckman, they are purely a reflection of supply and demand. And speculators? They’re good for the market, because they predict developments early on. Is there excessive speculation? “I don’t see it.”

It’s a surprising comment. Never before has so much cash flowed into financial transactions involving agricultural commodities. In the last quarter of 2010 alone, the amount of money invested in these commodities tripled compared with the previous quarter. There has been a lot of money in the market since the countries of the world tried to overcome the financial crisis with massive economic stimulus programs and bailout packages.

Agricultural commodities attract investors who are no more interested in grain than they were previously in dot-com companies or subprime mortgages. They range from giant pension funds to small private investors searching for new, safer investment options.

The large index and agriculture funds now being offered by the banks seem to have come along just at the right time to satisfy this demand. All of a sudden, the world’s food supplies have become a tradable commodity, as easy to handle as stocks.

The downside is that food prices are rising in parallel to the ravenous demand for agricultural securities. In March, the Food and Agriculture Organization of the United Nations (FAO) reported new record high prices, which even surpassed the prices during the last major food crisis in 2008. According to the FAO’s Food Price Index, overall food costs rose by 39 percent within one year. Grain prices went up by 71 percent, as did prices for cooking oil and fat. The index had reached 234 points in July, only four points below its all-time high in February.

“The age of cheap food is over,” predicts Knuckman, noting that this can’t be such a bad thing for US citizens. “Most Americans eat too much, anyway.”

For his fellow Americans, who spend 13 percent of their disposable income on food, the price hike may be an annoyance. But for the world’s poor, who are forced to spend 70 percent of their meager budgets on food, it’s life-threatening.

(…)

Since last June alone, higher food prices have driven another 44 million people below the poverty line, reports the World Bank. These are people who must survive on less than $1.25 (€0.87) a day. More than a billion people are starving worldwide. The current famine in the Horn of Africa is not only the result of drought, civil war and corrupt officials, but is also caused by prohibitively high food prices.

Knuckman refers to the fact that the poorest of the poor can no longer pay for their food as “undesirable side effects of the market.” Halima Abubakar, a 25-year-old Kenyan woman, is experiencing these supposed side effects at first hand.

She is sitting in her corrugated metal hut in Kibera, Nairobi’s biggest slum, wondering what to put on the table this evening for her husband and their two children. Until now, the Abubakars were among the higher earners in Kibera. The family managed to feed itself adequately with the monthly salary of €150 that Halima’s husband earns as a prison guard.

But that has suddenly become difficult. The price of corn meal, the most important food staple in Kenya, is now at a record high after increasing by more than 100 percent in only five months. Potato prices went up by a third, milk is also more expensive, and so are vegetables.

Abubakar doesn’t know why this is the case. She only knows that she suddenly has to pay close attention to how she spends the family’s meager daily food budget of about 300 shillings (€2.30). Her first step was to switch to a cheaper brand of corn meal. It doesn’t taste of much, but at least it fills one’s stomach. She sometimes goes without her own lunch so that her children can have enough to eat.”

Well, because the masters of the universe have decided that, having exhausted the mortgage financialization, they needed to find another source of rent extraction, so, sorry Kenyan lady,  but the market says you need to pay more for food.

Of course, the article also lists the usual litany of possible other factors. However:

“Olivier de Schutter, the United Nations special rapporteur on the right to food, is one of the few who is trying to set the record straight. The production of biofuel and other “supply shocks” — such as crop failures and export bans — were “relatively minor catalysts,” he wrote recently. “But they set off a giant speculative bubble in a strained and desperate global financial environment.” He identifies the true culprits as major investors who, as the financial markets have dried up, have invested heavily in the commodities trade, expanding it beyond all proportion. According to de Schutter, excessive speculation is the primary cause of the price increases. Indeed, closer inspection reveals that the reasons cited to date for the price hikes on food products are somewhat dubious.”

Also, this:

And doesn’t this sound like a familiar story?

“But in order for the financial industry to tap this new business area, market access had to first be expanded. It was strictly regulated, and for good reason. The finance industry’s lobbyists got to work, and succeeded in 1999, when the US Commodities Futures Trading Commission substantially deregulated the futures markets. Now banks were permitted to hold large positions in commodities securities.

In 2004, the US Securities and Exchange Commission (SEC) expanded the banks’ scope for action when it approved a petition by the investment banks Lehman Brothers, Morgan Stanley, Bear Stearns and JP Morgan to relax equity capital rules. From then on, the financial professionals were able to trade with 40 times as much capital as they held in collateral. Even more play money flowed into the market.

