Has anyone else noticed the skyrocketing cost of food as of late? Bread/milk/eggs....all pretty basic things. The price of wheat has doubled due to increased demand in developing countries and the fact that farmers are growing less wheat in favour of corn or other crops that can be turned into bio-fuels. Also, the rising cost fuel is affecting the cost of transporting these very basic things....the things that we need to eat, to feed our families. It all goes back to energy/fuel/ and greed. Can anyone tell me what is wrong with this picture?

__________________
The world breaks everyone and afterward many are strong in the broken places. ~ Ernest Hemingway ...

Even worse, the price of hops and malted barley has increased dramatically!

true

__________________
The world breaks everyone and afterward many are strong in the broken places. ~ Ernest Hemingway ...

Well, we could go back to not sending food to the starving in the developing world, go back to living on farmettes and milking our own cow and raising our own yardbirds, but then we might be in danger of getting SARS or Avian Flu.

__________________
"What you think you thought you saw you did not see." Agent J, MiB - Manhatten Bureau

Nothing is wrong with the picture. It is the perfectly natural result of decisions that have been made. Now the wisdom of some of the decisions can be questioned, but those sorts of discussions can veer into politics, which is to be avoided in this forum. But to basically sum it up, that's what you get when high oil prices combine with a host of other factors in the system you have. You might consider changing the system, but again, they sorts of discussions are unavoidably political. Specific questions on economics that avoid politics are probably okay, but I'm afraid lots of people have trouble keeping politics and economics seperate. I guess it's because a lot of people are only familiar with economics from political discussions and don't even know how to discuss economics without dragging politics into it.

Specific questions on general economics should be okay, provided they stay on economics

The environmentalists have been saying that the cost of fuel should be higher for years. Now that they're finally getting their wish, everyone's griping that increasing fuel costs are causing increases in prices for other items.

Well, make up your minds, and choose which evil scenario you want, because you can't have it both ways.

__________________

Done:

http://www.nytimes.com/2007/09/29/world/29food.html

Note that while U.S. food aid certainly does help the hungry, it is not just done to feed the hungry. It is also a subsidy to American farmers. If it was just to help the hungry then the money would be used to buy the lowest cost food and use the cheapest transport available rather than using American food and American ships as current U.S. law requires.

Actually you can. An environmental tax can be used to increase the price of fuel and be rebated back to a nation's citizens, increasing the price of fuel while keeping their average spending power of citizens almost the same. This is quite different from a straight increase in the price of fuel.

We could always just use the nonfood parts of crops to make biofuels-- stems, husks, shells, pods, leaves. Not as efficient but much cheaper (since it's stuff we normally throw away), and doesn't effect our food costs at all.

__________________
"If this were play'd upon a stage now, I could condemn it as an improbable fiction."
Shakespeare, Twelfth Night
"The Mayan symbol for "book" looks a lot like a triple hamburger, but I've never seen them claiming it as proof the Mayans had Big Macs." - KaiYeves
"Distance doesn’t matter much in space, where if you just start a thing off with the right kind of shove, sooner or later it will get where you want it to go." -Frederik Pohl, Mining the Oort

Why do you think that is a good idea? You are taking money from people just to give it back. All that does is cause some of the money to go to supporting the govt agency that collects the money and writes the checks. Why not just let people keep their own money?

Why is wanting to get the best price for the use of your farm automatically greed?

I think that's kinda the definition of the word. It's placing monetary value ahead of other considerations, such as the well being of starving people.

__________________
"What you think you thought you saw you did not see." Agent J, MiB - Manhatten Bureau

Note that while U.S. food aid certainly does help the hungry, it is not just done to feed the hungry. It is also a subsidy to American farmers.

Food aid in response to a natural disaster (e.g. the tsunami a few years ago) is one thing. However, long term food aid is a disaster in itself for the country receiving it. The local farmers can't compete with free food so they get wiped out. That creates permanent dependency on food aid which is the opposite of what's needed.

However, even this comes at a cost: the combination of certain tillage practices and repeatedly stripping all the biomass off a site reduces the soil organic carbon content, affecting important structural properties of agricultural soils. Adding chemical fertilizer to the soil does not necessarily make up for the long term loss of humus.

It takes humus to make hummus.

__________________
"What you think you thought you saw you did not see." Agent J, MiB - Manhatten Bureau

Farmers rarely make enough to be able to stop worrying about money. If they give away too much, they become starving people themselves.

__________________
"If this were play'd upon a stage now, I could condemn it as an improbable fiction."
Shakespeare, Twelfth Night
"The Mayan symbol for "book" looks a lot like a triple hamburger, but I've never seen them claiming it as proof the Mayans had Big Macs." - KaiYeves
"Distance doesn’t matter much in space, where if you just start a thing off with the right kind of shove, sooner or later it will get where you want it to go." -Frederik Pohl, Mining the Oort

It's done to reduce the amount of polution. It would of course be pointless if applied to something innocuous. But a revenue neutral tax on carbon emissions would reduce carbon emissions while causing less disruption to the economy than mandating carbon emission cuts. To make an environmental tax revenue neutral the revenue collected can be directly distributed to citizens or the revenue can be used to lower existing taxes. Taxes that the government already collects and redistributes. The goal of sensible environmental taxes is to reduce costs for citizens, both direct and indirect. For example, a carbon tax could prevent tax increases used to pay for flood control and sea surge protection measures. No one has yet come up with a practical method for reducing carbon emissions that is clearly less disruptive to the economy than a carbon tax/credit.

