How sad the rain soundsOn the cardboard roofs How sad that my people liveIn cardboard houses

The worker is coming downAlmost dragging his feetFrom the weight of sufferingLook how much he suffersLook how much the suffering weighs

Children the color of earthWith their same scarsMillions of tapewormsAnd that's whyThe children live sadlyIn cardboard houses

How happy it is that dogs live inThe exploiter’s houseYou are not going to believe itBut there are schools for dogsWhere they train themNot to bite the newspapers But the Boss!For many, many yearsHe’s been biting the worker

QuickTime™ and a decompressor

are needed to see this picture.

The World Food Crisis

Fred Magdoff

fmagdoff@uvm.edu

QuickTime™ and a decompressor

are needed to see this picture.

1.) There is a catastrophic food crisis.2.) In addition to “routine” hunger.3.) It is interacting with a longer term underlying food crisis and making it worse.

1.) There is a catastrophic food crisis.2.) In addition to “routine” hunger.3.) It is interacting with a longer term underlying food crisis and making it worse.

In cities = 3 billion people

A Broad Overview

Total world population = 6 billion people

In rural areas = 3 billion people

• 3 billion live on less than $2 3 billion live on less than $2 per dayper day• 1 billion live on less than $1 1 billion live on less than $1 per day per day • 1 billion live in slums1 billion live in slums• 25 million per year migrate to 25 million per year migrate to citiescities• 1 billion have no access to 1 billion have no access to clean waterclean water• 2 billion have no electricity2 billion have no electricity• 2.5 billion have no sanitation 2.5 billion have no sanitation systemssystems

The Wretched of the Earth The Wretched of the Earth

Hunger Hunger

•The UN estimates that 840 million people suffer from undernourishment, although the number may be considerably higher.

•The number suffering from mineral shortages, food insecurity and temporary food shortage may approach 3 billion.

World Bank Counts More Poor People

Washington Post StaffAugust 27, 2008Far more people around the world live in severe poverty than previously thought, with the global underclass now numbering an estimated 1.4 billion, up from around 1 billion, according to a landmark World Bank report released yesterday.

World Bank Counts More Poor People

Washington Post StaffAugust 27, 2008Far more people around the world live in severe poverty than previously thought, with the global underclass now numbering an estimated 1.4 billion, up from around 1 billion, according to a landmark World Bank report released yesterday.

Hunger amid plenty in the

U.S.

Hunger amid plenty in the

U.S.

• In 4 million U.S. families (with 9 million people) someone skipped meals because of lack of food. • 12 million U.S. families (with about 34 million people) are “food insecure.” • Huge increases in the last decade in those using food pantries, food

shelves, soup kitchens, etc.

Hunger frequently occurs amid plenty in poor

countries too

Hunger frequently occurs amid plenty in poor

countries too

Poor in India Starve as Surplus Wheat Rots (New York Times, 12/12/02)

Want Amid Plenty, An Indian Paradox: Bumper Harvests and Rising Hunger (Wall St. Journal, 6/25/04)

There is enough food produced world wide—and usually within

most countries—to feed everyone.

There is enough food produced world wide—and usually within

most countries—to feed everyone.

Because they are poor (working or not) and living in an economic system that

a) needs, creates, and maintains an underclass, and that

b) does not admit a “right” to basic necessities such as food.

Why are people hungry? Why are people hungry?

It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their

own interest.—Adam Smith

It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their

own interest.—Adam Smith

Survey offers glimpse into lives of state’s 170,000 farmworkers

Seattle (AP), August 14, 2008

…sub-par housing conditions plagued by mice, cockroaches and lack of electricity or water.

… workers have an average annual household income of around $17,500 - below the federal poverty line. Nearly 6 percent of the 2,800 workers described themselves as homeless, living in cars or sheds.

…sub-par housing conditions plagued by mice, cockroaches and lack of electricity or water.

… workers have an average annual household income of around $17,500 - below the federal poverty line. Nearly 6 percent of the 2,800 workers described themselves as homeless, living in cars or sheds.

Food is no different than any other commodity—

AutomobilesJewelryClothingBooks, etc., etc.

Food is no different than any other commodity—

AutomobilesJewelryClothingBooks, etc., etc.

The availability of food to people reflects very unequal economic and political power relationships within and between countries.

The availability of food to people reflects very unequal economic and political power relationships within and between countries.

Quintile

Highest

Fourth

Third

Second

Lowest

Percent of total U.S. national income (2001)

49.2

23.2

15.0

9.0

3.6

Household distribution of net worth in the United States (2001)

Percent of families

Top 1%

Top 5%

Top 10%

Top 20%

Bottom 80%

Bottom 40%

Percent of net worth

33.4

59.2

71.5

84.4

15.5

0.3

Richest 400 Americans have a net worth of $1.6 trillion

More than the wealth of the bottom 150 million people

QuickTime™ and a decompressor

are needed to see this picture.

QuickTime™ and a decompressor

are needed to see this picture.