But bets on individual commodities are highly risky, which initially deterred many investors. The banks needed a marketing idea, and Goldman Sachs had one, namely to bundle products together — an idea that seems suspiciously familiar in the wake of the subprime crisis. Index funds were created that contained a wide range of commodities futures, from oil to wheat. This spreads the risk and enables the funds to obtain a high credit rating, thereby heightening the appeal of the construct for major investors.

The trick is that speculators never convert the futures into real goods. The fund companies sell the contracts, which run for about 70 days, shortly before their maturity dates and use the fresh cash to invest in new futures. The system operates like a perpetual motion machine, with investors never coming into contact with the real market prices.

That’s precisely the point, say those who question whether speculators are responsible for rising commodity prices. They argue that the laws of supply and demand remain in force on the real, or spot, market, thereby bringing everything into equilibrium. In their view, whatever happens in the futures markets is irrelevant.

This is a fallacy. In reality, futures prices do affect real market prices, as Maximo Torero, director of the IFPRI’s Markets, Trade, and Institutions Division has learned. After taking a close look at the markets for corn, soybeans and wheat, he found that, in most cases, real prices followed futures prices. The anticipated future began changing the present.

Another factor is that rising futures prices encourage those who actually do own real goods to hoard their reserves, fueling prices even more.

In this manner, the financial industry’s involvement has thrown the once predictable food market completely out of balance.”

And we know that parts of the Arab uprisings have to do with rising food prices.

And this also leads to what Amartya Sen long ago called a failure of entitlements:

“The problem is particularly glaring in Ethiopia, a country whose name is associated with starvation for many people. Even though 5.7 million Ethiopians are dependent on international food aid, the government sells or leases large tracts of fertile land to foreign investors. They, in turn, export most of the food they produce to other countries.

Since 2007, the Ethiopian government has approved 815 foreign-funded agricultural projects. Saudi firms, multinational agricultural companies and British pension funds act as investors. Some 3.6 million hectares of land are up for grabs, much of it in the Gambela region, the proposed site of a national park. Now virgin forest is being cleared to produce food for other countries. Fifty kilometers (31 miles) outside the capital Addis Ababa, Jittu Horticulture, a subsidiary of a Spanish agricultural group, produces 180,000 kilograms (396,000 pounds) of vegetables a week. The produce is exported to the Middle East, supplying multinational oil companies and five-star hotels in Dubai, Qatar, Bahrain and Saudi Arabia.

“We bring foreign currency into the country, enabling the government to buy wheat for the hungry,” Dutch manager Jans Brins told the Berlin daily newspaper Tagesspiegel. “It’s the government’s responsibility to feed people who are unable to buy anything for themselves.”

That is precisely the problem: There is enough food, but it’s unaffordable for many people. Investors do not believe it is their responsibility to produce affordable food. Their job is to turn a lot of money into even more money. The British hedge fund Emergent Asset Management, for example, expects a 25 percent return on harvest profits and increases in the cost of farmland.

This much profit is normally unattainable with fallow land far from roads and water. Investors are usually drawn to developed areas with fertile soil, where they pursue intensive agricultural methods that tend to exacerbate rather than solve the problem of feeding the world in the long term.

As a result, the harm inflicted on the undernourished people of the world by investors and speculators is not limited to price increases. “It isn’t just that the wrong people are investing; they are also investing in the wrong things,” says Angelika Hilbeck of the Swiss Federal Institute of Technology Zurich.”

All these investors should be made to go live one year in these areas, without being allowed to use any of their bonuses to survive. See how they like the market then.

Anyway, read the whole thing. It will turn your stomach but it is worth it.

The Visual Du Jour – Food Fights

The idea of riots exploding when food becomes scarce or unaffordable is not new. This is something that has been discussed before in the context of what used to be called the “IMF riots”, that is riots caused by the implementation of structural adjustment programs in developing countries (“structural adjustment” is roughly equivalent to austerity + privatization). Often, it is when these measures impacted food and water that riots would explode.

So, it is not that far-fetched to suggest a correlation between food prices and revolts in the Middle East:

Maybe we are witnessing the internal version of resource wars combined with decades of bad governance where the “panem and circenses” rule of dictators does not work anymore. There is more entertainment to be had via satellite TV and the Internet and if food prices go up, then things explode.

As the article notes:

“Seeking simple explanations for the Arab spring uprisings that have swept through Tunisia, Egypt and now Libya, is clearly foolish amidst entangled issues of social injustice, poverty, unemployment and water stress. But asking “why precisely now?” is less daft, and a provocative new study proposes an answer: soaring food prices.

