Are Rising Oil and Food Prices a Scam?

Danny Schechter
Consortium News

Editor’s Note: International crises – from the earthquake/tsunami in Japan to the war in Libya – may be subjects for sympathy and concern among most people, but for financial speculators, they are opportunities to make money.

Yet, while investing in commodity futures also may have some broader economic value – by spreading risk – the question at a time of volatility is where does that purpose end and crass exploitation begin, as Danny Schechter asks in this guest essay:

The global economy and its recovery, and the living standards of millions of plain folks, are now at risk from the sudden rise in oil and commodity prices.

Gas at the pump is up, and going higher. Food prices are following. The consequences are catastrophic for the global poor as their costs go up while their income doesn’t.

It’s menacing American workers too, who in large part have not seen a meaningful raise since the days of Reagan (keeping it this way is clearly behind the current flurry of attacks on unions).

Already, unrest in the Middle East and many African countries is being blamed for these dramatic increases. It seems as if this threat to global stability is being largely ignored in our media, one that treats the oil business as just another mystical world of free market trading.

Why is it happening? Why all the volatility? Is oil getting scarcer, leading to price increases? Is the cost of food, similarly, a reflection of naturally increasing commodity prices?

While it’s true that natural disasters and droughts play some role in this unchecked price inflation, it also seems apparent that something else is attracting increasing attention, even if most of our media fails to explore what is a political time bomb while most political leaders shrug their shoulders and ignore it.

President Obama recently said there is nothing he can do about the hike in oil and food prices. But critics say the problem is that government and media alike refuse to recognize what’s really going on: unchecked speculation!

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