Bangladeshi demonstrators protest over high food prices and low wages

Bangladeshi demonstrators protest over high food prices and low wages

The Current Crisis

Rioting in response to soaring food prices recently has broken out in Egypt, Cameroon, Ivory Coast, Senegal and Ethiopia. In Pakistan and Thailand, army troops have been deployed to deter food theft from fields and warehouses.

Rioting in response to soaring food prices recently has broken out in Egypt, Cameroon, Ivory Coast, Senegal and Ethiopia. In Pakistan and Thailand, army troops have been deployed to deter food theft from fields and warehouses.

QuickTime™ and a decompressor

are needed to see this picture.

Food Inflation, Riots Spark Worries for World Leaders

— Wall Street Journal, April 14, 2008

Food Inflation, Riots Spark Worries for World Leaders

— Wall Street Journal, April 14, 2008

Rioting in response to soaring food prices recently has broken out in Egypt, Cameroon, Ivory Coast, Senegal and Ethiopia. In Pakistan and Thailand, army troops have been deployed to deter food theft from fields and warehouses. World Bank President Robert Zoellick warned in a recent speech that 33 countries are at risk of social upheaval because of rising food prices. Those could include Indonesia, Yemen, Ghana, Uzbekistan and the Philippines. In countries where buying food requires half to three-quarters of a poor person's income, "there is no margin for survival," he said.

Rioting in response to soaring food prices recently has broken out in Egypt, Cameroon, Ivory Coast, Senegal and Ethiopia. In Pakistan and Thailand, army troops have been deployed to deter food theft from fields and warehouses. World Bank President Robert Zoellick warned in a recent speech that 33 countries are at risk of social upheaval because of rising food prices. Those could include Indonesia, Yemen, Ghana, Uzbekistan and the Philippines. In countries where buying food requires half to three-quarters of a poor person's income, "there is no margin for survival," he said.

The world's poor ``are living very close to the edge as it is…If they are pushed further, they are typically the first who will spark unrest.'’

— Robert Zeigler, director-general of the International Rice Research Institute in the Philippines.

The world's poor ``are living very close to the edge as it is…If they are pushed further, they are typically the first who will spark unrest.'’

— Robert Zeigler, director-general of the International Rice Research Institute in the Philippines.

Rising prices threaten millions with starvation, despite bumper crops

The Independent (UK)Sunday, 2 March 2008

There has never been anything remotely like the food crisis that is now increasingly gripping the world, threatening millions with starvation. For it is happening at a time of bumper crops.

Rising prices threaten millions with starvation, despite bumper crops

The Independent (UK)Sunday, 2 March 2008

There has never been anything remotely like the food crisis that is now increasingly gripping the world, threatening millions with starvation. For it is happening at a time of bumper crops.

20%

39%

122%40%51%

WSJ, Oct. 15, 2008

Effects in U.S. are less than in poor countries

Effects in U.S. are less than in poor countries

a) Ingredients are small part of price of highly processed foods.

b) In U.S. people have higher incomes and spend less a % of their income on food (10-20% vs 70-80%+).

a) Ingredients are small part of price of highly processed foods.

b) In U.S. people have higher incomes and spend less a % of their income on food (10-20% vs 70-80%+).

Causes of Current Crisis

• Increase in fuel prices

a) Use of significant amount of crop land to produce crops for biofuels (20 % of U.S. corn used for ethanol production in 2007).

• Increase in fuel prices

a) Use of significant amount of crop land to produce crops for biofuels (20 % of U.S. corn used for ethanol production in 2007).

b) Conventional large scale agricultural production is VERY energy intensive: machinery, fuel, irrigation, pesticides, fertilizers (esp. N — DAP has close to tippled in price), drying, etc.

b) Conventional large scale agricultural production is VERY energy intensive: machinery, fuel, irrigation, pesticides, fertilizers (esp. N — DAP has close to tippled in price), drying, etc.

But it’s not just ethanol: also problems with biodiesel primarily from soybeans and oil palm

• Increase in meat consumption (Per capita consumption has more than doubled in last 50 years.)

• Formerly self-sufficient countries now importing food.

• Weather (Australia, Bangladesh)

• Speculation (local hoarding as well as speculation in the “commodities super cycle.”)

• Increase in meat consumption (Per capita consumption has more than doubled in last 50 years.)

• Formerly self-sufficient countries now importing food.

• Weather (Australia, Bangladesh)

• Speculation (local hoarding as well as speculation in the “commodities super cycle.”)

Wall Street Grain Hoarding Brings Farmers, Consumers Near Ruin

Bloomberg April 28, 2008

Commodity-index funds control a record 4.51 billion bushels of corn, wheat and soybeans through Chicago Board of Trade futures, equal to half the amount held in U.S. silos on March 1.

Wall Street Grain Hoarding Brings Farmers, Consumers Near Ruin

Bloomberg April 28, 2008

Commodity-index funds control a record 4.51 billion bushels of corn, wheat and soybeans through Chicago Board of Trade futures, equal to half the amount held in U.S. silos on March 1.

Governmental ResponsesGovernmental Responses

• Emergency imports• Eliminating import duties• Freezing exports of foods• More food subsidiesetc.

