As food commodity prices skyrocket, incapable Middle Eastern regimes topple in their wake. Is there a political solution? Siler Bryan thinks so.

Feeling the Pinch

With all the focus on political reform, religion and human rights, many commentators looking at recent developments in the Middle East have overlooked a more fundamental factor contributing to and in some cases instigating unrest in the region: the price of food.  The Tunisian revolution began last December with the humiliation of a local fruit vendor by a government official, followed by many who identified with him taking to the streets to protest their economic woes and treatment by the regime. Subsequent protests throughout the region have been linked not just to the desire for political rights among long oppressed people, but the dissatisfaction with the standard of living in the face of rising unemployment, stagnating wages, and increasing inflation.

The UN Food and Agriculture organization reports that the global food price index now stands at a record high, topping the 2008 levels that sparked riots in several developing countries at the beginning of that year. The current increase is not yet felt in the United States and other Western economies where the raw material represents only a fraction of the price of most supermarket items, but this rise in prices cuts deeply into the already thin margins that lie between families and hunger in much of the developing world. 

An Economic Phenomenon?

The current wave of inflation can be traced back to a number of historic policies, many of which were originally prescribed by US-led Western institutions like the World Bank and the IMF. Countries like Egypt that had long been producers of staple crops were encouraged in the 1970s and 80s to focus on producing goods for export while taking advantage of cheap grain from the US that could be imported for less, thus adhering to the Ricardian notion of comparative advantage. This served to develop profitable export industries while providing the US with a market for its excess grain that results from the use of advanced technology and government subsidies paid to major agribusinesses. However, the consequence of this policy was the dramatic disappearance of Egypt’s own agricultural industry, which could not compete with the cheap grain being imported, and in some cases received as aid, from the US. The move from near self-sufficiency to becoming one of the largest importers of wheat in the world left Egypt vulnerable to fluctuations of global food prices--a situation that became of major consequence with the recent spikes in prices worldwide.

Propelled by Global Warming?

The recent rise in food prices and the wave of protests that have followed it can also be closely correlated with a number of weather events that have left many of the world’s crops devastated or diminished. From floods in Australia to drought in Russia, to storms and fires in other key agricultural regions, global food supply is taking a hit from weather that many scientists say could be the first signs of global warming and its potentially pernicious influence over food production. Tracing back the supply chain from high prices in the supermarket shows the direct influence of adverse weather on food prices in 2011. According to Joe Romm at ClimateProgress.org, if the frequency and severity of these events continue as projected in the models forecasting climate change, then today’s spike in food prices could become the norm as reserves are depleted and countries scramble to prevent shortages from crop destroying weather phenomena.

A Political Solution?

Subsidizing the price of bread and other food staples has long been a practice of Arab regimes, designed to dissipate public dissatisfaction with the appearance of a caretaker state.  This practice that Tunisian academic Larbi Sadiki has termed “democracy of bread” extends only as far as governments are willing to offer cheap staples in order to quell protests or calls for deeper political reforms and it purposely avoids tackling greater structural issues and political reform. The bread subsidy has not proven to be a sustainable model; world prices make it increasingly expensive and expose its failure to solve economic problems other than saving consumers a small percent on groceries. Indeed unemployment has been one result of these subsidies as they have hobbled many countries’ agricultural sectors while failing to develop other industries that require similar quantities of labor.

In confronting the political unrest, governments in the Middle East have met with varying success. Food prices, along with unemployment, corruption, and a host of other political and social issues resulted in the expulsion of regimes in Egypt and Tunisia. In Jordan however, where a similar Day of Anger was organized and people took to the streets to protest rising food prices, the government responded with an arsenal of “reforms”, including subsidies on bread and fuel (The Guardian). These along with several cosmetic political changes essentially ended the protest movement, at least for the time being, leaving the regime intact.

Contrasting the revolutionary outcomes in Egypt and Tunisia, with the relative stability enjoyed by Jordan  illustrates the importance of context in determining what effect food prices and inflation of other commodities may have on the political situation in any given country. From the existence of political parties like the Muslim Brotherhood (banned in Egypt but co-opted by the regime in Jordan) to the method of distribution (Egypt’s subsidized bread is distributed to long lines from ovens operated by the military), many factors coalesce to determine the weight of increased staples in the milieu of the political arena. As a recent article in Foreign Affairs examines, food riots have a particular psychology that can often center around the denial of a basic right, or the perception of a humiliation (such as the case in Tunisia) more than the absolute cost increase passed on to the consumer. (The Psychology of Food Riots, Foreign Affairs, January 2011)

                  While the case of Jordan provides a successful example of managing food inflation within the existing political structure, macro events in weather or demand may raise prices dramatically in years to come. This has already garnered the attention of several of the rich Gulf States, whose desert climate impels them to import the vast majority of their food already. Countries like Saudi Arabia and Qatar have bought swaths of farmland in economically depressed countries like Ethiopia, where they intend to outsource their farming directly; sowing oil wealth as staple crops so as to own the means of production as global prices continue to climb. (New York Times Magazine November 2009)

The above examples illustrate the ability of some governments to provide for their food security into the future; while history has shown that inflation and food prices’ influence can play a hand in shoring up or toppling regimes. The recent protests have born this out but long term consequences will come down to who has the resources and foresight to plan for increasing volatility and the likelihood of continued disturbances in global production. Just as the era of cheap oil is passing so will the era of cheap food, the consequences of which will be of major importance to every country on our shrinking planet.