There has been a rapid increase in food prices over the last couple of years, seen most dramatically in the recent 30% one-day rise in the price of rice worldwide. This is putting tremendous pressure on the poor and is leading to instability in countries around the world. There have been violent demonstrations–and equally violent government responses–to food rioting in Egypt and Haiti in the last couple of weeks. They may be but a harbinger of the economic and political instability to come. Here is a report from the BBC, in which an expert argues that IMF policies have contributed to the rise in food prices:
“Poor countries need to invest heavily in agriculture to feed their people. There’s been a dearth of investment in agriculture in poor countries, mainly because of IMF and World Bank policies…”
Here is an excerpt from a documentary on the World Bank and the IMF, entitled “The New Rulers of the World,” by John Pilger.
…And at no extra cost, US Congressman Ron Paul (R-TX) unloads on the World Bank with both barrels:
“The World Bank is an organization that is not devoted to capitalism, or to the free market, but to state-run corporate capitalism…the World Bank promotes managed trade by which politically connected individuals and corporations enrich themselves at the expense of the poor and the middle class.”
Anticipating the end of World War II, world leaders gathered in the New Hampshire town of Bretton Woods to create the financial architecture of the post-war global financial system. The three main pillars were the World Bank, the IMF (both of which were created) and the International Trade Organization (this was never built but the governing philosophy behind it eventually gave rise to the General Agreement and Trade and Tariffs (GATT), which morphed into the World Trade Organization (WTO). We’ll discuss these institutions in much more detail beginning Monday.
Here is an excerpt from a newsreel describing the meetings at Bretton Woods in 1944: