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Fair Trade Advocates Blast CAFTA; The Rights of Rural Americans; Other news

(Thursday, March 31, 2005 -- CropChoice news) --

1. Contract growers hoping the chicken industry offers a steady nest egg may instead be trapped by debt
2. Opposition to the Central American Free Trade Agreement Grows
3. Dissent At Baylor: Fair Trade Advocates Blast President’s CAFTA
4. Now Bush is Picking on Kids
5. The Rights of Rural Americans
6. Bhagwati, Globalisation and hunger
7. New Crop: Windmills and Organic Beef

1. Contract growers hoping the chicken industry offers a steady nest egg may instead be trapped by debt

By Barry Shlachter, Star-Telegram Staff Writer

CAMERON - In 1999, a former high school physics teacher named Susan Martin became one of the country's 30,000 contract growers responsible for the vast majority of the chicken we eat.

She dreamed of succeeding in agribusiness, working with Sanderson Farms, a large Mississippi poultry processor with more than $1 billion in annual sales.

But two years later, Martin was losing money and carrying $460,000 in farm debt. Worse, Martin discovered that under the terms of her contract, she couldn't sue Sanderson, which she accused of misleading her. Nor could she afford the $23,000 cost of binding arbitration as required by the contract to resolve disputes. The American Arbitration Association's Dallas office rejected Martin's request to have the fees waived.

"It was hell," said Martin, 52, whose husband is a manager in an office furniture factory. She lost her farm near Cameron, south of Temple, and about $100,000 in equity. "The worst thing was being treated like a dog."

Mike Cockrell, Sanderson's chief financial officer, denied that the company has misled its 150 contract growers in Texas to whom, he said, it offers some of the most progressive contracts in the industry.

But poultry companies like Sanderson, Tyson and Pilgrim's Pride have increasingly come under criticism for their half-century-old system of contract growing, through which about 90 percent of U.S. chickens are now produced.

Under contract growing, which has helped keep the supermarket price of chicken low, the poultry companies own the flocks and supply the feed. Growers, who get a guaranteed price per pound, provide the labor, chicken houses, water, electricity and gas.

But many small farmers, who commonly borrow $700,000 or more to build chicken houses and subsequently must invest more to keep up with new technology and competing growers, find themselves deep in hock and unable to make a profit.

Critics like Wes Sims, president of the Waco-based Texas Farmers Union, say that predictions of growers' earnings are overstated, that they risk being cut off from fresh flocks for refusing costly upgrades demanded by companies, and that their heavy farm debt ensures that they renew unfair contracts, creating a system akin to modern-day serfdom.

Poultry companies counter by saying contracts are a boon to farmers, who are insulated from fluctuating market conditions by a set price, a guarantee that is also used in some hog production. And if the system is so flawed, they ask, why are there waiting lists of prospective growers eager to sign contracts?

"The best proof that the contract-growing system works is that people get in it, stay in many years and even apply to the company to build another chicken house," says Dick Lobb, spokesman for the National Chicken Council, an industry group in Washington.

One East Texas grower, who describes himself as "pro-Pilgrim's Pride," said reinvestment is a given in almost any business, including poultry.

"It's like factory equipment or a car," said the farmer, who asked not to be identified and would be interviewed only in his pickup driven out of sight from a public road for fear of retaliation. "After so many years, you need to replace it. Things change. You have to go with the flow."


Beginning in the 1950s, contract growing revolutionized the way chickens are raised and sold throughout the United States. No longer do growers buy and raise chicks, then sell mature broilers to one of several competing processors with a handshake.

Under the current system, "integrator" companies such as Sanderson, Tyson and Pilgrim's Pride outsource the rearing of poultry to family farmers who are told how the poultry should be raised every step of the way.

Some poultry producers offer one- or three-year contracts; others can be from batch to batch, the industry standard up until the late 1990s. Sanderson has had a unique 15-year term since 1997.

Contracts deliver clear benefits to the family farmer, says Ray Atkinson, a Pilgrim's Pride spokesman.

No longer do they assume market risk and have to locate a buyer when their flocks are ready for sale. This allows them to earn a steady income on relatively little acreage, he said.

Easy trouble

But many growers get into trouble quickly, even though they're protected against falling prices.

Aside from wanting to retain family land, many farmers sign poultry contracts because they are confident of being above-average growers and therefore earning more, said Robert Taylor, an Auburn University agricultural economist.

But as other farmers upgrade with better technology or build more efficient chicken houses, those with older facilities will usually fall below average, he said.

All poultry companies pay farmers a price per pound, which is raised or lowered by how the grower ranks among others on the basis of feed converted to weight gain. A half-cent per pound can make the difference between profit and loss.

Called the ranking, or tournament system, farmers found on the bottom rung during three or more flock growing periods may be pressured to improve productivity by upgrading facilities, or poultry companies can drop them.

"Some call it the gladiator system, because you are trying to kill your competitor, your own neighbor," said Laura Klauke of the Rural Advancement Foundation International-USA, a North Carolina-based advocacy group working for passage of legislation to improve contracts.

Individual growers can end up being "serfs with a mortgage," Auburn's Taylor said.

"By the time they get the $700,000 loan for chicken houses paid off, the companies ask them to make expensive upgrades," he said. "They get caught up in a debt trap. The grower has to take whatever he is offered, especially after he's been 'captured' -- deeply indebted."

And over the past half-century, the poultry industry has become highly consolidated, meaning that few growers have an alternative should there be a falling out with their processor.

This leads to many farmers feeling trapped, said Ann Stanaland, who grew chickens with her husband near Nacogdoches. Even if they opt to sell, none can recoup their investment if there's no current contract to go with the farm. Without a contract, the value of the property often collapses.

Even if multiple poultry companies already operate in the same area, there's little incentive to pick up a rival's farmer.

"Why sign a farmer with 5-year-old houses when there's a waiting list of people willing to build brand new ones?" said a former Pilgrim's Pride field representative who declined to be named because of fear of retaliation against relatives who are growers.

Of 14 farmers interviewed for this article, only two current growers agreed to be identified by name.

Royce Johnson of Center has raised chickens since before contract growing was introduced more than four decades ago and has watched the system evolve.

"They call us 'contract growers,' " Johnson said. "But they tell us everything we do. If there's just a personality conflict with your company service tech, you can lose your contract over that. You can talk to another company, but Tyson wouldn't sign another farmer that Pilgrim's cut off."

Taylor, the Auburn economist, questions some of the criticism of the big companies.

"I doubt that their motivation is to keep the growers in bondage," Taylor said. "If new technology comes along that's better for them, they get the grower to adopt it even though it may not be better for the grower's bottom line."

The company-grower relationship, Taylor said, "is very one-sided. For a market to work, you need a balance of power."

Stanaland said Pilgrim's Pride "put a gun to our heads," forcing them to accept a new contract by refusing to deliver chicks. Without a new batch, it would be impossible to repay the farm loan.

Pilgrim's Atkinson, however, said the company has signed statements by Texas growers who acknowledge that it does not retaliate against disgruntled farmers.

Leaps of faith

To be sure, many of the stories following chicken growers' paths into the industry reflect leaps of faith.

A.T. Terry, a Texas-born broiler grower in Lynchburg, Tenn., who studied agricultural economics at Texas A&M University, said he borrowed $384,000 to buy five chicken houses three years ago so his family could experience a rural lifestyle.

But Terry said he was cut off by Tyson last month after demanding to watch his birds being weighed at a company facility. The investment is now worthless without a contract, he said.

Tyson, asked for comment, did not refer to Terry's case specifically but said all its growers are allowed to watch the weighing under federal law.

And Chris Burger was a Florida state trooper who raised chickens as a sideline, as many contract growers do.

After years of good relations with a large poultry company, Cagle's Inc. of Atlanta, troubles began when Burger joined a growers' association to better present common grievances.

Burger is one of very few to overcome a binding arbitration clause and prevail in court in what is considered a landmark case.

But he says his $700,000 award in 2001 went to cover farm debts. He says the five-year court battle cost him his marriage, his home and two farms. At one point, he was reduced to sleeping in his car and showering at the state police barracks.

