Transcript

Host: This is "On The Line," and I’m Eric Felten.

Steep hikes in the price of food worldwide are impoverishing tens of millions. Josette Sheeran, the Executive Director of the U.N.’s World Food Programme, calls the rising food prices a "silent tsunami," causing millions of people to go hungry. The cost of basic food, such as rice, has doubled in many countries this year. Rising prices for food and fuel have led to protests and even violence in Egypt, Indonesia, Cameroon, Mozambique, Burkina Faso, and Ivory Coast. In Haiti, rice-price riots raged for weeks and led to the ouster of Prime Minister Jacques-Edouard Alexis.

The head of the U.N.’s Food and Agricultural Organization, Jacques Diouf, warns: "There’s a risk that this unrest will spread in countries where fifty to sixty percent of income goes to food."

U.S. President George Bush has ordered an additional $200 million in emergency food aid to address the impact of rising commodity prices. White House spokeswoman Dana Perino noted that the U.S. is already the world’s largest source of emergency food aid, donating over $2 billion in international food assistance last year alone. Ms. Perino says, "The president has made responding to the food crisis a priority":

Perino: "The president has raised this issue with his national security advisers and has asked that the State Department and U.S.A.I.D. look at what can be done in the near term. And then over the long run, the source problems will need to be identified -- the source of where the food is -- so that there’s a long-term plan in place that helps take care of the world’s poor and hungry. Over the last several years, President Bush has advocated -- and did so in his State of the Union address -- for use of up to twenty-five percent of appropriated funds for the local or regional purchase and distribution of food to assist people threatened by a food-insecurity crisis."

Host: What’s causing food prices to ratchet upward? And what can the U.S. and other nations do to head off a growing hunger crisis? I’ll ask my guests: David Smith, Deputy Director of the United Nations’ Information Centre in Washington, D.C.; and joining us by phone from Amsterdam, Vivian Walt, a correspondent for "Time" Magazine. Welcome and thanks for joining us today.

David Smith, let’s start by talking about what has happened to prices. Where have the prices gone up and by how much?

Smith: I think if you look back at last year, I mean, there’s this sort of escalator now moving very rapidly, which is why the United Nations and specifically the World Food Programme is starting to call this a silent tsunami. Why? Because we’re watching an escalator of food prices that last year, for example, meant that wheat rose globally by about seventy-seven percent. Rice this year and rice last year, I think, was fifteen to sixteen percent. Rice this year alone in the first four months of this year has shot up one-hundred-and-forty-one percent. We are looking at $460 a metric ton -- rice -- to well over $1,000 today, making it simply impossible for organizations like mine on one level to buy as they used to at those prices, but equally, when translated to the world’s poor, making food simply unaffordable. And at the same time, the other factors on this escalator are racing away. Look at the oil-price increase, what that does in terms of transportation, in terms of moving food to market. Think of how, you know, we’re watching, at the same time, governments that used to be the world’s producers starting to say, "Maybe we need to think about our own domestic market."

Host: Let me ask Vivian Walt. Are you there by phone, Vivian?

Walt: I am, yes.

Host: Yes. What’s your sense? Is this something that is a spike in prices that’s relatively short-term, or is this something that is a long-term phenomenon that is going to be with us for a long time?

Walt: The folks I speak to, which range from food-industry analysts, government officials, and so on believe that this really won’t be solved for the next decade or so. We’re not looking at something that’s just a seasonal thing during the northern-hemisphere winter, for example. This is really a kind of long-term structural issue. To do what’s -- among other things, the enormous amount of demand for food in China, also India -- I mean, a huge -- millions of middle-class people who can now afford to eat meat a lot more regularly, which means that there’s a huge strain on grain demands in order to feed that livestock that’s being eaten. And also, the slump in the dollar has completely thrown off a lot of projections, in terms of what things cost around the world.

Host: And yet some of those things could also be seen as positive things. David Smith, if we’re looking at demand on food having gone up because people are -- in China and India -- are reaching the middle-class, this is something of a success story. We have people who are eating much better than they used to on a large scale. How do you balance what’s seen as progress with the need?

Smith: Absolutely. I don’t think this should be -- You know, I was a journalist for many years, and I can go back twenty-five years to Ethiopia in the early ‘80s, Uganda in 1980, when I was broadcasting and was one of the first people to do famines in that part of the world -- the Ethiopian famine of ‘83, ‘84, and Uganda in 1980. And what strikes me this time around, sitting in a rather different seat, it should be said, at the United Nations, but twenty-five, thirty years ago, it was very much about, could we stop tens if not hundreds of thousands of people starving to death? If there’s a silver lining to this crisis, it is surely that we are looking at this at the point of production, supply, consumer. The point that our other guest has made is absolutely a critical one -- that we are watching emerging economies -- India, China -- thirty years ago, not in a position to buy in world markets in the way that they do today. And in a sense, this is an aspect of their success story, economically affecting global markets. But we shouldn’t underestimate some of the decisions that will now be faced, and I’d love to know what Vivienne is hearing where she is. There are some very painful decisions. I mean, the World Food Programme, the head of the program, was here last week in Washington, D.C., and it’s very clear in talking to her that she’s going to have to decide who will keep receiving emergency aid and whose rations will have to be cut, and that is a very painful decision at the same moment we’re pointing out the economic success of India and China.