Furthermore, it suggests there is a specific food price level above which riots and unrest become far more likely. That figure is 210 on the UN FAO’s price index: the index is currently at 234, due to the most recent spike in prices which started in the middle of 2010.

Lastly, the researchers argue that current underlying food price trends – excluding the spikes – mean the index will be permanently over the 210 threshold within a year or two. The paper concludes: “The current [food price] problem transcends the specific national political crises to represent a global concern about vulnerable populations and social order.” Big trouble, in other words.

Now, those are some pretty big statements and I should state right now that this research, by a team at the New England Complex Systems Institute, has not yet been peer reviewed. It has been published because, Yaneer Bar-Yam, NECSI president, told me, the work is relevant now but peer review is slow.

The first part of the research is straightforward enough: plotting riots identified as over food against the food price index. The correlation is striking, but is it evidence of causation?

Bar-Yam says this conundrum can be tackled by asking the question in clear ways. Could the riots be causing high food prices, rather than the reverse? No, the former is local, the latter global. Could the correlation simply be a coincidence? Yes, there’s only a tiny chance of that, Bar-Yam’s team argues in the paper.

Lastly, could other factors be causing both the violence and the high food prices? “No-one has suggested any other factor that can do both,” says Bar-Yam. For example, oil and tin both show similar price patterns to that of food, but seem unlikely to prompt the violence. The similarity, says Bar-Yam, is because all the commodity price peaks are being driven by speculation in global markets.

Food Riots Are The Future

I think if there is one thing that exposes the failure of neoliberal governance through global institutions such as the IMF and the World Bank is the food regime. the global food regime is based on massive production out of the US and the EU through huge subsidies which hurt the agricultural sector in the periphery and leaves a lot of countries food-dependent. And that is combined with the IMF and the World Bank pushing for export-based agriculture in the periphery. This is a form of neo-colonialism.

Add to that the emerging effects of climate disruption that are already devastating parts of Africa and you have disasters waiting to happen. Because, as recent cases have shown, if there is one thing that people won’t stand for, it’s the lack of food:

“When grain prices spiked in 2007-2008, Egypt’s bread prices rose 37%. With unemployment rising as well, more people depended on subsidised bread – but the government did not make any more available. Egypt’s annual food price inflation continued and had hit 18.9% before the fall of President Mubarak.

Fifty per cent of the calories consumed by Egyptians originate outside its borders. Egypt is the world’s largest wheat importer, and no country in the region (except for Syria) produces more than a small fraction of the wheat it consumes. Should the global markets be unable to provide a country’s need, or if there are not enough funds available to finance purchases and to offer price support, then the food of the poor will become inaccessible to them. Already, in Egypt and Yemen, more than 40% of the population live below the poverty line and suffer from some form of malnutrition. Most of the poor in these countries have no access to social safety nets. Images of bread became central to the Egyptian protests, from young boys selling kaik, a breakfast bread, to one protester’s improvised helmet made from bread loaves taped to his head. Although the Arab revolutions were united under the slogan “the people want to bring down the regime” not “the people want more bread”, food was a catalyst.

“Bread riots” have been occurring regularly since the mid 1980s, following policies brought to us by the World Bank and the International Monetary Fund. Among these were the reduction of agricultural subsidies and the encouragement of production of fruits and vegetables for export, at the expense of investing in local grain production. Export of value-added produce and the import of basic commodities such as wheat were monopolised by a small group of “entrepreneurs” protected by the security state who financially backed the ruling elite. The powerful countries provided encouragement and support. The US gave Egypt around $1.7bn last year, exceeded only by the $2.4bn it gave to Israel. Tunisia under President Ben Ali was viewed as the IMF model of “growth” and France offered to support him militarily through the uprising.”

And in any situation like this, the question is cui bono? Who benefits?

“Three trading giants, Cargill, ADM and Bunge control 90% of the global grain trade. They are all based in the United States. We know that if we do not improve food security we will remain hostage to those in power.”

And this is a step in the right direction:

Already the Egyptian interim government has decided to support farmers who produce wheat instead of the importers. It is too early to tell the extent of the programme but advisers to the new Egyptian agriculture minister have confirmed that it includes higher prices paid for local wheat, seed supply, agricultural extension assistance and improved local storage and transport.”

And the alternative to the lack of food are socially devastating:

“In the past year, the UN’s World Food Programme has begun a project to try to end aid dependency in Karamoja and make the 1.2 million there people self-sufficient.

Food handouts are being strictly regulated, but many villagers are complaining of food shortages and charities report an increase in street begging by children.

“It’s getting worse because now there’s no food for the children, they all come back to Kampala to beg to earn a living,” says Maureen Mwagale, who runs a small charity called Kaana.

