Sunday, January 27, 2013

Has America Become an Authoritarian State?

Reporting Factory Farm Abuses to be Considered "Act of Terrorism" If New Laws Pass

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How do you keep consumers in the dark about the horrors of factory farms? By making it an “act of terrorism” for anyone to investigate animal cruelty, food safety or environmental violations on the corporate-controlled farms that produce the bulk of our meat, eggs and dairy products.

And who better to write the Animal and Ecological Terrorism Act [5], designed to protect Big Ag and Big Energy, than the lawyers on the Energy, Environment and Agriculture Task Force at the corporate-funded and infamous American Legislative Exchange Council [6] (ALEC).

New Hampshire, Wyoming and Nebraska are the latest states to introduce Ag-Gag laws aimed at preventing employees, journalists or activists from exposing illegal or unethical practices on factory farms. Lawmakers [7] in 10 other states introduced similar bills in 2011-2012.  The laws passed in three of those states: Missouri, Iowa and Utah.  But consumer and animal-welfare activists prevented the laws from passing in Florida, Illinois, Indiana, Minnesota, Nebraska, New York and Tennessee.

In all, six states now have Ag-Gag laws, including North Dakota, Montana and Kansas, all of which passed the laws in 1990-1991, before the term “Ag-Gag” was coined.

Ag-Gag laws passed 20 years ago were focused more on deterring people from destroying property, or from either stealing animals or setting them free. Today’s ALEC-inspired bills take direct aim at anyone who tries to expose horrific acts of animal cruelty, dangerous animal-handling practices that might lead to food safety issues, or blatant disregard for environmental laws designed to protect waterways from animal waste runoff. In the past, most of those exposes have resulted from undercover investigations of exactly the type Big Ag wants to make illegal.

Wyoming’s HB 0126 [8] is the perfect example of a direct link between an undercover investigation of a factory farm and the introduction of an Ag-Gag law. The bill was introduced mere weeks after nine factory workers at Wheatland, WY-based Wyoming Premium Farms, a supplier to Tyson Foods, were charged with animal cruelty following an undercover investigation [9] by the Humane Society of the United States (HSUS). HSUS activists videotaped workers kicking live piglets, swinging them by their hind legs and beating and kicking mother pigs. Charges were filed in late December. In January, State Rep. Sue Wallis and Senator Ogden Driskill introduced Wyoming’s Ag-Gag bill which would make it a criminal act to carry out investigations such as the one that exposed the cruelty at Wyoming Premium Farms.

Wallis and Driskill both have ties to Big Ag. Wallis was the subject of a conflict-of-interest complaint filed in 2010 by animal welfare groups. The groups accused her of improper and fraudulent abuse of her position as a legislator after she introduced a bill allowing the Wyoming Livestock Board to send stray horses to slaughter [10]. At the time she introduced the bill, Wallis also was planning to develop a family-owned horse slaughter plant in the state. Both Wallis and Driskill are members of the Wyoming Stockgrowers Association. Driskill has accepted political contributions [11] from the livestock industry and Exxon Mobil, a member of ALEC.

Most of the Ag-Gag laws introduced since 2011 borrow the premise, if not the exact language, from model legislation designed by ALEC. ALEC’s sole purpose is to write model legislation that protects corporate profits. Industry then pushes state legislators to adapt the bills for their states and push them through. The idea behind the Animal and Ecological Terrorism Act [5] is to make it illegal to “enter an animal or research facility to take pictures by photograph, video camera, or other or other means with the intent to commit criminal activities or defame the facility or its owner.”

In other words, these laws turn journalists and the investigators of crimes into criminals.

