Food security

The New York Times had a recent article on "agro-imperialism" and the alleged problem of food insecurity which plagues a number of countries. Some of the countries which suffer from this malady have begun looking to purchase tracts of land in other countries to assure their self-sufficiency. One such example is Saudi Arabia:

Dr. Robert Zeigler, an eminent American botanist, flew to Saudi Arabia in March for a series of high-level discussions about the future of the kingdom’s food supply. Saudi leaders were frightened: heavily dependent on imports, they had seen the price of rice and wheat, their dietary staples, fluctuate violently on the world market over the previous three years, at one point doubling in just a few months. The Saudis, rich in oil money but poor in arable land, were groping for a strategy to ensure that they could continue to meet the appetites of a growing population, and they wanted Zeigler’s expertise.

There are basically two ways to increase the supply of food: find new fields to plant or invent ways to multiply what existing ones yield. Zeigler runs the International Rice Research Institute, which is devoted to the latter course, employing science to expand the size of harvests. During the so-called Green Revolution of the 1960s, the institute’s laboratory developed “miracle rice,” a high-yielding strain that has been credited with saving millions of people from famine. Zeigler went to Saudi Arabia hoping that the wealthy kingdom might offer money for the basic research that leads to such technological breakthroughs. Instead, to his surprise, he discovered that the Saudis wanted to attack the problem from the opposite direction. They were looking for land.

In a series of meetings, Saudi government officials, bankers and agribusiness executives told an institute delegation led by Zeigler that they intended to spend billions of dollars to establish plantations to produce rice and other staple crops in African nations like Mali, Senegal, Sudan and Ethiopia.

I suspect the Saudis have elected to pursue this mercantilist approach for at least two reasons:

• Saudi Arabia has a lot of oil, views it as a strategic resource, and has a vast government apparatus to dictate its use. Food is viewed through a similar lens. Anything important must be controlled by the government.

• Saudi Arabia's government is simply massive (the private sector only accounts for 40 percent of GDP) and there are a lot of bored bureaucrats looking for new ways to justify their existence and exert control.

Coincidentally I suffer from a similar problem as the Saudis. The amount of land I rent is insufficient to feed me. In fact, I can barely get grass to grow in large patches of the backyard. One solution would be for me to venture to the suburbs and purchase some arable land in order to grow enough food to meet my requirements. The other is to walk around the corner to the grocery store and buy what I need. You can guess which approach I have opted for.

This isn't a silly analogy. Switzerland's agricultural sector only produces 60 percent of the country's food requirements. Does that mean the Swiss are engaged in a constant struggle against hunger? Is starvation only a bad harvest away? Of course not. The Swiss keep producing watches, chocolate and bank accounts while purchasing what food they need elsewhere.

Like government adventures in the energy sector around the world, I suspect that intervention and central planning in agriculture will end poorly. In fact, it appears the Saudis have suffered from some previous misadventures:

In the 1970s, worries about the stability of the global food supply inspired the Saudi government to grow wheat through intensive irrigation. Between 1980 and 1999, according to a study by Elie Elhadj, a banker and historian, the Saudis pumped 300 billion cubic meters of water into their desert. By the early 1990s, the kingdom had managed to become the world’s sixth-largest wheat exporter. But then its leaders started paying attention to the warnings of environmentalists, who pointed out that irrigation was draining a nonreplenishable supply of underground freshwater. Saudi Arabia now plans to phase out wheat production by 2016, which is one reason it’s looking to other countries to fill its food needs.

There is a very simple solution for assuring the world's population has sufficient access to food in the years to come, and it has nothing to do with vast government programs or central planning. Quite simply the world requires a greater reliance on capitalism and free markets. It is no coincidence that Ethiopia, a poster child of hunger in the 1980s, prohibits the ownership of land (licenses must instead be obtained from the government to farm the land). Where free markets are established bounty is produced and famine unknown.

While perhaps not nearly as fun or exciting as planning an economy, it represents the only way forward.