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FIRST ACCESS to Nadeem Walayat’s Analysis and Trend Forecasts

The Food Crisis War Endgame

Stock-Markets / Food Crisis Aug 04, 2011 - 05:55 AM GMT

By: Andrew_McKillop


Best Financial Markets Analysis ArticleNothing gives better proof of a sure and certain, rapidly growing global food shortage than the simplest look at how commodity markets have been responding to the US debt crisis, the coming devaluation of the US dollar, and the merited exposure of Barack Obama as a loser. Stripping away the short covering, the dollar crisis, inflation fear and all the rest, we find that food prices are resisting a lot better than oil prices, to the rising likelihood of recession in the western world, and maybe also global economic recession.

If food products were "pure commodities", like oil basically is, like copper basically is, they should also tank on this recession outlook.

But that isn't happening. Prices, to be sure, are highly volatile but the fundamentals tell us why food prices are so resistant to recession fear. UN FAO food supply, demand and price data proves that global demand is high, but supply isnt. The result: food prices are rising even as most OECD countries, led by the US, the EU27 countries and Japan are either in recession, close to recession, or experiencing constantly falling economic growth and rising unemployment.


We know all to well that "food is a weapon". This is what we can call FoodWar-1, dating from the 1970s and before.

Food supply was then only a blunt instrument in the foreign policy of food exporter countries - which were traditionally led by the USA, the biggest exporter, but that is changing fast. In commercial terms, the balance on its food trade by value, the USA will likely become a net food importer by or before 2017. Other major food exporters are as small in number as the number of world net creditor nations - that is countries whose debts are lower than their credits, and which usually run net trade surpluses with the rest of the world.

More than 150 nations run a deficit on their food trade - they import more food than export it. The food deficit is worse than the oil deficit, measured by global food import dependence. The so-called "food weapon" in fact exhibits, yet again, the wall-to-wall schizophrenia that is not second nature, but the primary nature of our crisis prone and dangeroulsy incompetent ruling political and corporate elites. They want food shortage, to exercise political and commercial power, and they also want population growth, for cheap labor and growing markets - but refuse to understand this is a zero sum game. Literally, the growing population will eat up the food surpluses - and neither a worker nor a consumer of T-shirts and cellphones is much use when they do not have enought to eat.

Food shortage is driven by population growth: anybody who wants to deny that by calling it fascistminded can take a look at how agribusiness operates, from Monsanto, Dow, Bayer and McDonalds to the Bill Gates Foundation. Their game is trashing the environment for decades or centuries ahead and making profits right now - - while just about being able to feed 6.1 billion persons on Earth. The other 900 million suffer permanent food shortage. That is one-in-seven of world population. The number of underfed is growing by around 4% to 6% per year - far ahead of the population growth rate, and the average rate of global economic growth. And one thing is sure: in global economic recession the underfed will grow even faster, unless food prices behave like "other commodities" and tank in recession - which is no longer certain.

This is the danger: recession will come. Oil prices will drop, even gold edges down a little - maybe - but food prices stay high and dangerous. They can, could or might even continue rising in global economic recession, drastically multiplying the social stress and damage from recession.

The cards and dice are stacked and rolling that way. We can be 100% certain that any abandonment of pesticides-and-ferilizer, monocrop, irrigation-based "farming", that is agribusiness, will firstly result in a large net fall in world total food supply. Any attempt at a rapid phase-out of agribusiness would move us up to say 1300 million persons who suffer permanent day in and day out food shortage - and anybody saying we need to control population is still a fascist, right ?

The shift to sustainable low-input agriculture, ask Bill Gates, is a nice slogan but doing it will soon be a lot more necessary than only talking about it. This is an epochal shift and a change of civilization, which Gates doesn't mention too often - it will be bad for profits - and the change that is coming will be basically open-ended. Population control will be high up the list.


Just occasionally, our ruling elites get worried about their gameplan of food undersupply-population oversupply. Being fascist minded when pushed, they have all kinds of fallback ideas and plans for wiping out a billion persons here, a billion persons there: this isnt Norway designer massacre stuff ! But until they have to pull the plug on the human race - and being schizophrenic - they have to keep the party going with profits flowing from growing populations and for corporate cronies who make everything from fertilizers and pesticides to nerve gas and bioweapons.

In fact, these 3 last-cited business activities are all close-linked and related: check the story of the organophosphate pesticides like TEPP, which started their commercial lives as ultra-powerful, ultralethal nerve gases and chem-bio weapons. Spraying them around in the country is called "farming". Monocrop high yield agribusiness, with its oil-pesticides-fertilizer mantra, to which you need to add irrigation (78 percent of world water is used in farming), is the only thing that separates us all from a decades-long food crisis. Our elites musing in private on how to get rid of 1 billion here and 1 billion there would have their musings fulfilled - and more. But their one-only choice of agribusiness, and their refusal to act against overpopulation means the unwinding of the coming global food crisis is completely out of their hands. Just like the sovereign debt crisis.