Contract disputes

Some growers complain that the poultry companies mislead the growers from the start.

Houston lawyer Mel Smith said Susan Martin, the Cameron farmer, and other family farmers he tried to represent were shown a Sanderson contract before borrowing money to build chicken houses.

But on the eve of the first flock's delivery, a lengthier contract was presented to the now-heavily indebted farmers, who had little choice but to sign, Smith said.

Cockrell said the breeder contracts in Texas were changed only to "correspond to growers' concerns." Moreover, they were sent to farmers several weeks in advance for review by growers and their attorneys, he added.

Martin said she never received such a preview contract. Another former grower, Roy White of Sharp, said he, too, hadn't seen the final contract until shortly before a flock was to be delivered.

Tensions between poultry producers and growers were spotlighted four years ago when one disgruntled East Texas farmer took matters into his own hands.

On Jan. 8, 2001, Barry Townsend broke into Sanderson's Bryan plant, fatally shot a company official, wounded another and then took his own life.

Townsend's troubles started before the incident.

He was on probation for assaulting a stepdaughter and had been questioned by police after a woman -- a possible acquaintance -- was run over and killed in a parking lot a week earlier.

Townsend's widow told police that the couple were earning half the money they expected from Sanderson and that flock deliveries were erratic.

Before firing the first shots, Townsend ordered his two victims to call his wife and apologize.

In an interview with police, Lucinda Townsend explained her husband's demand by saying, "I feel like we're being lied to all the time" by Sanderson Farms.

But Barney Allen, one of 150 Sanderson contract growers in Texas, blames the Townsends' problems on their inability to run a business.

"Some people get in over their head," said Allen, 70, who has been a farmer and rancher for more than four decades, including eight years as a Sanderson contract producer.

"There are people who work for Sanderson I don't like," he said. "But overall, the company is the best thing that ever happened to our county."

Allen, who lives in Robertson County in East Texas, says that his four pullet houses earn him "a little less than $10,000 a month" and that he saves thousands more by substituting chicken litter for manufactured fertilizer for his cattle pastures.

Looking to the law

Texas, unlike Iowa, Kansas, Illinois and Georgia, has no specific law protecting contract farmers from unfair practices by poultry integrators. And farmers like Martin who have tried to organize growers' associations in Texas say company pressure brought such efforts to an end after one or two meetings.

"The [poultry companies] pretty much control you, and if you complain, they can cut you off," said Larry Owens, an Agriculture Department official who sees both good and bad in contract growing.

Cost and contractual obstacles have served to curb legal remedies. But three East Texas farmers are suing Pilgrim's Pride in a Texarkana federal court, alleging they were unfairly pressured to accept what they considered unfavorable new contracts before their old ones expired.

Two ended up signing because they needed new flocks to cover large loan payments on their chicken houses. The third, Don Davis, was able to refuse because his debt was smaller, but he said a promised flock was not delivered by Pilgrim's. A trial date is expected to be announced April 4.

Pilgrim's Pride has denied any wrongdoing and noted that the plaintiffs are just three of the 2,000 Pilgrim's Pride growers in Texas. "Relations are generally strong," the company said.

Even in states such as Alabama and North Carolina, where growers' associations have been formed, growers lack the clout to pass legislation, said Taylor, the Auburn economist.

But last year Georgia and Illinois followed Kansas in passing legislation that gave growers the right to have their contracts reviewed by their own attorneys and see statistical data used to determine compensation.

After failing the first time around in Tyson's backyard, a similar growers' rights bill was passed by the Arkansas Legislature and now awaits the governor's signature. Aside from making arbitration voluntary, it says farmers cannot be prohibited from comparing contract terms or discussing common problems.

Still, competition among growers has hindered alliances.

"It's made us independent, so we can't get together," said Johnson, the East Texas farmer. "If only half of the growers would get together, we'd solve this problem easily."

Bottom line

Perhaps one surprise is that relatively few growers default.

Taking the bankruptcy route is not an option among small-town farmers in East Texas "if you want to maintain your pride and good family name," says Stanaland, the former Nacogdoches grower.

But the bottom-line figures are worrisome, economists say.

A 2003 analysis by Dan Cunningham -- a University of Georgia agricultural economist -- estimated that cash flow, adjusted for inflation, for an average broiler grower dropped to $5,965 in 2003 from $12,065 in 1993.

Taylor, the Auburn economist, says a poultry company can earn a 15 percent to 30 percent return on its investment, while a contract grower would be better off taking a $6.50-an-hour job and putting the amount of his down payment in a low-interest-paying CD.

Lobb, the National Chicken Council spokesman, questioned that, noting that Taylor factored in a labor cost for the owner-farmer and family members, even when no money changed hands.

But at least one company, Sanderson Farms, cites an annual $5,000 labor cost in recruitment material for family farmers.

"While it may not be the most lucrative form of agricultural production, it is among the steadiest," Lobb said. "Both sides need the contract system."

2. Opposition to the Central American Free Trade Agreement Grows

March 29, 2005

Contact: Emily Eisenberg, National Farmers Union
202-314-3104, eeisenberg@nfudc.org

WASHINGTON (March 29, 2005) - Despite support by President Bush's administration, opposition to the Central America Free Trade Agreement (CAFTA) continues to swell within America's agriculture community. Several key Congressional leaders and state Agriculture Commissioners have come out against the trade agreement, which they believe is a poor deal for the American farmer.

Last week Sen. Saxby Chambliss (R-Ga.), Chairman of the Senate Agriculture Committee, joined the growing chorus of CAFTA opposition. "I am very concerned about the Central America Free Trade Agreement," Chambliss said.

"As it currently stands I will vote against the agreement when it comes to the Floor." Senator Chambliss joins many champions of American agriculture in Congress on both sides of the aisle in opposing CAFTA, including House Agriculture Committee Ranking Member Collin Peterson (D-MN), Representative Earl Pomeroy (D-N.D.) and Representative Dennis Rehberg (R-MT).

In addition, Agriculture Commissioners from several key agriculture states, including Alabama, Delaware, Florida, Louisiana and North Dakota, have also spoken out against CAFTA. Last month the National Association of State Departments of Agriculture (NASDA) adopted a resolution to reject CAFTA.

"CAFTA, like the failed trade policies of the past, is being sold on wildly optimistic projections that sound good but never seem to materialize," National Farmers Union President Dave Frederickson said. "The fact is that the United States continues to come up on the short-end in trade agreements."

"There is no better example that our trade policy isn't working than the fact for the first time in nearly a half-century the United States will import more agriculture products than we export," Frederickson said.



3. Dissent At Baylor: Fair Trade Advocates Blast President’s CAFTA

By Nathan Diebenow, The Lone Star Iconoclast

CRAWFORD — Fair trade would be a better way to treat other countries than free trade, said farm and labor advocates in Texas last Wednesday at the Crawford Peace House. The six panelists urged Congress to not ratify President George W. Bush’s proposed Central American Free Trade Agreement because of its negative impacts on the environment, workers, farmers, prices, immigration, and democracy. Prior to the panel, President Bush met with Canadian Prime Minister Paul Martin and Mexican President Vicente Fox for two hours on the Baylor University campus to discuss trade and security measures. "Clearly, (the trilateral talk between Mexico, Canada, and the U.S.) is a symbolic meeting not to solve concrete social and economic problems caused by actual trade agreements but rather to reinvigorate the public’s now faltering commitment to myth that free trade is the answer to all our problems," said Lesley Ramsey, Director of Texas Fair Trade Coalition. "There was so much dialogue to be had. They can’t possibly touch the top of the iceberg," said Becky Moeller, Texas AFL-CIO Secretary/Treasurer. Indeed, it was reported that the three heads of state agreed only to pledge to help each other in the future and failed to address the problems over trade, immigration, defense, and even the war in Iraq. And President Bush has yet to drum up major support for CAFTA in the halls of Congress. According to the panelists at the Peace House, CAFTA is an extension of NAFTA as it adds six more countries in the Western Hemisphere to the free trade policies imposed by the United States.

The ultimate goal of the free trade is to insure increased profits to U.S.-based multinational corporations.

