Food hoarding? Oh, good.

Although I'm stereotypically the news junkie of our household, Becky has sometimes been getting out ahead of me recently in recognizing developing major news stories, in part because her playlist of things to listen to on her iPod while feeding Loyette includes some good newsy podcasts. Anyway, she's been talking about food hoarding for some time. Now that story has appeared on my radar screen, via Drudge:

Farmers and food executives appealed fruitlessly to federal officials yesterday for regulatory steps to limit speculative buying that is helping to drive food prices higher. Meanwhile, some Americans are stocking up on staples such as rice, flour and oil in anticipation of high prices and shortages spreading from overseas.

Their pleas did not find a sympathetic audience at the Commodity Futures Trading Commission (CFTC), where regulators said high prices are mostly the result of soaring world demand for grains combined with high fuel prices and drought-induced shortages in many countries.

The regulatory clash came amid evidence that a rash of headlines in recent weeks about food riots around the world has prompted some in the United States to stock up on staples.

Costco and other grocery stores in California reported a run on rice, which has forced them to set limits on how many sacks of rice each customer can buy. Filipinos in Canada are scooping up all the rice they can find and shipping it to relatives in the Philippines, which is suffering a severe shortage that is leaving many people hungry.

My expert analysis is that, uh, this isn't a good thing.

Incidentally, I've created a separated blog category called "The Economy & Finance." With all the bad news about those topics lately, it was time.

Comments

[John McCain]

Regulation of the economy is bad. The market will fix this just like it does everything else.

[Angrier and Angrier]

People who shop at Costco 1) watch world news and 2) eat Basmati rice?

Sorry. My "elitism" is showing.

[Brendan Loy]

At least your name isn't Bitterer and Bitterer.

[Angrier and Angrier]

Touché

My wife and I are in the process of buying buckets and 100lb of rice and oatmeal. Some dry beans too. we'll pour it in a bucket with 1/2 inch of air at the top, then put in enough dry ice to force out the oxygen. When the fog stops rolling off, seal it up; it'll be good for 10 years.

If we haven't used it after 10 years, it will have been cheap insurance.

(demographic note: I am 20s white married male conservative, BS degree, Christian, gun owner, voter, who doesn't trust the gov.)

[Angrier and Angrier]

You forgot to add "nuts" to your demographic note.

[Angrier and Angrier]

By the way, if you don't trust the government, why do you trust the FBI and CIA to have access to your phone calls and e-mail without following proper procedures?

[Jay Johnson]

I've been hoarding food around my waist for years, just in case this happens. Bring it on, famine!

[Brendan]

LOL!

[john]

Angrier, I am the 2:46 guy. I am politically active, but I live in WA where voters don't matter much. The state gov has repeatedly ignored the voters around here. I don't trust .gov with email, or phone either, but I'm not cynical enough to use only cash and disposable phones.

Buying lots of food is not because a famine is coming. It's because in 3 years the price will be double and I can save some bucks by stocking up now.

I have always had at least 30lb of rice in my garage, and at least 20lb oatmeal. Add some beans and frozen veggies... there is no cheaper way to eat. All I'm doing is increasing my inventory.

what happened to the last post?

[copndor]

I hate to play the "the problems the States pale in comparison to other parts of the world where this is going to cause massive deaths" card, but the problems the States pale in comparison to other parts of the world where this is going to cause massive deaths.

http://www.independent.co.uk/news/world/politics/food-crisis-needs-aid-on-scale-of-tsunami-to-avert-famine-814066.html

[Brendan Loy]

4:55, it's back. I noticed an error that I needed to fix. Sorry for any confusion/inconvenience.

[Alasdair]

A&A - I just stocked up on Basmati rice this weekend at Costco in the Los Angeles area ... no rationing ... (we happen to like Basmati rice - what can I say?) ...

With that said, it does seem sorta short-sighted to be converting potential human-grade food supplies into fuel for vehicles rather than encouraging drilling in a tiny percentage of ANWR which is also remarkably UNattractive ... but what the hey ? it's more important to preserve unspoiled Nature rather than trying to save humans from starving, right ?

