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The Institute for Agriculture and Trade Policy promotes resilient family farms, rural communities and ecosystems around the world through research and education, science and technology, and advocacy.

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Farm and Food Policy

May 14, 2008

Farm Bill a Missed Opportunity

The 2008 Farm Bill to be voted on by the House and Senate this week includes incremental gains for conservation, renewable energy, food aid and healthier, local food systems. However, it fails to reverse decades of deregulation that have increased agricultural market volatility to the benefit of global food corporations, and at the expense of farmers, consumers, rural communities and the environment.

Unfortunately, this Farm Bill does nothing to reverse the trend toward windfall profits for global food conglomerates. These companies have succeeded in pushing an extreme agricultural market deregulation agenda over the past three farm bills, including this one.

Congress dismantled grain reserves, acreage set asides and other market management mechanisms in the 1996 Farm Bill. Since then, agribusiness companies have reaped enormous profits. For example, Cargill’s profits increased nearly 1000 percent from $280 million in FY1997-98 to $2.34 billion by FY2006-07. In April 2008, Cargill reported net earnings of $1.03 billion in third quarter earnings, up 86 percent from $553 million in the same period a year ago.

These same global food corporations saw increased profits when farm prices collapsed by 40 percent after the market deregulation of the 1996 Farm Bill, and they are making even more money now that food prices have risen to crisis levels. Market deregulation in effect privatizes crucial market information, which suppresses price transparency and price discovery. This, in turn, increases the ability of big firms to manipulate prices.

While the debate continues to rage over how many billions in taxpayer subsidies are needed to maintain a legitimate safety net for family farmers, it has been a few big corporations that have been the primary beneficiaries of our commodity programs. Researchers at Tufts University found that industrial animal factories, owned and controlled by these same corporations, enjoyed $35 billion in indirect subsidies by being able to buy feed crops at 20-25 percent below the cost of production – a practice supported by the last two Farm Bills. Unfortunately, these corporate beneficiaries have almost completely evaded scrutiny in the Farm Bill debate.

Two new reports, from the Union of Concerned Scientists and the Pew Commission on Industrial Farm Animal Production, have documented the negative public health, environmental and social impacts of this unsustainable model of industrial meat production. The UCS report calls for strengthening conservation programs and antitrust enforcement; while replacing commodity subsidies with price supports to curtail this multi-billion dollar, cheap-feed subsidy to industrial animal factories.

Another glaring failure of the pending Farm Bill was the lack of political will in the House-Senate Agriculture Conference Committee to strengthen antitrust enforcement. While there were peripheral gains in curtailing the worst abuses of increasingly exploitive contracts against farmers, a majority of the conferees caved-in to the corporate lobbyists on the more substantive market reforms, like the ban on packer feeding, that would have curtailed anticompetitive practices that deny independent farmers fair market access.

This lack of political resolve couldn’t have come at a worse time for independent cattle ranchers. JBS-Brazil has recently launched a takeover of two of the top five U.S. beef packers, National Beef and Smithfield; and the nation’s largest cattle feeder, Five Rivers Ranch Cattle Feeding. If approved by the Justice Department, the merger would make JBS-Brazil—currently the largest beef packer in the world—the largest beef packer in the U.S. as well. Passage of the packer ban would have provided federal regulators with an important tool to potentially block JBS-Brazil from acquiring Five Rivers, and thereby might have mitigated one of the most anticompetitive aspects of the acquisition.

On the positive side of the ledger, the new Farm Bill does contain important bioenergy incentives. One important new program is the Bioenergy Crop Transition Assistance Program, which would provide farmers with financial incentives and technical assistance to accelerate the growing of “Next Generation” bioenergy feedstocks. It is based on the Reinvest in Minnesota Reserve–Clean Energy bill recently passed by the Minnesota Legislature. IATP worked in collaboration with other groups and members of Minnesota’s Congressional delegation to adapt its primary concepts into the Farm Bill.

This new innovative program will help farmers produce ethanol with native prairie grasses and other cellulosic plants, thereby reducing the pressure to grow more corn for ethanol; a prospect that is becoming increasingly controversial by the day. We want to thank Senator Klobuchar and Representatives Peterson and Walz, for their leadership on the agriculture committees in supporting this initiative based on the “Minnesota Model,” and succeeding in getting it included in the final bill.

Although IATP pushed hard to include another provision to require that biorefineries receiving federal support must be at least 51 percent community-owned, that provision was watered down to become one of several criteria that must be considered under the new bioenergy program. However, another provision does require that wages paid by federally supported biorefineries meet prevailing union wages in the region where the plant is located. Like local ownership, this important provision will help keep the wealth generated by the new bioeconomy circulating in rural communities, and not just siphoned off by Wall Street investors.

The Farm Bill agreement would also significantly bolster spending for conservations programs. For example, the bill would allocate $12 billion to a revamped Conservation Stewardship Program, which would help bring an estimated 115 million acres of working farm and ranch lands under improved conservation management practices over the next 10 years.

In supporting local food systems, one important provision would allow local and state governments to provide a “geographic preference” through federal procurement programs for locally grown foods. Another provision would provide funding for new local and regional food supply networks, including $33 million in mandatory federal funding for the Farmers Market Promotion Program. Additionally, the inclusion of a revamped country-of-origin labeling provision, along with allowing the interstate shipment of state-inspected meats, should increase marketing opportunities for independent livestock producers.

Another important provision is the inclusion of the Diversity Initiative, a policy package developed by unified rural and urban agricultural interests of African American, American Indian, Latino, Asian American and other small farmers and ranchers all across the United States. This package redresses outstanding issues of civil rights violations and significant land loss suffered by minority farmers because of inadequate policies at the United States Department of Agriculture, including a $75 million investment in the Socially Disadvantaged Farmer Outreach Program.

In the area of food aid reform, the bill includes a scaled-down pilot program that would allocate $15 million dollars annually to experiment with cash purchases for international food aid. A 2005 IATP report, U.S. Food Aid: Time to Get it Right, outlines the enormous problems in the current program. The report documents how the current program can result in the dumping of surplus commodities on developing countries’ markets in a manner that undermines local farmers, and can therefore harm long-term food production capacity. This pilot project is an important, albeit small, step forward in reforming the current U.S. Food Aid regime.

