Transcript Will the Free Market End Hunger? Food First Text extracted from World Hunger 12 Myths by Lappe, Collins, and Rosset, 1998

Will the Free Market End
Hunger?
Food First
Text extracted from
World Hunger 12 Myths
by Lappe, Collins, and Rosset, 1998
Free Market
• Free Market responds to
money not people
• As poor get poorer and are
pushed from land
– they have even less impact
on markets
• Their needs for food do
not register
• The market responds to
the needs of the wealthy
– to produce luxury goods
http://www.havingaballdresshire.co.uk/toolkit/luxury-dress-rental.jpg
The Market
• Is blind to social and
environmental costs
• Example: U.S. Ag export boom
– Loss of small farmers, rural
communities
– Soil erosion
– Aquifer depletion
– Ground water contamination
– Fossil Fuel waste, global
warming
http://www.klaassenrealty.com/images/auctions/auction_today_sign.jpg
Concentration of Wealth
• The Market leads to a
concentration of
economic power
• Those with greater
economic power
gobble up those with
less
• Food flows from the
hungry to the well fed
http://www.geocities.com/srivathsajoshi/burgerking01.jpg
Inequity
Reward for Hard Work?
• Theory:
– Market rewards hard work
• Reality:
– Market requires hard work and
production
– Market rewards those who have
wealth
– Wealthy can withstand market swings
– Wealthy have better access to credit
• better risk
Donald Trump
http://tv.popcrunch.com/wp-content/uploads/2007/11/donald-trump.jpg
– Wealthy can invest in more land to
offset low grain prices
Distribution of Purchasing Power
•
“The more widely
dispersed purchasing
power is,
• the more the market will
respond to actual human
preferences and needs
• and the more power the
market will have to end
hunger”
– Food First
Mexico
http://z.about.com/d/studenttravel/1/7/X/E/zihua_secret_merc_green_bowl_03.jpg
Structural Adjustment Loans
• Loans given in 1980s-90s
– International Monetary Fund (IMF)
– World Bank
• Condition of loans = Structural
Adjustment Rules
– imposed on governments
• Goal: make developing countries
– Efficient
– competitive
IMF loans
http://jeffboulton.ca/BBB%204M1%20Map%20-%20IMF%20Use%20of%20Credit.gif
• Involved
– deregulation,
– privatization of state institutions
– removal of trade barriers
Effect of Structural Adjustment
• Benefits of institutions and
resources transferred from
public to private business
• Gap between rich and poor
widened as economic power
concentrated
• Poverty and hunger escalated
• Free market increased import
of luxury goods
• Cheap imported grain drove
local farmers out of business
http://ecx.images-amazon.com/images/I/41I1C0Lo5TL._SL500_PIsitbdp-500-arrow,TopRight,45,-64_OU01_AA240_.jpg
http://www.antiwarcommittee.org/imag
Costa Rica
• After a decade of
Structural Adjustment:
– Trade deficit rose 100%
– 76,800 cars entered
country in 3 years
– 42,000 farmers growing
corn, beans and rice
staples went out of
business
Costa Rica Market
http://images.goabroad.com/images/listingphotos/standard/Costa%20Rica%20-%20Fruit%20Stand.jpg
Need Government and Market
• Government and Market must
work together to end hunger
• Market by itself will lead to
concentration of wealth
– and increased hunger
• Government by itself without
market leads to
– inefficiency,
– lack of motivation
– low production
• Example: Soviet Russia
http://www.flykending.dk/tema/museer/nasm/capitol1.JPG
Role for Government
• Government policies can
help to spread the wealth
and means of wealth
– so that the market can serve
more people
• Government can help
insure that people have the
means to support
themselves
– and thus eat
http://www.goldenbuckeye.com/connection/nov2007/2.gif