Agriculture and Energy Subsidy in US and Europe and the World Food Crisis

Abstract

This article empirically demonstrates that the European and US globalisation and capitalism in agriculture, food and the agro-industry since the mid-20th century have been supported and powered by subsidies (which at present is 50 per cent of the value of agricultural production in Europe and the US) and technological advances in the cultivation of mainly grains (wheat, corn, rice and barley), oilseeds (especially soybeans), milk and cotton. This led to a major expansion in the periphery of the standard food and textile industries dependent on imports of commodities at artificially low prices and a pattern of food consumption with a growing imported and subsidised component for the urban and rural low-income masses. With the emergence of agro-fuels prompted by OECD countries has begun a process of unification of the global market for food with the fuel or energy market in general. Our proposal—keeping in mind the recent experience of the recession that could threaten to become a global depression like in 1929—is a design to replace the current one-agri-food and energy global systems, seeking the restoration of the validity of the real comparative advantages.