“These children are both physically and mentally abused.”

The children, as young as two, sit on the pavement of a busy shopping area, hands outstretched for money. We found two – Longorio, aged four, and his three-year-old cousin Lochien, being looked after by his 13-year-old sister, Nachiru Ellen.

She said she used to go to school but because of the lack of food in Karamoja her parents sent her to Kampala. Between the three of them, they had earned about $1 (£0.62) that day.

(…)

The landscape of Karamoja is cruel and arid, the people among the poorest in the world.

The UN’s experiment includes planting thousands of acres of robust crop like sorghum and cassava that can withstand drought, starting new businesses and bringing infrastructure and some economy to the area.

But even now, serious glitches have arisen. The UN has cut school meals because of what it describes as an administrative problem with the supply chain.

“We used to have breakfast, lunch and supper,” says Diko Ben, the headmaster of Loodoi Primary School. “Now there’s just a midday snack. Many here are now malnourished and if it stays like this, I don’t think you will see a future.”

Mr Ben says 200 children, a quarter of the whole school, have left because of the lack of food, adding that every child in school means one less under threat of being sent to beg in the cities.

The UN says meals will be restored by September and that, with the Ugandan government, it is drawing up a plan to end the crisis over Karamoja children. But it is not in place yet.”

We need a different food production regime… also one that uses less water. Otherwise, one should expect more food riots exploding across the periphery. There is only so much risk society that the global poor can deal with.

“A grotesque parody of the gastric bands used for slimming in the West”

Ugh:

“Increasing numbers of children are dropping dead on the long trek to refugee camps. Those who do get there are more severely malnourished than ever before. And, says the UN, the number of people under threat has now reached 11 million – equivalent to every man, woman and child in Belgium facing starvation. Thus, the chronic food crisis of the Horn of Africa edges with every hungry day towards full-blown famine.

One image captures the degrading awfulness now facing millions. It is not that of a wide-eyed, swollen-bellied child crying for food – although there are countless numbers of them. It is the sight of mothers using rope to bind their stomachs so they will deaden the pangs of hunger as they give what little food they can get to their children – a grotesque parody of the gastric bands used for slimming in the West.

This potentially life-threatening practice has been highlighted by ActionAid. Zippora Mbungo, an 86-year-old grandmother from Makima, Kenya, told the agency’s workers: “I tie this rope around my waist to hold my stomach in and avoid feeling hungry. Most of the time we have very little food, so I give it to my grandchildren first, leaving little or nothing for me. That is why I tie this rope around me. Only the rich people around here don’t tie a rope in times like this.” She added: “This is one of the worst droughts I have ever seen in my life.” Philip Kilonzo, of ActionAid Kenya, said: “This practice shows just how desperately hungry women are. But it can be lethal – women have died after suddenly untying their stomachs once food is available.””

But hey, nothing to do with climate disruptions there:

“The disaster, described by Unicef as “the worst humanitarian crisis in the world”, is the result of one of the most terrible droughts in 60 years, which has led to repeated harvest failures and the death of large numbers of livestock. About 2.9 million people in Somalia – a third of the population – need humanitarian aid, while some 4.5 million, out of a population of 80 million, are affected in Ethiopia. In Kenya, the region’s economic powerhouse, some 3.5 million are at risk of starvation, the UN says. Duncan Harvey, the acting country director for Save the Children in Ethiopia, said: “In terms of the sheer numbers of people affected, this is one of the worst droughts the world has seen in a long time.””

And because no disaster would be complete without some gender violence:

“Cases of rape and other violent attacks against women have doubled among refugees fleeing conflict and hunger in East Africa, according to member agencies of the Disasters Emergency Committee. Care International staff at two reception centres at the camp say reported cases have risen to 136 in the first six months of this year, compared with 66 in the same period in 2010. Ms Lopoukhine said: “The most dangerous period for refugees is when they are on the move. Women and girls are especially vulnerable to rape, abduction, illness and even being killed on the journey. Many women set out on the journey alone with their children, leaving husbands behind, and they may walk for weeks in search of food and safety.””

Go read the rest and if that does not make you sick enough, read the comments. They are especially vile in their rank racism and ignorance combined with colonial-style know-it-all, holier-than-thou smugness which allow one to watch other human beings die with a shrug and a “what’re gonna do” and “we got our problems too” attitude.

It’s trickle-down sociopathy in nasty times.

Starving the Periphery in Three Easy Steps

This validates Amartya Sen’s idea of failure of entitlement as the root of starvation and malnutrition.

