One billion people, 1.02 billion to be precise, are hungry: we hear from the Food and Agriculture Organisation (FAO) as it releases its .
Accompanying this unprecedented level of hunger are lowest levels of food aid ‘in living memory’, warned the World Food Programme (WFP), which has collaborated on the report.
According to the WFP chief, the dramatic reduction of food aid may lead to the "loss of a generation of children."
There is, however, a piece in the story of this enormous rise in hunger that has found no space in these deliberations. For that you would have to turn to Fortune magazine, and its of the fastest growing industry globally.
‘Food production’ ranks first by revenue and fourth by profits, led by Archer Daniel Midlands. Of course, food production is not the only industry that affects the food situation.
In fact, vital resources for food production are , vertically and horizontally, at breath-taking speed, with terrible effects on the small farmer in the developing world.
It is this corporatisation of food production, and in particular, the alarming rise of speculation in food that several social movements in the Global South are struggling against. Tellingly, the term ‘speculation’ finds no mention in the Food Insecurity Report; neither does the phrase ‘food sovereignty’ which is the main concern of these movements.
As this omission indicates to us, international institutions, governments and corporations (who are central actors in this theatre), continue to treat hunger as a problem of scarcity and distribution – shifting focus away from the underlying processes which render hunger as a source of private profits.
Once basic needs such as food and water emerge as a source of private profitability, then redistributive measures, such as the minimal guarantees advocated by the MDG campaign, are difficult to ensure.
Why? The reason is simple. Governments and policy regimes which are committed to private control of food (and related resources) are unlikely to be equally committed to the expansion of public control over food. These are two opposing world views. Unless a basic need such as food is publicly controlled with guaranteed universal access, its distribution is likely to be irregular at best – subject to electoral concerns or dependent upon public pressure.
As we see in India, the outcomes can be deeply ironic. While astute politicians , they go unpunished for instituting policy regimes that engender hunger in the first place (such as the systematic contraction of the Public Distribution System).
And globally, the same companies whose profits peaked during the food crisis, are rushing now to . Several agribusiness giants have launched the Global Harvest initiative, a business venture which "will not only bring food to millions of starving people, but it’s ultimately a lucrative source of revenue for their companies."
In other words, the very just demands for redistribution can also become sources of political and economic gain – unless they are coupled with more fundamental demands. This is why major social movements, such as the Via Campesina or the Movimento dos Trabalhadores Rurais Sem Terra (MST) in Brazil or Nayakrishi Andolan in Bangladesh seek explicitly to go beyond the distributive approach.
Their aim is to eliminate private ownership of resources required to produce our basic needs and establish collective/ public control over them. Only then, the movements contend, can the power relations which allow some to profit from the basic needs of millions be altered.
Basic needs as ‘opportunity’
We already know that large corporations saw , and ‘food riots’ broke out in many countries of the South. But there is a more disturbing trend that receives even less attention in the dominant policy discourses. This involves the rise of speculation in food (as well as water and land).
A recent article in Fortune, aptly titled suggests that "Investors looking for safe havens should consider dipping into agricultural commodities", because "the supply-demand balance for agricultural products looks tight over the next five years."
Some reports suggest "investment funds now control 50-60% of the wheat traded on the world’s biggest commodity markets… and speculative money in commodities futures – markets where investors do not buy or sell a physical commodity, like rice or wheat, but merely bet on price movements – has ballooned from US$5 billion in 2000 to US$175 billion to 2007" (See ).
On April 30, 2008, the reported that index fund investment in corn, soyabean, wheat cattle and hogs rose from $10 billion to an astounding $47 billion since 2006.
Note the entry of the ‘small’ investor in the hunger market. Deadly Greed, a report published in during the food crisis had the following story:
"Andreas Grünewald is a star among small investors in Germany. He launched his Munich Investment Club (MIC), together with eight fellow students and his grandfather, in 1989 with about €15,000 ($24,000) in initial capital. Grünewald, a business school graduate, now manages more than €50 million ($80 million) for the MIC’s 2,500 members.
Commodities are a big issue for Grünewald. "They are the megatrend of the decade," he says. His portfolio in this sector is already worth about €15 million ($24 million). … Grünewald says he wants to "remain broadly invested" in water and agricultural commodities, in particular, and "to expand those investments if possible." His bet on wheat alone has produced a handsome profit of 93% to date.
