Friday, April 18, 2008

Hunger compilation - and ACTION


I'm heartened by the general response to my anger.  But it's not like there are millions of us.  Yet.  There need to be millions.  If you don't already know why I'm FURIOUS, read this.  (It's short.)

Today I'm going to treat you to a compilation of internet news articles on the current effects of hunger and associated poverty.  It will be painful to read- but it will give you ammunition.

From CNN: Food aid to Darfur has been cut.   "Ahead of the rainy season, which lasts from May into September, WFP trucks should be delivering 1,800 metric tons (1,984 short tons) of food to warehouses in Darfur, WFP said. However, deliveries have dropped to fewer than 900 metric tons (992 short tons) per day, it said.

Since January, 60 WFP-contracted trucks have been hijacked in Darfur, the agency said. More than half -- 39 -- are still missing, and 26 drivers are unaccounted for. One driver was killed in Darfur last month, WFP said."
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From the Washington Post: US financial debacle hits Mexico:  "the downturn in the U.S. economy has cascaded into Mexico, causing a sudden, precipitous drop in the flow of money sent home by Mexican immigrants"

"Economists here believe the decline in remittances is already pushing thousands into extreme poverty and could lead to a significant increase in migration as desperate Mexicans, deprived of support from abroad, flee to an ever more difficult U.S. job market."

"Hernández, 80, doesn't take his diabetes medicine anymore. It costs too much, and he'd rather buy food than pills. Ever since his son, Alfonso, lost his home in the United States to foreclosure a few months ago and stopped sending money for medicine and farm supplies, life has been "a disaster, a total disaster," Hernández said."

"The sons of at least three of Hernández's elderly neighbors have also lost their homes, their jobs or both, he said. The river of money from the United States that sustained this village is now drier than the desert that surrounds it."
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From The New York Times: Hunger Brings Anger:   Just read this whole article; it's not that long.  "Saint Louis Meriska’s children ate two spoonfuls of rice apiece as their only meal recently and then went without any food the following day. His eyes downcast, his own stomach empty, the unemployed father said forlornly, “They look at me and say, ‘Papa, I’m hungry,’ and I have to look away. It’s humiliating and it makes you angry.”

That anger is palpable across the globe. The food crisis is not only being felt among the poor but is also eroding the gains of the working and middle classes, sowing volatile levels of discontent and putting new pressures on fragile governments."

"Last month in Senegal, one of Africa’s oldest and most stable democracies, police in riot gear beat and used tear gas against people protesting high food prices and later raided a television station that broadcast images of the event. Many Senegalese have expressed anger at President Abdoulaye Wade for spending lavishly on roads and five-star hotels for an Islamic summit meeting last month while many people are unable to afford rice or fish."

"Down Cairo’s Hafziyah Street, peddlers selling food from behind wood carts bark out their prices. But few customers can afford their fish or chicken, which bake in the hot sun. Food prices have doubled in two months."

"In Haiti, where three-quarters of the population earns less than $2 a day and one in five children is chronically malnourished, the one business booming amid all the gloom is the selling of patties made of mud, oil and sugar, typically consumed only by the most destitute.

“It’s salty and it has butter and you don’t know you’re eating dirt,” said Olwich Louis Jeune, 24, who has taken to eating them more often in recent months. “It makes your stomach quiet down.” 

"In the sprawling slum of Haiti’s Cité Soleil, Placide Simone, 29, offered one of her five offspring to a stranger. “Take one,” she said, cradling a listless baby and motioning toward four rail-thin toddlers, none of whom had eaten that day. “You pick. Just feed them.” "

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A critically important bit of that NYT article is here:  " the spike in commodity prices — the biggest since the Nixon administration — has pitted the globe’s poorer south against the relatively wealthy north, adding to demands for reform of rich nations’ farm and environmental policies. But experts say there are few quick fixes to a crisis tied to so many factors, from strong demand for food from emerging economies like China’s to rising oil prices to the diversion of food resources to make biofuels.

There are no scripts on how to handle the crisis, either. In Asia, governments are putting in place measures to limit hoarding of rice after some shoppers panicked at price increases and bought up everything they could."

Notice?  THERE IS NO MENTION OF FOOD SPECULATION AS A CAUSE- OR STOPPING IT AS A REMEDY.

We need to get speculation into the public eye and mind- and get it talked about.  That's step one.

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Also from the New York Times- Business Section...:  World Rice Shortage/Australian Drought:  
"The Deniliquin mill, the largest rice mill in the Southern Hemisphere, once processed enough grain to meet the needs of 20 million people around the world. But six long years of drought have taken a toll, reducing Australia’s rice crop by 98 percent and leading to the mothballing of the mill last December."

"The collapse of Australia’s rice production is one of several factors contributing to a doubling of rice prices in the last three months — increases that have led the world’s largest exporters to restrict exports severely, spurred panicked hoarding in Hong Kong and the Philippines, and set off violent protests in countries including Cameroon, Egypt, Ethiopia, Haiti, Indonesia, Italy, Ivory Coast, Mauritania, the Philippines, Thailand, Uzbekistan and Yemen."

"Drought has already spurred significant changes in Australia’s agricultural heartland. Some farmers are abandoning rice, which requires large amounts of water, to plant less water-intensive crops like wheat or, especially here in southeastern Australia, wine grapes. Other rice farmers have sold fields or water rights, usually to grape growers."

"Scientists expect the problem to worsen. The Intergovernmental Panel on Climate Change, set up by the United Nations, predicted last year that even slight warming would lower agricultural output in the tropics and subtropics."

