Energy Prices and Poverty

Submitted by OZ on Sun, 04/13/2008 - 08:52.

The relationship between the price of energy and the price of food may have devastating implications for the environment and the world’s poor in the foreseeable future. The price of food has become inextricably linked to the price of energy with the advent of plant-based fuels. Furthermore, as the price of energy rises ethanol becomes increasingly attractive. Adding insult-to-injury, consumers are willing to pay a premium for “green” labeling. Global food prices have sky rocketed in the past year in conjunction with rises in energy prices. Farmers are abandoning government conservation programs, whereby they are paid for not cultivating land. Deforestation will increase as and conservation will be strained in the face of high food prices. Ultimately, high food prices will create challenges for developing nations, increasing the likely hood of famine and hunger.

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