Back as 1974 Henry Kissinger, who is often accused of war crimes but not FoodWar crime, mused in secret that "Hungry people will do anything for food". Those who control food supply can use it as leverage. This revelation for Kissinger coincided with the USA learning about oil shortage, but his argument was that food shortage can be used to induce political change - including forced birth control. This musing from 1974 is now revealed, in a previously classified US National Security Study Memorandum, No. 200: "Implications of Worldwide Population Growth for U.S. Security and Overseas Interests".

Kissinger advocated various tactics but had no real strategy. Food supplies on one hand could be used to force family planning, and they could also be used as a blunt instrument of foreign policy but only against countries in dire straits. The use of "the food weapon" was not taken up at the time by US deciders, for the simple reason that the US food trade surplus was so important for helping trim the USA's already growing overseas debts and rising trade deficits.

What happened since the 1970s is easy to summarize. The facts speak for themselves: through 1970- 2010 the world's population doubled from 3.5 billion to 7 billion. It grew by over 11 times the population of the USA today. If it could or might have been possible to feed the 3.5 billion in 1970, which wasn't the case, it will be even less possible to feed the 7 billion od today, growing at 65 million a year. This is a simple fact. Forgot about your "knowledge based agro-revolution" and Third World farmers with cellphones finding the best price for their products in the nearest market.

Our ruling elites know all this, but being schizoid, they panic about ageing Baby Boomer populations and insufficient birth numbers of future consumers and future taxpayers to help pay the wild, fantastic sovereign debts they also cooked up through their one-only wait-then-panic operating mode for running the economy. So they want population growth but they fear population growth - which they should.


The Kissinger food war strategy was far away from being a subtle thing: it only really works on nations and territories enduring economic collapse and with few or no food stocks and resources for food production. The "peace dividend" for FoodWar is like the peace dividend in Afghanistan: zero. The country or countries wracked by famine and food shortage will certainly not bounce back into virile economic growth, because solving food shortage - with growing populations - is not an easy thing. This is basically why Kissinger's 1974 strategy (in fact tactics) were put on the back burner. As a result, and because the world's population "just happened to double", the world's environment has been ransacked and continent-sized ecosystems have been dangerously weakened, often right to the brink.

We have a whole new FoodWar, operating right now, worldwide, uncontrollable.We can call it FoodWar-2, and it's an endgame. Everybody loses, we have no choice.

We can call FoodWar-2 more subtle because it is multiform, dangerous and permanent, unlike the outlyer food panics of the 1960s and 1970s - which were supposedly "solved forever" by the Green Revolution, which in fact was nothing but the good old mantra of oil-fertilizers-pesticides-irrigation, and nothing else. FoodWar-2 is also different because it is engaged against every country on Earth - including the food game controllers. On present population growth trends, with present urban-rural population patterns, with the same economic system as we have now, the countdown to dependence on food imports for nearly all present major food exporters in the OECD group - like the USA, France and Spain - is fast and sure. It may happen by 2020, perhaps a little later, perhaps sooner.

No Einstein is needed to tell you, it is not possible to have a world made up of countries all of which are net food importers. This is the endgame and it is coming.

There are so few exceptions to the list of large food exporters in the OECD Old Rich-New Poor group of countries which will not soon become importers, that we can name them: Australia and New Zealand. We can be sure and certain these 2 countries can't feed the world, and have already maxxed out in agroproduction.

By 2017 on current trends, the USA will be running a net trade deficit on food and agricultural products. The European Union is proud of its agribusiness forcing strategy, the Common Agriculture Policy, taking over 60 percent of all European Commission spending but if those subsidies are stripped away, Europe's 27 countries become instant food deficit. Without subsidies and good old agribusiness, Europe is a food importing group of countries, and has been that way for decades. Japan has the most oil-intensive food production system in the world, using an incredible 10 barrels of oil per hectare, each year in its rice farming, but even with this, it remains a huge food importer country. Both China and India are large and growing net food importers, having to spend more and more on food subsidies..

Like we know, there are only two ways out of the food shortage and overpopulation threat: increase food supply or reduce population. This has been known for decades - but nothing happened. Making this even worse, FoodWar-2 operates a multifaceted attack on anything and everything to do with food.

