Prices are up due to short supplies due to biofuels and weather.
And the political response is handing out funds to those in need, even though that doesn’t create more to eat.
As previously discussed, governments have no choice but to step on the inflation pedal.
Whether it be for food support payments or financial sector support.
That’s how ‘democracy’ works.
(And democracy is way better than the second choice!)
World Bank’s Zoellick: Food prices high until 2012
by Alexandra Hudson
World Bank President Robert Zoellick said on Saturday he expected food prices to remain above 2004 levels until at least 2012 and energy prices would also remain high and volatile.
He repeated that with food and fuel prices in a “danger zone” there was a need for $10 billion to provide food and cash handouts for the world’s poorest.
Soaring oil and food prices have fueled inflation across the globe at the same time as economies slow, posing a sharp dilemma for lawmakers.