(sigh)

[Becky]

I refused to stock up on rice at the grocery store. I'm not going to contribute to this panic-driven food rush. In fact, the only time I'm inclined to go on an emergency shopping trip is if I'm in Buffalo, low on toilet paper and beer and there's a blizzard coming.

[Mad Max, Esquire]

To Alasdair's point, the price of all commodities are going up due to speculation. With the stock market flat, real estate busted, bonds dull and the weak dollar, the speculative bubble switched first to oil and gold, and is now making its way into food commodities based on all the hysteria about alternative fuels and China's demand.

As for the human-grade food argument, I, for one, am not a huge fan of bio-diesel. Personally I think we need to work on hybrid technology until we can switch to a low or no-carb technology like hydrogen fuel cells. Bio-diesel is just trading one polluting source of fuel for another one. Also, even if you come up with a way of using non-food crops, the farmers planting corn now will just stop planting corn in order to plant the higher priced non-food crop.

Anyway, Americans eat too damn much food and it is subsidized too much by the government. We should have less food in the supply chain and this could help accomplish that.

[Andrew]

For background on the problem over rice shortages and the Philippines, this article is a good primer. Bottom line: Years of agricultural protectionism and subsidies (including subsidies for corn-based ethanol in the U.S.), combined with other factors such as local droughts, are resulting in massive commodities spikes that are exacerbated by really bad trade and economic policy in many different countries. The fact that Filipino families are buying rice at Costco to send to their relatives across the Pacific should come as no surprise given the total dysfunction of the Philippine authorities when it comes to agricultural, economic, and trade policies.

[Mike's brother Matt]

Okay, quick summery of my positions here:
Biofuels: Incredibly stupid and wasteful. Really only exist because of the Iowa caucuses.
Food subsidies: These, in the US at least, don't subsidize the price of food for consumers. They artificially jack up the prices of foods to keep farmers happy. Once again, blame Iowa.
World food shortages: For the most part, a lie. Famines almost never correspond to crop failures, but rather to panics and inept governments interfering with farming and distribution. In cases where this is a continuing problem, it's mostly because large numbers of people are living on land that can't support them, but get bailed out by foreign aid.
Solutions: Make all foreign food aid totally controlled by the nation supplying it. And I do mean totally. If the US is supplying food to the Congo, we should have the power to take the food from the US and take it to the people themselves, without letting the Congo's government touch the food at any point along the way. If Congo's soldiers decide to interfere, the supply convoys should open fire on the soldiers. It's the only way to break the policy most of these dictators have found of creating famines and then using control over relief supplies to cement their own power. If they refuse to cooperate, fine. The blood's on their hands.
As for the other problems, we could solve them by taking away Iowa's protected spot in the campaign schedule. I still have yet to hear a sane argument for a nominating process that focuses more on Iowa than Ohio.

Biofuels: Incredibly stupid and wasteful. Really only exist because of the Iowa caucuses.

yeah its stupid to invest in potentially better, renewable resources that given advancements in technology have the potential to leapfrog gasoline in terms of cheapness and efficiency. we should screw science if something isn't better right now and only invest in things that are immediately better with no time to research them right???

[Mike's brother Matt]

No, you damned idiot, we shouldn't try to mass produce something that doesn't work. If we were talking about small test projects on trying to find a crop that could actually work, that'd be one thing. But we're not. INstead we're trying to mass produce biofuels that don't work. And yeah, technically, with enough advancement we could get to the point of them being more efficent than gasoline. Or, we could spend the money on pebble-bed nuclear reactors, drive the price of electricity down to the point where pulling hydrogen becomes viable, and use that to run cars. Of all the many stupid attacks on me in my life, accusing me of being against technological research is the most absurd. You're the one who doesn't want actual progess, instead wanting to keep things as close to the way they are now and bankrupting the nation while doing so. This idiotic idea that farmers should be protected from every problem farming entails, and then they should also reap all the rewards when things go right is bad enough. The biofuels advocates go even further with this to just handing money over farmers for producing products no sane human wants. But never fear, the government will bribe people into buying it.

