Thursday, May 01, 2008

Help from the smarties please?

I'm curious and I don't understand...

Review this graph at the Washington Post about imports and exports of grain around the world.

Why is it...why do countries export products that they are running short on?

Take for example South Asia (which appears to be India on the graph).

They are importing 7.9 metric tons of grain. YET...they are importing 7.5 metric tons of grain. Wouldn't it just make more sense to import the difference of .4 metric tons?

I'm sure that maybe they are exporting wheat and importing rice, or something like that? But in a global economic climate like we're in now, wouldn't it make more sense to balance it out a little more...keep it "local."

Or are the exports bringing in so much extra money that the countries can't afford not to export and it's just better for their economy to import the cheap stuff?

And then you look at North America...obviously there are surpluses there. Good. And we should be exporting to countries that have the stronger need...but again, let's say we keep what we need...then we don't need to import.

I guess by my logic I wouldn't have my tasty jasmine rice or other tasty goodies in my pantry...

I wasn't an economics major for a reason...


Jack said...

And the Middle East desperately needs grains, wasn't the deal at one time a bushel of wheat for a barrel of oil? We need to get deals like that back.

Stef said...

I'm so not an expert at this, but I'm guessing some of this might ??? be related to the idea that not all grain is used for food, too. Countries may be growing corn for ethanol and need to import other food. Which of course makes NO SENSE. I really don't understand the many ways we've made a mess of the world.

Now, i need someone to explain to me the argument *against* a gas tax holiday. Why would any regular consumers be against it??

Jack said...

Gas Tax repeal:
Simply put, the tax shortfall will have to be paid back again by us, along with the rest of the national debt either in higher taxes elsewhere or by decreases in services provided by the government.
The savings of $0.18 a gallon is minimal and will undoubtedly be succumbed to the ever rising gas price.
The only true benefit from the gas tax repeal is that it may convince some people to travel more and buy more gas. While the travel part may help tourist industries, the only real party to benefit will be the big oil companies who will see even larger profits.
Gas prices are not going up due to shortages, but due to speculations that their may be shortages and on speculations of how much we as consumers are willing to pay.
The truth is: if we want gas prices to drop, we need to stop buying gas.

Scott said...

Actually, the article says that the amount of grain traded on the global market is only a small percentage of the total produced because countries keep most of their crops for their own needs.

The differences are very likely due to crop specialization in the different areas -- most of the rice that you get in the store comes from California, but there is a demand for imports as well.