Why is there rampant famine in the 21st century and how can it be eradicated?

6 May 2009 by Eric Toussaint , Damien Millet


How can we explain the fact that famine still exists in the 21st century ? One person in seven on this planet is permanently hungry.

The causes are well known: a profound injustice in the distribution of wealth and the monopolizing of land by a small minority of large landowners. According to the FAO [1], 963 million people were suffering from famine in 2008. Paradoxically, these people mainly live in rural areas. They are generally farmers who do not own land or do not own enough, and are without the means to cultivate it effectively.

What caused the food crisis of 2007-2008 ?

It is important to emphasize that in 2007-2008, the number of people suffering from hunger increased by 140 million. This marked increase is due to the explosion of food prices [2]. In several countries retail food prices increased by as much as 50%, or even more.

Why such an increase? To answer this question, it is important to understand what has been happening over the past three years. Only then can alternative, appropriate policies be implemented.

On the one hand, the public authorities in the North increased their aid and subsidies for agro-fuels (mistakenly referred to as bio-fuels, since there is nothing organic about them). All of a sudden, it became profitable to replace subsistence crops with oleaginous crops or feed grains, or to divert part of grain cultivation (corn, wheat, etc.) towards the production of agro-fuels.

On the other hand, after the real estate bubble burst in the United States, with repercussions throughout the rest of the world, the major investors (pension funds Pension Fund
Pension Funds
Pension funds: investment funds that manage capitalized retirement schemes, they are funded by the employees of one or several companies paying-into the scheme which, often, is also partially funded by the employers. The objective is to pay the pensions of the employees that take part in the scheme. They manage very big amounts of money that are usually invested on the stock markets or financial markets.
, investment banks, hedge funds Hedge funds Unlisted investment funds that exist for purposes of speculation and that seek high returns, make liberal use of derivatives, especially options, and frequently make use of leverage. The main hedge funds are independent of banks, although banks frequently have their own hedge funds. Hedge funds come under the category of shadow banking. , etc.) shifted their focus and speculated on the futures market Futures market A market on which a product (financial instrument, currency, merchandise) is purchased or sold with payment and delivery postponed until a later date than the initial transaction which determined the price. where contracts for food prices are negotiated (there are three main futures Futures A futures contract is a standardized advance commitment, negotiated on an organized futures market, to deliver a specified quantity of a precisely defined underlying asset at a specified time – the ‘delivery date’ – and place. Futures contracts are the most widely traded financial instruments in the world. exchanges in the United States: Chicago, Kansas City and Minneapolis). It is therefore urgent for citizens to take action to legally ban speculation on food prices. Despite the fact that speculation reached its peak and declined from the middle of 2008, and that futures prices have plummeted, retail prices have not followed suit. The vast majority of the world’s population has a very low income and is still affected by the dramatic consequences of the increase in food prices of 2007-2008. The tens of millions of redundancies announced for 2009-2010 around the world will further worsen the situation. In April 2009, the FAO told the G8 G8 Group composed of the most powerful countries of the planet: Canada, France, Germany, Italy, Japan, the UK and the USA, with Russia a full member since June 2002. Their heads of state meet annually, usually in June or July. that the number of chronically hungry people was set to rise by 75 million to 100 million this year, bringing the total number to more than 1 billion. In order to counter this situation, public authorities must keep food prices under control.

The increase in famine throughout the world is not due, at least for the moment, to climate change. But this factor will have very negative consequences for the future in terms of production in certain regions of the world, especially in tropical or subtropical areas. Agricultural production in temperate zones should be less affected. The solution lies in radical action being taken so as to drastically reduce the emission of greenhouse gases (the IPPC [3] recommends an 80% reduction of emissions for the most industrialized countries and 20% for the others).

Is it possible to eradicate famine?

Eradicating famine is entirely possible. The basic solutions needed in order to reach this vital goal lie in policies of food sovereignty and agrarian reform. That is to say, feeding populations based on local production, whilst limiting imports and exports.

Food sovereignty needs to be the focal point of governments’ political decisions. They need to concentrate on family farms, using techniques designed for the production of organic food. Furthermore, this would enable people to have good quality foodstuffs: no GMOs, no pesiticides, no herbicides and no chemical fertilizers. However, to achieve this goal, 2 billion farmers need to have access to sufficient land to work on, and to work for themselves, as opposed to producing wealth for the big landowners, agro-business multinationals and large retailers. Through public aid, these people should be given the means available to cultivate their land without depleting it.

In order to do this, an agrarian reform is needed. A reform which is desperately lacking, be it in Brazil, Bolivia, Paraguay, Peru, Asia or in certain countries in Africa. Such an agrarian reform must address the redistribution of land, banning large private landowners and providing public aid for farmers.