… Scruples are in short supply in Grünewald’s investment club. "Most of our members tend to be passive and profit-oriented," he admits. At MIC’s national events, few people bring up the social consequences of his investment tips. Riots because of exploding rice prices? Aid organisations in a state of high alert? None of this matters much to the preferred suppliers and apostles of profit in the small investor community.
The finance industry regularly introduces new investment "products" for every sexy sector, no matter how questionable (emphasis mine, Der Spiegel, April 23, 2008)."
Note that Grunewald is a ‘small’ investor, a university student. The money he ‘manages’ is also the savings of ‘small’ investors – i.e. the savings of working people, invested often through small private avenues or through pension fund managers who promise lucrative returns (ABN Amro was able to offer 20%). As jobs in the North become scarce, futures become uncertain, the ‘small’ investor may well choose such option, and become participants in the perpetuation of hunger.
The same process is evident in water. Visit Waterthenextoil.com, an investment portal. Its estimate for the , for example, is about $287 billion with a projected growth rate of 40% annually. Companies such as Shell, GE, Siemens, XsunX, Inc., and Hendrx Corp are aggressively pursuing these markets:
"The sheer scarcity of water makes it more valuable than oil TODAY. Long under priced, the cost of water should continue to climb as sources diminish and usage increases. Already certain forms of potable water are more than oil.
Bottled water sells for roughly $1.50 a liter at the gas station right now, while gasoline sells for around $2.50 a gallon. With 3.78 liters in a gallon, bottled water would be selling for $5.67 a gallon—twice the price of gasoline. While we teeter on the brink of a looming global crisis, the fact remains that water is virtually inelastic — as prices rise, consumption does not decrease.
… We are strong proponents of the belief that water will likely be bought and sold in much the same ways as other commodities ()."
The latest in this line of ‘investments’ is farm land, a key resource for the production of food. Buy hedge stocks in farm land, urge the experts:
"This hedge can outperform gold. In Britain, the farmer outpaced the gold owner. Expanding land values rode up 115% since 1983, versus gold at 81%. … If you’re worried about the dollar, the economy, or any other problem, buy farmland today. This is hard to do directly through the stock market, so I encourage you to consider a private deal. You can play agriculture through companies that manufacture irrigation equipment, produce fertiliser, or operate grain-handling facilities (See, ‘‘)."
Not surprisingly, G8 governments have immediately risen to the task of institutionalising the necessary policy regimes which will protect ‘investors’ rights’ on farmland. , "15-20 million hectares of land in poor countries were sold or are under negotiations for sale to foreign buyers" since 2006. The trend is accelerating at breakneck speed.
Does this disease have a cure?
It is in this context of the ever-deepening impetus for privatization, speculation and corporate control of resources that we must assess the efficacy of the redistributive policies. To reiterate, this is not to diminish the struggles for redistribution, particularly those which demand that distributive regimes be enshrined in policy instruments which governments would find difficult to reverse.
However, several key development policy institutions and discourses (such as the Millennium Campaign) call for voluntary action and moral imperatives for ensuring distribution. The World Food Programme, for instance, has just warned that reduced food aid may lead to the ‘loss of a generation of children’. The US alone has cut its aid by $800 million in 2008 ().
At issue here are profoundly problematic understandings of accountability and justice (On notions of justice and development see my recent book ).
Redressing this kind of imbalance requires something more fundamental, as movements like Via Campesina or Naya Krishi in Bangladesh (or the ‘water warriors’ in Bolivia) argue.
Food ‘security’ they say, can only be ensured by ensuring the security of the food-producing households. In fact, ‘security’ is not their goal; neither is ‘aid’. Their goal rather is ‘sovereignty’, deriving from the ownership of resources required to produce food. As Jahanara Begum, a Nayakrishi farmer in Bangladesh told her fellow farmers, "Sisters, keep seeds in your hands".
Our greatest challenge, at this moment, is to bring Jahanara’s voice to policy processes which are increasingly dominated by interests which seek to do exactly what she fears: wrest control of her ‘seeds’, to be understood in the broadest sense – as a metaphor of all that should be inalienable.
Ananya Mukherjee-Reed can be reached at [email protected]