"They don’t look further ahead than 90 days, you know. After all, they are not human beings. They don’t have a mind or spirit," said Wes Sims, Texas Farmers Union President. "They just think about profit. That’s all they care about."

"If we continue, we’ll continue the race to the bottom. In the United States of America, we’ll become a Third World Nation. We’re moving there very dramatically," said Sims. "This decline of the dollar is just the beginning."

Free Trade Hurts Jobs

The panel of advocates agreed that CAFTA would, like NAFTA, fail to produce its promised effects — new jobs, new markets for exports, improved standards of living for all parties of the agreement, and reduced illegal immigration from Mexico to the U.S.

NAFTA, since its ratification under the Clinton Administration 11 years ago, has in fact produced the opposite effects.

Ramsey said that due to NAFTA, one in six manufacturing jobs has been lost in the United States. Moeller of the Texas AFL-CIO estimated that 900,000 jobs were lost in the U.S. because of NAFTA’s policies.

"The state of Texas has suffered one of the highest rates of NAFTA attributable job loss in the nation," Ramsey said. "In Texas alone, more than 50,000 manufacturing jobs have been lost. So many more people lost their jobs due to NAFTA that the Texas Workforce Commission ran out of money last year to fund that program to train those workers."

Sims stated that now the effect of NAFTA has stretched to the high tech jobs being sent out of the United States. "We have 200,000 engineers — college graduates — are unemployed in their field today because those jobs are no longer available here," he said.

Ramsey noted that Latino workers have been disproportionately impacted by trade-related job loss in Texas. Whereas Latinos represent 20 percent of the Texas workforce, they are disproportionately represented in the second hardest hit by trade related job loss in Texas, especially textiles and electronics assembling. Nationally, Latinos have borne 47 percent of NAFTA-related job loss, she said.

"Free and independent unions are fought by the governments in the countries that we have already talked about. The workers are abused. They’re physically and financial abused by the low wage rates and the hours they must endure," said Moeller.

Ramsey said that the effect of CAFTA’s tariff removal clause will amount to less than one percent of U.S.’s Gross Domestic Product because the U.S. already has a $3.2 billion trade deficit with Central America and the Dominican Republic and will undoubtedly remain so under CAFTA.

Free Trade Hurts Families

Sims of Texas Farmers Union and Larry Mitchell, American Corn Growers Association CEO, said their organizations would not support CAFTA because it benefits U.S.-based multinational corporations over member nations’ family farmers and ranchers.

What happens in agriculture in the U.S. greatly impacts the rest of the world, said Mitchell, because half the world’s population supports itself on farming compared to roughly one million U.S. farmers.

The future effect on these six new member countries — all small in size, population and purchasing power — can be seen by NAFTA’s impact on Mexican farms. Under NAFTA, although estimates vary, between two and 10 million Mexican farmers were put off their land because they could not compete with U.S. corn which is subsidized by the U.S. government.

Compounding Mexico’s situation is that the U.S. uses genetically engineered corn which increases supply even greater.

On top of that, corn is the food staple of Mexico, an integral part of its farming economy and culture, he said. Without corn to hold the population in Mexico, the farmers leave to find better jobs elsewhere.

"Anyone who has had a lot of new visitors lately who are threatening the infrastructure of your local communities will understand that people pushed off their land have to go somewhere to eat and go somewhere to live. It’s devastating not only for farmers in the United states but also Central America," said Mitchell.

As far as NAFTA being a border protection program, Moeller said it was not intended to work as such.

"NAFTA was not created to make our borders safe. NAFTA was a trade deal, so I’m not sure the border has anything to do with a trade agreement," she said. "Our jobs are going across the borders, and even Mexico is not safe. Mexico is not cheap enough, and now they are going farther and farther, so when you look at 900,000 jobs in this country that are gone, that’s 900,000 families that are having difficulties feeding their families. They’re having difficulty finding other jobs. They lost health insurance. They can’t educate their young. That’s a huge amount of our population."

Mitchell recently returned from meeting with farmers and national leaders in Costa Rica at the invitation of Carlos Solís, leader of Upanacional, an organization representing the country’s small-and moderate-sized farms. He said the Costa Ricans understand the "raw power" inflicted upon them when free market measures are tilted unfairly favoring U.S.-based multinational corporations. The average Central American worker is earning $2 or less a day, said Sims.

With CAFTA, countries like Costa Rica must eliminate their import tariffs which protect their farmers from imported goods produced by farmers that receive huge U.S. subsidies, while the U.S. will not reduce its subsidies to its farmers. However, "the disease is not the subsidies," he said. "The disease is the low price."

"The problem with developing countries and U.S. subsidies is the U.S. can’t afford some subsidy to provide the medication to the disease of low prices. Developing countries can’t afford that medication. This is not unlike diabetes, AIDS or any other crippling, threatening, or deadly disease. If you get the medication you might survive," he said. "We need a new system in the United States and around the world so farmers all receive a fair price." Mitchell said that in the last week of March, a letter opposing CAFTA signed by over 100 farm organizations in the U.S. will go to the U.S. Congress. Two weeks ago, the National Association of State Departments of Agriculture — the ag commissioners in all 50 states — opposed CAFTA. Texas Farm Bureau has also stood against CAFTA.

"CAFTA will continue the old, failed block policies of the past and continue the race to the bottom for commodity prices," said Sims. "The agreement fails to address the things that cause unfair trade agreements, such as the deflation of currency values, labor and environmental standards, and food, health, and safety standards."

Free Trade Hurts Democracy

The panelists at the Crawford Peace House echoed the concerns of CAFTA critics over the agreement’s use of patent rules that limit poor people’s access to lifesaving medication, and said they were a part of a world-wide effort to stop free trade agreements from being ratified. So far, trade representatives from El Salvador, Honduras, Guatemala, Nicaragua, the U.S., and Costa Rica have already signed CAFTA. The congresses of El Salvador and Honduras have ratified the agreement, leaving Panama, Nicaragua, Costa Rica, the Dominican Republic, and the United States to do so.

Guatemala became the third Central American country to ratify CAFTA on March 15. Guatemalan police killed two activists in the highland region of Huehuetenango near Mexico. The police fired live rounds into the crowd of protesters who were calling for a referendum on the trade agreement. Several more protesters have been injured, and many more are missing. In the days leading up to the ratification, some of the biggest protests in the country’s history occurred in its cities and rural areas. Backed by the army, riot police used water canons and tear gas on the 30,000 protesters, some armed with gasoline-bombs and rocks.

After the violence in Guatemala, U.S. defense officials said last week they were considering giving more military aid to Guatemala, a decade after cutting off such resources due to the Central American nation’s human rights abuses during its 36-year-long civil war.

A country now ravaged by gangs, drugs, kidnapping, disappearances and high crime, Guatemala once received military aid totaling about $30 million during the 1980s. Since the mid-1990s, the U.S. military aid reached the $3.2 million mark in Guatemala. Economic aid has exceeded $100 million a year.

Even as this military aid trickled in, millions of dollars were secretly moved from the CIA to support repressive right-wing regimes in their wars against leftist guerillas.

U.S. officials say that given the military downsizing efforts of the Guatemalan administration, the U.S. is now willing to increase military aid.

Fair Trade Rules

Sims said that the alternative to free trade, which was a policy practiced by the Roman Empire for over 300 years, is fair trade — trading goods for goods, not wealth for goods — along with price controls and tariffs that leveled the playing field among countries.

Under fair trade instituted by President George Washington and with tariffs implemented by President Abraham Lincoln, Sims said, the United States became a nation of manufacturers that didn’t export its jobs elsewhere to exploit its workers for an average of 10 cents a day.

"Free trade is new to us, not that it hasn’t been tried before. Certainly, that’s part of what led to the Great Depression of the 1930s, which I hate to say this, but I remember part of that. I was born during that time," he said. "It’s because of those so-called free trade policies, and then in the last 20 years, we’ve gone back into them. We fought a revolution, a civil war, and two major world wars against that very thing."

Last year, the United States had $1.5 trillion in trade that was equal, but $618 billion worth was bought and financed with foreign wealth. Within 10 years, it will take three percent of the U.S. gross national product to pay off this trade deficit, Sims said.

