Basic HTML Version
a.
The petroleum crisis then could
lead to other crises in the developing
countries - food specifically?
SEWELL:
Assuming that oil prices
stay at their current high level,
which I think
is
a good assumption,
something is going to have to be
done on a rather massive scale, par–
ticularly for the poorest countries -
India, Pakistan, Bangladesh and the
25 United Nations-designated least
developed countries. They need se–
rious help to get over this tremen–
dous bind they're going to be facing,
both because of need to ímport en–
ergy and food over the next severa!
years.. One way or another, some–
thing's going to have to be done so
that people literally will not starve,
and the whole system doesn't collapse.
a.
What about the future of the
Green Revolution - with its high
yield varieties so dependent upon
f ertili ze rs, he rb icides a nd in–
secticides?
HOWE:
The Green Revolution has
been placed in jeopardy by the rise
in oil prices. The rise in the cost of
fertilizer has gone up remarkably.
Urea, for example, has gone up per
metric ton from $70 or $80 about a
year ago to $240. So there has been
approximately a trebling in tbe cost
of fertilizer. And that'll have a po–
tentially very harmful elfect on the
Green Revolution.
The food problem was upon us
long before the increase in oil prices.
So it wasn't caused by oil price in–
creases. Oil is merely another dí–
mension to it. We calculate that if
you take this group of 30 or 40
countries referred to earlier and try
to figure out the adverse impact oo
them, in 1974, we're talking about a
$2 to $4 billion problem. That's the
size of the annual rescue operation
that will be needed for that group of
countr ies.
Tbat, of course, just pays the in–
creased cost. l f you want to reduce
that annual bi ll by increasing their
production of food and fertilizer
and developing thei r own altema–
tives to oil imports (India's coal re–
sources, for example), that will take
additional capital from the outside.
PLAIN TRUTH April 1974
Other developing countries are
also adversely affected, but they
could probably squeak through this
year. But if the problem drags on
for a long time without offsetting
factors, the ones that will be ad–
versely hit will become more nu–
merous. The
size
of the rescue
operation bill in '75-'76 could go up
if the rich nations start fighting
among themselves and fall into an
economic warfare that leads toa big
recession.
a.
It
doesn't look., then, as though
the rich nations of the world - the
United States, Canada, Western Eu–
rope, Japan - will be able to escape
the consequences of a mounting
crisis in the Third World?
SEWELL:
Americans cannot live
very long in a world which is in–
creasingly poverty-struck, tension–
ridden and disaster-prone. One
could easily predict a real and world
disaster situation in the least devel–
oped countries if things aren't done
in the near fu ture to alleviate it.
a.
Is there any chance of a roll–
back
in
the price .of petroleum and
petroleum products - especially for
the benefit of the developing coun–
tries?
HOWE:
J
have no special insights,
except what I read that carne out of
Rome - that the United States has
mounted a fairly vigorous diplo–
matic effort to roll the prices back.
And 1 don't know where I'd put my
money at this point.
a.
What effect would a recession
have on political developments?
HOWE:
India is already having
widespread strikes and political in–
stability. This would certainly add
to it. If the game played itself out in
the cruelest terms so that you got
into a major famine - starvation of
the kind that you had in the early
'40s when bodies were carted off by
the thousands every morning in In–
dia - why, 1 could see a demand
rising for an authoritarian govern–
ment. 1 would think the prospects
for continuing the very hopeful In–
dian experiment in democracy un–
der those circumstances would be
materially reduced.
o
". . . it wi/1 just about
wipe out the effect
of total development
assistance in the
world."
"The size of the
rescue operation bi/1
in '75- '76 could go
up if the rich nations
start fighting among
themselves and fa//
into an economic
warfare that leads to
a big recession."
"Sorne way or
another, something's
going to have to
be done so that
people literal/y wi/1
not starve and the
.whole system
doesn't collapse. "
13