After news reports that Sam's Club and other grocers are limiting the amount of rice purchases this week, and of course the general upward trends of food stuff commodities ... we hear that even more people are starving in parts of the world.Why? How can this be?
Tyler Cowen features his own article Freer trade could fill the world's rice bowl which ran in full length in the New York Times.
Here is the most interesting paragraph: (his quote, but I agree)
"The reality is that many of today’s commodity shortages, including that for oil, occur because ever more production and trade take place in relatively inefficient and inflexible countries. We’re accustomed to the response times of Silicon Valley, but when it comes to commodities production, many of the relevant institutions abroad have only one foot in the modern age. In other words, the world’s commodities table is very far from flat."
So, how exactly does a country or a farm belt return to free market roots? Should we unilaterally eliminate all farm subsidies and then go to the free market table with one less hypocricy in our back pocket? Should we stop paying gas stations to sell ethanol, since it's probably not cleaner and the market needs to pay for what it gets?