When asked, Sims explained that NAFTA and the World Trade Organization’s policies did more damage to the U.S. economy than the terrorist attacks on Sept. 11.

Ramsey explained that before NAFTA, the United States had a trade surplus with Mexico. Today, it’s the opposite. More good are being imported into the U.S. from Mexico than ever. The cost to people in Mexico is 40 million people living in poverty with wages down and cost of living up, she said.

Like NAFTA’s devistating effects on the North American economy, Anne Johnson, Public Citizen representative, said that CAFTA will undoubtedly spoil Central America’s ecosystems.

Johnson used NAFTA’s laxness on diesel emissions from trucks from Mexico as an example of the serious safety and environmental hazards that are related to NAFTA.

The cancer risk from diesel emissions, she noted, is seven times greater than all the other toxins combined. Mexican trucks emit 30 percent more diesel pollution on average than U.S. trucks. NAFTA-related truck traffic is expected to increase by 400 percent by 2020.

The problem Canada faces with these free trade agreements is the privatization of its social services, like its nationalized healthcare programs, said Ramsey, Director of Texas Fair Trade Coalition.

Free Trade Hurts Puppies!

During the trilateral talks between the heads of Mexico, Canada, and the U.S., about 40 protestors stood at University-Parks Drive and I-35 near Baylor University, braving infrequent bouts of verbal intimidation and receiving sporadic car honks of support.

The demonstrators organized under several banner issues such as anti-war, living wage, fair trade, and women’s rights: "How many lives per gallon?" "End the torture now!" and "NAFTA Bi-Products: Femicide in Cd. Juarez."

Several protesters were students from Baylor University, while others organized with Waco Friends of Peace and the Crawford Peace House. Leilani Ogujioffor, 23, a representative for Baylor Democrats and Students for Social Justice, said she participated in Wednesday’s protest to show people that not everyone at Baylor University and in Texas agrees with the Bush administration’s stance on policies throughout the world and the United States.

"We’re out here for real issues. We’re not out here spouting whatever," said Ogujioffor, a senior majoring in Biology, minoring in International Affairs. "(For instance,) how is a working person supposed to pay $2 a gallon to go to work and have money to eat at night when they are making $5.50 an hour?"

Three members of the Atheist and Agnostic Society, a student group unaffiliated with but that meets at Baylor University, also protested the three-nation CAFTA summit with the same intensity as the others but with a more lighthearted approach. They carried signs that said, "Think of the Puppies" and "Bush Drowns Iraqi Puppies," even though they had no puppies with them at the time.

"People are very serious, and we thought we’d get our message across with a little humor," said Justin Muller, 18, student of political science and law. Jay Jackson, 18, said that his biggest "beef" with President Bush is his use of religion in order to garner support for war in Iraq and trade policies that financially harm other countries.

"Part of the reason I became an atheist was because I was tired seeing people’s religious beliefs used for other purposes, like when you believe something like that, people can come along and use that to make you do things they want you to do, and that just bothers me," said Jackson, a psychology major.

The three members of the AAS said that they doubted they would be expelled for participating in Wednesday’s protest near the campus. When asked if the eight Army helicopters flying over I-35 intimidated him, Muller said, half-joking, "We’re the longest persecuted minorities in the history of society, so it takes a lot more than black helicopters to intimidate us."

4. Now Bush is Picking on Kids

John Nichols, The Nation, Sun Mar 27

Think of Ann Veneman as the Paul Wolfowitz of food policy.

Just as Wolfowitz used his position as the Bush administration's deputy secretary of defense to spin whacked-out neoconservative theories into the justification for an illegal and unnecessary war, so Veneman used her position as the administration's secretary of agriculture to spin equally whacked-out theories about the genetic modification of food and free trade into disastrous policies for farmers and consumers.

And, just as Wolfowitz is being rewarded for his missteps and misdeeds with a prominent new position as president of the World Bank (news - web sites), so Veneman is also moving onto the world stage, as the likely nominee to be the next executive director of the United Nations (news - web sites) Children's Fund (UNICEF (news - web sites)).

When Veneman was nominated to serve as George W. Bush's first secretary of agriculture, this column detailed the many reasons why that was a horrible idea. A militant advocate for the genetic engineering of food and an unblinking proponent of the North American Free Trade Agreement, U.S. entry into the World Trade Organization (news - web sites), and other trade policy moves that were designed by agribusiness conglomerates to benefit agribusiness conglomerates, Veneman was on the wrong side of every issue that mattered to working farmers in the United States and abroad. And as a veteran beneficiary of agribusiness largesse - as a lobbyist, corporate board member and industry insider - she was not about to start listening to reason simply because she was briefly leaving the private payroll to take a government check.

Veneman lived up to the most dire expectations regarding her nomination, creating a record of service to the interests of multinational corporations at the expense of farmers and consumers. She drew the boos of farmers on her rare visits to rural America. And for good reason. She turned the Department of Agriculture into an echo chamber for the advocates of free trade agreements that have dramatically undermined the income and long-term viability of U.S. farmers, and for Monsanto and other firms that are seeking to force farmers to plant genetically modified crops and inject cows with bovine growth hormones.

Worst of all, on issues such as the discovery of mad cow disease in the United States and Canada, she seemed at every turn to be more interested in the business and trade impacts of those revelations than the very real public health issues that they raised.

Veneman has stepped down as secretary of agriculture but, in what has now become a pattern for the Bush administration, her years of disservice have been rewarded with selection to serve as the new executive director of UNICEF, the U.N. agency that is responsible for protecting children's health, welfare and rights.

Veneman is expected to get the job because of the defining role that the Bush administration plays in the selection process, just as U.S. pressure set up Wolfowitz for the World Bank position.

The notion that Veneman would be placed in a position to decide how to feed and care for the planet's most destitute children is every bit as alarming as the notion that Wolfowitz would be charged with providing aid to developing countries.

Indeed, as Ravi Narayan, coordinator for the global secretariat of the People's Health Movement, wrote in a letter to U.N. Secretary-General Kofi Annan (news - web sites) and the members of the executive board of UNICEF: "Ms. Veneman's training and experience as a corporate lawyer for agribusiness do not qualify her for the substantial task of leading the agency most responsible for the rights of children worldwide. There is no evidence in her tenure as U.S. secretary of agriculture, secretary of the California Department of Food and Agriculture, or deputy undersecretary for international affairs of the USDA of her interest in the world's children or their health and well-being.

"Indeed, her performance in these positions has been characterized by the elevation of corporate profit above people's right to food (U.N. Declaration of Human Rights, Article 25). Such a philosophy and practice would reverse almost six decades of UNICEF's proud humanitarian history and prove disastrous for the world's children."

Just as it is vital for responsible Americans to object to the selection of Paul Wolfowitz to serve as president of the World Bank, so it is equally vital that we object to the selection of Ann Veneman to lead UNICEF.


5. The Rights of Rural Americans[1]

John Ikerd

Changes in agriculture are raising new questions regarding the rights of all rural Americans. Historically, farmers have defended their "right to farm," whenever residential development has brought in urban neighbors with no appreciation for the normal sights, sounds, and smells of farming. More recently, rural residents have claimed their "right of self-defense" against growing threats to their health, safety, and welfare brought on by new industrial farming methods, particularly large-scale confinement animal feeding operations (CAFOs).

Rural residents have argued with increasing success that industrial agriculture is not farming, at least not the type farming protected by right to farm laws. Instead, they claim that CAFOs represent the unwelcome intrusion of a dangerous, obnoxious industry into their communities. The agricultural establishment has responded with widespread efforts to restrict or deny the rights of rural communities to impose any higher standards for protection of public health and the environment than that required by state law. Iowa already has such a law. Similar initiatives are currently being promoted in Missouri, Pennsylvania, North Dakota, Kentucky, and undoubtedly other states of which I am not personally aware. A similar initiative at the national level seeks to prevent states from adopting higher public health and environmental standards than those imposed by federal law. The fundamental questions seem to be whether local communities have the right to exceed state standards in protecting their health and environment, and whether states have the right to exceed federal standards. The answers boil down to a matter of rights.

