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Hi, Tomasz Wroblewski here, and this is Liberty Under Renovation. Russia does not negotiate, does not seek rational terms of peace, Russia wages a war of attrition, which of course it will not win unless it first divides the world or plunges it into chaos. Hence the blackmail of energy restrictions and now the threat of a food blockade.
The vision of global famine seems terrifying today, but but historically this is how our Western democratic order has forged itself. Russia and Ukraine together send 12 percent of all calories traded to the world, which has now shrunk sharply to 1 percent. Ukraine alone provided enough calories to feed 400 million people.
Reducing the supply by even 10 percent of calories globally, could raise average food prices by 40 percent. Already for wheat, the price has increased by 58 percent. The list is long - the world faces a 75 percent reduction in sunflower oil supplies, 29 percent less barley, 15 percent less corn. Taking the World Bank's calculations, this year, more than 1.5 billion people will not be able to afford a full-calorie diet, and nearly 250 million people will be on the brink of starvation.
Add to that the fact that a third of the world's potash consumption has been blocked by sanctions in Russia and Belarus, and you have a picture of a full-scale agricultural disaster. And we can go on like this, following the whim of numbers, establishing these worst-case scenarios, imagining what the first plague of famine in this century might look like. And we can look at it from the perspective of geopolitical regularities, kind of a cyclical alternation of hunger and abundance, and consequently population declines and increases, which, as Alex de Waal writes, coincide with wars, revolutions, economic booms, and alternate with the darkest pages of history. Waal writes: "Hunger, is a perpetual race between a growing population, technology, and changing food habits." If anyone still remembers Leo Tolstoy's "Anna Karenina," the first sentence was: "All happy families are alike; every unhappy family is unhappy in its own way." We can say the same thing about hunger today, that all full people are alike, but each starves in his own way.
That tells us only that the concept of hunger is slowly changing and, most importantly, its political meaning is also changing. The last half century has allowed us to basically forget about hunger or even malnutrition. Increased wealth, new technologies, fertilizers, GMOs, trade liberalization have all combined to make food prices in relation to wealth the lowest in human history.
Just recently, I recall that the United Nations predicted that hunger would be completely gone by 2030. And for good measure, already in 2018, where there were no wars or revolutions, people were no longer starving to death, although the UN reminds us that 630 million people, still don't get enough nutrition. This is quite a lot, but it is still 23 percent less than in the 1990s, and of course this is with an ever growing population - we now have almost 8 billion people, most of whom live in countries that until recently were still struggling with hunger. Threats, if they arise, are usually where the market balance is disturbed. The aforementioned wars like the one plundering Ukraine, pestilences like COVID, which strained supply chains and caused an additional 161 million people to fall into poverty, but also threats like trade barriers, protectionism, human thoughtlessness, or, as European Commission Vice President Margaret Vestager aptly noted when she said, "Europe wasn't naive, we were just greedy." Greedy or careless, which is no less glaring in the case of food than it is in the case of gas supply.
We'll start, however, by saying that, at least arithmetically, there's no reason why the war in Ukraine and the halted food supplies have to cause a hunger crisis. The world produces far more food than it needs. Counting caloric values, there would be enough food to feed 12 billion people. 12, not almost 8. As a rule, the market is well balanced, balancing the need and the supply of food, which grows in proportion to the demand, and wherever there is a shortage, someone immediately replenishes it.
Rather, the point is that we are consuming more and more, and not just because there are more of us, but also because we are eating more and much healthier. The human diet has changed dramatically in the last 100 or even 50 years. We eat healthier and more varied food, which makes our lives more enjoyable and also longer. You can see it in all the demographic charts. But further perusing the UN data, we will see that our problem is not hunger, but gluttony, for while 1 in 10 people suffer from malnutrition, 4 in 10 suffer from diseases resulting from being overweight.
Obesity rates have tripled since 1975. Nearly 2 billion adults today are overweight, which on the one hand is the result of low food prices, with which we simply compensate for some of life's other shortcomings, and on the other hand, that this cheap food is often of poor, average quality, which tells us that we don't so much need more food as more cheap and higher quality food. This can only be achieved by improving the efficiency of markets, facilitating access to agricultural land, or the wider adoption of GMO technology, which is being displaced with a fervor that is hard to understand by idealistic environmentalist agendas.
For example, the infamous EU program "Farm to Plate", or in literal terms, "Farm to Fork". A catchy name, but it's just an attempt to ideologize another area of our lives. The vision, from elsewhere, is spread by our Polish commissioner in the EU, who at various meetings tells such stories about returning to small, family-run, self-sufficient farms focused on healthy food. Chicken, there a pig, a cow, there a field. It sounds nice, but it won't solve nutritional problems.
