Thursday, September 2, 2010

I told you to invest in canned goods

Brace yourself for the next big food shortage. Okay we in the US probably won't be starving but prepare to pay more, perhaps a lot more. Russia is still in the grips a major drought and has extended their ban on grain exports. Normally the fourth largest exporter of wheat in the world, not a kernel will be crossing the border for at least another year and they aren't promising anything after that.
A good deal of what the Russians export goes to countries where many people spend more than half their income for food. A thirty percent increase in the price of bread has already caused widespread rioting in Maputo and Mozambique leaving many dead and hundreds injured. Prices have surged 70% on European markets since January and have already exceeded the peak during the last food crisis that toppled governments in Haiti and Madagascar.

The truth is there is no shortage, not even close. Food will rot in the warehouses while people starve because Wall Street bankers and similar scum around the world want to suck piles of money out of hungry people and out of the rest of us too. Seeing starving people rioting will motivate the rest of us to not haggle over the price of canned goods and will increase the demand as those who can afford it will stock up. The last artificial shortage put a billion people into slow starvation and resulted in untold deaths.

The bankers don't even need to hoard the food themselves until it rots, they just need to control enough of the supply with contracts. This will panic various governments that can afford to buy food ahead of time to do the hoarding out of fear they won't be able to get food when they need it. If you want to stay in power you need to make sure the bread is on time and the circus is entertaining.

Wall Street bankers make out like bandits up and down the line. Not only will they reap huge rewards on commodity trading including derivatives that require nothing but pieces of paper to generate billions in profits, but they will make loans to governments and NGO's that are trying to deal with the "crisis" that Wall Street created. These loans are often backed by the taxpayer and the NGO's must waste money paying double or triple for grain and cut other worthwhile projects. Plus the more food they distribute the more this disrupts local markets and this cripples food production making a phony problem into a real problem.


In theory the world has twice as much food as it needs with obscene amounts wasted by gluttonous Westerners and from losses to rats and insects in the third world that eat or spoil half the food. But the greed of the "free" market is the biggest waste of food by creating uncertainty in the markets that constantly interferes in production. The same mega food corporations then uses the mess they've created to push out small producers in order to create efficiency in production further concentrating their control. There is far less objection to their Franken Foods if people are hungry or can be panicked into thinking they will be. The corporate model requires that a fairly high percentage of people are hungry all the time or they aren't maximizing profits. But the circuses are great aren't they? www.prairie2.com

Tuesday, August 31, 2010

The Cow Belongs to Wall Street, Keep Your Hands Off Her

The New York markets were up substantially today based on some feel good news about the economy. But those gains were wiped out in the early afternoon by the release of minutes from the latest Federal Reserve Open Markets Committee meeting. Basically the members were split with the majority acknowledging the economy is not recovering but they don’t want to purchase assets on a large scale.

This means the Fed won’t be pumping trillions of new dollars into the economy and the risk of deflation looms larger. This immediately drove up the price of US Treasury bonds and the interest yield down which normally translates into lower mortgage rates. Lower interest rates are meaningless if nobody will issue a mortgage.

Asian markets are tanking on the Fed news which comes on top of fears that Japan may not be able handle the surging value of the Yen which threatens their export based economy. The price of oil dropped $3 a barrel as traders are reluctant to hold any oil in inventory with the collapse of the world economy looming.

The stock market has had dismally low trading volumes all month and today was even slower. If volume gets low enough any large sale that can’t find a buyer could trigger a market crash. Supposedly they have put measures in place to prevent another flash crash but nothing short of closing the doors will halt an old fashioned panic. So much for the free unregulated market being the driver of the US economy (you know the envy of the world).

The Republicans have their predatory eyes turned toward Social Security again with the circling pack being led by Alan Simpson who has made disparaging comparisons between SS recipients and those who would steal milk from a cow. Funneling this money into the stock market would help offset the loss of 401(k) contributions.

Of course there would be no way to continue paying SS checks if they stopped receiving payroll taxes without cashing in the Treasury bonds the SS Trust Fund is holding. This would punch a huge hole in the Federal budget if this happened so the Republicans must justify not paying the money out. This scheme is as insane as Alan Simpson but this is what the Republicans will do if they come back to power. Having destroyed the economy along with the middle class, stealing grandma’s retirement check is now the only game in town.  www.prairie2.com

Monday, August 30, 2010

Obama cracks the big Egg

A glimmer of  Progressive government has appeared in the eye of the Obama Administration in the persons of Attorney General Eric Holder and Agriculture Secretary Tom Vilsack who opened a daylong workshop at Colorado State University for the few remaining independent cattle producers. These two cabinet secretaries were dispatched from Washington to express the government’s intention of reviving the Packers and Stockyards Act. This is the law from the by-gone age of Teddy Roosevelt’s muck raking that could break the strangle hold of our food supply by trans-national monopoly corporations.

Since 1980, the number of hog farms has dropped from 660,000 to 71,000 and cattle farms has fallen from 1.6 million to 950,000. While hog farmers got 50 percent of the retail value of a hog in 1980, their share today is 24.5 percent according to the USDA. Hog farmers that remain are no more than share croppers with virtually all the of hogs owned by meat packers and not by the farmers who raise them on contracts that put all of the risk on the farmer and all the profit into the pockets of corporations.

U.S. meatpacking giants like Cargill Inc., Tyson Foods Inc. and National Beef Inc., and Brazil's JBS SA, have been growing and consolidating control to a degree that didn‘t exist in 1921 when the P&S Act was passed. Cargill for example has used NAFTA to dump half price corn into Mexico to devastate the Mexican farm economy and simultaneously they recruited dispossessed Mexicans to come to work in its US meat packing plants (without legal papers of course).

Hog production had recently been shifting to mega farms in Mexico where health, safety and environmental laws don’t exist but that pesky swine flu pandemic has slowed that movement. The Packers and Stockyards Act also gives the government broad authority over poultry and eggs and we now see how well allowing giant unregulated egg producers works.

No meaningful government intervention in any area of big Agri-business vs. small farmers has occurred over the last 60 years. In fact this has been IMF policy applied worldwide to drive small farmers off the land in the name of efficiency, efficient elimination of independent people and efficient creation of corporate profits. In this efficiency movement people that are not of the top 3/10 percent of income are expendable.

This is not an easy row to hoe for the Obama Administration as Bush appointed Appeals Court Judges routinely dismiss suits brought by farmers alleging  price fixing and predatory practices by packers. The corporatist Supreme Court simply refuses all appeals. Court watchers have said there is no right or left bias to Supreme Court rulings in general but rather the deciding factor is which side is the corporation on. The corporation always wins. The thrust of the new USDA rules are intended to create an environment where these farmer lawsuits will be more difficult to quash.

Unfortunately these measures will probably have little immediate impact on the farm crisis but they do set a political agenda that puts Obama squarely in the Progressive movement. The DOJ has even broken into the long boarded up offices of its anti-trust division and is studying the possibility of breaking up the mega corporations. But maybe it’s just my polly-anna nature that I see this as a real possibility.  www.prairie2.com

Sunday, August 29, 2010

I Have A Scheme

Glenn Beck speaking in front of the Lincoln Memorial, it's surprising he didn't burst into flame as if he had been doused with holy water. Conservatives are never on the side of rights, freedom or any kind of justice. If you consider yourself conservative and you actually want those things for everybody and not just you, then you are being played for a sucker. (here is the cover of his latest book, a Freudian slip perhaps or he just doesn't think he needs to hide it anymore)



For more real history of MLK and not Beck's made up history here is a piece by Eugene Robinson http://www.truthdig.com/report/item/kings_dream_endures_20100827/