Imperialism and the world food crisis
Part 1
The uprisings in Egypt, Tunisia and other parts of
the Arab world are universally recognised to be related to the escalating cost
of staple foods in those countries.
Although food prices have risen everywhere, it is
in third-world countries that the price hikes have been highest, and there is
nothing, apart from war, like the onset of hunger to fuel social unrest.
The French revolution was triggered by a bread
crisis. The genocide that racked and disgraced Rwanda in 1994 was related to
destitution caused by a world collapse in the price of coffee, Rwanda’s principal export, on which its entire economy was dependent.
In 1999 ex US president Jimmy Carter drew attention
to the problems of countries “whose economies depend on agriculture but lack
the means to make their farmland productive”, concluding that “There can
be no peace until people have enough to eat. Hungry people are not peaceful
people.” (See Jimmy Carter, ‘First step to peace is eradicating hunger’, International
Herald Tribune, 17 June 1999).
About a billion people suffer from chronic hunger
in the world today, and a further 2 billion are estimated to be malnourished.
About 30% of Africa’s population is undernourished. About 3.5 million children
under 5 in developing countries die from undernutrition-related causes each
year. In Haiti things are so bad that people have resorted to eating mud.
Yet between June and December 2010 prices have
soared. For example, the price of wheat has increased by large amounts in Kyrgyzstan (54%), Bangla Desh (45%), Tajikstan (37%), Mongolia (33%), Azerbaijan (19%), Sudan (16%) and Pakistan (16%). World maize prices in January 2011 were some 73% higher than 6
months previously. Other staples have suffered similar astronomic rises.
What is surprising, however, is that there is in
fact no absolute shortage of foodstuffs produced in the world. What is
produced is capable of feeding the whole of humanity, with some to spare.
It would appear, for instance, that “… with
the global grain production at a little over 300kg per person … there is more
than enough to supply the 230 kg per person needed for an adequate calorific
intake if the grain were equitably distributed.” (Fred Magdoff and Brian
Tokar, ‘Agriculture and food in crisis: an overview’, in their book Agriculture
and food in crisis, Monthly Review Press, New York, 2010, p. 12). Of
course, good nutrition requires more than the calorific nutrition provided by
grains but it is clear that there is plenty of leeway for conversion of grain
into protein foods (by using it for raising animals) to satisfy everybody – and
of course there is also plenty of food production that is not directly or
indirectly grain dependent, such as the production of vegetables.
The fact is, however, that food is not equitably
distributed. For a start it is estimated that half of it is simply thrown away
or destroyed (according to the Stockholm International Water Institute,
sufficient food to feed 3 billion people, half the world’s population, is
wasted).
Secondly, far more grain than is necessary to
produce a sufficiency is diverted into the production of high protein foods –
i.e., is used to feed animals – for the benefit of those who can afford to buy
them and, increasingly, it is being diverted to the production of biofuels. In
addition there has in any event been a decline in per capita world cereal
output, which was 335kg per capita in 1980-85 but was down to 310kg per capita
in 2000-05 – a phenomenon we propose to examine in more detail in the next
issue of Lalkar. According to the United Nations (‘World Economic
Situation and Prospects 2009’, p.48), “production has fallen woefully short
of growth in food demand” because “productivity growth for major food
crops has stalled, and there has been no significant increase in the use of
cultivated land”.
As a result of all these factors, the apparent
sufficiency of grain production has transformed itself into severe shortages,
which in turn have given rise to price rises that have priced increasing
numbers of the poor out of the market, condemning them to hunger and
malnutrition.
The food import bills of the Least
Developed Countries (LDCs) jumped 30% from 2005 to 2006 and another 37% between
2007 and 2008. Their food import bill was $17.9m in 2007 and $24.6m in 2008.
“The annual food import basket in LDCs cost more than three times that of
2000, not because of the increased volume of food imports, but as a result of
rising food prices” (‘World economic situation and prospects’, pp. 7-8).
An FAO ‘Briefing Paper: Hunger on the
rise’, published in 2008, noted that these price rises added 75 million people
to the ranks of the hungry and drove an estimated 125 million people in
developing countries into extreme poverty.
