Caesar gives bread to his people
Today the BBC reported that Egyptian President Mubarak ordered the army to distribute more bread. This is a very worrying sign. Although many from the government and private sector are optimistic about the Egyptian economy, there is certainly a growing underclass. Some say there is a rising middle class, and that salaries for young Egyptians are rising, but I have yet to see any solid figures. It appears that the rich keep getting richer and the number of poor keeps growing. As proof of a huge lower class, the government will add 15 million people on public pension distribution.
I have been talking about this for a few months now with some friends. What will happen when the price of bread doubles? How will the government manage the massive bread subsidy? My best guess is that people are going to become seriously restless. Already the bread is more expensive, and I noticed just last night that one Egyptian pound buys three pieces of baladi bread instead of the four it bought just a couple weeks ago. The BBC did a story on bread this week. I suggest watching the attached video.
I realize prices are rising around the world, but inflation is getting out of control here. One notices this much more in a developing country because these people have so little to spend as it is. In less than three months this year, the UN World Food Program estimates average household expenditure in Egypt has risen by 50%, according to AFP.
I don't expect a massive uprising in Egypt (although this did happen in 1977 when the government announced it would remove bread subsidies), but four people have died in bread lines and protests are popping up across the country from factory workers to doctors for higher wages.
John Maynard Keynes wrote: "Men will not always die quietly. For starvation, which brings to some lethargy and a helpless despair, drives other temperaments to the nervous instability of hysteria and to a mad despair. And these in their distress may overturn the remnants of organization and submerge civilization itself in their attempts to satisfy desperately the overwhelming needs of the individual. This is the danger against which all our resources and courage and idealism must now cooperate." (Heilbroner, 259)
There are signs on the surface that Egypt is moving in the right direction, but if the government doesn't find ways to curb prices from rising so quickly, it is going to have a crisis on its hands soon. And with the rising price of wheat worldwide, there's only so much bread Caesar can give to his people.
Bibliography:
Heilbroner, Robert L., The Worldly Philosophers. Touchstone. 1999. New York.
read more | digg story
I have been talking about this for a few months now with some friends. What will happen when the price of bread doubles? How will the government manage the massive bread subsidy? My best guess is that people are going to become seriously restless. Already the bread is more expensive, and I noticed just last night that one Egyptian pound buys three pieces of baladi bread instead of the four it bought just a couple weeks ago. The BBC did a story on bread this week. I suggest watching the attached video.
I realize prices are rising around the world, but inflation is getting out of control here. One notices this much more in a developing country because these people have so little to spend as it is. In less than three months this year, the UN World Food Program estimates average household expenditure in Egypt has risen by 50%, according to AFP.
I don't expect a massive uprising in Egypt (although this did happen in 1977 when the government announced it would remove bread subsidies), but four people have died in bread lines and protests are popping up across the country from factory workers to doctors for higher wages.
John Maynard Keynes wrote: "Men will not always die quietly. For starvation, which brings to some lethargy and a helpless despair, drives other temperaments to the nervous instability of hysteria and to a mad despair. And these in their distress may overturn the remnants of organization and submerge civilization itself in their attempts to satisfy desperately the overwhelming needs of the individual. This is the danger against which all our resources and courage and idealism must now cooperate." (Heilbroner, 259)
There are signs on the surface that Egypt is moving in the right direction, but if the government doesn't find ways to curb prices from rising so quickly, it is going to have a crisis on its hands soon. And with the rising price of wheat worldwide, there's only so much bread Caesar can give to his people.
Bibliography:
Heilbroner, Robert L., The Worldly Philosophers. Touchstone. 1999. New York.
read more | digg story
posted by Andrew Bossone at
5:35 PM
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