Food -- The American Midwest at the Cusp of an Economic Renaissance

11/07/2010 05:02 pm ET | Updated May 25, 2011
  • Raymond J. Learsy Author, 'Ruminations on the Distortion of Oil Prices and Crony Capitalism'

"The Midwest has lost a manufacturing empire but has not yet found another role." Words that were written by the New York Times' incisive Op-ed page contributor David Brooks in Friday's Op-ed "Midwest at Dusk." He cites the vast American expanse from central New York and Pennsylvania out through Ohio, Indiana spreading to include Wisconsin and Arkansas.

Here, Brooks proffers, is the place where the trajectory of American politics is being determined. "If America can figure out how to build a decent future for the working-class people in this region, then the U.S. will remain a predominant power. If it can't, it won't."

And yet, here, as hardly elsewhere in this nation, something is stirring that has the potential of becoming a game changer, a uniquely American game changer. This summer past an event took place that has begun to alter the equilibrium of economic trends and influence. In July the Russian government, responding to a disastrous drought, embargoed the export of wheat -- unilaterally breaking sales commitments to national buyers throughout the world. The price of wheat and other grains such as corn, soybeans etc. exploded as reserve stocks of grain were being drawn down worldwide.

Yet, the underlying thrust of what took place has been barely touched upon. The world, with its steeply growing population and rapidly changing dietary habits (especially in the emerging economies) is on the precipice of food shortage. If not immediately, it will be very soon. It is generally understood that with expanding populations world calorie production will have to double by 2050, but no one quite knows how to achieve this given that the major impact of the "green revolution" (intense application of fertilizers, herbicides and improved seeds) has already reached dangerously diminishing returns.

In this coming crisis, America -- and the American Midwest -- will play a crucial and salutary role. It will become the most crucial provider of food grains to the world, building on an already primary, but barely heralded position of leadership.

The United States is now the largest grower and exporter of corn, vital as feed to the food chain, the largest exporter of wheat, and after Brazil the second largest exporter of soybeans. And as supplies of foodstuffs get tighter this position of preeminence will become more and more significant.

Now is the moment for a government with vision to lay the groundwork and prepare the breadbasket of America to renew itself and prepare for the destiny that will be thrust upon it. Instead of more overbuilt highways, now is the moment to improve the infrastructure servicing this sector such as refurbishing and extending our inland waterways system over which most of our grain is transported, improving port facilities and refurbishing and adding to our grain storage capabilities both inland and at ports of export loading. Further, that we now initiate a policy of extending to farmers and the agribusiness the kind of government financial support we stood ready to give to Wall Street, the finance industry, and the automobile industry, so that the ground work can be prepared to meet the demand that is verging on the horizon.

The Midwest is blessed with vast expanse of fertile land and great human talent as nowhere else in the world, coupled with an extensive inland waterway system permitting crop production to reach world markets. With proper policies in place going well beyond the current US Department of Agriculture assistance programs, now is the moment to extend to our agricultural sector the means to ready itself for the responsibilities and opportunities to come.

The Midwest has the potential of becoming in importance, the Saudi Arabia of food -- a commodity that will clearly surpass oil in economic, social and political significance. If proper policies are initiated now our Midwest will become the most important real estate in the world. And it will be an economic sector that cannot be outsourced!