Many of the legislators involved in ramming through state Ag-Gag bills have ties to ALEC [12], including Missouri’s Rep. Casey Guernsey. Guernsey’s top donor in 2010 was Smithfield Foods, itself a target of undercover investigations that exposed widespread abuse of pigs. Of the 60 Iowa lawmakers [13] who voted for Iowa's Ag-Gag laws, at least 14 of them, or 23%, are members of ALEC

ALEC’s interest in large-scale factory farm operations, or in industry-speak, Confined Animal Feeding Operations (CAFOs), can be traced to one of its staunchest members, Koch Industries.  Koch Industries once owned the Koch Beef Company, one of the largest cattle feeders in the U.S. When neighbors of one of the company’s huge cattle-feeding operations opposed a planned expansion, claiming it would pose health concerns, Koch persuaded local legislators to rule in its favor. ALEC subsequently wrote the  “Right to Farm Act [6],” a bill to bar lawsuits by citizens claiming that neighboring farms, including industrial farms, are fouling their air and water.

Ag-Gag bills a threat to animals, public health and the environment

Under U.S. laws, farm animals don’t get the same protection as other animals, such as dogs and cats. Anti-free speech Ag-Gag bills only serve to leave farm animals even more vulnerable to the routine pain and suffering on factory farms. The three federal statutes that address animal welfare, including the U.S. Animal Welfare Act, do not apply to animals raised for food.  The Humane Methods of Slaughter Act regulates animals raised for food, but applies exclusively to slaughterhouses, where animals may spend only a short time before they are killed. That leaves the states to regulate the often-barbarous treatment of animals raised for food.

But as we’ve seen with the Ag-Gag bills, state laws often are written by big corporations. Nowhere is that more obvious than in states where cruel methods of treating animals are exempted from state laws on the basis of their being classified as “customary.” Who decides [14] if a certain practice is “customary” even if most thinking people would consider that practice cruel? Corporations that own and operate CAFOs in that state.

Apart from the obvious ethical concerns, Ag-Gag laws also threaten public health and the environment, and undermine workers’ rights and free speech laws. Undercover investigations at factory farms have exposed the mishandling of meat, eggs and milk in ways that could potentially lead to health risks including mad cow disease, salmonella, e-coli and others. One investigation [15] in Chino, Calif., revealed widespread mistreatment of “downed” cows – cows that are too sick or injured to walk. The facility is the second-largest supplier of beef to USDA's Commodity Procurement Branch, which distributes the beef to the National School Lunch Program.

Ag-Gag bills also keep employees and others from blowing the whistle on environmental violations. Huge amounts of waste are generated by the billions of cows, pigs and chickens on factory farms. Much of that waste, full of antibiotics, growth promoters and synthetic hormones, finds its way into our waterways and municipal water supplies. State and federal laws require CAFOs to minimize their environmental damage, but the laws are often not enforced. One of the ways to expose violations is through undercover investigations.

And then there’s the matter of free speech. The American Civil Liberties Union has been an outspoken opponent of Ag-Gag bills. In a letter [16] opposing the proposed Ag-Gag law in New Hampshire, the executive director of the New Hampshire Civil Liberties Union wrote that the proposed law “has serious implications for two fundamental rights protected by the U.S. and New Hampshire constitutions: the right to freedom of expression and the right against self-incrimination.”

There’s still time to stop Ag-Gag laws in New Hampshire, Wyoming and Nebraska

The majority of Americans see Ag-Gag laws for what they are: just another attack on consumers’ right to know. According to a poll [17] conducted last year by the American Society for the Prevention of Cruelty to Animals (ASPCA), 71% of Americans oppose the laws. When consumers learn that 99% of the animals raised for food are raised in factory farms, they generally agree that lawmakers should focus on strengthening animal cruelty laws, not prosecuting the whistleblowers.

It was public outrage that killed proposed bills in seven states last year. Here are the three latest bills to be introduced, and links to petitions telling lawmakers in New Hampshire, Wyoming and Nebraska to reject the proposed laws:

New Hampshire: HB110 [8] 

Primary sponsor: Bob Haefner (R) ; Co-sponsors: Majority Leader Steve Shurtleff (D), Rep. Tara Sad (D), Senator Sharon Carson (R), and Bob Odell (R)

This is a 7-line bill written to look as if its main concern is the protection of animals. However the bill would require whistleblowers to report animal abuse and turn over videotapes, photographs and documents within 24 hours or face prosecution – a clear attempt to intimidate and deter people from conducting undercover investigations. Lawmakers know that in order for anyone to prove a pattern of abuse in factory farms, they must document repeated instances of cruelty. A video or photograph of only one instance will be dismissed as a one-time anomaly, which will get the agribusiness company off the hook.