Finally, the Farm Bill extends the sugar program at a crucial time when it is under siege from the final phase-in of deregulation mandated by the North American Free Trade Agreement (NAFTA). It contains a new program that would use the growing sugar surpluses created by NAFTA and other free trade agreements to supplement corn ethanol production. This program could help stabilize corn prices, but also raises new questions about how much sugar and ethanol imports from outside of North America should be regulated.

Renewal of the Sugar Program, and the accompanying sugar ethanol provision, would provide more time for Mexican and U.S. sugar growers to continue pushing for an alternative agreement for “managed trade” for the sweetener market in North America, rather than simply standing by and allowing unbridled NAFTA deregulation to go forward unabated. We fear that the deregulation of the North American sweetener market will result in the destruction of the U.S. and Mexican sugar industries, which in turn will launch another wave of migration of farmers and workers who would be displaced from the Mexican sugar market that would rival the migration caused by U.S. corn dumping into Mexico in the 1990s.

Despite these incremental gains, the new Farm Bill does little to change the overall unsustainable direction of U.S. commodity policy. Neither the payment caps, nor the experimental revenue insurance program contained in this Farm Bill, challenge the premise of market deregulation. At the same time, the 1996 dismantling of publicly held grain reserves has left regulators without one of the most important tools to stabilize rising food prices in times of extreme market volatility such as we are experiencing today.

The so-called “commodity reforms” will do nothing to reverse trends toward increased market concentration, speculation and manipulation, indirect cheap feed subsidies to industrial meat production, increasingly volatile agricultural markets, or rising food prices.

It‘s time to rethink the fundamental assumption from the Enron era that market deregulation solves all problems. We need to reconsider an appropriate level of government intervention to mitigate inevitable market failures, such as those we are now experiencing with high levels of damaging market volatility.

For starters, Congress should consider how to best go about re-establishing strategic grain reserves to stabilize commodity prices, and to secure some predictability of feedstock availability for investors in the new bioeconomy. Additionally, Congress should hold hearings to review and, when appropriate, block pending and future mergers like JBS-Brazil; to explore the role that corporate speculators are playing in causing increased volatility in commodity markets; and to identify additional agricultural market reforms to increase price transparency and curtail damaging commodity speculation and price manipulation.

—R. Dennis Olson

May 08, 2008

Presidential Candidates and Food Prices

We've been hearing a lot from Presidential candidates on rising gas prices. But what about rising food prices? What is their plan to address increasing volatility in U.S. agriculture markets? And how will the candidates reform trade and aid policies to help countries around the world facing food shortages get the immediate help they need, as well as strengthen their own food production systems?

In a new commentary titled "Will the Food Crisis Finally Get the Attention of Presidential Candidates?" IATP's Alexandra Spieldoch and Dennis Olson offer some advice for the next Administration:

"Some have called for more laissez-faire policies that would support expanded trade as a response to the current food crisis. This approach is a dangerous one, particularly for net-food importing countries that lack food reserves and production capacity, making them the most vulnerable to price fluctuations that we are experiencing today."

Last month, IATP's Anne Laure Constantin outlined additional concrete steps to address the food crisis at the international level. Look for more from IATP on the food crisis in the coming weeks.

—Ben Lilliston

May 06, 2008

Biofuels and Biodiversity

The biofuel sector has grown so rapidly around the world, we are all still coming to grips with its impact - both good and bad - on the farm and food economy. A new report by IATP's Dr. Dennis Keeney and Claudia Nanninga finds that the first generation of biofuel feedstocks is exacerbating many of the environmentally-destructive practices of the current industrial model of agriculture. Specifically, the biodiversity of several of the major biofuel-producing countries is being threatened as feedstock production extends onto native vegetation.

Below is a press release from today:

Biofuels Contributing to Changing Land-Use Patterns, Affecting Biodiversity – New Report

Minneapolis – Increasing production of crops for biofuels is exacerbating agriculture’s impact on biodiversity in many parts of the world, finds a new report by the Institute for Agriculture and Trade Policy (IATP).

The report, “Biofuel and Global Biodiversity,” is by Dr. Dennis Keeney and Claudia Nanninga and is available at: www.iatp.org. The paper includes case studies of three regions that have been growing much of the feedstock for biofuels around the world: the U.S., Brazil and Malaysia/Indonesia.

“Ethanol and biodiesel are being overlaid on a broken agricultural production system,” said Dr. Keeney. “Many of the biodiversity impacts of biofuel feedstock production are not inherent to biofuel, but are more a symptom of damaging agricultural production systems and policies.”

The report found that in the U.S., increased corn planting is reducing the diversity of crop rotations and threatening wetlands and acreage set aside for conservation. In Brazil, greater sugarcane production for ethanol is moving into the fragile, diverse Cerrado region, and soy production for biodiesel is contributing to significant destruction of the Amazon rainforest. Perhaps the largest loss of biodiversity is occurring in the rainforests of Malaysia and Indonesia, where palm oil plantations are rapidly being established to feed the growing demand for biodiesel in Europe and elsewhere.

The paper found that the biofuel industry has expanded due to two complementary drivers: the increase in the price of crude oil and national policies to encourage the production and use of biofuel. It concluded that future policy solutions need to focus on:

• Protecting rainforests and fragile, native ecosystems and indigenous lands – The most significant biodiversity threat is from biofuel feedstock production that extends onto native vegetation;
• Making sustainability a priority in all biofuel production – Policies should encourage more sustainable production of existing biofuel feedstocks – and accelerate the transition to more sustainable next generation biofuel feedstocks;
• Moderating price volatility in agricultural commodities – An updated supply management system could stabilize market prices and reduce incentives to encroach on native vegetation;
• Redesigning our agricultural and energy sectors – Agriculture and energy policies should prioritize local production and use.

“Public policy has been a major driver in the development of the biofuel industry,” said Jim Harkness, IATP President. “In moving forward, smarter policy is crucial if biofuel production is going to protect and enhance – rather than decimate – global biodiversity.”

