WORLD FOOD CRISIS: A SYSTEMIC FAILURE OF CAPITALISM

THE WORLD COULD BE FACING A REPEAT OF THIS YEAR'S FOOD CRISIS, AS THE IMPACT OF RECESSION UNFOLDS. THIS MONTH, DESPITE WHAT HAS BEEN DESCRIBED AS "HARVEST BUMPER CROPS", THE UN FOOD AND AGRICULTURE ORGANISATION (FAO) WARNED: "UNCERTAINTY IS EMERGING AS A DOMINANT FEATURE OF WORLD AGRICULTURAL MARKETS" AND "EPISODES OF RIOTS AND INSTABILITY COULD AGAIN CAPTURE THE HEADLINES".

ELAINE BRUNSKILL looks at the reasons behind this prognosis and condemns capitalism for being unable to provide basic nutrition for the well-being of humanity.

IT IS estimated that around 20,000 people, predominantly women and children, die of hunger every day. The United Nations estimates that 923 million people, approximately one in six of the global population, suffer from chronic hunger.

In the first three months of this year rice prices rose 141%. The price of one variety of wheat soared by 25% in just one day. And of course it was the world's poor in the neo-colonial countries, many of whom already spend around 80% of their income on food, who were hardest hit. In El Salvador, the poorest are now only eating half as much food as they were a year ago.

Although crop prices have fallen from the all-time highs of earlier this year, the FAO has warned against a "false sense of security".

On the impact of higher food prices, a spokesperson for the UN world food programme commented: "For the middle classes, it means cutting out medical care. For those on $2 a day, it means cutting out meat and taking children out of school. For those on $1 a day, it means cutting out meat and vegetables and eating only cereals. And for those on 50 cents a day, it means total disaster".

Even in the developed world, surging food prices have badly affected working class people and their families. In Britain the increased cost of food, alongside surging utility bills, has squeezed living standards. Food prices are 9.5% higher than a year ago, forcing many to drastically cut what they put in their shopping trolley.

In July, on a flight to a G8 summit in Japan which discussed the global food crisis, Gordon Brown strongly urged a reduction in "unnecessary demand" for food and called on British families to cut back on wasteful use of food. But his call for frugality didn't seem to apply to the world leaders attending the summit. Just hours later, he joined some them and their partners for a six course lunch followed by an eight-course dinner, both with plenty of luxury foods and wines. The staggering cost of the summit was estimated at £285 million.

The hypocrisy of Brown et al, feasting while discussing starvation in the developing world, was not lost on the world's working class and poor. A spokesperson from Save the Children commented: "It is deeply hypocritical that they should be lavishing course after course on world leaders when there is a food crisis and millions cannot afford a decent meal".

Social unrest

Governments across the planet continue to be fearful of the ensuing political and social unrest that is sparked by food hikes. As a spokesperson from the UN world food programme pointed out, unlike previous drought-induced famines, the recent food crisis was not about availability: "People can suddenly no longer afford the food they see on the store shelves because the prices are beyond their reach."

Strikes, protests and riots erupted in many countries. In Haiti protesters forced the prime minister to resign. In Egypt protesters chanting: "Aish! Aish!" - Bread! Bread! - pushed the president to order the army to bake bread for the hungry. Children in Yemen marched to highlight the hunger they were facing. In Mexico "tortilla riots" erupted as the cost of tortillas surged to as much as one-fifth of the wage of Mexico's working poor.

An article in The Times pointed out: "It is easier for urban slum dwellers to riot than for farmers: riots need streets not fields". Undoubtedly, food riots are worrying governments in both the developed and developing countries. However, the fear they have of riots pales when they begin to see how this resistance has the potential to develop into strikes or revolutionary movements when the organised working class moves into action.

In April, a general strike in Burkina Faso, where more than 46% of the population live below the poverty line, was triggered by soaring costs of food and fuel. Reuters reported that such is the discontent that workers from banks, shops, schools and government offices were joined by traders on informal stalls who scrape a living on street corners.