"Australia’s total rice capacity has declined by about a third because many farmers have permanently sold water rights, mostly for grape production. And production last year was far lower because of a severe shortage of water; rice farmers received one-eighth of the water they are usually promised by the government."
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Also from The New York Times- Business section: Organic Food Too Pricey?:  "people who have to buy organic grain, from bakers and pasta makers to chicken and dairy farmers, say they are struggling to maintain profit margins, even though shoppers are paying more. The price of organic animal feed is so high that some dairy farmers have abandoned organic farming methods"

"Perry Abbenante, global grocery coordinator for Whole Foods Market, said sales were strong and customer counts were up. He said it might be too soon to know how consumers would react to higher organic prices, particularly in dairy.  “Man, $6.99 for a gallon of milk is pushing it,” he said. “We have to be very careful about not pricing organics out of the market.”  "

"prices for conventional corn, soybeans and wheat are at or near records, so there is less incentive for farmers to switch to organic crops; making the switch requires a three-year transition and piles of paperwork."

"Bob Eberly, president of Eberly Poultry in Stevens, Pa. The cost of raising poultry has increased 16 percent in the last six months, but he said his prices had increased only 7 percent."
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Ok.  Gonna quit with the terrifying quotes here, before (hopefully before!!) I drive any readers into horrified catatonia.   That's NOT the idea.

One point about the business aspects of organic- eventually, the rising costs of fuel SHOULD make the competitive aspects of organic/non-organic tip in favor of ORGANIC.  Commercial fertilizer is made mostly from natural gas.  Then shipped - it's heavy, and takes a lot of diesel to move.  And spread.  Most organic farmers use only on-farm inputs; manure or green manure.  That's going to turn out to be a HUGE benefit, very soon.  Likewise- pesticides- can only get much more expensive.

This is already happening- acres planted to corn in the US will be DOWN 8% from last year.  Multiple causes- one of them being- the very high cost of fertilizer, which corn uses like a drunk on his last binge goes through Sterno.

My own guess about the organic industry is- it's going to be painful for a while- but reality will eventually kick in, and the day may well come when organic food is CHEAPER than "conventional".  Assuming the arctic methane doesn't get us first.  :-)

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So.  For the first time, I'm going to ask the readers of this blog to DO something.  For us all.  

Many of the causes of the world food crisis are beyond our immediate reach; we can't fix global warming this morning.

But one cause is NOT beyond reach.  It's HUGE- and virtually UNRECOGNIZED.  

It's Food "Investment" - otherwise known as- SPECULATION.

Blog reader DC sent in a comment with this link; International Herald Tribune.  Even some insiders know it.

The politically engaged population of the US - and the WORLD - does not know it's there; and do not know that potentially- it could be OUTLAWED.  Next week.

It could.  Life-critical resources have always been protected from speculation (theoretically!) - it's an absolute obscenity to sell water to people dying of thirst- the whole species feels that way.

That's the anger we need to stir; and this post has been written as an introduction to the situation.

The starving countries SHOULD start the push- if we can alert the Philippines that half of the price of rice goes into the pockets of slimy weasel food profiteers- they can start screaming to the world- the UN, the World Court, the World Trade Association - that this MUST STOP.

The Philippines - Malaysia - Thailand - could actually pass legislation internally banning food speculation.  And then start boycotting international companies that facilitiate it.  

Of course it won't be easy to write the laws.  Of course the profiteers will scream bloody murder.  But yes, it can be done.

They will pass laws long before the US will.   Europe will pass laws, long before the US will.  But eventually the moral pressure will be huge.

In fact, at the moment, the ultra-rich in this country are just smugly grinning about how cool they are- outsmarting the markets.  Most of them have, pardon my Serbian, "shit eating grins" glued on.  (I think he's saying "yeah, sit on THIS, peon!"  But at least he's wearing his flag pin!)

But they ARE human.  If they continually wake up in the morning and have to read stories about how the rest of the world truly considers them to be lower than pond-scum- they will get depressed.  As people.  And start yielding.  Even pond-scum would LIKE to think they're "good people"- at least most of them; some of the time.

So:  PLEASE DO THIS:

Do you have a blog?  Link to this post.  Write about it.  Spread it to other blogs.  Tell them to read the previous several posts here, too.

In 15 minutes:  Email this post to 10 of your contacts who may think as you do.  Ask them to pass it on.

Email this post to your legislators; if you know some, personally, send it personally, and ask to talk to them about launching legislation.

Do you have friends in hungry countries?  Email them this post- ask them to pass it on.  Get them to put it in the hands of their government.

Get this post to your pastor, rabbi, or imam- ask them to turn it into a sermon- and get your congregation RILED.

Do you have contacts in universities?  Get this post to activist groups on campuses- get them to work on... DEMONSTRATIONS.  There should be THOUSANDS marching down Wall Street, with banners saying-

 "MURDERERS!!"

  - and photos of the starving.  What the hell- have friends in Haiti?  Ask them to FedEx  you a few corpses.  They're cheap and don't weigh much.  Prop them up on the Stock Exchange steps.

Are you a member of a conservation group?  Get them this post.

Pass it on.  Talk about it.  GET ANGRY- just in case you're not.  Send your comments here about what you've done- and ideas of your own.  Let's get it moving.
(so far today a LOT of people have "hit" here; nearly a thousand so far- but only a few have commented.  I KNOW more of us have sent an email or two- please DO send me a comment, just to say- "I posted it: or I emailed it."  A movement needs people!)

Just take 15 minutes, please.

Think this kind of action can't work?  Take a look here- substantive change, happening right now, LONG before the laws change.

more to come.

53 comments:

MissAnna said...

I think you've written a fantastic post and bring up a lot of truly important points. And while I'd like to have a bunch of answers for you, unfortunately I only have a few more questions.

I grew up on a small wheat farm in eastern Washington (state), small being that my father could manage everything pretty much by himself. Wheat prices averaged between $3 (bad year) and $5 (good year) a bushel growing up. Pretty slim profit margin, lot of people weren't making much money.