—Ben Lilliston

May 05, 2008

Monsanto and Agriculture Reporting

My old friend Russell Mokhiber at the Corporate Crime Reporter wrote last week about Learfield Communication's recent decision to cancel the show of farm broadcaster Derry Brownfield for comments related to Monsanto on his April 16 show. Brownfield criticized Monsanto for its ruthless tactics in enforcing seed patents with farmers. He quoted from an excellent article in the May issue of Vanity Fair by Donald Bartlett and James Steele, which chronicles the company's heavy-handed legal tactics.

The legal threat for farmers from biotech seed companies is not new. This issue spurred us to publish the report GMO Liability Threats to Farmers in 2001. The Center for Food Safety has documented over 100 cases where Monsanto has sued farmers over patent issues.

But aside from topic of Brownfield's last show, Mokhiber's story really points to a darkening shadow hanging over the dwindling number of farm and agriculture reporters in the U.S. - particularly at farm radio shows, magazines and weeklies. These farm media are heavily dependent on major agribusiness companies for advertising revenue. And as the U.S. agribusiness sector has become further concentrated, the agriculture press is forced to rely on fewer companies for a larger slice of their advertising.

The result is that the mainstream farm press, with a few exceptions, often misses big parts of the story when they cover hot button issues like the Farm Bill, trade agreements or rising agriculture prices. It is impossible to fully cover agriculture without reporting on how big companies benefit from the system. And more importantly, the whole story cannot be told without explaining how farmers' interests are distinctly different from major farm press advertisers like Monsanto and Cargill.

—Ben Lilliston

May 02, 2008

May Day in Southern Honduras

IATP Senior Fellow Mark Muller is working in a volunteer program in Honduras through July. He is blogging periodically on his experiences there.

Sometimes it can feel like we work in a little bubble. It's good to get out of that bubble sometimes to see how much others share IATP´s core concerns like keeping farmers on the land, respecting human rights, protecting the Commons, and keeping government and corporations accountable. I spent yesterday at a wonderful May Day celebration in Choluteca, Honduras, where hundreds of people marched in support of these issues. The hundred degree weather didn´t seem to phase people.

It was an impressive merging of labor unions, campesinos, human rights groups, environmentalists and the faith community. Unfortunately, it seems more difficult for these disparate groups to come together in the United States. Here are some photos below of the May Day celebration.

—Mark Muller

April 24, 2008

M. Lamy Out of Step on Food Prices

IATP's Alexandra Spieldoch and Anne Laure Constantin are in Accra, Ghana for the United Nations Conference on Trade and Development (UNCTAD) XII meeting through April 24. They will be blogging periodically on events in Accra.

Skyrocketing food prices feature high on UNCTAD XII’s agenda. WTO Director General Pascal Lamy addressed this topic to civil society representatives here on April 21. His take on the current food crisis and the role of the WTO was a disappointment to many. According to Lamy, the change in eating habits in developing countries is the main, long-standing factor leading to the increase in prices.

The day before, U.N Secretary General Ban Ki Moon had highlighted more comprehensively the mix of factors leading to price increases, including rising oil prices, climate-related production shortfalls, global economic growth, financial speculation, the shift to biofuels production and the depreciation of the U.S. dollar. For more details on some of these factors, see our recent paper on global agriculture prices and development.

M. Lamy’s argument missed the point. Take just one of the factors M. Ban mentioned: speculation. More and more money is going into financial investment in agriculture commodities. The UN Food and Agriculture Organisation (FAO) concluded that this has been made possible by the deregulation of international agriculture markets. As a result, the volatility of commodity prices is growing. Yesterday, in a debate on “the changing face of commodities in the 21st century,” a Tunisian representative estimated that speculation was responsible for a third of the price of food at the moment.

But no question: M. Lamy was not prepared to engage in a serious reconsideration of global trade deregulation. Hence the “disillusion” expressed by an African civil society leader towards the end of the meeting.

—Anne-Laure Constantin

April 21, 2008

Africa, Post-Colonialism and the Role of the UN

IATP's Alexandra Spieldoch and Anne Laure Constantin are in Accra, Ghana for the United Nations Conference on Trade and Development (UNCTAD) XII meeting through April 24. They will be blogging periodically on events in Accra.

The official UNCTAD XII meeting began yesterday with an opening plenary including speeches from the presidents of Brazil (Luiz Ignacio Lula da Silva), Ghana (John Agyekum Kufuor) and the Secretary-General of the United Nations, Ban Ki-moon. Secretary-General of UNCTAD, Supachai Panitchpakdi, spoke to the G77 earlier in the day and also to civil society groups the day prior. This meeting takes place at a critical time for Africa, which is drowning in unfilled promises for development - worsened by skyrocketing food and oil prices, climate change and unfair terms of trade and investment.

Yet again, government leaders acknowledge that the poor are being left behind in the globalization model. They are urging countries to work together to deal with the development crisis. However, their solutions are neither new nor will they curb the crisis today. They propose a "second generation of globalization" which would include: increased aid to meet the Millenium Development Goal targets; increased trade (including more South/South free trade agreements); increased "aid for trade" to further productive capacity; increased biofuels investment; and a green revolution in Africa. More of the same and then some….It is sad to see the UN so overtaken by the neoliberal agenda for development and growth. The reduced role of the UN is apparent. The implications for Africa are huge.

In relation to the food crisis, the UN seems to understand all of the problems associated with deregulated markets, financial speculation and the lowest grain reserves in history. Yet, surprisingly, UN officials caution against managing food supplies (i.e. price caps on certain goods and export/import taxes, and establishing grain reserves). Rather, they urge countries to wait it out and let the market regulate itself.  This policy is condemning people to starve at a time when they must be served by their governments and international institutions.

Ministers and other high-level officials from 49 of the least developed countries (LDCs) released a statement on April 19, calling for a "new deal" to tackle the international crisis caused by high food prices. They urge UNCTAD to support additional aid for agricultural infrastructure and domestic production, market access to developed countries and the integration of LDCs into the world economy. Immediate regulation at both the domestic and international levels is needed in order to achieve these objectives.

