Archive for March, 2006


March 30, 2006

Hey! there all you Readers, it's time for Ta-Ta-Ta…

Ammo for the Afro

March 30, 2006

Some food for thought, as it were: the Left wants the European Union, and the US to liberalise their agricultural sectors by cutting subsisides to their farmers, to allow for development in Africa.

A case is made for bananas, let's suppose. But this is a slippery slope, if you'll excuse the running pun. For we can imagine that bananas are the thin edge of the wedge, a foot in the door. The subsequent flood of food to these markets will undermine their farming sectors. As it should, since their farmers are grossly inefficient. So their farming community will turn to the cities for their livelihoods. The farming capability of these nations will be lost, just as the textile capability of most nations is adversely affected or destroyed by the entry of the Chinese.

However, the issue is one of food security. Africa is not in a position to offer that. Our provision in the short term may be like the equilibrium of a pencil balanced on a point.It would be dangerous to threaten the food source that is currently in place by piecemeal adjustments. The Prairies, etc. however much we may sneer at their fat-bellied tillers, is the bread basket of the world. It is a major supplier of aid, too, to starving regions.

Another angle on this is provided by "There are good reasons not to uncritically jump on the bandwagon promoting "free trade" and ending subsidies. First, it's not at all clear that basing economic development on agricultural exports will allow countries to "trade their way out of poverty," as proponents claim.

Historically, many nations that have relied on export-led development have been foiled by declining agricultural prices on the world market, a problem spurred by over-supply. As a 1992 Oxfam report entitled The Trade Trap notes, "Countries that depend on the export of primary commodities like coffee, sugar, or cotton are caught in a trap: the more they produce, the lower the price falls."Ending lavish subsidies would help this situation somewhat by reducing the "dumping" of artificially under-priced first-world goods on the international market.

It won't help a lot, however, even if the U.S., Europe, and Japan were to eliminate their supports entirely–something that is politically out of the question. The typically pro-trade advocate Nancy Birdsall, along with economists Dani Rodrik and Arvind Subramanian, writes in a recent Foreign Affairs article that International Monetary Fund (IMF) estimates predict, "world prices would only rise by 2 to 8 percent for rice, sugar, and wheat; 4 percent for cotton; and 7 percent for beef. The typical annual variation in the world prices of these commodities is at least one order of magnitude larger."In other words, the famous instability of agricultural export markets would remain a bane of poor farmers struggling to survive.

Likewise, the World Bank's most optimistic predictions suggest that a country with a per capita income of $100 would boost this figure by only 60 cents over the next ten years as a result of trade liberalization. That's hardly a panacea for development.

Small farmers are in the worst position to actually reap any such gains, which are far more likely to be siphoned off by middlemen. Put in competition against giant agribusiness corporations that dominate markets and enjoy great political influence (not to mention access to deep lines of credit and facilities in which to store their foodstuffs when prices are low), those small producers will still find themselves playing a rigged game."

Hello world!

March 29, 2006

Well, it's not exactly nine o' clock on a Saturday, more like four o' clock on a Wednesday afternoon. But here goes, as they say. Where did it begin? There I was, wondering what's a blog to do? My friend, Ben, got me started. I want to talk about and display (I guess I should say here 'blog' for what passes as talking and displaying in the real world. What do bloggers call the real world anyway?) here the following: latest happenings in my life, my cartoons and jokes, strange ideas, my political-economic views. And anything else that comes to mind. Mind you, I'll try to keep it clean and simple. I don't want to clog up the blog. Ok. That's all for now. See next time for something more inspired, and perhaps, inspiring.