Step 1: land grab (with government blessing and tax breaks on top)

“It’s the deal of the century: £150 a week to lease more than 2,500 sq km (1,000 sq miles) of virgin, fertile land – an area the size of Dorset – for 50 years. Bangalore-based food company Karuturi Global says it had not even seen the land when it was offered by the Ethiopian government with tax breaks thrown in.

Karuturi snapped it up, and next year the company, one of the world’s top 25 agri-businesses, will export palm oil, sugar, rice and other foods from Gambella province – a remote region near the Sudan border – to world markets.

Ethiopia is one of the world’s largest recipients of humanitarian food and development assistance, last year receiving more than 700,000 tonnes of food and £1.8bn in aid, but it has offered three million hectares (7.4 million acres) of virgin land to foreign corporations such as Karuturi.

“It’s very good land. It’s quite cheap. In fact it is very cheap. We have no land like this in India,” says Karmjeet Sekhon, project manager for what is expected to be one of Africa’s largest farms. “There you are lucky to get 1% of organic matter in the soil. Here it is more than 5%. We don’t need fertiliser or herbicides. There is absolutely nothing that will not grow on it.

(…)

Sparsely-populated Gambella is at the centre of the global rush for cheap land, precipitated by the oil price rise in 2007/2008, when many countries racked by food riots encouraged their farmers to invest abroad to grow food.

The lowest prices are in Africa, where, says the World Bank, at least 35 million hectares of land has been bought or leased. Other groups, including Friends of the Earth International, say the figure is higher. The Ethiopian government says 36 countries including India, China, Pakistan and Saudi Arabia have leased farm land there.

Gambella has offered investors 1.1 million hectares, nearly a quarter of its best farmland, and 896 companies have come to the region in the last three years. They range from Saudi billionaire Al Amoudi, who is constructing a 20-mile canal to irrigate 10,000 hectares to grow rice, to Ethiopian businessmen who have plots of less than 200 hectares.

This month the concessions are being worked at a breakneck pace, with giant tractors and heavy machinery clearing trees, draining swamps and ploughing the land in time to catch the next growing season.

Forests across hundreds of square km are being clear-felled and burned to the dismay of locals and environmentalists concerned about the fate of the region’s rich wildlife.”

I am sure this will do wonder to feed the local population. But after all, neoliberal agencies of global governance have encouraged peripheral governments to do this for a long time. Comparative advantage and all.

And part of the land grab has to do with Western biofuel production.

Step 2: Speculate!

“But a new theory is emerging among traders and economists. The same banks, hedge funds and financiers whose speculation on the global money markets caused the sub-prime mortgage crisis are thought to be causing food prices to yo-yo and inflate. The charge against them is that by taking advantage of the deregulation of global commodity markets they are making billions from speculating on food and causing misery around the world.

(…)

There has always been modest, even welcome, speculation in food prices and it traditionally worked like this. Farmer X protected himself against climatic or other risks by “hedging”, or agreeing to sell his crop in advance of the harvest to Trader Y. This guaranteed him a price, and allowed him to plan ahead and invest further, and it allowed Trader Y to profit, too. In a bad year, Farmer X got a good return but in a good year Trader Y did better.

When this process of “hedging” was tightly regulated, it worked well enough. The price of real food on the real world market was still set by the real forces of supply and demand.

But all that changed in the mid-1990s. Then, following heavy lobbying by banks, hedge funds and free market politicians in the US and Britain, the regulations on commodity markets were steadily abolished. Contracts to buy and sell foods were turned into “derivatives” that could be bought and sold among traders who had nothing to do with agriculture. In effect a new, unreal market in “food speculation” was born. Cocoa, fruit juices, sugar, staples, meat and coffee are all now global commodities, along with oil, gold and metals. Then in 2006 came the US sub-prime disaster and banks and traders stampeded to move billions of dollars in pension funds and equities into safe commodities, and especially foods.”

Step 3: Don’t forget the Whole Foods crowd! They have needs too!

“It is the “lost crop” of the Incas, a health-giving seed found in the Andes which is increasingly providing the garnish on fashionable Western dinner plates. But while demand for quinoa has given a lifeline to Bolivia’s farmers, the native population, no longer able to afford a staple of the national diet, is now facing the threat of malnutrition.

(…)

Entrepreneurial Bolivians are returning from the city to cultivate quinoa plots in the countryside. But the country’s agriculture ministry is reporting that as prices have risen national quinoa consumption has slumped by 34 per cent over five years, with local families no longer able to afford a staple that has become a luxury. A 1kg bag of quinoa costs almost five times the amount of its rice equivalent in local stores.