UNCTAD has written on the fact that foreign direct investment (FDI) has grown in Africa. What UNCTAD reports, however, is that FDI flows have not actually led to an increase in Africa’s share in global FDI. This is because 70 percent of investment agreements concluded by African countries have been with other countries in Europe. Much of the future investment will continue to be extractive (oil, gas and minerals). The majority of this investment has been in primary and services sectors and is due to the exploitation of African’s natural resources and privatization schemes.

Within Africa itself, only a few resource rich countries have benefited from FDI. These include Angola, South Africa and Nigeria. In spite of the fact that current foreign direct investment hasn’t led to GDP growth in most countries, UNCTAD is calling for regional Free Trade Agreements and more Bilateral Investment Treaties as the cure for the region.

It is clear that the UN’s role has been greatly reduced and co-opted by the trade agenda. Our challenge moving forward in this global economy is strengthening the UN and our commitment to one another and the environment. Africa is in terrible trouble in spite of its rich history, culture and vibrant spirit. We cannot stand back while our friends and colleagues suffer from this ongoing colonial paradigm.

—Alexandra Spieldoch

April 18, 2008

UNCTAD XII, African Women and Food Sovereignty

IATP's Alexandra Spieldoch and Anne Laure Constantin are in Accra, Ghana for the United Nations Conference on Trade and Development (UNCTAD) XII meeting through April 24. They will be blogging periodically on events in Accra.

According to the UN's Food and Agriculture Organization, women represent 80 percent of rural food production throughout Sub-Saharan Africa. In Ghana, the number is between 70-80 percent. However, women’s voices are largely absent from the global food and agriculture debates.

Yesterday in Accra, one of the first questions at a forum we co-hosted on women and food sovereignty  was: why wasn’t the voice of a Ghana woman farmer in the opening plenary of the Civil Society Forum preceeding UNCTAD XII?

We heard from a number of women agriculture leaders at the forum, which was co-hosted by Acord International, Action Aid International, Food Security and Policy Action Network (FoodSPAN), International Gender and Trade Network, Third World Network-Africa and Gender and Economic Reforms in Africa. 

In particular, we heard the testimonies of two women farmers on the role of women in agriculture in their part of the world:

Mme Beatrice Donkor - FoodSPAN: In the northern region of Africa, women are farming grains. They are also the majority producers of shea butter, livestock, small poultry and they process food. They have replaced men as the dominant force in agricultural production. Yet, management and decision-making processes continue to be male-dominated. 

Mme Lydia Sasu (photo left) – ROPPA (Network of Farmers’ and Agricultural Producers’ Organizations of West Africa) and International Federation of Agriculture Producers: In the South, women are planters of maize and plantains. They are also fish processors. Women handle the smoking, sorting and drying of fish. They are washing, peeling, grating, and pressing cassava into dough. They are also providing food for their families and cleaning.

We learned that structural adjustment policies and trade liberalization have created some disturbing changes in food systems in both the North and the South.

1.       The eating habits of Ghana communities are changing. For example, the younger generation is now eating rice, which has flooded the Ghana market since trade liberalization, instead of other traditional food items such as cassava and fufu.

2.       Farmers, majority women, that are unable to make a living are migrating out of rural areas.

3.       The cost of farm inputs is higher than the income that farmers receive.

4.       Rural networks are struggling to gain access to markets. 

5.       High food prices are increasing hunger in rural communities.

6.       Water is drying up in rural areas so women are traveling farther to collect water.

7.       Women lack land rights, technology, credit, infrastructure and resources.

8.       Women farmers and producers are not present in policy-making decisions nor are their concerns central in food sovereignty debates.

Participants at the event stressed the need to link agendas so that agriculture and development groups adopt gender into their analysis and action, and the global women’s movement commits to alternatives in food and agriculture in a more substantive way. 

In light of the global food crisis today, linked to high commodity prices, climate change, biofuels and financial speculation, it's clear that deregulating agriculture has been a mistake. And the message here is that we do not have any time to waste in correcting the problem. Controls are needed to manage our food system. In order to do this, support for human rights, including women’s rights, and reform of global governance overall are urgently needed.

—Alexandra Spieldoch

High Prices and Rural Development

In this time of high agriculture prices, we know someone is making a lot of money. On the buying side of the farm chain, Cargill reports third quarter net earnings of over $1 billion this week, a 69 percent increase from last year. On the input side, Monsanto announced record earnings earlier this month, also over $1 billion for its second quarter.

In theory, higher global prices should represent an important opportunity for farmers and rural communities in developing countries. But according to a new report released today by IATP's Anne Laure Constantin, many of the benefits of high prices are not finding their way to farmers due to higher production costs and the dismantling of important agriculture policy tools (thanks to World Bank, IMF and WTO policies) designed to help ramp up production and manage supply to address price volatility.

On Sunday, trade ministers from around the world will gather in Accra, Ghana for the United Nations Conference on Trade and Development (UNCTAD). The meeting represents an important opportunity to address the current failings in agriculture markets. You can follow the latest happenings at the UNCTAD XII meeting at IATP's UNCTAD web page.

Here is IATP's press release from today:

Can High Agriculture Prices Spur Development?

UNCTAD Meeting an Opportunity to Address Agriculture Markets, New Report

Minneapolis/Accra – Trade ministers gathering in Accra, Ghana for the United Nations Conference on Trade and Development (UNCTAD) should take steps to support agriculture and manage supplies to address price volatility, according to a new paper by the Institute for Agriculture and Trade Policy (IATP).

“A Time of High Prices: An Opportunity for the Rural Poor?” written by IATP’s Trade Information Project Officer Anne Laure Constantin, is being released in Accra today, and is available at www.iatp.org.

The paper finds that governments have been limited in their ability to help farmers take advantage of higher prices – due to free trade economics pushed by the World Bank, International Monetary Fund and World Trade Organization. Trade liberalization has encouraged the dismantling of agriculture programs in many developing countries, making it difficult to ramp up production and manage supplies to stabilize prices.

