One paradox at the heart of the present world food crisis is that the same market forces which threaten to starve millions in the developing world are the ones that have led to chronic overconsumption and an obesity epidemic in the west. We may live in an age of abundance, but it is also one marked by extreme inequality: every day 800 million people go hungry, even more than a billion others are overweight. Between 1981 and 2004 the World Bank estimates that cheaper food allowed 400 million people to escape from extreme hunger, but many of them will fall back into a cycle of poverty and starvation unless they are quickly given some relief from the gross inflation of food prices currently underway.Ironically, development has contributed to the crisis. India and China’s growing middle classes have begun to eat more like Europe and America, and their demand for expensive foods – particularly meat – has helped to drive global food markets to dangerously high levels. But that is only one part of the problem. Several Indian economists, angered by what they see as America’s scapegoating for its own hyperconsumption, have argued that the entire system needs an overhaul if similar crises are to be avoided in the future. Everyone’s conscience could do with a little prodding. Pradeep Mehta of the American-based research institute CUTS International recently told the New York Times that if “Americans slimmed down to the weight of middle-class Indians, ‘many hungry people in sub-Saharan Africa would find food on their plates.’”
A sobering article in the New Yorker warns that “[o]ur ability to produce vastly too many calories for our basic needs has skewed the concept of demand, and generated a wildly dysfunctional market.” Blinded by profit, the giant companies which dominate the world’s food markets have tolerated a number of questionable practices long enough for them to become routine. As a result, it is difficult to achieve market reforms, however desirable, since these would disrupt important economies of scale. Consider chickens: thirty years ago “it took ten weeks to raise a broiler; now it takes forty days in a dark and crowded shed, because farmers are under constant pressure to cut costs and increase productivity.” The ‘pale, soft, exudative’ meat that emerges from this accelerated process may be much less appetizing and healthy, but it has allowed US suppliers to provide the average consumer with 87 pounds of chicken a year – an amount that has doubled since 1980. Even though the law of diminishing returns has taken its toll on the market – US chicken farmers now make a profit of only two cents per pound – too much money has been invested in its workings for serious short-term reforms to be politically or economically practical.
In classic economic theory, markets adapt to new conditions. A surplus of one commodity triggers demand for others. Unfortunately, food markets don’t work quite like that. Once we have grown accustomed to eating a certain way, we are loathe to change even when it makes economic sense to do so. Our appetites are also notoriously elastic and open to manipulation – Mexico, for example, currently consumes more Coca-Cola than milk. The developed world has grown used to a cheap supply of wheat, corn, beef and chicken – this is not likely to change any time soon. Is it realistic, then, to expect the huge agribusinesses which have fuelled this demand to reform their supply networks simply because the poorer parts of the world can no longer afford their products?
Part of the problem stems from the inherent biases of globalization. The hedge fund manager George Soros recently observed that the global economy has “an asymmetric structure. It favours the United States and other developed countries at the centre of the financial system and penalizes the less-developed economies at the periphery. The disparity between the centre and the periphery is not widely recognized, but it has played an important role in the development of the super-bubble [behind the 2008 credit crisis].” The same, of course, is true of the way the world food market operates. But if those at the centre of either system cannot – or will not – accept the responsibility to bring about the necessary changes, what hope for the periphery?
Guyana has always had the potential to feed itself and the Caribbean, many times over. But despite a generation of political rhetoric we have never developed an economy that made this viable. Perhaps the advent of the global food crisis is the moment to rethink our approach to agriculture. To consider our place in the vast chain of supply and demand that drives the world food markets. For even though we can’t shield ourselves from the end of cheap food, we may yet be able to offset some of its ill effects by making ourselves more self-sufficient, and competitive in the global food markets.
