Trousers Brown Counterpoint: Is Gordon right?
Energy + Food = Political Stew
Comment Some more details are beginning to emerge on the Prime Minister's new "food security" theme, which he has just been debating with other big-league politicoes at the G8 summit. Mr Brown and his fellow overlords were also concerned with Zimbabwe and various other things, but seem to have spent most of their time on the "triple shocks" currently hitting the world economy: high fuel prices, high food prices and high credit prices.
Setting out to the G8, Mr Brown raised the "food security" issue, and gained big ink with his suggestion that UK consumers should be cutting down on the amount of food they/we throw away. This seemed strange at the time, as by the government's own measures the UK has food security already. We produce half our food by price ourselves, and most of the rest comes from our own, reasonably secure trade zone - the EU. As Mr Brown points out, we waste a third of our grub; and most of us could easily stand to eat a bit less too. If the 15 per cent of our vittles that we import from outside the EU suddenly priced itself out of our reach or vanished, we Brits would be fine. So why should we panic about "food security", specifically?
Well, perhaps because food, for economic purposes, is largely made of energy. Land only yields grub in plenty if you use energy-intensive fertilisers, water (also potentially energy-dense) and powered machinery in abundance. Plentiful grub is only plentiful to you and I having been processed, shipped and stored, again using lots of energy. Perhaps not quite as much energy as the food-waste quangocrats at WRAP make out - their jobs depend on this number being high - but quite a lot of energy nonetheless.
Even so, all the energy required to deliver Blighty's largely EU-sourced food amounts to no more than ten per cent of the energy used nationally - and that's on the WRAP-determined high end of the truth. We luxurious Westerners mostly use power for other things than making food: heating, cooking, washing, industry, transport.
There's very probably an energy-security pinch coming for Blighty and the EU, unless we can wean ourselves off oil - and especially off gas, which we use for far too many things. Most of the big energy expenditures in most of our homes are done partly or entirely with gas, because we have a gas grid and the inefficiency of power stations makes electricity expensive. So the real power hogs in our homes - heating, washing, cooking - all tend to use gas. We also generate much of the 'leccy from gas, and we've even taken to running vehicles on it. (And please, no more about the gadgets on standby. It isn't a low-hanging fruit, it's a low-hanging Wolffia Angusta. You could pluck fruit this size all day every day and not achieve anything.)
North Sea gas is running low, and already some of our EU chums - who we need to look after so as to keep eating, if nothing else - are getting dangerously addicted to Russian gas. So will we quite soon, at this rate. Giving money to Russia for fuel is a particularly bad idea: Moscow uses the cash to sustain the only military-industrial complex which can give the Western one a fight, meaning that the West must keep spending money on staying ahead. It's even worse than giving money to Gulf oil states who spend it on terrorists and radical madrassas; terrorists are a largely negligible threat, whereas Mikoyan, Sukhoi et al (or UAC, as they prefer to be known nowadays) are serious business, and will only be more serious the more Russian gas people buy.
Feed the world...
So yes, we've got an energy security problem - which might account for the EU's enthusiasm for carbon pricing and caps. These naturally tend to get us off gas and oil, so you can like them even if you don't worry about climate change.
But food is only ten per cent of our energy, so it's really just a small add-on to the energy problem for us in the farm-protectionist EU. Trade barriers and subsidies paid for by the UK, Netherlands and Germany mean that Europeans don't have to worry about food much. So why is the PM so concerned about it?
It seems that in fact he isn't that worried about us. He's mainly concerned about poor Third-Worlders, especially in Africa. An energy pinch is terrible news for them, because they mainly use energy for making food. It isn't just ten per cent of what they've got, like it is for us, and they don't throw away a third of their grub either. Those folk can barely produce enough to eat on a normal day - especially because a consequence of the EU and US farm protection is occasional dumping of surpluses on the world market, keeping the Third World's food production low.
All this leaves poor folk vulnerable. Energy prices go up, food prices go up, people starve. They don't have any option to do a bit less laundry, put in loft insulation or whatever, and so find enough energy to produce food. They just have to eat less.
There is a way for the Third World to get some boost in its farming capacity; but it comes with a catch. The Wall Street Journal reports this morning that Saudi Arabia - which has loads of energy but imports a lot of food - is using its oil money to buy up farmland in the Philippines, Indonesia and so on. The Saudis are happy to pay for fertiliser, equipment, fuel and the rest: these farms will show productivity levels similar to those of the West. But in return, the desert princes want a lot of the food supply guaranteed for them, locked in perhaps for decades. They're willing to let hungry locals have some of the grub, but probably not as much as they'd like. For the poor folk living near the farms, nothing much would change. Once again, oil and gas money from the West getting spent in ways the West probably won't approve of.
All his political career, Gordon Brown has hated this sort of thing. He has always wanted to seriously tackle world poverty, insecurity and inequality. He spent ages at the Treasury building up funds to do so, and was reportedly quite miffed when a lot of the cash got sidetracked into paying the extra bills of the Iraq and Afghan wars.
He has always wanted to end the EU's protectionist farming regime, too, which would give the Third World a much fairer shake - the more so as the EU probably wouldn't drop its trade barriers unless the US did likewise, so America would need to take similar steps. He said as much to Parliament on getting back from the G8 meet:
One major element in reducing food prices... will be a successful outcome to the Doha trade round, where lowering trade-distorting subsidies and import restrictions could increase the global gross domestic product by as much as €120 billion a year... the present challenges must not be an excuse for a renewed bout of protectionism.