The price of food was so cheap historically because of the cheap price of fossil fuels; necessary for transportation, fertilizer, harvesting, planting, etc. Now that the price of fossil fuels are going up, the price of everything that depends on it is going up too. We're going to find the true price of food, not the fake old price that it was.

At some point, it might make sense to not eat meat. Or transport food further than 100 km. The market will work this out.

Unfortunately, people around the world who can barely buy food today are going to suffer terribly.

__________________
Fraser Cain
Publisher
Universe Today - Free space news delivered by email every weekday.

We might see the suburban lawn replaced by the vegetable patch; produces food, and doesn't need to be mowed!

__________________
"If this were play'd upon a stage now, I could condemn it as an improbable fiction."
Shakespeare, Twelfth Night
"The Mayan symbol for "book" looks a lot like a triple hamburger, but I've never seen them claiming it as proof the Mayans had Big Macs." - KaiYeves
"Distance doesn’t matter much in space, where if you just start a thing off with the right kind of shove, sooner or later it will get where you want it to go." -Frederik Pohl, Mining the Oort

The price per barrel of oil is currently above the cost of producing "unconventional" oil sources and synthetic fuel from coal, so this isn't a sustainable price point.

__________________
I say there is an invisible elf in my backyard. How do you prove that I am wrong?

Disclaimer: Avatar is not an official NASA image and does not imply any specific interplanetary or interstellar capability.

The Leif Ericson Cruiser

At $100 a barrel the U.S. will spend about $730,000,000,000 on oil. That's out of a $13,000,000,000,000 GDP, or about 5.6% of GDP. If the price of oil doubled tomorrow to $200 and stayed there then Americans would be about 5.6% poorer. This would be painful, but won't be enough to stop people eating meat or to prevent food being transported long distances. Even if the United States passed a law banning the importation of foreign oil, people would still eat meat and transport food long distances, but there would be an extremely painful period of adustment as fuel efficient and electrified transportation infrastructure such as rail is built and your V8 becomes a garden shed. Non-conventional oil within the United States, such as oil shale and liqufied coal, would also be developed. The response of countries during Word War Two gives many examples of how economies can adapt to limited oil supplies .

Feh. Weeding my mom's vegetable garden always took far longer than mowing the lawn, and my mother's got a lot of lawn.

__________________
Gillian

"Now everyone was giving her that kind of look UFOlogists get when they suddenly say, 'Hey, if you shade your eyes you can see it is just a flock of geese after all.'"

"You can't erase icing."

"I can't believe it doesn't work! I found it on the internet, man!"

A regressive ocean tax--the farther the ocean moves away from your property, the less tax.

Yes, but you didn't have to use gasoline to mow the thing. At least, that is what I believe the point was.

But:

Link

I think the point was that not only do you not use oil to mow the lawn, you grow food there and so do not need to pay for the cost of transportation, including fuel costs.

__________________
Quaeso quousque humi defixa tua mens erit? Nonne aspicis, quae in templa veneris?

Growing and processing your own food is a lot of work. I had a peach tree and had too many peaches (and rotting peaches stink). The peach tree finally died of old age. I do have an orange tree outside the master bedroom. That's not too much work, but it's not a great location for the tree (it tends to go over the roof). Last year, for the first time, I had a great tomato crop. That was worth it because they were great tomatoes - far better than what you get in the store. I have olive trees, and never use them for food (just too much work).

The yard is enough work as it is. I don't need more.

__________________
I say there is an invisible elf in my backyard. How do you prove that I am wrong?

Disclaimer: Avatar is not an official NASA image and does not imply any specific interplanetary or interstellar capability.

The Leif Ericson Cruiser

Having a vegetable garden, chickens, rabbits and even pigs in the yards of working class people used to be quite common in towns. But as wages increased most people found that the effort just wasn't worth it. It was easier to work for an hour and use the money to buy food than it was to spend two hours working in the yard producing it. It is difficult to see how oil price increases would decrease real wages enough for backyard gardens to become popular again. I think most people would deal with oil related food price increases through substution rather than going back to growing their own food. The most oil intensive foods will increase more relative to other foods and people will eat less of them and more of foods that use minimal amounts of oil in their production and distribution. Disruptions in the importation of foreign oil could certainly cause oil prices to skyrocket and result in a severe recession, but the effects are likely to be temporary as people switch to fuel efficient and electrified transport, and so seems unlikely to me to cause a long term switch back to backyard vegetable gardens.

I just want the Invisible Hand to come over and till my garden.

__________________
If they can get you asking the wrong questions, they don't have to worry about the answers.

You'll have to wait until it's done slapping me around for losing so much in the stock market.

One other reason for the increase in food prices is the growing middle classes in China and India in particular. As people get wealthier, they start eating more meat, which is land-intensive. And that puts upward pressure on all agricultural items because they all use land.

I think that if the development continues, we will inevitably have to pay more for food, unless we can find a new source of land. :-)

There could be a silver lining, i.e. smaller food portions in the U.S. For people living outside of the US, going into a US supermarket can be a real shock.

__________________
As above, so below