Showing posts with label globalization. Show all posts
Showing posts with label globalization. Show all posts

Thursday, November 13, 2008


INTERNATIONAL LABOUR:
WORKERS VERSUS NESTLÉ ACROSS THE WORLD:
The recent struggle for trade union rights amongst Polish employees of Nestlé (see previous item here at Molly's Blog) is hardly the only one occurring across the globe, as the corporation's behavior is pretty well the same the world over. Here's a story from the IUF about some current struggles that their affiliates are waging against Nestlé in several countries.
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Indonesia, Peru, Brazil: Nestlé Workers Worldwide Demand Decent Work, Respect for Union Rights:
Union action is growing at Nestlé operations around the world as workers seek compensation for eroded purchasing power, a halt to growing casualization and respect for trade union rights, including the basic union right to collective bargaining with the world's largest food company.
On November 8, the IUF-affiliated Nestle Indonesia Workers Union - Panjang (SBNI-P) held another mass demonstration to raise public awareness of their struggle, this time in the heart of Lampung, Sumatra. The union has been struggling to negotiate a new collective agreement since late 2007. Management's response has been harassment, intimidation, forced transfers and threats against union officers. As they attempted in Perm, Russia, where international union pressure eventually forced management to back down, Nestlé is insisting that it cannot disclose (let alone negotiate!) the wage scale with the union for reasons of "commercial secrecy."
The IUF has submitted a complaint concerning Nestle Indonesia's consistently aggressive anti-union actions over the past year to the OECD National Contact Point in Nestlé's home country of Switzerland, since these practices breach the OECD Guidelines on Multinational Enterprises.
In Peru, Nestlé management has also entered into conflict with the IUF's affiliate SUNTRANEP, which has been seeking to re-negotiate the collective agreement covering its membership at the Lima factory and the Chiclayo distribution centre since February of this year. The company has rejected the union's demand for a wage increase to cover inflation and intends to introduce new wage categories without negotiation, indicating that this has been imposed by Nestlé headquarters in Switzerland. In September, management attempted to entirely short-circuit the collective bargaining process by writing to the workers at home, urging them to accept the company's offer! Following numerous negotiating sessions, conciliation meetings and meetings under the auspices of the Ministry of Labour, a deadlock has been reached and the union is on strike.
In Brazil, IUF affiliated unions are mobilizing in support of their demand for a state-level agreement with Nestlé covering nine sites in the state of São Paulo. Hard hit by the rising cost of food and other necessities, the union demands include: a 40-hour workweek in all units: an end to contract and agency labour, with equal pay and conditions for all workers; and a real wage increase of 10%, with full compensation for losses due to inflation.

Wednesday, November 12, 2008


INTERNATIONAL LABOUR-POLAND:
POLISH WORKERS VERSUS NESTLÉ:
The following article is from the Polish anarchist news site Centrum Informacji Anarchistycznej. It's particularly apt as the trial for unfair dismissal mentioned below began last Monday. A few notes are in order. The Polish Union of Syndicalists is an anarcho-syndicalist union federation affiliated with the AIT-IWA, the anarcho-syndicalist international. There is another anarcho-syndicalist union in Poland, less active (I believe) and not affiliated with the AIt, the Workers' Initiative. In Poland, like most of Europe and unlike here in North America there are often several unions represented at any one workplace.
The Nestlé Corporation, the largest food company in the world, has a particularly long rap sheet. It is the subject of the longest running boycott operating today. Since 1977 it has been subject to a boycott because of its promotion of infant formula over breast feeding. This action is presently coordinated by the International Nestlé Boycott Committee, and their secretariat is the British International Baby Food Action Network. During the recent melamine in milk scandal in China the Nestlé company was implicated (see Molly's Blog Sept. 25, Sept 26, Sept 28 and Oct 1 of this year). During last year's melamine in pet food events Nestlé, under the Nestlé-Purina label was also involved (See Molly`s Blog March 24 and April 19 2007).
The company has also been the target of other labour campaigns for its abuses of workers' rights. These include Russian workers (See Molly's Blog March 28, 2008 and June 9, 2008), and its operations in the Philippines. The later campaign is being found by the Filipino Union Federation the Kilusang Mayo Uno. All tolf a rather long record, and most of it isn't even described here. For further information consult Nestlé Watch.
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Nestle attempts to break trade-unions in Alima Gerber in Poland:

In September this year, Jacek Kotula, the president of the workplace commission of the “Solidarity” trade-union in Alima Gerber S.A. in Rzeszow, Poland (currently owned by Nestle) has been dismissed on disciplinary grounds. This is one of many cases of contempt for workers’s rights by large corporations operating in Poland. It is not the first time that Nestle workers have to fight with Nestle in order to have their basic rights respected in various Nestle factories spread around the world. Russian workers are still in the process of struggling for the right to negotiate wages.