It should also be stressed that the IMF IMF
International Monetary Fund
Along with the World Bank, the IMF was founded on the day the Bretton Woods Agreements were signed. Its first mission was to support the new system of standard exchange rates.

When the Bretton Wood fixed rates system came to an end in 1971, the main function of the IMF became that of being both policeman and fireman for global capital: it acts as policeman when it enforces its Structural Adjustment Policies and as fireman when it steps in to help out governments in risk of defaulting on debt repayments.

As for the World Bank, a weighted voting system operates: depending on the amount paid as contribution by each member state. 85% of the votes is required to modify the IMF Charter (which means that the USA with 17,68% % of the votes has a de facto veto on any change).

The institution is dominated by five countries: the United States (16,74%), Japan (6,23%), Germany (5,81%), France (4,29%) and the UK (4,29%).
The other 183 member countries are divided into groups led by one country. The most important one (6,57% of the votes) is led by Belgium. The least important group of countries (1,55% of the votes) is led by Gabon and brings together African countries.

http://imf.org
and, above all, the World Bank World Bank
WB
The World Bank was founded as part of the new international monetary system set up at Bretton Woods in 1944. Its capital is provided by member states’ contributions and loans on the international money markets. It financed public and private projects in Third World and East European countries.

It consists of several closely associated institutions, among which :

1. The International Bank for Reconstruction and Development (IBRD, 189 members in 2017), which provides loans in productive sectors such as farming or energy ;

2. The International Development Association (IDA, 159 members in 1997), which provides less advanced countries with long-term loans (35-40 years) at very low interest (1%) ;

3. The International Finance Corporation (IFC), which provides both loan and equity finance for business ventures in developing countries.

As Third World Debt gets worse, the World Bank (along with the IMF) tends to adopt a macro-economic perspective. For instance, it enforces adjustment policies that are intended to balance heavily indebted countries’ payments. The World Bank advises those countries that have to undergo the IMF’s therapy on such matters as how to reduce budget deficits, round up savings, enduce foreign investors to settle within their borders, or free prices and exchange rates.

are largely responsible for the food crisis since they recommended that the governments of the South stop maintaining grain silos which have been used to feed the domestic market in case of shortages or steep price increases. The World bank and the IMF encouraged the governments of the South to cut the public credit agencies for farmers and drove them into the clutches of private lenders (often large traders) or private banks exacting exorbitant rates. This left many small farmers in debt, in India, Nicaragua, Mexico, Egypt and several countries in Sub-Saharan Africa. According to official studies, the high level of debt among Indian farmers has been the main cause of suicide of 150,000 farmers in India over the past decade. This is a country where the World Bank has successfully persuaded the authorities to suppress public credit agencies for farmers. And that is not all: over the past 40 years, the World Bank and the IMF also coerced tropical countries to reduce wheat, rice and corn production and replace them with export crops (cocoa, coffee, tea, bananas, peanuts, flowers, etc.). Finally, to crown their efforts in favour of big agro-businesses and major grain exporting countries (beginning with the United States, Canada and Western Europe), they also persuaded governments to open their borders to food imports which benefit from massive subsidies from governments in the North. This led to many producers in the South going bankrupt and also to a severe reduction in local subsistence crop production.

To summarize, it is necessary to ensure food security and implement agrarian reform. The production of industrial agro-fuels must be abandoned and public subsidies for those who produce such fuels should be withdrawn. It is also necessary to rebuild public food reserves in the South (especially cereals such as rice, wheat, corn...), re-establish public credit agencies for farmers and food price regulation. People who earn a low wage must be ensured access to quality food at a low price. The State must also guarantee that small agricultural producers can sell at prices high enough to allow them to noticeably improve their living conditions. The State must also develop public services in rural areas (health, education, communication, culture, public seed “banks”, etc.). Public authorities are perfectly capable of guaranteeing both subsidized food prices for consumers and retail prices high enough to provide small producers with an adequate income.

Is this fight against famine not part of a much greater battle?

One cannot expect to seriously fight famine without combating the fundamental causes of the current situation. Debt is one of these causes. The publicity and fanfare around the issue, especially in recent years at the G8 or G20 G20 The Group of Twenty (G20 or G-20) is a group made up of nineteen countries and the European Union whose ministers, central-bank directors and heads of state meet regularly. It was created in 1999 after the series of financial crises in the 1990s. Its aim is to encourage international consultation on the principle of broadening dialogue in keeping with the growing economic importance of a certain number of countries. Its members are Argentina, Australia, Brazil, Canada, China, France, Germany, Italy, India, Indonesia, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, USA, UK and the European Union (represented by the presidents of the Council and of the European Central Bank). summits, has failed to pull the veil over this persistent problem. The current global crisis is further worsening the situation in developing countries faced with the cost of debt, and new debt crises in the South are due to emerge. The debt has led people of the South, so often rich in terms of human and natural resources, to general impoverishment. Debt is organized pillage and must urgently be stopped.

