Moonage Political Webdream

A post by Vegeli from The Motley Fool

Keeping up Appearances (1)

In July 2004 in Geneva, the two pilots of the G-20, Brazil and India, shouted victory. The new WTO-agreement was presented as a step towards a new agricultural eve and was the result of an altered power balance. Really?

I become suspicious when I see the speed with which the US and the EU went flat on their belly. I become suspicious when I notice that the LDC’s (Least Developed Countries) are not at all enthusiastic about the result. And I become suspicious when I hear little resistance in the EU and when the protest is scarce and artificial.

It always takes a while to escape from our captive thoughts (2); here captive in the sense of restricted to the themes brought forward by the media. Will we be satisfied regurgitating ideas? No way, the search is on. Walk with me for a while and let’s start where the noise is/was. After all isn’t our motto De omnibus est dubitandum A good start to see what the WTO-agreement of Geneva is about (please read first):

Over the past year the Brazilian press fulminated against the wicked subsidies and the protectionism of the rich countries. Beyond any doubt the agricultural interests of the EU and the US are righteously exposed as malign. Nonetheless their interest were bargained brilliantly in Geneva.

The Hypocrisy of Geneva

One of the promises (for promises it only are) is an immediate 20 % cut in subsidies by the EU and the US.
Based on the agreement the EU needs to reduce its subsidies parting from 95,76 billion euros to 76,63 billion euros. Now, you need to know that the present level of EU subsidies is at 55,8 billion euros (3). Leaves us quite a margin! The US was even more smart by promising a lot but not specifying it.

And then we still have the technical side: AMS (agregare measure of support to be reduced substantially), Minimis, subsidies shifted from the red box to the green box (green box must be rationalised) or from a US blue box to another US blue box (with restricted value), …. Bureaucrats will see the complexity as a brain teaser, emphasizing teaser, and the politicians will rely on it to find an escape route, but from a practical side not even a cat can find her kittens back in this labyrinth. Progress can not be taken for granted.

The text was clearly a compromise that will serve as a framework of principles for future negotiations and nothing more. No important commitments have been made by the US and the EU. Be assured the saying from plunder by raid to plunder by trade remains valid.

The Extended Hypocrisy of Geneva

With the EU and the US not really giving in, the basic question is how could they reach an agreement?
In the best of WTO tradition, the NG-5 (US, EU, Brazil, India and Australia - the new non-group of the five agro-powers also called the FIP or Five Interested Parties) played for days the undemocratic game of the Green Room. Other countries were not allowed to participate in the negotiations. Moreover the African countries were later forced to accept the NG-5 agreement under the threat of abolishment of preferential import duties. Brazil on the other hand received two nice gifts for its cooperation. One from the US in the form of lower import duties for 152.691 tons of sugar cane and one from the EU in the form of lower subsidies on sugar (4).

Broadening Perception

We must wonder whether the agricultural conflict is still a North-South conflict and whether this recent evolution is not the expression of something bigger. Maybe the poles aren’t the real issue anymore.

In Brazil about 4 to 5 million small farmer families (without land of with land that is insufficient to feed themselves) are pushed aside by half a million latifundós (large estate owners). Of the 175 million Brazilian inhabitants, 44 million have insufficient nourishment. In India 320 million people (of 1,1 billion) are hungry while in the period 2000-2002 the world produced an excess of 65 million tons of wheat. And we’re talking about the two new agricultural powers here! We don’t need to be Friedman of Hayek (gosh what a bad choice!) to understand this is about purchase power and labor.

However the Lula-government (5) will create room for the co-existence of two models (see later on). For the harvest of 2004-2005 the 4 to 5 million small farmers are granted 7 billion Real of cheap credit and over the same period Lula will give 39,4 billion Real of export subsidies to the latifundos. The latter is done because Brazil needs to export goods to gather the necessary currencies to repay its huge foreign debt. But I don’t quite understand because the export of agricultural products contributes only 2 % to the total tax income of the state.

The two models are usually associated with the North and the South. The North is said to be productive, capital intensive, labour expelling, environmental hostile, export-oriented, briefly embedded in the agro-industrial logic. The South, the weaker model, is more autonomous, labour creative, more ecologic, family-oriented and connected with the local culture. But how valid is this traditional comparison in present Mc Luhan’s village? The multinational agro-industrial business has spread all over this globe and the African farmer who faced the dumping of EU chickens won’t be happier when challenged by the dumping of Brazilian chickens bred by the French MNO Doux.

