Tag Archive | commodities

Speculating on food, while millions die


It may not come as a surprise to readers of this blog that many die of starvation while financial institutions with its posse of speculators make a killing (an unfortunate pun) on food. Greed, that insatiable desire to get richer irrespective of the unethical ways we employ to pile up treasures, continue to be the number one cause for the death of millions impoverished by the lack of food. [Check out Barclays Shame Award!] Indeed, “the love of money is the root of all evil”.

 The vampires of hedge funds and speculation on the global market have now glided themselves into the tall grass of a new area. Having caused chaos from the sub-prime mortgage disaster, the consequences of which we are still reaping, these very people are causing food prices to rise, making billions from speculating on food while misery and penury continue to spread around vast parts of the developing world! Speculators now make up over 60% of the commodity markets (used to be around 15%)! Was it not Henry Kissinger who once said that whoever controls food controls people? History is replete with examples of how people are subdued when they see their children starve.

 These banking speculators are only after blood. The collateral damage (human beings) is insignificant. After their sub-prime initiated disaster they need another soft target to make a quick turnover. And what could have been easier than the food commodities, as we all need to eat. Hence, something such as a “futures contract” which in plain English means that that as a farmer I can sell my crops at a future date at a guaranteed price. The catch, however, is that these contracts can be bought and sold by speculators who have no interest in food or feeding people. They are only interested in the gain from the changing prices over a period of time. They gamble on the price of food, disconnected from the reality and with little care about fellow human beings.

 Now I can understand why a rice farmer member in Guyana interrupted my sermon on God’s economy to ask me a more fundamental question: why is it that in spite of the overproduction of rice, the price of rice is lower than any time he knew? The supply and demand excuse is pure bullshit! That is economics for the class room. Rice, sugar, or corn used to mean life for people: now it brings death even if output is greater than any other time

 This sort of speculation, while it is poor people who suffer the most, is just not good for any of us. Speculating motivated by an excessive desire of money, is more than a reflection of personal morality, as some may wish to argue. It has implications for the whole of society. Speculating on food commodities reflect a larger dependence on a model of economic growth that cannot be sustained and the model gives little consideration to social values and the common good. This evil needs to be exorcized. Whether it is regulation, changing of our economic system or reprogramming minds and hearts, the bottom line is that food is not just mere food or a commodity to purchase. It is a basic need and right for every human being: this is why we pray: “give us this day our daily bread”!

 © March 20, 2012

image credit: http://www.BlackCommentator.com