Below, we present an interview with Mr. Jacek, made by a member of the Union of Syndicalists of Poland (ZSP).

ZSP: The official reason given for your dismissal was a conversation you had with a Polish farmer, in which you informed him that Alima Gerber imports apples from Italy instead of buying it from the local farmers. In the opinion of the management, this conversation was detrimental to the interests of the company. Do you think it was the real reason why you got fired?
"Of course, this was just a pretext to get rid of me. The real reason was my activity and the activity of the workplace trade-union commission of “Solidarity” presided by me for 3 years. Let me just mention that since July 2008 our commission grew by 50% and our activity has expanded to Nestle in Warsaw. I have demanded wage raises of about 140 Euro monthly. Currently, a regular employee earns about 350 Euro after tax.

The employer was not interested in negotiations. I have also proposed to sign an agreement about combating stress-related problems. The management falsely claimed that there are no legal grounds to introduce such a program. I have also presented the facts related to the discrimination of our employees in comparison with another Nestle plant in Poland, where workers earn 50% more than the ones in Rzeszow, while performing similar work.

Since there was no reaction, I have sent a letter about the case to the United Nations. I have indicated the many illegal actions of the management of the factory, confirmed many times by the Work Inspectorate. I have asked the president of Nestle Poland to meet me regarding an important issue I have mentioned in writing. Each time, I was faced with a wall of indifference. In the end, they just got rid of me in the most brutal fashion - by way of a dismissal on disciplinary grounds.

The conversation with the president of the union of farmers of Alima Gerber which I had and the alleged encouragement to negotiate high prices for fruit and vegetables was only a sad pretext to get rid of me after 16 years of work there."

ZSP: How did your colleagues and union members react to the management's decision? Did the local commission act in your defence?
"The decision to dismiss me was a shock for everyone. My colleagues from the Solidarity union gathered signatures on a protest against my dismissal. Two thirds of the workforce signed the protest. The union commission, nor the work council, did accept my dismissal. Despite this, the employer knowingly broke the law by dismissing a union representative protected by the law. This is a clear violation of the worker's rights and the Labour Inspectorate in Rzeszow has initiated a proceeding against the management."

ZSP: How was the dismissal delivered to you?
"After I was informed about the intention to fire me and after I saw the September 5th letter asking the union to accept my dismissal, I felt very sick on psychosomatic grounds and I have spent a week being treated on the cardiology department. In the meantime, the management of Alima Gerber harassed my family several times. The saddest event occurred on September 13th, at 7 AM. Four of my children, aged from 7 to 13, were alone in the house, while my wife was working on a night shift. My children were woken up by the relentless bell ring. When my 12-year old son opened the door, the manager tried to give him the dismissal document.

My son did not want to accept anything from the manager. The manager demanded that an older son be called. But the older son refused to take anything and locked the door. The manager stood at the door until 9 AM, kept ringing and knocking the windows and door. The children were terrified and informed their parents by phone of what has happened. The youngest son kept crying and asking: "why do they want to put daddy in jail?"

After the manager left, the house was under observation until noon by a man in a red car, at about 50 m away from the house. Our neighbours informed us of this fact. After I left the hospital, I went to Bulgaria on September 16th, for a training organized by the European Trade Union Institute from Brussels. The training was earlier approved by the manager of the plant.

I was the only representative from Poland. At the Okecie airport in Warsaw, after luggage check-in, I saw the manager and the Human Resources director going after me. I was shocked to see them there. I ran to passport control and haven't seen them afterwards. After I returned from the training, I was not let into the plant. It was claimed that I was fired... at the airport!"

ZSP: How did the management portray this case to the employees? Were there any attempts to turn employees against you? If so, were those attempts successful?
"The management informed the employees that I am a criminal, because I have acted to the detriment of the company, allegedly advising the farmers to negotiate the highest possible prices for fruit. The management claimed that this was the reason for falling profits and that is why the employees cannot expect any significant raises. The workplace commission was also threatened that its members will have to participate in court hearings. Was this successful? I believe in some sense, yes."