Causes of high prices

Numerous reports in the capitalist press point out that the causes of this year's world food crisis were "complex and interlocking". Speculation played a major role. Fears about investments in the US subprime housing market led to speculators taking billions of dollars out of financial institutions and ploughing them into basic food commodities.

The agricultural futures market was set up to lower the risk associated with price volatility for farmers and buyers. However, from the onset, speculators endeavoured to line their own pockets, regardless of the impact rocketing prices has on the world's poor. For spivs and speculators global shortages and hikes in food prices are good for business.

Other factors also played a role in food price rises, such as weather extremes, high oil prices, biofuel production and a growing global demand for meat. The surging cost of oil impacted on both the production and distribution of food. The manufacture of fertilisers requires petrol or natural gas (which also soared in price). In parts of East Africa farmers had to cut back on crops because they could not afford fertilisers.

High oil costs have led to the promotion of ethanol made from crops such as corn, oilseeds and sugar cane, as an alternative 'green' fuel. This year, 30% of US corn production is being used for the production of ethanol. The EU plans to get 10% of its auto-fuel from bio energy by 2020.

However, even if the entire US corn crop was used to produce ethanol, it could only replace 12% of current US gasoline usage. Therefore, as the price of oil continues to be unstable, the hunt for new sources of biofuels is underway.

In some of the poorest parts of the world, cassava, a potato-like tuber, is an important part of the diet. For example, in sub-Saharan Africa it provides one-third of the needs of the population, and it is the primary staple food for over 200 million of Africa's poorest people. However, its high starch content also makes it a good source of ethanol. Any surge in the production of cassava-based ethanol will have a direct impact on those who rely on it as part of their staple diet.

According to an article in Foreign Affairs: "Filling the 25 gallon tank of an SUV with pure ethanol requires over 450 pounds of corn - which contains enough calories to feed one person for a year".

Foreign Affairs also points out that in both the US and EU there has been a "panoply of subsidies, tariffs and mandates protecting the biofuel sector". However, alongside others it questions the assumption that biofuels are a green alternative.

For example, in the US, corn and soya beans used to often be planted in rotation. Soya beans add nitrogen to the soil, which is needed and used by the corn the following year. However, as corn is now increasingly being grown without the use of crop rotation, nitrogen has to be added to the soil. There are now major concerns in the US around this added nitrogen, as when it rains, the water leaks into waterways. In the Gulf of Mexico such leakage has resulted in a 'dead zone', an area of ocean the size of New Jersey that can barely support life.

Furthermore, scientific studies show the conversion of forest and grasslands to the production of biofuels incur a "carbon debt" from the release of biomass (which is material derived from living or recently living material). For example, in South-east Asia swathes of tropical forest are being burnt down to plant oil palms for the production of bio diesel. This craze for biofuels has been described as 'neither clean nor green'.

The impact of global warming, from record floods in China, to a prolonged drought in Australia, is having a catastrophic impact on harvests. Every year across the planet, drought, deforestation and climate instability ravage an area of fertile ground the size of Ukraine. Over almost a decade Australia has been gripped by a drought which has had a devastating effect on its wheat crop. Conversely, wheat and potato crops in the UK have been hit by flooding.

Drive for profit

Capitalism is utterly incapable of the planning which will be necessary to overcome such environmental catastrophes, because the 'hidden hand' of the free market economy is driven by the capitalists' quest for profit. The capitalist system cannot engage in planning to meet people's needs, because of this inbuilt, insatiable drive for profits.

The globalisation of agribusiness has heavily favoured rich countries and large corporations. Neo-liberal policies enforced by the World Bank and International Monetary Fund (IMF) have effectively used third world debts as a tool to access their markets.

In order to obtain loans or debt relief, governments from the developing world have been forced to restrict food subsidies, which makes it easier for multinational corporations to dump cheap exports, thereby undermining local food production. Yet at the same time huge subsidies are given to agribusiness in the developed word.

Between 1999 and 2002, $76 billion was handed out to US farmers. However, two-thirds of American farmers do not receive a dime. In 2003 the richest 10% of subsidised farmers took 66% of the payouts, the top 5% received 55%.

