London — I feel a little sorry for U.S. President George W. Bush. Whatever his other many failings, he has a pretty good record on aid to poor countries, particularly in health care. True to form, he recently announced a big increase in U.S. food aid good for the hungry poor and good for American farmers.
It was a faster response than some other countries have made to the global food crisis. After falling for more than 30 years, food prices have recently soared.
The Economist’s food price index has risen to its highest level since it started in 1845. As has happened throughout history, rocketing prices and shortages have caused riots from Bangladesh to Bolivia. The word for bread in Egypt is aish, which also means life. Threats to life bring crowds onto the streets.
What made me feel a little sorry for Bush was the reaction to his announcement. Bush referred to the reasons for shortages and price hikes. He did not dwell on the diversion of American corn from food to heavily subsidized biofuels. Nor did climate change feature prominently in his argument, although many experts suggest that this may be the cause of the droughts and floods that have ruined wheat harvests in Australia and vegetable oil production in Indonesia and Malaysia.
Bush pointed his finger primarily elsewhere. Food prices had responded to growing demand. In Asia, economic growth had stimulated food consumption. The Chinese and Indians were eating more and eating better. Over a 20-year period, for example, the Chinese had doubled the amount of meat they eat.
What Bush said is of course true. But it is only part of the truth. Globalization has benefited India and China, and the rest of us, too. A key reason for the world’s economic growth from 2000 to 2007, despite wars and terrorist atrocities, is that India and China joined the world economy. Hundreds of millions of people were lifted out of poverty.
But too many Indians are still wretchedly poor. They have a miserable diet not least when compared with Bush’s Texan neighbors. Grain consumption per head in India has remained static, and is less than one-fifth the figure for the United States, where it has been rising. I do not imagine you will find too many vegetarians in Crawford, Texas, and the meat consumed by the average American is way ahead of the figure for any other country. Think of all those T-bone steaks.
Bush’s partial explanation of the world food crisis, accurate as far as it went, drew anger from India’s media and many politicians. According to Indian Defense Minister A.K. Anthony, presumably an expert on butter as well as guns, Bush’s statement was “a cruel joke.” Though urged by the parliamentary opposition to join in the populist America-bashing, Prime Minister Manmohan Singh wisely kept his head down.
Later in the week, Bush’s White House compounded the sin. According to Bush’s press spokesman, the growth in world demand for oil in Asia, for example was one of the causes of the high price of filling the tanks of gas-guzzling sports utility vehicles as well as more modest family cars, at America’s pumps.
Meanwhile, the U.S. government papered over the fact that Americans, who make up less than 4 percent of the world’s population, own and drive 250 million of the world’s 520 million cars. More outrage around the world at American double standards.
All this is more than the knock-about of international politics. One day soon, Bush and Vice President Dick Cheney will be out of office. But we will still be left with the most difficult global issue we have ever faced: As more of us prosper, how do we deal fairly with some of the economic and environmental consequences? What do we do about the bottom billion in the world who remain in grinding poverty while the rest of us live better and longer lives? How do we deal with equity on a global scale when we cannot even deal with it country by country?
This conundrum will lie at the heart of the diplomacy next year to find a successor to the Kyoto Protocol. Can we prevent a calamitous increase in global warming in a way that takes account of past and present responsibility, and does not thwart legitimate hopes for a better life everywhere?
Meanwhile, there is a food crisis to solve. We have already seen many examples of how not to deal with it. Stopping food exports is stupid. If we restrict market forces, there will be less food and higher prices. We should also avoid the cheap political trick of holding down what we pay poor farmers in order to benefit poor city dwellers.
Why do governments do this? The answer is obvious: city dwellers riot; in the countryside, people just starve. The best way to deal with the problem is to subsidize food for the poor; we should not cut the price we pay farmers for growing it.
Having enjoyed a few days of Bush-bashing, India got on with the job of bowing to pre-election political pressures. The government announced that it was suspending trading in futures markets for a number of farm products.
India has the most economically literate triumvirate of politicians in the world in charge of its economy. They must know that this measure will have as much effect on food inflation as rain dances have on the weather. But politics, alas, is politics.
Lord Patten is a former governor of Hong Kong and European commissioner for external affairs. He is currently chancellor of Oxford University and co-chair of the International Crisis Group. © 2008 Project Syndicate (www.project-syndicate.org)