He who knows the financial structure of the megacorporados realizes that in normal circumstances, they cannot compete with family-run companies (not the middle-sized companies who balance between capital and labour intensive production or Western based family companies who have to cope with sanitary and environmental regulations). The demand for repayment of capital, ROI, overhead costs, … cannot be compensated by the benefits of scale when compared to local farmers in developing countries who produce at the sole cost of a miserable living.

Growing Nuts

Over the past year the soya-boom led to immense deforesting in Brazil (25.000 km2 per year), the land gets even more concentrated in the hands of a few (1 % owns 45 % of the land), the use of chemicals intensified and land and water pollution increased dramatically. In the department Paraná, from January to July, 19 peopled died of the extensive use of chemicals.

Throughout the 20the century, nuts were an important export product of Brazil. The main production area was around Marabá (eastern Amazon) and later extended towards the Bolivian border. However since the year 2000 the export of nuts has fallen by half and Bolivia has become the market leader (from nothing a decade ago). How comes? The US and international institutions encouraged Bolivian farmers to switch from the cultivation of coca leaves to growing nuts. Therefore Brazilian farmers had/have a hard time competing with the heavily subsidized and tax-exempted Bolivian nut-sector.
But this is only part of the picture. In the past the Mutran-clan dominated the nut-sector (thanks to political protection and help). They had a monopoly from harvest to transport. The Bolivian Hurricane made them loose their monopoly which basically is good because the price paid to local nut producers tripled since 2000. Therefore people were leaving the cattle ranches and returned to the forests to become nut harvesters again (and it also slows down the deforesting). Intermediary we may conclude that the actions undertaken by the US and the international institutions had a positive effect. But that denies the reaction of the Mutran-clan. The Mutran-clan moved too. They have expanded into cattle ranching, cutting down the forest and its Brazil nut groves to make way for pastures and prevent squatters from seizing land and claiming title to it. The whole region has been devastated and since 2004 the nut harvesters have very little left. Everything has ended up in the sawmill. Maybe this is the main reason why the price tripled.
(see also an article in IHT - no link) PS the Mutran-clan complains about the circumstances but in reality the latifundos use three techniques to get it their way: increase their influence in the political and judicial sector, criminalise the farmer-unions and create militias. BTW Brazil is a democracy.

It reminds me of something Pedro Casaldaliga (6) said: it is true that it is better to learn someone how to fish instead of giving him a fish, but on the other hand what is the use of having the skill to fish when the river is polluted or the river is sold.

Acts of Despair

Over the past fifteen years an epidemic of suicides visited the farmers in India. Since May 14th of this year more than 600 farmers have committed suicide (run Google for links). Are they the victims of individual psychological problems? Perhaps there’s a link with the Green Revolution that started way back in the seventies in Rio Grande do Sul, the department in Brazil with the highest number of suicides?
Or still there might be a link with the high numbers of suicides amongst the US and the Belgian farmers?
Or is there a link with the fact that four fifths of the 840 million hungry in this world, are farmers?

In 2003 in Cancun the Korean farmer Lee Kyung-Hae committed a ritual suicide to demonstrate the despair of the millions of victims of the agricultural policy of the democratic nations. His sacrifice will be in vain and I hope that he will have a happier afterlife in an agricultural Walhalla.

The big (mostly foreign) agro-business joined the gang and the countryside will keep bleeding until all means of production are incorporated in the system, and all and everyone is alienated from the sources and can only sell their time. For is this not the core issue?

The Prices of Hunger

In the eighties an interesting book called Vraag en Aanbod, het prijsmechanisme als spil van de economie (7) was published (only in Dutch). I recall it because it so clearly described the imbalances in this world. Imbalances which only increased dramatically over the past two decades.

The chapter on the agricultural policy was called The Prices of Hunger and although the book unabatedly preached free trade, it didn’t spare it criticism on the policies promoted by the West.
The causes of hunger were attributed to a number of fallacies in agricultural policies, beginning with the Western subsidies, combined with the belief in industrialisation of the developing world and consequently the neglect of their agricultural sector, the negative effects of a strong currency policy and depressing tax policies applied by developing countries (artificial overvaluation to be able to import machinery which wrecked the local agricultural production).

In the last chapter the author discussed the prices in socialist countries. His main concern was that the lack of a price mechanism in those countries prevented a decent communication between the consumer and the producer. A correct analysis IMHO.

The present manipulation of the prices in our modern society through subsidies, cheap credit, fiat money inflation, a permanent war economy and more, also obfuscates a decent functioning of the market mechanism which must ultimately result in a correction or worse.

The Ultimate Betrayal

In the feudal system the serf was allowed to keep 50 to 70 % of the output of his labour and he could sell his products free on the market, keeping the added value for himself. Today in the capitalistic system for many goes that you can only sell your time to produce a product which you’ll have to buy later included the added value.

