World Food Crisis a Sign of Bad Policy, Not Demographic Doom
WASHINGTON, JULY 3, 2008--Bad government policy is contributing to the global food crisis, speakers said at an AEI conference on July 2. In the past year, international grain prices have risen significantly, leading to food riots and prompting some policymakers and scholars to question whether the era of cheap food is ending. Among proposals to solve the crisis, Senator Richard Lugar (R-Ind.) urged Congress to lift the 54¢-per-gallon tariff on imported Brazilian sugarcane ethanol, which (unlike corn ethanol) does not divert staple crops away from food markets. World Bank president Robert Zoellick called on governments not to close off international food markets by stockpiling.
In addition to his call for lifting the tariff, which would put pressure on domestic ethanol producers and is opposed by congressmen from ethanol-producing states, Senator Lugar called attention to global food insecurity, noting that more than a dozen countries have recently experienced food riots, twenty-three have significant undernourished populations, and 170 million children are malnourished. He attributed the food crisis to a combination of growing populations and economies, rising demand for biofuels, rising energy prices, and environmental factors. He offered a number of policy proposals that would enable world food output to match demand, including strengthening food aid, investing in agriculture in developing countries, and phasing out European and American agricultural subsidies.
As the price of food has gone up, so has the price of food aid. Zoellick called attention to the World Bank's immediate need for $10 billion. In response to increasing cereal prices, he said, we're "starting to see breakdowns in international food markets" as governments restrict imports and exports. The United States and Europe continue to subsidize agriculture and allow quotas, hurting the competitiveness of farmers in the developing world.
One central question at the event, which was organized by AEI's Mauro De Lorenzo, was whether rising food prices and resulting crises are an inevitable Malthusian effect of rising populations. The answer? A resounding "no." The causes of current food shortages, conference participants said, are political and economic. Long-term food insecurity in the developing world requires changes to development policy.
Conference participants debated the effects of the food crisis, with some saying that rising food prices have plunged millions of people into poverty and food insecurity and others arguing that the world's poorest are largely independent of global markets. Asma Lateef of the Bread for the World Institute said that increasing food prices have a "devastating toll" on the poor, leading to foregone meals, less-nutritious food, and panic and social unrest.
Wellesley College's Robert Paarlberg argued against this narrative and the idea that high international food prices are a proxy for hunger. In fact, he said, "hunger in the developing world usually results from highly localized" factors, particularly farm productivity, and that higher food prices internationally to not necessarily lead to lower consumption for food-poor people. He described lagging African productivity as "the real food crisis."
The effect of low agricultural productivity in the developing world, particularly in Africa, was a major theme of the conference. According to Namanga Ngongi, president of the Alliance for a Green Revolution in Africa, "Africa has been in a food crisis for about thirty years." Output for the average African farmer is low: with increased investment, including improved seeds, access to fertilizer, crop rotation, planting legumes to combat soil depletion, and better infrastructure, Ngongi said that we can, at the very least, delay Malthus's conclusions about the inevitability of food shortages for another few centuries.
AEI's Nicholas Eberstadt put the current issues in a larger historical context. Since 1900, international cereal prices have significantly decreased. During the last century, there have been massive increases in GDP and explosions in human capital and life expectancy. Progress in sub-Saharan Africa, however, has been slower.
Participants agreed that agriculture in developing countries receives too little investment and that aid could be structured more efficiently. Former U.S. Agency for International Development administrator Peter McPherson discussed how most food aid from the U.S. government is U.S.-grown and delivered on American ships--as a subsidy to American companies--instead of being supplied locally. Consultant Suzanne Hunt spoke of the need to reduce oil dependency in developing countries and of the potential for biofuels--beyond corn--to meet energy needs.
The speakers concluded that the problems in global food systems have more to do with politics than with Malthus's predictions of demographic doom. Conventional agriculture has made massive gains in the past one hundred years and continues to operate ever more efficiently and with a smaller environmental footprint. However, agriculture is underinvested in by development agencies, and much of the developing world does not have the means to increase productivity and standards of living. As Senator Lugar concluded, "Malthus is clearly wrong. . . . We'll need to produce more, and we have the scientific ability to do that. The question is--do we have the political will?"
--ABIGAIL HADDAD
For video, audio, and more information about this event, visit www.aei.org/event1751/.
AEI has sponsored other research into agricultural, development, and demographic issues:
For media inquiries, contact Veronique Rodman at 202.862.4870 or vrodman@aei.org.
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