fair trade

Blame famine on trade restrictions, not on climate change or a lack of Western aid.

Today is World Food Day and, once again, millions of people in East Africa are starving. Some have sought to turn this tragedy into opportunity. Ethiopia’s Prime Minister Meles Zenawi blames Western-induced climate change, and demands that rich countries cut greenhouse gas emissions and provide more aid. These views are echoed by the World Bank, Oxfam, Christian Aid and that bellwether of bad ideas, Gordon Brown. But such top-down solutions are doomed to failure. If Africans are to to weather their existing and future climates, the solutions must come from the bottom up.

Birhan Weldu became the poster child for famine in Africa 25 years ago. Then 3 years old, the image of the emaciated girl from the Ethiopian highlands appeared in newspapers across the world and was shown at a “Live Aid” event, viewed by over a billion people. A grown-up Ms. Weldu appeared at the “Live 8″ concert in 2005—as if demonstrating the success of the effort mounted by Sir Bob and his buddies.

Although thousands of individuals like Ms. Weldu have been saved by Western charity and taxes, millions more have suffered and died needlessly from famine in East Africa in the past quarter century. But their suffering was not caused by a lack of aid. Nor was it caused primarily by climate change (Western-induced or otherwise). Rather, it was and is the result of policies in the affected countries that inhibit freedom and incentives to trade, own land, and invest in diverse, prosperity-enhancing economic activities.

Before about 1800, famine was a common cause of death everywhere. The majority of the world’s population were subsistence farmers. When conditions were good, they produced enough to eat and a little more. When conditions were bad, they consumed their savings. If the bad conditions persisted, they died.

Then, first in England and soon in many other parts of the world, people began to rise above subsistence. They specialized more narrowly than before in the production of certain goods and they traded with others who also specialized. This led to increased output, as specialists were able to produce more than generalists. Competition in the supply of goods drove innovation, which led to further increases in output. Agricultural production rose dramatically and famine declined.

Two European famines of the nineteenth century stand out as exceptions: Ireland from 1845 to 1852, and Finland from 1866 to 1868. Both were the result of oppressive governments restricting the rights of individuals to own land and trade. In both countries, subsistence farming, combined with disease and bad weather, resulted in the death of many.

Since the 1920s, global deaths from drought-related famines have fallen by 99.9%. The reason? Continued specialization and trade, which has skyrocketed the amount of food produced per capita, and has enabled people in drought-prone regions to diversify and become less vulnerable.

In places where trade is restricted, people are forced to remain subsistence farmers. So, when drought occurs, the majority suffer and many die. The Indian drought of 1965 affected 100 million people, of which 1.5 million died. India subsequently liberalized and farmers adopted new technologies, notably high-yielding varieties of wheat and rice developed by Norman Borlaug, a truly deserving recipient of the Nobel Peace Prize. Although the droughts of 1987 and 2002 affected three times as many people, there were only 300 reported deaths in 1987 and none in 2002.

The 1983 to 1985 famine in Ethiopia, which Ms. Weldu survived, was a direct result of then-President Mengistu Haile Miriam’s policies, which combined socialism with a violent resettlement program. Unable to trade, people engaged in subsistence agriculture. When drought struck in 1983, as it does periodically, millions were unable to obtain enough food. Aid flowed in from foreign governments and from naïve Westerners (including me, since I bought a couple of copies of “Do They Know It’s Christmas?”), but much of it was requisitioned by the regime and used to oppress the very people it was supposed to help. Over a million died.

Mengistu continued to implement his socialist vision after the drought, forcing over 12 million people to live in essentially autarkic villages, promoting poverty and inhibiting adaptation. Ethiopia’s economy had been growing steadily until Mengistu came to power, with real per capita GDP rising by about 50% in the 20 years before 1973 (in spite of attempts by the government at planned agro-industrialization). But by the time he was eventually forced out of office in 1990, Ethiopia’s real per capita output was about 10% lower than in 1973.

Things did not change much during the 1990s, and GDP stagnated. Since coming to power in 1991, Mr. Zenawi has removed some trade restrictions and introduced a commodities exchange. As a result, the economy has grown rapidly. Yet state restrictions on ownership of land, and the government’s view that certain agricultural activities are essential, have undermined investment and prohibited the rural poor from fully participating in the economy. This means the recent drought has again hit the rural poor hardest, and left around 14 million people on the verge of starvation.

The pattern repeats across the continent. In the 1970s, Idi Amin murdered and exiled Uganda’s traders and nationalized many businesses. The country’s economy collapsed. When Yoweri Museveni came to power, he gradually liberalized the economy and it has since prospered. But in the northeast, government forces have clashed with the Lords Resistance Army and with so-called “warrior” pastoralists in Karamoja. Over two million people have been forced into subsistence farming, and are thus at the mercy of the variable climate.

Kenya’s economy has also grown rapidly for the past several years, as a result of economic liberalization. But large swathes remain subject to uncertain tenure rules, which make it more difficult to buy, sell or mortgage land, thus inhibiting agricultural improvement and diversification, and acting as barriers to trade. In such areas, tribal conflicts are more frequent, for in the absence of trade, warfare is the only way to improve one’s lot. Kenya’s land reforms of 2009 promise to exacerbate this situation by further undermining security of tenure.

The situation in Somalia is similar: Years of lawlessness and warfare have destroyed formal property rights and trade. As a consequence, about half of the population now faces the prospect of starvation.

Instead of carping about climate change and more aid, the World Bank, Western governments and all those charities in Africa should learn the lessons from one of this year’s economics Nobel laureates. Elinor Ostrom has spent a lifetime analyzing the ways in which humans devise institutions—from formal property rights to informal “rules of the game”—that let them solve their own problems. Her work emphasizes the need for such institutions to be built from the bottom up, without interference from higher levels of government.

Unfortunately, the West still incentivizes the political elite in Africa to impose rules from the top down, by providing “aid” that lets them ignore their citizens. Let’s stop “aiding” these kleptocrats with our taxes. Those leaders who genuinely want to govern will have to stop interfering, so their people can own property and trade.

By – JULIAN MORRIS