Freedom only exists when the greatest possible number of human beings can decide their own fate in all key sectors of life. Eight hundred and forty million human beings are hungry, a lot more are living hand to mouth and in case of a world recession a lot of (indebted Western) inhabitants could face that fate too (but are inapt to face it). Do they not represent the greatest possible number of human beings?

But a minority pleads for the subordination of freedom to the rule of the markets laws and the markets laws are ruled by the rich, or by the politicians, or by the church, … all men who arrogantly assume the perfectness of their knowledge and their wisdom. An assumption that’s solely based on the results of their privileged status (in the same sense read Galbraith - in one of his books, I vaguely remember).

How many of us have developed to that stage of mind? A rich man is always sold to the institution which makes him rich. Absolutely speaking, the more money, the less virtue, for money comes in between a man and his objects, and obtains them for him, and it was certainly no great virtue to obtain it (8).

But you reply that you’re not rich (or not that rich)! Therefore I provide you with a modern definition of rich. We, Western men, are rich of desires and wants. This material wealth pushes us in a situation that locks us in the present capitalistic system. A system that internalizes everything from sports, to sex, to taste, to warfare and to government, a system that alienates us from our labour, from our parents and from our kids and a system that is far more lean and powerful than we can ever imagine (9).

A state can never intentionally confront a man’s sense, intellectual of moral, but only his body, his senses. It is not armed with superior wit of honesty, but with superior physical strength (10). Although I was not born to be forced, I the Western man, am now captured or internalized.

My wealth has become my imprisonment. The days I was poor, the state could imprison my body but today it can deprive me from my precious money or future income and thus from my desires and wants.
I’m not a free man anymore because my desires and wants prevent me from choosing my fate.

The definition of freedom is therefore a two edged sword. For the poor man the lack of money will prevent him from achieving several key sectors of life and be materially free (food and shelter) while the rich man cannot be mentally free because he fears to loose the self-created key sectors in his life (his SUV, his holiday in Costa Rica, his yacht). The harshness of the existence of the poor man is therefore accompanied with a mental freedom versus the state. The state can take little from him that is precious and therefore we will have to rely on the poor to change this world.

Do I hear a cry out there that the poor should be happy in their democratic nation? Then he must answer me what democracy stands for.

Dixit the Greek doctrine the essence of the state consists in community of purpose (the state is an expedient in the words of Thoreau). In modern times the essence of the state is force. However the existence of force is for Plato and Aristotle a sign not of the state but of the state’s failure and is the result of conflicting misconceptions of the good. And a state that bases its legacy on force is already a contradictio in terminus. Can such a state be democratic? Democracy is a state where the freemen and the poor being the majority, are invested with the power of the state. An oligarchy is a state where the rich and those of noble families, being few, possess it. Aristotle adds that in a democracy the poor are king, because they are the majority and their will is the law. But Aristotle realized that this couldn’t work cause it would be the tyranny of the majority (the poor). He adds that all citizens have to be represented equally relative to their numbers, to guarantee equality and liberty, as well for the majority as for the minorities. Today we (should) know the constitutional democracy or the authority of the majority limited by legal and institutional means so that the rights of the individuals and minorities are respected.

Why not ask questions? Today we question God, we question patriotism, we question family ties, we question marriage, … but we do not question democracy. Why? We must really wonder whether our democracy is not ruled by aristocratic latifundos.

For fifteen years now I have not voted (obliged in Belgium). The disobedience was inflicted by a feeling and I have been looking for the source of that feeling for long. Perhaps because in voting lies a conflict.
The moment I vote I renounce a part of my rights to a person I do not really know. I have no certitude at all that the person I grant my rights to, is going to execute them in all honour and justice, I have no guarantee that he will represent me and my fellow man with respect for the democratic rules and I have no knowledge that his heart and mind are pure, briefly I doubt that he will do what he has promised.
I have a question. Would you in normal circumstances transmit your rights to someone you do not know? I bet you even wouldn’t grant your banker a blanco proxy for managing your portfolio over a period of four years (9). Well if you voted, you just did! And you won’t even be able to sue your representative.

Our Involvement

Do you remember when we had a full-blooded revolution for the last time? Was it in the seventies in Greece where the military junta was overthrown or the pink-revolution in Portugal that ended the reign of forty years suppression and fascism? Were the actions in Europe of the Red Brigade, the Rote Armee Fraction, the CCC, the IRA, the Basks, …, actions of civil disobedience, of revolution, of civil war or were it simply terrorists, the name they now get (11). Were it the crowds in Eastern-Europe who dumped Communism or was this only the aftermath of Capitalism that slammed the doors of the USSR (and China)?

