Let Them Eat Ethanol!

Wall Street millionaires have spent months mourning their losses from once ridiculously over-valued investments. Yet these same free market cheerleaders remain blissfully unaware of the magnitude of the crisis facing the real victims of the unfolding global meltdown they so enthusiastically enabled.

For the three billion people who survive on less than two dollars a day, the upward spiral in global food prices has meant a struggle for the most basic of human rights—the right to eat. Rice, bread and tortillas are the staple food for this half of the world’s population. In 2007, the price of grain rose by 42 per cent, and dairy products by 80 per cent, according to UN figures, and food inflation has accelerated further in recent months.

As the Observer noted on April 6, “A global rice shortage that has seen prices of one of the world’s most important staple foods increase by 50 per cent in the past two weeks alone is triggering an international crisis.” In recent weeks, mass hunger has spawned violent rioting in Burkina Faso, Cameroon, Egypt, Indonesia, Ivory Coast, Mauritania, Mozambique, Senegal and Haiti.

Six straight days of rioting rocked Haiti this past week. Haiti is the poorest nation in the Western hemisphere, where 80 percent of the population lives on less than $2 per day and the typical adult diet consists of just 1,640 calories—640 calories less than the average adult requirement—according to the World Food Program. Haitians have grown tired of subsisting on what has become the common diet: clay, salt and vegetable shortening. “Protesters compared the burning hunger in their stomachs to bleach or battery acid,” noted the Guardian on April 9.

On April 4, thousands of angry Haitians protested in the southern city of Les Cayes, attempting to set the UN police base on fire while stealing rice from trucks. The rioting soon spread to Haiti’s capital, Port-au-Prince, where thousands stormed the presidential palace demanding the resignation of the U.S.’ hand picked president, Rene Preval. Fortunately for Preval, UN “peacekeepers” eventually managed to disburse the starving masses with tear gas and rubber bullets. Their brutal suppression perhaps prevented Preval from meeting the same fate as Jean-Claude “Baby Doc” Duvalier, the U.S.-backed dictator overthrown by a popular rebellion in 1986.

Preval has done nothing to stabilize skyrocketing food prices or to assist those on the brink of starvation—and he made clear in a televised speech on April 9 that he has no intention of doing so now. In a Marie Antoinette moment, Preval scolded Haitian citizens, “The demonstrations and destruction won’t make the prices go down or resolve the country’s problems. On the contrary, this can make the misery grow and prevent investment in the country.”

***

In Egypt, where protests and strikes are illegal, thousands of textile workers and supporters in Mahalla el-Kobra rioted against high food prices and low wages on April 6 and 7. Police occupied the state-owned Misr Spinning and Weaving plant overnight to prevent workers from going on strike as they had planned, but protesters responded by setting buildings on fire and throwing bricks at police tear-gassing them. Police repression did not succeed in frightening these protesters but rather only further fueled their anger.

Roughly forty percent of Egyptians survive on less than $2 per day, while the price of unsubsidized bread rose by 10 times in recent months and the cost of rice doubled in a single week. The national minimum wage has remained unchanged since 1984, at 115 Egyptian pounds per month. The Mahallah workers have called for a national minimum wage of 1,200 pounds per month—which would still leave a family of four living under the poverty level of $2 per day.

This week’s rioting in Mahalla is the latest episode in the rising class struggle now reaching deep inside Egypt’s working class. Middle East Report editor Joel Beinin argued of the growing strike movement, “This is potentially the broadest-based gathering of dissent the Mubarak regime has ever faced. The combination of repression, apathy and political demobilization that has sustained autocracy in Egypt for over half a century is being forcefully challenged, making it increasingly difficult for the Mubarak regime, if not its capitalist cronies, to conduct business as usual.” Indeed, Prime Minister Ahmed Nazif rushed to Mahallah on April 8 to announce he is granting the workers a 30-day salary bonus and will address their demands on healthcare and wages.

***

Hunger is also rising in the U.S. The unregulated greed unleashed over thirty years of neoliberalism that wreaked havoc on the world’s poorest countries is now exposing the class divide in the world’s richest. It can no longer be claimed that all of those residing in the global North gain prosperity at the expense of the global South.