Questions of pubic rights can be resolved most clearly by relating them to personal rights. After all, government - whether local, state, or national - is simply the means by which we formalize our relationships, whenever the numbers of people involved are too large to resolve matters personally. Similar questions of rights and responsibilities arise anytime people relate to each other - whether within nations, communities, or families. It's just easier to see the logical answers to such questions in personal relationships among family members.

The federal government has the right to set minimum standards of acceptable conduct, as required to protect our constitutional rights. All rights not granted to the federal government by the Constitution are reserved for the states. States obviously are not limited to enforcing the federal minimums for acceptable conduct. In fact, the vast majority of all criminal and civil laws are state laws. State laws cannot conflict with federal laws but may go far beyond the federal minimums, when needed to protect and promote the wellbeing a state's residents. People within families and communities have a responsibility to conform to both state and federal minimum standards of conduct; otherwise, they are breaking the law. It also seems logical and reasonable that families and communities have every right to exceed the minimum federal and state standards of conduct, if they choose to do so - just as states have the right to exceed federal minimums.

The basic right to exceed standards set at higher levels of government seems obvious when we relate it to standards of behavior among people within families. For example, it is generally conceded that parents do not have the right to physically abuse or willfully endanger the health or life of their children, although some may disagree with specific child welfare laws. But surely, no one would argue that parents do not have the right to treat their children better than the law requires. Surely, no one would suggest that parents must consult a team of pediatric experts before they can give their children better healthcare, nutrition, and clothing, or a better social and physical environment than is required by law. Who possibly could defend a law stating that parents could not educate their children beyond high school, unless they could produce scientific evidence that their benefit will outweigh their costs? Families obviously have a right to set their own standards of health, safety, and welfare, as long as they exceed minimum legal standards.

People in communities have the same basic rights as people in families, but community standards have to be defined and enforced by laws rather than social norms and values. There are simply too many people involved to resolve all matters personally. People in communities have the same basic rights as people in families in setting higher-than-minimum standards of conduct for people in their community. States likewise have the right to exceed national standards of health, safety, and public welfare.

But, what about situations where community standards have already been set, as in the right to farm? In such cases, changes in community standards would seem to represent a "taking" of existing rights, as is argued by the agricultural establishment. Such arguments would seem justified in those instances where farming practices are no more intrusive on their neighbors than when right to farm laws were initially accepted by the community. Communities still have the right to set higher standards, but they don't have the right to force previously conforming farmers to change.

Again, the family metaphor is relevant, as a "grandfather clause" is said to apply to conforming farmers. In families, grandfathers aren't necessarily required to change their ways, even if the rest of the family chooses some higher standard of conduct. But, the rest of the family certainly doesn't have to limit itself to grandfather's level of behavior. Equally important, if grandfather starts misbehaving, by violating his earlier standards of conduct, the family has no obligation to accept his new behavior, just because his old behavior was "grandfathered in." For example, if grandfather starts mistreating the grandkids, he will quickly lose his honored status, even if he is doing nothing that violates state or federal laws.

So city, township, and county governments have a responsibility to conform to minimum safety, health, and environmental standards set by state and federal governments, if we follow the logic of rights and responsibilities of individuals. But, the people at each lower level of government have the right to choose standards that exceed those of the next higher level of government, without asking permission from some group of experts or providing scientific proof that higher standards are necessary. People in communities should always be open to expert opinions and scientific information, just as families should always be open to opinions and information. However, families don't have to ask permission to set higher standards of conduct and neither should local communities.

Following similar logic, farmers who are no more intrusive on their communities and their environment than when they were granted a "right to farm" still have that right; they have been "grandfathered in" to farming. However, this right to farm does not extend to industrial agricultural operations, such as CAFOs. Industrial agriculture is fundamentally different from the family farms to which the right to farm was meant to apply. The greater safety, health, and environmental risks of factory farming are well documented, and the documentation is readily available to all who are willing to inform themselves of the issue.

All farms smell and all farms have wastes, but factory farms stink and factory farms pollute. Smells may be unpleasant to those who are unaccustomed to them, but stink is just plain obnoxious and not only causes physical and mental discomfort, but also causes clinical illness. All farms also create potentially harmful chemical and biological wastes, which can make their way into groundwater and streams. However, when livestock are dispersed across the countryside, on pasture or in small-scale facilities, they present little risks to human health or safety. Likewise, when crops are produced in rotations to control pest and provide fertility, risk of water contamination by agricultural chemicals are minimal. Dispersion and dilution mitigates potential pollution on real farms.

However, industrial agriculture inevitably pollutes streams and groundwater, simply because they concentrate too many animals, too many antibiotics and hormones, and too many agricultural chemicals in too small a space. Cities are required to maintain waste treatment facilities, rather than allow individual septic systems. Extensive waste treatment is necessary to protect public health when too many people and too many industrial wastes are concentrated in too small a space. An industrial agricultural operation is more like a city than a farm, except it has thousands of animals rather than thousands of people and agrichemicals rather than industrial chemicals. So, existing farmers have no inherent right to become industrial farmers, unless they are willing to meet urban residential standards for use of chemicals and treatment of wastes. And, communities have every right to keep new industrial agricultural operations out of their communities, if they choose to do so.

This leaves only the argument that state and local health and environmental regulations cannot be allowed to interfere with interstate or intrastate commerce - that economic efficiency trumps public safety, health, and well-being. Again, the family analogy shows the inherent foolishness of this argument. Families have no responsibility to accept minimum state or federal standards, even when higher family standards clearly interfere with their participation in the marketplace. Families have no obligation to buy materials that they consider pornographic, even if such materials are legally for sale. Families have no obligation to sell their property to someone they consider to be unethical, even if that person is the highest bidder. Families have every right to reject any legal economic opportunity that they view as a threat to their health or well-being. And, they don't have to consult an expert or provide scientific proof of harm. Communities - counties, townships, and states - are made up of people and must be afforded rights as people. Rural people have every right to allow only ecologically sound and socially responsible economic development for their communities.

[1] "Sustaining People through Agriculture series," Small Farm Today Magazine, Missouri Farm Publications, Clark, MO. Jan-Feb, 2005.

6. Bhagwati, Globalisation and hunger: In an era of economic lunacy

By Devinder Sharma

Just before the failed Cancun WTO Ministerial in September 2003, there was a flurry of activity in the economic circles. Studies concluding that any drastic reduction in agricultural subsidies in the rich and developed countries would not make any appreciable impact on the global commodity prices were put out. The timing of the reports was crucial.

The underlying premise was crystal clear. Prominent economists in the developed countries (and their clones in the developing countries) had ganged up to throw a protective ring around much of the US $ 320 billion agricultural subsidies that farmers (in reality the big transnational companies) in the OECD - Organisation for Economic Cooperation and Development -- were getting.

It is now the turn of the Columbia University professor, Jagdish Bhagwati, to join the bandwagon. Writing in the Far Eastern Economic Review (and quoted in the Economist March 23, 2005), he says: "Agricultural subsidies are certainly undesirable. But the claim that removing them will help the poorest countries is 'dangerous nonsense' and a 'pernicious' fallacy." His colleague, Arvind Panagariya, defends it further by arguing that these subsidies make food cheaper for the importing countries. The timing is again perfect. The next WTO Ministerial is scheduled to be held at Hong Kong in December 2005.

This not the first time that Columbia university has emerged somewhere on the top of the global academic fraternity that unabashedly defends globalization. At the same time it is not unusual to see regular columns in various periodicals in the developing countries mainly from American university professors. Using their academic credentials, they write as if they have the right to sermonize. The world should sit in rapt attention and grasp each and every word of wisdom that flow from their tainted pen - tainted because they have the monumental task to protect their own livelihood security by promoting the flawed American economic policies.

Jagdish Bhagwati, I thought was still a breed apart. After all, he holds several eminent positions, including member of UN Secretary General Kofi Annan's high-level advisory group of the NEPAD process in Africa. As a former external adviser to the director general of the WTO, special policy adviser to the UN on globalization, economic policy adviser to the director-general of the erstwhile General Agreement of Tariffs and Trade, I thought he would have by now realized the fallacy of thrusting an unjust globalization and that too by creating an illusion of reducing poverty, eliminating hunger and leading to economic growth for all.