“The push to deregulate national and international agriculture markets needs to be reassessed,” said Constantin. “UNCTAD has historically been at the intersection of commodities and development. They could play a constructive role in addressing unfair markets and stabilizing prices.”

The paper found that while agriculture prices are rising almost across the board, farmers in poor countries aren’t benefitting as much as they could. Instead, many of them suffer from the spike in food prices. Skyrocketing energy and input (fertilizer and seed) costs are increasing the cost of production. Gains from export earnings are being swallowed up by the exporting company and profits have not found their way back to farmers.

The paper called for:

·         UNCTAD XII to reassess the need to regulate agriculture markets. High prices can be a tool for development and poverty alleviation, but they will not achieve these aims if left to highly volatile and concentrated global markets;

·         Greater support for the agriculture sector, particularly in developing countries;

·         Coordinated action to manage agriculture supply to address price volatility;

·         Regulation of the food value chain to address the market power of transnational corporations and deliver on a fair distribution of benefits from producers to consumers;

·         Promotion of environmentally sustainable methods of production including assistance adapting agriculture to climate change;

·         Bioenergy policies that don’t threaten food security and adapt to local conditions and needs.

Constantin and IATP’s Director of Trade and Global Governance, Alexandra Spieldoch, are in Accra at a civil society forum from April 17-19, and then monitoring the UNCTAD meeting from April 20-24. You can find updates on all that is happening at the UNCTAD XII Ministerial at: http://www.iatp.org/unctadxii/

—Ben Lilliston

April 17, 2008

Salmonella, the FDA and Honduran Melon Exports

IATP Senior Fellow Mark Muller is working in a volunteer program in Honduras through July. He is blogging periodically on his experiences there.

If people in southern Honduras were looking for an issue to focus an overall, slow-simmering resentment of the United States, the recent ban on Honduran melon imports certainly has provided the spark. As the Honduran newspaper La Tribuna stated recently (in Spanish), “The fruit of discontent is no longer the apple…it is now the melon.” Fifty nine people in U.S. and Canada were sickened by salmonella, and the outbreak was linked to melons imported from Honduras, although the origin of the salmonella is in dispute. Much to the chagrin of the Honduran government, the U.S. Food and Drug Administration has blocked Honduran melon imports.

My first impression of the issue – surely formed through spending most of my life as a U.S. food consumer – was thankfulness that the FDA acted to protect the integrity of the U.S. food system. At least 59 people have fallen ill to a potentially serious bacterium; maintaining a safe and healthy food system should take precedent over trade relations or corporate profits. But I am probably the only person in southern Honduras who feels that way. Everyone I have talked to, whether they have financial interest in melon production or not, feels that the U.S. government is fabricating the situation in order to protect U.S. domestic fruit production, or perhaps to provide leverage in future trade negotiations.

Agropecuaria Montelibano, the exporter that allegedly shipped salmonella-tainted melons, claims that the ban has cost them $8 million and has put 5,000 jobs at risk. The potential loss of this employment would be devastating for small, rural communities here in southern Honduras, many of which are practically surrounded by melon fields.

(At left is a mural in the center of town in Choluteca, paying homage to the region´s watermelon and cantaloupe production.)

I don’t know enough about the situation yet to have a position in this debate. But this is clearly another example of a food system built without resiliency. The salmonella outbreak, wherever it occured, seems to have no geographic rhyme or reason, infecting people in 16 states and Canada. This region of Honduras has become completely dependent on exporting melons, sugar and shrimp, and few jobs exist in many communities outside of these industries. While top government officials and corporate executives will drive this issue, it will be a few unlucky U.S. and Canadian consumers – and thousands of very poor Honduran laborers – that will be most hurt.

—Mark Muller

April 11, 2008

Patent Reform for Farmers

When genetically engineered (GE) crops were introduced onto the market over a decade ago, the rules of the game changed for many farmers. Farmers who used biotechnology no longer owned their seeds. Instead, they leased the patented technology for one growing season from biotech giants like Monsanto. And they were forbidden from saving seeds for the next year, as farmers have since forever.

The emergence of GE crops signalled a major shift in the balance of power on the farm. When farmers bought GE crops, they also gave permission to biotech companies to visit their farm and test their fields to assess whether the company's proprietary technology was being used appropriately. Farmers who didn't grow GE crops, but whose crop became contaminated from neighboring farms, became vulnerable to patent litigation. In a highly celebrated case, Monsanto accused Canadian canola farmer Percy Schmeiser of using its Roundup Ready technology, even though Schmeiser had never bought the seeds. You can read more about Percy's long-standing fight with Monsanto.

Seven years ago, IATP published a paper outlining the legal risks for farmers posed by GE crops. Since then, the Center for Food Safety published an important paper documenting over 100 Monsanto lawsuits against farmers for patent infringement.

This week, a coalition of farm groups from around the country, including IATP, sent a letter to Senate leaders in support of the Patent Reform Act of 2007 (S.1145). The bill would revise the standard for "willfulness" in the violation of patent law. This is particularly applicable to farmers who have had their crops contaminated with GE material from neighboring farms without their consent, but still found themselves in court. The bill would also restrict the ability of the plaintiff (biotech company) to select venues. By selecting far away venues, farmers have often had to travel a great distance from their farm to defend themselves in court. This has been used as yet another tactic to pressure farmers to settle these cases.

The record has been abysmal at the federal level in terms of protecting farmers' rights in relation to GE crops. Several states, including North and South Dakota and Indiana, have passed their own protections with regards to patent infringement. The Maine legislature just this week passed legislation that would prevent lawsuits for patent infringement against farmers whose farms have been contaminated with GE material from neighboring farms.

These steps at the state and federal level to protect farmers from GE crop patent litigation are long overdue. The next prudent step would be a system that holds biotech companies liable for economic damages, when their technology contaminates crops, and farmers lose out on organic or non-GE price premiums.

—Ben Lilliston

March 17, 2008

NAFTA takes the spotlight: It's about time

“We're seeing the strongest opposition to free trade expansion in recent memory. NAFTA has become symbolic of the fears and apprehensions of globalization in general.” Eric Farnsworth, Council of the Americas.