To be sure, growing hunger in America has only earned passing reference from U.S. media outlets, which still largely take their cue from Wall St. and the White House. On April 7, for example, Tribune Newspapers preposterously featured an article on the plight of that tiny slice of Americans now curbing their exorbitant spending habits. The article feature a down-on-her-luck mortgage broker forced to forego the Botox treatments for which she once regularly dropped $1,800. “I would rather have Botox than go out to dinner,” the woman told reporters—who reported it without irony.

Food inflation in the U.S. has reached a level not seen in decades, with food staples like milk rising 17 percent over the last year, rice, pasta and bread rising over 12 percent and eggs increasing by 25 percent. As job losses mount in the current recession, an unprecedented 28 million Americans are expected to receive food stamps to survive this year. One in six people in West Virginia, and one in ten in Ohio and New York, are now relying on food stamps to survive. And one in three children in Oklahoma have been on food stamps at some time in the last year.

Food stamp “entitlements” are far from generous in the world’s most affluent society, and it safe to say that most people suffering from rising food prices do not qualify for help. According to guidelines posted on the USDA’s website, a family of four is eligible to receive food stamps only if their net monthly income is at or below $1,721. This same family of four is then entitled to a maximum monthly food stamp allotment of $542—the same amount as in 1996. The average subsidy amounts to roughly $1 per meal per person. And 800,000 mostly elderly and disabled food stamp recipients currently receive the minimum benefit of a mere $10 per month, according to the New York Times.

***

Mainstream economists have usually described the global food crisis as a food “shortage”, but the shortage has been greatly exacerbated by the merciless laws of the free market. In many cases, the problem is not an immediate shortage of food but merely a shortage of the money to pay for it. World Food Program Executive Director Josette Sheeran recently remarked about Sub-Saharan Africa, “We are seeing more urban hunger than ever before. Often we are seeing food on the shelves but people being unable to afford it.”

The agricultural/food business is now the second most profitable industry in the world, lagging only behind pharmaceuticals. Indeed the automaker Mitsubishi, which also controls the second largest bank in the world, has become one of the world’s largest beef processors, demonstrating the degree to which capital has flocked to the agribusiness sector. The World Bank’s World Development Report 2008 heaped approval on the role of agribusiness, commenting, “The private agri-business sector has become more vibrant. New, powerful actors have entered agricultural value chains and have an economic interest in a dynamic and prosperous agricultural sector and a voice in political affairs.”

But just as agribusiness wiped out small U.S. farmers in the 1980s, it has repeated this pattern around the world ever since. As global justice activist Vandana Shiva wrote in 2006, in India “without market regulation agribusiness corporations will make profits selling costly seeds, buying cheap farm produce, and locking farmers in debt. This has been the process by which the small family farmer has disappeared in U.S.A, Argentina, Europe.”

Now the law of supply and demand has dictated that the new market for biofuels should reduce the production of corn for food by 25 percent in the U.S.–triggering a manmade shortage and a rise in corn prices. Speculators have been hoarding crops on the expectation that prices will rise further. Meanwhile, investors around the world have been fleeing the falling dollar to buy up commodities such as rice and wheat, adding to the speculative momentum and forcing staple prices higher for the world’s poorest people.

The neoliberal agenda long ago lost its shine for the vast majority of the world’s population, although its most earnest proponents have been the last to recognize this stubborn reality. The most recent World Economic Outlook, published by the IMF last fall, did note rising inequality in the richest countries: “Among the largest advanced countries, inequality appears to have declined only in France… The recent experience (of increasing inequality) seems to be clear change in the course from the general decline in inequality in the first half of the 20th century.”

Yet the IMF remained optimistic about the future of neoliberalism: “from 2002 to the present, the world economy has enjoyed its strongest period of sustained growth since the late 1960s and early 1970s, while inflation has remained at low levels. Not only has recent global growth been high but expansion has also been broadly shared across countries. The volatility of growth has fallen.”

In recent weeks, neoliberal policymakers appear to have finally realized that widespread hunger could ignite a level of protest that threatens the ruling order worldwide. World Bank president Robert Zoellick recently worried on the organization’s website, “33 countries around the world face potential social unrest because of the acute hike in food and energy prices.”

Perhaps these out-of-touch policy wonks should suggest that the world’s poor start eating ethanol, in keeping with their long-standing bourgeois tradition. And U.S. workers now teetering into the neoliberal abyss should consider following their brothers and sisters around the world in fighting back.

