Economics and Society: The food crisis as crisis of imperialism


By ARTURO BOQUIREN

In an attempt to shift away the blame on the food crisis a.k.a. “food price crisis” from her administration, President Gloria Macapagal-Arroyo tried to misrepresent the food crisis as a world crisis in which the country can do nothing about.

True, the current food crisis is a world crisis. More accurately, it is a crisis of imperialism. It is crisis of an economic system that relies too much on trade liberalization, a policy rammed down on our throats by the International Monetary Fund and the World Bank through their paid hacks. Imperialism continually attempts to create a world in which people are dependent on the market because that would imply that corporations rather than the state control public life.

Through a control or dominance of the purse, United States imperialism has effective control on the International Monetary Fund and the World Bank even if they are multi-lateral bodies or organizations supposedly established by several nations. The two are the prime instruments of imperialism in promoting free-marketeer economics.

The Arroyo administration is a willing accomplice in the promotion of the erroneous policy and is, therefore, just as accountable as the International Monetary Fund and the World Bank for the food crisis that we are in. In fact, President Arroyo, during her senate years, was one of the sponsors for our blind subservience to the policies of the World Trade Organization.

The current food crisis that we are in is not simply attributable to the oil price hike. Yes, the oil price hike is contributory but it is not the main cause of the food crisis. For instance, the price of many varieties of rice has risen today by as much as 50% since January of this year but the price of oil has risen by much less. Further, oil is only a small percentage of the production cost of rice.

We cannot blame supply and demand as the principal cause of the price hikes. For instance, during the first quarter, world demand for oil decreased from 86.66 to 85.73 million barrels per day while world oil supply increased from 85.49 to 86.17 million barrels per day. Based on the figures, the price of oil should even decrease. Yet, the price of oil increased by around 20-30% today from January 2008.

Indeed food riots have taken place in many parts of the world. However, the riots did not take place in all parts of the world. Internal policies play a role on whether we will be vulnerable to a world crisis that is the creation of imperialism.

By refusing to adequately assist farmers on their production woes, the Arroyo administration is directly responsible for the food crisis we are in. The developed nations are known for their subsidies on agriculture. Conventional economists like Arroyo frown at subsidies on agriculture but developed nations simply ignore the mental baggage of the conventional economists.

Developed nations subsidize their agriculture as a pragmatic approach to policy: the world has risks, the markets may be working well today but they may not be working well tomorrow. A pragmatic approach to policy bet on two workhorses: the workhorse of the market and the workhorse of the state. If one fails to provide food, the other can fill up the inadequacies or shortcomings of the former.

Markets promote efficiency but they are good in promoting efficiency for goods whose sole value is monetary. Unfortunately, however, the value of a good is not only monetary but they can have intangibles or values that are not immediately quantifiable with monetary equivalent.

Food production, for instance, may not be the option that would provide the highest monetary returns for land. However, if there is no food production, food security will be affected and the food insecurity will be translated into food riots, disorder, and social discord. The end result can be dangerous to society. Market prices do not capture the costs associated with food insecurity when markets make a decision on prices.

Even the fundamental theories of economics say that welfare level is not necessarily lower when an economy is inefficient. Welfare level can even be higher in spite of the inefficiency that may result if markets are not working well. For instance, the goods that society produces may not be those that would yield the highest returns and there can be inefficiency. However, if the set of goods guarantees food security for all, welfare level can be at the highest level.

Another way of looking at the problem is this: markets can be good at allocating resources in terms of short-term efficiency but state leadership, especially if people’s interests control the state, can take a longer-term view. As long as imperialism is dominant, however, it would be difficult for the state to take a longer-term view. State policies will remain free-marketeer. #

(The writer maintains a blog at http://www.geocities.com/arturoboquiren. Comments can be coursed through http://www.nordis.net, artboquiren2040@yahoo.com, and +63927-536-8431)

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