Bolivia has long suffered from a malnutrition problem and there are fears that the population will be forced to turn to cheaper, processed foods. Children in the quinoa- growing south of the country are among those showing chronic malnutrition symptoms.

Evo Morales, Bolivia’s President, is promising a $10 million loan facility for farmers to grow more quinoa designed for domestic consumption. But there is a growing North American export market to satisfy and global food commodity prices are continuing to rise.”

Hey, who said the market did not allocate resources, goods and services efficiently, from the periphery to the core, just as it should be!

What is disheartening is that for each article I just linked to in this post, the first comment is usually of the Malthusian kind. People, we do not have a food production problem. We have again, what Sen calls entitlement failure as opposed to food availability decline, something I have already discussed here.

Public Policy as Individual Disciplining v. Systemic Change

In this article, French magazine Rue89 goes over the various policies Western governments are trying out to reduce their levels of obesity:

As the article notes, there are roughly four approaches to dealing with obesity:

1. Prevention. This involves campaign encouraging people to eat more fruits and vegetables or to implement aggressive labeling to let customers know what they are buying (something the food industry vehemently opposes, by the way). In England, this has taken the form of vouchers given to low-income people for healthy products from selected brands (like big food companies).

2. Regulations on advertising and limit on advertising on soda and other unhealthy products (they are already banned in Sweden and Canada). In France, unhealthy and sugary snacks and sodas are no longer allowed in public schools. In Mexico, low quality food is not allowed to be sold in schools and 30 minutes of exercise a day are mandatory.

3. Taxation. We have heard over and over that obesity is socially and economically costly. So, obese people should be taxed to somewhat offset the cost of accommodating them through higher health care premiums (implemented in some US states). A “fat tax” would obviously hit the poorest harder. An alternative would be to tax more heavily unhealthy and fast food products.

4. Incentives. Pay people to lose weight (pilot tested in the UK).

See what’s missing here?

What is missing is

1. Why are people overweight? The measures above clearly assume that it is all about individual behavior, with limited social influence (through advertising). Social explanations are grossly missing: suburbanization and the pervasive use of cars because walking in impossible. How many kids walk to schools outside of inner cities? How many people walk to the market or the grocery store? It is probably not possible because of housing development patterns and the lack of pedestrian structure.

Also, we do not work in farms or factories, anymore. Most of us work in service jobs, in fornt of computers for a significant amount of time every day. Joining gyms is expensive and out of reach for low-income people.

2. Who makes the food we eat? Where is the critical examination and evaluation of the role of agribusiness, Big Food and Big Corn in putting unhealthy food, loaded with high fructose corn syrup, genetically modified vegetables, hormone-growth-and-antibiotics-laden sick meat.?

Basically, what is missing is this (full film):

And this (playlist):

What is missing is an analysis of the food system in which we exist and that feeds us. So, on this again, public policy takes the form of punishment and shaming, and disciplining of the lower classes rather than actual policy that involves critically examining the social structure of food and overall living conditions that foster obesity. This would also mean reexamining the agricultural policy of the US, with its subsidies to agribusiness.

And such initiatives are doomed to fail for several reasons: (1) the poor have less leisure time than the wealthy. When would they find the time to exercise? (2) They cannot afford to shop at Whole Foods. Eating healthy is dreadfully expensive. (3) These policies do not touch the roots of obesity. They do not offer to reorganize workplaces / work rhythms / work life.

Your [Big Chain Cardboard-Tasting] Pizza is Killing Farmers

Via Mitch Wagner, you must read this (yes, fairly longish but well worth it) article on the global social and economic consequences of Big Pizza. I’ll extract just a few snippets:

“But what if that large pie delivered to your doorstep costs more than you think? A number of economists, sociologists, and food scholars claim that the $36 billion-a-year success of Big Pizza has ominous undertones and implications that reach far beyond weighty matters like deciding between extra cheese and anchovies. They argue that the unrelenting push for ever-cheaper pizza ingredients is hurting the planet and driving small and medium-size farms out of business. Some of these farmers feel they have no choice but to move to the megacities sprouting across the globe. Once relocated to urban slums, many find themselves among the estimated 1.1 billion people earning less than $1 a day, an amount that makes it hard to survive, let alone afford Domino’s recent special offer of $5.99 a pie for two medium pizzas. Of the farmers that decide to stay put, some opt for a quicker death, at their own hand.

“We are faced with two possible futures,” says sociologist Harriet Friedmann, Ph.D., a professor of geography and planning at the University of Toronto. “One is a diversity of crops, of cultures, and of cuisines that can inhabit ecosystems sustainably and produce healthy food for urban centers. The other is long-distance food from nowhere, monocultural systems that aren’t sustainable, and simplified diets, especially for the poor. Global pizza typifies the second option.”