ZSP: When will the trial begin?
"I have filed the case on September 25th in the Labour Court in Rzeszow. The first court hearing will take place on November 10th. I believe I will win, as I did 6 months earlier, when the employer illegally punished me for entering with a workplace security inspector on a night shift. I did nothing wrong. As a matter of fact, the inspector admitted that I acted in the interest of the plant by informing the president of the farmer's union that apples are being imported from Italy. No one can convince me that apples imported from Italy will be cheaper than the apples from near Rzeszow. Besides, the farmers are shareholders of the company. They are not competitors, but members of a family and the plant could not function without them."

ZSP: Dismissals of active union members are quite common in Poland. The political climate for union activity is quite bad. This year several union members have been dismissed in state owned and private companies. The employers seem to act with impunity. How to reverse this negative trend?
"We must highlight cases when the employers break the law. We need to show people the of meanness of some companies which knowingly break the law by firing protected union members. We also need to change the law in order to give real protection to the union activists who are on the front line of the struggle for workers rights. All unions must act together in this area."

ZSP: Temporary work is a common phenomenon. What kind of difficulties did you encounter while trying to fight for equal treatment of temporary workers employed by temp agencies and workers with permanent contracts?
"Our plant has been hiring temporary workers from the Impel agency for three years. These employees performed the exact same work as the permanent employees, for half the wages. They did not receive compensation for working in noisy conditions, their working clothes were not washed and they did not receive meals.

They were discriminated against, which is not allowed by the law on temporary work agencies. We have reported the issue to the management, but to no avail. Two years ago, we informed the Work Inspectorate about the case. The inspection revealed that our suspicions were right. The plant was forced to employ 70 of the temporary workers on permanent contracts, with the same wages as other Alima Gerber workers. A few of the workers filed suits against Impel for discrimination. Their lawyer estimated their losses to over 3300 Euro a year. The case is still pending."

ZSP: The international character of many corporations doing business in Poland allows for international actions of support in case workers rights are being broken. What are your experiences working with other organizations internationally?
"I have excellent experiences, especially with unions from the so-called "old" European Union. There seems to be quite a different union culture there. For example in 2006 I have written a complaint to the Swiss management about the extremely poor wages in our company. I have argued that an employee of our company cannot sustain himself, let alone his family on the wages he receives. We have received support from the European Confederation of Trade Unions in Brussels, from the IUF (International Union of Food workers) from Geneva, the European Worker’s Council and many unions in France, Spain, Italy and Switzerland. A journalist from Basler Zeitung has visited us to write a big feature about the case. Another newspaper, “Input” has written an article about the topic.The western media and organizations are the only real weapon of Polish unionists."

ZSP: Since you have lost your source of income, are you in need of material help? How can union members and people interested in worker's rights help you in your situation?
"I have not received wages since September 16th. I don’t receive any unemployment benefits, since I was fired on disciplinary grounds. Our family subsists on the income of my wife, who is a nurse. I have four children, who still are very much in shock after what happened to me. I have to return a credit from the Social Fund until October 15th. I am in the same situation as many ordinary workers in Alima Gerber, who can only afford some basic necessities despite years of hard work. I believe that the good will prevail. I ask people of good faith only for prayer."

ZSP: Thank you for the interview. We wish you success in your fight for reinstatement in the workplace!