William Rees and Mathis Wackernagel (in
‘Ecological footprints and appropriated carrying capacity’ in AM Jansson and
other (eds) Investing in natural capital: the ecological economics approach
to sustainability, Island Press, Washington, 1994) calculated that it takes
the earth one year and four months to regenerate what humanity consumes in 12
months – and this was before the biofuels explosion.
Considerable blame for this overshoot lies
with the wasteful diets of the relatively well-off (which includes the
junk-food diets of the poor in rich countries) because these contain quantities
of animal products far in excess of what is desirable for a healthy diet,
producing obesity and disease. Indeed, it has been estimated that “As many
as three out of every five of the children presently coming through school in
the well-off world are destined to die as a result of what they eat, from the
host of chronic disorders that result from overnutrition” (Julian Cribb, The
coming famine, University of California Press, Los Angeles, 2010).
As will be explained further below, food production
and distribution has increasingly been falling into the grip of predatory
imperialist multinationals whose sole purpose is profit – and profits are
easier to extract from force feeding the relatively wealthy than from catering
to the basic needs of the world’s poor.
Left to the tender mercies of capitalism, with its
drive for profits, the system of food production and distribution not only
condemns millions of people to starvation, but in addition causes massive
ecological devastation that is likely to cause apocalyptic conditions for the
next generation – an issue that will be examined in more detail in the next
issue of Lalkar.
Monopolisation of food
The problems of equitable food distribution have
grown worse over the last few decades as the food industry has been taken over
throughout the world by a process of monopolisation.
According to Philip McMichael (‘The world food
crisis in historical perspective’ in Magdoff and Tokar, op.cit.), “Food
stocks are highly centralised – five corporations control 90 per cent of the
international grain trade, three countries produce 70 percent of exported corn,
and the thirty largest food retailers control one-third of world grocery sales”
(p.62).
And John Wilkinson in the same volume explains in
‘The globalisation of agribusiness’, p. 157-8):
“The changing global dynamics of demand and the
acceptance of the ‘free market’ liberal approach by developing countries [had]
already occurred [by the 1980s] in most advanced capitalist
countries. In the United States, concentration levels for the top four or five
firms have been calculated for the major upstream inputs (materials, resources,
energy, fertilisers, etc) and downstream outputs (farm products, processing,
and sales markets). The main segments have ratios averaging well over the 40
percent level – considered the threshold for a market oligopoly – and often in
the 70-80 percent range … The major agricultural commodities that make up world
trade are also subject to high levels of concentration – grains and oils,
coffee, cocoa, and bananas. In addition, a substantial proportion of trade is
now organised and co-ordinated by lead firms. This is particularly the case
for the so-called non-traditional exports (seafood, fruits, vegetables,
flowers), very often under the control of large-scale retailers…
“In smaller market segments, there are even
higher levels of concentration involving duopolies and even monopolies … the
major firms grow both horizontally (in like sectors) and vertically
(integrating both downstream suppliers and upstream markets for a given
industry) – leading to concentration and economic power that extends to broad
sections of the agrifood system…”
And further:
“The scale of the [monopolist] firms is
staggering. In 2007, the food processor Nestlé posted a profit of $9.7
billion, greater than the 2007 GDP of the sixty-five poorest countries.
Wal-Mart, the world’s largest grocer, posted profits of $13.3 billion for the
fiscal year ending January 31, 2009. That is more than the 2007 GDP of almost
half the countries of the world … in profits alone … With this market power
comes the ability both to predict (and to some extent set) prices, the
political clout to affect trade and investment policy in many of the more than
one hundred countries in which the biggest firms operate, ad the power to keep
would-be competitors at bay” (p.111).
One of the most dire consequences of this
monopolisation of the food industry is the fact that the sheer economic power
of the monopolies enables them to dictate policy to the governments of the
countries in which they operate and, needless to say, their demands on
government aim to maximise their profits, regardless of the interests – indeed
normally at the expense – of the people those governments are supposed to
represent.
