Recent food price spikes were largely driven by speculators. Another spike is expected in 2013 and there are fears that a food price bubble could impact the entire global supply chain.
Could a Latin American country use deception and economic warfare to fight back? Regulating the speculation market, one of the leading and more sensible recommendations, is playing defense. It will take significant resources while speculators work to get around regulations.
All it takes is a few vindictive leaders with resources and motivation to finally break the speculator's economic games for that war to begin. One leader of a major economy or a few key countries from smaller economies could coordinate to distribute misleading information and try to force speculators into making mistakes. A country attempting to manipulate the market prices to throw off speculators and harm their businesses would be criticized by most major economies, but it's likely they would have reached a point where they don't care.
This sort of deception and economic warfare would be difficult, but not impossible. More troubling, like real wars, the ongoing dispute if done correctly would likely cause world markets to shake violently, leading to a number of second and third order consequences that would likely hurt everyone.
It's best if we don't get to that sort of economic war moment that impacts the food everyone needs. However, the food price speculation debate is usually put in terms of regulate or not regulate. If a group of countries force that debate into terms of regulate or economic warfare, it would draw attention to the issue and create a more likely environment for regulation.
Like most things on this blog, I'm not recommending any country go down this route, just speculating on an out of the box scenario.
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