World Bank and IMF directives have also forced farmers in the neo-colonial world to mass produce cash crops for the world market, rather than produce a wide range of staple crops that can feed the local population. The terms of trade between rich and poor countries were progressively worsened to the detriment of the poor, ie less money was paid for their cash crops and more money was charged for goods they need to import.

The multinational agricultural conglomerates benefited hugely from this. The planet's poor may be starving, but big businesses are raking in super profits.

In April Monsanto reported its net income for the three months up until the end of February doubled in comparison to the same period in 2007; its profits leapt from $1.44 billion to $2.22 billion. Archer Daniels Midland, one of the world's largest agricultural processors of grain, saw its operating profit on its grains merchandising and handling operations soar 16-fold in the first three months of this year from $21 million to $341 million.

The food crisis worldwide highlights that capitalism is an inhumane, anarchic system which is incapable of feeding the world's masses. The Economist pointed out that in agriculture: "Yields cannot be switched on and off like a tap". However, the free market system is incapable of establishing a long term strategy.

For capitalism, food is just another commodity, from which profits can be extracted. When the market dictates that grain has a value as fuel, people in parts of the world go hungry. Likewise the price for seeds and fertilisers is based on the maximum profits that can be secured, regardless of the ability of neo-colonial farmers to buy at these prices.

We live on a planet where over a billion people barely exist on $1 a day and 1.5 billion live on $1-$2 a day. Capitalism has nothing to offer them - not even enough food in their bellies. In the developed world also working people are increasingly struggling to feed themselves and their families.

The strikes and protests that have rocked the neo-colonial world are a foretaste of future mass struggles that will develop across the planet. Such struggles can lead to the development of new mass parties of the working class that put forward an alternative to the brutality of the free market economy.

Ultimately, only a socialist society can eradicate hunger on a global scale. This would entail taking the agribusiness multinationals out of the hands of the profiteers. In their place would be a democratically run and publicly owned food industry; only then can we start planning production for the needs of the world's people.

US: POLITICAL AWAKENING PROPELS OBAMA TO VICTORY

But Will He Deliver?

On Tuesday, voters delivered a decisive, historic defeat to the Republican agenda of corporate greed, corruption, and war. While the total voter turnout remains unclear, experts are estimating up to 64% of eligible voters cast ballots, the highest in at least 40 years, potentially the highest in a century.

As news agencies announced Barack Obama had secured the 270 Electoral College votes needed to win the presidency, millions of Americans gathered in bars, living rooms, and election night rallies, erupted in cathartic celebration. Spontaneous street parties and raucous marches filled city streets late into the night. The reign of George W. Bush, the most hated president in modern history, is over.

On top of that, the election of an African-American as president of the United States, less than 50 years since legal segregation, is being greeted with widespread euphoria. Across the globe millions are in celebratory awe at the image of a black man, with the middle name of "Hussein," replacing the hated Bush regime. There is enormous hope that Obama's election night promise of "a new dawn for America" is indeed in progress.

But will Obama and the Democratic Party deliver? Facing the worst economic crisis since the Great Depression, a projected trillion dollar budget deficit reaching 6% of U.S. GDP, and a new unraveling of the wars in Iraq and Afghanistan, Obama and the Democrats come to power amid a massive crisis of U.S. and world capitalism.

Their problems are worsened by a sharp contradiction between the massive expectations for change among millions of workers and the actual big-business agenda Obama intends to carry out. In particular, it will be the same fierce economic anger which propelled Obama to victory which will, at a certain stage, push growing layers of the multi-racial U.S. working class into active opposition to his administration. The stage is set for a new, tumultuous period in U.S. history.

Decisive victory

The Democratic victory was overwhelming. Obama won 52% of the vote to McCain's 46%, defeating McCain by 7.4 million votes. Obama's victory with the undemocratic Electoral College was even more decisive - 349 to 163 - with the Democratic candidate taking several states previously considered Republican strongholds. In Congress, the Democrats picked up five Senate seats, with several races still undecided, though they will not likely reach a filibuster-proof 60 strong caucus. While several races remain undecided, in the House the Democrats have secured 20 more seats, which added to the 30 seats they gained from Republicans in the 2006 elections, gives them a decisive 254 to 173 majority.

