The causes of rising food prices have been ascribed to ethanol production, rising standards of living in India and China and even evil speculators. It is true that ethanol production has contributed an estimated 20% to the rise of food prices. It is also true that rising standards of living have pushed up the price of food as more meat, which requires more grain, to be included in the diets of people in developing world. Speculation has also played a part, but the real reason is for the present rise in food and oil prices is poor government policy.

Most of the large grain exporting countries, Argentina, Russia, Ukraine and Kazakhstan and the rice exporting countries like Vietnam and Egypt have placed higher export tariffs or restrictions to lower local food prices and mollify restive populations. This has restricted supplies on international markets and raised prices everywhere. It also lessens economic incentives to local farmers in those countries to produce more. Worse, many countries have instituted price controls that just delays increases in prices.

Oil has been restricted by nationalizations of oil industries in Venezuela and Russia by inefficient and corrupt national corporations have lowered the amount of oil produced. Increases in national taxes and exploration restrictions have lowered the incentives for oil companies to produce and discover new sources.

Eventually both oil and food prices will come down as the world demand lessens as result of a global recession. However, the point is that the world has always been resource poor for any species including us. We should encourage markets to provide alternatives rather than provide subsidies or restrictions that discourage them.