Love for Life

GLOBALISATION - A DISASTER FOR ALL HUMANITY
From The Epoch Times Jun 24, 2008
By Richard Hill & Nick Rose

For years it's been said that globalization has a so-called dark underbelly. It has, but the question now is whether the rest of it is in any better shape.

There are no clearer signs of the terminal moral, social, and economic bankruptcy of the globalized "free market" than the unfolding global credit and food crises. Both are the product of a systemic financial logic that rewards unconstrained speculation, irrespective of the social costs.

Most of the world now faces a prolonged recession with all its associated hardships, beginning with increasing unemployment, falling house prices, and mortgage foreclosures.

The credit crisis has been brought about in large measure by the predatory and fraudulent lending practices of mortgage brokers in the United States, who in turn have been egged on by the financial whiz-kids of the major banks and investment firms, all eager to get their share of the multimillion-dollar bonuses from the real estate bubble.

The collapse of the sub-prime market in the United States along with the demise of several U.S. and British financial institutions are threatening a return to 1970s-style "stagflation," and some commentators even draw parallels with the Great Depression of the 1930s.

While multibillion-dollar rescue packages are mounted with dizzying speed for investment banks such as Bear Stearns, those on the lower rungs of the socioeconomic ladder are told to "tighten their belts" and reduce their expectations.

Equally, the commodification of food—that is, its trading as a means of generating profits rather than an end in itself—means that it too has been the subject of futures speculation, which helped produce fabulous earnings for hedge fund managers like John Paulson and George Soros, who pocketed US$3.7 billion and US$2.9 billion respectively in 2007 from speculation on the global credit and commodities markets.

Of course many other factors are involved in this escalating "food crisis": drought and floods, increased demand for meat from China and India, exponential oil price rises leading to higher costs of chemical inputs and transport, and the diversion of vast grain acreages into feedstock for biofuels.

Despite all the posturing of Western governments, international financial institutions, and the odd rock star, it is the world's poor who continue to bear the brunt of the food crises.
While people in the West face the prospect of limits being imposed on their rice purchases (as has already occurred in the United States and Britain), those in poorer nations face a far more grim reality: starvation.

Despite all the posturing of Western governments, international financial institutions, and the odd rock star, it is the world's poor who continue to bear the brunt of the food crises.

In the very short term, the U.N.'s World Food Program estimates that as a result of sky-rocketing grain prices, more than 100 million people face the prospect of hunger and extreme poverty in addition to the 860 million who already go to bed each night undernourished.

The bottom line, however, is that there is enough food in the world to feed everyone; the total grain production for 2007 of 2.3 billion tons is actually a 4 percent increase on 2006. At stake here is the equity of food distribution and how the financial markets operate to price basic grains beyond the reach of the most vulnerable billion people in the world, most of whom are already food insecure.

This issue is hardly new. As for food equity, campaigners have argued that food insecurity is the result of decades of economic and trade liberalization policies imposed by the industrialized world, its banks and its global governance institutions.

These policies were always cynically hypocritical since the United States and the European Union continued to hand out multibillion-dollar subsidies to their own farmers, allowing them to destroy the grain producing capacities of developing nations through the dumping of cheap exports.

Dozens of poorer countries like Haiti, Sierra Leone, and the Philippines lost the capacity to feed themselves through the combined effects of such practices, together with "conditionalities" attached to IMF loans that forced them to remove all tariffs. Now their impoverished populations are desperate, angry, and rioting.

The very least we can now expect from our governments and members of the super-rich club is that they act decisively to provide sufficient food aid to avoid a looming global famine, without attaching the usual strings of liberalization.

However, this can only be the bare minimum that decency demands. A fundamental issue is whether basic grains—the very source of sustenance for millions of people—can continue to be regarded as any other commodity; whether billionaires can continue to enrich themselves by condemning millions to eat, quite literally, dirt as is now occurring in Haiti's slums.

The stability of any system that produces such obscenities is in serious doubt, for two principal reasons. In the first place, these inequities are stripping globalized capitalism of its remaining popular legitimacy and prospects of survival.

Second, the global economy's fragile dependency on endless supplies of cheap energy inputs is rapidly confronting the hard reality of the world's geological limits. The price of a barrel of oil has risen 40 percent since the start of the year, and 400 percent since 2003.

As we saw in the 1970s, the global economy cannot withstand that sort of energy inflation. This is a major reason why those ahead of the curve on sustainability are putting their energies into community gardens and local food systems.

Richard Hill is Senior Lecturer in the School of Arts and Social Sciences at Southern Cross University, New South Wales.

forwarded by Bob Vinnicombe
Publicity Officer
One Nation (NSW Division)

Link to this article: http://en.epochtimes.com/news/8-6-24/72347.html