The politics of food.

Seems that the central government has still not moved around 4 million tonnes of grain from Haryana that it has procured between 2009 and 2011. TOI, 3 December. According to documents with the Department of Food and Supplies over 6 million, which is a massive 65%, out of a total of 9.5 million tonnes of grain, are being stored out in the open which means that one heavy rain shower and most of it will rot. Vijay Setia of the Rice Exporters' Association, Haryana said," Storage plays a key role as far as nutritional value of grain, especially rice, is concerned. Poor storage has resulted in downgrading of quality of rice by countries which buy rice from India." This means that when ministers say that 10-12% food inflation is being caused by supply side problems they are lying. The price of food is being pushed up by the Minimum Support Price, which is higher than the market price, that the government pays to farmers irrespective of the quantity being produced, by the NREGA scheme, which has pushed up wages of rural labor, and by hoarding by the government, which would be considered highly illegal if practiced by private merchants. What is impossible to understand is why the government is hoarding so much food when lowering inflation by selling most of it would earn votes or exporting a large fraction would earn billions of dollars and ease the Current Account Deficit. It maybe that the Congress calculates that the price of food will not affect the poor who can be supplied through the Public Distribution System, also called ration shops. The middle class would suffer but then the Congress sees the middle class as its enemy. A lot of the middle class people do not vote and a large percentage of those that do vote for the BJP. Middle class people see politicians as universally corrupt and the Congress as a cross between the mafia, only interested in looting the people, and the KGB, unleashing its dogs of the CBI on anyone daring to criticise. It was the massive middle class support for Anna Hazare that resulted in politicians reluctantly taking up the Lok Pal bill and Manu Sharma, son of a Congress fellow and murderer of Jessica Lal, being sent to prison for life. Not good at all. The Congress is probably banking on a quick passage of the Food Security Bill, which guarantees free food to the poor amounting to some 70% of the population, because no party will dare oppose it for fear of losing votes. Once the bill is passed the Congress can rush extra food through the PDS and take all the credit. Trouble is that the PDS is a broken system and a vast quantity will be diverted to the open market. A lot of grains will rot and become unfit for humans. As long as the naked aam aadmi is properly grateful the Congress is happy. It cannot lose. Only problem is that doling out borrowed money ultimately leads to bankruptcy. Question is how long it will take.