By Esme Choonara
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How the market caused the global food crisis

This article is over 13 years, 6 months old
The leaders of the world’s richest countries have clearly shown that they have no solutions to the global economic crisis.
Issue 2109a

The leaders of the world’s richest countries have clearly shown that they have no solutions to the global economic crisis.

The G8 rulers met in a remote part of Japan last week in the context of looming recession, spiralling food prices and environmental disaster.

But after several days of high powered discussions, the best they could come up with was a warning that the world economy is “facing uncertainty” and a call for governments to take “appropriate actions”.

Gordon Brown’s contribution to the debate as he flew out to join the summit was to tell ordinary people to stop wasting food.

But it is not the millions around the world struggling to feed their families who are wasting the world’s resources – it is the irresponsible politicians and profit-hungry multinationals.

Global food prices have rocketed in the last two years, plunging millions into hunger.

The global price of cereals has risen 88 percent in the last year. Oils and fats have shot up 106 percent, while dairy products are up 48 percent.

This dramatic rise – together with the soaring cost of fuel – has pushed much of the world’s working poor to the point of destitution.

Manuel Alvarez from Honduras is one of thousands of small farmers who have left their land because they are unable to afford to work it or to feed his family.

“For month after month we had only one meal a day,” he told a local aid agency. “We would wake up with empty stomachs and go to bed with empty stomachs. We couldn’t afford the seeds to plant food or the bus fare to go to buy food.”


In some parts of the world, families are literally being forced to eat dirt. In Haiti, for example, some people are living off “biscuits” made from clay because they can no longer afford rice.

The effects of rising food prices are less extreme here in Britain. But with soaring utility bills, rising fuel prices and a government pay freeze, many people are finding it harder than ever just to make ends meet.

Campaign group Credit Action has calculated that personal debt in Britain is rising by an average of £1 million every five minutes – largely through use of credit cards and other borrowing just to pay essential bills and housing costs.

Underlying the world food crisis is the way in which food production has been incorporated into the world market – turning food from a basic human essential into a profitable commodity.

This means that although there is easily enough food to feed everyone on the planet, people go hungry simply because they cannot afford to buy it.

A small number of huge agribusinesses now dominate the global production, processing and distribution of food.

For example, the US firm Cargill, which operates in 66 countries, saw its annual profits shoot up by 82 percent last year.

Speculation on food markets has also helped drive up prices. The financial turmoil caused by the “credit crunch” has led the wealthy to pour their money into commodities as a safe way of making higher returns than on shares or bonds.

But their drive to make quick money out of rising commodity prices has caused sudden leaps and lurches on those markets.

The rising cost of oil – needed in large quantities for industrial scale farming – has also pushed up the prices of food and helped to drive smaller farmers out of business.


The other major contributor to rising food prices is the diversion of land for the production of biofuels. The biofuel industry is extremely profitable and highly subsidised – in the US there are more than 200 forms of government subsidy on offer.

Biofuels use up huge tracts of land. The World Bank estimates that the amount of maize used to make fuel to fill the tank of one sports utility vehicle would feed a family for a year.

Production of biofuels also creates more carbon dioxide emissions than it saves, because of the large amount of inputs and energy spent in deforestation to clear land for crops.

But because biofuels are such a profitable growth industry, many governments are reluctant to criticise or regulate them.

A British government-commissioned report last week was very critical of the biofuel industry. But New Labour transport minister Ruth Kelly would only say that the government would “proceed cautiously”.

Our rulers may not be willing to act, but those directly affected by their market policies have unleashed a wave of resistance that has shaken governments across the globe.

From strikes in Egypt and Bangladesh, to protests in Peru, Mexico and Indonesia, to riots in Mauritania, Haiti and Burkina Faso, people have fought back to demand price controls on food and wage rises to cope with the price hikes.

The strikes against the pay freeze in Britain are part of this resistance – a part of ordinary people across the globe refusing to pay for the market’s crisis or the bosses’ recession.

Hunger in a World of Plenty – what’s behind the global food crisis? by Esme Choonara and Sadie Robinson is available for £1.50 from Bookmarks, the socialist bookshop, phone 020 7637 1848


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