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Global Food Crisis Hits Home As Retailers Begin To Ration Rice

rice.JPGAs an unexpected consequence of rising commodity prices and the international food crisis, two American retail giants — Costco and Sam’s Club (a subsidiary of Wal-Mart) — have set quantity restrictions on purchases of bulk rice. Sam’s Club, who is now limiting purchases to four, 20 pound bags of rice per visit, claims that “it is a precautionary measure, aimed primarily at our business customers, making sure we have enough for everyone.” They say it is simply a reaction to “recent supply and demand trends.”

A spokesman from Costco tells a similar story:

We don’t want to create a panic where we don’t think there is a panic, if we weren’t able to get any more rice or any more flour that would be a different story but we’re able to continue to replenish our supplies.

So if there’s no panic, and no shortage in supply, then why are these mega-chains limiting rice? Most likely because the restaurant industry, whose profits have tumbled dramatically in the last twelve months, is looking for new ways to cut costs and save on expenses — particularly in light of the painful new fuel surcharges added on by their suppliers for warehouse-to-store truck trips.

Restaurant owners are therefore doing things like cutting back on sauces and portions, charging for extra condiments, and changing their food suppliers — instead of buying staples from delivery services, they are schlepping to the wholesale stores themselves. Sam’s Club and Costco provide another alternative, as both are known to cater to “small businesses including independent restaurants, nursing homes and day care centers.”

The USA Rice Federation seems to agree:

It’s possible that small restaurants and bodega-type neighborhood stores may be purchasing rice in larger quantities than they do typically to avoid higher prices.

Soaring inflation, poor harvests, and worldwide food shortages are causing other countries, such as Vietnam and India, to place temporary bans on some rice exports. American rice farmers appear to be taking advantage, holding back inventories in hopes of locking in bigger profits as worries about shortages continue to drive future prices. The U.S. accounts for only about 1.5% to 2% of global rice production, but it is the world’s fourth-largest exporter, behind Thailand, Vietnam and India. U.S. rice exports are forecast to increase 20% this year.

George Will Leaves The Research Behind

Our guest blogger is Robin Chait, a Senior Education Policy Analyst at the Center for American Progress Action Fund.

will.JPGAccording to George Will, history tells us that when it comes to educational achievement, family is destiny. Yet recent evidence from excellent charter schools tells us otherwise.

In an op-ed in the Washington Post today, Will cites the late Sen. Daniel Patrick Moynihan and the 1966 Coleman report to say that family structure and poverty are the key determinants of educational outcomes, and that money and government programs can’t — and don’t — make a difference. He writes:

No reform can enable schools to cope with the 36.9 percent of all children and 69.9 percent of black children today born out of wedlock, which means, among many other things, a continually renewed cohort of unruly adolescent males.

Unfortunately, one of the ways that family structure and poverty do have a strong impact is they indicate that students will be educated at weaker schools with fewer resources. A large body of evidence demonstrates that poor students have more inexperienced teachers, a weaker curriculum, poorer school facilities, and less funding for education.

Yet when poor children receive an excellent education, it does make a difference. Will ignores the existence of schools like the KIPP and Achievement First charter schools, whose students have demonstrated that low-income kids can catch up and excel. Eighty percent of KIPP students are low-income, and 90 percent are African American or Latino, yet more than 90 percent of KIPP middle school students have enrolled in college-preparatory high schools, and more than 80 percent of the alumni of KIPP schools throughout the country have attended college.

It’s clear that we have much more to do to improve student achievement in this country. However, it is also clear that effective schools can and do make a difference.

UPDATE: Jonathan Chait has more.

McCain Tax Plan Gives Nothing To Families In Poverty

Our guest bloggers are Ben Furnas, Robert Gordon, and James Kvaal, who are a research associate and fellows at the Center for American Progress Action Fund, respectively.

Later this morning, Sen. John McCain will visit New Orleans’ Lower 9th Ward as he continues his tour of impoverished America. His rhetoric is great, but so far the scorecard for his “poverty tour” is four days, one new idea: another corporate write-off, this one allowing “companies to write off the cost” of providing high-speed Internet in low-income communities.

Sen. McCain is proposing $3 trillion in tax cuts that would offer nothing to people living and working in poverty. More than half would go to corporations, and much of the rest to high-income taxpayers in the form of AMT relief.

Even McCain’s one tax cut that really will help the middle class — doubling the personal exemption for dependents from $3,500 to $7,000 – will do little or nothing for working poor families. These families usually do not pay any income taxes and thus will not benefit, even though they pay thousands of dollars in sales and payroll taxes. Meanwhile, the largest tax cuts will go to families at the top.

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Read more here.

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