Sign the petition [18] to stop New Hampshire's Ag-Gag bill.

Wyoming: HB0126 [19] 

Co-sponsors: Rep. Sue Wallis (R), Sen. Ogden Driskill (R)

Introduced within weeks after nine workers at a Wyoming factory farm were charged with abuse [9]. The bill’s sponsor, Rep. Sue Wallis, is planning to build horse slaughterhouses in Wyoming and other states. If this bill had been law in 2012, it would have prevented activists from exposing horrific acts of cruelty at Wheatland, WY-based Wyoming Premium Farms, a supplier to Tyson Foods.

Sign the petition [20] to stop Wyoming's Ag-Gag bill.

Nebraska: LB 204 [21]

Introduced by Sen. Tyson Larson (R), Sen. Scott Lautenbaugh (R), and Sen. Ken Schilz (R)

The bill would make it a Class IV felony for any person to obtain employment at an animal facility with the broadly defined "intent to disrupt the normal operations," It would require animal abuse reports to be filed within 12 hours. Co-sponsor Sen. Launtenbaugh has advocated in the past for horse slaughtering.

Sign the petition [22] to stop Nebraska’s Ag-Gag bill.

Johnson & Johnson Knowingly Sold Faulty Hip Implants

Medical products company Johnson & Johnson was aware of an egregious fault in a hip replacement implant it sold, newly released court documents reveal. An internal company analysis conducted in 2011 found the metal device had a failure rate of 40 percent within five years of implantation.

Since 2008, executives at Johnson & Johnson’s DePuy Orthopaedics division knew of problems with the implant, called Articular Surface Replacement (ASR). This was a year before the company stopped production, and fully two years before recalling them. At the time of its analysis, the New York Times reported Tuesday, Johnson & Johnson was publicly downplaying findings from a British medical implant registry about the ASR’s high early failure rate.

“The company’s analysis also suggests that the implant is likely to fail prematurely over the next few years in thousands more patients,” the Times reported, “in addition to those who have already had painful and costly procedures to replace it.”

The analysis was included in documents, motions, and pre-trial depositions released January 18 as a result of the first of many lawsuits over the implant failures. The trial is scheduled to begin Friday in California Superior Court in Los Angeles.

Approximately 93,000 patients worldwide received the implants, 37,000 of them in the US. Some 10,100 US patients are expected to sue.

In 2009, DePuy executives decided to phase out the device after the federal Food and Drug Administration sent a letter requesting additional safety data about the implant. In addition to the failure rate, the FDA cited concerns that the device was causing “high concentration of metal ions” in the blood of patients. The FDA has no ability to enforce a recall.

Rather than halt sales of the hip implants, Johnson & Johnson continued to sell off its inventories.

The company attempted to deal with the failures on an individual basis through out-of-court settlements and special charges running into the billions of dollars. DePuy has offered to pay for replacement procedures.

The ASR is no longer recommended in standard hip replacement surgeries because the all-metal implants have been found to grind together and release metallic debris that damage bone and cause tissue death.

A DePuy engineer stated in pretrial testimony released last week that company executives were aware in 2008 of the high levels of metal ions.

DePuy executives have maintained that the company responded in a timely and appropriate way to the ASR defect. When the implant was recalled in 2010, Johnson & Johnson said it was responding to data from the National Joint Registry of England and Wales showing that the ASR was failing prematurely at a higher rate than other implants—but the registry’s estimate was lower than DePuy’s internal analysis suggested.

When the British registry revised its failure rates upward to one in three, closer to the company’s own data, DePuy publicly challenged the estimate. Other medical organizations also projected similarly high failure rates for the ASR.