Monday, September 08, 2008


INTERNATIONAL LABOUR:
INTERNATIONAL UNION COOPERATION VERSUS INTERNATIONAL BUSINESS:
The following post is from the IUF site, an international network of unions that hopes to build transnational solidarity in the face of the increasing globalization of corporations today. The subject matter is the increasing concentration in the international brewing industry (yes, beer is a subject dear to Molly's heart) and how workers in the industry will have to respond to this trend. The trend towards international cooperation amongst unions is undoubtedly laudable, and Molly says that it should be encouraged as much as possible---as long as the autonomy of the unions involved is respected and it doesn't become a reason to centralize unions rather than simply coordinate their actions. There is no need for such centralization, and the results would actually be quite detrimental. Coordination does not require central directing bodies, a point that has long been made by anarcho-syndicalists. But coordination is becoming even more important as business becomes even more transnational, as the following makes plain.
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Global Union Co-operation an Urgent Necessity as InBev/Anheuser-Busch Merger Creates World's Largest Brewer:
Merger creates the world's largest brewer
On 14 July, InBev acquired US-brewer Anheuser-Busch (A-B) for USD 52 billion (USD 70 per share). The deal created the world's largest brewer ahead of SABMiller and the recent Heineken/Carlsberg consortium that took over Scottish and Newcastle. The new company, to be called Anheuser-Busch InBev, will employ about 150,000 workers in more than 50 countries, controlling 31% of the world beer market with a combined turnover of USD 10.7 billion (EUR 7.8 billion). With the merger, InBev secures top performing brands in key markets, such as A-B's own flagship beer Budweiser, Mexican Grupo Modelo's Corona and China's second largest brewer Tsingtao.
North American unions concerned about possible cost cutting/ restructuring
In order to finance the acquisition, InBev has taken on a large amount of debt. Despite its announcement that it does not intend to close any of the 12 A-B breweries in North America, move or diminish the role of A-B's headquarters in St. Louis, Missouri, employees are concerned that the sale of A-B's theme park (Busch Gardens), packaging (SeaWorld) and other non-core businesses will not generate enough cash to offset the considerable liability. Shortly before the merger was approved, A-B had announced a workforce reduction of 10-15 percent (about 1,300 jobs) in an attempt to boost share price prior to closing the deal.
Teamsters rally at A-B St. Louis headquarters
The IUF-affiliated Teamsters union representing more than 7,000 A-B workers in the US and Canada is concerned about future restructuring measures and about InBev's continuation of A-B's commitment to quality health care and wages negotiated with the union. Key US employee concerns are the introduction of InBev's "zero-based budget", outsourcing, and the continuation of collective bargaining agreements and their negotiation process. The Teamsters collective agreements with A-B expire on 28 February, 2009. Negotiations started on August 18. Two days before, on August 16, Teamsters rallied in St. Louis to demand that InBev continue the relation with the union, honour existing agreements and keep its commitments to A-B workers, retirees and communities.
Reaching out to InBev workers worldwide
The Teamsters invited union leaders from InBev operations in Brazil, Belgium and Canada to a special meeting in St. Louis with Teamster local leaders at A-B to talk about their experiences with InBev management. InBev's focus on individual productivity is very strong in Brazil, where workers can be penalised for underperformance. In Canada two breweries were closed in Toronto and Vancouver since InBev's takeover of Labatt's, while Canadian workers have seen an erosion in their pension schemes. Belgian unions reported on the deterioration of union/management relations after a change in management following the Interbrew/AmBev merger, on historic brewery closures and consolidation and on the company's introduction of more outsourcing, flexible, part-time and temporary employment.
IUF and affiliates must take the lead in building union power!
The increased consolidation in the beer industry and the newly created beer giant A-B InBev highlight the urgent need for international union co-ordination and concrete solidarity among its employees and their unions everywhere in the world. This is a strategic priority for the IUF that will be tackled in the next IUF global brewery workers' meeting planned for 2009 with the creation of a Global A-B InBev Union Alliance.

Monday, May 19, 2008



GLOBALIZATION:

HOW TO MANUFACTURE A GLOBAL FOOD CRISIS:

The following article was recently published in the June 2, 2008 edition of The Nation, a US leftist magazine under the title of 'Blame the Bankers". It has been posted on the Autonomy and Solidarity site in Ontario, from which Molly takes this version and title.

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HOW TO MANUFACTURE A GLOBAL FOOD CRISIS

Lessons from the World Bank, IMF, and WTO

How "free trade" is destroying Third World agriculture-and who's fighting back May 18, 2008 By Walden Bello, Source: The Nation




The global rise in food prices is not only a consequence of using food crops to produce biofuels, but of the "free trade" policies promoted by international financial institutions. Now peasant organisations are leading the opposition to a capitalist industrial agriculture.




When tens of thousands of people staged demonstrations in Mexico last year to protest a 60 percent increase in the price of tortillas, many analysts pointed to biofuel as the culprit. Because of US government subsidies, American farmers were devoting more and more acreage to corn for ethanol than for food, which sparked a steep rise in corn prices. The diversion of corn from tortillas to biofuel was certainly one cause of skyrocketing prices, though speculation on biofuel demand by transnational middlemen may have played a bigger role. However, an intriguing question escaped many observers: how on earth did Mexicans, who live in the land where corn was domesticated, become dependent on US imports in the first place?
Eroding Mexican Agriculture
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 (IMF), the World Bank and Washington. The process began with the early 1980s debt crisis. One of the two largest developing-country debtors, Mexico was forced to beg for money from the Bank and IMF to service its debt to international commercial banks. The quid pro quo for a multibillion-dollar bailout was what a member of the World Bank executive board described as "unprecedented thoroughgoing interventionism" designed to eliminate high tariffs, state regulations and government support institutions, which neoliberal doctrine identified as barriers to economic efficiency.




