Government-Induced Food Insecurity

Campus Report ^ | June 18, 2008 | Emily Miller

[bs9021]

Government-Induced Food Insecurity

by: Emily Miller, June 18, 2008

The recent food crisis and rising global food prices are short-term problems, said CATO Institute Research Fellow for India and Asia Swaminathan S. Anklesaria Aiyar last week.

“I firmly believe the current food crisis will soon blow over and we are going to be back very soon to the issues of overproduction through subsidies,” said Aiyar in a discussion about trade and food security at the Heritage Foundation. “I do believe that the current phase is a temporary one.”

Aiyar blamed export caps, which forty countries currently impose on grain, for driving up the prices of food by “artificially shrinking” the world trade market. He cited International Food Policy Research Institute statistics on rice in India to suggest global trading of rice has declined significantly.

“India used to provide almost one-fifth to one-sixth of the total rice trade, it exported 5.5 million tons of rice in 2007. Because of the crack-down, it will just be 1 to 2 million tons this year,” said Aiyar. “So three million tons are off the market from India alone and it’s like one-tenth of world trade has disappeared just because of India’s actions."

He added, “A relaxation of trade curbs can cut world prices by 30 percent and in the case of rice, I think it would cut world prices by more than 50 percent.”

Export caps are intended to “protect the domestic consumer,” yet Aiyar called it the “starve your neighbor policy” because rice is not able to leave India, thus leaving neighboring countries, like China, bereft of food imports they depend on...

[SunkenCiv]

Mexico freezes price of 150 food products
The Earth Times | 6/18/08 | DPA
Posted on 06/18/2008 12:03:39 PM PDT by bigcat32
http://www.freerepublic.com/focus/f-news/2032920/posts

[Paul Ross]

Cato the some bunch of trade dunder-heads who claim there is no inflation in food prices...