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     Jun 19, 2008
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Are we all North Koreans now?
By John Feffer

Gas prices in the United States are above US$4 a gallon; global food prices surged 39% last year; and an environmental disaster looms as carbon emissions continue to spiral upward. The global economy appears on the verge of a technical knockout, a triple whammy from energy, agriculture and climate-change trends. Right now you may be grumbling about the extra bucks you're shelling out at the pump and the grocery store; but, unless policymakers begin to address all three of these trends as one major crisis, it could get a whole lot worse.

Just ask the North Koreans.

In the 1990s, North Korea was the world's canary. The famine that


killed as much as 10% of the North Korean population in those years was, it turns out, a harbinger of the crisis that now grips the globe - though few saw it that way at the time.

That small Northeast Asian land, one of the last putatively communist countries on the planet, faced the same three converging factors as we do now - escalating energy prices, a reduction in food supplies and impending environmental catastrophe. At the time, of course, all the knowing analysts and pundits dismissed what was happening in that country as the inevitable breakdown of an archaic economic system presided over by a crackpot dictator.

They were wrong. The collapse of North Korean agriculture in the 1990s was not the result of backwardness. In fact, North Korea boasted one of the most mechanized agricultures in Asia. Despite claims of self-sufficiency, the North Koreans were actually heavily dependent on cheap fuel imports. (Does that already ring a bell?) In their case, the heavily subsidized energy came from Russia and China, and it helped keep North Korea's battalion of tractors operating. It also meant that North Korea was able to go through fertilizer, a petroleum product, at one of the world's highest rates. When the Soviets and Chinese stopped subsidizing those energy imports in the late 1980s and international energy rates became the norm for them, too, the North Koreans had a rude awakening.

Like the globe as a whole, North Korea does not have a great deal of arable land - it can grow food on only about 14% of its territory. (The comparable global figure for arable land is about 13%.) With heavy applications of fertilizer and pesticides, North Koreans coaxed a lot of food out of a little land. By the 1980s, however, the soil was exhausted, and agricultural production was declining. So spiking energy prices hit an economy already in crisis. Desperate to grow more food, the North Korean government instructed farmers to cut down trees, stripping hillsides to bring more land into cultivation.

Big mistake. When heavy rains hit in 1995, this dragooning of marginal lands into agricultural production only amplified the national disaster. The resulting flooding damaged more than 40% of the country's rice paddy fields. Torrential rains washed away topsoil, while rocks and sand, dislodged from hillsides, ruined low-lying fields. The rigid economic structures in North Korea were unable to cope with the triple assault of bad weather, soaring energy and declining food production. Nor did dictator Kim Jong-il's political decisions make things any better.

But the peculiarities of North Korea's political economy did not cause the devastating famine that followed. Highly centralized planning and pretensions to self-reliance only made the country prematurely vulnerable to trends now affecting the rest of the planet.

As with the North Koreans, our dependency on relatively cheap energy to run our industrialized agriculture and our smokestack industries is now mixing lethally with food shortages and the beginnings of climate overload, pushing us all toward the precipice. In the short term, we face a food crisis and an energy crisis. Over the longer term, this is certain to expand into a much larger climate crisis. No magic wand, whether biofuels, genetically modified organisms, or geo-engineering, can make the ogres disappear.

After the attacks of September 11, 2001, "We are all Americans" briefly became a popular expression of solidarity around the world. If we don't devise policy choices that address energy, agriculture and climate, while replacing the idolatry of unrestrained growth at the heart of both capitalist and communist economies, the tagline for the 21st century may be: "We are all North Koreans."

Through a glass darkly
For years, development experts have bemoaned the declining terms of trade that have kept some developing countries, and most poor farmers, mired in poverty. With the exception of the first energy crisis era in the 1970s, between the end of World War II and 2006, food prices never stopped sinking in relation to manufactured goods. Lower food prices are generally a boon for consumers. But they are devastating for the subsistence farmers who make up the vast majority of the world's poor.

However, over the past three years, according to the World Bank, food prices have increased 83%. That may be only an annoyance for wealthy shoppers, but for the poor, who often devote more than 50% of their incomes to feeding their families, such staggering rises can be the difference between life and death.

There are a number of reasons for this recent spike. The price of oil, now near $140 a barrel, has certainly played a crucial role in this, both by driving inflation generally and because of its importance to modern, large-scale agriculture. So has the recent allocation of ever-more agricultural land to biofuel production. US farmers, responsible for 70% of all world corn exports, now dispatch one-fifth of their corn to ethanol production, which has had the effect of nearly doubling the price of corn.

Global warming, too, has had an impact. Drought in Australia and the eastern United States, severe flooding in China and Bangladesh, rising ocean levels and fresh water shortages throughout the world are all thought to be related to climate change, though climate scientists cannot prove that any given weather anomaly is caused by global warming.