Interest payments rose from 19 percent of total government expenditures in 1982 to 57 percent in 1988, while capital expenditures dropped from an already low 19.3 percent to 4.4 percent. The contraction of government spending translated into the dismantling of state credit, government-subsidized agricultural inputs, price supports, state marketing boards and extension services. Unilateral liberalization of agricultural trade pushed by the IMF and World Bank also contributed to the destabilization of peasant producers.




This blow to peasant agriculture was followed by an even larger one in 1994, when the North American Free Trade Agreement went into effect. Although NAFTA had a fifteen-year phaseout of tariff protection for agricultural products, including corn, highly subsidized US corn quickly flooded in, reducing prices by half and plunging the corn sector into chronic crisis. Largely as a result of this agreement, Mexico's status as a net food importer has now been firmly established.




With the shutting down of the state marketing agency for corn, distribution of US corn imports and Mexican grain has come to be monopolized by a few transnational traders, like US-owned Cargill and partly US-owned Maseca, operating on both sides of the border. This has given them tremendous power to speculate on trade trends, so that movements in biofuel demand can be manipulated and magnified many times over. At the same time, monopoly control of domestic trade has ensured that a rise in international corn prices does not translate into significantly higher prices paid to small producers.




It has become increasingly difficult for Mexican corn farmers to avoid the fate of many of their fellow corn cultivators and other smallholders in sectors such as rice, beef, poultry and pork, who have gone under because of the advantages conferred by NAFTA on subsidized US producers. According to a 2003 Carnegie Endowment report, imports of US agricultural products threw at least 1.3 million farmers out of work--many of whom have since found their way to the United States.




Prospects are not good, since the Mexican government continues to be controlled by neoliberals who are systematically dismantling the peasant support system, a key legacy of the Mexican Revolution. As Food First executive director Eric Holt-Gimenez sees it, "It will take time and effort to recover smallholder capacity, and there does not appear to be any political will for this--to say nothing of the fact that NAFTA would have to be renegotiated."
Creating a Rice Crisis in the Philippines
That the global food crisis stems mainly from free-market restructuring of agriculture is clearer in the case of rice. Unlike corn, less than 10 percent of world rice production is traded. Moreover, there has been no diversion of rice from food consumption to biofuels. Yet this year alone, prices nearly tripled, from $380 a ton in January to more than $1,000 in April. Undoubtedly the inflation stems partly from speculation by wholesaler cartels at a time of tightening supplies. However, as with Mexico and corn, the big puzzle is why a number of formerly self-sufficient rice-consuming countries have become severely dependent on imports.




The Philippines provides a grim example of how neoliberal economic restructuring transforms a country from a net food exporter to a net food importer. The Philippines is the world's largest importer of rice. Manila's desperate effort to secure supplies at any price has become front-page news, and pictures of soldiers providing security for rice distribution in poor communities have become emblematic of the global crisis.




The broad contours of the Philippines story are similar to those of Mexico. Dictator Ferdinand Marcos was guilty of many crimes and misdeeds, including failure to follow through on land reform, but one thing he cannot be accused of is starving the agricultural sector of government funds. To head off peasant discontent, the regime provided farmers with subsidized fertilizer and seeds, launched credit schemes, and built rural infrastructure. During the 14 years of the dictatorship, it was only during one year, 1973, that rice had to be imported owing to widespread damage wrought by typhoons. When Marcos fled the country in 1986, there were reported to be 900,000 metric tons of rice in government warehouses.




Paradoxically, the next few years under the new democratic dispensation saw the gutting of government investment capacity. As in Mexico the World Bank and IMF, working on behalf of international creditors, pressured the Corazon Aquino administration to make repayment of the $26 billion foreign debt a priority. Aquino acquiesced, though she was warned by the country's top economists that the "search for a recovery program that is consistent with a debt repayment schedule determined by our creditors is a futile one."




Between 1986 and 1993 8 percent to 10 percent of GDP left the Philippines yearly in debt-service payments--roughly the same proportion as in Mexico. Interest payments as a percentage of expenditures rose from 7 percent in 1980 to 28 percent in 1994;capital expenditures plunged from 26 percent to 16 percent. In short, debt servicing became the national budgetary priority.




