Teaching Comparative

External influences on public policy

When governments have to respond to things outside their control, the policy choices center on things they can control. But those choices do not always (often?) offer realistic or effective alternatives. Consider three recent examples: the gasoline shortage in Iran, the rising price of corn and tortillas in Mexico, and the gasoline shortage in Nigeria.

• How is it that countries that produce great quantities of a product face shortages and dangerous price increases?
• Are these problems related to public policy?
• Can public policy be an effective response to them?
• What are the politics of making those policies?
• Are the politics evidence of democratic governance?
• Can you make generalizations based on these cases?

ONE:
RFE/RL reported on one of the reasons for grassroots dissatisfaction with the Iranian government.

Iran: Power Cuts In An Energy-Rich Land

"Despite its wealth of oil and natural-gas reserves, Iran has faced a gas crunch as people turn up the heat this winter.

"Partial or total energy cutoffs were reported in 11 provinces, with residents of colder western provinces worst affected, and exports to Turkey were suspended for five days...

"Officials have blamed rising consumption and delays in unspecified projects for the shortages...

"In western Iran, the energy cuts led to protests. In Saqqez, in Kurdistan Province, residents gathered outside the district governor's office on January 4 to protest eight days without sufficient gas supplies.

"From there, some 200 protesters went to the city council, then to the town's central square, by which time they numbered about 1,000, according to advarnews.com..."

TWO A:
The Houston Chronicle offers this account of the Mexican case.

Mexico absorbs effects of ethanol push

"High corn prices are wreaking havoc on Mexico's inflation rate and forcing shoppers to pay more for eggs, milk and tortillas. But they're a godsend to farmers...

"The U.S. is the world's No. 1 corn producer and exporter, shipping an estimated 2.2 billion bushels to international buyers last year. Most nations can't compete with govern- ment-subsidized U.S. corn, which countries such as Mexico have come to rely on to fatten their hogs, chickens and cattle.

"But with 110 ethanol plants in the United States snapping up hundreds of millions of bushels and an additional 63 refineries slated to come on line in the next 18 months, some foreign farmers are betting that America will soon have less of the grain available to export...

"Another major concern for Mexico is the effect corn prices are having on consumers.

"President Felipe Calderon signed an accord with businesses last week to curb soaring tortilla prices and protect Mexico's poor from speculative sellers and a surge in the cost of corn driven by U.S. ethanol."


TWO B:
A Dallas-Ft. Worth television station offers more information on the tortilla crisis.

Is Mexico tortilla crisis a wrap?

"President Felipe Calderón sought to defuse a political crisis over the rising cost of corn tortillas Thursday by reaching an agreement with producers to adhere to voluntary price controls on the Mexican staple.

"Mr. Calderón announced the agreement in a ceremony at the presidential residence, Los Pinos, and warned that anti-speculation laws would be enforced.

"'The objective of this agreement ... is to immediately stabilize the price of corn and tortillas in order to directly protect the budget of Mexican families and [guarantee] our economy's continued march forward,' Mr. Calderón said.

"'We will not tolerate speculators or those who seek to monopolize,' he said. 'We are going to apply the law firmly to punish those who would take advantage of the necessity of the people.'

"The crisis was distracting the public from Mr. Calderón's announcements of new social programs to fight poverty..."


THREE:

Vanguard (Lagos) reported on the government's consideration of actions to resolve the problems of gasoline pricing and distribution in Nigeria.

Nigerians Groan As Fuel Scarcity Bites Harder

"ECONOMIC activities are being grossly impacted by the persistent scarcity of petroleum products nationwide...

"Already, the Senate has set a machinery in motion towards unraveling the petrol scarcity with summons on the authorities of the Pipeline Products Marketing Company (PPMC) and of the Petroleum Products and Price Regulatory Agency (PPPRA).

"Similarly, Governor Bola Tinubu of Lagos State, yesterday, urged the Federal Government to scrap the Nigerian National Petroleum Corporation (NNPC) for, according to him, failing in its responsibilities to the nation.

"In Lagos, economic activities are grinding to a halt as long motor queues at petrol stations impede vehicular and human traffic within the metropolis.

"In places like Ibadan, Osogbo, Ilorin and Ile-Ife yesterday, petrol was available in only a few filling stations...

"In most parts of the South-South, including Port Harcourt, Yenagoa, Warri, Uyo and Calabar, the scarcity of petroleum products persisted with serious implications for economic activities...

"Addressing newsmen in Abuja, weekend, Dr. Funsho Kupolokun, Group Managing Director of the NNPC... [said] 'Measures taken to address the situation include community policing... posting of mobile task force along pipelines, engaging the Nigerian Security & Civil Defence Corps to provide intelligence as well as co-operation from IPMAN and PTD with NNPC on establishing anti-vandalisation committees to identify and report vandals.'...

"Responding to a question on the efforts of the Senate to tackle the persistent scarcity of petroleum products and its debilitating effects, Senator David Brigidi, Chairman of the Senate Committee on Downstream Petroleum ruled out pricing as a factor in the crisis..."

posted by Ken Wedding @ 10:53 AM