The problem is not just in quality, but also in price. On average, organic food is 50 percent more expensive than conventional food, reflecting higher production, processing, and distribution costs. In theory, the margin is also higher and here the proposers are also right, the only problem is that hardly anyone can afford to buy such food.
And then there's the issue of yield per hectare of organic crops, which is 25 percent lower on average. But the persuasive power of the environmental community here is enormous, and it's hard to break through with rational arguments. Already today, 45 percent of Germans and 40 percent of French believe that organic farming can help fighting hunger.
In 15 years, the world's organic crop area has grown from 15 million hectares to 51 million. According to a study by scholars at the University of Göttingen, to feed 8 billion people with organic food alone, we would need, hear this, 78 percent more agricultural land. Which, in a situation where some 6 percent of the world's acreage may now be taken out of agricultural production, does not seem reasonable. But as we know, bad ideas die the slowest death.
Environmentalists respond to this argument by simply stopping wasting food. And always open to progressive ideas, the United Nations and its food agency FAO appeals for saving: "Save Food!" "At a time when nearly a billion people are suffering from hunger". - you know it without reading. Every time there is a news story about the number of malnourished in the world, we have a food appeal to eat less, buy less, everything in moderation, because children in Africa... Several countries, led by France, have even enacted anti-waste laws.
I don't know if that's what it's called. Stores that do not have or do not follow the rules for dealing with out-of-date food pay fines of up to €75,000 and in extreme cases the owner can even go to jail. The law went into effect in 2016, and since then the amount of food in French stores, across all categories, has increased, with the fastest growth among the most perishable products like vegetables, meat by an average of 70 percent. A group of U.S. and European agricultural economists say that's not how to deal with this. They suggest not talking about waste in general, but rather food that has no productive use.
This is perfectly explained by Nick Cullather in his book "The Hungry World". Back in the late 19th century, he writes, most of the food people ate came from local markets. It was locally sourced and less of it was wasted.
The introduction of the calorie concept, i.e. the calorie as a measure of nutrition, meant that food could now be separated from local customs and tastes, and defined in terms of calories per capita. Dietary policies based on calculating an adequate supply of calories relative to price have completely changed eating habits around the world. They started importing nutrient-rich raw materials, products, plants, meat from all over the world. This means that more food is wasted traveling from one continent to another, although the calorie balance is still better today in relation to cost than at any time in world history.
What is worth remembering is that the increasing richness of our diet is not a symptom of the decadence and debauchery of rich nations, but on the contrary a more efficient way of utilizing the caloric potential of various agricultural products and making better use of the world's arable land. Is it worth giving that up for the sake of some ideological concoctions? Question. The paradox is that the closer we get to zero waste, the more expensive food will become. Marc Bellmare, a food economist, writes: "It is especially important to understand that 'saving,' that the war on hunger or malnutrition will not be won by reducing waste."
And I go back to the economists' report mentioned before: "Food," we read in report, "is also wasted due to increasingly stringent shelf-life standards, which is further exacerbated when food is highly processed". Add to that our new passion - healthy eating - that everything has to be fresh, right now, and preferably delivered to your door. And yet another not very well publicized dependence: proportionally most food is wasted in various charity and aid actions. These large supplies of grain, flour and finished products for starving children are usually transported through dozens of ports, often by ships of inferior quality, hand-carried, often using primitive methods, stolen, and sometimes rotting in poorly managed warehouses. We know that in principle the commercial networks will have better logistics, they are constantly working to reduce their losses, and it seems logical that no one cares as much about the paid ones as free ones, but somehow no one is also calling for a reduction in free aid, which, as we are about to see, would by all means be useful.
It would help solve another problem of today's agriculture. Namely, we actually have more and more food, but mainly due to better production technologies, productivity is getting better. Meanwhile, as John Perkins notes in his book "Geopolitics and the Green Revolution", so far the acreage of farmland, over the last 40 years, has increased by only 30 percent, meaning we have more food from little more farmland. One of the reasons why large tracts of land in poor countries, in fact the poorest countries, lie fallow, particularly in North Africa, South Africa and even India, is that they are in the hands of local clans, which often redistribute these gifts of free grain and free food.
They then use the profits from charity to buy more and more land, which they then leave fallow to get more and more charity. Over the past 50 years, the West has spent $2.5 trillion to help Africa, and a UN report shows that the food situation is getting worse, not better. The more aid there is, the worse the food situation is.
Compared to 2017, the number of malnourished people increased by 20 percent. Dambisa Moyo in his acclaimed book "Dead Aid" shows that money is increasingly going into the hands of corrupt officials instead of to those in need. They become weapons in the hands of gangs who treat food a bit like a tool to buy influence and that aforementioned land.
