Re: Global Proverty Increasing...

On Wed, 02 Jul 2008 01:53:09 -0700, BeeJay Rainbow wrote:

On Jul 2, 3:50 am, BeeJay Rainbow <beejayrainbow2...@xxxxxxxxx> wrote:

Oil, food price spikes may worsen global poverty: IMF Tue Jul 1, 5:34 PM

WASHINGTON (AFP) - Rocketing oil and food prices are being increasingly
felt around the globe and surging commodity prices could worsen poverty
in many poor countries, the International Monetary Fund warned Tuesday.


But are they going to propose something that could actually reduce global
food costs? Or are they going to continue to spew out the same tired
hack lines about free markets/free trade and blame bio-fuels for the
entire problem (even though they only make up a tiny portion of the

It is well know how to lower food cost and get developing nations to
point where they no longer require food-aid. But to do so flies in the
face of economic orthodoxy. It directly opposes free-trade and treaties
like NAFTA which line the pockets of farmers in developed nations by
allowing them to dump subsidized surpluses into other countries, driving
local farmers out of business. This puts local farmers out of business
and puts a strangle hold on global supply. As a result, a drought in one
producer nation (like the one in Australia that is largely responsible
for massive run-up in the price of rice), or a slight change in demand
(bio-fuels), or small changes in land use (such as Australian farmers
turning land previously used for rice over to wine grapes because they
use less water and are substantially more profitable), and global prices
go up sharply.

Fixing the problem is relatively simple. Just put the local farmers back
to work. It worked extremely well for Malawi, which has gone from being
dependent on food aid to being a food exporter. But that could be (is)
viewed as a threat to profit margins of farmers and agribusiness in
developed nations.

Will the IMF suggest things that will really work? We'll see.