Archive for April 22nd, 2008

We Regret to Inform You…

Sharon April 22nd, 2008

When climate change and peak oil thinkers run out of other things to worry about, there’s always the endless, inevitable debates about whether we are facing a “fast crash” or a “slow grind.”  And I admit, I’m worried about my fellow environmentalists - because I think they are about to lose their favorite distraction.  When no one was looking, we got an answer.  Fast crash wins.  And we’re in it now.

Wait a minute, you argue - that’s not right.  If we were in a fast crash we’d be well on our way to living in a Kunstler novel.  But we’ve still got cars, we’ve got food, things are slowing down, but at worst this looks like a slow grind - but the crazy lady at the blog is saying fast crash?!?!?

Before you argue with me (and you are both welcome and encouraged to), I’d like to post something a bit out of my usual style - it is simply a description of what has happened with food and energy in the last year - that’s all it is.  Then tell me what you think - because it wasn’t until I began to write this introduction to the present food situation that I suddenly was struck by the fact that even a fast crash doesn’t always look fast when you live it - new normals arise and it turns out we assimilate faster than we panic.

So here we are - the “We regret to inform you that what you have imagined to be “civilization” is now falling apart” post.  See if it strikes you the way it struck me. 

I would also note two things.  The first is that the general political consensus is that neither the food nor energy crisis will do anything but grow more acute anytime soon - we’re really in the early stages.  And that this only covers the first 4 months of 2008.

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In early 2008, the world’s food and energy train came off the rails.  What was startling was that it didn’t happen either gradually or in a linear way - instead, things simply fell apart at an astounding rate, faster than anyone could have predicted without being accused of lunacy.

It started with biofuels and growing meat consumption rates.  They drove the price of staple grains up at astounding rates.  In 2007, overall inflation for food was at 18%, which created  a new class of hungry, but that was just the tip of the iceberg.  In 2008, the month to month inflation was higher than 2007′s annual inflation.  At that rate, the price of food overall was set to double every other year.  Rice, the staple of almost half the world’s population rose 147%, while wheat grew 25% in just one day.  Price rises were inequitable (as was everything else) so while rice prices rose 30% in rich world nations like the US, Haitian rice prices rose 300%.

Haiti was an early canary in the hunger coal mine.  Desperately poor, by early 2008, tens of thousands of impoverished Haitians were priced entirely out of the market for rice and other staples, and were reduced to eating “cookies” made of nutrient rich mud, vegetable shortening and salt to quiet their hunger pangs.  Women stood on the street, offering their children to any reasonably well fed passerby, saying “Please, pick, take one and feed them.”  Thousands of Haitians marched on Port Au Prince, yelling, “We’re hungry.”  And indeed, the Haitian government was complicit, allowing food relief to rot on the wharves. But Haiti was just the start. 

After riots over long bread lines threatened to destabilize Egypt, the Egyptian government set the army to baking bread for the hungry.  Forty nations either stopped exporting grains or raised tariffs to make costs prohibitive.  Food prices rose precipitiously as importing nations began to struggle to meet rising hunger.  The UN warned that 33 nations were in danger of destabilizing, and the list included major powers including Pakistan, Mexico, North Korea India, Egypt and South Africa.   Many of these hold nuclear weapons.

The crisis didn’t stop among the already-poor, however.  An article in The Economist reported that the crisis extended well into the middle class -  Joanna Sheeran, director of the World Food Project  explained, “For the middle classes,…it means cutting out medical care. For those on $2 a day, it means cutting out meat and taking the 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.”  

Up to 100 million people who had managed to raise their incomes above $2 a day found themselves inexorably drawn back to the world poverty level, while millions of those who called themselves “middle class” began, slowly, to realize that they were no such thing.  Reports noted that many of the supposed middle class in rich world nations were actually the working poor who had overextended their credit to keep up appearances.  And the appearances - and credit access - were fraying

In 2007, a major American newspaper reported the growing problem of seasonal malnutrition affecting poor children in the Northern US - the rising price of heating oil meant that lower class families were struggling to put on the table.  Hungry, low weight children were unable to maintain their body temperature in chilly houses, and a vicious circle of illness, hunger and desperation ensued.  Malnutrition bellies began to be regularly seen by pediatricians treating the urban poor in cold climates.

Shortages were a chronic problem in the poor world, but by early spring of 2008, they began to arrive in the rich world - despite Japan’s deep pockets, a shortage of butter and wheat reminded the rich world of its dependence on food import.   Many of the supply problems were due to climate change and energy issues, as Australian dairy farmers struggled with high grain prices and the extended drought that destroyed their pastures. 

Following up on anecdotal reports of limits at bulk warehouse stores, in late April of 2008 rationing went official. Many Costco stores were limiting purchases of flour, rice, cooking oil and other staples to avoid shortages - and the stores tracked purchases electronically to prevent customers from visiting other Costco stores.  This was the first example of food rationing, but probably not the last - at least one financial analyst was predicting corn shortages in the fall of 2008.

The energy train and the food train were inextricably linked, and indeed directly (as the costs of diesel rose rapidly) and indirectly (rising energy costs created the biofuels boom) drove the food crisis.    They were linked in other, complex ways as well - the housing collapse that threatened to plunge Europe and the US into a  major depression was in part due to the high costs of commuting from suburban infrastructure.  Exurban housing collapsed hardest, while housing closer to cities remained desirable - for a while.

While the food crisis in the poor world made headlines, the energy crisis there went almost unnoticed.  <ore and more poorer nations simply could not afford to import oil and other fossil fuels, and began to slowly but steadily lose the benefits of fossil fuels.  Nations suffered shortages of gas, electricity and coal.  Tajikistan, experiencing a record cold winter found itself with inadequate supplies of heating oil and a humanitarian crisis.  South African coal supplies were so short that electricity generation dropped back to intermittency.

Industrial agriculture, described as “the process of turning oil into food” began to struggle to keep yields up to match growing demand.  Yield increases fell back steadily, with more and more investment of energy (and higher costs for poor farmers trying to keep yields up).  Yield increases, which had been at 6% annually from the 1960s through the 1990s fell to 1-2%, against rapidly rising demand.  Climate change threatened to further reduce yields in already stressed poor nations - Bangladesh struggled with repeated climate change linked flooding, the Sahelian African countries with growing drought, China with desertification. 

All future indications were that both food and energy supplies would fail to keep up with demand. Unchecked (the only kind we’ve got) climate change is expected to reduce rice yields by up to 30%, and food production in the already starving Sahel is expected to be reduced by half.  GMOs, touted as a solution, have yet to produce even slightly higher yields.  Arable land is disappearing under growth, while aquifers are heavily depleted - 30% of the world’s grain production comes from irrigated land that is expected to lose its water supply in the next decades.

Meanwhile the costs of fossil fueled agricultural skyrocketed, with Potash rising by 300% in less than a year.  What should have been a boom for farmers was actually the beginning of an increasingly precarious spiral of high prices, high indebtedness and market volatility.  Agricultural indebtedness rose dramatically.

Meanwhile, the ability of nations to transport food supplies began to be called into question.  Early trucker protests were intermittent and largely ineffective, but real predictions of diesel shortages and a shortage of refining capacity made it a real possibility that food might not reach store shelves. 

 And so how does the story end?  If you were reading this in a history book, what ending would you expect to see?  Because just because the crash doesn’t quite read like a post apocalyptic novel doesn’t mean that we aren’t the new Po-Apoc (like Po-Mo, only darker) generation.

Sharon