How sad the rain sounds
On the cardboard roofs
How sad that my people live
In cardboard houses
Children the color of earth
With their same scars
Millions of tapeworms
And that's why
The children live sadly
In cardboard houses
The worker is coming down
Almost dragging his feet
How happy it is that dogs live i
From the weight of suffering
The exploiter’s house
Look how much he suffers
You are not going to believe it
Look how much the suffering weighs
But there are schools for dogs
Where they train them
Not to bite the newspapers
But the Boss!
For many, many years
He’s been biting the worker
The World Food Crisis
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Fred Magdoff
fmagdoff@uvm.edu
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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.
A Broad Overview
Total world population = 6 billion people
In cities = 3 billion people
In rural areas = 3 billion people
The Wretched of the Earth
•
•
•
•
•
•
•
3 billion live on less than $2 per day
1 billion live on less than $1 per day
1 billion live in slums
25 million per year migrate to cities
1 billion have no access to clean water
2 billion have no electricity
2.5 billion have no sanitation systems
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 Staff
August 27, 2008
Far 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.
• 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
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.
Why are people hungry?
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.
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.
Food is no different than any other
commodity—
Automobiles
Jewelry
Clothing
Books, etc., etc.
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
Percent of
net worth
Top 1%
33.4
Top 5%
59.2
Top 10%
71.5
Top 20%
84.4
Bottom 80%
15.5
Bottom 40%
0.3
Richest 400 Americans have a net worth of $1.6 trillion
More than the wealth of the bottom 150 million people
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Bangladeshi
demonstrators protest
over high food prices and
low wages
The Current Crisis
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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.
Food Inflation, Riots Spark Worries
for World Leaders
— Wall Street Journal, April 14, 2008
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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.
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
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).
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
years.)
consumption has more than doubled in last 50
• 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.
Governmental Responses
• Emergency imports
• Eliminating import duties
• Freezing exports of foods
• More food subsidies
etc.
Governmental Responses
Bush Orders $200 Million in Food Aid
By Associated Press
4:31 PM EDT, April 14, 2008
(A congressional analysis shows the Iraq war
costing taxpayers almost $2 billion a week.)
Food crisis billions failing to arrive,
warn reports
guardian.co.uk, Oct. 16, 2008
Two Ugandan women drag sacks of food relief
Business Responses
• Rapid increase in land prices in US and
abroad
• Increased deforestation in Amazon
• Corporations and private capital
purchasing land abroad (Brazil,
Uruguay, Argentina, etc.)
• Large profit possibilities
Profit increase for some of the world’s largest fertilizer corporations
Company
Profits 2007 (US$ 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 Larges t 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 crisis
The long-term crisis
The “Washington Consensus”
(The “Neoliberal” Approach) of the
IMF, World Bank, and aid agencies
—one size fits all—
• 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).
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)
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 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
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.
The Future?
• 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?
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?
How can poor nations keep the large
mass of people in rural areas
productively employed in agriculture?
One of the great moral, economic, and
political issues of the 21st century.
• 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 antihunger programs could eliminate hunger in the U.S.
Monthly Review, May 2008
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fmagdoff@uvm.edu