|Home | Advisory Board & Executives | Case Studies | Journal | Contact|
Montrose Journal Summer 08
WAS MALTHUS RIGHT? WON’T WE BE ABLE TO FEED OURSELVES? -CHRISTOPHER HASKINS
For two centuries, economists and scientists have derided the grim prognostications of Thomas Malthus. Writing at the end of a century that had seen an unprecedented tripling of the population, the English economist warned that the human race might grow faster than the ability of the earth to sustain it. However, as subsequent economists have pointed out, the very pressures of population on food supply spurred innovations in agriculture and science that increased the supply of food. Reverend Malthus’s gloomy assessment was undone by the conversion into crop production of virgin lands in the Americas and Australasia, and by the innovative skills of plant scientists, chemists and agricultural engineers in raising yields and providing machinery to cultivate and farm the new land. In fact, until recent years, the price of food has been declining – both compared to other prices, and, in some cases, even in nominal terms. The received wisdom was that Malthus was plain wrong.
Climate changeClimate change is the new worry. There are three aspects to this, all of which reduce food production. First, climate change is believed to be the cause of the more frequent occurrence of ‘extreme’ weather such as floods and droughts that reduce farming output. At the same time, governments are subsidising renewable energy crops at the expense of food, to reduce the reliance on often imported gas, coal and oil, and because such fuels are seen, sometimes questionably, as being more environmentally friendly. Finally, the destruction of tropical forests to bring more land into food production is being outlawed as a result of environmental consequences.
But this is all happening at a time when rising population is increasing the demand for food. The world’s population is forecast to rise from 6.5 billion to 9 billion by 2050 – around 40%. In the same period, as people become more prosperous and eat more food, consumption is expected to double. Moreover, food production is predicted to require more land as demand for meat – seen as a luxury in the developing world – rises. It takes more than five tonnes of vegetable protein to produce one tonne of meat.
Similarly, urbanisation is on the rise as population increases, and the proportion of the world’s population living in cities recently surpassed 50% for the first time in human history. Today, farming absorbs 70% of rainfall on land but soaring urban populations are already diverting water away from agriculture at a time when supplies are becoming more erratic and unpredictable.
At the same time, water shortage will be the greatest difficulty created by climate change. If, as seems likely, rain will fall more erratically in future—with very wet winters, followed by dry summers and intermittent monsoons—then there will have to be heavy investment in reservoirs and other means of storage. But most of this water will be diverted to the growing cities of the world. Californian cities are already buying water from farmers who had been using it to irrigate their crops. Farmers and citizens alike must learn to use water more efficiently. Market measures, like full economic pricing, will persuade them to do so.
In the laboratories of the world, scientists are busy developing plants that are more resistant to drought. Genetic modification is a crucial part of this work. So far farmers in the developing world have been slow to take up scientific innovations as a result of cost and because their farms are often too small to make such steps viable. If the massive uplift in food prices is sustained, these poorer farmers will be able to acquire the plants, chemicals, animal medicines and machinery that have transformed yields and outputs elsewhere.
But in order to take full advantage of large, automated equipment, farms in the developing world either need to get bigger (and fewer) or cooperate with each other to share the assets. Many non-governmental organisations (NGOs) argue that a status quo – built around millions of small farmers – is viable. It is not, for two reasons. Such a system simply does not and will not produce enough food for the population increases that are already occurring. And farmers themselves are fleeing subsistence-type existences to what they see as a better future in towns and cities. Increasing the production of food in the developing world, though, is not enough. A staggering proportion of the food grown in the developing world – some 40% in India, for example, does not make it from farm to table. Poor facilities exist for forecasting and offsetting the effects of bad weather. Storage facilities are often limited or non-existent. And often the food rots en route to market. Higher prices will stimulate such investment.
Government policiesThe long history of government protectionism during the years of surplus is unforgivable in times of shortage. Climate change, while severely damaging food production in large areas of the world – North Africa, the Mediterranean, Australia, many parts of the United States – will boost production in others – Siberia, Canada, Southern Brazil, and parts of Central Africa. Governments must ensure that food moves freely and efficiently from those areas in surplus to those in deficit. Unfortunately several countries, including Russia, Argentina and India, have responded to the current food crisis by restricting food exports to keep domestic prices down. And the outlook is not good in the US, traditionally the bastion of free trade. While seeking the Democratic nomination for the American presidency, both Barack Obama and Hillary Clinton made protectionist noises at a time when the world needs more, rather than less, free trade.
True free trade embraces the free movement of people as well as of goods. If we want to mitigate the effect of food shortages, there will have to be substantial two way migration, of both people and capital. Climate change means that the richer countries of the northern hemisphere will enjoy a climate that makes farming more productive, but will lack the indigenous workers to harvest the crops. These jobs are increasingly filled by migrants and this trend must be allowed to continue.
Food, fuel and consumptionThree arguments have been adduced to support subsidies for bio-fuels. They are claimed to be much less damaging to the environment than fossil fuels. They are designed to reduce the dependency on imports of oil from unstable and unfriendly countries. Finally, they are a more popular way of justifying subsidies for farmers. But all three arguments are flawed. The environmental benefits of many of these crops are suspect as the fossil fuels needed to cultivate, grow and harvest them offset most of the benefits. Moreover, rain forests may be cut down in order to produce the most effective source of bio-fuels: cane sugar (although a new generation of bio-fuels may be more effective than existing products). The security argument, too, is limited. A tiny proportion of imports can be replaced by renewable energy crops and this fuel security is being purchased at the risk of a more dangerous source of insecurity: food shortages.
However, by far the biggest villains in the piece – in creating the crisis of climate change and possible food shortages – are consumers in the affluent world. Our profligate behaviour means we use far more energy than we need, and buy far more food than is good for us – perhaps as much as 20% too much. Our often meat-based diet requires much more land than does the mainly vegetarian diet of the developing world. Worse still, we throw away vast quantities of good food, in restaurants and our own kitchens, because we order more than we can consume and cannot be bothered to make further meals from our leftovers. If the affluent consumers of the world reduced purchases by a third, we would increase the world’s food reserves substantially, perhaps by as much as 10%.
It is clear that much can be done to avert a global food crisis – improving the productivity of poor farmers, investing in responsible scientific research, promoting more global trade, rethinking bio-fuel policies, conserving and wasting less. But if these objectives are to be achieved we must not allow the well-intentioned affluent, ‘ethical food’ lobby to dominate the debate. A rural status quo, based on a protectionist organic system, if applied globally, would result in economic and political catastrophe. Then, Reverend Malthus’s predictions would indeed come to pass.
Lord Haskins of Skidby chaired Northern Foods and the Better Regulation Taskforce.
|Home | Advisory Board | Case Studies | Journal | Contact © 2003-2018 Montrose Associates. All rights reserved.|