Freedom Was Giving Us Prosperity and Full Bellies. Political Leaders Squandered What We Had.
Government officials broke the world, and we’re all paying the price.
The good news is that Ukraine, a breadbasket country for much of the world, is shipping food again. This has nudged global food prices off highs that put sufficient calories out of the reach of too many people. The bad news is that supply chains remain disrupted, Russia's invasion of its neighbor still plays havoc with grain and energy markets, and food remains too expensive. Wealthy countries foresee hard times, and the outlook is worse for others who, until recently, were climbing out of poverty and hunger.
"The next five to ten winters will be difficult," Belgian Prime Minister Alexander De Croo warned his countrymen this week. "A very difficult situation is developing throughout Europe."
Anybody seeking a little more cheer made a mistake if they looked to France, where the forecasts are just as depressing.
"I believe that we are in the process of living through a tipping point or great upheaval," French President Emmanuel Macron told his cabinet. "Firstly because we are living through … what could seem like the end of abundance."
Both politicians referred to energy prices soaring because of economic skirmishes with Russia over that country's invasion of Ukraine as well as long years of bad policies that made much of Europe dependent on fuel from the giant to the east. But pandemic-era government spending sprees and supply chains kneecapped by COVID-19 lockdowns and war have the continent's economies sputtering as prices rise overall. If affording the necessities of life is becoming a problem for the comparatively wealthy nations of Europe, imagine what it's like for the rest of the world.
"Record high food prices have triggered a global crisis that will drive millions more into extreme poverty, magnifying hunger and malnutrition, while threatening to erase hard-won gains in development," the World Bank noted on August 15. "The war in Ukraine, supply chain disruptions, and the continued economic fallout of the COVID-19 pandemic are reversing years of development gains and pushing food prices to all-time highs."
There is some improvement on this front. After months of blockaded ports, mined shipping channels, and trapped shipments, the United Nations and Turkey brokered a deal to let Ukraine's food flow to purchasers around the world who rely on the country's foodstuffs. The first cargoes began crossing the Black Sea just days ago. That has world food prices backing off their peaks.
"The FAO Food Price Index (FFPI) averaged 140.9 points in July 2022, down 13.3 points (8.6 percent) from June, marking the fourth consecutive monthly decline," the U.N.'s Food and Agricultural Organization (FAO) announced earlier this month. "Nevertheless, it remained 16.4 points (13.1 percent) above its value in the corresponding month last year."
"Leading the decline, world wheat prices fell by as much as 14.5 percent in July, partly in reaction to the agreement reached between Ukraine and the Russian Federation to unblock Ukraine's main Black Sea ports, indicating the imminent resumption of grain exports from Ukraine," the FAO added.
That's great, but Ukraine's food exports remain at about half of 2021's level, according to data from the country's Agricultural Ministry. And Russia's invasion hampers food production by chasing away farmers, or through deliberate targeting of crops for destruction. Agricultural firms can only sell what they grow, not what was never planted or that burned in the field.
Unfortunately, political officials seeing a potential disaster have done their best to make it worse.
"The global food crisis has been partially made worse by the growing number of food trade restrictions put in place by countries with a goal of increasing domestic supply and reducing prices," adds the World Bank, which predicts "prices at historically high levels through the end of 2024 exacerbating food insecurity and inflation."
It's impossible to overstate what a dramatic and unpleasant turnaround this is from recent history. Humanity had been making progress in reducing hunger and building prosperity in recent decades.
"In the developing regions, the prevalence of undernourishment—which measures the proportion of people who are unable to consume enough food for an active and healthy life—has declined to 12.9 percent of the population, down from 23.3 percent a quarter of a century ago," the FAO noted in 2015.
Likewise, the number of people living below the poverty line around the world plunged from 1.93 billion in 1991 to 659 million in 2018. What produced this remarkable improvement in human fortunes?
"It was liberalism, in the free-market European sense," economist Deirdre N. McCloskey wrote in 2016. "Give masses of ordinary people equality before the law and equality of social dignity, and leave them alone, and it turns out that they become extraordinarily creative and energetic."
Since then, though, pandemic lockdowns interrupted the flow of goods and services around the world, geopolitical tensions and concerns about supply drove additional interference with trade, and ill-considered environmental policies impeded agriculture and energy. And then Russia revived large-scale aggressive warfare and all of its add-on effects.
Not every recent wound was foreseeable or avoidable. Droughts and bad weather that choke off crop yields have always been a constant and unpredictable menace. Nobody wanted a pandemic. And the decision to invade Ukraine rests in the hands of Russia's authoritarian President Vladimir Putin and his cronies.
But thousands of years of scratching in the dirt in search of sustenance should have taught us that prosperity and full bellies are elusive qualities available only when the conditions are right. We can't control every factor that determines whether we are poor or rich, but we can "give masses of ordinary people equality before the law and equality of social dignity, and leave them alone" to maximize our chances no matter what nature and dictators send our way. Leaving people free to innovate, trade, and produce gives us the best chances of success no matter what else happens. It's especially important to leave people alone amidst events we can't influence so as to minimize disruptions.
Of course, that's not what political leaders have done.
So, in 2022, wealthy nations face a possible "end of abundance" while the poor may suffer a return of "extreme poverty, magnifying hunger and malnutrition." And this happened largely because of bad political choices in a world that very recently thought it had escaped poverty and starvation.