Almost 15 years after it was ratified, the North American Free Trade Agreement (NAFTA) is increasingly in the spotlight. The U.S. public has a growing understanding about the link between trade and the economic and social challenges currently surfacing. Presidential candidates are being called on by the public to answer to NAFTA and the economy.

Over the years, there have been different views on how NAFTA has affected the environment, the downward wage spiral and loss of jobs, and rural development. And, while NAFTA is not responsible for all the woes in North America, it has clearly not fulfilled its promise to create good jobs, increase wealth and decrease migration.

During NAFTA, wealth increased only for a select few in each of the three countries. The gap between rich and poor has widened. And that gap is driving forced migration from Mexico into the U.S. Today, over 500,000 people cross into the U.S. from Mexico every year. The U.S.-Mexico border is the world’s highest immigration corridor. Remittances (money sent back to Mexico from migrants) were at $25 billion in 2007, coming in only second to oil as a source of Mexico’s foreign revenue. These remittances are not creating development in Mexico. Rather, they are a desperate attempt to ease poverty that has become so dire. Overall, NAFTA has worsened the economic divide between the U.S., Mexico and Canada.

IATP has argued for years that NAFTA-style deregulation is the wrong form of integration. A closer look at agriculture helps us understand just what is so problematic with the NAFTA model.

To prepare for NAFTA, the Mexican government dismantled its domestic support for agriculture, including land allocation laws, the grain reserve, programs for rural sector development, and tariffs on basic foods such as certain varieties of corn, beans, and dairy products. Decreased spending on agriculture in Mexico and tariff cuts combined with U.S. exports being dumped at below the cost of production. The result has been devastating for small farmers and contributed to unemployment and migration from the countryside. Over two million people have been forced off their land in Mexico since NAFTA, many migrating to urban centers within Mexico and the United States. IATP outlined some of the links between NAFTA, the U.S. Farm Bill, and Immigration in our Farm Bill series last year.

Many of those former farmers, unable to make a living in Mexico, have been absorbed into the agricultural sector in the U.S. Raul Delgado Wise, Executive Director of the International Network on Migration and Development, refers to this phenomenon as the “Mexicanization of U.S. agriculture.” In the U.S., most migrant workers in agriculture take seasonal jobs and are paid low wages by the hour for the amount of work done. According to the USDA, between 2.2 and 3.1 million undocumented immigrants work in three agri-food sectors: farming and fishing, meat and fish processing, and food service. Most of these workers come from Mexico. Once here they face incredible challenges, including the potential for death crossing the border to get here, poor wages, poor health care and housing.

While policymakers and the media are focused on the need for immigration reform in the U.S., they consistently fail to make the connection to NAFTA and to the systemic causes of forced displacement. Oscar Chacon, the Executive Director for the National Alliance for Latin American and Caribbean Communities, talks about the fact that in most cases undocumented immigrants are victims of extreme poverty and hunger in their country of origin and then again in the U.S. as they struggle to survive and evade deportation. And, while migration is not new, the number of undocumented migrants coming to the U.S. from Mexico has doubled since NAFTA came into force.

NAFTA hasn’t been good for U.S. farmers either. From 1992 to 2002, the U.S. lost over 200,000 farmers. The 1996 Farm Bill deregulated farm commodity programs leading to grain overproduction and 10 years of price collapse, until the recent ethanol boom. Cheap grains have indirectly subsidized the meat and processed food industry, whose operations have consolidated and whose profits have grown. From 1999 through 2006, Cargill’s overall profits went from $597 million to $1.73 billion. Meanwhile, the consumer has seen an increase in food prices since NAFTA.

Our neighbors in Canada share a similar story. The National Farmers Union in Canada reports that agri-food exports have increased substantially since NAFTA, as have corporate profits. Conversely, realized net farm income has gone down, farm debt has more than doubled, there are less farmers today, and food prices in Canada have risen.

With an eye toward a new Congress and President in 2009, the political opportunity is here to make a change.

On March 5, IATP co-organized a conference in Washington, D.C., entitled Linking Agriculture, Development and Migration: A Critical Look at NAFTA Past, Present and Future, to promote an alternative vision for this region among legislators and civil society. One major outcome was that Canadian MP Peter Julian (Burnaby-New Westminster), U.S. Congresswoman Marcy Kaptur (D-OH) and the Honorable Yeidckol Polevnsky (senator for Mexico State and vice-president of the Mexican Senate) announced their joint commitment to call for the renegotiation of NAFTA. Civil society groups in the U.S., Mexico and Canada have outlined concrete suggestions for what renegotiation would entail.

Perhaps the most encouraging outcome is that legislators and civil society were able to speak frankly about our moral responsibility to one another in this region and elsewhere. Economic integration could make sense, but not as we have seen it. Recognizing the fundamental errors with the NAFTA model, we must change our course so that integration is about regulated investment and managed trade in support or people, the environment and infrastructure, healthy and accessible food, a higher standard of living, and regional citizenship. What we are talking about is respect for communities, people and the environment, not just the profits of multinational corporations. Renegotiate NAFTA? Lives depend on it. And so does the stability of the region.

—Alexandra Spieldoch

March 14, 2008

Good Jobs, Green Jobs... for everyone!

IATPers Jim Harkness, Lindsay Dahl and I are all at the "Green Jobs, Good Jobs" conference in Pittsburgh today and it has been a very powerful and uplifting experience. Organized by the Blue-Green Alliance, which brings together the United Steelworkers and the Sierra Club, this is the first national conference to focus not only on the global warming and environmental challenges we face, but more importantly, on how we need to restructure our economy and create jobs to address these challenges.

Yesterday was a great start, with multiple speakers and panels on issues ranging from public policy and investment to the role of green chemistry and energy in rebuilding rural and urban economies. Carl Pope of the Sierra Club gave a stirring speech to help open the conference and place it in context, by asking the essential question: how do we ensure, as we move into a green jobs economy, that poor people, people of color and rural communities aren't left out? The response from Lou Schorsch, CEO of Flat Caron America and ArcelorMittal North America, the world's largest steel company, was emblematic of the problems we face: "I'm a business guy, so that's a hard question for me." 