Ten years later, we've got wheat at $15 a bushel (with diesel etc much higher as well). And people (in the US) are griping about cost of food. No one thought about the small farmer and his family surviving on <$1 a bushel profit 20 years ago. Everyone was happy for cheap bread/meat/milk/eggs that result from cheap wheat/feed. Result was many farmers sold out to large corporations, which in term team up with giants like Monsanto and cause a whole host of other problems.

So I guess my question is (and this is probably more appropriate for an email rather than a blog post as it's so long): How can I not support my family now that they're finally making a bit more money? How can I not be happy that the 12 hour days, 6 (or 7) days a week that my father (and so many others) puts in is finally worth a little more?

I understand that these prices are hurting the economy (I'm only addressing the US right now, not the plethora of other atrocities going on in the world) and that the price of essentials is affecting so many. But where were these people the past 20 years when small farms across America were going under because wheat was $3 a bushel and production costs were $3.25? Everyone else was celebrating with a strong market, high profits, low unemployment and yet these farms were going under because bread was $1 a loaf.

I've gathered from your blog that you're involved in some sort of agriculture and so probably know very well the high cost of diesel/equipment, etc. So I'd really love to know your take on this. Do we keep the small farms and pay more for our food supply? Or do we sell everything to large corporations which can run at lower costs, thus lowering the cost of goods? And what sort of government interference should be allowed? On the one hand, subsidies kept small farmers from going under for many years and kept prices relatively stable. On the other, it’s a system run by a relatively small group holding quite a bit of power and most likely is outdated and not always appropriate.

I’m going to post this as a comment to today’s post however, I know it’s long and veers from your original argument so I understand if you don’t put it through. But these were some of the thoughts I was having while reading your (quite well referenced!) post.

Thanks! Anna

DC said...

Food speculation on futures markets definitely has played a role in the recent food crisis. There is a recent Reuters article that lists it as a contributing factor. High fuel prices, which have made transportation more expensive, rising demand in Asia, the use of farmland and crops for biofuels, and a long drought in Australia are also causes for the shortages.

Behind all of these factors, there is a deeper problem: the industrialized nations of the world have created a food system that is fundamentally unfair to the developing world. There is a good discussion of this topic on Democracy Now!. In a recent interview, food activist Raj Patel explains:

"[T]here’s a political story here, and it’s a longer-term political story about how countries have been forced to abandon their support for farmers and to abandon things like grain supplies and grain stores. And this is a longer-term story, and it involves organizations like the World Bank and the World Trade Organization that have a fairly iron control over the economies of most of the poorest countries in the world. And what the World Bank and what the WTO and, to some extent, the International Monetary Fund have done is force these countries to tie their hands behind their back, effectively, and to bind them very firmly to an international economy in food. And the consequence of that is that when the price of food goes up, these economies have very little recourse and very little possibility of defending themselves economically."

If you listen to the interview and want more background information on how the World Bank, WTO and IMF have screwed over the developing world generally, there's a good article here.

Miss Anna, I am no Greenpa, but fwiw, my vote is to keep small farms and dump the big corporations. You can read my thoughts on this issue (first comment) here.

JenRob said...

Thanks for the wonderful (and horrifying) post. I've reposted in my blog and will be emailing it to my friends.

I have to admit my ignorance, both on this topic and politics in general, and ask you if you know who exactly we should be writing to - our representatives in the state legislature? national legislature? Both? Are there any particular committes we should be writing to?

Sorry for being ignorant, but I'm trying to fix it.

Greenpa said...

Anna- not a problem, the length and comments are fine.

And you have a good point, I DID fail to delineate who the villains are- and are NOT.

The farmers, as usual, are NOT the villains, and the extra dollars going into their pockets right now are desperately needed by them. Most of the farmers right in my own area are mortgaged in the area of 0.5- $2 million, from years of losses. Me, too.

So, for sure, we want to be certain people don't start screaming at the ones who grow the food. It's the huge corporations- and the "investors" - who jack up the prices.

Earl Butz- Nixon's Sec. of Ag. and not my favorite person- had a schtick he would use at lectures, which is still true. He'd put a loaf of bread on the podium- and start peeling off slices. "This slice goes to..." storage costs? shipping? processing? ADVERTISING - usually 4 or 5 slices- etc.

Then he'd get to the end. All that is left is the heel. He'd hold that up, and say- "This is what goes to the farmer. And it's the heel." Mostly true.

The farmers should be JUST as furious that their hard work is being stolen- and fat cats getting rich doing NOTHING but store it until it gets more expensive. Farmers should join the protests.

Big versus small? Small. Big corporate farms are run for profit- and soil can go down the creek, for all they care. Long proven. Even efficiency wise- small farmers on their own land are much more productive than huge machines- that can't even drive into the corners on the kinds of fields we have around here. Big corporations think only of next quarter's report. The farmer thinks about the grandchildren.

The idea that small is more expensive is actually a fallacy spread by "the big boys" - it doesn't include the cost of land abandonment due to erosion or salinization or desertification. Doesn't include the cost of families put out of work and onto welfare.

The truth is, when you're looking at a $3 loaf of conventional bread, and a $3.50 loaf of organic- the organic loaf IS CHEAPER. For your grandchildren. But it's a REAL REAL cost. Either we pay it now; or our grandchildren will have to.

I wonder if we could get the organic stores to add that to their signs? It's real- and even calculable, I think, though I don't think it's been done.

Brian M. said...

Greenpa, I am an agricultural speculator. I bought a share in my local CSA from Good Life farms, where my farmer is Darren. That entitles me to a share of his produce, even though he hasn't grown it. It is a futures contract. I do it because I am trying to support local agriculture, but it is legally speculation.

Why do the speculation markets exist? Because the farmers need them. Farm output is variable and often has tiny margins. The farmers often need to lock in a price or at least spread the risk. That risk then becomes speculation.

