Debt and Food: A Common Cause

Eric Reguly, in the weekend Globe and Mail, tries to compare and contrast two different crisis which originated in 2008: the European debt crisis, and the international food crisis. The two crisis were linked, mostly by nervous money fleeing the world's debt markets for commodities (and both were precipitated by the criminal activity engaged in by various investment banks like Goldman Sachs and Bear Stearns prior to the housing bubble popping). The role of speculative money in causing the worldwide food price inflation of 2008 through 2011 is pretty common knowledge. Starbucks president Howard Shultz, as reported in the The Telegraph, has said:

... the current spike in the cost of commodities such as coffee and other foodstuffs is "not based on supply and demand" but based on market speculation. He said that the farmers who actually produce the commodities are receiving a "de minimus" proportion of the price rises. "Right now we are experiencing a very strange and almost inexplicable phenomenon in the commodities market. Without any real supply or demand issues we are witness to the fact that most agricultural food commodities are at record highs at once, and coffee is at a 34-year high." 

Frederick Kaufmann, in The Guardian, follows up with a brief interview with Professor Yaneer Bar-Yam, of the New England Complex Systems Institute (Necsi):

"Prices have been way out of equilibrium in 2011," Bar-Yam told me. "The bubble has not burst yet." According to Bar-Yam, the international thirst for biofuels has put a strain on arable land previously reserved for food production. At the same time as the rise of the biofuel mandate, the rise of investable commodity indexes and other electronically traded funds has offered investors of all stripes a chance to sink their cash in a sparkling new casino of derivative products. As a result, an ever-flowing spring of speculative capital sustains the status quo. But just as food is no ordinary widget, speculation in commodity markets is not simply a matter of financial predation. "The high prices of food have resulted in accumulations of inventories at the same time as people can't afford food," said Bar-Yam, who noted that the Arab spring was triggered by the food-price bubble. In fact, Necsi's quantitative model of speculation predicted the uprisings in Tunisia, Libya and Egypt, and warned that if food prices remain inflated, riots and revolutions will go global sometime between July 2012 and August 2013. "We are at a critical point," said Bar-Yam. "We don't have a stay-the-course option right now." 

Notice that quote: "The high prices of food have resulted in accumulations of inventories at the same time as people can't afford food." That makes it very clear that this is about speculation, not supply and demand.

Intense (ive) Agriculture

Two innovative projects popped up on my radar (thanks, Jeff!) involving urban farming this week. One is a storefront farm in Hackney, London, called FARM:shop, and the other is Riverpark Farm in New York City.
Both are responses to the fallout from 2008 and the ongoing international economic crisis sparked by American corporate criminality. In Hackney, the number of disused storefronts has sparked a municipal initiative to fill them at least temporarily with art projects and the like. Something and Son took a look at the cubic footage they had available, and created a café/workspace/venue/ and an intensive food production space.

Honestly, Something and Son has the air of an art installation, talking about how their “displays” change with the seasons. They claim to be the world's first “urban farming hub” (whatever that is supposed to mean), but the ideas they've used involving food production are not all that innovative. FARM:shop's food production is directly descended from the work of the New Alchemy Institute (NAI), which, from 1971 through 1991 conducted a major research and education initiative on a farm in Massachusetts. They explored green-housing/aquaculture synergies, formulated the 90-day-compost plans used by most gardeners today, and rigorously documented their work. They even built one of their “Ark “ projects in Prince Edward Island, testing their theories in a less hospitable clime.
The New Alchemists weren't the first either, building on both academic and farm-based work that had gone before them. But, thankfully, they were a part of the 60s diaspora that documented their work,leaving behind not only a record of their work, but a group of people still pushing forward environmental design.

The Earth Can Feed Us

Hugo Osvald, The Earth Can Feed Us, George Allen and Unwin 1966

Hugo Osvald was an academic, politician and writer deeply involved in food security issues back in the fifties and sixties. A professor of crop science at the Swedish Agricultural University, he was also a member of the Swedish parliament from 1948-1963. His book The Earth Can Feed Us is an important look at food security issues and the plans made to confront those issues just prior to the Green Revolution.

As you can see from the title of his book, Hugo was actually fairly optimistic about the ability of humans to feed a population of six billion or so (about double the population at the time he wrote this book). As he says in his preface:

I have also refrained from giving terrifying descriptions of the situation in the over-populated countries, with their starving and diseased populations, or detailed accounts of the mistakes mankind has made in exploiting natural resources. For if we want to improve the situation, it is, in my opinion, necessary first of all to show what possibilities there are of increasing food production. Mankind must be given a gleam of hope, a chance to believe in a brighter future, if it is to make the necessary effort. Otherwise it will become discouraged and apathetic.¹

Hugo provides an overview of the current condition of the food supply circa 1966, and what he sees isn't good. “The sad truth is, that more than half the world's population of more than three milliard people has not enough to eat.²” He also did not think, after reviewing the numbers, that even with perfect distribution there would be enough calories to go around at the then current rate of production. Whether there is currently enough to go around is still one of those open questions; if you cancel biofuel production in the US and quit feeding so much livestock on so much corn, there might be enough calories produced. But practically there will never be enough, if only because those that have access to food are in no hurry to give it up to eat a 2300 calorie/day diet high in grains and low in animal protein.