The best evidence is that the entire African continent has more than 65 percent of all the world's unploughed land, all the land that lies fallow. A total of some 600 million hectares of land. And yet, the African Development Bank Group estimates that these food imports will have to continue to grow, as far as Africa is concerned, and will probably increase from $35 billion in value in 2015 to over $110 billion in 2025, with, of course, and the same report shows this, the number of poeple suffering from hunger in Africa is expected to increase by 33 percent. Africa is not held hostage to war in Ukraine or food waste. Africa is hostage to domestic oligarchs and protectionism. The threat of famine I think is genuine, but in the long run it should be an opportunity to fix this broken system rather than dismantle what is already working.
Recent history since the Industrial Revolution gives us quite a few hints about how the mechanisms of food policy work and where these mistakes lead in the end. Between 1760 and 1840, the rise of industrial production led to a huge increase in global capacity and productivity. Robert Allen, in "The British industrial Revolution in Global Perspective", wrote that "The political consequences of technological change have been transformational. Social consciousness expanded from the village to the nation."
A new model of nation-state emerged, which instead of birth rewarded intellectual qualities and diligence, and of course needed its own religion, its own morality. And so, following the example of the Dutch and British Puritans, a new model for the realization of human dreams was created out of the work ethic, but it also created a new way of defining national geopolitical goals and the necessary expansion of nation-states to do so. The market hunger in Europe led to the Opium Wars in China and eventually to the fall of the Qing Dynasty and the opening of all of China to Europe. Britain conquered the Mogul Empire and laid the foundations of modern India, and the Americans drove the British, then the French, out of America.
And so these former vast, multi-ethnic empires were replaced one by one by unified nation-states. That's so history in a nutshell, but all I'm saying is that the Industrial Revolution would not have been possible if not for an increased supply of labor hands concentrated in ever larger cities, in turn cities and populations would not have grown if not for increasing agricultural production and access to food, and all of this would not have happened if not for the rural revolution in the 16th century. The revolution caused by the plague of the 15th century, which caused a process of land concentration and later forced a new, more efficient agricultural production.
When they were able to increase production per hectare, the population began to recover again, and the overproduction of young people had to seek work outside the village, off the farm. And so they settled cities, took jobs in factories, services or wherever else. The revolution in agriculture, like any revolution, was obviously not the result of a single phenomenon. It was a process. A process that went back to the 15th century,
the marshy polders of Holland, where, to provide basic sustenance for the growing ports on the outskirts of Amsterdam and Rotterdam, vegetables began to be grown. This was to supplement grain supplies from Poland. Difficult, challenging agricultural conditions forced the Dutch to look for new tools and farming methods.
In time, they were adopted by the British, who were also looking for a way to feed the growing city of London. And so the Dutch perfected the plow, John Locke created the legal framework for the agro-industrial revolution, in his Treatises on Government he justified property rights by divine right. "The right to life, liberty and property was provided by the exclusive ownership of land" - this is what John Scott writes in his book "How the Old World Ended".
He writes about how this allowed for the creation of free trade in agricultural products. How rising profits from agricultural production encouraged experimentation and investment in new technologies and widespread use of fertilizers - mainly phosphates and nitrates, as we now talk about a lot in the case of Ukraine and Belarus. The availability of food has caused the population to grow rapidly. In 1700 there were about 6 million people living in Britain - by 1900 that number had grown to, mind you, 37 million. The eternal self-perpetuating food spiral that influences the course of history, subsequent revolutions and political transformations.
In Genesis, Joseph, as we remember, sits in a prison cell until he is summoned by Pharaoh to interpret a disturbing dream. Joseph explains to Pharaoh that the dream means that Egypt will experience 7 years of plentfulness followed by 7 years of famine. Pharaoh listens to him and appoints Joseph to oversee the ban on exporting Egypt's grain, sending it outside so that one-fifth of the food harvested during the 7 years of plenty is preserved for the 7 years of famine. Joseph turns out to be right - he manages Egypt's agricultural sector and does so well that the Israelite population in Egypt grows rapidly.
Eventually a new Pharaoh appears in Egypt and this one becomes afraid of the number of Israelites around him and decides to enslave them and drown the firstborn boys. Fast-forward about 3,000 years and on the wave of the book "The Population Bomb" that was fashionable in the 1960s, by Paul Ehrlich, academia declares a state of emergency for planet earth. Ehrlich argued by simple extrapolation that population growth inevitably leads to planetary annihilation. Lack of water, minerals and scarcity of food, were to bring disaster to mankind. As Ehrlich wrote, "In the 1970s, the world will experience famine - hundreds of millions of people will starve to death."
He argued that either we stop the mad rush to get rich or we all die. If we don't dry up from lack of water, we will die from starvation wars. A year after Ehrlich's publication, and some 170 years after an essay by Thomas Malthus that unleashed a similar panic on the eve of the Industrial-Agricultural Revolution, a club of scholars formed in Rome who were concerned about overpopulation. The Club of Rome in 1972 issued a document entitled "The Limits to Growth". The authors called for limiting population growth and economic growth, which in turn fueled reproduction. "Each day of population growth brings the world closer to the limits of our prosperity," they wrote in the report.