He agrees that agricultural subsidies are 'undesirable'. But in the very next sentence makes a complete turnaround and defends the subsidies by saying that it would make food expensive for the net food importing countries, and therefore terms the demand for its scrapping as a 'dangerous nonsense'.

This reminds me of the hypocrisy of the developed countries that had been earlier echoed by the former World Bank Chief Economist Nicholas Stern. While travelling through India sometimes back, he had denounced subsidies paid by rich countries to their farmers as "sin ...on a very big scale" but warned India against any attempts to resist opening its markets. "Developing countries must remove their trade barriers regardless of what is happening in the developed countries."

In reality, what Jagdish Bhagwati now calls as "dangerous nonsense' is actually a reflection of the economic lunacy that he finds himself and his tribe in. The growing anger against the fundamentally unsound economic prescriptions being doled out by these economists has already pushed at least 54 of the developing countries[1] into what I call as a 'dark age'. A majority of the developing countries have now become net food importing countries thereby gradually destroying the food self-sufficiency so assiduously achieved[2] . Economists therefore are now desperately searching for alibis that can protect them from public slur.

His colleague Arvind Panagariya also uses the same fallacious argument: "A study in 1999 found that 33 of the 49 poorest countries import more farm goods than they export; 45 of them are net importers of food. Subsidies depress the price of agricultural products on world markets. That hurts rival exporters, as Burkina Faso can testify. But importers gain." Economist from the IMF/World Bank would always echo such analysis. This time it is the turn of Stephen Tokarick of the IMF who even works out how India would benefit a bit, but the rest of South Asia would be $164 million worse off. Sub-Saharan Africa would lose $ 420 million, while North Africa and the Middle East would face a cost of $2.9 billion[3] .

The underlying premise is the same: agricultural subsidies in the rich and developed countries should not be scrapped.

Before we move any further, let me answer this. There is no denying that some of the least developing countries are dependent upon food imports. Good economics would surely aim at pulling these countries out rather than pushing them perpetually into the dependence syndrome. Needless to say these countries need to emerge out of the 'dark age' and become economically strong. This can only happen if the world agrees to cooperate and join hands in puling them out of the economic morass. And if you are wondering how this can be attempted or achieved, let me take you back to the times when India and China - a third of world humanity --- literally emerged out of hunger and starvation.

India's independence came in the backdrop of the Great Bengal Famine. Soon after Independence, India had begun to seek food aid and, in fact, emerged as the biggest food importer of the twentieth century. After all, for a country literally on a 'ship-to-mouth' existence, there was little hope[4] . The political ramifications of importing food were felt by the then prime minister, late Jawaharlal Nehru. It was as early as in 1955 that Nehru realized the pain of being food dependent, and in his Independence Day address from the ramparts of the Red Fort, he said: "There is nothing more humiliating for any country than to import food. Therefore everything else can wait, but not agriculture".

I am so glad that Jawaharlal Nehru did not seek the advice of Jagdish Bhagwati and his economist gang otherwise India would have remained a 'gone case' as most of the Sub-Saharan Africa is today referred to as. Fortunately, Nehru and his able successors followed the reverse route to globalization to attain economic sovereignty. Lal Bahadur Shashtri and Mrs Indira Gandhi later laid the foundations of a 'famine-avoidance strategy' to take India out of the blue and turn the country food self-sufficient. The strategy included raising tariffs to ensure that cheaper imports do not marginalize the farming communities. Given the right policy framework and incentives, the Indian farmers did the rest.

China too followed almost the same agricultural path to growth. Despite hiding behind the bamboo curtain, China's remarkable turnaround in agriculture laid the strong foundations for economic and political sovereignty. Both China and India have conclusively demonstrated how important it is for any country to get out of the dependency syndrome. Both these countries couldn't have emerged on the global map if they had followed the misguided path that IMF/World Bank and the mainline economists have been relentlessly pursuing. If India and China could do it, and do it so effectively, why can't the same model follow for the rest of the developing world, including Africa? Isn't it economic insanity to suggest dismantling a food self-sufficiency structure that virtually saved almost half the humanity from being led to a slaughter house??

And that makes me wonder whether there is truth in the words of the father of India's white revolution, fondly called as the 'milkman of India', Dr Verghese Kurien, when he said: "I am credited with having a public statement - which, incidentally, I have not denied yet - that a world without economists would be a lot better place for the human kind. May the tribe perish - for they never are there where the action is."[5]

For the 45 poorest and net food importing countries that Arvind Panagariya is worried about, the right path is not to remain dependent upon food imports from the United States and the European Union but to close the national borders by raising tariffs and to bring in policies and support mechanism that provide an enabling environment for their farmers to grow more. If Indian and Chinese farmers could do it, there is no reason why the African farmers cannot become economically viable.

But that will not be allowed to happen. After all, the transnational corporations can only garner more profits if one part of the world is kept hungry. We all know that mainline economists are working overtime to ensure that globalization increases dependence of more and more developing nations on the agribusiness corporations. It is always a hungry stomach that can be exploited and they know that.

One such way is to denounce the input subsidies paid to developing country farmers and label it as 'trade distorting'. At the third annual international conference on 'policies against hunger', organized by the German government at Berlin in October 2004, John Nash, a World Bank economist was at pains to defend the domestic subsidies being doled out to European Union farmers. In 1999, 56 per cent of all EU agricultural expenditure of approximately 78 billion euros was in the form of direct payment to farmers.

These subsides are believed to be non trade-distorting and therefore are justified. At the same time, the indirect input subsidies that the developing country farmers receive were painted as the villain of the free trade regime and needed to be immediately discontinued according to the economist. Asked what the developing countries should do in the event of withdrawal of the miniscule agricultural support being made available through cheaper farm inputs, he replied: "In the World Bank's thinking, the best way to encourage agriculture in the developing countries is to shift the farm subsidies to laying out rural infrastructure like link roads, providing electricity etc."[6]

In simple words, infrastructure development is the surest way to make agriculture productive, he concluded. "If rural infrastructure is what is needed to prop up agriculture than you will agree that the rich industrialized countries have already got a well-knit infrastructure in place," this writer said, and asked: "Why do the European farmers or for that matter a few million farmers on either side of the Atlantic should then be getting such huge support as direct payments?"

You guessed it right. John Nash very conveniently ignored to answer the question. Does it not mean that in the name of free markets the developed countries actually practice 'socialist' agriculture? How can those who swear in the name of market economy actually keep their own farming systems inside a well-fortified closed circuit??

In other words, the rich and developed countries have perfected a well-established state intervention programme to ensure that their farmers get a minimum level of income. Markets therefore have no meaning for the developed country farmers. These farmers, whether they live in the US, France, Germany, Switzerland, Japan or Australia, are financially insured and insulated from the volatility of the global markets. It is only the poor farmers in the developing countries who are being forced to face the vagaries and cruelty of the markets. For the rich, the scandalous cover of "green box" subsidies protects direct payments.[7] For almost 3 billion farmers in the developing world, even their own governments (based on the faulty advice of the mainline economists), are refusing to address the consequences of the grossly uneven playing field to which they are being exposed.

Instead, an unnecessary fear is being created over rising food prices for the urban poor. The food scare is aimed at the urban middle class knowing well the political clout they wield in the developing economies. Jagdish Bhagwati has surely played his cards well. He knows that the G-20 countries, for instance, will not be able to antagonize their own middle class. G-20 countries will therefore not be able to push for scrapping domestic support - provided through 'green box' and 'blue box' --- beyond a point and that remains the last hope for protecting the western agriculture subsidies.

Let us now understand the realities of cheap food. First let us look at how the prevailing subsidy structure is making food expensive in the developed countries. Surprised? Well, that is why it is kept hidden from the public gaze.