Climate scientists can be fuzzy this way about causality in the short term. Paradoxically, however, they often see the future more clearly. For instance, the top global food policy think-tank, International Food Policy Research Institute (IFPRI), predicts that global warming will be responsible for a 16% decrease in agricultural gross domestic product globally by 2020. The Center for Global Development argues that developing countries, in particular, will be hit hard by climate change: By 2080, India, its report argues, will see a staggering 30-40% drop in agricultural production and Senegal will plummet 50%.

In the United States, a much-anticipated, George W Bush-administration-delayed federal study foresees water shortages, more herbicide-resistant weeds and more insect infestations as a result of climbing temperatures. The present food crisis, concludes Joachim von Braun of the IFPRI, "foreshadows what climate change will bring us."

The other major driver of food price increases is certainly rising income levels in key developing countries. With more income, people can, of course, eat more, and eat higher off the hog - or, put another way, they can eat hog in the first place, rather than the lentils or cassava on which they were subsisting.

Over a decade ago, Lester Brown, the founder of World Watch, suggested that just such a crisis was on the way. He asked whether the world could possibly produce enough grain to feed a more prosperous China. Now, growing middle classes in China and India, the world's most populous countries, are, just as he predicted, changing their eating habits and consuming more meat (and so, indirectly, a great deal more grain, which is used to feed the animals they are now cooking).

Brown was ahead of the curve, but there were ample warning signs of an impending food crisis for those ready to see them. Oil prices have been steadily increasing since 2004 as a result of rising demand. They have been helped along greatly by growing chaos in the Middle East, fed by the Bush administration's foolhardy invasion of Iraq.

Like the North Koreans, we, too, have been trying to squeeze more food out of a limited amount of land: arable land per capita is declining at a steady rate. Falling water tables and dry rivers - think climate change again - have no less surely pointed to a coming crunch for farmers dependent on irrigation. And don't forget: critics of biofuels warned time and again that there wasn't enough elasticity in the food supply to take food out of the mouths of people in the global South to fill the gas tanks of the global North.

In the early 1990s, the North Korean leadership failed to grasp the correlation between rising oil prices, declining food stocks and environmental stresses - and the political pundits and politicians of the planet conveniently wrote off the resulting catastrophe as uniquely the fault of the world's weirdest country. Instead of taking a timely hint, wealthier governments simply shrugged off the warnings of scientists, development professionals and energy specialists about future crises.

Responding to riots
There's nothing like a food riot, however, to get wealthy governments to sit up and take notice. Humanitarian organizations and aid officials may be concerned about people quietly starving to death in remote locations, but only when world security suddenly seems threatened and governments totter do rising food prices translate into a full-blown crisis.

Washington, for example, woke up when riots broke out in Egypt, Haiti and Indonesia, and the militaries in Pakistan and Thailand intervened to protect crops and storage facilities.

In response to the sudden crisis splatting on the global windshield, the United Nations food aid agency, the World Food Program, called for $755 million in emergency contributions. Saudi Arabia, its coffers flooded with oil profits, promptly promised $500 million. The World Bank then announced it was increasing its overall support of global agriculture by $2 billion in 2009, while Washington offered $5 billion in food aid over the next two years.

Such an emergency response may, indeed, be necessary, but it is also distinctly inadequate. The director general of the UN's Food and Agricultural Organization, Jacques Diouf, has called for a minimum of $30 billion a year for a global agricultural restructuring. It's not at all clear who will pony up such sums, which, in any case, will be too late for countries like Haiti whose subsistence farmers needed help before their most recent growing seasons started. Most importantly, though, as an approach, it's too conventional and, in the long run, bound to fail.

After all, the wealthiest countries continue to show little or no interest in altering the policies that have contributed so decisively to the food crisis in the first place. Take the United States. It "ties" - places restrictions on - about 70% of its aid. That means recipient countries must use that aid to buy US products, which, of course, will do little to strengthen local economies. Washington has also cut its international agricultural research by as much as 75% at a time when agricultural production is no longer keeping pace with population increases.

Add in the $280 billion farm bill that congress has just passed which, unbelievably enough, provides continued subsidies to "farmers" (read: agribusiness) already benefiting enormously from high food prices. And the European Union, like the United States, is refusing to backtrack on its commitment to boost biofuels produced from grain.

Nor is there much hope for a new Green Revolution. While the 

Continued 1 2  

Myth-makers caught short in oil speculation
(Jun 18, '08)

Food summit overlooks price-surge ingredient
(Jun 11, '08)

1. Myth-makers caught in oil speculation

2. Iraq takes a turn towards Tehran

3. Nuclear find raises the ante against Iran

4. India goes to war in space

5. The murder of US manufacturing

6. Fed actions risk deeper crisis

7. The pope, the president and politics of faith

8. The great land grab

9. Miracle to mirage in Vietnam

10. China has an 'old friend' in Medvedev

(24 hours to 11:59 pm ET, June 17, 2008)



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