The Foreign Service Journal, March 2012

M A R C H 2 0 1 2 / F O R E I G N S E R V I C E J O U R N A L 27 2008. Rising oil prices have forced some smallholder farm- ers to cut back on planting crops because they can no longer afford to buy fertilizer, which is closely correlated with the price of oil. Approximately 15 percent of the increase in food production prices is due to higher energy and fertilizer costs. Price Volatility and Unrest Between 2006 and 2008, the World Bank tracked the reactions of 58 countries to food price volatility and found that 48 of them imposed price controls, consumer subsi- dies, export restrictions or higher tariffs. Half of the sam- ple group, 29 countries, responded by sharply curbing food exports. This lowered prices for their own citizens but drove them up elsewhere. While restricting food exports affords temporary relief to domestic consumers, particularly urban-dwellers, it ad- versely affects farmers, who must sell their stock at lower prices, and trading partners, especially net importers, through higher prices. The anticipation of shortages caused by export restrictions can also lead to hoarding around the world by farmers, traders and even consumers. Such hoarding offers short-term relief, but compounds the prob- lem by reducing production incentives, potentially encour- aging increased smuggling and corruption. If food prices continue to increase even after govern- ments take such steps, this tends to have political conse- quences. These vary widely because, as the old saying goes, all politics is local. But here are four key factors to watch: • the rapidity and steepness of food price increases • the level and extent of absolute poverty before price increases occur • the existence of functioning information feedback mechanisms so political leaders can get data easily when there is a food crisis in their country • the ability of the international humanitarian system to respond to sharp price hikes as soon as possible. Generally speaking, societal reaction will be sharpest in countries with large urban populations that are connected to international foodmarkets, which quickly feel the effects of price increases. In extreme cases, anger over food short- ages can foment electoral upheavals, coups and popular up- risings. The Origins of Famine This effect is particularly strong when widespread food shortages deteriorate into full-fledged famines, of course. Nobel Prize-winning economist Amartya Sen opens Poverty and Famines: An Essay on Entitlement and Dep- rivation (Oxford University Press, 1983), his celebrated statement of exchange entitlement theory, with this defini- tion of the phenomenon: “Starvation is the characteristic of some people not having enough food to eat. It is not the characteristic of there being not enough to eat. While the latter can be a cause of the former, it is but one of many possible causes.’’ Famines occur when large numbers of people in a coun- try or region suffer a rapid, substantial reduction in caloric intake, causing widespread death. The phenomenon is sel- dom caused simply by shortages of supplies, but rather by the inability of large groups of people to obtain food, most often due to extreme poverty. Absolute poverty increases the vulnerability of people to price shocks that lead to famine because they lack the means to absorb reductions in their income or increases in prices. The world’s poorest people spend up to 70 per- cent of family income to buy food, so even small changes in the economic balance between their income, assets, the F OCUS Andrew S. Natsios served as director of the U.S. Agency for International Development’s Office of Foreign Disas- ter Assistance from 1989 to 1991, assistant administrator of the Bureau for Food and Humanitarian Assistance (now the Bureau of Democracy, Conflict and Humanitarian As- sistance) from 1991 to 1993, and USAID Administrator from 2001 to 2006. Vice president of World Vision, the largest faith-based nongovernmental organization in the world, from 1993 to 1998, Ambassador Natsios later served as the U.S. special envoy to Sudan from October 2006 to December 2007. Since 2006, Amb. Natsios has been a professor in the practice of diplomacy at Georgetown University’s Walsh School of Foreign Service, and is also a senior fellow at the Hudson Institute. He is the author of numerous articles on foreign policy and humanitarian emergencies, as well as three books: U.S. Foreign Policy and the Four Horsemen of the Apocalypse (Center for Strategic and International Studies, 1997), The Great North Korean Famine (U.S. In- stitute of Peace, 2001) and Sudan, South Sudan, and Dar- fur: What Everyone Needs to Know (Oxford University Press 2012). This article is an updated and abridged ver- sion of one he wrote with Kelly Doley, titled “The Coming Food Coups,” which the Washington Quarterly published in January 2008.