Host: Vivian Walt, what’s your sense on -- You mentioned the structural issues that aren’t going to be resolved anytime soon and not only the issue of rising middle classes in China and India but also fuel and rising fuel prices and what that is doing to food prices.

Walt: Let me just say, for example, I was recently in the Persian Gulf, in a few different countries in the Persian Gulf, spending time with migrant workers in their labor camps. Now, here’s a population of about seventeen million people, very largely Indian, who can no longer afford to feed their families back home in the way that they used to, because they are buying everything with dollars in a dollar economy. It’s translating into far fewer rupees back home. That’s come at exactly the same moment as the spike in food prices. And so you have people making these choices on a whole range of different levels that we haven’t begun to think about -- about how they’re going to spend their money, what real choices they’re going to make about what they buy and who they feed in their big extended families. And, you know, the phrase that you mentioned before -- the silent tsunami -- hits in places which we haven’t really focused on yet. It’s really brought home to me when I go traveling in different places and hear people’s tales about how this is actually sort of coming home to them.

Smith: This is precisely where we are, and Vivienne was just making the point. You know, the silent tsunami is the fact that tens of millions of people -- I mean, the figure that the United Nations is putting on, this is about a hundred million -- it’s a World Bank figure, as well -- of people who are being, as it were, sucked into this crisis of how they provide for their families, how they access food markets, whether the currency in which they’re working will do the job for them in the way that it did just a few months ago. And the silent tsunami is that this is creeping up on them with dramatic speed, and they’re not people that we would normally consider would be vulnerable to this. They’re vulnerable because of the crisis at large -- overproduction, oversupply, overpurchasing. I actually did recognize one thing -- that our World Food Programme, at the moment, in some parts of the world, is simply unable to buy food even though it may have the funds.

Host: We’re joined now also by William Tucker, who’s a journalist and author of the forthcoming book "Terrestrial Energy." He’s in our studio in New York. And William Tucker has written recently about the issue of biofuels and the impact that the move to biofuels has had. Gordon Brown, the Prime Minister of Great Britain, said recently that England may have to reconsider its push into biofuels because of the effect that it was having on food prices. William Tucker, can you hear us? Are you there?

Tucker: I certainly can, yes.

Host: Give us a sense of what your assessment is of how biofuels -- the move to biofuels -- has been affecting world food prices.

Tucker: I think it’s been very serious. I think it’s probably one of the most disastrous public policies we’ve ever undertaken in this nation, where we end up burning a third of the corn crop every year to put in our gas tanks. It was foolish to begin with. But the thing that these -- The idea of solar, renewable, free, sustainable energy -- The thing that these people have always overlooked is the amount of land that was going to be required to do this. If you look at the numbers -- there’s some very simple numbers been around since the 1970s -- it would take about three times the size of the continental United States to produce one-third of our oil requirements by growing it with crops. So this was a very foolish undertaking to begin with, and, unfortunately, it’s having consequences because it competes with food. And we’re seeing this in this country. Food prices are jumping, and it’s even worse. I think energy is the key to all these things, and we have to go back to the root of energy. I myself am a supporter of nuclear power. I think nuclear power is the greatest technological discovery of the 20th century, and I think we have to overcome our fears and start using nuclear instead of going to all these very land-consuming and, you know, fossil-fuel-consuming technologies that we use now.

Host: David Smith, we’ve seen this creeping up on us for a while. I mean, we had -- last summer, there were reports that in Jalisco, the region of Mexico where tequila, the sort of national drink of Mexico, is produced, that the agave plants that have to grow for years and years and years to produce tequila were being -- that many of those plants were being plowed under to plant corn because corn prices had gone up so much because of demand for ethanol. So, how do you try to get the price of food under control when there is this distorting effect from trying to make energy out of food?

Smith: Not my place to get into the politics of biofuels, but I’m obviously aware, and everybody at the United Nations is, that if you have major producing countries -- Look at the United States. I think the World Bank’s got figures out that -- William probably could confirm them -- that would suggest that all the growth in corn production in this country over the past three years has been devoted almost exclusively to biofuels, for obvious reasons of market forces. I was in Brazil last year, where they celebrate -- understandably, on a technical level -- the way in which they converted a fair percentage of their agricultural output to ethanol.

Host: Sugarcane, in that case, being used to produce ethanol.

Smith: You know, what William’s raising is, "What comes first here?" And it’s obviously an extremely delicate one. One of the things that I think we at the United Nations are so consumed by at the moment is watching the number of food-exporting countries shrink on us. Kazakhstan, I think the fifth-largest producer -- William, help me -- I’m pretty sure fifth-largest producer of wheat in the world -- has effectively, in recent weeks, said, "We will no longer be exporting." What will it do to Brazil, as the food-production area under, you know -- fertile under farming -- is reduced by the search for ethanol? This, going forward, is a very serious problem.