This ranges from what is outright biological warfare against natural species and natural ecosystems - called agribusiness and producing the food you eat - to people's physical, as well as commercial and economic access to food. In other words, what Kissinger advocated 37 years ago has spiralled out, grown in scale and complexity, getting so expansive and wide ranging that it is almost surely and certainly out of control. The game controllers themselves got trapped by their own refusal to treat the real problems - and when they are in trouble, watch out !


Global agribusiness is very comparable to, and dependent on global banking. Through massive corporate consolidation in agriculture, food and farming, coordinated and convergent global food regulations, and chaff dollars euro and yen thrown on the gaming play tables of unrestrained food commodity speculation, agribusiness creates food shortage, and has a vested interest in food price explosions. To be sure, we wont expect the agribusiness players to say that ! Commodity-oriented agribusiness is a corporate profit tool, but farmers net few or no gains from this. Farmers are low-tech debt-serfs in the low income countries, and are high-tech debt-serfs in the high income countries.

Agribusiness is lethal to the planet and to our future. It wreaks chemical damage, genetic modification and systematic damage right across the food web, both locally and across continents. It punches deep holes in the very base of biosystem and ecosystem operation - for example by almost wiping out bee populations in dozens of countries, cutting their numbers by as much as 75% since 2005 in some cases.

We have constant, sad and shameful proof of the damage dome by agribusiness, in the shape of collateral dead natural systems, right across the planet. The seven seas, for example, have been so ruthlessly predated by deep sea and inshore fishing, that large and ever-growing numbers of food fish species will take decades or even centuries to recoup numbers - or die out entirely. We have lost the resource. Aquaculture and mariculture run on the business mantra of oil-antibiotics-insecticidesfungicides, in case you didnt know, meaning we replace the good with the harmful and unsustainable.

This is progress ! We are feeding about 6-in-7 of the world's population: Rejoice !

On top of real shortage, FoodWar 2 brings manipulated and unpredictable food shortages, and underlines what this new war really means: this war targets the general population - everywhere. We are all targeted. The bottom line is simple and you can see it in your local shop: It means high food prices and also the increasingly sombre and real threat of straight physical shortage. The Olde Worlde term for this is: famine.

We therefore need to understand the strategy and tactics in order to fight back against them: this war is produced by the exact same elites who have destroyed our economic and monetary systems, but the damage done to natural ecosystems and living species is not going to be changed overnight through a stroke of the pen.

Debts could or might be treated that way, even though debt conflicts often lead to war. But the damage from FoodWar-2 will need decades and decades of massive change to stop the Death Machine. Food shortage is not going to run away and disappear because the economy got a little less bad. Also and unfortunately, like so many other crises we heard too much about but which never happened, nobody will believe in this one until it hits them - in the stomach.


Crippling food price inflation, by 2008, had caused deadly riots in at least 40 countries. Today in 2011, food commodity prices are as high, in some cases higher than they were in 2008 - and world population has risen by another 200 million since 2008, or two-thirds of the USA's total population today.

Through June 2010-June 2011, the UN FAO's world food price index rose by 39 percent.

Food price inflation now affects every corner of the globe, to be sure with the poorest countries most exposed and feeling the worst hunger pangs. All and every country experiencing the Arab Spring revolt, and its trend to linked civil war, is we can note totally dependent on food imports for all basic foods. The world's three-largest wheat importes by rank are Egypt, Algeria and Saudi Arabia. Street protest might be nice, and is surely needed to overthrow dictators and tyrants - backed or tolerated by the western democracies for decades - but food shortage is almost guaranteed to turn democracy protests into civil war, even faster and more surely.

Exactly like oil prices, food commodity prices rise not only through physical shortage, but also because of the naked decline of the US dollar used to pay for them, causing a flight to "real resources". Factors like extreme weather damage, tsunami damage in Japan, and plant or livestock diseases and pathogen outbreaks - often linked to chemical and genetic manipulation of crop plant and livestock species - can at any time radically cut supplies and increase food prices in a few days hectic trading.

The arm of food shortage and high prices, to be sure, can still be wielded in blunt weapon FoodWar-1 style, on already down-and-out countries. The endless negotiations with North Korea are basically a nuclear threat and food game, where Pyongyang holds a nuclear gun to the West's head in exchange for food. Pirate Somalia, when it was last a country and not a fuzzy and starving no-mans-land of feudal chiefdoms, was food self-sufficient until the 1970s. It is a "failed state" because of food shortage or food shortage helps keep it locked down as a failed state.

Like we can guess, the Peace Dividend in either of these cases will be almost zero, but deliberately intensifying the food crises in North Korea and Somalia yet again underlines the schizoid but vicious nature of our ruling elites. More important, FoodWar-2 needs no political trigger-pull, the process is in global operation now, 24/7, and will only keep going.

