Some Knowledge

The price for food is increasing worldwide.  People have been killed in food riots in many countries triggered by the higher cost of food.  There are many factors involved in the higher prices.  The cost of energy necessary to grow and transport food has gone up.  There are diminished supplies of some grains due to bad weather.  Stockpiles of wheat are diminishing.  Even in developed countries like Italy, people have protested the higher prices.

Protests and riots will do nothing to lower the cost of food.  What is needed is more supply of grains and other staples.  To increase production, the world will have to focus more on growing food.  The diversion of food products to the production of biofuels is one of the causes of higher prices.  Any way you look at it, higher energy prices mean higher prices for food.

The market is what determines prices.  People speculate on food commodities.  This is like large scale hoarding, hoping that the price will increase, all to make money.  Speculation is just one of the things that drives market prices.  With supplies diminishing, prices will naturally increase.  This is why diamonds are so expensive.  If there were a lot of diamonds everywhere, they would be worthless.  The same principle applies to food.  The thing is, there is less food available.  The answer to this problem is to grow more food.  The problem with growing more food is that it costs more to grow the food.  The weather is also a factor.  Droughts drive up the price of food because there is less that survives.

Another factor driving up the price of food is the devaluation of currency.  Money tends to lose value over time.  Inflation is a factor in every economy.  It’s not just the dollar that’s losing purchasing power, it’s money in general.  Prices tend to increase over time.  An economic theory for why prices increase might be that they keep making more money, so the supply of money increases, so it has less value.

People need to eat to survive.  In any shortage or price increase, it is the poor people who will suffer first.  Possession of money has a survival value associated with it.  If you are wealthy you can afford the higher prices for things.  If you are broke, you could starve to death.  Whether this is fair or not is a question for philosophers.  The fact is that some people are more privileged than others because they have more money.  You don’t see people rioting over the high price of lobster.  Lobster has been very expensive for years.  You don’t see people protesting the high price of caviar.  Caviar is a luxury food.  If you can afford expensive foods, you are in no danger of starvation when the price of grain doubles, as it has.

What is the answer to the increasing cost of food?  I don’t necessarily think there is an answer.  People will probably have to work harder to survive.  Persons with access to land might want to plant gardens to grow some of their own food.  Even food you grow yourself costs some money.  It might be better to rely on grains and vegetables for your food, as these tend to cost less than meat, both in terms of price and cost of production.  People too poor to afford food will either have to find better lines of work, or will have to rely on government aid or humanitarian programs.  The age of abundance is coming to a close.  Unless some new, cheap energy source is found to drive our society, prices will continue to go up and more people will suffer.