Minnesota is the home of Dave Foster, the Executive Director of the Blue-Green Alliance, so it's not surprising that much of the work here has been highlighted. Minnesotan presenters included Minneapolis Mayor R.T. Rybak, Minnesota State Senator Ellen Anderson, and Piper Jaffrey's Lois Quam yesterday, with Senator Amy Klobuchar scheduled to speak today. While we know things aren't perfect back home and we still face many challenges in moving toward green and good jobs, it's clear that Minnesota has lessons and approaches that other states and regions can learn from, so a little "Minnesota-pride" is deserved!

For me, however, it is the focus on jobs, people and justice that has me most excited. Marko Trbovich of the United Steel Workers, gave a rousing speech to end yesterday's program, where he spoke directly to the connections between climate change and international trade. Some of the key points include:
- Climate change is the most pervasive form of globalization.
- Climate change is inextricably linked to international trade.
- To really make the policy changes we need to address global warming, we need to reform our trade system.

These connections with people and justice were brought into sharp focus this morning by an incredibly emotional and powerful speech given by Van Jones, Director of "Green for All" in Oakland, CA. Van spoke of the victories our movement has already achieved, shown most starkly in the fact that "polluters" are trying to sound just like us now on climate issues. But he emphasized that as we move forward politically and as a movement from the margins to the center, we need to make sure that we use this opportunity to bring all folks forward -- that the green economy isn't just about reclaiming "stuff," but more importantly a chance to reclaim thrown away children and lives. As Van said, those communities pushed down by a pollution-based economy need to be lifted up by the green economy -- we have the chance and obligation to create a green wave that can lift all boats and has a place for everyone. 

To create this "green pathway out of poverty," Van pointed to the need for the right policies, politics and principles. We need to create a green workforce to meet our new labor needs, but one that is open and accessible to our marginalized community members. Van then talked about some of the programs in Oakland that have offered training to the undereducated and formerly incarcerated, and how these opportunities -- including the chance to join a union -- are helping raise people out of poverty and bring them in from the margins. The Green Jobs Act of 2007, a part of the Energy and Security Act, can help us get there, through training 30,000 people a year in skills needed for our new economy.

Van also spoke to the need for a new politics, whereby we create a movement and the political will to truly address the problems we face - a "Green New Deal" that can provide the kind of governance we need at this critical time. And finally, we need the right principles, which means sticking up for the little people and not leaving anyone behind. As Van so eloquently stated, evoking the brutal abandonment of the poor in New Orleans after Katrina, and in the process the whole principle of climate justice: "We reject the politics of sink-or-swim in the time of floods." 

For me, Van and his work reflects the real challenges we face as we try to build this new green economy -- simply replacing an inequitable fossil fuel economy with a biobased or renewable economy based on the same power and political structures won't get us where we need to go. For the green economy to truly succeed, it is clear that it needs to start and end with justice for all. That means continuing to make sure that people of all classes and races are engaged in this work, and that we build the bridges and coalitions with farmers, inner city residents, indigenous communities, and others to make sure that the solutions put forward to our global warming and environmental crises are crafted to ensure that we move from hurting poor people and the planet to helping them both.

—Jim Kleinschmit

February 29, 2008

Food Sovereignty in North America

Earlier this month, I attended the Canadian Dairy Farmers annual policy conference in Ottawa, Canada. I was to provide a U.S. perspective on the topic of food sovereignty. The Canadian Dairy Farmers represent over 15,000 farmers across Canada.

It was an enlightening and encouraging meeting with some surprising elements. For example, when I arrived there were 60 parliamentarians mulling the floor of the hotel, conversing with the farmers as part of an evening reception. When was the last time 60 congressional representatives showed up to an event in the U.S. to support and talk with small and medium farmers at an evening reception? I was impressed to see this kind of interaction that is now so foreign to the U.S. experience.

The next day, I spoke to a room filled with at least 150 farmers from all over Canada. Also presenting that day was the Canadian Minister of Agriculture, Canada’s lead agriculture negotiator at the WTO, and one of our longtime colleagues from the Brussels based group Collectifs Strategies Alimentaires.

I listened to the Minister of Agriculture publicly present his support for supply management programs in Canada. When was the last time the U.S. government and Congress was willing to even use the term "supply management" for fear of losing credibility in the policy debates toward a new Farm Bill? I also listened to the Canadian trade minister present his optimism that a Doha deal is in our grasp. He reiterated though that much hinges on U.S. offers to cut subsidies. Based on the fact that the U.S. let its Fast Track authority expire and the Farm Bill debate has been so hotly contested, it is hard to imagine how U.S. negotiators can do much to secure a deal – particularly in the context of the national presidential campaign. Wishful thinking does not a deal make...

Perhaps the most exciting aspect of the meeting is that the Canadian Dairy Farmers Association has adopted the concept of "food sovereignty" as a platform within its work plan and seeks to build alliances within Canada and with other allies around the world (see definition of food sovereignty included below). I was invited to speak about the potential for developing a platform around food sovereignty in the United States. I will share a few thoughts for reflection.

The first is that food sovereignty itself means very little in the U.S. context. Why would it? The U.S. government does not recognize the Right to Food, which is part of the International Covenant on Economic, Social and Cultural Rights (ICESCR). We have an historic opportunity to change the discourse around the Right to Food, including food sovereignty in the U.S., assuming that we in this country begin to talk in real terms about what has happened to our food system domestically and how U.S. policies have impacted farmers abroad. IATP’s Farm Bill series has helped to talk about what has happened to food, people and the environment in the U.S. as a result of the deregulation in agriculture.

Although Americans are starting to wake up to our changing environment (Fast Food Nation, Omnivore's Dilemma and such) much of the U.S. public still believes in the fairytale that U.S. food comes from small family farms across the country, that we are feeding the world with our U.S. food aid programs or finally that free trade has stabilized the global food system. In fact, it is just the opposite. We know that U.S. farms have become larger and more consolidated. U.S. farmers have been forced out of agriculture in droves, and our food system and health have been negatively affected because of shifts in domestic farm policy. Much of the world has criticized the U.S. for using its food aid programs to dump overproduced grains on other markets thereby undermining local farmers abroad. And, free trade has reinforced price volatility and corporate concentration of food. Moreover, failed trade and investment policies have hurt rural communities and increased dislocation of people through forced migration.