What will happen if we outlaw speculation? Well all the CSAs shut down first of all in the first world. But what about elsewhere? Well without a futures market, the year to year variability will get worse for farmers, and they will need bigger pocketbooks to survive. Well capitalized farmers, that is BIG RICH farmers, will be able to survive lean years and thrive in good years, where the samll farmers will not. That's why coffee farms kept turning into coffee plantations. Outlawing futures markets will benefit the biggies but kill the smallies. (Oh and agrarian organic can become more competitive as fertilizer costs go up, but industrial organic, like most the stuff sold at Whole Foods, is in a very similar boat to industrial non-organic, and I thought they bought external organic fertilizers all the time these days.)

But allowing futures also allows speculators. I know you are angry, and I know that rich speculators are a great target. I wish there was a way to prevent the hot money from distorting things, without destroying the ability of farmers to protect themselves via futures contracts. But anger isn't going to produce that nuanced of a result, it will shut down futures, and only the biggies with deep pockets will survive it. If I'm misunderstanding then correct me, but it seems to me that shutting down all food speculation will do more harm than good, unless you can radically alter our food-growing system FIRST.

The problem is rationing food by price, and that we have screwed our agricultural system up so badly that it is expensive to grow food via it, and that we have pretended for too long that food is far cheaper than it really is.

Greenpa said...

Jenrob- this is a problem for the Federal government; so both your Senators, and your Congressperson. I'm not sure about committees- but your congress peoples staff should know, right quick.

:-)

equa yona(Big Bear) said...

Your posts on the subject of commodites trading has stimulated a LOT of questions and I'm having a hard time finding the answers. I read the articles you referenced and I certainly agree that the profits made and the growing rich/poor gulf is evil. Let's redo that, EVIL!!!
The questions begin with, what the hell are they actually doing? I went to Wikipedia and frankly I find that the whole subject is so specialized and complex that I am not understanding much. It is certainly not as if these traders are literally locking food up until prices rise. They are buying shares as a gamble that the prices will rise-if they do, they profit. Drought is causing a shortfall in Australian rice. Demand doesn't decrease, supply does thereby driving up the price. The speculator hasn't caused the price to rise, merely profitedfrom it. Isn't that the basis of capitalism? Are you saying that the food staples should become publicly i.e. government owned,, like water is in many places? Mind you, I am not at all opposed to this, just trying to figure out what exactly the goal is here.

JenRob said...

About brian m's comment - If we don't want to outlaw CSAs, but do want to get rid of speculators, wouldn't it be possible to put a cap on the amount of money spent per person which would allow CSAs but prevent speculators from buying large amounts of food and holding it hostage?

Greenpa said...

Brian M- I'm familiar with the arguments you make, that the futures markets are necessary for the stability of the system. I do NOT buy it.

Those are the arguments they used to set up the speculation markets in the first place.

And they're the SAME arguments used by all the grand financiers to set up the totally incomprehensible re-selling and re-re-selling of mortgages, internationally. "We're spreading the RISK, so that collapse is now truly impossible!"

Happy Titanic thinking.

It's a big fat lie.

There are OTHER ways risks could be spread. Golly, gee- lets' get biblical. Joseph? Egypt? Grain stores?

Why in hell doesn't the federal government manage a national strategic grain reserves program, and specifically manage it to level out the field?

Well, because then the speculators would have to go out of business. ONLY REASON.

We really have to get over this concept that unregulated business is good for the world. IT NEVER HAS BEEN- it's only good for the unregulated thieves. But they keep telling us- "just wait, you'll benefit soon..." and we keep buying it.

DC said...

Equa yona and others who may be interested: There is a good article here that explains how food speculators drive up food prices. Here is an excerpt:

"Futures purchases of agricultural commodities classically have been the means by which a limited number of traders stabilized future commodity prices and enabled farmers to finance themselves through future sales.

Speculative purchases have no other purpose than to make money for the speculators, who hold their contracts to drive up current prices with the intention not of selling the commodities on the real future market, but of unloading their holdings onto an artificially inflated market, at the expense of the ultimate consumer. Even the general public can now play the speculative game; most banks offer investment funds specializing in metals, oil and, more recently, food products.

It is astonishing in the present situation that the international financial institutions and government regulators have done little to control or banish this parasitical and antisocial practice. The myth of the benevolent and ultimately impartial market prevails against all contrary evidence.
"

Megan said...

I don't know much about speculation, but I think that it would make more sense to speculate on the food that's left over AFTER EVERYONE IS FED.

I have written to my congresswoman, Patty Murray of Washington state and directed her to this blog post. I'm sure I'll get a nice form letter in return, but if any of them could light a fire, it's Patty.

Greenpa, you're an inspiration. Keep at that iceberg. It might not be moving much, but we can see it better the more you point at it. :)

Bham Meg

goritsas said...

Yo, greenpa, right on, brian m is totally misguided. No, actually, he's delusional. He’s even missed the entire point, clearly. It’s not a futures contract but the far more familiar dividend that all shareholders expect. Only the green really is green. brian m. is not by any measure speculating, he’s investing. He’s purchased a share that he can rightfully expect something from. He can expect “income” or he can expect “capital appreciation” or, if he’s really lucky, he can expect both. For a CSA it seems clear the investor is not participating in the “capital appreciation” part of investing, in much the same way that bondholders and preferred shareholders do not generally participate in the “capital appreciation” side of things. On the upside, of course, he gets a regular dividend for his investment. And like all dividends, this is driven by results. In the case of his CSA this will be whatever winds up in the box on his doorstep. And like all dividends, the value of the dividend may vary. But, in truth, he’s not speculating, he’s investing for dividend income. Income that in this case he can eat, even if he’s too damned stupid to recognise the difference.

