Global Hunger And Free Markets

Global Hunger and Free Markets by Uma Shankari in Economics, September 3, 2009 A new multi-billion dollar U.S. aid bill – Global Food Security Act or the Lugar-Casey Act – aims to direct more money toward GM research as part of U.S. foreign aid programs. What are the issues involved?

Hunger is on the rise, and it affects one-sixth of all of humanity, posing a serious risk for world peace and security. World leaders gathered in the Italian town of L’Aquila for the G8 summit last month reported an estimated 1.02 billion people in the world go hungry. They warned us of social unrest if global hunger is not arrested. Consider this information: between 2005 and 2008 food prices had increased by 83%. Though the crop prices dropped in the middle of 2008, the hunger crisis is far from over. What is the solution to hunger? The G8 solution is total, unfettered free trade. Seconding the absurd G8 logic is World Trade Organization (WTO). Their argument in support is that increased competition reduces prices and thus enhances the purchasing power of the consumers. Free trade helps transport food from places where it can be produced efficiently to where there is demand. Read more in Economics « Economic Debate No Hope for Fairness in The Job Market » But World hunger is not a simple crisis of demand and supply. The super powers use free trade clauses to discourage measures taken by developing countries to stabilize price — such as controlling import and export and using price control public distribution systems. The import bans by third world countries have a purpose: to protect the poor and vulnerable against the global agricultural price fluctuations by ensuring food availability below world prices before allowing exports to other countries. The reality is that free trade can distort market forces of demand and supply. G8 has purposely got the math all wrong. Free trade NOT= freedom from hunger. Fortunately for the developing countries, UN thinks otherwise. ‘World Economic and Social Survey 2008′ conducted by UN holds market liberalisation responsible for the food crisis. The advanced countries protect their farmers through subsidies, while simultaneously insisting the developing countries do not provide any subsidies to their farmers as it is against the free trade principles. The heavily subsidized agriculture has helped rich countries to capture third world markets and flood it with cheap, subsidized food. Poor farmers in developing countries for whom agriculture is the main occupation find subsistence farming unfavorable and financially unstable. The policies has converted developing countries that had once been self-sufficient, and even net exporters of agricultural products, into net importers and made them more vulnerable to high prices brought

on by the changing food supply policies of the exporting big bosses. Developing countries had, in the 1960s, an overall agricultural surplus of $7 billion, but by 1990s and 2000s they turned into net food importers. The reason people in countries classified as having “widespread lack of access” are unable to procure food is because they don’t have enough money to buy the expensive food. Freedom From Hunger through Technology? G8 would like to improve agricultural productivity through a technological agricultural revolution, more specifically, the fast-track adoption of genetically modified crops. A genetically modified organism (GMO) is one that has a foreign gene injected into its embryonic cells. Under the articles of agreement of WTO, the food giants have been granted unrestricted freedom to enter the seed markets of developing countries. The GM food have wide ranging implications for the farmer, the health concerns of the consumer and maintaining the rich biodiversity of the environment. Let’s consider a few of them: •

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The GMO technology threatens livelihoods of farmers and locks them into bio serfdom. The farmer cannot save the GMO seeds for subsequent replanting without paying royalties to Monsanto or other biotech giants he has bought the seeds from, though this was his traditional practice since thousands of years. And the GMO seeds are expensive. This has been made possible by the acquisition of exclusive “intellectual property rights” over native plant varieties and pirated centuries of farmers’ innovation in developing several varieties of rice, cotton, mustard, corn, and soy. To ensure that farmers have no option but to return to the seed companies year after year, biotechnology giants like Monsanto have developed ‘suicide seeds’ that produce sterile crops. The major agro biotech companies have also developed ‘traitor technology’, where seeds are engineered to produce negative traits unless treated with the company’s own chemicals.These are newer forms of colonialism that will convert an indigenous farmer into an industrial worker. The GM crops destroy the micro-organisms of the soil and the food chain that depend on it – weeds, insects, birds and other wildlife, and replace it with genetically uniform crops that are more susceptible to disease. They require the use of highly toxic ‘broad spectrum’ herbicides designed to wipe out all plants other than the crops that have been genetically engineered to tolerate the herbicide. Due to the threat of contamination, it is difficult for normal crops or organic crops to remain free from the impact of GM crops once these have been released. Secondary, unintended gene transfer can take place from GM pollens released into the environment. An example is the famous lawsuit Monsanto Vs Schmeiser: Classic David vs Goliath struggle There are evidences of the grave risks GM foods pose for human and animal health and for the environment, including creating new strains of antibiotic resistant bacteria, new viruses from those introduced into the transgenic plants, causing reactivation of dormant viruses and producing harmful effects including cancer.