Will the Free Market End Hunger? Food First Text extracted from

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Will the Free Market End
Hunger?
Food First
Text extracted from
World Hunger 12 Myths
by Lappe, Collins, and Rosset, 1998
Free Market
• Free Market responds to
money not people
• As poor get poorer and are
pushed from land
– they have even less impact
on markets
• Their needs for food do
not register
• The market responds to
the needs of the wealthy
– to produce luxury goods
http://www.havingaballdresshire.co.uk/toolkit/luxury-dress-rental.jpg
The Market
• Is blind to social and
environmental costs
• Example: U.S. Ag export boom
– Loss of small farmers, rural
communities
– Soil erosion
– Aquifer depletion
– Ground water contamination
– Fossil Fuel waste, global
warming
http://www.klaassenrealty.com/images/auctions/auction_today_sign.jpg
Concentration of Wealth
• The Market leads to a
concentration of
economic power
• Those with greater
economic power
gobble up those with
less
• Food flows from the
hungry to the well fed
http://www.geocities.com/srivathsajoshi/burgerking01.jpg
Inequity
Reward for Hard Work?
• Theory:
– Market rewards hard work
• Reality:
– Market requires hard work and
production
– Market rewards those who have
wealth
– Wealthy can withstand market swings
– Wealthy have better access to credit
• better risk
Donald Trump
http://tv.popcrunch.com/wp-content/uploads/2007/11/donald-trump.jpg
– Wealthy can invest in more land to
offset low grain prices
Distribution of Purchasing Power
•
“The more widely
dispersed purchasing
power is,
• the more the market will
respond to actual human
preferences and needs
• and the more power the
market will have to end
hunger”
– Food First
Mexico
http://z.about.com/d/studenttravel/1/7/X/E/zihua_secret_merc_green_bowl_03.jpg
Structural Adjustment Loans
• Loans given in 1980s-90s
– International Monetary Fund (IMF)
– World Bank
• Condition of loans = Structural
Adjustment Rules
– imposed on governments
• Goal: make developing countries
– Efficient
– competitive
IMF loans
http://jeffboulton.ca/BBB%204M1%20Map%20-%20IMF%20Use%20of%20Credit.gif
• Involved
– deregulation,
– privatization of state institutions
– removal of trade barriers
Effect of Structural Adjustment
• Benefits of institutions and
resources transferred from
public to private business
• Gap between rich and poor
widened as economic power
concentrated
• Poverty and hunger escalated
• Free market increased import
of luxury goods
• Cheap imported grain drove
local farmers out of business
http://ecx.images-amazon.com/images/I/41I1C0Lo5TL._SL500_PIsitbdp-500-arrow,TopRight,45,-64_OU01_AA240_.jpg
http://www.antiwarcommittee.org/imag
Costa Rica
• After a decade of
Structural Adjustment:
– Trade deficit rose 100%
– 76,800 cars entered
country in 3 years
– 42,000 farmers growing
corn, beans and rice
staples went out of
business
Costa Rica Market
http://images.goabroad.com/images/listingphotos/standard/Costa%20Rica%20-%20Fruit%20Stand.jpg
Need Government and Market
• Government and Market must
work together to end hunger
• Market by itself will lead to
concentration of wealth
– and increased hunger
• Government by itself without
market leads to
– inefficiency,
– lack of motivation
– low production
• Example: Soviet Russia
http://www.flykending.dk/tema/museer/nasm/capitol1.JPG
Role for Government
• Government policies can
help to spread the wealth
and means of wealth
– so that the market can serve
more people
• Government can help
insure that people have the
means to support
themselves
– and thus eat
http://www.goldenbuckeye.com/connection/nov2007/2.gif
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