The Complicated Relationship Between Food and Money

By Frederick Kaufman
Published on October 26, 2012
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In “Bet the Farm,” a prominent food journalist follows the trail from Big Pizza to square tomatoes to exploding food prices to Wall Street, investigating why everyone can’t have healthy, delicious, and affordable food.
In “Bet the Farm,” a prominent food journalist follows the trail from Big Pizza to square tomatoes to exploding food prices to Wall Street, investigating why everyone can’t have healthy, delicious, and affordable food.
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Frederick Kaufman has written about American food culture and other subjects for the “New Yorker,” “Foreign Policy,” “Gourmet,” and the “New York Times Magazine.”
Frederick Kaufman has written about American food culture and other subjects for the “New Yorker,” “Foreign Policy,” “Gourmet,” and the “New York Times Magazine.”

Ever wonder what the path from “farm” to plate actually looks like? Bet the Farm(John Wiley &Sons, Inc., 2012) by food journalist Frederick Kaufman illustrates this shocking journey starting with a slice of pizza and ending at the commodities exchange where food gets its price. Along the way, Kaufman reveals all the forces at work from the profit motives of big business to the food politics that have broken the world food system. Be a fly on the wall at the World Economic Forum and read how the relationship between food and money skews the relationship between food and people in this excerpt taken from the Introduction, “Closed to the Press.”

Winter in the Swiss Alps, and the helicopters settle on landing pads patrolled by troops. Out the doors walk presidents, prime ministers, and the CEOs of companies like Google, ExxonMobil, and Bank of America. More than two thousand international leaders and luminaries have come to the World Economic Forum’s annual meeting in Davos, Switzerland, where they will weigh the prospects of the planet and everyone on it–and not necessarily tell us their conclusions.

Journalists trail the global chieftains, but Davos is not the easiest spot for them to ply their trade. Most of the lectures and debates are closed to the press, and all are held under the Chatham House Rule of confidentiality: “Participants are free to use the information received, but neither the identity nor the affiliation of the speaker, nor that of any other participant, may be revealed.”

In January 2012, Professor Yaneer Bar-Yam, president of the New England Complex Systems Institute in Cambridge, Massachusetts, came here to speak. The topic of his presentation was not typical for the World Economic Forum–not global capital and risk, not the future of democracy and development. But the seminar room was packed. Yaneer Bar-Yam was going to talk about food. Everyone who lives eats, so the moguls and the magnates scrutinized the models and graphs Bar-Yam projected on the screen. They sat in silence as the professor proved what everyone in the room already knew. Something had gone wrong with food, and the problem went beyond E. coli or high-fat, high-sugar diets. The problem went beyond artificial ingredients, pesticides, and fast-food restaurants.

The trouble with food, explained Bar-Yam, had first become apparent four years earlier, in 2008. That year, farmers produced more grain than ever, enough to feed twice as many people as were on Earth. In the same year, for the first time in history, a billion people went hungry. The paradox bordered on the pathological.

What had gone wrong with food? The Davos participants believed they understood the issues, and in this regard we have a lot in common with them. Modern food consciousness has been rooted in the writings of Wendell Berry, Frances Moore Lappé, Marion Nestle, Raj Patel, Michael Pollan, and Eric Schlosser, to name but a few. The activist agenda has been set: slow versus fast, small versus big, nutritional versus chemical, organic versus conventional, diversity versus monoculture, sustainable versus wasteful, farm-to-fork versus transnational, and local versus food from nowhere.

But along with our consciousness of the food problem have come a number of assumptions. Some of these have to do with how the problem came to be, others have to do with how the problem affects us, and still others have to do with the solution and how to fight back. Most of that fighting back currently takes place at the cash register as we buy food outside the agro-industrial supply chain and try to eat local and organic food, mostly vegetables. As a general rule, we believe that what ails the system must be either corporate greed or people not knowing any better, so we look to the education system to teach children how to eat and to government regulations to alter the behavior of those who sell us food.

But just as we returned to an appreciation of real food, just as we came to value family farms and local produce, it was as though food had slipped out of our grasp. In 2008, the price of the world’s most basic foods doubled, then doubled again, and people like Bar-Yam began to suspect that the problem went further than what we had assumed. The problem went to the core of the global system, and the system was broken. If you eat the most delicious local, grass-fed filet mignon, grilled with a side of seasonable vegetables and organic herbs, all from your neighborhood green market, that meal has come to you because there was money in it. If your daughter eats a school lunch of low-quality factory-farmed chicken nuggets and a suspicious-looking, peel-open cup of heavily sugared applesauce, all for just $1.50, that meal has come to her because there was money in it.

Food and money go way back, but something had transformed the basic transaction of selling a farm good for more than it cost to plant and harvest. Something had changed the way food is bought and sold. The CEOs at Davos were talking about food because it had stopped acting like food. But how could something so basic turn into something it was not?

Food had been financialized, Bar-Yam explained to the packed room in Davos. Food had become an investment, equivalent to oil, gold, silver, or any other commodity, equity, or derivative. The higher the price, the better the investment. Of course, when food becomes finance, hundreds of millions of hungry people have to pay the price.

But financialized food can pose problems for the CEOs of Pepsi and Yum Brands, too. The food business needs food to make food. You can’t sell burgers, chicken wings, french fries, Cheerios, or Twinkies if you can’t purchase the ingredients, and when the price of fundamental ingredients goes up, profits go down. Today, as half of the world heads toward obesity and the other half toward starvation, it’s worth asking who, exactly, is making the money.

For the rising price of food affects the bottom line of some of the largest processors and retailers on Earth. And the heads of Coca-Cola, General Mills, Kraft, and Nestlé understood that in order to solve their problem they would need to know why the price had come undone. They would need to quantify every cause and every effect.

And that was what Professor Bar-Yam was doing at Davos. He had translated food into numbers, reduced it to data. And this the Davos crowd could comprehend. But as subtly as he could, Bar-Yam was also pointing fingers. He’d figured out who was at the bottom of this. His tale had a villain–or villains–and some of them were no doubt in attendance.

This excerpt has been reprinted with permission from Bet the Farm: How Food Stopped Being Food, by Frederick Kaufman, published by John Wiley & Sons, 2012.

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