David Freddoso writing for National Review provides the reason for escalating food prices:
Why has the price of food followed the price of oil, upward and rapidly so? A small portion of that is transportation and farming, but most of it is due to the Energy Policy Act of 2005, which mandated that we use an incredible amount of the food we produce to create biofuels - for 4 billion gallons of ethanol in 2006, gradually increasing to 7.5 billion gallons by 2012. This year, it means that 28 percent of our grain crop will be used for energy and not eaten.
Read his compelling post here.
April 25, 2008 at 10:17 pm
Is the corn more important to power our vehicles, feed our cattle or use as food on our own tables?
April 26, 2008 at 3:58 pm
Actually the recent escalation in food prices is more complex than this indicates, although I applaud the idea that we need to abandon grain-based ethanol as a viable mass substitute for petroleum.
Some other contributing factors that are perhaps more heavily weighted in food price escalation include 1) the rise in petroleum prices as petroleum is both a currently utilized agricultural fuel and fertilizer input; 2) increased food transport costs as a result of 1) ; 3) broad increases in non-petroleum fertilizer prices (including, for example, potash, which lately has been rivalling gold in ROI); 4) ongoing increasing demand in population-heavy developing nations; 5) unsustainable agricultural practices in those very same countries (particularly India) ; 6) increased short-term speculative investment in food and agricultural input markets (which, as with housing, will prove extremely damaging) ; 7) decreased interest in sustainable agricultural careers/lives across the globe and a disturbing worldwide trend toward mass urbanization; 8) global increases in the pricing of risk owing to the housing/financial institution debacles of the last two years - which affects all agricultural enterprises that are in any way loan-dependent; and 9) increased misuse of agricultural lands as “lifestyle” and vacation properties.
Specifically in the US, three other contributing factors include 1) unsound “environmental” legislation and deeply misguided activism that reduce agricultural production area; 2) poor tax policies (especially the “death tax”) that disproportionately impact small to mid-size family-based agricultural producers with most assets tied up in production, thus forcing consolidation; and 3) forced dislocation of productive assets (including water and land) by government and big-business fiat (remember Kelo? ) to non-agricultural ends.
I believe strongly that ultimately any real solution will have to address the following - 1) changes in vehicle manufacture and use of carbon-fiber (or other alternative lightweight-material) components; 2) use of multiple types of alternative energies rather than a single-solution approach; 3) review and abandonment of much current so-called “environmental” legislation; 4) changes in urbanization and economic patterns to reflect truly sustainable practice and development; 5) abandonment of punitive taxes in certain necessary and productive industries; 6) imposition of sustainable population policies on certain nations that have not already addressed this problem (e.g. India); 7) recognition that irresponsible short-term speculation is potentially harmful to sectoral stewardship and maintenance; and 8) reinforcement of property rights.
April 26, 2008 at 4:03 pm
Sorry about all the “emoticons,” folks - they’re not intended by me at all. The “sunglasses” smiley-face should be a number eight followed by an end parenthesis. The “raised eyebrow” smiley-face that keeps cropping up in this and previous other posts of mine should be an end quotation mark followed by an end parenthesis.
April 26, 2008 at 5:46 pm
RA:
Excellent post. We have no idea why the inappropriate happy faces appeared in your well written comment. Every effort was made to remove them, but regrettably, they were determined not to budge. They seem to pop up inexplicably around parentheses–rather like mushrooms on dewy grass.
Your comments provide quite an education. We look forward to them with anticipation.
Our apologies.
Seeing Red AZ
April 26, 2008 at 5:56 pm
Thank you Seeing Red AZ- nice of you to say so.
The emoticons are produced by combinations of keystrokes - usually as you point out in conjunction with those parentheses. I guess if I remember to put in some extra spaces between the parentheses and other keys I should be alright.