Monday, June 2, 2008

How To Deal With Food Shortages

Man can put a man on the moon, and develop a bewildering array of new technology. Yet, for all our material advancements and success, the twentieth century has left us with the seemingly intractable, yet fundamental, problems of people around the world struggling to get enough food to eat. This problem of malnutrition and insufficient food supplies has been magnified by the sharp rise in food prices which are causing real hardship for those on the poverty line.

What are the Solutions to Food Shortages?

Market incentives.

In theory rising prices should encourage the production of food crops. Sometimes it is government intervention that prevents market signals working effectively. For example, maximum food prices, may seem to make sense in the short run. But, by keeping prices artificially low you prevent the inventive to increase supply and deal with the long term problem. Governments should allow prices to rise to market levels. If necessary they should increase the incomes of the poor so that they can buy food. But, this is much better than keeping incomes and prices low.

End Government Subsidies of Food for Bio Fuels.

Recent years have seen a huge expansion in crops grown for the purpose of bio fuels and not food. Governments are rightly concerned about oil supplies and so they feel bio fuels are an alternative. Therefore, bio fuels have been heavily subsidised encouraging farmers to grow crops for fuel rather than food. The effect of this is that food prices have risen since effectively there is lower supply of food crops. Bio fuels also hurt developing countries the most. It is the west who is concerned about alternative energy supplies; the West doesn't really mind food inflation that much; but, for developing countries food inflation is devastating.
This does not mean the governments should not promote alternative fuel supplies; it just means they should promote alternatives which don't disrupt food supplies.

Efficiency of Existing Farming.

In the developed world farming productivity is much higher thanks to technology such as chemicals and fertilisers. There is scope for increasing the productivity of land in developing countries. This may require government intervention such as improved infrastructure and education about the correct use of fertilisers. There are also difficulties; greater productivity often requires economies of scale. Merging small farms into bigger ones is not straightforward; one thinks of China's disastrous leap forward.

Genetically Modified Crops.

To some GMO crops is a dirty word conjuring images of Frankenstein food and runaway supercrops. However, for those in developing countries, the pressing issues is lack of food. When you are starving ideological opposition to GM crops is likely to fade away. If it can provide real solutions, at least it should not be dismissed out of hand.

The real economic crisis - food

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