Another outspoken opponent of the circumstances underlying the worldwide pizza trade has been Philip McMichael, Ph.D., a professor of development sociology at Cornell University. He believes that the combined processes of bioindustrialization, the ever-increasing reliance of agro-industry on fossil fuels, and the relentless search for the most rapidly expanding overseas markets has led to a phenomenon he calls “the food regime.” The machinations that lie behind this new world order perform very well when it comes to churning out profits for transnational corporations, but that success comes at considerable social and economic expense, says McMichael. “It’s undermining people who make their living off the land everywhere.””

Sheesh, leave it to the sociologists to be wet blankets. And like Cassandra, they’re never believed, so, the reporter decided to investigate the whole “Big Pizza” process himself.

Tomatoes:

“It may come as no surprise that the customer base and the economic challenges that concern Peters and Paradise Tomato Kitchens belong to Domino’s, Pizza Hut, Papa John’s, and Little Caesars–not to the world’s tomato growers. Indeed, as Big Pizza’s preference for globalized sauce has matured, many of the other farmers who used to make a living growing and selling tomatoes have been pushed out of business.

In Ghana, for example, locally harvested tomatoes were once a staple. But tomato concentrate has destroyed the market there–not to mention the lives of the nearly 2 million people involved in tomato cultivation in one region of the country. Despite Ghana’s farming tradition, it has become the world’s second-largest importer of process tomatoes, after Germany. As a result, according to the Peasant Farmers Association of Ghana, more than 700 tomato farmers have gone belly-up.

“We do not get good prices for the little harvest,” said Comfort Mantey, a tomato farmer in the Ghanaian community of Matsekope, when she was interviewed for a report on poverty in the region. “The traders tell us their customers now mix fresh tomatoes with imported tomato paste.”

Another tomato farmer, Martin Pwayidi, defaulted on the $2,000 loan he had secured from a bank and sunk into his 4 acres in 2008; no one would buy locally grown tomatoes from him. “I lost everything,” said Pwayidi to one African news outlet. “There was absolutely no reason to live.”

Sadly, this is the same conclusion arrived at by many of Pwayidi’s neighbors: Annual waves of suicides have washed across Ghana’s northern growing regions as some desperate farmers ingested the insecticide they no longer needed for their tomatoes.”

Cheese:

“About half the U.S. milk supply is used to manufacture cheese, and last year’s 10 billion pounds broke all previous production records. Mozzarella recently topped Cheddar as the most popular cheese variety. And where does all that mozzarella go? Onto your pizza, of course.

(…)

According to the most recent data, Leprino must buy an astonishing 5 to 7 percent of the total available U.S. milk in order to supply mozzarella to Domino’s and Pizza Hut and everybody else in global pizza.”

And, of course, mozzarella comes from milk and milk farmers are being squeezed by Big Cheese:

“”Farmers have never received less money for their milk,” says John Bunting, a dairyman from the western foothills of the Catskills, in New York State, who also writes a blog that focuses on the plight of dairy farmers. For instance, the area where Bunting lives used to be rich in milk production; as the price of milk has touched bottom, though, it has been plagued by debt and bankruptcy. “There is no one in the country making a living milking cows,” he says. “Not this year, and not last year, either. I get calls every day from just plain desperate farmers. Nobody knows what to do.”

Of course, as the country’s small dairy farmers head into bankruptcy, the largest producers of cheese have prospered. “Kraft and Leprino are on tight margins,” says Bunting. “But they have so many units running past the cash register that Jimmy Leprino can get rich.”

Last year was the worst in at least 30 years for small-scale dairymen, who lost money on every cow on every day of every month, says Bunting. Despite the losses, one upstate New York farmer, Dean Pierson, refused to let go of the 51 milking cows on the land his father had bought. Instead, Pierson took a small-caliber rifle and went through the barn he had built and shot each of his cows through the head. Then he sat down on a chair and put a bullet through his chest.”

And pepperoni:

“”Meat has moved from the periphery of human diet to its center,” says Tony Weis, Ph.D., a geography professor at the University of Western Ontario. “The least efficient converter of feed-to-flesh output is beef cattle,” he adds. He points out that this inefficiency means cattle have much larger land, water, and energy budgets than most people realize. Diverse small farms tend to be much better converters of land and resources into protein and other nutrients than are the grain-fed cattle. As more than a billion farmers in the developing world are going broke, more than a billion cattle are reared on the backs of subsidies. And as the world’s desire for cheap meat increases, so does the need for more acres of corn and wheat for feed, along with devastating increases in all the accompanying diesel fuel, fertilizers, pesticides, and herbicides. In fact, overall, agriculture is responsible for about 30 percent of total emissions of greenhouse gases, and livestock accounts for more than half of that.