I wonder whether Che Guevara would be called a revolutionary, a terrorist, a fundamentalist or an insurgent today, I wonder whether Thoreau would stand trial for his civil disobedience, I wonder how our present world would challenge Jesus, Mahatma Ghandi, Solzhenitsyn, Nelson Mandela, Martin Luther King, …. And I wonder how other cultures would judge Western heroes.

Other cultures: Mother India (an Indian movie from 1957)

A woman who was exploited her entire life by the same usurer, didn’t even revolt slightly against the man who made her loose her land, her jewels and her husband. In the last scene she even kills her son when he tries to kill the crook, just to save the honour of her family. The issue in the Indian movies are apparently not the combat between Good and Evil but rather that everyone does what he needs to do. Okay Indian cinema doesn’t project reality and is linked strongly to religion, but here too we notice the respect for the reigning order of this world. In the movie The Book of Love (1996) the main character is raped after twenty minutes and before she could meet her hero. For the public this was unacceptable and they left the cinema.

A modern hero: Ulysses

The son of Laertus and lord of Ithaca is the literary figure who opened western man’s eye to the possibility of gaining control of his life to make whatever he wants, defying fate and the gods. He even challenges the gods and blinds their offspring. His only ally is Athena, the goddess of intelligence. Ulysses stands for a new world dominated by intelligence, where classical values are reassessed and transformed. He is a hero but not a symbol of courage and honour. He is strong and able and wise, when circumstances require it. Yet he is not willing to sacrifice himself to fulfil a glorious destiny. Perhaps he is a subversive hero. That’s why Dante in his Divine Comedy grabs him and throws him in hell (in the 26th Canto). Dante believes he’s a bad lot who misuses his intelligence, who employs his brilliant mind for his own egoistic ends and not to glorify the Lord. But mister Dante why send Ulysses to hell, since there was no way he could know about Christian religion? Dante cannot find the answer and says (invented): I’ll put him in hell anyway, because after all there’s a limit to everything. Yet Dante grants Ulysses the honour of pleading his sake and he says Ye were not form’d to live the life of brutes, But virtue to pursue and knowledge high.

Some mythical and historical figures keep amazing by their modernity. No wonder that in the 20th century Ulysses’ voice emerged more than once in a brilliant way. James Joyce’s Ulysses where Leopold Bloom saves Dedalus (his Telemachus), a quest for emotions that give meaning to mediocre and unhappy life or Stanley Kubrick’s 2001 Space Odyssey posing the eternal issue of discovery and crossing the line.

Closing

Maybe if we skip the scarce good times, little has changed in this world. And maybe we don’t care.

Czeslaw Milosz: Campo dei Fiori (poet on indifference)

Il me suffit d’avoir été présent sur cette terre pour m’en juger le témoin, et donc coupable mais pour le moment, je m’en fous, je m’en fous de tout, je m’enfuis, j’oublie, je m’offre un paradis.

Veg.

(1) main source for the facts: Luc Vankrunkelsven, norbertijn van Averbode, and collaborator of the Brazilian agricultural union www.fetrafsul.org.br
See also: www.mst.org.br (also in English) and www.wervel.be

(2) in commemoration of Czeslaw Milosz who died in August 2004 (the Polish reader and poet who became the symbol of anti-totalitarian thought with his book La pensée captive)
www.economist.com/printedition/displayStory.cfm?StoryID=3104407

(3) not counting in the extension of subsidies due to the extension of the EU; but do you want to tell that to the African farmer?

(4) the LDC’s are the real victims here because they received from the EU the same price as European producers; by reducing the EU-subsidies on sugar it will be mainly the sugar producing LDC’s that receive less for their sugar (thus a reduction of subsidies on the back of LDC’s)

(5) Lula in Portuguese means octopus

(6) bishop in São Felix de Araguaïa, one of the poorest region in Brazil, lost somewhere in the state Mato Grosso

(7) I wonder why in the Anglo-Saxons always say Supply and Demand and continental Europeans Demand and Supply
(8) Henry David Thoreau, Civil Disobedience, Part 2 http://eserver.org/thoreau/civil1.html

(9) by and large people believe that Karl Marx claimed that capitalism was self destructive but that’s wrong; he wrote that capitalism is a contradictory system which can only resolve its contradictions through violent and barbaric measures. It would never self-destruct. Instead it would condemn humanity to global economic inequality, periodic depressions, wars and fascism in order to resolve its own contradictions

(10) see also in the same sense: Voter, une forme de renonciation, José Saramago (Le Monde Diplomatique, Août 2004)

(11) see the change of attitude in France about the extradition to Italy of César Batisti and other members of the Red Brigade, during the last weeks of August 2004

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