The Down Range Forum
Member Section => Politics & RKBA => Topic started by: twyacht on January 31, 2011, 06:15:25 PM
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http://www.americanthinker.com/2011/01/america_and_the_middle_east_fo.html
January 31, 2011
America and the Middle East Food Riots
By Steve McCann
Perhaps the most over used but most accurate term used to describe the policies and ideology of the American Left is the "Law of Unintended Consequences." There is virtually nothing that these people espouse that once put in place has not had detrimental effects on either the people of the United States or the world.
Today there is a global food shortage and sky-rocketing prices. This has become the underlying factor in the riots in Tunisia, Algeria and Egypt, where up to 56% of a person's income is dedicated to the acquisition of food. These riots are now leading to the upheaval of governments and the very real possibility of the ascendancy of the radical elements into control.
While bad weather in various parts of the world is an element of the accelerating food prices there are two other factors directly related to the United States and its policies.
First, because of the enormous deficts run up by Obama administration and the Democrat controlled Congress, the Federal Reserve has had to effectively print trillions of dollars which have flooded the global market. Commodities are priced in dollars, consequently emerging markets throughout the world, and the food sector in particular, are suffering from rapidly rising inflation.
The CRB food index is up an incredible 36% over last year. Raw materials are up 23%. Since 2009 the dollar has declined by over 13% against the Japanese Yen and 25% against the Canadian dollar.
Larry Kudlow in the National Review writes in regard to the riots in Africa and the Middle-East:
So I have to ask this tough question: Is Ben Bernanke's ultra-easy QE2 money-priming partially to blame.
But food riots in the North Africa/Middle East area are bumping smack into long-time resentment over autocratic government. If food is in fact the trigger for what may be a revolution in Egypt, then US monetary policy has to shoulder at least some of the blame.
An example of this inflation is in the price of wheat. The January 2011 futures price is $335.00 per metric ton, last year at this time it was $157.00 per metric ton an increase of 113%. Not all of this increase is due to the inflationary impact of the dollar, but when global yields are down due to weather factors this foolish US monetary policy has made matters needlessly worse.
The second factor in the overall global food situation is the American decision to, in essence, burn food in its cars, a policy championed by the environmentalists since the 1990's. In 2010 the United States produced 13.1 Billion bushels of corn, of that amount 4.2 billion bushels went into ethanol (33% of total production). That represents in 2011, a year in which global stocks are down nearly 8%, over 14% of all corn grown in the world being used in the most inefficient manner possible-American gas tanks.
Thus the futures price of corn per bushel in January 2011 is $6.51 as compared to $3.84 in January 2010 an increase of nearly 70%. While the price spike is in part due to lower yields, had the corn destined for ethanol been put back into the overall corn stocks, the net effect would have been to offset this lower crop and the global market would have maintained the 2010 price level despite the inflationary impact of the dollar.
There is no quicker way to foment riots and revolution than to deprive the populace of food, particularly when so much daily income goes into feeding oneself and one's family. The pictures we have seen in North Africa may well be repeated elsewhere throughout the world. This time the "Law of Unintended Consequences" wrought by the policies of the American Left and the Obama Administration will not be limited to the United States but to many throughout the world. If the riots in Egypt and the Middle East take a severe and radical turn, then the prospect of open warfare in that region, which will involve the United States, becomes a near certainty.
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keep your stocks up people.
It's gonna get worse, before it gets better.
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I hadn't thought about this, but now that I read it, it makes perfect sense. Scarier still is that if you take this line of thinking to it's conclusion, you find that without a serious change in American monetary policy, we could very well be precipitating open world war. And with the clown we have at the helm........We're porked.
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I just do a double take every time I see anyone promoting ethenol, including the gas companies themselves. I really don't want to be burning food in my truck.
Do "they" not understand, if you subsidize corn for fuel, you're burning the candle at both ends (weak pun I know). Not only are they stealing the tax money and giving it to something the public does not want. They are driving up the price of food which the tax payer can ill afford after you've taxed him for the subsidy.
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I just do a double take every time I see anyone promoting ethenol, including the gas companies themselves. I really don't want to be burning food in my truck.
Alf, it's been oft said that ignorance is curable, but stupidity is a fatal condition. You've read my statements here before, but it's never been truer than now: I weep for my Country. I fear we may beyond the ability to correct our stupid behavior.
Not only is burning food an inefficient energy transfer and a waste of food, it also effs up your truck engine. I used to think it was just the fuel lines that were ruined, but it also messes up valves, rings, and the tops of pistons--then it corrodes bearings and guides and eats away at head gaskets. This is especially true of older vehicles.
Ask Deepwater what it did to the lining of the gas tank on his murdercycle. It wasn't pretty.
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They want to INCREASE the amount of Ethanol in gas.
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My new truck has the E85 logo on it, and of course they tout it's ability to run on "cleaner" fuel. But when I bought the thing the dealer told me flat out, don't run it unless you absolutely have to. It'll tear up your engine.
I know from my moms vehicle that there is no upside to it. She gets far worse fuel economy with the E85 than with gasoline, so the money she saves on the fuel gets eaten up through lack of distance. Basically it's a wash. Pay less and not go as far on a tank, or pay $10 more and get 100 more miles out of a tank.
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Food prices are about to go non-linear. Commodities are still climbing, forecast is another 50% by the end of the year. And that is not including the current spike in oil prices.
The thing is fuel prices get added in a dozen times to the cost of food by the time you buy it at the store. So if oil goes up (whether supply/demand based or dollar valuation) it will compound the food prices.