Thursday, March 18, 2004
More on Effect of China's Growth on Everything Else
In his NEW BLOG Jorge Ortiz astutely observes:
. . . I would not worry so much about the U.S. consumers having to pay more for their food to compete with emerging Chinese consumers.:-)
What worries me are countless other poor countries who rely on food imports from the U.S. and Europe to feed their people and will find it imposible to do so at prices that could suddenly go to the roof while their internal agricultural production is broken -courtesy of developed world farm subsidies-.
The World Trade Organization says that the U.S., Europe, and other industralized nations spend 300 billion annually on internal farm subsidies, this encourages surplus production in those countries, where farm subsidies represent 31% of farm income. The surplus production from developed countries is then dumped to the rest of the world at prices that are inferior to production costs, thus discouraging poor countries and other nations from producing their own food, with low world prices gradually destroying their internal agricultural infrastructures, forcing those poor countries to rely even more on exports from develop nations.
When we add the ingredients of markets distorted/broken by subsidies and a sudden demand from China, we have a time bomb ticking, and it is the poor who will starve, not the chinese, the europeans or the americans.
The hand that feeds you may end up killing you.... “Et tu, Brute?”
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