It is the interests of agribusiness that have
driven the governments of imperialist countries to impose Structural Adjustment
Programmes (SAPs) on the oppressed countries, through the WTO, the IMF and the
World Bank. These SAPs bear heavy responsibility for the rising prices of
staples that beset oppressed countries today.
At the Uruguay Round of trade negotiations that
took place in 1986, and which set up the World Trade Organisation, various
governments signed an Agreement on Agriculture, the first multilateral
agreement to create binding rules on agricultural trade.
According to Sophia Murphy (‘Free trade in
agriculture: a bad idea whose time is done’ – in Magdoff and Tokar, op.cit.
at p. 105):
“The argument that tied food security to
unfettered trade went something like this: liberalise world agricultural
markets by ending subsidies to inefficient producers, tear down tariff walls
and end the practice of holding government-controlled food stocks. World
market supplies will then move to where need is greatest. In turn world food
prices for agricultural commodities will rise, which will be good for farmers
who are profitable in the deregulated markets. At the same time, consumers
will pay less, benefiting from the efficiencies created by sharper
competition. Environmental efficiencies are gained by concentrating production
of particular crops in countries that have the greatest ‘comparative
advantage’, and private companies are able to manage the business of getting
food from where it is grown to where it is needed, cutting significant costs
out of government budgets in those countries where the state used to play all
or some of this role …”
In practice, however, the imperialist countries
continued to protect their own agriculture with a whole host of subsidies,
while forcing liberalisation on oppressed countries. In the face of
imperialist competition masses of farmers in oppressed countries were driven
into bankruptcy.
Under the aegis of the World Trade Organisation
(WTO), and the strong-arm discipline of the International Monetary Fund (IMF)
and the World Bank (WB), oppressed countries were also forced to abandon their
tradition of accumulating public food stocks that previously offered a defence
against shortages. These stocks helped stabilise prices as government would
buy up food stocks at times of excess supply, thereby maintaining a reasonable
price for farmers, but release the food at times of insufficient supply, thus
preventing excessive price rises. Of course, these government interventions
stood in the way of the maximisation of profit by the imperialist agrifood
multinationals and they had therefore to be outlawed. The result was that by
1998, according to the FAO, net food-importing oppressed countries experienced
a 20% price increase.
The Keynesian Joan Robinson was quite right when
she noted that:
“When Ricardo set out the case against
protection he was supporting British economic interests. Free trade ruined
Portuguese industry. Free trade for others is in the interests of the
strongest competitor in world markets, and a sufficiently strong competitor has
no need for protection at home” (‘What are the questions?’, in Collected
Economic Papers vol 5, Bas Blackwell, Oxford, 1979, pp. 1-29).
An example of how ‘free trade’ impacts on oppressed
countries is given by Fred Magdoff and Brian Tokar (op.cit. pp. 21-22):
“Corporations that pioneered factory-scale
animal production in the United States, displacing many independent hog, cattle
and poultry farmers, are now also producing abroad. They achieve low costs of
production by: (a) having very large facilities, (b) controlling and providing
all the feed and medicines; (c) mandating that the people raising the animals
… essentially work as labourers under contracts favourable to the corporation
…; (d) passing on responsibility for manure and other waste … Smithfield, a
Virginia based Fortune 500 corporation, has used its power and connections to
expand into Eastern Europe. In the space of a few years, about 90 percent of
Romania’s and 56 percent of Poland’s hog farmers were put out of business
because of competition from Smithfield – creating social as well as
environmental havoc. In addition, frozen pork products are exported to West
Africa – Liberia, Equatorial Guinea, and the Ivory Coast – where local
producers are also put out of business. Smithfield receives export incentive
funds from Poland and sells its pork at about half the price sought by local
producers in the Ivory Coast”.
In this case the imperialist produced food is
cheaper, but the economic activity of the target country has been shot to
pieces by a multitude of imperialist interventions such as Smithfield’s, as a
result of which increasing numbers of people are unable to pay even the reduced
price of pork and other commodities.