There could be a bit of additional distinction here. Perhaps brian m. isn’t actually investing but has rather taken out a subscription. I mention this only because in some sense the box that lands on the doorstep is something akin to the magazine that gets delivered in the post. The magazine is the box and the content of the box is much like the content of a magazine; you never know what you’re gunna get in advance but it always runs to 200 pages regardless of what’s in the table of contents.

So, in the end, whatever efforts brian m. makes to construe participation in a CSA as speculating, he’s just too damned dumb to realise just how too damn stupid he really is. The rest of his pointless mouthing simply reinforces an ignorance that just seems too completely wilful to be excused as the youthful exuberance of being damn stupid.

Greenpa said...

DC #2 - MANY thanks for that link, it's outstanding; I put it up in the body of the post. Equa Yona, it does the best job I've seen of making it comprehensible. It's no surprise to me that what you were finding in Wikipedia was hard to comprehend- that's part of the GAME these guys are playing- "this is too complex for you little people to understand; just take our word for it!" Just like they did in the mortgage/housing bubble disaster. That crap was so convoluted even the Wall Streeters said they couldn't understand it.

The numbers there tell it- the number of people buying "contracts" is WAY up- right along with the prices.

I don't think the government has to own all the resources- just maybe manage the biggest single reserve, so they can throw their weight around, and make sure no one is just driving prices up.

Managing the government managers is another problem, of course- we know that's a mess. Still- better than what we've got.

jewishfarmer said...

First of all, while I disagree with Brian, I don't think there's any place for the name calling in the previous post on this blog - I find it really offensive. It doesn't reflect well on the poster, either.

Regulation of profiteering has a long, long history in the US, and I personally see a major problem with a campaign against profiteering in a time of crisis - I don't think that the consequence Brian envisions are logical ends of such a limitation.

And I do think that the word "Profiteering" is both more accurate and more effective than "speculation."

Sharon

Greenpa said...

Sharon- I agree, it's quite offensive. I hesitated a long time before putting it up- but, a) Brian is quite a big boy, and is not too likely to take it really personally (I hope), b) before goritsas got obnoxious, he was making some ok points, and c) the deciding factor for me- I thought it would actually be useful for everyone to recognize, early on, that this is a fiercely emotional topic- and it will raise huge passions.

And, having grown up in the Navy, I'm also familiar with some perfectly good people for whom normal everyday conversation includes 40% unprintable words. Doesn't mean anything to them- it's just their language.

I don't know why, but I haven't figured out how to edit comments- can I? I've tried several things, and so far can't do it without exporting text outside blogger. If I could, I would have deleted the expletives, and name calling.

Jase said...

Why don't you address the fact that a good portion of the food aid that is sent to the third world and starving countries is wasted there? Street merchants charge unaffordable prices and thus their food rots in the sun. Corrupt governments prevent food from reaching the people, no matter how much money and material aid is sent, and then strike against third party aid organizations attempting to bypass them. Bands of rebels hijack food shipments, kill and kidnap drivers, destroy trucks, and prevent food from reaching the hungry.

If the pipes in one section of a building are tangled, corroded, clogged up and smashed to pieces, then yes, the people there won't get any water. But no matter how much water you conserve and reroute from the rest of the building, they still won't have any water there.

And Brian is completely right about speculation - if speculation and futures didn't exist, then the only people who would be able to farm would be those who had the massive reserves of pre-existing capital to weather bad harvests and natural disasters. One drought and my local CSA is out of business if I don't buy ahead.

Moreover, why is all of this rage of yours only coming out now? True, there are now food riots on the news and whatnot, but millions have been starving and dying of disease for hundreds of years, to say nothing of internecine conflicts and refugee crises. Is it because they're now being covered on CNN that you care so much more? Or is profiting from a system that indirectly results in tens of millions of eventual deaths really so much more abhorrent than when you're only talking about millions of eventual deaths?

equa yona(Big Bear) said...

AHA! That article from the Herald Tribune was indeed clarifying. So what we are going after first is the speculation, not futures trading. And the bastards DO lock up the food! GRRRRRRRRRRRRR.
So first goal is regulation(preferably outlawing) of the hedge fund speculators, yes? One thing I did learn from the Wikipedia article is that this whole shady practice was invented in 1949 precisely to get around the regulations on more legitimate capital ventures.
Ok, I will post some of this for all two of my blog readers and write the senators, representative and friends today. Thanks Greenpa and dc and all. Shows to go we are never to old to learn a big something about how we are getting screwed.
And jeez Goritska, lighten up with the name calling.

Mrs Green said...

Hello Greenpa,

I am honoured to have found your blog this evening. What a wonderful, thought-provoking, passionate and articulate post you wrote - thank you so much for sharing this with us all.

I have an anger building inside me too; sometimes I feel ashamed to be a human in the so called 'developed' world when I see how we treat other people.

For me, I'm struggling to comprehend how we can allow people to starve in order that we can take all their crops to fuel our cars and aeroplanes. And that is only the tip of the iceberg.

Please don't give up on trying to change things in the world - you are a true inspiration; someone who is actually walking the walk. There are not many of you around :)

In our history as a race we have achieved great things, and if we can reach a critical mass, we can achieve great things once again.

I've just added you to my links section because I want other people to come here, sit at your feet for a while, as it were, and amass some of your wisdom.....

Love and light,
Mrs Green

DC said...

If anyone is interested in a model letter they can use to send to their representatives, feel free to take anything/all from mine (below) that you find useful. I know that there are people who will strongly disagree with me about these issues, and that's fine. This information is for people who share my concerns and perspective. You can find out who your representatives are by entering your zip code in the box in the upper left hand corner here.

Dear Senator/Representative [name]:

I am writing to you today to express my concern about the recent food crisis faced by people in Haiti and many other parts of the developing world. The World Bank estimates world food prices have risen 80 percent over the last three years and that at least thirty-three countries face social unrest as a result. UN Secretary-General Ban Ki-moon has warned the growing global food crisis has reached emergency proportions. The Food and Agriculture Organization, a branch of the UN, has identified 36 “crisis” countries. The World Food Program (WFP), another UN agency, estimates that it will need $500 million on top of what donor nations have already pledged to fill what the WFP calls the global “food gap.”