Host: Let me ask Vivienne Walt. How do you unravel this problem where high fuel prices contribute so much to the distribution costs of food and, at the same time, add to the push for using food for ethanol purposes?

Walt: Let me just start by saying I’m about to sign off, since I’m actually on a plane, on my way to Kazakhstan, in fact.

Host: You can report to us from the wheat field.

Walt: [Laughing] Right. But, clearly, you know, this is a major problem. I mean, the price of oil, which, you know, has gone up something like fifty percent, as I recall, since last September has completely thrown off the price of everything else. Getting food to market, the price of fertilizers, you know, every single petroleum product that is used in the creation and distribution of an agricultural product, which is multiple things, has gone way up. So, this is extremely important. I think, you know, the one thing that people tell me who are in the aid-and-development field is that one really bad policy move of the last ten years has been the drastic cuts in agricultural research in the Third World and that you have millions of farmers in the Third World producing really below productivity. They don’t have subsidizers for fertilizers. They cannot afford them. They’re producing grains, which are not optimal production. And that’s -- Basically, there has been such a shift away from agricultural research, partly because policy makers never really contemplated facing a crisis of this magnitude.

Host: Well, Vivienne, thanks for joining us. I know you have to get on with your flight. Let me ask William Tucker. Is it your sense that, at this point, the thrust into ethanol is being driven by the sheer price of oil, or is it being driven by government policies that favor ethanol, even though it may not be economically safe for us?

Tucker: It’s absolutely driven from start to finish by government subsidies. We decided in 1979 that this was a good idea. We started subsidizing five cents a gallon at that point. It’s now fifty cents a gallon. I mean, gas costs three dollars a gallon, and fifty cents is a subsidy, a sheer tax exemption that’s given only to ethanol. It’s totally driven by government policies. There’s no market forces here whatsoever. But the trouble is, try to take it away now. I mean, farmers are the most intensely entrenched political constituency in the country. And, you know, we’ve made this mess trying to get rid of those subsidies. Now whole communities in the Midwest have rebuilt themselves around ethanol. So it’s going to be a big, big mess.

Host: David Smith, this issue of subsidies in people talking about what the solutions are -- One of the things that comes up often is that trade policy, that farm policy among countries does distort the ability to get food at a reasonable price worldwide. What’s your sense of the extent to which trade policy and various domestic agricultural policies are affecting the price of food?

Smith: I’m not going to get into what various member states within the United Nations system are doing. You wouldn’t expect me to, and you’ll appreciate -- the politics of this are fairly delicate. And it’s not just in the United States. I mean, William’s raised a very good point about the U.S. Forgive me. I’m from Europe, and, you know, I think about agricultural subsides in the European Union and the common agricultural policy, which is designed, on one level, to protect farmers. So it’s not just about one lead food producer. I’d like to look at the other side, because I think this is where the United Nations is focusing already, and the Secretary General, Ban Ki-moon, is pulling together a task force right now, probably to meet over the next few weeks to start looking at the structural issues and make the U.N., for example, and its many different branches on the food issue come together as one to work on this crisis.

We surely need to do more to help the farmer in the developing world, and we surely need to invest at that end of the spectrum to enable the farmer, for example, to buy fertilizer, to replant after a certain number of years, where fields and crops have been exhausted. But there aren’t the funds at the moment to replant successfully, because we’re already dealing with the effects of climate change in terms of drought across much of our developing world. And unless we invest in the human capital, unless we invest in enabling people to grow food for themselves, then our larger structural issues, be they oil, ethanol, or what we’re producing in the food-producing countries, the net food exporters -- It isn’t -- Those countries alone aren’t going to make the difference. It’s got to happen on the ground of the developing world. And beyond the debates about what we’re doing in the first world, in terms of biofuels, there has to be a serious move towards investing in people growing their own food to feed themselves.

Host: We’ve only got a minute left. Let me ask William Tucker. On this question of investment of crops and research into crops, there’s been a lot of resistance to genetically modified crops of one sort or another. Is that debate going to get reopened where there’s been resistance?

Tucker: Yeah. There was a story in the "New York Times" that they’re starting to reconsider. I think that’s another one of the disastrous -- I mean, we’ve accepted genetically engineered crops in America. Nobody thinks a thing about it. But Europe has been very resistant -- Very superstitious, I think is the word. And, unfortunately, that superstition has found its way down to Africa. Africa is refusing -- I mean, in a midst of a famine, at one point, they refused some food because it was genetically engineered. This is superstition, and, unfortunately, European elites are sort of leading the superstition.

Host: I’m afraid that’s going to have to be the last word. That’s all the time we have for today, but I’d like to thank my guests: David Smith, Deputy Director of the United Nations Information Centre in Washington, D.C.; joining us from our New York studio: William Tucker, journalist and author of the forthcoming book "Terrestrial Energy"; and also joining us from a phone on a plane on the tarmac in Amsterdam, was Vivian Walt, a correspondent for "Time" Magazine. Before we go, I’d like to invite you to send us your questions or comments. You can reach us through our website at www.voanews.com/ontheline. For "On The Line," I’m Eric Felten.