don't believe everything you read. The synopsis of the article is "the USA is causing mass starvation by distilling their surplus grain into fuel, as opposed to donating it to the poor". You can't really
be buying into that, can you?
There seems to be an adjustment beginning in the macroeconomics of grain. Think supply vs demand. Right now, parts of the US grain harvest are being diverted to make fuel. That causes a rise in value of the grain, since demand has remained constant. The higher price will cause US farmers to plant more grain.
We, as a nation have committed massive chunks of excellent cropland to the construction of cheap housing, from the basic tract homes to your standard McMansions. This land is out of production forever. There's no reversing this, so let's talk about a more realistic option to bring land into production quickly.
We have a significant fraction of our cropland within the Conservation Reserve Program, or CRP, which is out of production today. This land has been utilized to grow grain in the past, so it's relatively easy to bring back into production. As more land becomes usable to grow grain, the supply-demand equation tilts back toward supply and prices come back down. The CRP Program
is a $1.8B enterprise as of 2008. We should reconvert this land into farming.
Let's talk about price controls. The government will guarantee an inflated price for crops, including grain, and then buy the surplus at the control price. In order to keep farm prices up, the US government buys those crops and dumps them on the world market, either as donated foodstuffs or at firesale prices. This is in no way helpful, since it has the effect of reducing worldwide farm production. Look at it this way: What farmer in Shakeyourbootystan is going to put the time and money into bringing new cropland into prodction when Uncle Sam is giving the grain away for less money than he can hope to make? Less production of grain means more dependance on Uncle Sam. What happens when Uncle Sam decides that he needs that grain for US consumption? Problems, big problems, since the world supply of grain is suddenly less than the demand. We should do away with price controls, which are essentially farm welfare.
Famine is nothing new. We know what causes famine: A population outstrips its ability to grow enough crops to feed itself. Welcome to the twentyfirst century version of famine, caused by overpopulation and government blunders. The seeds of the current famine were sown, if you will, by well-meaning government programs. Oh, hey, that's nothing new, either. The Potato Famine
was caused by similar pressures as the British Government converted Irish agriculture to potato production as a method of feeding its increasing population. They meant well, but the potato crop failed and there was no other crop to act as a safety net. 1/4 to 1/5 of the population of Ireland died and a like amount emigrated.
Now, a compelling argument can be made that the US should continue to provide cheap grain to the world, even if the US taxpayers need the grain for ethanol. Another equally compelling argument is made that the US government's primary responsibility is to US citizens. Which argument do you think will win in 2008, an election year? Those who are hungry in Haiti don't vote for Hillary, Obama or McCain.
Well, that concludes this rant. I am wearing my asbestos suit, so let the flames begin.