Vol.2 No.26, 28 September 2002
Food Security Needs a Paradigm Shift
By Margaret Legum
The rise in food prices is a real emergency for millions of South Africans. Malnutrition, already widespread, becomes starvation when food prices rise by some 20% annually. If this starvation had had ‘natural’ causes like drought or flood, we would surely have taken emergency measures. But because we produce plenty of food in South Africa – and the famine is caused by the operation of ‘the market’ - we are not treating it as the emergency that it is.
The Cabinet met to discuss the problem, and announced they are looking at a number of measures, but will not interfere with the operation of ‘the market’. It is like saying we are losing water because the pipes are leaking, and we will find ways of stopping water loss without mending the pipes.
Like a bird immobilised by the gaze of a snake, our financial and economic establishment seems paralysed by the injunctions of ‘the market’. It is not only the government. They operate in a media and financial environment, local and international, that constantly warns against any measures involving regulating our economy to suit our own needs as a developing country with millions of unemployed people. The only exception is the amazing Pauline conversion of the Democratic Party – which, having salaamed to market forces since its inception, now discovers in anti-Mboweni monetarism a weapon to attack the government.
The lodestar of the market forces argument is trade – trade in everything. This is assumed to have no effects other than to create competition and thus reduce prices. So it is not surprising that the favoured solution to the food price emergency is to reduce tariffs on food. The only useful result would be to end local sharks exploiting shortages by charging extortionist prices.
But food shortages, hence price rises, have much deeper causes. First, imported inflation is the result of oil prices; and this is outside our control. But second, our under-valued currency is the result of perception-based speculation by foreigners; and the government can influence that. It can limit the amount and the manner in which our currency can be traded. It can regulate our currency exchanges, just as many other developed countries have done. It can refuse to accede to foreign demands for untrammelled access to our currency. Our obedience in that respect has brought us nothing but grief.
Even the business media has recognised the role of our currency collapse. But their solution is profoundly undemocratic. They suggest that our government should adopt policies – on crime, on HIV, on Zimbabwe, on privatisation, on trade access and so on – to please the foreign interests that constitute ‘the markets’. Some of the policies they advocate are directly contributing to the woes of our economy. COSATU, and a wide swath of civil society who deal daily with poverty and its effects on people, oppose them. Our government should be able to adopt policies in response to these democratic forces, rather than market forces.
Consider, for instance, trade. Since our liberation we have obediently offered our markets to trade from abroad. No one doubts that has created unemployment. If it has reduced prices for some consumer goods, what is the use of that to people without income? Would you rather have a job and slightly higher prices, or no job and a tickey off the tackies on the streets? One thing is clear: Americans and British and French and Japanese people would rather have a job, and that is why their governments are refusing to drop their tariffs on our exports. And all our fury and pleading and righteous indignation will not change that. They are responsible to their own people, and will not put our interests before theirs.
Of course trade is necessary and desirable if it is regulated to suit ourselves. But it is not the engine of growth. And governments can and should regulate it so that we enter the world’s markets how and when we are ready to do so – just as all rich and powerful countries do.
In particular we should beware of the current ‘Greeks bearing gifts’ in the form of the new American proposal for a ‘free trade accord’. Cameron Hume, US Ambassador, tells us his government wants to extend the present African Growth and Opportunities Act to full blown free trade. That means that whereas the Americans currently allow some of our exports in there tariff-free, they now want their pound of flesh. We must do the same. We, and the rest of the SA customs union, should accept their free trade accord. Guess who would benefit most from all-out free trade with the US.
Ambassador Hume says this would place us in ‘an exclusive club’. It would also have political advantages, he says. ‘It speaks volumes about what the US feels about its interests in southern Africa’, adding that it would ‘solidify’ our relations with the US. Perhaps we should consult with the people in Latin America, whose harnessing to the US economy through the North American Free Trade Area, has hardly produced trouble-free economies. Personally, the thought of ‘solidifying’ our economy with that of the US gives me the creeps.
Our government should stop handing over its responsibilities to ‘the markets’. In particular we should acknowledge that food security, and indeed agriculture as a whole, is a special case. We should grow food for local consumption, and trade only in the surplus. We should aim for self-sufficiency in food. Agriculture everywhere needs subsidy. Apart from its vulnerability to the weather, it requires long-term investment. You cannot switch from beef to peas overnight. That is why all rich countries subsidise agriculture
Traded food is essentially inferior food; and its travel highly polluting through fuel emissions. The skies and the highways are now criss-crossed by fruit which has been picked unripe, frozen, injected to ripen it, and ends up tasteless and textureless, if not actually poisoned. Or it has been genetically modified, grown in vast bulk, using toxic chemicals, and stored to take advantage of dollar-denominated markets. The land that could be used to feed local people has been depleted of its population and monopolised. Food is being treated as a commodity like shoes or radios. It is not. Feeding people is more important than anything else.
Since we are still in the business of traded food, the government must now bite the bullet and subsidise food. The millions of unemployed and poorly paid South Africans now need affordable food. Reducing tariffs on food offers only a temporary solution at the expense of putting our own farmers in danger. And they are the hope for self-sufficiency in the long run.
© South African New Economics Network 2006. Page generated at 17:15; 24 September 2006