What the financial collapse can teach us about the food system

What the financial collapse can teach us about the food system
by Tom Philpott
25 May 2009

http://www.grist.org/article/2009-05-22-financial-collapse-food/

In a recent New Yorker, Nick Paumgarten published a lucid, entertaining essay on the financial collapse. Titled “The Death of Kings,” it focuses on the hedge-fund managers, stock gurus, and private-equity wizards who reaped billions from the credit bubble.food systemIs Big Ag running the food system into the ground the same way Wall Street wrecked the economy?iStock Photo

What were those people thinking? Turns out, Paumgarten relates that during the flush times, many in the world of finance had a “moment of clarity, an inkling of doom” about what was coming. “The sky was full of signs,” Paumgarten writes.

For many, the awakening came while driving through some overbuilt exurb in California or Florida, or watching a commercial for a subprime lender (“Mortgage consultants are standing by!”), or studying a chart depicting total debt to the gross domestic product.

Paumgarten’s tale is essentially about high-level fecklessness: people with degrees from the nation’s finest universities, rewarded with nine-figure annual salaries, knowingly driving the global economy right over a cliff. Paumgarten doesn’t go there, but the same analysis applies to financial policymakers and regulators; they, too, could gawk at obviously overbuilt exurbs, or wince at debt-to-GDP charts.

The whole sorry spectacle got me thinking of the global food system, the juggernaut that feeds billions every day. It’s not hard to make analogies with the financial sector whose rubble now lays scattered about, ready to be cleaned up on the public’s dime.

Like the financial sector, the food system has dramatically globalized over the past generation, even as it has become increasingly concentrated (PDF). Just as traders in New York, Tokyo, and London—often employed by the same mega-banks—can make, say, the Argentine peso plunge or soar with a few keystrokes, global food commodity markets have become tightly intertwined.

To read the full article: http://www.grist.org/article/2009-05-22-financial-collapse-food/