Spending on agriculture fell by more than half. The World Bank and its local acolytes were not worried, however, since one purpose of the belt-tightening was to get the private sector to energize the countryside. But agricultural capacity quickly eroded. Irrigation stagnated, and by the end of the 1990s only 17 percent of the Philippines' road network was paved, compared with 82 percent in Thailand and 75 percent in Malaysia. Crop yields were generally anemic, with the average rice yield in rice of 2.8 metric tons per hectare way below those in China, Vietnam and Thailand, where governments actively promoted rural production. The post-Marcos agrarian reform program shriveled, deprived of funding for support services, which had been the key to successful reforms in Taiwan and South Korea.




As in Mexico Filipino peasants were confronted with full-scale retreat of the state as provider of comprehensive support-a role they had come to depend on.




And the cutback in agricultural programs was followed by trade liberalization, with the Philippines' 1995 entry into the World Trade Organization having the same effect as Mexico's joining NAFTA. WTO membership required the Philippines to eliminate quotas on all agricultural imports except rice and allow a certain amount of each commodity to enter at low tariff rates. While the country was allowed to maintain a quota on rice imports, it nevertheless had to admit the equivalent of 1 to 4 percent of domestic consumption over the next ten years.



In fact, because of gravely weakened production resulting from lack of state support, the government imported much more than that to make up for possible shortfalls. These imports, which rose from 263,000 metric tons in 1995 to 2.1 million tons in 1998, depressed the price of rice, discouraging farmers and keeping growth in production at a rate far below that of the country's two top suppliers, Thailand and Vietnam.




The consequences of the Philippines' joining the WTO barreled through the rest of its agriculture like a super-typhoon. Swamped by cheap corn imports--much of it subsidized US grain--farmers reduced land devoted to corn from 3.1 million hectares in 1993 to 2.5 million in 2000. Massive importation of chicken parts nearly killed that industry, while surges in imports destabilized the poultry, hog and vegetable industries.




During the 1994 campaign to ratify WTO membership, government economists, coached by their World Bank handlers, promised that losses in corn and other traditional crops would be more than compensated for by the new export industry of "high-value-added" crops like cut flowers, asparagus and broccoli. Little of this materialized. Nor did many of the 500,000 agricultural jobs that were supposed to be created yearly by the magic of the market; instead, agricultural employment dropped from 11.2 million in 1994 to 10.8 million in 2001.




The one-two punch of IMF-imposed adjustment and WTO-imposed trade liberalization swiftly transformed a largely self-sufficient agricultural economy into an import-dependent one as it steadily marginalized farmers. It was a wrenching process, the pain of which was captured by a Filipino government negotiator during a WTO session in Geneva. "Our small producers," he said, "are being slaughtered by the gross unfairness of the international trading environment."
The Great Transformation
The experience of Mexico and the Philippines was paralleled in one country after another subjected to the ministrations of the IMF and the WTO. A study of fourteen countries by the UN's Food and Agricultural Organization found that the levels of food imports in 1995-98 exceeded those in 1990-94. This was not surprising, since one of the main goals of the WTO's Agreement on Agriculture was to open up markets in developing countries so they could absorb surplus production in the North. As then-US Agriculture Secretary John Block put it in 1986, "The idea that developing countries should feed themselves is an anachronism from a bygone era. They could better ensure their food security by relying on US agricultural products, which are available in most cases at lower cost."




What Block did not say was that the lower cost of US products stemmed from subsidies, which became more massive with each passing year despite the fact that the WTO was supposed to phase them out. From $367 billion in 1995, the total amount of agricultural subsidies provided by developed-country governments rose to $388 billion in 2004. Since the late 1990s subsidies have accounted for 40 percent of the value of agricultural production in the European Union and 25 percent in the United States.




The apostles of the free market and the defenders of dumping may seem to be at different ends of the spectrum, but the policies they advocate are bringing about the same result: a globalized capitalist industrial agriculture. Developing countries are being integrated into a system where export-oriented production of meat and grain is dominated by large industrial farms like those run by the Thai multinational CP and where technology is continually upgraded by advances in genetic engineering from firms like Monsanto. And the elimination of tariff and non-tariff barriers is facilitating a global agricultural supermarket of elite and middle-class consumers serviced by grain-trading corporations like Cargill and Archer Daniels Midland and transnational food retailers like the British-owned Tesco and the French-owned Carrefour.




There is little room for the hundreds of millions of rural and urban poor in this integrated global market. They are confined to giant suburban favelas, where they contend with food prices that are often much higher than the supermarket prices, or to rural reservations, where they are trapped in marginal agricultural activities and increasingly vulnerable to hunger. Indeed, within the same country, famine in the marginalized sector sometimes coexists with prosperity in the globalized sector.




