global famine

Michel Chossudovsky points out in this article that the present food ‘crisis’ is the result of economic restructuring and investor speculation, exacerbating problems created by climate change, poverty and 
other factors causing reduced supplies.

The media has casually misled public opinion on the causes of these price hikes, focusing almost exclusively on issues of costs of production, climate and other factors which result in reduced supply and which might contribute to boosting the price of food staples. While these factors may come into play, they are of limited relevance in explaining the impressive and dramatic surge in commodity prices.

Spiraling food prices are in large part the result of market manipulation. They are largely attributable to speculative trade on the commodity markets. Grain prices are boosted artificially by large scale speculative operations on the New York and Chicago mercantile exchanges. It is worth noting that in 2007, the Chicago Board of Trade (CBOT), merged with the Chicago Mercantile Exchange (CME), forming the largest Worldwide entity dealing in commodity trade including a wide range of speculative instruments (options, options on futures, index funds, etc).

Speculative trade in wheat, rice or corn, can occur without the occurrence of real commodity transactions. The institutions speculating in the grain market are not necessarily involved in the actual selling or delivery of grain.

The transactions may use commodity index funds which are bets on the general upward or downward movement of commodity prices. A “put option” is a bet that the price will go down, a “call option” is a bet that the price will go up. Through concerted manipulation, institutional traders and financial institutions make the price go up and then place their bets on an upward movement in the price of a particular commodity.

Speculation generates market volatility. In turn, the resulting instability encourages further speculative activity.

Profits are made when the price goes up. Conversely, if the speculator is short-selling the market, money will be made when the price collapses.

This recent speculative surge in food prices has been conducive to a Worldwide process of famine formation on an unprecedented scale.

The richest 200 people have about as much money as 40% of the worlds population. The rich have manipulated the markets, regulations and the food system, to push more people into dependency on the economic system.

Since the 1980s, grain markets have been deregulated under the supervision of the World Bank and US/EU grain surpluses are used systematically to destroy the peasantry and destabilize national food agriculture. In this regard, World Bank lending requires the lifting of trade barriers on imported agricultural staples, leading to the dumping of US/EU grain surpluses onto local market. These and other measures have spearheaded local agricultural producers into bankruptcy.

A “free market” in grain –imposed by the IMF and the World Bank– destroys the peasant economy and undermines “food security”. Malawi and Zimbabwe were once prosperous grain surplus countries, Rwanda was virtually self-sufficient in food until 1990 when the IMF ordered the dumping of EU and US grain surpluses on the domestic market precipitating small farmers into bankruptcy. In 1991-92, famine had hit Kenya, East Africa’s most successful bread-basket economy. The Nairobi government had been previously placed on a black list for not having obeyed IMF prescriptions. The deregulation of the grain market had been demanded as one of the conditions for the rescheduling of Nairobi’s external debt with the Paris Club of official creditors. (Michel Chossudovsky, The Globalization of Poverty and the New World Order, Second Edition, Montreal 2003)

Throughout Africa, as well as in Southeast Asia and Latin America, the pattern of “sectoral adjustment” in agriculture under the custody of the Bretton Woods institutions has been unequivocally towards the destruction of food security. Dependency vis-à-vis the world market has been reinforced leading to a boost in commercial grain imports as well as an increase in the influx of “food aid”.

Agricultural producers were encouraged to abandon food farming and switch into “high value” export crops. often to the detriment of food self-sufficiency. The high value products as well as the cash crops for export were supported by World Bank loans.

Famines in the age of globalization are the result of policy. Famine is not the consequence of a scarcity of food but in fact quite the opposite: global food surpluses are used to destabilize agricultural production in developing countries.

We’ve all been fed the lie of ‘the american dream’, forced to sell our time/labour for cash, to be part of the system that centralises power and control into the hands of a few.

Coinciding with the establishment the World Trade Organization (WTO) in 1995, another important historical change has occurred in the structure of global agriculture.

Under the articles of agreement of the World Trade Organization (WTO)), the food giants will have unrestricted freedom to enter the seeds markets of developing countries. The acquisition of exclusive “intellectual property rights” over plant varieties by international agro-industrial interests, also favors the destruction of bio-diversity.

Acting on behalf of a handful of biotech conglomerates, GMO seeds have been imposed on farmers, often in the context of “food aid programs”. In Ethiopia, for instance, kits of GMO seeds were handed out to impoverished farmers with a view to rehabilitating agricultural production in the wake of a major drought . The GMO seeds were planted, yielding a harvest. But then the farmer came to realize that the GMO seeds could not be replanted without paying royalties to Monsanto, Arch Daniel Midland et al. Then, the farmers discovered that the seeds would harvest only if they used the farm inputs including the fertilizer, insecticide and herbicide, produced and distributed by the biotech agribusiness companies. Entire peasant economies were locked into the grip of the agribusiness conglomerates.

With the widespread adoption of GMO seeds, a major transition has occurred in the structure and history of settled agriculture since its inception 10,000 years ago.

The reproduction of seeds at the village level in local nurseries has been disrupted by the use of genetically modified seeds. The agricultural cycle, which enables farmers to store their organic seeds and plant them to reap the next harvest has been broken. This destructive pattern – invariably resulting in famine – is replicated in country after country leading to the Worldwide demise of the peasant economy.

The creation of terminator genes and breeding of food plants that cannot be replanted is a truly evil act. Allowing these companies to dominate our food supply, concentrating on a handful of varieties on a global scale is planetary suicide. Diversity is a life saver when crops fail, as is the ability to save seed from this years crop to plant next year.

Michel Chossudovsky is the author of ‘The Globalization of Poverty and the New World Order’ available from Global Research.

In this new and expanded edition of Chossudovsky’s international best-seller, the author outlines the contours of a New World Order which feeds on human poverty and the destruction of the environment, generates social apartheid, encourages racism and ethnic strife and undermines the rights of women. The result as his detailed examples from all parts of the world show so convincingly, is a globalization of poverty.

This book is a skilful combination of lucid explanation and cogently argued critique of the fundamental directions in which our world is moving financially and economically.

In this new enlarged edition –which includes ten new chapters and a new introduction– the author reviews the causes and consequences of famine in Sub-Saharan Africa, the dramatic meltdown of financial markets, the demise of State social programs and the devastation resulting from corporate downsizing and trade liberalisation.