The revelation is only the latest in a long line of medical scandals in the US. The players are familiar: a billion-dollar company knowingly selling a faulty product; the federal regulatory agencies subordinate to the industry; and the mass of the population who are victimized in the name of profit.

The problem may be far wider than the DePuy products. While all-metal devices now account for only 5 percent of hip implants, an estimated 500,000 patients in the US have received artificial hips that may fail over the next decade.

The FDA has proposed clinical trials for metal hip implants to justify their use, but the impact of such a proposal will have little impact on medical manufacturers, and as the New York Times reported January 17, “industry lobbyists may oppose its adoption or seek to modify it.” Moreover, agency officials told the Times, “it would most likely take a year for the rules to be finalized; after that, producers will have 90 days to submit clinical data to support a device’s safety and effectiveness.”

The DePuy trial comes on the heels of a nationwide fungal meningitis outbreak that has stricken hundreds with severe infections and killed dozens. The cause of the outbreak was fungus-contaminated steroid medication produced by New England Compounding Center, a Massachusetts compounding pharmacy, which was not under FDA oversight because of its classification as a pharmacy. The company had been cited for violating safety standards since 2006, but was not prevented from continuing to produce tainted drugs. At least 14,000 people were put at risk of developing meningitis.

Many products that have been approved by the FDA have also caused death and suffering. Merck’s arthritis drug Rofecoxib, marketed under the brand names Vioxx, Coexx and Ceeoxx, received FDA approval in 1999 and was a top seller around the world for the next five years. More than 80 million patients took the drug, generating sales revenues of $2.5 billion. In 2004, Merck withdrew Rofecoxib after it was revealed that the company knew from the beginning that the drug caused increased risk of heart attack and stroke. As many as 140,000 people developed serious heart disease, and some 60,000 people died as a result of taking the drug.

In October 2012, the FDA announced a recall of a generic high-dosage version of Wellbutrin XL, a widely prescribed anti-depressant, because it did not work and produced unusual side effects. The drug had been sold since the FDA approved it in 2006 without testing it.

In November, drug company Ranbaxy announced a recall of its generic version of the cholesterol-lowering drug Lipitor because the pills contained glass particles, a problem the FDA did not catch when it approved the drug. Lipitor is the most prescribed drug in the US, meaning that thousands of patients were likely prescribed the cheaper generic version of the drug.

The FDA approved 39 new drugs in 2012, the most in 16 years, 10 of them on “fast-track” status.

US Debt Ceiling Maneuver Sets Stage For New Cuts

The Republican-controlled House of Representatives pushed back the deadline for raising the federal debt ceiling Wednesday, voting for a measure that would suspend the current limit on federal borrowing until May 19. The vote averted an immediate crisis over the debt ceiling that threatened to destabilize US and world financial markets.

The move sets the stage for negotiations over the next several months between the two big-business parties over deep cuts in social programs.

The White House endorsed the postponement of the debt ceiling, issuing a conciliatory statement Tuesday, the day before the vote, with White House press secretary Jay Carney saying that if the bill “reaches the president’s desk he would not stand in the way of the bill becoming law.”

Senate Majority Leader Harry Reid hailed the House action, declaring, “I’m very glad that they are going to send us a clean debt-ceiling bill.” Democratic Senator Patty Murray of Washington state, chair of the Senate Budget Committee, immediately embraced the requirement in the House bill that the Senate pass a budget by April 15.

As the price of voting for this extension, more Republicans demanded an intensification of the assault on essential social benefit programs like Social Security, Medicare and Medicaid. This is comprised of at least three separate initiatives:

• The House will adopt a budget resolution, drafted by Budget Committee chairman Paul Ryan, aimed at reducing the annual federal deficit to zero over the next ten years. While Ryan gave no details, the cuts required would go far beyond his two previous proposals, in 2011 and 2012, which included transforming Medicare into a voucher program and effectively eliminating Medicaid.