Several factors are responsible for this crisis, including high fuel prices (which have made transportation more expensive), rising demand in Asia, the use of farmland and crops for biofuels, a long drought in Australia and food speculation on the futures markets. Furthermore, policies of the World Bank, the World Trade Organization (WTO) and the International Monetary Fund (IMF) have exacerbated the problem. They have effectively tied the hands of developing nations behind their backs, binding them very firmly to an international food economy. Consequently, when the price of agricultural commodities goes up on world markets, these nations have extremely few options to deal with resulting food crises.

I would like to ask you and other members of Congress to take the following steps to address the food crisis:

1. Appropriate the $500 million needed to fill the immediate “food gap.”

2. Stop subsidizing the production of corn ethanol and other food-based biofuels. Not only does growing corn and soybeans to produce ethanol and biodiesel contribute to world hunger, but it is an extremely inefficient way to make biofuels. Developing the technology to use algae and cellulose to produce biofuels would be a much better use of taxpayer dollars. While each acre of corn produces around 300 gallons of ethanol a year and an acre of soybeans around 60 gallons of biodiesel, each acre of algae theoretically can churn out more than 5,000 gallons of biofuel each year. Enough algae-derived biodiesel to replace all petroleum transportation fuels used in the U.S. could be grown in 15,000 square miles, or roughly 12.5 percent of the area of the Sonora desert. This production method would not require the use of farmland or threaten food crops. Cellulosic ethanol production, though it faces larger technology hurdles than algae-based fuel production, also holds great promise.

3. Take steps to end food speculation on the futures markets. Speculative purchases have no other purpose than to make money for the speculators, who hold their contracts to drive up current prices with the intention not of selling the commodities on the real future market, but of unloading their holdings onto an artificially inflated market, at the expense of the ultimate consumer. It is astonishing in the present crisis situation that the CFTC and other government regulators have done little to control or banish this parasitical and antisocial practice. Speculative trading of food commodities should be banned at once, and rules that promote only legitimate trading that benefits farmers and consumers should be established.

4. Take steps to reform the World Bank, WTO and IMF. These institutions have created destructive polices that have increased poverty and hunger in the developing world. As first steps to reforming them, all debts of impoverished countries to the IMF should be cancelled, and the IMF’s imposition of structural adjustment policies (SAPs) on these nations should end. SAPs have required poor nations to reduce spending on health, education and development, and to make debt repayment and other activities that benefit wealthy industrialized nations a priority. The World Bank, WTO and IMF have have forced poor countries to abandon their support for farmers and to abandon things like grain supplies and grain stores that would prevent hunger starvation in times of crisis. Immediate reforms are necessary to put an end to this situation.

I appreciate your immediate consideration of these issues.

Sincerely,

[name]

goritsas said...

jewishfarmer,

First off, let’s be really clear here. Speculation is always characterised by the use of leverage. So, no matter what else one might say about participating in a CSA one thing it’s not by any measure is speculation. Is somebody attempting to portray their participation in a CSA as speculation being stupid? Yes, in my book they are. CSAs are not leveraged nor are they fungible nor do they have clearly defined locations of delivery nor do they have an openly traded market traditionally operated by open outcry. End of that sermon. But don’t miss the point. The metaphor was worth a D-minus from even the most lenient of professors.

If you feel it doesn’t reflect well on me, then I’m happy to ignore your opinion. As for confusing profiteering with speculation, well that just doesn’t wash either. It is entirely possible to profiteer without having to speculate. Unfortunately, speculation is the grease that lubricates the futures and their derivatives market place, not profiteering. Let’s make no mistake, speculators are in it to profit but not all speculators are profiteers, at least in the narrowly defined sense the financial marketplace chooses to use. You are wrong to want to substitute speculation with profiteering. There are not now, nor have they ever been, the same thing.

As for regulating “profiteering,” that’s just what the U.S. government tried back in the 70’s with the oil companies. You may even remember it, the so called wind fall profits tax. Look how well that went. You’re completely wrong if you think government regulation controlling profiteering will make things better. Such regulation has never done so and never will.

Brian M. said...

Not terribly offended, and I guess I wasn't clear enough in my post. Let's try again. A well-crafted rule might well allow good forms of financing that actually help small farmers while disallowing greedy speculators. That isn't impossible, it just requires well-crafted policy, rather than blanket policy. And YES there are big boy speculators using the futures markets to screw things up, agreed. And YES government should save grain for rainy days, and interact with the whole ag sector in vastly different ways. But if we start shouting to close down all the speculators at a time when big agribuisness has most of the power, they will not craft nuanced policy, they will use it as a club to shut down their grassroots upstart competitors!

I'm not trying to argue that futures are required for the stability of the system. The big boys can survive without futures (although it cuts their profit margins), they could hold extra reserves to get them through bad years and make it up on good years. Its farmers close to the edge without a deep pocket that won't survive bad years without price lockins that can't use this strategy, and those are mostly the little guys. And you are right the futures don't completely fix the problem, they just help some. Likewise you are right that the mortgage securitization, and insurance and re-insurance and CDS's and what not spread the risk around until the whole damn system is on the verge of collapse.

I'm also not saying unregulated business is good for us. I'm saying that ag policy has been firmly politically captured by the big ag interests, and any new ag legislation or policy that gets by is likely to strongly favor them unless we are very very careful. We can fight the system, but we have to be careful about the order we do it in, so we don't doom our own allies. If we can get our ag system to run on something other than capitalism great! Heck lots of farms run negative already, they are run because the people running them love them not because they make a profit. But we need to make sure farmers other than jsut big ag can survive.

