Mr. Strauss-Kahn said he had heard from many financial officials this weekend that the West’s focus on fuel, at the expense of food, was a "crime against humanity." Though he noted that the I.M.F. is primarily a monetary and financial agency, he said it would try to "review its tools" to help countries pay for food imports.
I'm in the middle of a longer essay inspired, in part, by George Soros' new book, The New Paradigm for Financial Markets: The Credit Crisis of 2008 and what it means. Here's a few thoughts while I wait for my muse to finish singing that score.
The financial powers that be have noticed a disturbance in the force that binds society together- rapidly rising food prices.
According to the NYTimes: Dominique Strauss-Kahn, the managing director of the International Monetary Fund, said the food crisis posed questions about the survivability of democracy and political regimes.
"As we know in the past, sometimes those questions lead to war," he said. "We now need to devote 100 percent of our time to these questions."
There was a time in the not-so-distant past when financiers financed entrepreneurs. Now, in part as a result of Greenspan's et alios deification of that economic sector, financiers are often considered entrepreneurs. Thus, it seems to me, financiers feel justified in financing themselves- as if such will alleviate the problems of the world.
As I've argued in the past, finance, or intermediation, if you prefer, has proven to be a powerful catalyst which can accelerate material goods production. But it is not a thing unto itself. Its utility should not be measured in the $s it creates, as we do now with GDP, but in the increased flow of goods.
Put another way, while a nation of farmers might want for many of the niceties of life, they will at least have food- a nation of financiers will soon go hungry.
Thus I find Mr. Strauss-Kahn's comment above about reviewing its tools a bit funny. Unless those tools include planting, irrigation, distribution and harvesting equipment, the IMF may well prove impotent to the task.
When you're hungry, you don't go to the bank. You go to a farm.