• Congressional Republicans will enter the next round of fiscal negotiations on the so-called sequester, spending cuts that take effect March 1, with the demand that the full $110 billion in across-the-board cuts take effect. Any rescinding of scheduled cuts, for example in military spending, as demanded by many congressional Democrats and Republicans, would require equivalent offsetting cuts somewhere else.

• The debt ceiling extension is tied to a requirement that the Democratic-controlled Senate adopt a budget resolution of its own by April 15. Murray’s support means that Senate Democrats will go on record with their own proposal for cuts in entitlement programs for the first time since Obama entered the White House in 2009.

These maneuvers set the stage for a new and greatly accelerated attack on the social programs on which tens of millions of working, disabled and elderly Americans rely for their health coverage and basic income.

Pushing the debt ceiling back into May gives priority to the budget talks over the sequester cuts, set to take effect March 1, and to a measure that would authorize federal spending for the remainder of the 2013 fiscal year. The current authorization, known in Washington jargon as a “continuing resolution,” was adopted before the 2012 election and expires March 27. At that point, many federal operations would be shut down for lack of funding.

The Treasury hit the previous debt ceiling of $16.4 trillion on December 31 and has been engaged in stopgap measures to avoid further borrowing. Treasury Secretary Timothy Geithner had said that these efforts would be exhausted as early as mid-February, warning that federal payments, including March 1 Social Security checks, might be endangered.

The House bill does not raise the debt ceiling now, but rather suspends enforcement of it, a largely semantic distinction, since the measure automatically increases the debt ceiling May 19 to whatever level of borrowing has been reached by then.

The Treasury would presumably adopt a new set of stopgap measures after May 19, with some financial market commentators suggesting that the effect of the House bill is to defer any further debt ceiling crisis until late summer.

The vote for the temporary suspension of the debt ceiling was 285-144, with most Republicans supporting the bill (199 for and 33 against) while Democrats were split (86 for and 111 against). Most Democrats withheld their votes until all the Republicans had voted, in an effort to compel as many Republicans as possible to support the measure, which was opposed by Tea Party groups.

The House Republicans decided to push back the debt ceiling deadline largely because of pressure from corporate America, where there was concern that another debt ceiling crisis, like that which led to a downgrade in the US credit rating in August 2011, could have a shock effect on the US and world financial system. This is especially so under conditions of slowdown in China and other previously fast-growing economies in Asia and Latin America, and outright slump in Europe.

The Wall Street Journal voiced the consensus in financial circles with an editorial Wednesday endorsing the House Republican leadership’s decision to put off any direct clash over the debt ceiling, even though they dropped their insistence that any rise in the debt ceiling be matched, dollar for dollar, by spending cuts.

The editorial declared, “Mr. Boehner’s tactical retreat buys some time and puts more spending pressure on Democrats. The automatic sequester cuts that Congress agreed to in 2012 will arrive on March 1, causing an immediate cut of $69 billion in discretionary spending, to $974 billion.”

This argument reflects calculations that there was a better chance to reach a bipartisan budget-cutting deal with the Obama administration in talks over the sequester and the continuing resolution during the next two months.

Obama has repeatedly signaled his willingness to revive a tentative deal with House Speaker John Boehner, reached in July 2011, which called for substantial cuts in both Medicare and Social Security: raising the eligibility age for Medicare from 65 to 67, and cutting future cost-of-living increases for Social Security recipients by changing the formula by which they are calculated.

The Obama administration was quick to welcome the Republican move on the debt ceiling because, while it is concerned about the status of US treasuries, it is united with Republicans on its commitment to enforce unpopular cuts to key social programs.

Liberal commentators have hailed Obama’s Second Inaugural address as a renewed commitment to “modern liberalism.” What this means is the combination of empty demagogy and identity politics with a historic attack on the working class.

