Food Fights

It’s a historical truth that when food prices rise, conflict increases. So it’s no wonder that the spike in the cost of agricultural commodities in recent months has been a contributing factor to revolution in the Middle East. As the map below shows, people in relatively poor countries–including Egypt, Tunisia and others in the developing world–spend a much higher percentage of their incomes on food. But food inflation is affecting Americans too. In the U.S., the poor spend 16% of their income on groceries vs. the rich, who spend 11%. What’s more, if food inflation cuts into emerging-market growth, as many economists expect, U.S. companies that export to those markets will suffer–and so will the people who work for them.