Food, oil, and speculators.
Food, Oil, and Speculators
By Richard Van Slyke
May 12, 2008
The truth is slowly starting to trickle out. Not thanks to the hard work of the U.S. mainstream media, but just because it’s so real that it can’t remain totally hidden. What is really causing the rise of food and oil prices?
Many reasons have been given over the past few months.
Shortage of oil production turned out to be a false pretext; there is more oil being produced now than in the 1970’s.
The use of corn and soybean for biofuels, a reason given by George Bush a few weeks ago, was retracted days later. Biofuels do play a part in the rise of food prices, but absolutely not to an extent that would justify the rise that occurred.
So the major factor in food and oil prices jump is slowly emerging in the news: speculators. Of course, the first reports came from outside the U.S.; then it was picked-up here by alternative medias here, citing foreign sources. And now some major media are (probably reluctantly) bringing it up.
According to various estimates, speculation accounts for 30 to 60% of the prices of oil and food.
Now, what’s amazing is that the outrage remains limited. It seems like disasters brought upon us by Wall Street are viewed as Acts of God, like hurricane Katrina or an earthquake. No one really believes that anything can be done about it. Surely not in Congress or in the Senate where senator Byron Dorgan from North Dakota remains, as usual, the lone elected official raising the issue.
Who is really affected?
Every U.S. citizen is affected by the price of gasoline. But most businesses also are; and not just small businesses. Airlines are going bankrupt; the whole trucking industry, the backbone of commerce, is suffering. And this affects directly the price of all goods.
The rise of food prices right now affects mainly the poorest part of the population in a serious manner. But there is no doubt that everyone else also feels some level of pain. And it doesn’t seem like it’s about to ease at any time soon.
So why are these issues not making front-page headlines every day in the mainstream media?
Below are the links to several articles on food, oil and speculation. The first two (one on food from the German newspaper Der Spiegel, and one on oil form the U.S. financial web site Financialsense), will give you all the basics to understand the situation.
The third one is an interesting article in Chinadaily “Rising food prices? Speculators are only part of the reason”. Interesting because it is a typical example of distortion. In short, the argument is that food prices are rising not only because of speculation, but also because of the rising price of oil. The article omits the fact that speculators also affect the price of oil.
The Role of Speculators in the Global Food Crisis
http://www.spiegel.de/international/world/0,1518,549187,00.html
PERHAPS 60% OF TODAY'S OIL 
PRICE IS PURE SPECULATION
http://www.financialsense.com/editorials/engdahl/2008/0502.html
Rising food prices? Speculators only part of the reason
http://www.chinadaily.com.cn/cndy/2008-04/04/content_6591294.htm
Profiteers Squeeze Billions Out of Growing Global Food Crisis
http://www.alternet.org/workplace/84382/
Multinationals Make Billions In Profit Out of Growing Global Food Crisis
Speculators blamed for driving up price of basic foods as 100 million face severe hunger
http://www.commondreams.org/archive/2008/05/04/8710/print/
Speculators and soaring food prices
http://www.iht.com/articles/2008/04/16/opinion/edpfaff.php
Food Riots and Speculators
http://www.counterpunch.org/whitney04262008.html
India's inflation fans futures anger
http://www.atimes.com/atimes/South_Asia/JD29Df02.html
Speculators fuel bubble in global food costs
http://www.guardian.co.uk/business/2008/apr/20/globaleconomy.food?gusrc=...
Speculators Worsening World Food Crisis?
http://www.businessweek.com/globalbiz/content/apr2008/gb20080423_366709....
Speculators pump up oil, food, raw materials
http://www.libertypost.org/cgi-bin/readart.cgi?ArtNum=218035
Oil speculators push price to £5 gallon
http://business.timesonline.co.uk/tol/business/industry_sectors/natural_...
The real drivers of food, oil prices
http://www.nationalpost.com/todays_paper/story.html?id=472606
The Danger of Speculation
http://www.foxnews.com/story/0,2933,166038,00.html
