Nov 30, 2009
I hope you had a happy Thanksgiving. I know these aren’t the best of times here in the good ole USA, but everything is relative and compared to many other places in the world – I guess I’ll stay right here.
My message today is that we are in a world economy, and we can not escape that fact.
The Washington Post today has a big picture on the front page in color. Farm workers in Ethiopia are moving a big pile of golden corn. It makes me think of our farm and the corn that we are still trying to harvest. The story behind the picture is that India is buying and leasing huge tracts of land in Ethiopia. It is cheap, fertile, with water to irrigate. Saudi Arabia is shifting wheat production to Africa.
The Bill Gates Foundation is focusing attention on Arica to increase food production. There are millions of hungry people in the world. I have been in Brazil on a huge farm operated by a Midwest U.S. farmer.
The global marketplace is calling out to investors looking to profit by exploiting new opportunities. We already import billions of dollars worth of product from China. Try buying clothes for Christmas made in the U.S. – good luck.
If other countries have fertile land, cheap labor, raw materials, global investors will find it.
A final note – we can’t sit back and ignore the expansive increase in trade agreements from Asia, to Europe, to the Middle East. We will be left in the dust.
My purpose here today is not to alarm you, but we must be realistic. Ignoring reality can be costly. If we over-regulate our livestock industry, our pigs and chickens will be raised in another country. If we over-tax our energy, other countries will take our business away from us. The developing nations want to live the “good life” as we do. Don’t think for one minute that they will be willing to put their industry in a cap and trade straightjacket.
The world becomes more integrated every year. We need to be mindful of this fact when our government sets policy.
Until next week, I am John Block from Washington, D.C.