Sharon Smith is the author of Women and Socialism and Subterranean Fire: a History of Working-Class Radicalism in the United States. She can be reached at: sharon@internationalsocialist.org. This article first appeared on the SW website. Read other articles by Sharon, or visit Sharon's website.

17 comments on this article so far ...

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  1. hp said on April 11th, 2008 at 8:54am #

    Introducing new and improved Soylent Green!
    Now contains more girls!

  2. evie said on April 11th, 2008 at 11:06am #

    Animal crackers in my soup
    Republican and democrats loop da loop
    Gosh oh gee but I have fun
    Swallowing pundits one by one ;)

  3. Michael Kenny said on April 11th, 2008 at 11:32am #

    Underlying all of this is the fundamental problem of organising the economy in the poor countries in such a way as people can produce enough food to feed themselves. Thus, a switch to biofuels in the US should have no effect on food production in poor countries. Indeed, higher world prices should benefit farmers in those countries. Ms Smith has thus not demonstrated the link between US biofuel production and the rise in food prices, which seems to be more related to the rise in energy prices than anything going on in US agriculture.

    By the way, Vandana Shiva was wrong about Europe. The family farm is still the norm here and US-style “agribusiness” is virtually unknown.

  4. hp said on April 11th, 2008 at 11:32am #

    I chuckled.

  5. Frank said on April 11th, 2008 at 12:41pm #

    You completely neglected to actually link US corn ethanol to the rice price rise. Unless farmers have taken to planting corn or soybeans in their rice paddies, which doesn’t sound likely, the rice shortage is unlikely to be a result of the ethanol boondoggle.

  6. Gavin said on April 11th, 2008 at 2:04pm #

    Not our problem to feed the damn world. there were starving people before ethanol. I am sick of the united states making every poor damn country our problem. they dont want to change, leave them alone.

  7. rosemarie jackowski said on April 11th, 2008 at 4:09pm #

    Could it be that diluting gas with ethanol is just one more scam designed to increase profits for Monsanto and other corporate farms? Amazing how all of this played out. Unbeknown st to most consumers, ethanol is now in all gas in my area. The only indication is a tiny, one square inch sticker on the local gas pumps.
    Hunger and starvation, especially in Haiti, in a disgrace for the U$A. The US destroyed many of the economies in this part of the world. NAFTA destroyed a large percentage of corn agriculture in Mexico. The lack of empathy is at a pathological level in the US.

  8. chuck said on April 12th, 2008 at 9:26am #

    I wouldn’t mind corn being used to make ethanol—except it is being subsidized, both by American tax dollars and import taxes to keep sugar cane ethanol out of the country. Corn ethanol will never solve the energy problem and is only there because of oil companies and politicians from farming states!

  9. hp said on April 12th, 2008 at 9:50am #

    The auto parts industry will notice a rise in profits.
    Ethanol is a parts man’s dream come true.

  10. mary said on April 12th, 2008 at 2:12pm #

    The EU is setting a target of 10%e ethanol in our petrol (gasoline) by 2020. This UK newspaper article reports the building of a refinery in Hull that will consume 1 million tonnes of wheat to produce ethanol, that is 7% of our total wheat crop of 15 million tonnes, which in any case is dependent on the vagaries of increasingly variable weather patterns causing drought and flooding. This use of wheat is bound to add to worldwide pressure on prices of grain, encourage speculation and hoarding against rising prices and eventually to shortages. The poor at the end of this vicious chain will suffer as the author Sharon Smith says in her excellent article. A load of supermarket bread which cost 50p ($1) last year is now 80p. Our unleaded petrol is now 105p per litre (that’s just over $2) and there are difficulties already for many in meeting their bills for heating and food. I hope this link connects to the article.

    http://www.independent.co.uk/news/business/comment/expert-view-with-the-eu-at-the-wheel-biofuel-plant-will-cost-us-dear-457253.html

  11. mary said on April 12th, 2008 at 2:55pm #

    Oh dear my typing! that should have been a LOAF of bread not LOAD!

  12. Hue Longer said on April 13th, 2008 at 7:41pm #

    Michael, the poor countries organized them just fine before any patronizing ruses for making things better for them arrived with colonialism and capitalism.

