Return to the Food Lands

In the midst of the glittering modern cities of Europe, amongst the high-speed railways, high-tech automotive factories, giant financial centres, and the digital economy that for decades was considered a symbol of civilisational progress, one great anxiety is slowly emerging: what if all of it is actually very fragile? That question once sounded absurd. How could Europe—home of the Industrial Revolution, a centre of technology, the heart of modern capitalism, and one of the world’s largest economic powers—be shaken just because of a geopolitical conflict thousands of kilometres away? Yet the reality of the last few years has shown something different. The global pandemic, the Russia-Ukraine war, soaring energy prices, supply chain disruptions, food inflation, and the latest conflict between the United States and Iran have demonstrated that the modern economy is far more vulnerable than previously imagined. This is where the world is once again hearing an old, frightening term: stagflation. A condition where the economy slows down, unemployment rises, but prices keep climbing. A combination considered a ‘nightmare’ for central banks and modern governments. The term stagflation itself was popularised by British politician Iain Macleod in 1965. However, it truly shook the world during the 1970s oil crisis when the Middle Eastern energy embargo caused Western economies to experience stagnation alongside high inflation. And now, decades later, similar symptoms are beginning to haunt Europe again. This time, the source is not merely a monetary issue, but a more complex combination: energy, geopolitics, industrial dependency, and the fragility of globalisation. When war broke out in the Middle East and energy prices soared, Europe became one of the regions most vulnerable to the impact. Unlike the United States, which has large energy reserves and the dollar as a global currency, the European Union is heavily dependent on energy imports. Europe’s major industries—especially automotive, chemicals, steel, fertilisers, logistics, and heavy manufacturing—were built on the assumption that energy would always be available at relatively low prices. But history, it turns out, does not always submit to economic assumptions. When gas and oil prices surge, production costs rise. When production costs rise, industry begins to weaken. When industry weakens, jobs begin to be threatened. Yet ironically, as the economy slows, the cost of living actually keeps increasing due to energy and logistics inflation. This is the core of stagflation: the economy is sick, but prices remain hot. The worry has recently even begun to be openly acknowledged by EU officials themselves. The European Commissioner for Social Rights and Skills, Roxana Mînzatu, warned that around 1.3 million jobs in Europe are potentially impacted by the energy price surge triggered by the escalation of war in the Middle East. The most worrying is the automotive sector. An estimated 600,000 jobs are at risk in this sector alone. That figure is not just a statistic. Behind it are workers’ families, the middle class, households, industrial villages, and a very long economic chain. For Europe’s automotive industry is not just about cars. It is the heart of Europe’s modern manufacturing economy. If the automotive sector weakens, then steel is impacted, the glass industry is battered, petrochemicals decline, logistics slow down, component supplier SMEs are hit, and public consumption falls. The domino effect is vast. And this is where the paradox of the modern economy begins to show. For decades, the world was taught that the services, financial, high-tech, and heavy industry sectors are symbols of progress. Meanwhile, the agricultural sector was often viewed as ‘traditional’, ‘less modern’, even considered inferior. But when the energy crisis comes, humanity is reminded of a simple fact: people can postpone buying a car, but they cannot postpone eating. This is where an interesting psychological and strategic shift is emerging in Europe. Slowly but surely, the food issue is beginning to be repositioned as a matter of civilisational security. The European Union has started talking about food security, fertiliser security, local agriculture, strategic food reserves, and resilience farming. Many European countries are beginning to realise that being too dependent on global supply chains is a dangerous gamble. Because in conditions of war or energy crisis, the quickest to be shaken are complex industrial systems that are highly dependent on fuel, gas, electricity, and global logistics. Meanwhile, agricultural land continues to produce food as long as the soil is still fertile, water is still available, and people are still willing to plant. Ironically, the sector once considered ‘less prestigious’ is now once again seen as the foundation of survival. Perhaps this is one of the greatest lessons from the modern stagflation era: that the economy can never truly be separated from the land. Over the last few decades, many developed countries placed too much faith in a growth model based on consumption, debt, financialisation, and endless industrial expansion. But that model is highly dependent on one condition: cheap energy. When cheap energy disappears, the entire structure begins to wobble. Factories become expensive. Transport costs swell. Fertiliser prices rise. Electricity bills soar. Purchasing power falls. Industry loses competitiveness. And finally, the government faces an almost impossible dilemma: if interest rates are raised to fight inflation, the economy slumps further. If stimulus is increased to save the economy, inflation climbs higher. This is why stagflation is called the ‘fundamental weakness of the modern economy’. It shows that the contemporary economic system is actually very sensitive to energy and geopolitical disruptions. What is even more interesting is that this crisis also reopens the discussion about the global monetary system.