The Food Ordeal & Climate Change

The United States is “the breadbasket of the world” and the largest exporter of corn, soybeans, and wheat, accounting for one in every three tons of staple grains that feed the world. Over the past month, futures prices for corn and wheat are up approximately 50 percent. The culprit behind this abnormal pricing behavior is a major drought that is scorching one-half of the breadbasket of America. The U.S. Department of Agriculture declared on July 11 that more than 1,000 counties in 26 states are natural-disaster areas, the biggest such declaration ever.


According to the Economist (December 2007), by the end of 2007, when high grain prices sparked riots in 48 countries, the magazine’s food- price index reached its highest point since originating in 1845. As of July 2012, corn is back to those same 2007 peak prices, wheat is rapidly approaching the same high levels, and soybeans are at multi-year highs and the U.S. drought has only begun—maybe. Thankfully, rice, which feeds one-half the world, is still at its midpoint and has been for the past five years.


Food shortages and high food prices pose a huge potential strain for worldwide governments and tottering capitalist socio-economic systems. According to Abdolreza Abbassian, senior economist with the UN Food & Agriculture Organization, “The world looks to the U.S. as the safest source of supply…. Everyone watches the U.S. because they can rely on it. Without it, the world would starve.”


The Arab Spring uprisings of 2011 brought political and economic issues to the forefront, but behind the scenes, climate stress played a big role. The warning behind Syria’s disruptive climate change, i.e., drought, is chilling. Syrian farmlands north and east of the Euphrates River are the breadbasket of the Middle East and up to 60 percent of Syria’s land had one of the worst droughts on record from 2006-11. In the northeast and the south, nearly 75 percent suffered total crop failure. Herders in the northeast lost 85 percent of their livestock. According to the UN, 800,000 Syrians had their livelihoods totally wiped out, moving to the cities to find work or to refugee camps. Furthermore, the drought pushed three million Syrians into extreme poverty. As of January 2012, Abeer Etefa of the World Food Program, states, “Food inflation in Syria remains the main issue for citizens.”


Capitalist nation-states are already under more financial duress than at any time since the Great Depression. However, unlike the 1930s, it is the developed nations that are underwater with debt ratios.  


The good news is that a grain shortage by itself will not develop into an uncontrollable inflationary spiral because the contributions of “agflation” on core PCE Indexes (Personal Consumption Expenditures) will affect a limited range of final goods (“Current Issues in Economics and Finance,” Federal Reserve Bank of NY, November 2008). However, price increases of food components are brutally severe for individual households the world over.


According to a landmark study, the World Development Report 2011, in “Food Insecurity and Conflict,” authors  Henk-Jan Brinkman and Cullen S. Hendrix write, “Food insecurity is both cause and a consequence of political violence.”


There is direct evidence that disruptive climate change caused the political fires that burned across North Africa one year ago and then were kindled in Russia. Extreme drought triggered wildfires and destroyed one-third of Russia’s wheat harvest. Russia refused to export the rest of its harvest. Markets panicked and food prices shot up.


“Definitely, it is one of the causes of the Arab Spring,” says Shenggen Fan, director-general of the International Food Policy Research Institute. It is increasingly clear that the climate models that predicted the countries surrounding the Mediterranean would start to dry out are correct (“Human-Caused Climate Change Already a Major Factor in more Frequent Mediterranean Droughts,” National Oceanic and Atmospheric Administration, NOAA, October 27, 2011).


Meanwhile, today in the United States, NOAA says, “…the 12-month period from July 2011 to June 2012 was the warmest on record since recordkeeping began in 1895.” And, to make matters even worse, Central and Eastern Canada’s drought is “baking crops,” says David Phillips, senior climatologist with Environment Canada, who goes on to comment, “…it’s almost as if the atmosphere has forgotten how to rain.” Michael Oppenheimer, professor of Geosciences at Princeton University states, “What we are seeing is a window into what global warming really looks like.”


These concerns with global warming are “poppycock” according to one leading Republican, Rick Santorum, who informed Rush Limbaugh in an interview in June 2011, “…global warming is ‘patently absurd’ and ‘junk science’.”  Leading right-wing mouthpieces like Ann Coulter claim climate researchers are “cult members” who practice deception.


As for Mitt Romney, while holding one finger up in the air, testing the direction of the latest polling breeze, he claims, on the one hand, he’s not sure “if humans are causing climate change,” but on the other hand, he is not a “denier of climate science.” Talk about a safe bet.


It is disturbing that anybody would deny climate change with 97 percent of scientists saying human-made climate change is real—according to the National Academy of Sciences, after posing the question to 1,372 scientists (USA Today, June 2010). 


Contrary to American politicians’ positions on global warming—including several former Republican presidential candidates who recommend “gutting” the EPA—Yale University’s list of the world’s greenest nations demonstrates sensible/sober/prudent politics at work: “…countries that are attentive to good environmental management have good business management as well.” For example, Scandinavian countries have made investment in environmental business an important part of their economic base.


The largest solar power company is in Norway, which is number three on the Yale University list. The United States is Number 39, behind Costa Rica and several Eastern European countries, as well as Japan, Germany, and the UK, all of which rank better than the U.S.


According to Marco Lagif of the New England Complex Systems Institute (NECSI) in Technology Review, MIT, (August, 2011), the single factor that triggers riots around the world is the price of food. The evidence comes from data gathered by the United Nations that plots the price of food against time, the so-called food price index of the Food and Agriculture Organization of the UN. Other evidence points to the dates of riots around the world, whatever the cause.


On December 13, 2011, four days before Mohamed Bouazizi set himself on fire in Tunisia, starting the Arab Spring riots, NECSI contacted the U.S. government, warning that global food prices were about to cross the tipping point when almost anything can trigger riots. The NECSI study was presented, by invitation, at the World Economic Forum in Davos and was featured as one of the top ten discoveries in science in 2011 by Wired magazine.


Lagif and colleagues have isolated two predominate causes for out-of-control food prices, in addition to normal supply and demand: (1) deregulation of commodities, resulting in speculators who can control unlimited purchase contracts and (2) conversion of corn into ethanol. Here we go again.


The deregulation quandary, the predominate theme of the right wing and a favorite of Romney’s, pops up every time trouble brews, similar to the 2007-08 financial meltdown and the direct connection between that travesty and Congress’s deregulation (killing) of the 1933 Glass-Steagall Act, which had kept commercial banks out of speculative securities for over 60 years.


Yes, disruptive climate change is a source of uprisings. In this regard, it is fascinating and horribly frightening that the political right wing continues to support policies that ignore the ravages of global warming.


With grain prices cranking up once again and with commodity speculation wide open, blessed by deregulation, providing for unlimited purchase contracts that conform to manipulated control of pricing, the great betting game on grains will most likely result in food riots. As certain as riots are expected in many underdeveloped countries of the world, a North American Spring is not out of the question. 


Robert Hunziker lives in California and has published articles in Counterpunch and Firebrand Magazine.