Down with autarky

Soaring food prices have become an increasingly important geopolitical issue in the last few weeks. As a result, there are lots of fascinating examinations of the relationship between free trade and food prices.

Tyler Cowen’s New York Times column makes the case for free trade to solve the world’s rice problem. Dani Rodrik reckons Cowen is right that free trade would improve the supply of rice, but not necessarily the price. Two excellent economists; two differing views, eloquently argued. Andrew Leonard offers a different take: Cowen, he writes, is arguing about the long term effect on supply and prices. In the near term, governments rightly need to be concerned about food riots and people going hungry.

Although most of my political leanings are liberal (very liberal in the US context), on this issue I’m much closer to the free traders (which, in a different political milieu, is also a “liberal” attitude). Certainly I agree with today’s Financial Times editorial that French agricultural minister Michel Barnier is offering a thorough barmy and dangerous idea by saying that the rest of the world needs to follow the European Union by creating their own versions of the appalling Common Agricultural Policy. Thankfully, the European Commission as well has dismissed Barnier’s idea.

Food politics for a good Berkeley resident like me is complicated. I generally subscribe to the notion of “food miles”, where the distance food has to travel to reach my plate is an important consideration for both environmental and health reasons. Northern California’s extraordinary bounty of just about every fruit, vegetable, dairy product, meat and fish (not salmon at the moment, however) makes it easy to be virtuous with regard to food miles. But equally, I think international trade in agriculture is an essential pathway for development for many of the world’s poorer countries. When I lived in London I was happy to buy vegetables from Kenya and Uganda, despite the many miles they had traveled to East Dulwich Sainsburys.

Agriculture is one of the sectors where many poor countries have a real chance in the near term to develop comparative advantage over Europe and North America in some foodstuffs. Let’s give them every opportunity and not spend money propping up the dwindling number of farmers in the wealthy North.

Irrelevant note for word freaks One unexpected byproduct of the Barnier barny is the recurrence of the rarely seen word autarky.

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