    If anyone thinks that the US has no blame in the past and in what is currently happening now to countries forced at gunpoint to make trade agreements, they are deluded and willfully uneducated.

    It’s sad too that everything is measured in dollars to explain how well or poor someone is doing. If I never saw a dollar in my life, had a rice Patti or small corn farm, 10 chickens and a personnel food farm, and I took my surplus to a barter market to get medicine and clothing—I’d eat better than the imaginary average family the IMF likes to brag about when 1 dollar goes to 2 dollars a day….but you can’t live like that in most places of the world because your surplus has been made worthless by subsidies and shit trade agreements and the wealthy own all of the property. So get off that plot of land, you worthless slave and get your ass into this shoe company- where we’ll teach you the value of a dollar

  13. Hue Longer said on April 13th, 2008 at 8:13pm #

    and yes, I’d name that patty, Patti (I must have causght it from Mary…hey! Typo Mary..hehe)

  14. John Wilkinson said on April 14th, 2008 at 9:13pm #

    This is what happens when the greedy, swindling swine are allowed to run amok among the world’s ignorant masses and corrupt elites. Regulation of criminal swine’s basest fraudulent instincts is a bad thing, you see. If you don’t know which end is up, if you didn’t have even the most basic education, then you can be easily convinced that shit can be turned into gold and that complicated (and thus relatively scarce) stuff such as food can be turned into oceans of simple stuff such as fuel and that all will be well, and that you can gain energy and profit by spending gargantuan amounts of energy on complicated processes such as growing food and then turning it into low grade fuel. Did you know that food is zillions of times more complicated than fuel? The formula for gasoline (octane) is C8H18. Can someone write out a formula for corn, or a banana? The two worlds are galaxies apart.

    And those same swine are mean, too — no food aid for the hungry. And they’ll be gone (with your life savings, etc.) when it dawns on you what has been done, when you’re left holding the bag. Just like what they did with the S&L fiasco, the dot com, the mortgage mess, the financial and bank mess, the fiscal mess, etc. They are gone — absconded with our money, and we, on top of that have to BAIL them out with our non-existent money, that they stole from us to feed the multi-headed, insatiable, bottomless-rathole Pentagon hydra with their corrupt defense execs buddies. While we don’t get even a penny’s worth from our tax dollars for ourselves.

    When is enough enough? When are we going to start chopping some heads? Returning stolen property and money to rightful owners? It pisses me off that someone who destroys tens of thousands of lives, destroys economies, banking systems, etc., while enriching themselves through outright FRAUD, such swine get 2 years (if that) in a country-club setting with tennis courts, etc, AND they get to keep the stolen goods, while someone who robs a bank of couple thousand dollars gets 20 years to life in maximum security.

  15. John Wilkinson said on April 14th, 2008 at 9:25pm #

    OK, my bad, they’re not turning corn into gasoline but alcohol, C2H5OH, another simple chemical. same thing principlewise.

  16. pedro said on April 23rd, 2008 at 9:20am #

    Slavery is alive and rampant in the 21st century!!!It’s growing by leaps and bounds in tsunami proportions.The ripple of the global rebellion by the poverty-stricken is certain to reach our shores,and when it does, 9 11 will seem meaningless.Human resources development in third world states was critical,and focused mainly on political development.To quote Kwame Nkruma “Seek ye first the political kingdom,and allshall be added unto”.Social and economic well being of the masses was put on the back burner.Democracy has its regrets.Because social and economic does not spring to life with political freedom_you have to work at it.American development in the third world,existed to enhance the economy of the american capitalists,a system that led to the repression of human development in its possessions.And here we are today with the new slave master “massa” Corporate America and the new slaves, the poor of the world……

  17. Allen in Fort Worth said on April 23rd, 2008 at 7:40pm #

    “Now the law of supply and demand has dictated that the new market for biofuels should reduce the production of corn for food by 25 percent in the U.S…..”

    I’m with Frank and several others on this. Supply and Demand had nothing to do with the % of corn grown for food vs. ethanol. It’s been mandated by Congress (and remember all the pandering during the Iowa Caucuses?) . Iowa is going to be a net IMPORTER of corn, it’s so profitable.

    Your democratic congress gives the subsidies to the farmers, the farmers give contributions to congress, the price goes up. See Time magazine’s cover story from a few weeks ago.