Millions Die in Africa After Big Pharma Blocks Imports of Generic AIDS Drugs

Goldman Sachs Made $400 Million Betting On Food Prices While Hundreds Of Millions Starved

Why does it seem like wherever there is human suffering, some giant bank is making money off of it?  According to a new report from the World Development Movement, Goldman Sachs made about 400 million dollars betting on food prices last year.  Overall, 2012 was quite a banner year for Goldman Sachs.  As I reported in a previous article, revenues for Goldman increased by about 30 percent in 2012 and the price of Goldman stock has risen by more than 40 percent over the past 12 months.  It is estimated that the average banker at Goldman brought in a pay and bonus package of approximately $396,500 for 2012.  So without a doubt, Goldman Sachs is swimming in money right now.  But what is the price for all of this "success"?  Many claim that the rampant speculation on food prices by the big banks has dramatically increased the global price of food and has caused the suffering of hundreds of millions of poor families around the planet to become much worse.  At this point, global food prices are more than twice as high as they were back in 2003.  Approximately 2 billion people on the planet spend at least half of their incomes on food, and close to a billion people regularly do not have enough food to eat.  Is it moral for Goldman Sachs and other big banks such as Barclays and Morgan Stanley to make hundreds of millions of dollars betting on the price of food if that is going to drive up global food prices and make it harder for poor families all over the world to feed themselves? This is another reason why the derivatives bubble is so bad for the world economy.  Goldman Sachs and other big banks are treating the global food supply as if it was some kind of a casino game.  This kind of reckless activity was greatly condemned by the World Development Movement report...

"Goldman Sachs is the global leader in a trade that is driving food prices up while nearly a billion people are hungry. The bank lobbied for the financial deregulation that made it possible to pour billions into the commodity derivative markets, created the necessary financial instruments, and is now raking in the profits. Speculation is fuelling volatility and food price spikes, hurting people who struggle to afford food across the world."
So shouldn't there be a law against this kind of a thing?

Well, in the United States there actually is, but the law has been blocked by the big Wall Street banks and their very highly paid lawyers.  The following is another excerpt from the report...

"The US has passed legislation to limit speculation, but the controls have not been implemented due to a legal challenge from Wall Street spearheaded by the International Swaps and Derivatives Association, of which Goldman Sachs is a leading member. Similar legislation is on the table at the EU, but the UK government has so far opposed effective controls. Goldman Sachs has lobbied against controls in both the US and the EU."
Posted below is a chart that shows what this kind of activity has done to commodity prices over the past couple of decades.  You will notice that commodity prices were fairly stable in the 1990s, but since the year 2000 they have been extremely volatile...

Commodity Prices

The reason for all of this volatility was explained in an excellent article by Frederick Kaufman...

The money tells the story. Since the bursting of the tech bubble in 2000, there has been a 50-fold increase in dollars invested in commodity index funds. To put the phenomenon in real terms: In 2003, the commodities futures market still totaled a sleepy $13 billion. But when the global financial crisis sent investors running scared in early 2008, and as dollars, pounds, and euros evaded investor confidence, commodities -- including food -- seemed like the last, best place for hedge, pension, and sovereign wealth funds to park their cash. "You had people who had no clue what commodities were all about suddenly buying commodities," an analyst from the United States Department of Agriculture told me. In the first 55 days of 2008, speculators poured $55 billion into commodity markets, and by July, $318 billion was roiling the markets. Food inflation has remained steady since.

The money flowed, and the bankers were ready with a sparkling new casino of food derivatives. Spearheaded by oil and gas prices (the dominant commodities of the index funds) the new investment products ignited the markets of all the other indexed commodities, which led to a problem familiar to those versed in the history of tulips, dot-coms, and cheap real estate: a food bubble. Hard red spring wheat, which usually trades in the $4 to $6 dollar range per 60-pound bushel, broke all previous records as the futures contract climbed into the teens and kept on going until it topped $25. And so, from 2005 to 2008, the worldwide price of food rose 80 percent --and has kept rising.
Are you angry yet?

You should be.

Poor families all over the planet are suffering so that Wall Street bankers can make bigger profits.

It's disgusting.