Take rice as an example. An average Indian farmer produces a kilo of paddy at approximately Rs 6.25. Taking the prevailing conversion rate of Rs 44 for a US dollar, each dollar would buy roughly seven kilos of paddy. Can the economists tell us where in the developed world can you get seven kilos of rice for a dollar? How come than the Indian farmer is then priced out of the market? In that case, isn't there something terribly wrong with the way economics is dictating the trade agenda? Even in the retail market, a kilo of rice is available for Rs 10, which means you can get more than four kilos for a dollar. On the other hand, look at the retail market in the UK. A kilo of rice is available at 2.54 pound sterling, good enough to buy 20 kilos of rice from India.

European and American consumers stand to gain immensely if they were to scrap the monumental domestic support to their farmers. Firstly it will mean that the tax payers in these countries do not have to support inefficient and environmentally-unfriendly production systems in their own countries. And then, if the US were to instead import its entire rice requirement it would be available at much cheaper price than what the American consumers are now paying. Isn't it economically foolish therefore to follow a marketing system whereby the total rice output of the United States is worth US $ 1.2 billion and the subsidies paid to rice growers stands at US $ 1.4 billion.

Do the US consumers realize that they can collectively save at least US $ 1.4 billion every year on rice by refusing to subsidize their producers? Cheaper imports from the developing countries will further lower the retail price of rice. It would surely price out domestic rice producers but the real beneficiaries would be the consumers. And in turn it would help millions of small rice producers in the Asian countries, who would then be able to find a substantial export market thereby raising incomes.

Let us take yet another example. If you are wondering as to why Indian pea producers are unable to competitively bid for processed foods in the global market, let us see how Denmark, for instance, manipulates the market and that too by truly following the WTO norms.

Danish pea farmers do not benefit from price subsidies. Danish split pea processing companies do not benefit from processing and marketing aids. Danish pre-cooked split pea exporters do not benefit from export refunds. So obviously, you will think that they are very efficient producers and of course very competitive. But hold on.

Since pea farmers do not have to recover their full production costs from the sale price of the peas supplied to processing companies, the price at which pea is supplied to processing companies is substantially reduced. As a consequence, the price at which pre-cooked split peas is offered for sale is substantially below the prices that Indian pulse growers can offer. The provision of direct payments thus enables Danish suppliers of pre-cooked split pea to capture markets, which they would never have been able to supply in the absence of direct aid payments.

Let me make it very clear. The comparative advantage that is cited by developed countries is actually built on agricultural subsidies. Withdraw the agricultural subsidies, there is no comparative advantage left for most of the crops and I repeat for most of the crops. That is why the mainline economists do not compare the cost of production of agricultural commodities but look invariably at the supply chain management.

No wonder, pea imports into India have multiplied four times in the past five years. While the Indian pea producers have been priced out by the subsidies imports, the Danish consumer has in reality paid more for the pea they consume. If only Denmark had stopped making direct payment to pea growers, and instead imported pea at a much lower available price from India and Africa, the saving for Danish household would have been enormous. Isn't that sound economics? But then, market economy as we well know now does not operate anymore on common sense.

What happens when these cheaper and highly subsidies agriculture imports come into the developing countries? The small and marginal farmers who have been cultivating these crops are the first ones to be thrown out of its cultivation. Gradually they abandon farming and migrate to the urban centers looking for menial jobs. Even if the food is available at low prices they often do not have the means to buy it. The reason is simple; unlike the industrialized countries, the producer in the developing countries is also the consumer. Unless he first produces and earns his livelihood he cannot afford to buy from the market.

It is for this reason that some 320 million people, a third of the world's 840 million hungry, go to bed hungry in India. It is not because there is not enough food in India. It is because these people cannot buy food even at 'below the poverty line prices'. They do not have the money to buy the cheap food that the government has made available for them. What they need is a job and that can come only from agriculture. After all in a country which has 600 million farmers, every fourth farmer in the world being an Indian, there is no other way to provide productive employment for all than to make agriculture more attractive.

The globalization that the neoliberal economists are trying to justify takes away these jobs. The poor in the urban centers therefore become eternally dependent upon cheap and subsidized food. It destroys their ability to produce the quantity of food that they now import. This is the outcome of a vicious cycle that the mainline economists have spun in the name of globalization. If only each country was encouraged to have a food production and management system that allows its farmers to produce for the nation's requirements, the world wouldn't have witnessed the kind of inequality that prevails and the resulting terrible socio-economic consequences.

But hold your breath. While we go on debating the issue of agricultural subsidies, the International Food Policy Research Institute in Washington DC, and some other economists at Cornell University, already have begun demanding subsidies for consumers. In reality it means subsidizing the expansion of the food super markets. If nearly 80 per cent of the agricultural subsidies are cornered by big farms and agribusiness corporations, an equal amount of consumer subsidy would be eaten by the Walt Marts. Wait and see how the mainline economists would justify the demand for the sake of the food retailers.

Millions are meanwhile being pushed into penury with each passing year. Millions are being driven away from their only means of livelihoods and thousands are perishing, as the mainline economists continue to misguide the political leadership. And that makes me wonder when will we begin to hold the economists accountable? After all, if a bridge collapses, we prosecute the engineers. If a doctor is held responsible for the death of a patient, we take him to court. Hundreds of thousands of people have silently suffered and continue to pay the price of faulty economics. Why only economist should be allowed to go Scot free? Why can't we hold them responsible?

The world has suffered enough from economic lunacy. It is time to stand up and make mainline economists accountable. #

(Devinder Sharma is a New Delhi-based food and trade policy analyst. Responses should be mailed to dsharma@ndf.vsnl.net.in

[1] Mark Malloch Brown, administrator of the UN Development Program, while releasing the annual Human Development Report had said: "In the so-called great decade, a very significant hard core of countries ended further behind with more poor people."

[2] Sharma, D. 2003: " WTO and Agriculture: The Great Trade Robbery" published on Z Net, Sept 2 http://www.zmag.org/content/showarticle.cfm?SectionID=13&ItemID=4121

[3] IMF working paper 03/110

[4] Sharma, D 2003: "Politics of Diversity and Food Security" chapter in the book The Value of Nature: Ecological Politics in India, edited by Smitu Kothari, Imtiaz Ahmad and Helmut Reifeld, Rainbow Publishers New Delhi

[5] Kurien, V 1997: An Unfinished Dream, Tata McGraw Publishing Company Ltd., New Delhi

[6] Sharma, D 2005: Montek's warped policies, Deccan Herald, Bangalore, Feb 5 2005

[7] For more about this scandalous jugglery of the 'green box' payments and how it impacts the developing country farmers, see the author's article: Green Box subsidies must go. Economic and Political Weekly, May 15-21, 2004.

7. New Crop: Windmills and Organic Beef


HOWARD, S.D. -- With farm jobs disappearing at a rapid clip, almost every small town on the American prairie dreams of getting bigger.

Some wait for Wal-Marts. Others push for new factories and jobs. Still others lobby for new roads, new highway exit ramps or new airports.

This town has a different plan, evident to anyone driving the two-lane blacktop that cuts east to west through Miner County. At the eastern edge of Howard, an old slaughterhouse that had been vacant for 30 years is up and running again, this time in the production of organic beef. Just south of the town's busiest intersection, where cattle once grazed, a new housing development is under construction, bringing seven low-cost homes. Two wind turbines tower over the western end of town. At their feet sits a small turbine-repair shop staffed by former farmers and tractor repairmen.

Howard and the surrounding Miner County are at the center of an unusual campaign to rescue farm towns from extinction. Backed by $6 million in foundation grant money, residents here have adapted a survival strategy that is both radical and modest. They plan to let some of the dying pieces of the economy die and focus instead on niches in which small businesses can compete -- like organic beef and wind-turbine repair.

The key, residents say, is that they're willing to accept the county's dramatic population losses -- down to about 3,000 residents from a peak of 8,500 -- as long as they can come up with enough high-quality jobs to prevent further declines.

"We don't need to be a Watertown or a Madison," says Randy Parry, a former basketball coach and high-school teacher who leads the revitalization effort, referring to towns with populations of 20,000 and 6,500, respectively. "We don't need to be big."

Some economists think Howard's approach might be the last best chance for towns that have seen family farms vanish and their economic bases crumble.

