A skeptical question about financial speculation and food prices

Tom Philpott at Mother Jones blames food price increases since 2007 on financial speculators.  He is quite harsh on the fools like me, who thought rising food prices reflected resource scarcity.

Here is my question in his comments section:

I don't understand how speculation could raise food prices for more than a few months. 

The financial speculators are placing bets on the futures market.  If they expect prices to go up in January, they will buy a contract today that guarantees them a certain amount of commodity in January.  When January comes around, they sell their paper commodities on the ordinary spot market.  If they are correct that prices rose, they make a profit, because their January sale is more than the price they originally paid. 

An essential feature of this game is that the speculators do not want to take possession of a ton of corn or soybeans.  For speculators, the game is not "buying and more buying," it is "buying and then selling."  The buying drives up prices, and the selling drives down prices.  Commodity futures are different from "dot com" stocks, which can be held for a long time.

Basically, I find it much more plausible -- as an economist and as an environmentalist -- to see rising food prices as a symptom of real resource scarcity.

But I'll keep an open mind.  Can somebody explain more clearly: beyond the first few months of a speculative boom, how can financial speculators keep driving the price higher and higher?

Mark Bittman asks if junk food is really cheaper

Mark Bittman's column this week in the New York Times argues that junk food is not really cheaper.  For a reader who is skeptical, Bittman's rhetorical method is to provide an array of examples, each of which has different advantages. 

In general, despite extensive government subsidies, hyperprocessed food remains more expensive than food cooked at home. You can serve a roasted chicken with vegetables along with a simple salad and milk for about $14, and feed four or even six people. If that’s too much money, substitute a meal of rice and canned beans with bacon, green peppers and onions; it’s easily enough for four people and costs about $9. (Omitting the bacon, using dried beans, which are also lower in sodium, or substituting carrots for the peppers reduces the price further, of course.) 

The column concludes with both a cultural agenda and policy prescription.  Do you like one, or the other, or neither, or both?

Harvard's new Healthy Eating Plate

The new Harvard Healthy Eating Plate ...

... clearly is a modified version of USDA's MyPlate,...

... just as the earlier Harvard "Healthy Eating Pyramid" ...

 ... clearly was based on USDA's first pyramid graphic.  Harvard's experts in nutritional epidemiology agree with USDA's graphic designers on many key points.

Still, the Harvard researchers do make some distinctions.

One difference is that Harvard's new plate graphic requires 2 times as many words to communicate its message [Update, same day: edited the number of words to count USDA's accompanying text].  This may be helpful in dietary guidance targeting audiences with strong reading skills.

A second difference is that Harvard's new graphic substitutes water in place of dairy as the beverage placed outside of the plate.  The Harvard plate is more austere than the earlier Harvard pyramid, which was accompanied by a wine glass, and which also emphasized dairy.  The wine and the dairy are now gone from the new Harvard graphic.

A third difference is that the new Harvard graphic includes what looks like a very large amount of salad dressing oil, while recommending limits on red meat.

I see nutrition merit in the Harvard graphic, but wonder if it is more successful at emphasizing distinctions with USDA than at communicating dietary guidance to a general audience.

The bigger story behind the food-stamp-hating videos from Mr. EBT and Chapter

Obama Foodorama this week links to two rap videos showing Black people abusing their EBT cards from the Supplemental Nutrition Assistance Program (SNAP).

The videos exploit every possible racist stereotype for a laugh.  Some journalists are accepting them as straightforward satire, by artists who are themselves African American, but self-directed satire is not the whole story.

The conservative media is giving lots of attention.  The Drudge Report on Monday linked to the first video, by Mr. EBT, showing the singer buying junk food with an EBT card belonging to somebody else.  Fox News covers the same story.

The second video is far worse.  In it, the singer Latoya "Chapter" Hicks adopts the fanciful character of Keywanda, a foul-mouthed, sexaholic, beer-swigging, chain-smoking Black mother of 10 children.  She sings that "all you gotta do is f---" and 9 months later you get lots of government benefits.

Chapter's website, which hosts the video, and "Creative Indie Artists," which produced her song and video, are both projects of Christopher A. Jackson, a White man from California whose other job is as an executive for KROQUE, a military apparel contractor.  The Fact Evangelist found the link to the apparel contractor raised questions about the origin of this music project.

Digging a little further, I found an old MySpace page for Christopher Jackson. 

On the same MySpace page, there is a 2-year-old comment from Chapter, the singer in the video, introducing herself:

HELLO NEW FRIEND,

PLEASE CHECK OUT MY NEW SONGS I WROTE- PAY ME MY MONEY, LEFT OUT , CUTIE GOT BOOTIE

I AM A POP AND R&B SONGWRITER
CHAPTER

I wrote Jackson, seeking further information about the collaboration with Chapter. He responded today:

Chapter and I wrote the lyrics and Chapter produced and arranged the song. She is releasing another video this Saturday 9/24 and will continue to release a new video each month.

When I asked if this was hard-hitting anti-welfare social commentary, Jackson described the video as "a hard-hitting anti welfare-abuse-program pro social lesson."

An Ohio blog discusses whether the Chapter video is racist. This whole episode reminds me of the tiff in May, when Newt Gingrich called Obama the "food stamp president" and then successfully parried accusations that he was tooting a racist dog whistle.  The episode also brought to mind something very strange that I had noticed in the readership logs for this blog.  One of the highest-traffic posts in my archives is an old post about race and food stamps.  It turns out that hundreds of people on the internet are Googling the topic "race and food stamps."  Try it yourself and you can find truly depraved and racist discussion lists.

I hope Obama Foodorama and others who link to these videos will explore them a little further than they have so far.  Because these videos purport to be satire, I know I run the risk of seeming humorless.  But I'm not laughing yet. 

[Update, same day: deleted one intemperate sentence.]