This is not simply the erosion of national food self-sufficiency or food security but what Africanist Deborah Bryce-son of Oxford calls "de-peasantization"-the phasing out of a mode of production to make the countryside a more congenial site for intensive capital accumulation. This transformation is a traumatic one for hundreds of millions of people, since peasant production is not simply an economic activity. It is an ancient way of life, a culture, which is one reason displaced or marginalized peasants in India have taken to committing suicide. In the state of Andhra Pradesh, farmer suicides rose from 233 in 1998 to 2,600 in 2002; in Maharashtra, suicides more than tripled, from 1,083 in 1995 to 3,926 in 2005. One estimate is that some 150,000 Indian farmers have taken their lives. Collapse of prices from trade liberalization and loss of control over seeds to biotech firms is part of a comprehensive problem, says global justice activist Vandana Shiva: "Under globalization, the farmer is losing her/his social, cultural, economic identity as a producer. A farmer is now a ‘consumer' of costly seeds and costly chemicals sold by powerful global corporations through powerful landlords and money lenders locally."
African Agriculture: From Compliance to Defiance
De-peasantization is at an advanced state in Latin America and Asia. And if the World Bank has its way, Africa will travel in the same direction. As Bryceson and her colleagues correctly point out in a recent article, the World Development Report for 2008, which touches extensively on agriculture in Africa, is practically a blueprint for the transformation of the continent's peasant-based agriculture into large-scale commercial farming. However, as in many other places today, the Bank's wards are moving from sullen resentment to outright defiance.




At the time of decolonization, in the 1960s, Africa was actually a net food exporter. Today the continent imports 25 percent of its food; almost every country is a net importer. Hunger and famine have become recurrent phenomena, with the past three years alone seeing food emergencies break out in the Horn of Africa, the Sahel, and Southern and Central Africa.




Agriculture in Africa is in deep crisis, and the causes range from wars to bad governance, lack of agricultural technology and the spread of HIV/AIDS. However, as in Mexico and the Philippines, an important part of the explanation is the phasing out of government controls and support mechanisms under the IMF and World Bank structural adjustment programs imposed as the price for assistance in servicing external debt.




Structural adjustment brought about declining investment, increased unemployment, reduced social spending, reduced consumption and low output. Lifting price controls on fertilizers while simultaneously cutting back on agricultural credit systems simply led to reduced fertilizer use, lower yields and lower investment. Moreover, reality refused to conform to the doctrinal expectation that withdrawal of the state would pave the way for the market to dynamize agriculture.




Instead, the private sector, which correctly saw reduced state expenditures as creating more risk, failed to step into the breach. In country after country, the departure of the state "crowded out" rather than "crowded in" private investment. Where private traders did replace the state, noted an Oxfam report, "they have sometimes done so on highly unfavorable terms for poor farmers," leaving "farmers more food insecure, and governments reliant on unpredictable international aid flows." The usually pro-private sector Economist agreed, admitting that "many of the private firms brought in to replace state researchers turned out to be rent-seeking monopolists."




The support that African governments were allowed to muster was channeled by the World Bank toward export agriculture to generate foreign exchange, which states needed to service debt. But, as in Ethiopia during the 1980s famine, this led to the dedication of good land to export crops, with food crops forced into less suitable soil, thus exacerbating food insecurity. Moreover, the World Bank's encouragement of several economies to focus on the same export crops often led to overproduction, triggering price collapses in international markets. For instance, the very success of Ghana's expansion of cocoa production triggered a 48 percent drop in the international price between 1986 and 1989. In 2002-03 a collapse in coffee prices contributed to another food emergency in Ethiopia.




As in Mexico and the Philippines, structural adjustment in Africa was not simply about underinvestment but state divestment. But there was one major difference. In Africa the World Bank and IMF micromanaged, making decisions on how fast subsidies should be phased out, how many civil servants had to be fired and even, as in the case of Malawi, how much of the country's grain reserve should be sold and to whom. In other words, Bank and IMF resident proconsuls reached to the very innards of the state's involvement in the agricultural economy to rip it up.




Compounding the negative impact of adjustment were unfair EU and US trade practices. Liberalization allowed subsidized EU beef to drive many West African and South African cattle raisers to ruin. With their subsidies legitimized by the WTO, US growers offloaded cotton on world markets at 20 per-cent to 55 percent of production cost, thereby bankrupting West and Central African farmers.