I probably am stupid, delusional and misguided, but I'm calling it like I see it until you help me to see it otherwise. Some investors care more about dividends, and some care more about capital appreciation. Some things look like investments and some like speculations, but there is a spectrum and the dividing line is fuzzy. Hot capital causes all kinds of problems in many markets, but it exists partly because getting rid of it legally usually requires getting rid of other people also that are serving a useful role.

Is my CSA really speculating? Well I couldn't get exactly the same goods any other way, and at least part of my goal is helping out Darren, so fine, my motive is not entirely speculation. But I COULD buy my food week by week in the local farmers market (including many things from the exact same farm), rather than buying them upfront at the begining of the season. When I buy the CSA one of my motivations, is my belief that I'll get more good local food by paying upfront early, than by buying week by week and that is SPECULATION! I'm betting on the growing season and the market. Certainly that is part of how I sell it to others when I try to get them on-board. And in doing so I am helping to stabilize the market for the purposes of the small farmers so that they can better plan. And my market is NOT an unregulated market, I know and like the guy regulating it (Andrew Connor). Markets aren't just vast faceless capitalist affairs, they can also be small local affairs with handshakes and names.

Here I'll quote Wikipedia and you can disagree or call them stupid if you want "A degree of speculation exists in a wide range of financial decisions, from the purchase of a house to a bet on a horse; this is what modern market economists call "ubiquitous speculation." In Security Analysis, Benjamin Graham gave a definition of speculation in relation to investment: "An investment operation is one which, upon thorough analysis, promises safety of principal and a satisfactory return. Operations not meeting these requirements are speculative." - Choosing to buy a CSA rather than just shopping the market week to week, is a speculation where the return might be good or it might not (as is the magazine subscription), (and it sure isn't an investment because I don't retain a principle at all, unlike my cowshare which is technically an investment, albeit a partially speculative one).

Too much of the wrong kinds of speculation are hurting the agriculture market, I agree. But some of the right kind of speculation has long been central to helping farmers plan for the future, cope with risks, and stay afloat, and that it true of little farmers moreso than big farmers. Even DC's article admits that "classically" futures purchases have been used to stabilize the markets and help farmer's finance. It has done good, even though it has been used for ill also. And I fear what KIND of anti-speculative policy the current ag-politics world would pass. That is all I was trying to say. Sorry if that offends.

Maybe I'm agreeing with Sharon - profiteering is a better term than speculation. Down with profiteering, but not all speculation is profiteering.

That's my 2 cents.

Brian M. said...

Speculation is always characterized by the use of leverage?

Now we are just talking past each other. That isn't what I mean or meant by speculation, I think the term is much broader. Maybe we just have a definition fight. What would you call an unleveraged 50-50 coin flip gamble? That sure looks like a speculation to me. Here I'll call my broad notion "agiotage" if that feels better, and we can use "speculation" for only leveraged deals. Then I'll say that "agiotage" can often benefit small farmers, even though some forms of it can be destructive, and CSAs are "agiotage" but not "speculation" because they aren't leverage, does that make you happy? And my CSA does have a clearly defined location of delivery, although I will concede it isn't precisely fungible.

Jeez it's not as if words like this get used in one unique way. Think about the farmers as well as the food buyers, and if you remove mechanisms designed to help them plan for the future, then replace them with some other mechanisms to help keep the small farmers functioning, that's the political upshot of what I was trying to say.

Anonymous said...

Emailed it to 12; called my Senator. :-)

AleciaMarie said...

I posted it!

Thank you, Greenpa, for actually doing something.

Jenn said...

I posted it on my opendiary blog, my blogspot blog and my myspace blog, along with notifying 25 new people about my greenandgreasy.blogspot.com address. Good work spreading it man! : )

auntiegrav said...

Good stuff. Thank you.

Will pass it on.

Deb G said...

Just wanted to let you know I linked to your post at my blog.

Thank you for being angry and for acting...

Sue in the Western Great Basin said...

My blog is new and small and only read by a few, but I posted it anyway. And I'll email it too, to a list including to my former coworker at the NGO hunger organization where I worked, as well as my other former hunger co-worker who now works for the UN Environment Programme.

TB said...

Greenpa, I've linked on my blog and am writing to my federal representative. Cheers from down under.

Mrs Green said...

I've written something on my blog now. Nowhere near as provocative or articulate as yours, but I've linked to you so that people can get more information:

http://littlegreenblog.com/2008/04/19/food-precious-commodity-or-basic-human-right/

with best wishes,
Mrs Green

katecontinued said...

I posted on make-a-(green)plan, O104: OUTRAGE! and in a post earlier this week about Old White Men.

Laura in So Cal said...

I wrote to my Senators and Congressmen for California with a few words and a link to your post. I also wrote to Clinton, Obama, and McCain with the same thing. Reading some of the links made me cry, but especially the article with the mother in Haiti who wanted to give away her children so that they would be fed.
Laura

jay moses said...

brian has a reasonable point. when markets are international, speculation does serve a function; it allows farmers and buyers to lock in prices and avoid surprises. the answer to the grotesque excesses of speculation is relocalization. large scale speculation requires a national or international market in food. a csa really is a form of futures market and it serves a valid function.

Kati said...

Hi Greenpa! I've been reading your comments over at Sharon's blog for a while now and finally am commenting here as well. I've posted a link to this post of yours over at my place with a plea for my reader-friends to read your post and to make an effort to do something as well.

Thank you for finally compiling the information all into one post, and for giving us a firm idea of what we need to write our representatives and senators about regarding this criminal activity.

Greenpa said...

Jay Moses-It is NOT reasonable for hedge funds, etc., purely for profit, to buy futures contracts- and garner price increases of 20% along the way. And in no way is it NECESSARY. They buy contracts "to deliver grain" on a certain date; never have possession of the grain, and NEVER have any intention of delivering it.