States were now to regulate the right to procreate and international organizations were to set demographic limits for governments. Well, today we know that the thesis of impending doom was absurd. Darrell Bricker and John Ibbitson in an excellent, very interesting book, "Empty Planet", write in detail how scientific discoveries, the green revolution, improvements in hygiene conditions, but also medical advances and above all new farming techniques with new varieties of grains, corn, meant that the world was easily able to feed the growing populations of Asia and Africa. The planet was saved, but it was saved by market mechanisms that allowed for lower agricultural production costs through the mass availability of farm machinery, fertilizers, and better distribution of crops.
The free market, not social engineering, helped defeat hunger. Incidentally, the idea of the Club of Rome was largely adapted by the Chinese Communist Party in 1979. As we recall, China has banned having more than one child.
The consequences are the cause of the demographic disaster China finds itself in today. Food and agricultural production were also the mother of the Western geopolitical order. When World War I broke out Europe, like today, was gripped by panic. Fear of food shortages was the number one topic in all European newspapers, accompanied by a massive government campaign.
One of the first things the United States did after entering the war in 1917 was to create a national food authority and it was headed by none other than Herbert Hoover. As Tanfer Tunç writes: "While European governments viewed food primarily in terms of domestic order, Hoover understood that U.S. agricultural production was critical to building U.S. war strategy and to ensuring security after the war." Hoover saw food as a potential weakness, but also as a potential tool for building American power. Truman's strategy worked, Truman, among other things, won the election, became president, but the food was coming in all too fast, too fast and too much. The market has not been able to consume it all, causing prices to fall.
The power of American agriculture was growing and the United States in general was growing, but ironically, U.S. success was driving American farmers out of business. In the mid-1930s, the U.S. government got to work, bought up and literally shot 470,000 cows. He hoped that this way prices would not fall further.
Britain was doing the same thing with pigs. In Brazil, coffee was burned. In Argentina, France and Canada, grain was left in the fields to simply rot. And then, out of the blue, in 1936, a League of Nations report came up with the idea that it was a human right from now on to consume 2500 calories a day.
And so governments were required to purchase an average of 2,500 calories per day for every hungry person in the country. The problem eventually solved itself, thanks to Asian markets that began to absorb these surplus grains. But what is important about this story is that the fight against hunger was not born out of hunger, but out of excess food, and not out of concern for the poor, but out of concern for the producers.
The importance of food later increased again during the Cold War. Harry Truman, in '49, included food aid specifically in his list of foundations of American advantage in competing with communism. "Protecting supply markets became one of the main spaces of ideological clashes of the Cold War, in the rice fields of Southeast Asia, in the tropics of Brazil. Rural poverty was seen as a critical weakness in the world in the face of communist pressures, and development became a staple weapon in the fight against the Cold War." wrote Cynthia Truman (the coincidence of names is accidental).
In 1991, as we recall, the Soviet Union fell, global agricultural trade then began to flourish, transportation became cheap, low tariffs allowed exporters to flood the world with cheap food. And further we remember - the hunger began to disappear. One hundred years of geopolitical rivalry can be described by a food cycle. And today the natural field of this cycle, this struggle in the clash for a new order, is the blacklands of Ukraine and the steppes of Russia.
First, the sudden increase in agricultural production in that part of the world caused a sudden drop in food prices, and naturally resulted, as usual, in even more supplies of free food to Africa, and all sorts of idealistic concepts, such as the concept of organic foods, which are a bit like rotting grain in Canadian fields, meant to help producers raise food prices. We are back to where we were 100 years ago. Again, the world must find a new food mechanism, a geopolitical mechanism, to restore the food balance.
It could, of course, be the end of war, that's the simplest solution, but it could also be an opportunity to dispel utopian visions of mass organic food or to rebuild the balance of power in the world. U.S. General Jack Kean suggests organizing an international food and merchant escort that, led by U.S. mine-laying ships, would be a fleet of a several countries, enter the Black Sea and escort a convoy of grain ships. We remember that the United States has engaged in similar operations twice before. In 1984, the U.S. protected Kuwaiti oil tankers in the Persian Gulf.
In 2019, they protected tankers passing through the Strait of Hormuz. But now the world is in a slightly different place, and the question is whether such a deal can be negotiated with Turkey, which controls access to the Black Sea. In any case, today the agricultural revolution and the Black Sea invasion may seem a bit breakneck, but as history shows, food has controlled human passions for centuries, and it determines new geopolitical orders. Tune in next week for another episode of Liberty Under Renovation on the Warsaw Enterprise Institute's YouTube channel and on Spotify and Itunes podcasts. [Music]
2022-06-05 04:15
