I am aghast when I read at MSNBC Money the “good” side of higher oil prices.
Summary: it will make you buy a smaller car, not travel as much, and so you will be healthier from walking and Mother Gaia will beÂ less polluted.
Yet the real cluelessness is that the writer sees high oil prices as cutting down on “luxuries”, things that make life easier or happier for the rich first world.
The real problem is that oil prices will mean higher food prices for folks who areÂ living on the edge of poverty in much of the rest of the world.
Costlier food contributed to riots across northern Africa and the Middle East that toppled leaders in Egypt and Tunisia and is driving up inflation, spurring central banks to consider higher interest rates. The bank estimates that 44 million people have been driven into poverty since June as a result of food price spikes.
The surge in food prices is linked to higher oil costs, the World Bank said. It estimates that a 10 percent increase in crude oil prices is associated with a 2.7 percent rise in its food-price index. Crude oil has risen 35 percent over the past three months.
The increase in food prices is not simply due to the rise in oil prices: There also has been weather related crop failures in parts of South Asia.
If you wonder why high oil prices means hunger, blame globalization and modern agriculture methods. Presumably the elites will say, go back to growing the old fashioned way: but this ignores that old fashioned methods of agriculture mean more folks working on the land and less efficient ways to grow.
Our family grows organic rice, so let me give you a snapshot on rice growing.
To grow rice, you first prepare the fields. This often means burning off the hay from the previous crop and then flooding the fields to get the organic material to rot in them.Â This cuts down weeds (no herbicide) and enriches the soil (less fertilizer needed).
But this requires either back breaking labour with a water buffalo or the easier way, using a handplow. (This is a large roto tiller). We have both, but the handplow is a lot more efficient and easier for the farmers, especially in harrowing the thick mud. The handplow AKA roto tiller aka two wheeled tractor, has revolutionized agriculture in east Asia, but few in the west are even aware it exists. And it uses diesel. A big variety of these machines can be found on this website that sells them on the internet.
Second: to grow two harvests a year, you need irrigation for the dry season crop. True, the irrigation ditches can be dug and maintained by hand, but again the use of backhoes and tractors make it more cost effective. You need diesel powered pumps to lift the water into your fields, which are usually higher than the irrigation ditches. Again, this can be done by hand, but it’s back breaking labor.
Three: Spreading fertilizer (here we use organic fertilizer, not oil based fertilizer) and mixing it into the wet boggy field also is done much more efficiently with the handplow.
Four: Planting rice seedlings is done by hand here. But it is easier for us to buy the high yield hybrid seedlings from the government than to grow seedlings ourselves. That means driving our pickup truck 40 miles to buy them, and then delivering them to local farmers.
Once you have a crop, you harvest. Again, it is done by hand in our area. But harvesting is not enough: You need to separate the grain from the stem. This is very hard to do by .hand, so we have a thresher. Again, it is run by a diesel motor
Once you have the grain, you need to dry it so it can be stored. Traditionally this means spreading it out on a flat dry surface in the sunlight. In our area, travel in rural areas during harvest time is slow because most of the roads are used to dry rice, and the government estimates this method results in losing about five percent of the crop.
But last year, we had rain at harvest time, so we had to take it to the rice mill and wait in line to get it dried. That costs money, and with the long line, part of our harvest was ruined or very poor quality due to mold. So this year, we bought our own rice drier.Â Again, this uses electricity, (our local electricity is from a hydroelectric plant) but if there is a power outage, it means using a diesel generator.
Then we store the rice: In sacs made from some sort of oil based plastic material (3 peso a sac, which doesn’t sound like much until you see how many we need).
So where does the rice go next? To the rice mill. We have a two ton truck to carry our bags, but local farmers load up their tricycles, a motorcycle with a sidecar, to carry the heavy bags to the mill. Next step is milling (again, diesel powered milling machines).
Then we pack it (again in plastic based bags) and take it to grocery stores in Manila to sell. Again, diesel used for transportation.
So increase the price of oil, you get an increased price of rice at nearly every step, because it is oil that allows the machinery to work the fields and especially to help in transportation of the product.
Even the idea “to eat locally” ignores that carrying “local” rice 50 miles to Manila means a truck. True, we could send it down our new highway in a cart pulled by a waterbuffalo, but that would take a few days and one has to consider the price of food and shelter for the drivers and the animal. And I am not really sure that it would be possible to carrying enough rice (not to mention vegetables and fruit) for 10 million folks in Manila this way.
But what about years, like the last two years in the Philippines, where local food production wouldn’t be enough to feed everyone?
That means importing food from other countries. And unless we go back to sailing ships, that means using more oil.
Here in the farm area, the “hunger time” usually is shortly before harvest, when farmers find they sold too much of their crop and now have little to eat.
But in the city, hunger time is every day for some, because unemployment in Manila is high and every day more poor arrive from those picturesque rural areas that foreigners love to see in photos. True, families share what they have, churches give out food, and the government subsidizes rice for poor families, but you still have a daily near crisis for many families.
So the increase in food prices is not an inconvenience, but literally could be the difference between barely making a living and daily hunger.
Finally, the writer of the MSNBC article makes a snide remark that if oil costs too much it will discourage war.
One: The real danger is that the oil profits will go to certain countries that are busy planning a war with Israel. More money, more SCUDS to hit Tel Aviv.
Two: Oil profits will go to the rich in the Middle East, who as good Muslims will send more money to charities. The bad news is that some of these charities siphon off a percentage to support terrorism. Much of the poverty in the south Philippines is due to Islamic charities helping the “insurgency” in the south.
Three: as oil prices increase, the diversion of land and crops to supply biofuel will cause more shortages of cheap food.
Four: the search for cheap energy by China could destablize Asia: The aggressive moves against the Philippines and Viet Nam in trying to take over the Spratlys islands is only a blip on the map. The real danger is a “pragmatic” China who is making moves to be friendly with the Islamic states in Central Asia to the detriment of India and the US.
Five: Hungry folks riot, and riots can overthrow governments. Given a choice between being hungry in a democratic liberal state or living under dictatorship that makes sure your kids eat, guess what the answer will be?
The local proverb goes: When the elephants fight, the mouse suffers. And the increase in oil prices, which benefits some of the bad guys in the world, bodes bad for the poor.
Nancy Reyes is a retired physician living in the rural Philippines. She blogs at Finest Kind Clinic and Fishmarket.