Yeah, i definitely want to bankrupt the nation, thats it, glad you cleared things up. You may be resorting to calling me an idiot, but you are the one who made the blanket statement about bio-fuels and all people who are in favor of them all advocating the same behavior.

One of us is making blanket statements filled with hyperbole and attacking the other.

One of us is pointing out that that blanket condemnation is ridiculous and the situation is more complex than the other is willing to admit.

Of the two, one of us might be an idiot, but based on those two statements I'm guessing its not me.

[Mad Max, Esquire]

Bio-fuel-

Produces lots of CO2. Takes lots of gasoline to grow. Is incredibly inefficient (both to produce and in terms of the actual horsepower it produces in the vehicle). And as far a ending our dependency on foreign sources, that's bull. If there is enough demand for bio-diesel, the U.S. will start importing grain to supplement it. Besides, most of our oil comes from Canada.

We need better hybrid technology which accomplishes what biofuel advocates are claiming biofuel does - efficiency. Hybrids should serve as a stop-gap until we have figured out a way to cost effectively deliver hydrogen fuel cell technology. In the interim, bio-diesel and liquid coal constitute an expensive and useless diversion driven by politics.

[Mad Max, Esquire]

Oh, and in terms of the Brazilian Miracle (where flex fuel is used widely), why do you think the Amazon forest is being plowed under to make farmland? Talk about environmental impact.

[Mike's brother Matt]

Okay, you nameless one, what part of taking my anti-biofuels statement as being oppossed to scientific research isn't an absurd generaliztion? I'm oppossed to them because I actually understand things like science and the real world. Where just because something comes from plants doesn't make it better for the planet. As for calling you an idiot, you are an idiot. I'm not going to sit here and pretend people with completely idiotic positions aren't idiots. The only way we're ever going to make progress on complex issues is to stop trying to please the idiots with thier non-sensical positions, and part of that is calling them out. A blanket condemnation is right when the entire underlying premise of what's being condemned is hopeless. I also have a blanket condemnation of faith healers. Does it really matter what faith they belong to as they pray that somehow they'll get better without medical treatment? No, because the entire idea's stupid. I'm sick and tired of being expected to play nice with the half-wits whose horrible judgement is what causes most of our problems. I'm not doubting your intentions about wanting to help the planet. But bio-fuels won't do it, and wishing they will just wastes time that could be used to actually do something that will help.

[Nameless One]

Making the blanket statement against biofuels because there are some limitations in the CURRENT technology is pretty easy to see as being opposed to scientific research.

There are potential benefits to bio-fuels and potential costs, I'd argue they are worth continuing to investigate, you want to stop looking all together because they aren't the immediate right solution right now.

By your thinking we should have given up on solar cells because of how inefficient they were initially. Now after years of research and refinement we have come to the point where they are efficient and relatively cheap.

I get a kick out of people on both sides of the political/ideological spectrum who assume that everything is all or nothing. Your with us or against us!

Guess what dude, there are positions and people who believe them in between the extreme ends of the spectrum.

I'm not going to sit here and pretend people with completely idiotic positions aren't idiots.

Yeah, a good way to convince people they are wrong and you are right is to call them idiots. Maybe you should climb down off your ivory tower and take a look at how arrogant and sanctimonious you are being. The internet has all this great promise to foster debate and exchange of ideas until people like you come along who are so full of yourself and so convinced you are 100% right that not only can you not even consider other ideas, but you have to belittle the people who disagree with you. Do you really expect people to take you seriously when you have an attitude like that? Whats the point of talking if all you are goign to do is stick your fingers in your ears and call people idiots? I mean really, why even bother to POST something.

You call me an idiot for my idiotic beliefs. Which ones would those be? The belief that you shouldn't make blanket statements about a subject, especially one you don't fully understand? Or the belief that just because a technology isn't perfect now means we should stop investigating and improving it.

My guess is you are upset because you got called out for an extremeist position by someone who was actually NOT the extremeist you thought them to be, and well, it made you look kinda dumb.