According to exit polls, Obama won majority support in almost every demographic. Seven out of every ten urban voters supported Obama over McCain. The same proportion held for young voters and first time voters. In small cities, Obama won 59% of the vote, as well as 50% in suburbs. Only among rural voters and those over 60, did McCain win.

Obama's stunning fundraising advantage was another factor, allowing his campaign to dramatically outspend McCain in advertising and get-out-the-vote organizing. This was fueled in part by historic numbers of small donations, but more significantly big business and the financial oligarchs of America gave Obama their backing, filling his campaign coffers with over $640 million. The wealthiest Americans, making over $30 million a year, gave to Obama 3 to 1 over McCain.

Obama has rewritten the book on presidential elections, and not just by the sheer amount he raised or his decision not to take public financing. Obama received 3.1 million financial contributors. His Facebook page has 2.2 million supporters and he has more than 700 campaign offices in every state in America.

Among African-American voters, who turned out in historic numbers, 95% supported Obama. While only 43% of whites voted for Obama, this is a higher percentage than Clinton or Kerry received, and roughly half of white working-class voters backed Obama.

Though racism is by no means extinguished in the U.S. - indeed the McCain campaign's thinly veiled racist attacks revealed that deep pockets of bigotry remain - nonetheless Obama's ability to win support in regions and constituencies previously dominated by Republicans reveals a very real process of change in Americans' attitude toward race.

Racism undermined

Obama's victory itself does nothing to assure genuine change for the majority of African-Americans who continue to languish under poverty, de facto segregation, and police repression. At the same time, the symbolic importance of electing the first black president should not be underestimated. In a country where less than fifty years ago Jim Crow laws assigned African-Americans to second-class citizenship and where dogs and water cannons were put on those who fought against this, Obama's victory will no doubt be a catalyst for further inroads against racism.

This will be seen as a victory not only for African-Americans, but also Latinos, Asians and Americans of other races who have been shut out of power throughout the long racist history of American capitalism. Today workers from Mexico and Latin America are being arrested, their families split up, in racist immigration raids.

For African-Americans, the election of Obama could have a huge galvanizing effect. The New York Times describes a 55 year-old African-American janitor who registered to vote for the first time a month ago. "This is huge. This is bigger than life itself. When I was coming up, I always thought they put in who they wanted to put in. I didn't think my vote mattered. But I don't think that anymore." (11/2/08)

David A. Bositis, senior political analyst at the Joint Center for Political and Economic Studies in Washington stated: "It's not just a question of Obama as the first black nominee; it's also that African-Americans have suffered substantially under the Bush years and African-Americans have been the single most anti-Iraq-war group in the population." (NYT 11/2/08)

Obama's election could be a spark that helps ignite a new movement to fight for better conditions among African-Americans. However, any such movement would rapidly find itself in opposition to the big-business agenda Obama will inevitably pursue. While Obama will likely pursue limited measures to address the impact of the deepening economic crisis on working people, resolving the mass poverty and unemployment in the black community will require a colossal public works program, funded by heavy taxes on big business, something Obama has shown little inclination towards.

Economic anger

The dominant issue which emerged in this election was the economy. The war in Iraq was a crucial backdrop to this at the beginning of the election process and will remain a running sore. After two decades of wage stagnation, leaving families to work more hours and more jobs to get by, working-class people have seen a real fall in their living standards in the last few years. The Bush administration's blatant pro-business rhetoric and its outrageous handouts to corporate friends caused a large target to be painted on the back of any Republican candidate. The economic meltdown in October sealed their fate. In October 2008 an astonishing 85% of Americans said the country is on the wrong track.

Attempts by Republican candidate McCain to redefine the dominant issue of this election totally failed. Similarly, their attempt to paint Obama as a friend of terrorists, a Muslim, culturally 'different' (code for racism) and finally as a socialist, failed to affect most voters. The tried and trusted Rovian method of blatant misrepresentations, which they used to bury Democratic Party candidates in 2000 and 2004, failed to stick with a more politicized and attentive attitude among the voting mass. Interestingly, the attempt to define Obama as a 'wealth re-distributor 'actually helped expose how unequal America has become due in part to the Republican-initiated tax cuts for the rich, while stimulating a national discussion on "socialism."