According to Oxfam, the number of sub-Saharan Africans living on less than a dollar a day almost doubled, to 313 million, between 1981 and 2001-46 percent of the whole continent. The role of structural adjustment in creating poverty was hard to deny. As the World Bank's chief economist for Africa admitted, "We did not think that the human costs of these programs could be so great, and the economic gains would be so slow in coming."




Malawi is representative of the African tragedy spawned by the IMF and the World Bank. In 1999 the government of Malawi initiated a program to give each smallholder family a starter pack of free fertilizers and seeds. The result was a national surplus of corn. What came after is a story that should be enshrined as a classic case study of one of the greatest blunders of neoliberal economics.




The World Bank and other aid donors forced the scaling down and eventual scrapping of the program, arguing that the subsidy distorted trade. Without the free packs, output plummeted. In the meantime, the IMF insisted that the government sell off a large portion of its grain reserves to enable the food reserve agency to settle its commercial debts. The government complied. When the food crisis turned into a famine in 2001-02, there were hardly any reserves left. About 1,500 people perished. The IMF was unrepentant; in fact, it suspended its disbursements on an adjustment program on the grounds that "the parastatal sector will continue to pose risks to the successful implementation of the 2002/03 budget. Government interventions in the food and other agricultural markets...[are] crowding out more productive spending."




By the time an even worse food crisis developed in 2005, the government had had enough of World Bank/IMF stupidity. A new president reintroduced the fertilizer subsidy, enabling 2 million households to buy it at a third of the retail price and seeds at a discount. The result: bumper harvests for two years, a million-ton maize surplus and the country transformed into a supplier of corn to Southern Africa.




Malawi's defiance of the World Bank would probably have been an act of heroic but futile resistance a decade ago. The environment is different today, since structural adjustment has been discredited throughout Africa. Even some donor governments and NGOs that used to subscribe to it have distanced themselves from the Bank. Perhaps the motivation is to prevent their influence in the continent from being further eroded by association with a failed approach and unpopular institutions when Chinese aid is emerging as an alternative to World Bank, IMF and Western government aid programs.
Food Sovereignty: An Alternative Paradigm?
It is not only defiance from governments like Malawi and dissent from their erstwhile allies that are undermining the IMF and the World Bank. Peasant organizations around the world have become increasingly militant in their resistance to the globalization of industrial agriculture. Indeed, it is because of pressure from farmers' groups that the governments of the South have refused to grant wider access to their agricultural markets and demanded a massive slashing of US and EU agricultural subsidies, which brought the WTO's Doha Round of negotiations to a standstill.




Farmers' groups have networked internationally; one of the most dynamic to emerge is Via Campesina (Peasant's Path). Via not only seeks to get "WTO out of agriculture" and opposes the paradigm of a globalized capitalist industrial agriculture; it also proposes an alternative-food sovereignty. Food sovereignty means, first of all, the right of a country to determine its production and consumption of food and the exemption of agriculture from global trade regimes like that of the WTO. It also means consolidation of a smallholder-centered agriculture via protection of the domestic market from low-priced imports; remunerative prices for farmers and fisherfolk; abolition of all direct and indirect export subsidies; and the phasing out of domestic subsidies that promote unsustainable agriculture. Via's platform also calls for an end to the Trade Related Intellectual Property Rights regime, or TRIPs, which allows corporations to patent plant seeds; opposes agro-technology based on genetic engineering; and demands land reform. In contrast to an integrated global monoculture, Via offers the vision of an international agricultural economy composed of diverse national agricultural economies trading with one another but focused primarily on domestic production.




Once regarded as relics of the pre-industrial era, peasants are now leading the opposition to a capitalist industrial agriculture that would consign them to the dustbin of history. They have become what Karl Marx described as a politically conscious "class for itself,"contradicting his predictions about their demise. With the global food crisis, they are moving to center stage-and they have allies and supporters. For as peasants refuse to go gently into that good night and fight de-peasantization, developments in the twenty-first century are revealing the panacea of globalized capitalist industrial agriculture to be a nightmare. With environmental crises multiplying, the social dysfunctions of urban-industrial life piling up and industrialized agriculture creating greater food insecurity, the farmers' movement increasingly has relevance not only to peasants but to everyone threatened by the catastrophic consequences of global capital's vision for organizing production, community and life itself.
(This article appears in the June 2, 2008, edition of The Nation)
Walden Bello, a fellow of the Transnational Institute, is professor of sociology at the University of the Philippines, president of the Freedom from Debt Coalition and senior analyst at Focus on the Global South.