Latin America’s Food Crisis

Even a year ago, few people would have predicted that a global food crisis would make headlines as one of the major concerns for the future of the world. Yes, critics of agrofuels warned that food shortages and price hikes would result from the headlong rush to divert land from food to fuel production. And climate change experts predicted that global warming would hit small farmers—who even in today’s world of industrialized agribusiness still produce much of what we eat—the hardest. Agricultural economists alerted the world to the dangers of leaving the food supply to a highly concentrated international market.

But all these threats seemed nascent, not imminent.

So what happened? How did we get to a full-blown crisis, with children who before were fed going to sleep hungry, with rioters banging empty pots in the streets, with mud cakes standing in as dinner?

The answer involves all the dire warnings above. How they have played out depends in part on where you are. The interplay of pests and policies, drought and dollars, futures and farmers has always made agriculture a hard call for both almanac writers and policymakers. But international trends and a case-by-case analysis show common culprits.

In the Western Hemisphere, two countries—Haiti and Mexico—reveal the forces that are leading societies into a crisis that could become permanent if deep changes aren’t made to our food and agriculture systems.

The standard explanation for the global food crisis rests on the convergence of the demand for food crops due to agrofuels, the hike in gas prices, urbanization, increased demand from emerging economies, climatic changes, and environmental deterioration from erosion and pollution.

All of these factors have played a part in the crisis. Agrofuel development has been mandated well into the future, although it may be slowing down as criticism mounts. A recent report by the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) blames biofuels in part for price hikes. The report concludes, “Governments need to carefully consider the impact of bio-fuels on the poor.” Gas prices are likely to remain high. With so much food moving around under free trade policies this will continue to affect the price and access.

With agribusiness corporations posting record highs (like Cargill, ADM saw profits soar from $363 million in 2006 to $517 for 2007) and investors salivating over “ag-flation” windfalls, it’s clear that what’s a crisis for some is a bonanza for others. That in itself should be a clue that the structural problems with the global food system do not lie in poor yields, “inefficient” small farmers, or climatic disasters. It’s manipulated prices; faulty trade, aid, and promotion policies; distribution and wrong priorities that are starving the world’s most vulnerable inhabitants.

Oddly enough, international solutions do not address these fundamental issues. Policy prescriptions from the wealthy countries and international financial institutions emphasize hand-outs and more free trade. They tend toward increasing, not diminishing, developing country dependence on imports and aid, and further lining the pockets of the companies that are fleecing the public.

The World Bank’s proposals include: “calling on the international community to make up the $500 million food gap required by the UN’s World Food Program to meet emergency needs,” increasing its loans for agriculture (promoting the same model that led to the loss of food sovereignty in developing countries facing today’s food crisis), “expanding and improving access to safety net programs, such as cash transfers, and risk management instruments to protect the poor” and strengthening free trade through “advocacy on the negative impacts of policies such as export bans, which create price spikes in importing countries, and the high levels of trade tariffs and subsidies in the developed world.” World Bank President Robert Zoellick, IMF Director Dominique Strauss-Kuhn, and former WTO President Pascal Lamy have all used the food crisis to argue for a reinvigorated Doha Round of the WTO to deepen the free trade system. This constitutes an offensive against measures that question the international markets which helped cause the food crisis.

The mass media portrays “food riots” in Latin America—demonstrations in the streets of Haiti, women banging on empty pots in Lima, cries for an affordable tortilla in Mexico—as ominous signs of instability. Instead they should be seen as wake-up calls to fix our most vital link to each other and to life itself—the food system.