I ticked the wrong box

The Economist published a story called “The end of cheap food“.

It has a couple of interesting quotes:

• The Chinese consumer who ate 20kg (44lb) of meat in 1985 will scoff over 50kg of the stuff this year. That in turn pushes up demand for grain: it takes 8kg of grain to produce one of beef.
• This year biofuels will take a third of America’s (record) maize harvest. That affects food markets directly: fill up an SUV‘s fuel tank with ethanol and you have used enough maize to feed a person for a year.
• Increasing productivity means you need fewer farmers, which steadily drives the least efficient off the land.

The first two are interesting for their “facts”. The last is interesting because countries in the EU (as I have had it explained to me by British colleagues) will pay farmers to leave land fallow – ie, not grow crops or farm animals – this is in a drive to keep prices up in Europe – sort of a reverse subsidy. Local suppliers used to be encouraged to produce with subsidies, now foreign suppliers are discouraged (and this is particularly strange in my opinion because a country is giving away money offshore to not produce anything, whereas they could stimulate their own economy by spending the money internally – however this in turn will likely increase efficiency of farms, due to more funds available to farmers for RnD activity). What I find interesting (and surely obvious to all) is that increases in technology and production methods will yield greater productivity, increasing the supply, and thus, depressing the price even more. This will in turn require more intervention in terms of subsidies for supply in europe, and subsidies for lack of supply in other countries.

And of course, this all hurts the developing nations – they struggle to produce food in a manner that is as productive as the west due to lack of technology and advanced production methods.

The point I want to get across here is that subsidies aren’t good for anyone when viewing the global economy. Subsidies at home encourage oversupply. Subsidies offshore (for lack of production) artificially raise global prices and is fighting a losing battle due to advancement of production methods and technology.

My view is that if you can’t survive at a free market price, then you should seriously consider exiting that market and doing something else with your capital. Subsidies are not a long term solution. (Re)Investment is.

I’ve been reading The Economist’s “The World in 2007″ today. It looks like their predictions for 2007 in economics, business, politics – sort of a what’s going to happen in ’07.

One thing that I just get this feeling about when I read about the political situation in Europe in terms of predictions (and known events) for ’07, is that Europe is due some sort of flood of innovation. I’ve been seeing and hearing about the Europeans becoming more and more prevalent on the (please excuse the buzzword) Web 2.0 scene, and I just get this sense that something is going to happen this year. I’d like to think that Silicon Valley buzz will die down, in favour of a Silicon Continent buzz.

I’ve got little to no evidence to back this hope up, it’s just a feeling I have. It’s things like the success of ruby conferences in London and across Europe, some German entrepreneurs I know, the ubiquity and adoption of mobile services in Europe, the socialness of the Europeans, the proximity of so many different cultures and people and the overdueness of such an age. There is no reason why it can’t happen here, and I just feel the time is right.

I guess it’s just that 2007 seems to be a fairly significant year politically, and there is a lot of change in the air. I think we’ll see some movement from the Europeans in the innovation space.

I’ve been struggling for a long time to find a party, or ideology that I agree with politically. I have strong beliefs but I have struggled to find a ideology that they fit within. Today, I discovered it.

I reckon I’m a Libertarian.

The central tenet of libertarianism is the principle of self-ownership. To libertarians, an individual human being is sovereign over their body, extending to their life, liberty and property. As such, libertarians define liberty as being completely free in action, whilst not initiating force or fraud against the life, liberty or property of another human being. This is otherwise known as the non-aggression principle.

That’s exactly what I believe. I like free markets, and non-aggression, and consideration for others liberty (as defined above), and a belief that an individual is responsible for their own actions, and can make their own decisions. I like the concept of “user pays”, and I disagree with taxation to fund long term unemployment.

Yep, I’m a Libertarian.

Taking the Vietnam out of Iraq

Jenna sent me a link to this story on the BBC web site – it’s interesting. The parallels between the conflict in Vietnam and Iraq are clear to me. However, an exit strategy for this current conflict needs to be carefully executed. A cut-and-run is not an option. The country will be left open, and crippled. I personally would like the US out of there as soon as possible, not because I have any specific alliance to Iraq, but I just don’t think they should be creating and sustaining an unjust and illegal war. I am an advocate of a medium paced exit, with creation of stability within the country, and leaving it in a state so that it has a good chance of sorting itself out with a positive result. I don’t fancy the chances of a positive result if they just up and leave.

One thing that is very interesting from this story is this quote:

Second, there is a policy of trying to hand over responsibility to the local government in the midst of battle, not after it – this happened in Vietnam with the policy of Vietnamisation

I agree there is that parallel, but I don’t think that can be helped with the current conflict. With such a small, radical, underground enemy as the US have in Iraq, it’s going to be next to impossible to end the conflict, and then hand responsibility back.

I don’t believe another push by the US to destroy the insurgents is the way forward. That will breed more hate and contempt for the US in the country.

Any comments?