Free Market failed for decades - now fertilizer subsidies feed Malawi and neithbors

Malawi has had a major problem with general hunger and especially with malnourished children for decades. So the government, led by the new President Bingu wa Mutharika, abandoned the free market prescriptions of the World Bank and the so-called Western experts and started heavily subsidizing fertilizer.

Voila! Within three years, the nation of Malawi is not only feeding itself, but also it is exporting food to surrounding African nations.

Stung by the humiliation of pleading for charity, he [President Bingu wa Mutharika] led the way to reinstating and deepening fertilizer subsidies despite a skeptical reception from the United States and Britain. Malawi's soil, like that across sub-Saharan Africa, is gravely depleted, and many, if not most, of its farmers are too poor to afford fertilizer at market prices.

"As long as I'm president, I don't want to be going to other capitals begging for food," Mutharika declared. Patrick Kabambe, the senior civil servant in the Agriculture Ministry, said the president told his advisers, "Our people are poor because they lack the resources to use the soil and the water we have."

The country's successful use of subsidies is contributing to a broader reappraisal of the crucial role of agriculture in alleviating poverty in Africa and the pivotal importance of public investments in the basics of a farm economy: fertilizer, improved seed, farmer education, credit and agricultural research.

The free market, operating inside the economy, allows individuals to make best use of the tools in the economy, but this instance displays that the economy itself often needs government intervention to perform most effectively.

The Malawi story is another example of the power of a mixed economy over either a totally free market or a socialist-style planned economy. But then, so is the American agricultural economy. That was what President Bingu wa Mutharika copied his plan from, and look how successful the American farmers are in feeding American and exporting food.

Pragmatism is always more important than ideology. Ideologies attempt to simplify reality to the point where mere human beings can comprehend it, and as a result every ideology leaves out a great number of very important facts.