I Told You So
Last Saturday, Hans wrote a blog post about unrest in Egypt sparked by inflation in the price of food, which, in turn, is caused by ethanol production quotas enacted by rich country governments.
Now, for the tooting of my own horn: I predicted ethanol unrest in Egypt last September, in a piece I wrote for National Review Online’s “Energy Week.”
So now that I’ve built up credibility as a seer, here’s another prediction: America will suffer a major drought sometime in the next three years that will cause the price of a bushel of corn on the international market to pass $10 (now, it’s at an all time high of $6).
In China, the price of pork, a politically sensitive commodity, will skyrocket, because pigs are fed corn. The Communist government will step in and try to ration swine. That will create a robust black market in “the other white meat,” which will allow the rich will buy up all the pork. The poor will be reminded of China’s gross inequality and they will start to riot.
From there, it’s anyone’s guess. Maybe the Communist government will crush the rioters and the issue will go away. But perhaps not. Perhaps, the rioting will spread, and disrupt the Chinese economy. That would have implications for global markets, and, ultimately, the pocketbooks of everyday Americans.