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If you do that they will run out of money as they can't afford the expensive food.
Just don't build any food processing buildings until you have middle class. The poor will gladly eat raw meat and grain.
Yea, since there is no way for you to lose money until you get to trading. All the Pia just recirculating around in the city. You could tax ratizens with over 500 Pia 80% of their wealth and redistribute it out again through subsidy. Until you can find a way to reliably supply your city with 3 different necessities, there is no reason to have any ratizens hoarding wealth.
Yes.
2. Your Ratizen are poor, can't afford food. In this game, your Ratizen 'buy' food not just take it from chest.
3. Bug, If you limit Input your Storage for Grain or Raw Meat for example, even though there's still inside, your Ratizen can't buy/eat it. Same goes if you limit Output/Release (but this isn't a bug, but for intentional purpose).