There’s still plenty of angry commentary about last week’s global food summit from African op-ed writers:
The hottest debate surrounded the negative impact of bio-fuels of food crisis, its proponents, its producers, forging an otherwise unlikely partnership between the United States and Brazil, while its vehement opponents consisting largely of the third world countries who had a bone to pick with the big countries on many issues including unfair trade terms and agricultural subsidized by the western countries.
In a way, it was clear that in the final document the fierce debate around a policy statement on bio-fuels and trade which are solely responsible for watering down the importance of the summit were a clear indication of the side that walked away victorious. The summit declaration was coy on the subject of bio-fuels.
“We are convinced that in-depth studies are necessary to ensure that production and use of bio-fuels is sustainable.”
Ed Schafer, the American agriculture secretary said that increasing the production of corn ethanol is “the right policy direction”, no wonder Corn prices rose on the world markets throughout the last hours of the summit.
The upside could be the generous way in which countries pledged almost 3 US$ billion of emergency aid to provide food for populations that could not feed themselves, which in itself is a stop gap, a role the western world revels in, well knowing that it is no long time solution to the poverty in the third world.
Actually, I don’t know a single American who “revels” in donating aid to other countries. I think the general view on this side of the Atlantic is that little of our aid goes to helping needy people while the bulk goes to bolster elites who wile away their time making nasty remarks about us.
Is the purpose of the emergency assistance to solve poverty in the third world or, like good first aid, to staunch the bleeding before applying measures with a longer-term effect?
What sort of measures would provide a solution to poverty in the third world? I’m all for eliminating subsidies on biofuels here and in the EU but mostly because I think it’s bad policy. I think the evidence that subsidies on using corn in ethanol production produces hunger in Africa, Asia, and Latin America is actually pretty slim.
I think that the preponderance of the evidence at this point suggests that food prices (particularly the prices of rice and wheat) are rising because oil prices are rising and that oil prices are rising because production is flat while consumption continues to increase.
We’re actually consuming less oil in this country than we did a year ago and I expect our consumption to drop farther still. The best thing we can do in that regard is let is happen. The very worst thing we could do is the gas tax holiday that Sen. McCain is backing.
We could also produce more oil here. If we were to produce a significant amount of additional oil here from off-shore drilling, drilling in ANWR, or other measures, it would have the effect of lowering world oil prices which would, in turn, reduce food prices.
Meanwhile, both China and India are consuming more oil than they did a year ago. Both countries subsidize the price of oil, selling it to their people at prices below world prices, insulating them from price signals.
I’m for eliminating agricultural subsidies here and in the EU, generally, both because I think it’s bad policy and because I think it contributes to poverty in the third world but, as I’ve posted a number of times here, EU agricultural subsidies are relatively more important than ours in terms of their effects on Africa and Asia. I doubt that would do a great deal to improve things.
What would really help is greatly increased foreign investment and, money flowing as it does, the most important thing that impoverished countries can do is to create a business climate that encourages investment. That includes the tax environment, ability to transfer assets into and out of the countries, foreign ownership of assets including agricultural land, and greater transparency. That would discommode the very elites who are complaining that we aren’t doing enough. Must’nt have that.
The best things we’ve done to help alleviate poverty and suffering in the third world as far as direct aid goes are vaccination programs and clean water programs. Followed indirectly by genetically modifed food crops that produce more per acre.
Our own liberal elites are full of compassion for illegal immigrants, not so much for addressing the poverty and political dysfunctions that drive the illegal immigrant here in the first place. The best thing we can do to alleviate that is open trade.
We shouldn’t be subsidizing bio-fuels, we should be subsidizing bio-fuel RESEARCH. And we should be developing some the TRILLION barrels and barrel-equivalents of domestic reserves we have–the vast bulk of which Democrats in Congress have spent thirty years and more preventing us from developing. And that’s NOT including coal–we are th Saudi Arabia of coal. We should be building more nuclear power plants. Etc.
We do not have an energy crisis in America. We have a political crisis that prevents us from using the energy resources we already have in great abundance.
I couldn’t agree more, Tully. 40 years ago when the present environmental movement was just getting off the ground it was divided into two groups: the hard scientists and engineers and everybody else. I was part of the former group. The latter group successfully fought the construction of nuclear power plants and it’s their ideological descendants that form the bulk of today’s environmental movement.