Professor Jeffery Sachs of Columbia University, who was initially an enthusiastic supporter of free trade as the cure for all ills,
has in the light of experience had the honesty and humility to revise his views
somewhat and has concluded:
“The whole thing was based on the idea that if
you take away the government from the poorest of the poor that somehow these
markets will solve the problems … but markets can’t step in and won’t step in
when people have nothing. And if you take away help, you leave them to die”
(quoted in Celia W Dugger, ‘World Bank Neglects African Agriculture, Study
Says’, New York Times, 15 October 2007).
Not only do prices rise because the stabilization
mechanisms practised by governments have been forcibly dismantled, but also
because of the straightforward and time-honoured monopolist practice of price
fixing.
Philip McMichael (op.cit.) gives the
poignant example of how these processes affected Mexico (pp. 63-64):
“While corn prices fell continuously following
NAFTA’s liberalization of corn imports from the United States, tortilla prices
tripled during the 1990s. And during 2006, when world corn prices did rise
rapidly, tortilla prices doubled again … With only two food processors
controlling 97 per cent of the industrial corn flour market, and the state
reducing food subsidies, tortilla riots have become part of the political
landscape – spurred by a 10 percent reduction in wages resulting from rural
migrants displaced by corn imports”.
In this context, Walden Bello and Mara Banera (in
Magdoff and Tokar, pp. 39-40) remind us:
“… An intriguing question escaped many
observers: how on earth did Mexicans, who live in the land where corn was first
domesticated, become ‘dependent’ on imports of US corn in the first place?
“The Mexican food crisis cannot be fully
understood without taking into account the fact that in the years preceding the
tortilla crisis, the homeland of corn had been converted to a corn importing
economy by free market policies promoted by the International Monetary Fund,
the World Bank, and Washington … The key link between the food crisis, the
drug wars, and the massive migration to the North has been structural
adjustment”.
It was through Structural Adjustment programmes
that support was withdrawn from peasant farmers alongside NAFTA-imposed trade
liberalisation with the tragic results that are today all too obvious.
And while the masses all over the world are hit by
starvation, the rates of profit for agribusiness are always more than healthy.
Waste
The monopolisation of food production and
distribution goes hand in hand with the exponential expansion of unnecessary
waste of food.
In 2005 BBC Radio 4 broadcast a programme, ‘Costing
the earth’, which, using figures produced by DEFRA and the NFU, graphically
exposed the egregious waste of food that is happening every day in the UK alone. 30-40% of all produce is binned. Every year in the UK, food worth £20 bn is
discarded in its journey from the farmyard to the fridge. It just so happens
that £20 bn is also the annual figure that, according to the UN, would be
required to eliminate starvation in Africa.
But after the food reaches the fridge, even more is
wasted, with an average of £420 per British adult per annum (£23 bn a year)
being thrown away, largely because it has not been used by the ‘best before’
date. Altogether British household are estimated to throw away 6.7 million
tonnes a year, half of which would have been perfectly edible when bought (see
Sean Poulter, ‘Britain, the world’s most wasteful nation, Mail on Sunday, 17
March 2007).
All this waste is related to the activities of food
distribution monopolies, i.e., the big supermarkets. For a start, they
themselves destroy vast amounts of edible food. According to the Guardian of
15 April 2005:
“Tesco says it sent 131,000 tonnes of waste to
landfill in 2004, of which ‘the majority was food’. Sainsbury’s, which
distributes food to more than 400 charities, says it sent 91,000 tonnes to
landfill, of which at least 70,000 tonnes is believed to be waste food”.
Meanwhile a woman called Sacha Hall faces
conviction for theft for having helped herself in January this year to £215.16
worth of food, including 100 packs of ham, from Tesco dustbins in Great Baddow,
Essex. Tesco sent police to find her. They raided her home and hauled her
away in handcuffs. The case remains to be heard.
In all it is believed supermarkets may bin some
500,000 tonnes of food a year; while UK farmers, because the supermarkets to
whom they supply require unblemished, specifically-sized, shaped and coloured
food, find themselves obliged to trash some 30-40% by weight of their various
crops. These do at least tend to get ploughed back into the land rather than
adding to the rubbish mountains, but they still represent an appalling waste of
the water, fertilizer, and land that has been used to grow them.
