Distress signals

One does not have to believe that market forces should rule every aspect of our lives or that democracy always makes for good government to realise that two current crises owe much to their absence. I refer both to the flood tragedy in Myanmar and the food price rises which threaten to cause widespread poverty and malnourishment.

The Nobel-Prize-winning Indian economist Amartya Sen once pointed out that famines do not occur in democracies. Modern communications enable news of shortages to be known and markets will provide supply, albeit at a cost.

Hundreds of thousands died during the Great Leap Forward because information was controlled and markets were nonexistent. In Myanmar, thousands died because a government terrified of information lacked both the will and some of the means to warn its citizens of the approaching peril. Storm surges driven by cyclones are nothing new to the Bay of Bengal. Bangladesh has suffered several such tragedies but now has warning systems to reach the most vulnerable people living on its low-lying river deltas, and safe areas for evacuation. Myanmar, a nation much better endowed with natural resources, has almost no such systems.

Myanmar, as a whole, cannot be short of rice. Despite abysmal productivity, it still has a small export surplus. But, after years of socialism, it has no market mechanisms which can get food to the areas where stocks have been destroyed by the flood. It must rely on an incompetent government and such foreign relief as is permitted.

In Myanmar, as in North Korea, the security of the state overrides the welfare of the people, so aid is received reluctantly and foreign personnel are kept out in case they allow information to come in.

It is a striking contrast to Indonesia when hardest hit by the tsunami. Foreign and local combined efforts ensured that few died of starvation or disease after the initial disaster.

Myanmar's government is also part of the larger current problem - rice shortages. If markets were allowed to operate freely, where farmers make their own decisions, Myanmar would still be the largest rice exporter in the world. But, instead of exporting 10 million tonnes like Thailand, or 4 million like Vietnam (once it liberalised its markets), it sells less than 1 million tonnes a year.