“This is not a natural disaster,” says Robert B. Zoellick. “Make no mistake – there is nothing natural about this. But for millions of people it is a disaster.” The President of the World Bank gives more warnings – over a hundred million people have been pushed into poverty. Two billion are on the verge of disaster. Already three and a half million children die of starvation every year, and the number is set to rise.
Of course what he is talking about is the food crisis that our beautiful, globalised world is experiencing. For us it means that the prices in Tesco’s and Sainsbury’s have gone up a bit, and we might have to forego some tasty fruits, but in the developing world, as always, it is a matter of life and death. It is a big problem, with many faces. It is a problem that can result in wars, as Mr. Zoellick warns. It is a problem that has its roots in many causes, not least our drive to switch to biofuels.
It was a solution to a problem that is facing the whole planet – climate change, the buzz word of the past twenty years. An all too real buzz word, as we all know and the Intergovernmental Panel on Climate Change (IPCC) has told us. No-one, least of all this author, is questioning the existence of the phenomenon – one that is intricately linked to the present food crisis in many ways – but some questions do need to be raised about our solutions. Climate change can and will lead to dramatic problems in agriculture, as more grassland turns into arid desert and as two billion people live in the shadow of the melting Himalayan glaciers that can flood vast areas of agricultural land. But is one of our precious solutions – biofuels – really the way to go?
Up to the mid-1980s, the Green Revolution in agriculture increased world grain output by an unprecedented two-hundred-and-fifty percent. The energy came from the usual sources – oil and natural gas that was used in pesticides, fertilisers and hydrocarbon fueled irrigation. Hand in hand with that went agricultural subsidies, tax incentives and all those benefits that kept our farmers in business, making sure that it was profitable to drive a tractor. And what happens when we create the inevitable surplus? We sell it on the foreign market below market value.
Cambridge economist Noreena Hertz pointed out a couple of years ago how protectionism was not encouraged by the World Bank and the International Monetary Fund in their approach to helping developing countries. Structural adjustment programs skewed their economies by encouraging governments to disengage from irrigation and land policies, while their markets were left open to the cheap, subsidised food of the West. How can an African farmer compete, you may ask? Well, he can’t. We face stark choices – when the local agriculture fails to deliver, do we send food aid, driving the farmers out of business even further; or do we subsidies them for long-term benefit while millions starve in the immediate future? The mega-cities of the Southern hemisphere, highways lined with families driven off the land – these are the testimonies to this international approach.
So we have established our network – people survive on cheap food rather than crops that they could get ten miles down the road. Then what happens when the West decides that cash crops, especially fuel-producing ones, are the way to go? Brazil has long been the world leader in biofuels, although this year they were outproduced by the USA by two billion litres. It is not just the USA, of course – it is fashionable to dump all the blame for problems on them. France, Britain and Germany have all been subsidising biofuels with tax breaks and mandated use. It makes sense given the rising oil prices, with Russia and others deliberately slowing down production in order to prolong the period – it also cashes in on the global concern for climate change prevention. But it also leads to distortions – eighteen percent of the grain crop in the USA will be converted to ethanol in 2008; the corresponding number for corn is twenty per cent.
Our farmers are growing corn and soybeans as we strive for cleaner ways to run our cars in an atmosphere where energy independence becomes more and more important. But after helping to destroy native agriculture in other countries – inadvertently or on purpose, depending on what your view of the global market and economic system is – we have now pulled the rug from under them. A threefold increase in food prices is effectively just that.
The irony is that ethanol is not the solution. It is not only a relatively ineffective fuel, but it is planted, grown and ploughed using the fuels that we are trying to replace. Our tractors and combine harvesters need petroleum and oil, but not only that – our fertilisers need natural gas. As the soil gets exhausted – as is already happening in the American Midwest – more and more fertiliser is needed. So more natural gas is needed for more fertilisers. See where this is going?
Biofuels are profitable. They are popular. They will keep our cars running. As a smaller proportion of our income goes on food and nutrition than that of people in developing countries, we can afford to live our old lives. We can have fruits out of season and in season. But as population grows, and China and India start feeding their people better – after all, they are trying to catch up – it transpires that our livelihoods are not sustainable. I can already hear the uncomfortable shuffling in the back – don’t worry, I am not a primitivist. I enjoy watching DVDs and going on cheap holidays as much as the next person. But we need other solutions to our problems.
The problem with alternative energy sources is that they are expensive or only make up for a small percentage of our energy demands. Solar power only provides 2% of our energy, someone cries; hydro-energy adds another 5% says another. But add them together, and we get more manageable figures – in 2006, eighteen percent of the world energy consumption was met by renewables. And that can grow – if we want it too. It makes more sense in this post-peak oil world. Nuclear energy is another way forward – again, uncomfortable shuffling. Save pollution now to dump it on our children forty thousand years hence. But as the IPCC warned us – even if we meet our Kyoto treaty obligations today, we are almost probably past the point of no return on climate change. From now on we only make it worse, and so we need drastic measures. The French have the right idea, with their expansion of nuclear energy.
Do we actually have an obligation to help the developing countries, some might say? It does, in the end, seem to come down to whether you view the world through the prism of human rights or Hobbes. Even discounting whether, historically, we are not responsible for the pickle those countries are in – as Nobel prize-winning economist Amartya Sen might hold – we are definitely responsible for the more immediate state of agriculture in the Southern hemisphere. Our free trade and international programs have made people dependent on our food supply, and now we have effectively denied it to them by raising prices as biofuels become more and more profitable.
Much greater minds have tried proposing solutions for this problem. There are many other factors that contribute to the rising food prices, and they cannot be discounted – the unseasonable droughts, the ruin of many farmers in the developing world by their own governments – Mugabe’s Zimbabwe is an obvious and relevant example, population growth – especially one that is trying to emulate our standard of living, which we have to admit is unsustainable. The mantra of alternative energy has been trotted out ad infinitum, but it is still important – and the way forward. We have to recognize that not all the proposed solutions to the oil problem work equally well – the EU has proposed a five year moratorium on biofuel production as all its impact is assessed. Our international attitude and governance should change too – IMF policies such as structural adjustment programs should be abandoned.
But the bottom line is this: biofuel made from food crops is a major factor in the problem of the current food prices crisis. Encouraging our farmers to shift to the production of profitable crops is plain irresponsible, to put it simply, when we have developed a globalised economy and made hundreds of millions, if not billions, dependent on our grain. In the battle of biofuel versus food, it is the latter that has to win.
Categorised in: Article
This post was written by Victor Petroff