Geopolitical Myths by Adnan Khan

Numerous organisations have researched into the general causes of poverty which range from the lack of resources to the nature of the local climate to the lack of democracy. There is generally no consensus on the causes by sociologists and think tanks. However, a dominant idea that exists is that only the diffusion of capitalism with its free markets is the cure. A cursory glance at not just the Muslim world but the third world in general shows a handful of factors have played a large part in contributing to the poverty in the world today rather than the shortage of food.

The role of IMF and World Bank and their notorious structural adjustment policies in countries such as Pakistan, Turkey, Indonesia, Bangladesh and Egypt have directly aided some of the underlying economic problems. The general solution provided by such institutions is one of trading their way out of poverty. They were forced to implement policies such as reducing and eliminating grain reserves, eliminating tariffs on food coming from Europe and the US and removing subsidies for fertilizer and other agricultural inputs. What this actually means is that Western goods should be imported rather than allow imports from poorer countries. The theory is that only via trade will nations pull themselves out of poverty. The development of a market economy with a greater role for the private sector was therefore seen as the key to stimulating economic growth and removing poverty.

As an example, Pakistan actually required essential investment in health, education and infrastructure before they could compete internationally. The World Bank and IMF instead required Pakistan to reduce state support to these sectors and concentrate on exports. They insisted on pushing Pakistan into markets where they were unable to compete with the might of the international private sector. Such policies inevitably undermined the economic development of Pakistan.

Another factor which has handcuffed the third world in poverty is debt. Africa is being asked to repay its legacy of the colonial era. Africa’s debt is partly the result of the unjust transfer to them of the debts of the colonizing states, in billions of dollars, at very high interest rates. It also originates from ‘odious debt’, whereby debt was incurred as rich countries loaned funds to dictators and corrupt leaders when it was known that the money would be wasted. South Africa, for example inherited “apartheid-caused debt” at $28 billion (which is now $46 billion). Post Apartheid Africa was forced to repay debts incurred by the apartheid regime so, in effect, South Africans are paying for their own oppression. In 1998 ACTSA (Action for Southern Africa) estimated that South Africa borrowed $11 billion (now $18 billion) to maintain apartheid, and neighbouring states borrowed $17 billion (now $28 billion) because of apartheid. Therefore, destabilisation and aggression now represents 74% of African owed debt. Colonialism has played a large part in the poverty of the third world. Colonialism has ensured dependency on the West, which allowed the continued presence and interference in parts of the world where extensive mineral resources exist. Africa today still labours from Western interference which began in the colonial era and has been forced to concentrate on commodities which the native populations would never be able to purchase.

The current global agriculture setup replaced subsistence farming where the cultivation of land was primarily for domestic consumption. Since 1960, international financial institutions have attempted to eliminate such a system and the mechanisms whereby governments can control food supplies. In their absence, national and international private companies have stepped in and have been dictating food policy in the interests of their profit margins. In times of stress, the mechanisms whereby governments could protect their citizens from the impacts of fluctuating prices no longer exist.

Hence the world’s poor are held to ransom by the international financial markets where the prices of global commodities are set. Although speculation has been the driving factor behind the surge in food prices during the global credit crunch, all was not well prior to the crisis. Since 1960, global food production has been transformed from a primarily local activity, albeit with the import and export of luxury foods, to a primarily global business.

International trade rules reward those who produce their goods for export over those who produce for local consumption. Though farmers in British Colombia and California both grow tomatoes in the summer, it is more profitable for them to ship those tomatoes over the border than to sell them domestically. Aside from the obvious ludicrousness of the situation, the increased transportation costs of shipping goods by truck across vast distances adds even more expense. In Asia, Latin America, North America and some parts of Europe, small farmers are becoming increasingly rare.

The industrialisation of agriculture through monocropping and over-reliance on chemical fertilizer and pesticides has effectively created economies of scale such that it is almost impossible for small farmers to succeed. Genetic modification of seeds adds yet another layer to that industrialisation, ensuring that large agribusiness companies including Monsanto, Archer Daniels Midland, and Cargill continue to post record profits.

The developed world continues to argue there is not enough food in the world, with populations rising there are just too many mouths to feed. Food shortages has also been utilised to explain the rise in food prices, however this fails to explain why in an increasingly productive and affluent global food system up to one billion people will likely go hungry? The problem is in the global food system i.e. the distribution of agricultural goods around the world and more importantly the corporate monopolisation of the world’s food system.

The dominance of the richer nations and companies in the international arena has had a tremendous impact on agriculture, which, for many poor countries forms one of the main sources of income. A combination of unfair trade agreements, concentrated ownership of major food production, dominance (through control and influence in institutions such as the World Bank, IMF and the World Trade Organisation) has meant that poor countries have seen their ability to determine their own agricultural policies severely undermined.

Policies such as structural adjustment demanded by these institutions meant most developing countries had to not only cut back on health and education, but food stamps and other support for the very poor. Trade barriers and other support mechanisms for local industry also had to be removed, allowing foreign companies to more easily compete (yet richer countries have hardly reduced their barriers in return). In addition, most poor countries were strongly encouraged to concentrate more on exporting cash crops to earn foreign exchange in order to pay off debts. This resulting reduction in biodiversity of crops and related ecosystems meant worsening environments and clearing more land or increasing fertilizer use to try and make up for this.

Increasing poverty and inequality thus fueled corruption making the problem even worse. Food dumping (while calling it aid) by wealthy nations onto poor countries, vast agricultural subsidies in North America and Europe have all combined and have had various effects on the poverty in the third world.

The third world remains poor due to the policies of the West and will remain poor not because of a shortage of food but due to the excessive consumption of the West:

- The West with 20% of the world population consumes 80% of the world’s agricultural production

- Consumes 86% of the world’s goods

- Consumes 75% of the worlds milk

- Consumes 70% of the worlds Timber

- Consumes 62% of the worlds Water

- Consumes 48% of the worlds energy

- Consumes 45% of all meat and fish

There is more then enough food in the world; the West just consumes the lion’s share of it.