I highly doubt you'll actually admit you were wrong, and making such a grandiose statement was in fact incorrect. I doubt you'll back down on calling me an idiot either, but really if you are as smart and open minded as you think you are, you'll also be intellectually honest enough to realize you've been jumping to conclusions left and right, and jumping to the WRONG conclusions and come out and admit your mistake. Or you can continue acting in an arrogant, self-righteous manner, one in which you live in a world with all the answers and the rest of us are just poor fools.

[Mike]

Well, to take up what my brother's attempting to argue, but instead with tact:

The analogy you're attempting to draw between biofuels and solar cells is fundamentally flawed.

There are ways of managing to eke out enough energy from a few crops--of which corn is not one, nor is the switch grass that Bush likes to talk about--such that you can end up with more energy available in the ethanol at the delivery stations than it took to produce. Just barely, if you pick just the right crop and just the right environmental conditions. However, once you factor in the loss of carbon sequestration from previously unfarmed land given over to increased agricultural output, those saving evaporate, including the so-called Brazilian miracle, which is accelerating rainforest losses. You end up with significant habitat destruction (including such things as extinctions and loss of water purification) in addition to increased net carbon dioxide emissions. It also produces a higher demand on agricultural output, which is one of the major causes of an increase in food prices.

The other incredibly important factor in rising food prices is the rising economic power of China and India, where huge numbers of people are switching from a previously almost exclusively vegetarian diet (because that's all they could afford) to a diet with more meat and dairy in it, which require significantly more calories from feed than they yield under commercial production. There are indeed circumstances in which meat and milk production increase the calories available for people, but those are almost entirely low-density operations where the livestock feed on natural vegetation that humans are unable to subsist on, and which are the only things which will sustainably grow in that environment. Elk feeding on lichens, sheep browsing on alpine bushes, and that sort of thing. But that's a digression.

As he previously stated, running small-scale research operations to find more efficient crops or extraction methods would be very different than the biofuel subsidies currently in place. And doing that is what would be equivalent to continued research in solar cell efficiency and manufacture. Current biofuel subsidies are more akin to paying power companies to blanket national parks with inefficient solar panels. Except that blanketing national aprks with bad solar panels would actually be more beneficial to our energy policy than the current biofuel subsidies, because at least the solar panels would provide a net gain in electricity, unlike corn ethanol.

[Alasdair]

Mike - correct me if I have this wrong, please ...

Biofuels, particularly ethanol, suffer from the problem that methanol or ethanol are less 'energetic' than gasoline (which is higher octane) ... by volume, they provide less bang for the buck ... they also suffer from the problem that all sorts of things which contribute to creating them, from fertilisers to costs of processing and transportation also use energy ...

The Brazilian Miracle, energy-wise, exists mostly because they can get over 90% of their energy from Hydro-electric sources ... and that hydro-electric energy helps 'em make their fertilisers and move their stuff around without needing to use large amounts of fossil fuels ...

The biggest problem with Hydro-electric is that is is limited by relief/terrain - not many places work for hydro-electric - and it doesn't work worth diddly in places like Kansas or Antarctica, for example ...

Now, on the other hand, pebble-bed nuclear looks remarkably promising ... from what I have read so far, they have the size to be workable in localised areas ... small towns could have one ... city suburbs could each have one (if we can work out how to stop the Crips from stealing the pebbles to make glow-in-the-dark jewelry) ... with localised pebble-bed reactors, the significantly-decreased transmission distances make 'em even more effective ... negligible CO2 emissions involved with 'em ... what's not to like ?

[Nameless One]

Mike, you present a much better argument against the commercial use of bio-fuels, one I have no problem agreeing with and more importantly didn't already, of course thats not what your brother Matt actually said. Certainly if its what he meant to say he could have clarified it, instead he decided to simply start calling people idiots. In regards to bio-fuels in general it should be noted that there are options such as the use of waste oils from places like McDonald's that can (and are) used by people with diesel vehicles to run their cars. So they are taking something thats A) already been produced and used once and B) just going to be thrown out, and adding extra use to it, so in that case, Bio-Fuels are a good thing. As I argued earlier, blanket condemnation of bio-fuels is a bit ridiculous.