“You have an increasing global demand for pepperoni pizza,” says Weis. “How is this going to be sustained with near-term rising energy costs when so much fossil energy is embedded in the pepperoni?””

And, of course, this does not even take into account the health consequences of this. For instance, the fact that more and more people are acid reducers on a permanent basis, the obesity issue due to eating that stuff. So, cheap pizza comes at the price of increased health care costs.

And as a French person, I would add that it comes at the cost of younger generations not knowing what real food tastes like, which is a shame.

Anyway, as they say, go read the whole thing.

Let Them Eat Derivatives – The Coming Food Crisis

I have already blogged about the gathering storm that is the coming food crisis due to a series of factors not entirely related to low production:

“Rising food prices and shortages could cause instability in many countries as the cost of staple foods and vegetables reached their highest levels in two years, with scientists predicting further widespread droughts and floods.

Although food stocks are generally good despite much of this year’s harvests being wiped out in Pakistan and Russia, sugar and rice remain at a record price.

Global wheat and maize prices recently jumped nearly 30% in a few weeks while meat prices are at 20-year highs, according to the key Reuters-Jefferies commodity price indicator. Last week, the US predicted that global wheat harvests would be 30m tonnes lower than last year, a 5.5% fall. Meanwhile, the price of tomatoes in Egypt, garlic in China and bread in Pakistan are at near-record levels.”

So why the concern? Well, climate uncertainties are one:

“”Prices are volatile and there is a lot of nervousness in the market. There are big differences between now and 2008. Harvests are generally better, global food stocks are better.”

But other analysts highlight the food riots in Mozambique that killed 12 people last month and claim that spiralling prices could promote further political turmoil.

They say this is particularly possible if the price of oil jumps, if there are further climatic shocks – suchas the floods in Pakistan or the heatwave in Russia – or if speculators buy deeper into global food markets.”

Also, think failure in global governance:

“”The food riots in Mozambique can be repeated anywhere in the coming years,” said Devinder Sharma, a leading Indian food analyst.

“Unless the world encourages developing countries to become self-sufficient in food grains, the threat of impending food riots will remain hanging over nations.

“The UN has expressed concern, but there is no effort to remove the imbalances in the food management system that is responsible for the crisis.””

Well that is a bit rich. Developing countries have been encouraged, if not forced, to import food because they cannot compete with the heavily subsidized agricultural products of the US and the EU. And now, they are being told to become food self-sufficient.

And that is even before mentioning the farm land grab currently going:

“UN special rapporteur on the right to food, Olivier de Schutter, says a combination of environmental degradation, urbanisation and large-scale land acquisitions by foreign investors for biofuels is squeezing land suitable for agriculture.

“Worldwide, 5m to 10m hectares of agricultural land are being lost annually due to severe degradation and another 19.5m are lost for industrial uses and urbanisation,” he says in a new report.

“But the pressure on land resulting from these factors has been boosted in recent years by policies favouring large-scale industrial plantations.

“According to the World Bank, more than one-third of large-scale land acquisitions are intended to produce agrofuels.””

And finally, now that the mortgage bubble has burst, with the consequences that we know, investors have to bet and gamble on something else. Food is their current favorite:

“But the current global conflagration owes more to market forces than the forces of nature. Raw materials are the new target for investors who have plenty of money to play with, generously supplied by the Central Banks, free (or almost free) of charge. After betting on property, the financial whiz kids are turning to basic commodities, such as non-ferrous metals, and agriculture.

Last month the London hedge fund Amajaro bought a quantity of cocoa equivalent to 25% of all European stocks, and a few days later the price per tonne broke all records. The same thing is happening with wheat, rice and soya. European leaders are all upset, and some have gone so far as to speak of a need for regulation – exactly what they said during the sub-prime crisis. The consequences for developing countries are particularly serious because the International Monetary Fund and World Bank have encouraged them to turn to foreign markets and abandon local production. Unctad now recognises, at least on paper, that “a sustainable growth strategy requires a greater reliance on domestic demand” and that “this may call for a rethinking of the paradigm of export-led development”. Better late than never. A pity that all they offer is pious platitudes, which may foster our illusions but won’t feed the planet.”

And when the food riots riot, the Western media will collectively invoke ancestral hatred and whisper about savagery.