Even household waste arises because in the
interests of profit supermarkets encourage customers to buy too much and stamp
often unrealistic ‘best before’ dates on the food that they sell.
Wasting food has been costing the average British
household some £35 a week. Perhaps a small benefit of the current economic
crisis and the austerity to which capitalism is subjecting the British population
is that this waste will be drastically curtailed … but then our supermarkets
would be bankrupted!
Waste of food is not of course a purely British
phenomenon, even if the Mail on Sunday does claim Britain leads the world on this front.
Globally the FAO estimates a full third of all
fruits and vegetables grown never reach the customer at all, perishing in the
fields, in storage, or en route, and being attacked by a ravenous horde of
moulds, insects and rodents. Spoilage claims 30% of India’s fresh produce,
while postharvest losses of fruit and vegetables in some African countries can
reach 50%, says the World Vegetable Center.
We harvest around 4,600 calories per person per
day, it says, but only 2000 of these actually reach our mouths (see Julian
Cribb, op.cit., p.70) (see
TABLE 1).
TABLE
1
Daily calories per
head of population
Edible crops harvested
4600
LESS Post harvest losses
600
4000
LESS Animal feed
1700
2300
ADD Meat and dairy produce
500
2800
LESS Losses and waste in
distribution and households
800
2000
Available calories per head of population
2000
Julian Cribb remarks on this: “A
world in which a billion people go to bed hungry throws away food sufficient to
feed three billion”. (op.cit. p.71).
Biofuels
If biofuels are added to the equation it can
readily be seen what disaster awaits, since the table reproduced here takes no
account of biofuels.
Yet the latter have become the great white
hope of the imperialist countries facing the prospect of dwindling supplies of
fossil fuels and asking themselves the question ‘What will happen when the oil
runs out?’
President Bush embraced agrofuel development with
total commitment. In 2007 the US Congress passed the Energy Independence and
Security Act which aims to facilitate increasing US agrofuel production from
4.7 bn gallons in 2007 to over 36 bn in 2022.
Obama shows every sign of following in
Bush’s footsteps and any possibility of going back on this policy has been
dismissed out of hand, notwithstanding the alarm expressed by scientists around
the world.
In 2008 around 30% of US corn was used for
ethanol production, which cannot but have impacted on the world price of corn
as the US is a major exporter. It is also suspected that much of the land that
imperialist concerns are acquiring in huge tracts in such countries as Philippines, Cambodia and Madagascar are destined to be turned over to agrofuel production.
Half of Brazil’s sugarcane crop is also
converted into fuel. European monopolies too are in on the action. According
to Action Aid, European companies “have already secured or requested at
least 5 million hectares of land for industrial biofuels in developing
countries” (Tim Rice, ‘Meals per gallon’, Action Aid, London, 2010). This
is an area equivalent in size to the whole of Denmark.
As a means of making good the loss of
energy supplies that will necessarily occur as oil production reaches its peak
(if indeed it has not already done so), those who see biofuels as the answer
are on a hiding to nothing.
Oxfam Briefing Paper no. 114, ‘Another
inconvenient truth: how biofuel policies are deepening poverty and accelerating
climate change’ (London, 25 June 2008) has worked out that even if the world’s
entire supply of carbohydrates (grains and sugar) were all used to produce
biofuel, this would replace at most 40% of world petrol consumption.
Action Aid also estimates that on current
trends the conversion of food into biofuels would raise food prices to such an
extent that the number of people in the world suffering from hunger would rise
by 50%, from 1 billion to 1.5 billion.
Lester Brown told the New Scientist (see
Fred Pearce, ‘Fuels gold: big risks of the biofuel revolution’, New
Scientist no. 2570, September 2006) that “the corn required to fill a SUV
tank with bioethanol just once could feed one person for a year”.
However, since the demand for petrol on the part of
the owners of motor vehicles and aggressive imperialist governments seeking to
power their killing machines is effective demand, i.e., demand backed up by
cash in hand, their requirements will always take precedence in a capitalist
world to the demands of the poor for food!
[To be continued in the next issue of LALKAR]