In fact, this infernal public debt mechanism is a main obstacle to fulfilling people’s basic human needs, including the right to decent food. Without a doubt, the fulfilment of basic human needs must be placed above any other considerations, be they geopolitical or financial. From a moral perspective, the rights of creditors, people of private means or speculators have little weight compared to the fundamental rights of 6 billion citizens crushed by the implacable mechanism of debt.

It is immoral to ask countries, impoverished by a global crisis for which they are not at all responsible, to earmark a large part of their resources to repaying wealthy creditors (whether from the North or the South), instead of securing their basic needs. The immoral nature of the debt also stems from the fact that this debt was very often contracted by non democratic regimes who did not use the sums of money they received in the interests of their own population and often embezzled vast amounts, with the tacit or active approval of the States of the North, the World Bank and the IMF. The creditors of the most industrialized countries granted loans while being fully aware of the fact that the regimes were often corrupt. They are therefore in no position to demand that the people of these countries pay back a debt which is both immoral and illegal.

To sum up, debt is the one of the main mechanisms through which a new form of colonization operates, to the detriment of the people. This is in addition to the historic injustices perpetrated by rich countries: slavery, extermination of indigenous populations, colonial shackles, pillaging of raw materials, biodiversity and the know-how of farmers (through the patenting of agricultural products of the South, such as Indian basmati rice, for the profit Profit The positive gain yielded from a company’s activity. Net profit is profit after tax. Distributable profit is the part of the net profit which can be distributed to the shareholders. of multinational agro-businesses in the North), the pillage of cultural goods, the brain drain etc. In the name of justice, it is time to replace the logic of domination with a logic based on the redistribution of wealth.

The G8, the IMF, the World Bank and the Paris Club Paris Club This group of lender States was founded in 1956 and specializes in dealing with non-payment by developing countries.

impose their own truth, their own justice, to which they are both judge and party. Faced with the crisis, the G20 has taken up the baton and is trying to place a discredited IMF at the centre of the political and economic playing field. We must put an end to an injustice which profits oppressors, whether from the North or South.

Éric Toussaint, a doctor in political science, is president of the Committee for the Abolition of Third World Debt, Belgium www.cadtm.org), author of A Diagnosis of Emerging Global Crisis and Alternatives, Mumbai, India, Vikas Adhyayan Kendra, 2009, 139p.; The World Bank: A Critical Primer, London, UK, Pluto Press, 2008.

Damien Millet, mathematician, is spokeperson for CADTM France (Committee for the Abolition of Third World Debt).

Joint authors of 60 Questions 60 Réponses sur la dette, le FMI et la Banque Mondiale, CADTM-Syllepse, Liège-Paris, 2008. English version to be published in 2009.

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Translated by Francesca Denley in collaboration with Judith Harris

Footnotes

[2See Eric Toussaint and Damien Millet, “Why a world food crisis? (yet again)”, 2008, . See also Éric Toussaint, “Getting to the root causes of the food crisis

[3Intergovernmental Panel on Climate Change, see

Eric Toussaint

is a historian and political scientist who completed his Ph.D. at the universities of Paris VIII and Liège, is the spokesperson of the CADTM International, and sits on the Scientific Council of ATTAC France.
He is the author of Bankocracy (2015); The Life and Crimes of an Exemplary Man (2014); Glance in the Rear View Mirror. Neoliberal Ideology From its Origins to the Present, Haymarket books, Chicago, 2012 (see here), etc.
See his bibliography: https://en.wikipedia.org/wiki/%C3%89ric_Toussaint
He co-authored World debt figures 2015 with Pierre Gottiniaux, Daniel Munevar and Antonio Sanabria (2015); and with Damien Millet Debt, the IMF, and the World Bank: Sixty Questions, Sixty Answers, Monthly Review Books, New York, 2010. Since the 4th April 2015 he is the scientific coordinator of the Greek Truth Commission on Public Debt.

Damien Millet

professeur de mathématiques en classes préparatoires scientifiques à Orléans, porte-parole du CADTM France (Comité pour l’Annulation de la Dette du Tiers Monde), auteur de L’Afrique sans dette (CADTM-Syllepse, 2005), co-auteur avec Frédéric Chauvreau des bandes dessinées Dette odieuse (CADTM-Syllepse, 2006) et Le système Dette (CADTM-Syllepse, 2009), co-auteur avec Eric Toussaint du livre Les tsunamis de la dette (CADTM-Syllepse, 2005), co-auteur avec François Mauger de La Jamaïque dans l’étau du FMI (L’esprit frappeur, 2004).

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