Many big financial institutions just seem to love to make money on the backs of the poor.  I have previously reported on how JP Morgan makes billions of dollars issuing food stamp cards in the United States.  When the number of Americans on food stamps goes up, so does the amount of money that JP Morgan makes.  You can read much more about all of this right here: "Making Money On Poverty: JP Morgan Makes Bigger Profits When The Number Of Americans On Food Stamps Goes Up".

Sadly, the global food supply is getting tighter with each passing day, and things are looking rather ominous for the years ahead.

According to the United Nations, global food reserves have reached their lowest level in nearly 40 years.  Global food reserves have not been this low since 1974, but the population of the world has greatly increased since then.  If 2013 is another year of drought and bad harvests, things could spiral out of control rather quickly...

World grain reserves are so dangerously low that severe weather in the United States or other food-exporting countries could trigger a major hunger crisis next year, the United Nations has warned.

Failing harvests in the US, Ukraine and other countries this year have eroded reserves to their lowest level since 1974. The US, which has experienced record heatwaves and droughts in 2012, now holds in reserve a historically low 6.5% of the maize that it expects to consume in the next year, says the UN.

"We've not been producing as much as we are consuming. That is why stocks are being run down. Supplies are now very tight across the world and reserves are at a very low level, leaving no room for unexpected events next year," said Abdolreza Abbassian, a senior economist with the UN Food and Agriculture Organisation (FAO).
The world has barely been able to feed itself for some time now.  In fact, we have consumed more food than we have produced for 6 of the last 11 years...

Evan Fraser, author of Empires of Food and a geography lecturer at Guelph University in Ontario, Canada, says: "For six of the last 11 years the world has consumed more food than it has grown. We do not have any buffer and are running down reserves. Our stocks are very low and if we have a dry winter and a poor rice harvest we could see a major food crisis across the board."

"Even if things do not boil over this year, by next summer we'll have used up this buffer and consumers in the poorer parts of the world will once again be exposed to the effects of anything that hurts production."
We desperately need a good growing season next summer, and all eyes are on the United States.  The U.S. exports more food than anyone else does, and last summer the United States experienced the worst drought that it had seen in about 50 years.  That drought left deep scars all over the country.  The following is from a recent Rolling Stone article...

In 2012, more than 9 million acres went up in flames in this country. Only dredging and some eleventh-hour rain kept the mighty Mississippi River from being shut down to navigation due to low water levels; continuing drought conditions make "long-term stabilization" of river levels unlikely in the near future. Several of the Great Lakes are soon expected to hit their lowest levels in history. In Nebraska last summer, a 100-mile stretch of the Platte River simply dried up. Drought led the USDA to declare federal disaster areas in 2,245 counties in 39 states last year, and the federal government will likely have to pay tens of billions for crop insurance and lost crops. As ranchers became increasingly desperate to feed their livestock, "hay rustling" and other agricultural crimes rose.
Ranchers were hit particularly hard.  Because they couldn't feed their herds, many ranchers slaughtered a tremendous number of animals.  As a result, the U.S. cattle herd is now sitting at a 60 year low.

What do you think that is going to do to meat prices over the next few years?

Meanwhile, the drought continues.  According to the U.S. Drought Monitor, this is one of the worst winter droughts the U.S. has ever seen.  At this point, more than 60 percent of the entire nation is currently experiencing drought.

If things don't turn around dramatically, 2013 could be an absolutely nightmarish year for crops in the United States.  If 2013 does turn out to be another bad year, food prices would soar both in the U.S. and on the global level.  The following is from a recent CNBC article...

The severe drought that swept through much of the U.S. last year is continuing into 2013, threatening to cripple economic growth while forcing consumers to pay higher food prices.

"The drought will have a significant impact on prices, especially beef, pork and chicken," said Ernie Gross, an economic professor at Creighton University and who studies farming issues.
So let us hope for the best, but let us also prepare for the worst.

It looks like higher food prices are on the way, and millions of poor families all over the planet will be hard-pressed to feed their families.

Meanwhile, Goldman Sachs will be laughing all the way to the bank.