These are the same people who sold the idea that all that "sub-prime" mortgage monkey business was for the purpose of "spreading risk" so broadly no collapse would be possible. Either they had no idea what they were doing- or they were lying in their teeth. Either way- we should not listen to them ever again. People are DYING - real people- really dead- because of their armchair opinions and gambling obsessions.

I have NOTHING against farmers- who grow the crops- using futures to spread risk. But the process of allowing pure speculator/profiteer/ murderer/thieves to participate in the market is not necessary, and has to stop. Just hang a big sign on the market: Farmers/shippers/processors only. Or something like that. Will it be easy? NO. Will it be 100% equitable? No. Will it be better than doubling the price of wheat and rice in one year because of billions of dollars being dumped into the market pushing the price up - bubble fashion- for no good reason? Vastly.

Theresa said...

I couldn't read past the story of the mother offering to give one of her children away to anyone who would feed her/him. I'm sickened, and sad, and angry and disgusted, revolted and almost gagging at the obscenity of it all. I'll go back and read the rest in a little while when I calm down a bit.

I was able to scroll down to the action part, and to start I will write about it on my small blog and send it to my contacts and incorporate it into the letter I'm in the middle of writing to my provincial MLA, and the ones I will be writing to the Premier and Prime Minister, again. I will talk about it to people, and I will find out what else I can do. I think food issues are my 'iceburg' but I hadn't thought about it on this scale before. I am ANGRY and I will ACT.

Fr. Peter Doodes said...

Hi,

Interesting to note that brian m said that "allowing futures also allows speculators." The problem for the majority of those in the world is that they have no future.

Blessings.

Teartaye said...

Posted on my blog...

I don't get much traffic, but I tried. :)

Rewarp said...

First off, I readily admit I am no expert in financial economics, speculation, or derivatives.

However, I do understand what generally what this article is describing is utterly abhorrent. Hoarding medical supplies or food for the purpose of profit goes against every moral fibre that makes us human.

That profiteers earn something by starving others almost makes one wish alien ships would come along and brainwash all of us.

However, controlled speculation is a viable alternative.

I am a citizen of Malaysia, and during the financial crisis of 1997, the value of the Ringgit crashed as a result of currency speculation. A practice, I am sure, is more pervasive than food derivatives in the modern market.

Our previous Prime Minister, Dr Mahathir Mohammad, immediately pegged the Ringgit(RM) to RM3.80 = US$1.00. While having the foresight to implement capital controls.

Renowned financial institutions advised against these measures, but guess what?

Malaysia recovered faster, or at least, just as fast as her other Asean neighbours.

What this proves is, futures trading, profiteering, or whatever you wish to call it can be measurably controlled without jeopardising the underlying economy.

And by the way, Malaysia does not have a food crisis. Our government subsidises our staple food and has long implemented ceiling prices for certain goods.

While the subsidy system is open to abuse, and has been abused; overall, we can still live with little concern regarding our next meal.

I stand corrected for any factual errors I may have committed.

iemagic said...

I have written an email to my close friends and family and will be writing to my congressmen. Thank you for bringing it up and I'm pushing on the iceberg too.

Amber said...

Hi Greenpa. I've posted to my blog.

craftycorner said...

You are on two blogs now...

Tiny farmers can 'speculate' or cushion themselves against a bad harvest of one or two crops if they grow a multiple harvest farm.

Cuba has such a system, of many small & tiny farms producing a good portion of it's food inside the city of Havana.

equa yona(Big Bear) said...

I wrote to Bread For The World today suggesting that they consider this as an 'offering of letters'. If you don't know BFTW check them out it is a great organization.
http://www.bread.org/

equa yona(Big Bear) said...

Here is another good article about the food crisis and the desperate need for increased regulation and food reserves.
http://www.foodfirst.org/en/node/2099

d said...

Thanks for posting this horrifying news and connecting the dots in a way for us! I have posted on my blog, linking to your site, and contacted my Senators and Representatives

historicstitcher said...

OK - I'm a little behind here, but I've posted to my .blog, publicizing this and linking back to your posts

Thank you for so many educational posts lately. While I've been aware of some of these issues, I did not understand the food speculation until this week! Nor did I understand the impact it has on the world's supply.

Jill said...

I posted on my blog and linked to yours. It's only read by a few, but maybe my husband and mom will be better informed. :) Thanks for the info, the effort, and doing something about it!

Jessica said...

I have posted to my blog, written senators, legislators, and representative. I have also posted to my local food buying co-op. Thanks for your work.

Dana Seilhan said...

One point about the business aspects of organic- eventually, the rising costs of fuel SHOULD make the competitive aspects of organic/non-organic tip in favor of ORGANIC. Commercial fertilizer is made mostly from natural gas. Then shipped - it's heavy, and takes a lot of diesel to move. And spread. Most organic farmers use only on-farm inputs; manure or green manure. That's going to turn out to be a HUGE benefit, very soon. Likewise- pesticides- can only get much more expensive.

This is what happened in Cuba after the fall of the Soviet Union! We should also be growing more food in the cities. How many city lots are vacant or have decrepit properties on them that will never be lived in again, which could be converted to food production?

In my town, Columbus, Ohio, we have a program where you can rent a vacant lot for... a dollar per growing season, I think?... and grow food on it. Other cities need this program too. It might make a huge difference in the long run. People need more than just grain and beans to survive, anyhow.

Multi-Media Artist said...

Alright... I posted. Some people would look at this as population control. Sad.

Anonymous said...

I'm a little late to the game here as I just stumbled upon your blog in an effort to educate myself. While I don't have an active blog, I did email my senators and congressman here in CT, in both instances including a link to your powerful messages.

I have a three year old daughter and the idea of being brought to such desparation that handing her over to a stranger so she can eat is the only option is unfathomable to me. It is hearbreaking and outrageous.

Thank you for enlightening me.

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