TCS Daily

Damn That Market Mentality!

By Melana Zyla Vickers - August 11, 2005 12:00 AM

The cause of food shortages such as the one plaguing Niger right now may be a perplexing problem to Nobel Prize-winning economists. But its no mystery to the Washington Post news section. The Rise of a Market Mentality Means Many Go Hungry in Niger, declared a headline on the world news pages Thursday.

A government policy shift toward a free market; profiteering by traders freed from government price controls and other mechanisms that once balanced market forces; and the rise of sharper, more selfish attitudes as Niger reaches for a more materialistic, Westernized future, are to blame for the hunger crisis, according to the news article.


If those assertions are so, whats to be made of the following facts?


- 40-50% of the population of sub-Saharan Africa goes hungry every year, according to the United Nations. Most of that population lives under command-controlled economic conditions.


- No democratic-capitalist state has ever experienced a famine.


-The biggest non-African famines of the 20th century (China with 25-40 million deaths, Soviet Ukraine with 7-10 million deaths) as well as the most notable non-African famine of recent years (North Korea with 2-3 million deaths) were all the result of food requisitioning and economic control by communist governments.


- As South Asia and East Asia have, over the last 30 years, shifted away from command-controlled economies toward market economies, they've seen a reduction of their undernourished population from 43% to 13%.


In Niger specifically, the controls of a command economy are still very visible. The second-poorest country in the world derives almost half its income from international aid, and another substantial chunk from uranium exporting companies controlled by Nigers former colonial overlord, France. This is hardly a solid base for a free market. Price controls and government intervention in the grain market stopped only in the last decade, meaning a free market has not yet developed in full. The obstacles to new business development and foreign business participation are manifold. Much of the agricultural sector is still government-run. Worst of all, tiny Niger, in which only 15% of the land is arable and non-desert, depends on its neighbors for cereal imports every year. But this year, those command-controlled neighbors, Nigeria, Burkina Faso, and Mali, are restricting exports to Niger, despite the fact that theyve signed trade treaties against such hoarding. In other words, Nigers children are starving because of a failure to trade freely, and not a failure of the free market.


Nigers situation is nothing new. Command-controlled, totalitarian and authoritarian regimes have regularly bred famine because they cant respond quickly to resulting conditions or to bad harvests, and because their comfortable ruling elites ignore the starvation their policies cause, according to Nobel Prize-winning economist Amartya Sen, who wrote Poverty and Famines: An Essay on Entitlement and Deprivation. Other academics have argued the point even more forcefully, alleging that socialist regimes starvation of millions of people constitutes deliberate neglect, if not deliberate killing.


Nigers population isnt starving because of the nascent free market, as The Washington Post asserts. Its starving for the same reasons it always has: lousy geography, a shortage of grain, and the failure of the socialist-style economic players -- within Niger and around it -- to allow its people feed themselves.  


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