The measuring rod of this is rising food prices.

Food War 2 is worldwide and multiform, but has one single end result: food prices will rise. Trapped in a web of regulations restricting food freedom in all ways, starting with what farmers are allowed to produce, to protect the agribusiness cartel which controls the basic building blocks of food, from the molecular level up and through the entire system, the potential for change is low. Raising global food output through changing the methods and techniques utilised, including a shift back to traditional farming, is practically impossible, even in the midterm.

There is no short-term way out, nor midterm way out. Food prices could "go on rising forever", but just like other fetish symbols and needs of the consumer society - oil in particular - when we have a constantly rising price, the economic and social systems get flakier, faster. This will go on a certain time, depending on wealth and spending capabilities in different countries, depending how much inflation middle class voters can absorb with their McDonalds - but the process will not go on forever.


The elites took a look at runaway population growth in the 1970s and stepped back: they linked it with controlled and manipulated food production, and made a weapon out of it. The weapon was remodeled and refined over the decades, while population kept on growing. Today, the words of Roosevelt are acid-tinged: "People who are hungry and out of a job are the stuff of which dictatorships are made."

They also make revolutions, Mr Roosevelt. The same elites who cooked up FoodWar 2 have destroyed the economy of dozens of countries - especially their own countries - since 2008. In Europe's debtwracked PIIGS, adult unemployment is often 20 percent, and youth unemployment 40 percent. Rising food prices can easily help the generally placid, inert and egoist, consumption crazy populations of Old

Rich-New Poor countries to get a lot less inert and a lot more more political.

Food War2 comes at a particularly bad time for our ruling elites - so if they chose to aggravate and intensify FoodWar-2 this is yet another proof of their stupidity.

Out in the killing fields, that is agribusiness fields, the damage keeps on growing. The biosystem damage reducing future bioproductivity - the ability of living systems to provide us food - continues 24/7. Agribusiness employs a host of methods and tactics which make this certain, like destroying biodiversity to the point where only GM seeds for crops totally dependent on pesticides and fertilisers can grow in near-sterile, compacted, degraded and eroded soils, called "fields". But agribusiness has no strategy - or if it does have one it has no sense at all - because it is zero sum and total loss.

This blowback is known and proven by what we have now. More is coming and exactly the same applies to overpopulation. Refusal to apply population controls 40 years ago has in that time allowed another 3.5 billion persons to need food, now and every day, but agribusiness denies food to more than 900 million persons, today and every day. The growth in numbers of those who dont eat - around 4 to 6 percent a year - vastly outstrips either economic growth or the growth rate of global population - around 0.9 percent a year. Agribusiness and overpopulation are two proven loser strategies.

When the ruling elites get a handle on this they will panic, as ever. In semi-secret cabals and clubs like the Club of Madrid and the WorldShift Network, for at least 4 years, agenda items include present world food shortage and the coming shortage of medecines, fertilizers, genetic materials for agribusiness crops, livestock pathogen outbreaks - and a string of other tell-tale items. Also figuring, to be sure, is the "potential" for nuclear catastrophes, in the plural.

We can perhaps get a little satisfaction from knowing that FoodWar 2 was almost certainly never planned as a global strategy. It emerged from a nexus of never treating simple problems with clear and courageous action, but to always use two-faced muddling through - with panic afterwards.

Cynics can of course say the elites acted like that with the economy - they muddle through with bigger and bigger debts - so its no surprise they do the same with food and population. But as we have said many times in this article, the lasting damage to the environment from agribusiness, even if we stopped it dead in its bulldozer tracks, would take decades to heal. And between times how do we produce the food needed for 7 or 8 billion persons, assuming that population control goes serious, and world population peaks out at 8 billion ?

FoodWar-2 happened because it was unplanned. It was only a reaction to short-term corporate needs for making profit out of hunger, but the agribusiness weapon that was used is now killing the planet. FoodWar-2 goes far beyond so-called "economic and military security" - and concerns our basic ability to eat. This ultra basic need is now systemically compromised, worldwide: FoodWar 2 has gone critical.

As they say in French: Bon appetit !

By Andrew McKillop


Former chief policy analyst, Division A Policy, DG XVII Energy, European Commission. Andrew McKillop Biographic Highlights

Andrew McKillop has more than 30 years experience in the energy, economic and finance domains. Trained at London UK’s University College, he has had specially long experience of energy policy, project administration and the development and financing of alternate energy. This included his role of in-house Expert on Policy and Programming at the DG XVII-Energy of the European Commission, Director of Information of the OAPEC technology transfer subsidiary, AREC and researcher for UN agencies including the ILO.

© 2011 Copyright Andrew McKillop - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

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