Worry About Bread Not Oil

The great demographer and economist Thomas Malthus was 23-years-old the last time a British summer was this rain-soaked, which was back in 1789. The consequences of excessive rainfall in the late 18th century were predictable.

Crops would fail, the harvest would be dismal, food prices would rise and some people would starve. It was no coincidence that the French Revolution broke out the same year.

The price of a loaf of bread rose by 88 per cent in 1789 as a consequence of similar lousy weather. Historians of the Left like Georges Lefebvre used to see this as a prime cause of Louis XVI's downfall.

Nine years after that rain-soaked summer, Malthus published his Essay on the Principle of Population. It is an essay we would do well to re-read today.

Malthus's key insight was simple but devastating. "Population, when unchecked, increases in a geometrical ratio," he observed. But "subsistence increases only in an arithmetical ratio."

In other words, humanity can increase like the number sequence 1, 2, 4, 8, 16, whereas our food supply can increase no faster than the number sequence 1, 2, 3, 4, 5. We are, quite simply, much better at reproducing ourselves than feeding ourselves.

Malthus concluded from this inexorable divergence between population and food supply that there must be "a strong and constantly operating check on population".

This would take two forms: "misery" (famines and epidemics) and "vice", by which he meant not only alcohol abuse but also contraception and abortion (he was, after all, an ordained Anglican minister).

The vices of mankind are active and able ministers of depopulation, wrote Malthus in an especially doleful passage of the first edition of his Essay. "They are the precursors in the great army of destruction; and often finish the dreadful work themselves."

But should they fail in this war of extermination, sickly seasons, epidemics, pestilence, and plague advance in terrific array, and sweep off their thousands and tens of thousands. Should success be still incomplete, gigantic inevitable famine stalks in the rear, and with one mighty blow levels the population with the food of the world.

I wish I could have a free lunch for every time I've heard someone declare: "Malthus was wrong." Superficially, it is true, mankind seems to have broken free of the Malthusian trap.

The world's population has increased by a factor of more than six since Malthus's time, passing the 6 billion mark not so long ago. Average life expectancy has risen worldwide from 28 to 67.

Yet the daily supply of calories for human consumption has also gone up on a per capita basis, exceeding 2,700 in the Nineties. In France, on the eve of the Revolution, it was just 1,848. Since Malthus's day, the average human being's income has increased by a factor of more than eight.

Human beings have grown taller and bigger, too. The average British male stood 5ft 5in tall in the late 18th century. Today, his mean height is 5ft 9in. So abundant is food in the land of the free that more than a fifth of Americans are now classified as obese.

The conventional explanation for our seeming escape from Malthus is the succession of revolutions in global agriculture, culminating in the post-war "Green Revolution" and the current wave of genetically modified crops.

Since the Fifties, the area of the world under cultivation has increased by roughly 11 per cent, while yields per hectare have increased by 120 per cent. In 2004, world cereal production passed the 2 billion metric ton mark.

Yet these statistics don't disprove Malthus. As he said, food production could increase only at an arithmetical rate, and a chart of world cereal yields since 1960 shows just such a linear progression, from below one and a half metric tons to around three.

Meanwhile, vice and misery have been operating just as Malthus foresaw to prevent the human population from exploding geometrically.

On the one hand, contraception and abortion have been employed to reduce family sizes. On the other hand, wars, epidemics, disasters and famines have significantly increased mortality.

Together, vice and misery have ensured that the global population has grown at an arithmetic rather than a geometric rate. Indeed, they've managed to reduce the rate of population growth from 2.2 per cent per annum in the early Sixties to around 1.1 per cent today.

The real question is whether we could now be approaching a new era of misery. Even at an arithmetic rate, the United Nations expects the world's population to pass the 9 billion mark by 2050.

But can world food production keep pace? Plant physiologist Lloyd T Evans has estimated that "we must reach an average yield of four tons per hectare. to support a population of 8 billion". But yields right now are, as we have seen, just three tons per hectare. And a world of eight billion people may be less than 20 years away.

Meanwhile, man-made forces are conspiring to put a ceiling on food production. Global warming and the resulting climate change may well be increasing the incidence of extreme weather events as well as inflicting permanent damage on some farming regions.

It is not just British crops that are suffering this year. At the same time, our effort to slow global warming by switching from fossil fuels to bio-fuels is taking large tracts of land out of food production.

According to the OECD, American output of corn-based ethanol and European consumption of oilseeds for bio-fuels will double by 2016. Only the other day, the executive director of the World Food Programme expressed anxiety about the unintended consequences of this huge shift of resources.

Some people worry about peak oil. I worry more about peak grain.

The fact is that world per capita cereal production has already passed its peak, which was back in the mid-Eighties, not least because of collapsing production in the former Soviet Union and sub-Saharan Africa. Simultaneously, however, rising incomes in Asia are causing a surge in worldwide food demand.

Already the symptoms of the coming food shortage are detectable. The International Monetary Fund recorded a 23 per cent rise in world food prices during the last 18 months. Maybe you've observed it yourself. I certainly have.

Of course, we're not supposed to notice that prices are going up. In the United States, the monetary authorities insist that we should focus on the "core" Consumer Price Index, which excludes the cost of food. According to that measure, the annual inflation rate in the US is just 2.2 per cent. But food inflation is roughly double that.

It's a similar story in Britain. Officially, UK inflation was running at 2.4 per cent in June. But food accounts for just 10.3 per cent of the notional basket of goods on which the CPI is based. Food inflation is actually 4.8 per cent.

And it gets worse. When I wanted a Philly cheese steak in the States last week, I had to pay through the nose. That's because cheese inflation is 4 per cent, steak inflation is 6 per cent and bread inflation is 10 per cent. (American steak is now 53 per cent dearer than it was 10 years ago.)

It was even worse when I fancied fish and chips for lunch on my return to Britain. That's because the fish inflation rate is currently 11 per cent in the UK, closely followed by the potato inflation rate of 10 per cent.

The great question now at issue, Malthus asked more than 200 years ago, "is whether man shall henceforth start forwards with accelerated velocity towards illimitable, and hitherto unconceived improvement, or be condemned to a perpetual oscillation between happiness and misery."

For a long time we have deluded ourselves that "illimitable improvement" was attainable. As the world approaches a new era of dearth, expect misery - and its old companion vice - to make a mighty Malthusian comeback.