The ability of Obama to present himself as the agent of change has been decisive amongst an electorate desperately looking for an end to the disastrous consequences of a Republican-dominated agenda in Washington. What Obama has managed to conceal is how similar his policies are to those policies.

In a demonstration of how far this electoral system is from a democratic system, those candidates who could have offered a fundamental alternative to these polices were shut out of the debate. In particular, Ralph Nader was barred systematically form the media and from the debates. Cynthia McKinney, candidate for the Green Party, was also excluded. By offering a $10-an-hour minimum wage, ending the for-profit health care system that plagues the majority of Americans' lives, ending the war, and exposing the corporate funding that defines the policies of the two major candidates, well-known consumer activist Ralph Nader would have transformed the debate by shining a bright light on Obama's refusal to move beyond a promise of change.

Under these conditions, Nader's vote was squeezed to less than 1%. Despite this, the 2008 Nader campaign's ability to achieve ballot status in 45 states and to raise $4 million demonstrated the potential for building a national electoral challenge in years ahead.

Republican meltdown

Astoundingly, it was left to the right-wing Republicans and Sarah Palin to use the term "working class," and attempt to explicitly tap the class anger in U.S. society. Palin looked to appeal to the deep alienation working-class Americans feel toward the political system. However, the majority of voters understood this was just another trick by Republicans to confuse voters. The spectacle of Palin firing up the right-wing base, and effectively running her own political campaign, merely exposed ever further the fissures in the Republican Party, the gulf between old Corporate Republican leaders like McCain and the alternative agenda of the right wing.

The opposition and ridicule Palin inspired among the broader voting public shows how diminished the far right has become. Defections from the GOP have increased as Bush's economic policies were felt by millions of "red-state" workers. The situation was epitomized in a photograph depicting a homemade sign with the Confederate flag and the words: "Rednecks for Obama. Even we've had enough."

One can expect to see a fierce battle for the soul of the Republican Party in the coming months and years, as these two wings wage a battle for domination of the party. Their problems are worsened because candidates representing the traditional big-business wing of the party lost more seats in the House and Senate than the far-right wing. Now the ideology of the party is increasingly dominated by what The Economist describes as "southern-fried moralism."

Obama's agenda

Lacking from most post-election analysis was the crucial role played by big business in the election. With their money, their control of the media, and their political influence, the U.S. financial elite helped elect Barack Obama. Confident that an Obama White House will not defy them or shake things up too much, Corporate America opened their wallets to his campaign. Despite his carefully scripted comments about not receiving donations from corporate lobbyists, Obama's candidacy has received far more corporate dollars than McCain's (opensecrets.org).

Of course this does not discount the significance of donations made by historic numbers of working-class Americans to Obama's campaign. However, it will not be ordinary working-class people who will be sitting in his cabinet, or advising him on policy issues. It will be the same Wall Street and corporate executives and established pro-imperialist foreign advisors who have been in the cabinet of the US presidents for the last 120 years. They will be the ones driving Obama's domestic and foreign policy.

Here lies the contradiction in Obama's victory. Obama has managed to speak to Americans of all incomes, including the very rich and the poor. He has received money from regular workers and from corporate CEO's. He has promised to govern one America. However, we don't live in one America. We live in two Americas. One that has grown fabulously rich, and another that is taking it on the chin, with working people scraping by, working unstable jobs, just a layoff away from losing their homes or apartments. One America for the billionaires and another for the rest of us.

During the election, this contradiction could be papered over. However, once he starts governing, Obama will be forced to decide between the two classes.