Governmental ResponsesGovernmental Responses

Bush Orders $200 Million in Food AidBy Associated Press4:31 PM EDT, April 14, 2008

(A congressional analysis shows the Iraq war costing taxpayers almost $2 billion a week.)

Food crisis billions failing to arrive, warn reports

guardian.co.uk, Oct. 16, 2008

Food crisis billions failing to arrive, warn reports

guardian.co.uk, Oct. 16, 2008

Two Ugandan women drag sacks of food relief

Business ResponsesBusiness Responses

• Rapid increase in land prices in US and abroad• Increased deforestation in Amazon• Corporations and private capital

purchasing land abroad (Brazil, Uruguay, Argentina, etc.)• Large profit possibilities

Profit increase for some of the world’s largest fertilizer corporationsCompany Profits 2007 (US$ million) % inc. from 2006 Potash Corp (Canada) 1,100 72%Yara (Norway) 1,116 44%Sinochem (China) 1,100 95%Mosaic (US) 708 141%ICL (Israel) 535 43%K + S (Germany) 420 2.8%e

Table 2. Profit Increase for Some of the World's Largest Grain Traders

Company

Profits 2007 (US$ million)

Increase from 2006 (%)

Cargill (US) 2,340 36%

ADM (US) 2,200 67%

ConAgra (US) 764 30%

Bunge (US) 738 49%

Noble Group (Singapore)

258 92%

The long-term crisisThe long-term crisis

• Eliminate tariffs (that protect local industries)

• Allow free flow of capital (in and out of country)

• Concentrate on industries/products for which country has a “comparative advantage.”

• Decrease government spending (especially food and agricultural production subsidies, privatize government services).

The “Washington Consensus” (The “Neoliberal” Approach) of the IMF, World Bank, and aid

agencies—one size fits all—

The long-term crisisThe long-term crisis

Let the “free market” work.Let the “free market” work.

In most reforming countries, the private sector did not step in to fill the vacuum when the public sector withdrew.

— Independent Report Commissioned by the World Bank (Fall 2007)

In most reforming countries, the private sector did not step in to fill the vacuum when the public sector withdrew.

— Independent Report Commissioned by the World Bank (Fall 2007)

The whole thing was based on the idea that if you take away the government for the poorest of the poor that somehow these markets will solve the problems....But markets can’t step in and won’t step in when people have nothing. And if you take away help, you leave them to die.

—Jeffery Sachs, 2007

The whole thing was based on the idea that if you take away the government for the poorest of the poor that somehow these markets will solve the problems....But markets can’t step in and won’t step in when people have nothing. And if you take away help, you leave them to die.

—Jeffery Sachs, 2007

The long-term crisisThe long-term crisis

“Neoliberal” Economic Policies

Decreased support to small farmers

Lowered food production by small farmers

Increased migration to city slums

Increased number and size of larger farms

Increased penetration and control by transnational agribusiness

“Neoliberal” Economic Policies

Decreased support to small farmers

Lowered food production by small farmers

Increased migration to city slums

Increased number and size of larger farms

Increased penetration and control by transnational agribusiness

UAE, Saudis Seek Supply

Wall St. Journal August 26, 2008

DUBAI -- The United Arab Emirates and Saudi Arabia are seeking agricultural-investment opportunities in a handful of developing countries, including Sudan and Pakistan, in an effort to meet rising food demand, according to officials.

UAE, Saudis Seek Supply

Wall St. Journal August 26, 2008

DUBAI -- The United Arab Emirates and Saudi Arabia are seeking agricultural-investment opportunities in a handful of developing countries, including Sudan and Pakistan, in an effort to meet rising food demand, according to officials.

• Fewer than 20 million highly productive and mechanized farmers can grow all the world’s food.

(Note: one person in Brazil — the governor of the state of Mato Grosso, the “soybean king” — controls about 500,000 acres.)

• Fewer than 20 million highly productive and mechanized farmers can grow all the world’s food.

(Note: one person in Brazil — the governor of the state of Mato Grosso, the “soybean king” — controls about 500,000 acres.)

The Future?

The Future?

If 20 million farms can produce all world food needs — regardless of where the farms are located — what will be the fate of billions of people that will not find other employment?

The Future?

One of the great moral, economic, and political issues

of the 21st century.

How can poor nations keep the large mass of people in rural areas productively employed in agriculture?

• A healthy food supply should be recognized as a human right.

• Policies should be implemented to ensure that people have access to sufficient food—in all countries.

• Protection of, and active government support for, agriculture.

• Developing agriculture — primarily to provide food for their own people — needs to be a priority for poor countries.

• Promote farming carried out by small to medium producers working alone or in cooperatives.

• Promotion of appropriate — ecologically sound — practices.

• Institute land reform where needed (Brazil, Venezuela, South Africa, the Philippines, etc.).

• Major urban agriculture programs to help poor in cities grow their own food and/or derive income.

Cuba's urban farming program a stunning success

The Associated Press, June 8, 2008

An additional 15 billion a year for the current federal anti-hunger programs could eliminate hunger in the U.S.

QuickTime™ and a decompressor

are needed to see this picture.

Monthly Review, May 2008

fmagdoff@uvm.edu