I have occasional passion for tinned soups. Being an idiot with some intellectual slants, this has led me to ‘tinned soup economics’. Our “governments” are ‘printing money’ to some massive tune and “our banks” are awash with the stuff, seeking to make more money out of it than the mere fees they extract in “buying” it. This all leads to my Heinz Tomato Soup four packs surging up in price more or less overnight (and the cheaper stuff from Aldi). My inflation rate is highly food-related, as I’m not much of a consumer. Things must be much worse for those closer to the bread line. Bank of England figures at 5 and 7% are puny in comparison with what many of us are experiencing as shoppers. My petrol allowance doesn’t go up, but petrol does. I’m worse off.
There are some scary figures about in The Economist on world food prices. Many of my former economist colleagues ‘aspire’ to teaching students to be able to read what the Grauniad, Times and Economist print on the subject. I have flattened my expectations to soup over recent years and why we pump irreplaceable helium into space via children’s balloons. Balloons are important in economics, as bubbles burst. If you can answer the question, ‘is there any such thing as free soup’, you are probably a better economist than me, or those who believe economics is about making money from demand. There are big questions about why my average can of soup went from 25 pence to over 50 pence. Did I set a trend and demand double?
World food prices have risen by around 50% in the last year. It’s much worse for wheat prices. Countries that import a lot of wheat per capita happen to have ‘street unrest’. Whilst my ‘Tinned Soup Price Liberation Front’ is not yet active on the streets of Britain, bread prices may have some part in Tunisia, Egypt, Bahrain and food riots elsewhere. Demand for wheat has not doubled, but its price has. One can ponder on how this has been ‘manipulated’. My guess is that it has to do with surplus capital in the banks that have just “borrowed” so much from our public purses (in the end our pockets). They have form for inflating property prices, including buildings designed for non-existent Irish people, after all. I think it likely that the cost of wheat is particularly high where it is imported in great quantity per capita. I have the theory, but lack the data. The broad brush is that something like the property fraud is going on, because property no longer cuts the accounting mustard, even with banks ‘marking to model’ rather than market (that is, not showing their true losses and hoping we will stand them again). Food may somehow be the latest Ponzi.
This said, places like India and China, which generally produce their own wheat, may be about to increase demand. Perhaps a third of China’s wheat-bowl is under drought conditions. The pictures in this link are worth a look. http://shanghaiist.com/2011/02/10/in_pictures_chinas_worst_drought_in.php?gallery0Pic=2#gallery
I have explanations to offer in detail. The gist is we have long conflated democracy, in the West, with a politics that is really about bread and circuses through which rule of a libidinal economics takes place. This all has a long history. My guess is that the bowl of soup with which I start my first meal on our long-weekend and the roll and butter, have greater connection with bwanking bonuses than I will bother to think in time off with Sue. The answers are not really going to be “intellectual”. I hope to explain why.
Cameron and Osbourne now look (inside a year) like Tory Twaddle Twins. Their “plan” is to turn us into the ‘New Ireland’, a tax haven for global corporates, maybe like the Caymans without the weather. Blair was the ‘third twin’, which makes sense in mark to model accounting. Our laws have been changed to accommodate this, with companies now allowed to count earnings abroad for tax purposes here. We have no politics in which to contest any of this, other than the drivel forced on us by people presenting themselves in suits and an accessorised media filling air-time with 365 24/7 undergraduate pouting. The basic UK bid is to show us entirely unlikely to have politics meaningful to people, and politicians easily bought with jobs in the boardrooms of banks and big companies intent on capitalizing on Britain as an offshore financial brothel. Even FIFA might consider relocation here!