Sunday, February 20, 2011

Wheat, the Stuff of Revolutions

By Alan Caruba

In a recent column, Lawrence Kudlow, an economist and popular radio host, opined that “the sinking dollar and skyrocketing food prices (may have) triggered the massive unrest now occurring in Egypt—or the greater Arab world for that matter.”

When barely two percent of America’s population is engaged in agriculture, growing the crops we eat or that is fed to livestock, it is perhaps understandable that the other 98% has no clue how all that food shows up in their supermarkets and restaurants.

Methinks that the turmoil we are witnessing in Middle Eastern nations derives more from the rumblings in empty bellies than in any real concern for human rights.

Historically, food is the stuff of revolutions. It was the origin of the French revolution that toppled the monarchy and, as we watch the Middle East and the Maghreb nations of northern Africa, it was food that was the match that set off the present popular demonstrations against dictatorships of varying description.

The monthly edition of Wheat Life, a publication of the Washington Association of Wheat Growers, always features a look at the status of the “wide world of wheat.” It is particularly instructive this month.

“There’s a reason governments make every effort to keep food affordable. Just ask the deposed president of Tunisia, Zine El Abidine Ben Ali. A popular uprising in the mostly desert country of 10 million was sparked by the self-immolation of a man who was arrested for selling vegetables without a license as well as rising prices, particularly bread.” Ben Ali was sent packing after decades of tight-fisted control.

The price of food along with his thirty years of control toppled Egypt’s Mubarack. As Kudlow noted, the mainstream media are so focused on the turmoil in the streets that it is “overlooking the impact of rising inflation, driven mainly by record food prices.” Egypt is the world’s largest wheat importer but “Egyptian inflation is now over 10 percent while some experts estimate that Egyptian food inflation has risen as much as 20 percent.”

Much of the world’s inflationary woes come right back to actions being taken here in the United States. “Commodities are priced in dollars, and the Federal Reserve has been overproducing dollars for more than two years." As the value of the dollar declines, it drives up the cost of everything everywhere. The rise in food costs said Kudlow is “a global phenomenon. It is a monetary phenomenon as much as anything.”

“In dollar terms,” noted Kudlow, “ the price of wheat has soared 114 percent over the past year. Corn has surged 88 percent. These are incredible numbers.” There is a reason for the increase in corn prices and it is the United States’ idiotic and insane mandate that ethanol, made from corn, be added to every gallon of gasoline. There is no justifiable reason for ethanol.

A look around the world also shows how Mother Nature is playing her role in the availability—or lack of it—of wheat. Do not fall for the “climate change” blather that hides the global warming fraud. Droughts and deluges alike are a normal part of the Earth’s weather and quite beyond the control of dictators or democracies.

In Russia, drought cut the 2010 wheat production of wheat by a third. Its government declared a moratorium on exports until the 2011 harvest. By contrast, China has had seven years of rising wheat harvests, but Chinese agricultural experts worry that grain production is increasingly concentrated in the water-scarce northern region of the nation.

So, while people around the world watch the Middle Eastern turmoil in the streets, it is factors such as the declining value of the U.S. dollar, the U.S. ethanol policies, and Mother Nature that are driving revolution.

A government that cannot affordably feed its people, it will not last for long.

© Alan Caruba, 2011

13 comments:

LarryOldtimer said...

Our insane energy policies add greatly to our woes and the woes of the world. Planting, tilling, harvesting and transportation of food costs have substantially risen as well, adding to the price of food. All require petroleum products as fuel.

Increased transportation costs result in higher prices for everything we buy or consume.

Jeremy Jacobs said...

"Methinks that the turmoil we are witnessing in Middle Eastern nations derives more from the rumblings in empty bellies than in any real concern for human rights".

Of course Alan. It's only the BBC that thinks its about democracy & human rights. The underlying problem is the weak US dollar.

TonyfromOz said...

In a way, this just had to happen.
Once crops are grown for Ethanol, those crops then become more attractive to farmers, as they know there will always be a guaranteed buyer paying a premium price.
Also, because of that, then farmers will withhold the crop from going to the market for food purposes, because they will get that guaranteed price from that other source.
The same applies to Corn especially.
What was not sold into that food chain, rather than be wasted, it was then diverted to Third World Countries.
Not so any more, as all that corn now goes to that designated buyer.
I am absolutely amazed that those people introducing this ridiculous Ethanol for fuel didn't think of this in the first place, and all for what can only be described as a marginal (at best) effect on the environment.
This shows me that those who introduced it think less of their fellow man than they do about the environment.
Methinks the appeal to those who vote with 'Green' tendencies was too hard to resist for politicians looking to get as many votes as possible from every source.

Tony.

Alan Caruba said...

Thank you, gentlemen. You are all spot on. Too bad most people have no idea where the food they purchase comes from.

joetote said...

It's always amazed how our government policy for years has done nothing but thwarted the efforts of our farmers. We pay people not to grow!

As always, you are spot on Alan!

Alan Caruba said...

@Joe: Like all our present problems, that is a legacy of the FDR years when they tried to control all the prices for everything.

Desertrat said...

I can't think of "Americans" without recalling LBJ's "My fellow Merkins..."

Merkins seem to think that food is magically produced in the grocery. You don't need dairies or feedlots.

Water comes from a tap or faucet; no need for dams and reservoirs.

Smelly goop goes away via the handle of the porcelain throne; you don't need any skunkworks.

It's all magic.

However, the most tragic and foolish belief for many Merkins is that the government has money.

TexasFred said...

And WE are using FOOD to make gasohol... When we have more than enough OIL to run this nation at 200% capacity for at least the next 100 years...

Ronbo said...

@Alan:

Once again, you hit the nail on the head!

In my study of revolutions, the ignition system is usually hunger and/or poor economic condition.

Take the American Revolution, for an example. The British seized the port of Boston to cut off trade and totally screwed up the economy of New England and started a depression.

So on top of everything else oppression wise the Tory Administration of King George III was doing to America, a tipping point was reached on April 19, 1775 when the guns began to speak.

Ditto the French Revolution of 1789 and the Russian Revolution of 1917 - People will put up with a lot of oppression from a government, but when the regime can no longer feed the population, the tipping point to revolution has come.

TheJollyGreenMan said...

Hi Alan,

I kept reading your last sentence: -
...A government that cannot affordably feed its people, it will not last for long...
So you believe it is the job of the governement:
- to feed the people?
- to give them jobs?
- to look after them when they are sick, old, and infirm?
- to tell them where they can live?
- to tell them how they should talk to one another and which words they may use?

Sorry man, I disagree with you. Goverment policies create the right conditions for food prices to rise and fall as the market prices fluctuate, if you expect the government to subsidize food, you are inviting the government in to take over your whole life.

Alan Caruba said...

@JollyGreen. It is only because you are inherently ignorant that you completely misinterpret and cannot understand what I actually wrote.

Keep this up and you will be permanently unwelcome here.

TheJollyGreenMan said...

Hi Alan,

You are the owner and host of this site, and you are absolutely right to ban all who overstay their welcome and have offended you as the host.

JLP - Rifleman - 5th South African Infantry Batalion - 1967, somewhat younger than you, from a different continent, with a different mother tongue, and a different perspective on world matters.


You are the Boss, boss.

joetote said...

Let's not forget our friends in the old USSR! The final nail in the coffin there was starvation. And in fairness to the Russians, they for whatever reason were willing to put up with much more than they should have. But once they couldn't get food, the dam broke. As Alan points out, history teaches starvation will lead to revolution!