Price Wars: How Prices Caused the Crisis | Rupert Russel

[@davidbarry6900]

Rupert makes excellent points about the commodity pricing mechanisms and fears of a future problem actually creating problems in the present, through pricing, speculation, and panic. Rachel also makes a lot of excellent points and challenging questions to keep the discussion on topic and connected with climate change. The discussion on the Ukraine war impact on the food prices is a bit mischaracterized and with some details incorrect though. It isn't only a matter of the commodities market making a bad situation worse (although that is probably also true). The Russian and Ukrainian wheat exports are closer to 7% of world production (refer to wikipedia). This would be a difficult volume to try replace from reserves (or generous donor countries) in any year. Ukraine is likely to be a net IMPORTER this year (although Russia should still be able to export some of its harvest, it won't all go offline). The markets are also pricing in the impact of fertilizer shortages and high fuel prices. Between all three factors (including impacts to wheat and seed oil exports via the Black Sea), analysts like Peter Zeihan are expecting something like a 20% decline in harvests this year, and worse next year - especially in Africa, where most of the arable land produces very little yield unless you throw on tons of fertilizer. (China and Brazil are also in this situation, and will also be affected.) So, markets - and countries - are panicking in advance, trying to avoid a famine and the likely associated political turmoil for themselves later this year. "Food nationalism" is already happening, where some countries are restricting food exports to try secure their own food supplies. As we saw during the pandemic, this is going to be another factor that just messes up global supply chains in general - not to mention making life really difficult for millions of people in countries that normally import a lot of their fuel and food. Rupert's ideas of regulating commodities markets to be less volatile and more equitable are probably achievable in SOME regions, e.g. within the USA (if the political system were ever functional) or the EU (you'd need both strong regulations and low corruption), but it's hard to imagine a utopian system functioning well at a global level anytime soon. There are usually too many local political issues and aspects of crime or corruption at play in the global market though. We'd probably have to try it out within a few small countries first, then a region like the EU next; see if it works, and then try to expand it to larger regions. From the history of agricultural commodities, and all the acrimony over dumping and subsidies and overproduction and national protectionism though, I'm not optimistic. The idea is only likely to work easily within bounded regions where a product is both supplied and in demand locally, with no outside competition. In a sense, Rupert is advocating for a social and economic system a little like that of Star Trek (original series, not the darker modern reboot). This is not a criticism, but rather an aspirational goal. After all, if we can achieve and even improve on the communicator gadgets envisioned by screenwriters and producers of the 1960's, and we're working on something like the Star Trek hand-held diagnostic devices already, why not also aim for a better economic and social system too? (I'm not in any sense saying that this will be easy, of course.)

[@VladBunea]

“We need degrowth, we need to contract in a market economy - is a logical fallacy” - Rachel, it seems you misunderstand degrowth again. Degrowth is asking for planned downscaling of production and consumption in the Global North, not everywhere. Please don’t get so stuck against the word “degrowth”. It comes from physics. We just cannot continue material growth in high income countries. It’s math and physics. One of way or another material growth needs to drastically decrease and stop.

[@michaelhusted4974]

Root cause is peak production oil interacting with ecological overshoot including rapid climate change. The prosperity economy is ending.