March 29, 2011
Obama's High Food Price Policy Stealing Milk from BabiesBy Jeffrey Folks
The price of corn has reached a record $7 a bushel. Other basic foodstuffs, including wheat, sugar, and soybeans are selling at or near record prices. Milk prices as well have risen to record levels, making it more difficult for families to purchase milk for their children. It is Obama, more than anyone, who is responsible for this state of affairs.
While food prices have always been volatile, today's high prices are not just the result of weather and other natural forces. They are the consequence of a sinister conspiracy on the part of the left to raise prices and force an ever larger number of Americans into dependency. As of early March, milk prices were setting new record highs, along with near record highs for corn, wheat, soybean, and other staples. Where is the President on this? He is out there promoting ethanol mandates that burn 40% of the U.S. corn crop, raising the price of everything from milk and meat to pop-tarts.
Obama claims to care deeply about the lives of ordinary working Americans, but he is the one responsible for rising food and energy prices. When Americans went to the store in February and found that their food costs had risen at an annualized rate of 7.2%, they had Obama to thank for it.
It is not just the President's policy of expanding ethanol subsidies. It is also a weak-dollar policy that forces Americans into competition on unequal terms with foreign buyers. On March 25 the USDA revealed transactions that strongly suggest the return of China to U.S. corn markets. As a result, corn future prices climbed 14%. That increase of 14% will affect what American consumers can expect to pay in the months ahead for basic foodstuffs. If the dollar weakens further against the Chinese yuan, as many expect (and against other currencies), American consumers may find themselves paying more than that for global commodities like food.
The President's solution to rising food prices is, of course, more government. With 25 million Americans unemployed, over 15 million Americans on Social Security disability (SSDI or SSI), and over 43 million Americans on food stamps, Obama's "solution" is to increase dependency even further. The President's 2012 budget proposal includes increases in funding for the government's food stamp and WIC programs, while it continues funding at record levels for a myriad of other food programs.
If Obama were truly concerned about food security, he would address the fundamental issues, not try to paper them over by paying out ever larger sums of borrowed money to an ever larger number of recipients. But the Democrats are never going to address the fundamental issues -- partly because of pressure from environmentalists, unions, and corn-state lobbyists and partly because they want more Americans to be dependent on government assistance.
Democrats actually seem pleased to find that 43 million Americans are dependent on food assistance and that the number has risen by almost 30% million since Obama took office. That level of dependency translates into a large block of reliable votes.
Once they become dependent on government food aid, welfare recipients constitute a lifetime constituency focused exclusively on maintenance and expansion of benefits. No wonder Democrats aren't interested in reducing the cost of food and other essentials. Or, for that matter, increasing the number of jobs within the private sector. Their interest lies in nudging more and more Americans onto the dole.
This is not the first time that a left-wing president has consolidated his power by expanding dependency. During the Great Depression, FDR's alphabet-soup of relief agencies enrolled millions in unproductive make-work projects, even as crops went unharvested and industrial plants lay idle. As Amity Shlaes has shown in The Forgotten Man, Roosevelt's socialist boondoggles prolonged the Depression by years.
What is happening today, however, is unique: this is the first time in American history when an administration is deliberately forcing food prices higher in order to increase dependency and extend government control over the economy.
There is hardship ahead even for those not dependent on government aid. Despite our nation's vast agricultural resources, Americans are not immune to the kinds of food shortages that have existed throughout human history and that continue to exist in developing countries today. It takes only a short time for a nation to slip from abundance into impoverishment.
Most Americans do not think of Romania as a resource-rich nation, but a century ago Romania, with its productive agricultural sector, was among the richest countries in Europe. At that time no one could have imagined the suffering that lay ahead as the country descended into 80 years of war and communist rule. The abundant harvests that had once fed Romania's people were commandeered by the government and shipped abroad to bankroll the extravagant lifestyle of the rulers and to fund the state security apparatus necessary to defend it. This and fundamental mismanagement resulted in decades of hunger for the Romanian people.
For America the combination of corn ethanol mandates and a weak-dollar policy is, in effect, a "Romania-style" seizure of the nation's food supply. The left is intent on gaining control of America's natural resources -- its agricultural and energy sectors, in particular -- and for exactly the same reason they were seized in communist states such as Romania. The control of food and energy is the means by which the left hopes to gain permanent power over the American people.
America is approaching a future in which food will be expensive and in short supply. The combination of an ever expanding corn ethanol program and the demands of a tighter global market will make food less affordable and less available. What may not be so obvious is that the American left, led by Obama and Democrats in Congress, actually want food prices to rise, just as they want energy prices to rise, so as to create further dependency. If they did not, they would take simple measures to lower prices: eliminate ethanol mandates, eliminate protective tariffs, strengthen the dollar, and allow the free market to govern prices. But none of this will happen with the left in charge because high prices and shortages serve the interest of a party intent on centralized control of the economy.
This disaster can only be averted by the defeat of Obama and of the Democrat-controlled Senate in 2012, and by the removal of leftists from government agencies such as the Environmental Protection Agency, Health and Human Services, and the Department of Agriculture. Above all, the nation must return to a free-market economy in which prices for food and all else are determined by supply and demand, not by the ambitions of leftists in Washington.
Jeffrey Folks is the author of many books and article on American culture.