"In these communities, you don't really need much," says Stephan Weiler, an economist at the Center for the Study of Rural America at the Federal Reserve Bank of Kansas City. Many of those communities still have a relatively strong supply of skilled workers, Mr. Weiler says. The challenge is keeping them. "People need to ask, 'What do we have and what can we do that the market will value?' "

Miner County is fighting against a strong tide. The population is still falling and some of the county's experiments have failed to take root. In building an economy without a strong business base and heavily dependent on a handful of small ventures, the county is plotting a risky strategy. If consumers lose interest in wind energy or organic beef, or if Miner County businesses can't keep up with competitors in those industries, the economic revitalization will have to start all over again.

"We're the guinea pigs," says Mr. Parry, director of Miner County Community Revitalization. "Rural America is slipping by the wayside. If we don't do something about it in time, it will be too late."

Miner County sits about 65 miles northwest of Sioux Falls, a city of some 125,000 that's been growing about as quickly as many of its rural neighbors have been shrinking. For decades, the county was a thriving chunk of middle-American heartland, with hundreds of small farms raising corn and soybeans, and railroad cars crisscrossing the flat earth. At its peak in the 1920s and 1930s, even the county's smaller towns each supported a bank, a diner, a gas station, a grocery, a schoolhouse, and a bar or two.

As the smallest towns vanished, Howard, the county seat, became the life raft, with displaced residents clinging to its relative prosperity. But even Howard has been losing a dozen or so residents every year, and its population is now down to about 1,000.

One idea for turning things around came from the younger generation. In 1995, students at Howard High School surveyed Miner County's 1,000 registered voters and found that about half of all respondents were shopping in larger towns outside the county. The students calculated that if residents spent 10% more of their disposable income at local businesses, they would add more than $7 million to the local economy, assuming the money continued to circulate in the community at the normal rate. In the year after the survey, discussed widely in town, taxable sales in Miner County increased 40%.

Advising the students was Mr. Parry, 56 years old. Besides coaching basketball, he worked as the school's business teacher and ran a popular ice-cream shop called Coach's Corner. The student project gave him ideas.

He says he began to think of the community as he thought of some of his basketball squads. Once a team started winning, Mr. Parry observed, players seemed to practice and play harder. Crowds got bigger and cheered more loudly. As a coach, he called it momentum.

Though sales-tax revenue continued increasing for several years after the student survey, the economy was not so easily transformed. In 1996, the community's biggest manufacturer, Wrapit, which made wrappers for baseball cards, laid off 75 of its 210 workers. Soon after, Mr. Parry used a $20,000 grant presented to the high school to form the Rural Resource Center, which brought together students and adults to discuss ideas for improving the community.

They developed focus groups on housing, employment, health care and education. Instead of looking to outsiders for growth, they focused on how to lure back former residents who had moved away and keep the next generation from doing the same.

Meanwhile, a Minnesota-based nonprofit called the Northwest Area Foundation was looking for an innovative way to help a rural community. In 1997, it decided to offer a small town millions of dollars and other support over a span of 10 years. The community would determine how the money should be spent.

In November 1998, foundation officials arrived in Miner County the day after an enormous snowstorm. Small roads were almost impassable. Farmers were busy corralling animals that had climbed over snow banks and strayed from their land. Still, 80 of Mr. Parry's 82 committee members showed up to meet the out-of-towners.

Impressed, the foundation gave Miner County $500,000 in seed money to help it map a long-term strategy.

Mr. Parry quit his job at the school and devoted himself to the community-building work. The more he talked to residents, the more evident it became that no one wanted Miner County to get a lot bigger, or to change in a dramatic way. In other words, says Mr. Parry, they wanted the town "to feel like it used to be."

Local committees began organizing projects to build community spirit and demonstrate to the foundation that Miner County residents were ready to go to work. Residents pulled hundreds of tree stumps from downtown Fedora. They cleaned and painted old homes in Howard. Farmers attended seminars on how to make money on organic beef or alternative livestock such as elk and deer.

"It was grass-roots," Mr. Parry says. "It was grind work."

County leaders gave the foundation a 35-page plan that promised among other things to create affordable housing, build a child-care center, update land-use plans, help farmers explore niche markets and set up a business-assistance program. The key was getting the entire community involved and making better use of the assets already on hand.

In February 2001, the Northwest Area Foundation awarded Miner County about $3.8 million and the South Dakota Community Foundation, a nonprofit, kicked in $2 million more.

Not long after that, the first wind turbine went up in Howard. It was the work of a former Howard High School student, Joe Kolbach, who decided to open a repair shop for the machines in his old home town. He said he knew that many people who fixed tractor engines could learn to fix turbines.

"A small town with low overhead is what a young company needs," says Mr. Kolbach, president of Energy Maintenance Services of Gary, S.D.

The two turbines -- one purchased by the town of Howard, the other by Mr. Parry's group -- earned the town energy credits from one of the local power companies, reducing bills for everyone. They also served as a sign that things were changing. "To be honest," Mr. Parry says, "I still get goose bumps every time I drive by."

Mr. Parry's group created a revolving loan fund to help businesses start or expand. It helped establish a day-care center with preschool and Head Start classes in downtown Howard. The group pushed to get cellular phone service for the area. It helped convert a vacant school in Canova to a wellness center, with exercise equipment and a miniature-golf course.

When Robin Hattervig, the county's only dentist, began thinking about moving elsewhere, Mr. Parry's organization helped him apply for a federal grant that would pay him to see more Medicaid patients. Now, low-income patients drive from across the state to Dr. Hattervig's clinic, and he has hired another dentist.

Scott Lively, whose wife grew up in a small town in South Dakota, said he wanted to set up an organic-beef business in a community that needed jobs, even though he probably could have improved his profit margins by locating closer to a major highway. When he heard about an old slaughterhouse for sale in Howard, Mr. Parry's group offered to help him negotiate the purchase. "These guys were relentless," says Mr. Lively, 33, who lives in Martha's Vineyard with his family but has been spending much of his time lately in Howard.

Now, Mr. Lively's Dakota Beef is one of the more promising ventures in town. One local farmer already feeds cattle for Dakota Beef, and two more farmers have expressed interest in having their farms certified organic, Mr. Lively says. Dakota Beef employs 20 full-time workers and expects to triple that number by the end of the year, he says.

Still, Mr. Parry's group faces long odds in its fight to keep Miner County from slipping away. From 2000 to 2003, the county's population dropped a further 5.8%, according to Census Bureau estimates. From 2000 to 2001, 5.5% of all nonfarm businesses disappeared. Even some businesses launched with the revitalization group's help discovered there wasn't enough money to be made. A café, a cheese-making plant and a fish farm all came and went.

Only about one in four Howard High graduates who went to college in the late 1990s has returned, according to a recent survey. "The more highly skilled they get, the less likely they are to come back," says Larry Holland, who teaches at the high school and also serves as its guidance counselor, athletic director and part-time bus driver. "How would we employ an engineer in Howard? Those kinds of jobs aren't there."

The local high school and elementary school have suffered. As people leave Miner County for jobs elsewhere, they take their children and property-tax contributions, leaving the schools short of bodies and cash. Those left behind have voted to accept property-tax increases, but educators say the money coming in still isn't enough.

Howard High has been forced to lay off teachers and cut back on available classes. Even Mr. Parry's old business class that got the community revitalization started a decade ago wasn't spared.

Many students say they're encouraged by the recent burst of economic activity, but staying in Howard "would be the failure of my life," says Brianna Hanson, a 17-year-old junior, whose father works as a veterinarian for the state and whose mother is a nurse at a local nursing home. "When you see your parents struggling, it really peels a lot of your hope away."

As he drove through town one day in his pickup truck, down Main Street, out to Route 34, and over to the town's new industrial park, home of the turbine-repair shop and other small businesses, Mr. Parry acknowledged that economic forces will continue to wipe away many small towns.

"I read somewhere that someone said it wouldn't matter if everything between Sioux Falls and Rapid City were covered in ash," he says. He thinks at least a few of those small towns can be saved. For now, he says, one will do.