Just when it seemed the world had discounted enough bad news for a decade - surging petrol prices, the collapse of huge merchant bankers, the vast American secondary mortgage market meltdown - we find another crisis about as bad, the doubling of food prices.

True, we knew these were coming - accelerating emerging market demand, more climatic disturbances, diminishing agricultural resources, rising production costs and competing biofuel demand. But the result is the same - almost a panic in countries like India, Indonesia, the Philippines, where growing populations have been crimping food supplies.

So we are looking at a few years where, at best, we have almost no net economic growth, we pay far more for food, travel is a pain, we don't trust our banking systems let alone our stock markets, and we have to endure all the political consequences of these shifting economic fortunes. We have in the back of our minds a world economic depression that, thanks to globalization, makes that of the 1930's look puny.

But let's look at it another way. We've known about all the problems now exploding in front of us. There is no surprise about any of them. The surprise is that they all seem to come together at the same time. But that should be no surprise. Bad news triggers bad news - because mistakes and problems begat bigger problems until solutions are found.

Cool things down

Good news tends to trigger good news because, as the economists say, it is 'virtuous'. A food problem doubles as an energy problem because it's involved with the bio-fuel issue: crop land being converted for energy solutions. You can't have it both ways. There are several preliminary pieces of good news. Firstly, ministries and international organizations are dealing with the bad news, piece by piece. There are few instances of 'ducking' and 'denial'. There are even international conferences being held to speed things up - like the Bangkok conference on global warming.

Other than the American leadership - an important exception - every government in the world is concentrated on averting a global economic collapse. And at least for once the Bush administration isn't working against the global consensus, it is simply not empowering a consensus and solutions in the way it should, as the world's largest economy. It would be easy to say that things are a lot worse than the average educated reader realizes - except that so many steps are being taken to cool things down.

There really are only two possibilities. Things fall apart. Heavens knows there are so many centrifugal forces at work in the world economy that that shouldn't be a surprise. A meltdown. Capital markets declining by half or more. Food riots overthrowing governments like dominoes in Asia..Then there's the more likely possibility. Part of it is just 'a little of this and a little of that.' Band-Aids like the US Fed lowering interest rates dramatically to keep the US recession anageable. The Philippine government taking drastic measures to keep adequate rice supplies and to savagely deal with hoarding.

The big deals, the surgery, will be basic. It will be seen in the future as the examination test and commencement for globalization. It's happening because of globalization but if globalization is the problem - because it links problems from one state or region to another - it's also the solution.

There has never been a famine for lack of food. It's always about moving it efficiently. In fact most famines were government induced, often sought, to keep unruly provinces on their knees. Now, governments are pooling resources to move food around to the most needed places.

Situation is serious

Within a few years the market will have started responding and prices can come down, as new sources of basic commodities emerge. But we just have to pay a lot more for food in the meantime. And for those reading this column, that's not such a big deal; doubling the market price of rice barely affects our overall dinner budget. Think rather of the little guys in the provinces already at the margins, for whom food prices are half, three quarters
of budget. He's the one to feel for.

There are other novel dimensions to the present world crisis - for that surely is what it is. The solutions are not American-driven. Almost always in the past - think Marshall Plan, the 1985 Plaza Accords, or any of the big international economic crises in the ensuing 60 years after orld War II - Washington drove the world plans. Now we're seeing that the world can work together and different leaders are emerging for different parts of the crisis. The IMF is trying not to be left behind, even.

I don't want to be a Pollyanna. The situation is serious. Yet many countries are still generating growth - even the United States, where a small 1% income rise means US$150 billion in additional world resources, or roughly the whole Thai economy. India and China are still booming, even if the rating agencies are lowering expectations by 1-2% from the sky-high previous levels.

Most important, there's a will everywhere to face the problems. Mr Bush may have his head in the sand for most problems, but he consented to a huge bail out for Bear Stearns. 'Damage Limitation' is the watchword today. The world isn't on the verge of collapse and even though there already is a lot of damage. But it doesn't have to engulf us, and the first thing to do to prevent that is to think positively and be grateful for the number of creative leaders around
the world finding solutions to these huge problems.

W SCOTT THOMPSON is a national security expert who served for American Presidents and is a professor emeritus at the Fletcher School of Law and Diplomacy. He is the author or editor of 13 books on world political issues and resides in Washington, Bali and Manila "