When ever we (the hard scientists and engineers) asked them what they planned to do for energy in forty years they talked about conservation and the same alternatives they’re pitching now which still haven’t become economically feasible. Innumeracy has enormous advantages when you’re proposing solutions. You don’t have to worry if your plans add up.
There are simply too many people living on this planet to begin with, you can conserve and drill for all the energy possible…but the demand keeps growing because the population continues to expand. Solve over population,
and you’ll solve many other problems. In 2008 world population is around
6.7 billion, by 2045…9 billion..we’ll never end poverty or solve our energy problems with so many people.
The latter group successfully fought the construction of nuclear power plants and it’s their ideological descendants that form the bulk of today’s environmental movement.
I heard Steve Forbes make an interesting assertion a couple (or so) years ago. He claimed that if we had opened all of the nuclear power plants that were planned at the time of the Three Mile Island incident that we would currently be below the greenhouse emmisions goals set for the US in the Kyoto treaty. I haven’t been able to find anything to back that up, however. Perhaps you know something about this or your readers do.
Well, Outis, right off the top of my head what I do know is that more than 100 nuclear power plant projects were cancelled, roughly as many as are in operation now. Based on this info on power generation and this info on emissions, it looks to me as though it would have eliminated about 15% of our emissions of carbon dioxide and 20% of our emissions of sulfur dioxide.
That’s just based on the projects that were actually underway and nothing like as much as we estimated would be deployed by this point. The estimates I remember suggest several TW of generation—basically replacing all of the coal-burning plants.
The nuclear power plants fizzled not just because of environmental issues, but economics as well. The plans were started at a time of high expectations for a surging economy and increasing energy demand. They started building them at a time of high inflation in the construction industry and failed to contract in a way to protect themselves. And then the energy demand softened as the economy went into recession. The regulatory rewrites following 3 mile island hurt, but the projects were in a bad spot to begin with.
Dave, have you ever seen any figures on how much prices would drop if we drilled every drop of oil in the U.S. The estimates on ANWR at Wikipedia are that it could supply 5% of US consumption for 12-32 years. That doesn’t seem like it would make a noticeable dent in price, or am I wrong?
I worked in international economic development for a bit (including in Haiti). I’ve seen what can work, and what’s just throwaway feel-good aid. Our direct food aid generally does some good but we’re never credited for it, as it gets hijacked and relabelled as coming from the local power brokers, not from us. If they don’t just steal it and sell it, of course.
There’s other neat new tech beginning to come into play, but as I’ve just posted, it too will drive the “latter group” bonkers. Generally speaking, hard science is not the strong suit of pseudo-religious activists.
That doesn’t seem like it would make a noticeable dent in price, or am I wrong?
It would make quite a bit of price difference, though I don’t know that I’d buy into those figures given without mroe research. We have LOTS of oil. As in “enough known reserves to supply our current consumption for a century or more.”
Oil prices right now are in a classic price bubble, and clearly well into the inelastic range of demand-pricing, meaning that tiny shifts in supply can conceivably have outsized effects on price. As we’ve seen.
PD Shaw:
I’ve seen so many wildly varying estimates of what the impact of bringing new wells online would be that I don’t know what to make of them. IMO there’s a difference between small and none and we should be pursuing any avenue that makes economic sense rather than just looking for silver bullets.
No doubt that’s why local elites always are in favor of increased saleables from us. There is the flat in Paris to support, after all.
Well, of course. And those banks in the Caribbean have to keep up with the Swiss! Keeping up with the Joneses is tough all over these days.
Tully,
While I agree with you in general, it is not at all proven that genetically modified grains actually increase yield. For example. Given that, and the tremendous amount of resistance to them in actual third world countries, I think the claim that they are part of the answer to poverty is farfetched.
Good thing I didn’t make that claim, eh? Don’t overread what I actually said. I said they helped. They have. I’ve seen it.
I’m using “genetically modified” to include the old-school techniques of breeding superior strains including through gene marker tracing, not just the newfangled active splicing/modification of DNA. Not every strain will be a success nor will every succesful strain be suited for all conditions, but the development of superior strains of food crops in general has greatly increased yield over more than a century. And yes, that includes DNA-spliced crops.
Not all GM is done for yield increase. In some cases the focus of modification isn’t yield at all, but reduction of pesticide use or boosting of nutrient content, and using a yield metric there is completely off the point.