On Wednesday Obama announced his transition team, with the conservative chairman of the Democratic Caucus Rahm Emanuel as his Chief of Staff. Emanuel emerged as a major power-broker in Washington after he engineered the Democrats 2006 election victory, which saw the strengthening of the so-called "Blue Dog" conservative Democrats. In several cases, Emanuel used his control of Democratic Party money to engineer the defeat of more liberal Democrats in the primaries, even where these candidates were more competitive than their favored conservative rivals.

Clinton's former chief of staff, Leon Panetta, was reportedly the main architect for Obama's transition plan, which has been crafted over months. Discussing how Obama will address the severe economic problems, Panetta advised, "You better damn well do the tough stuff up front, because if you think you can delay the tough decisions and tiptoe past the graveyard, you're in for a lot of trouble... Make the decisions that involve pain and sacrifice up front." (NYT, 11/5/08)

A long honeymoon?

Given the massive budget deficits, which is running at 6% of GDP federally and forcing emergency measures in state governments, Obama's ability to enact serious reforms to relieve working-class people will be limited. The relatively minor new taxes he is proposing on the wealthy will not change the equation substantially, given the overall fall in tax revenue as the recession bites.

Nonetheless, Obama has reportedly been discussing with congressional leaders about a "possible $100 billion for public works, unemployment benefits, winter heating assistance, food stamps and aid to cities and states that could be passed during a lame-duck session the week of Nov. 17." (NYT, 11/5/08) Even from the standpoint of big business, such limited proposals may prove necessary to prevent a further economic collapse and a more complete discrediting of capitalism. However, such measures will at best slow but not reverse the catastrophic declines in living standards that are already underway in working-class communities.

Furthermore, as he did with the $700 billion bailout in September, Obama has indicated support for further taxpayer handouts to the financial elite and big business. The big three auto-makers, who faced catastrophic declines in their sales last month, are faced with the near-term prospect of bankruptcy unless the federal government comes to their aid. Such aid, however, will not reverse the waves of layoffs and wage and benefit cuts facing autoworkers.

It remains to be seen how rapidly or fully Obama will move to implement his various other campaign promises, from health-care tax credits to closing Guantánamo Bay. In Iraq, Obama's pledge to draw down troops will be complicated by the failure of the Iraqi government to formally agree to a continued U.S. troop presence, and the renewed tensions between the Sunnis, Kurds, and governing Shia. In Afghanistan, the situation is unraveling fast with many warning that Obama's plan for a troop surge there will only provoke further conflict.

Nevertheless, even limited reforms by an Obama White House will contrast sharply with Bush's reign, and could give Obama a certain honeymoon period. Democrats' call for patience in the face of the economic crisis, which they have blamed completely on Bush, will get an echo for a period.

However, the experience of the 2006 elections must be remembered, when the Democrats swept into power in Congress on promises to end the war and hold Bush accountable. Their failure to do either provoked rapid and sharp outrage among a more politicized minority of workers and youth. Cindy Sheehan, who broke with the Democrats in the summer of 2007, represented a small but important tendency. With expectations so high, Obama will undoubtedly eventually disappoint millions in office, and a radical minority will open to far-reaching conclusions about the need for a political alternative.

Millions of young people, people of color and ordinary workers have had their confidence raised. Many will be inspired to step forward into political activity as a result of this election. Many of them will see the need to mobilize campaigns and protests in an attempt to keep Obama's attention on those who elected him. Others will be forced into struggle to defend themselves against the cutbacks and attacks resulting from this recession. The wave of political awakening which Obama rode to power was not the creation of his campaign, and the radicalization of the U.S. working class won't stop with the end of this campaign - just the opposite, in fact!

Movements that develop will inevitably come into sharp conflict with an Obama administration. Events will expose Obama, and Congressional leaders as representatives of big business. As a result the way will be prepared, for a new political and class awakening in U.S. society. Consciousness of the need to break with the Democratic Party will grow. More than ever, the question of building a political voice for working people will emerge onto the political agenda. The idea of a new anti-corporate, antiwar political party, a party of working people, will gain traction in the minds of millions, as ordinary people struggle to find a path toward genuine change, a way out of the economic and social crisis engulfing U.S. society.

Ty Moore and Tony Wilsdon, Socialist Alternative (CWI USA)

November 6, 2008