Tuesday, March 01, 2011

The Scariest Story You Will Read Today

There's been an undercurrent in the news these past few weeks that should terrify the pants off you.
As global climate changes, creating scarcity in formerly fertile areas and creating new fertility in areas not used to feast, all the while increasing food pressure in regions that were already drought stricken, we're seeing a nexus of factors start to accumulate.
Of course, there are the natural disasters: flooding AND drought in Australia would be first and foremost on the list of examples, but also long-term famine in Africa, and severe flooding in Bangladesh that washes away the few inches of fertile soil available for planting.
More, however, are the gutless capitalist humans who decide they need to take economic advantage of other people's suffering. The events in Cote D'Ivoire seem pretty trivial, when apparent President Alassane Ouattara declared an embargo on cocoa and coffee exports until his opponent left office, until you realize that food was being used to blackmail and bludgeon a political opponent.
And that's probably not the worst of it.
If you consider that the price of corn has doubled since 2009, the price of wheat has more than doubled, soy has risen over 50%, and sugar is the highest its been in 30 years, these can't all be explained by natural processes. Sure, water's been a problem in Russia, but not in the midwest, and while ethanol has had some impact on corn prices, you can't account for a doubling in price based on ethanol production.
There is much food speculation going on and that's the real secret of this crisis-to-be. Remember, the Arab and Muslim world accounts for 33% of the global food exchange...it's really hard growing food in a desert...and so the wild swings we've seen over the past week or so are due in large part to people reacting to the various uprisings in the Middle east and North Africa.
After all, there's profit to be made here! If it was just based on natural factors, food prices wouldn't oscillate with such fervor and intensity. There has to be a human element. This is Enron writ large.