Broadening the resource curse: a note on grain imperialism

Internautes,
This blog does not use the term imperialism lightly. But what else do you call the trend highlighted in this week's economists consisting of nouveau-riche nations buying up the best land in less-developed but better-endowed nations to establish their food security beyond the level world markets provide? This is first of all an affront to the principle of market competition for all that is the only real alternative to various styles of empire in an interconnected world. It is secondly an insult to the idea that democracy might just provide benefits to the citizens of less-affluent nations. Those who would argue that this is the only way to get green revolution productivity out of the land just aren't thinking. They may be calculating things such as the low probability that democratic regimes capable of providing the land reform and research into methods of locally implementing green revolution techniques, and creating functioning markets in commodities and labor capable of getting that land productivity for the rest of us will arise. But their assumptions are wrong, especially if they are based on the econometric methodology of calculating future probabilities based on the past course of a variable alone. This may be rather valid for the US stock market, but for the probability of enough information spreading to the global poor for them to demand better, in the middle of an internet revolution, it is dead wrong? Have not statistical expectations of people's abilities to implement self-determinacy been rather trumped in the past ten years? Peaceful elections in several African countries are but the happiest example. Calculating is not thought about politics. Thought about politics involves continual revision of assumptions after the natural fashion of any thought.


But there are better reasons to oppose this trend than just a better calculation of how likely the green revolution is to get implemented under the policy as opposed to without the policy; and note that the policy does not guarantee any sort of success at this goal. This latest episode in the periodic starvation due to overpopulation scare of post-Malthusian history is essentially communistic. Governments decide what they need and get others to grow it for them. Those of us who think the market allocates resources better than government should be weary of being told just how much rice China or Qatar 'needs' for its ill-defined security or why grain is 'more important' than rubber or coffee or tobacco or some other apparent luxury. If these nations want to contribute to our food security, why don't they work on annual-perrenial hybrids? That is one of the promising avenues of American research into dealing with land-exhaustion, fertilizer-depletion, and behind it all the need for organized energy. (Current-day fertilizer is made largely of petroleum). Why, might it just be because these nations are not actually internally capitalistic by lack of well-functioning internal markets? This blogger thinks so. The disaster of state-thought is upon us once more, and looking beyond its' own borders once more. That is what statist regimes do, point blank and simple.

The Economist is wrong to talk of this episode as at least a possible broadening of the benefits of efficient capitalism to places that don't have it. Efficient capitalism cannot be imported, as even the Bush administration acknowledged. I have outlined the inefficiency of the current method. Now I must say a word about the real method as it was employed from England to Thailand (hey, they both have neolithic tin mines too). In the real method, land to which property rights were previously vague is put in the hands of a definite owner. That much , I acknowlege, is being done under this new form of imperialism. However, the definite owner is not brought in by the government. He or she wins a land battle through ordinary legal means by virtue of local citizenship, or perhaps high legal status; no one ever said capitalism was an ethical advent in and of itself. In the real method, furthermore, 'security' in a single good for some entity is not the aim. The aim is the enrichment of the person who wins the battle, and they will grow a particular crop on it with market aims in mind. As it has actually happened, it took place when a local capital system was in place. And probably some other stuff I am missing, which also just illustrates a little law of human development; what is deliberately crafted to look exactly like a thing from the outside is as unlikely to be that thing as the Pygmalion method is to create artificial life.

When countries' reproducable resources are treated like money in the bag for the grabber just like irreproduceable subterranean cachets, the resource curse is extended beyond its natural bounds. It would be difficult to provide precise accounting of how exactly this will happen, but the idea is simple. If a foreigner starts buying up the land and paying taxes on it, those taxes become as oil revenues. The jobs on the land, if they are available by virtue of the foreign government hireing local workers rather than their own, are likely not to be part of a competitive labor market, if none outside the system is allowed to exist, and will thus their landing becomes a favor to cultivated from the foreigners. All this is exactly what the resource-cursed third world doesn't need.

But what else could one really expect a bunch of nouveau-riche nations to do than act just like the nouveau riche England and France of times past? The world is not an economically rational place, but that is no reason not to find policies to oppose this sort of historical repetition, to which mere knowledge of the thing will not yield a medicine. I'm with the left on this one. Let's start talking about human rights and international legality for displaced farmers, and stop using those terms to decry only the actions of nations of long-established wealth, whose violations are much less egregious than those of rising stars for simple, acultural reasons involving the universal historical pattern of development.