"Doug Casey on Food Riots and 'Inflation Lockdowns'"
by International Man
"International Man: Recently, we've seen people riot over rising prices—especially food prices—in Sri Lanka, Peru, and other countries. What is going on here?
Doug Casey: Commodity prices have generally gone up close to 100% in the last year. Soybeans ($17), wheat ($11), and corn ($8) are all at or near all-time highs - and they're not coming down. Why not? Mainly because of the trillions of currency units printed by central banks in the last year or so. Their prices are now at a new equilibrium level. But there are other reasons besides money printing.
Wheat, soybeans, and corn are basic for feeding people and animals around the world - certainly in the Western world. They've become much more expensive to produce. In today's era of industrial agriculture, fertilizer is of critical importance. All of the main fertilizers - nitrogen, phosphorus, and potassium compounds - have tripled or more.
It's unlikely that they're going to come down anytime soon because Russia and the Ukraine are two of the world's largest fertilizer producers. Even if the Ukraine war ends soon, there will still be import/export restrictions on Russia. Availability from Ukraine will be limited because of war-related difficulties producing and shipping fertilizer abroad - on top of the fact actual grain production has collapsed. The world seems to have forgotten that from the 20s to the 80s, there was consistent and widespread hunger in Ukraine and Russia. Since then, they've transformed into two of the world's biggest exporters - but that can change overnight.
And it's not just fertilizer, planting, and transport. Fuel is critical for running tractors and processing everything. Oil is over $100 a barrel right now - also about double recent levels. I think it's going to stay there and probably go higher because of the Green mania gripping the world. Large oil companies like Shell and BP, run by PC suits, intend to get out of the oil business. Their boards have been infiltrated with ESG types, and their hiring practices bow to diversity and inclusion. We're looking at a situation where actual oil production is headed down at the same time that costs have gone up.
When the price of food and fuel go up radically, the planet's poor are disproportionately affected. They're going to riot. They don't know who's at fault. But since they've been taught their governments are cornucopias, they'll blame the rich.
We'll soon see financial chaos, which will lead to economic chaos, political chaos, and social chaos. What we're hearing about in Sri Lanka and Peru is just the beginning. The US won't be immune. Americans who drive everywhere in giant SUVs and pickups will also feel the pinch, especially with their food bills up 30%.
International Man: How has the response to the ongoing Covid hysteria affected the situation?
Doug Casey: I've said many times in the past that COVID should have been considered as no more than a bad flu season. People forget that the annual seasonal flu typically kills 30,000-50,000 Americans. The media, the "health" establishment, and governments turned COVID into a hysteria, verging on mass psychosis. The facts are that no one other than the obese, the sick, and the elderly were in any real danger. Those people should have used precautions. Instead, the whole world was locked down like a prison.
The hysteria surrounding COVID shut down a good part of the world's production, made transportation nationally and internationally much slower and more expensive - the cost of shipping a container from China to the West Coast went from $3000 to $25,000. The public was encouraged to run around as if their hair was on fire. It wasn't COVID itself but the insanity surrounding it that greatly compounded the situation.
What I'm afraid of is that there's going to be a COVID 2.0, and then COVID 3.0, and then something else. That augurs poorly for price stability and social stability in the future. Before it's over, I don't doubt that the hoi polloi will clamor for a "Great Reset" like that the World Economic Forum is promising them.
International Man: The food riots seem to be occurring in Third World countries. Could they spread to North America and Europe? What do you think that would look like?
Doug Casey: Yes, they could. In the case of Americans, it's said that half of the country has no savings at all. Instead, they have loads of mortgage, credit card, auto, and student loan debt. So, if they need to lay their hands on even an extra $500 or $1,000, half of the people in the country couldn't do it.
Americans are basically living paycheck to paycheck, and worse than that, they're maintaining their standard of living with second mortgages and their credit cards. With interest rates headed up from today's all-time lows, they're going to be squeezed. The low-interest rates of the last decade have disguised the fall in the standard of living by making it possible to borrow more.
The same people who can't buy a car without seven-year financing or afford the $6 gas it takes to run it are generally the ones who don't own but rent a place to live. Rents have gone up 30% in the last year or two as well. It's not just Third Worlders - our natives are going to get restless too.
International Man: Thanks to the Covid madness, governments have normalized the use of lockdowns. It's a new tool in their toolbox. For example, there have been whispers about governments implementing lockdowns to address so-called climate change. Could we see governments impose "inflation lockdowns" as prices soar?
Doug Casey: It's critical to remember that the prime directive of all living things, whether we're talking about an amoeba, an individual, a corporation, or a government, is to survive. That's rule number one.
Let's look at governments, which actually produce nothing and serve little useful purpose. Their main gifts to humanity are wars, pogroms, persecutions, proscriptions, inflation, taxes, and regulations. It's as if the whole planet suffers from Stockholm Syndrome. I promise you governments will do whatever they think necessary to survive. Their citizens - subjects is a more honest word - are really just means to their ends. Governments believe they should manage their populations, viewing them as cattle in a feedlot. Of course, they'd prefer the cattle to be healthy and even happy. But that's not the prime directive. It's that the government itself survives.
A perfect example of this is what's going on in Shanghai now. It's actually unbelievable - but true - that the Chinese government has a city of 25 million people locked in their apartments. They can't even leave to get food. Rotten vegetables are dispensed to them like prisoners or captive animals. Hundreds of thousands more have been placed in gruesome facilities, packed in like cattle if they're suspected of having COVID. In many cases, people's pets are being slaughtered. It's criminally insane.
But what's even more insane is that 25 million people are accepting this just because they're told to. Why don't the Shanghaiese grab meat cleavers, swarm out into the streets, and take care of business, pursuing the chain of command as far as it will go? The answer is that they know the CCP would send in the Red Army. I suppose it's understandable that they'd rather cringe on their knees like slaves because that offers at least a chance of survival, no matter how degraded. Americans would likely bow to their government the same way. So, yes, I think we're going to see lots more of that type of thing in the world.
International Man: What are the personal freedom implications of all this?
Doug Casey: I hate to use the hackneyed phrase "a perfect storm." For the rest of this decade, we're looking at a perfect storm because of all the things we've talked about so far. It's important to remember that Americans in 2020 elected the most economically, politically, and socially radical regime in all our history - by a long margin. Some say the election was stolen. I wouldn't doubt it. But Americans also elected and re-elected Obama - and the country has gone a lot further left since then.
The Bidenistas are going to be in office for at least the next three years. They'll do everything in their power to cement themselves in office. Every idea they have is intended to change the very character of the US. Their roots and basic philosophy are identical to those of the Jacobins in France in 1789 or the Bolsheviks in Russia in 1917. As a result, during this decade, the US is likely to have the most serious set of crises since the country's founding. Hold onto your hat."
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