Now we need to go a step further in 2008, developing our messages in support of alternatives. What does food sovereignty mean and why do we support it? In general terms, Food Sovereignty is the right of peoples:

• to define their own food and agriculture;
• to protect and regulate domestic agricultural production and trade in order to achieve sustainable development objectives;
• to determine the extent to which they want to be self-reliant;
• [and] to restrict the dumping of products into their markets.

Food sovereignty does not negate trade, but rather, it promotes the formulation of trade policies and practices that serve the rights of people to safe, healthy and ecologically sustainable production. ‘Statement on Peoples’ Food Sovereignty’; (Via Campesina)

To me, this is a common sense agenda around which we can all support in the U.S. and abroad.

—Alexandra Spieldoch

February 27, 2008

The Travesty of Child Labor

Mark Muller’s personal account of his work with a farmer cooperative in Honduras that uses child labor points to the complexities of this issue. As Mark suggests, there are many factors contributing to child labor, some domestic, some related to free trade. These include, but are not limited to extreme poverty, reduction in public spending in rural sectors, gender discrimination and lack of political power within communities.

But, aside from the causes, child labor is a travesty and we must all be clear on this even as we seek to address the complexities before us. IATP has always opposed child labor - whether it is in Honduras, or historically among U.S. farmworkers and elsewhere.

Certainly, the recognition of international labor standards are part of the solution. But they are only the beginning, not the end to what needs to be done to promote social well-being, fair prices for farmers and fair wages for workers, and an end to hunger and extreme poverty. Labor standards do not address the fact that current trade and investment policies are purposefully designed to exploit cheap labor and hurt producers as a means to supply cheap goods to the global market. Labor standards do not address how small countries like Honduras are destabilized, in terms of trying to meet domestic development needs and compete in the global market. Cheap labor is considered the comparative advantage. No one is excluded in this post-colonial model of slave production. Not children, not old people, and not pregnant women sweating in the fields.

We need to move beyond the judgement and fairly simplistic notions from the North about how to address social alienation and injustice. It is in our commitment to one another and to our environment that we embrace comprehensive solutions, including advocating for international treaties that support basic human rights over the market. This includes garnering international support for the UN Convention on the Rights of the Child, the UN Declaration on Human Rights and the Convention on the Elimination of Discrimination Against Women – to name a few.

I highly recommend materials posted on the web site for the International Labor Rights Forum. For many years, this organization has been doing participatory research and labor rights campaigns to lift up the rights of women and children in all parts of the world. They have looked at Honduras and taken positions on CAFTA. They are looking at abuse on the plantations and working with people on the ground. They and others have done some incredible work to highlight the complexities and to build the voices of those who are so marginalized.

The cover story on the latest issue of Forbes magazine outlines the scope of the problem: there are 218 million child laborers around the world and seven out of 10 are in agriculture. The article lists some of the challenges that communities, labor groups and corporations are facing in parts of the world where child labor is common.

IATP’s Sophia Murphy also recommends a recent report by the International Labor Organization on how to end child labor.

IATP has always embraced complexity in its broader analysis of food and farming. We can't forget the voices of children in identifying the problems as well as the solutions.

—Alexandra Spieldoch

February 25, 2008

Child Labor and Shades of Gray

IATP Senior Fellow Mark Muller is working in a volunteer program in Honduras through July. He will blog periodically on his experiences there.

“A liberal is just a conservative that hasn’t been mugged yet.”

I’ve always been bothered by that phrase, treating someone’s ideology as something that can dramatically change in a brief episode. But I have to admit that over the past several years, things that once seemed very black and white have now become several shades of gray.

Take child labor – there aren’t many issues that once seemed clearer. Children have a right to a childhood and an education. Can any form of child labor be excused?

Well last week I spent a morning working with a chili pepper producer cooperative here in southern Honduras. It’s an impressive business, where several of the community’s leaders have come together to generate an income source out of the poor soils on the incredibly eroded hillsides near the Nicaraguan border. I will be spending some time with this cooperative, and hopefully help them with some of the agronomic and marketing challenges that they are facing.

But when I arrived at the field being harvested that morning, I was taken aback by the age of some of the kids working in the fields. Many of them appeared to be about the same age as my seven year old. I have worked with farmworker families in New York State, and children have been part of the vegetable-harvesting labor force in the U.S. and most parts of the world, but this seemed to be a whole different level.
One of the directors of the cooperative must have seen the concern on my face, because he started to explain to me the rationale for children working the fields. He admitted it was illegal, but the families desperately needed the income that this work provided. He stated that a mother with children (very few men were in the fields) could earn up to 500 Lampiras (about $25) a day, much more than what is provided by other local jobs. The children are amazingly dexterous pickers, and on average they could probably pick the peppers twice as fast as I could.

Part of the reason that the work is appealing to the kids is that they get to spend their hard-earned money at the truck that serves as the mobile junk food market. Ironically, occasionally between songs blasting out of the truck radio would be a message from UNICEF alerting people that children are required to attend school.

So can I morally justify working with this cooperative? After a lot of pondering, I believe I can. First of all, if the options available to the kids were to either work the fields or to attend a well-run school where they could receive a good education, then of course they should be receiving the education. But I visited the school in the little village, and it’s hard to imagine a lot of education happening in the run down building with almost no resources. Whether the kids work the fields or not, a good education is simply not available.

Second, the kids can really earn a considerable amount of money for their family, and poverty has already taken away many of the joys of childhood. Picking vegetables is not an ideal childhood experience, but neither is drinking contaminated water or spending the day washing laundry. Despite the fact that it is hot, backbreaking work, the kids seem to make the best possible experience out of it, working next to their friends and enjoying the sugar-laden candies for sale on the truck.

I hope that, in my brief time here, I can help create some opportunities for sustainably grown, fairly traded products in this region. But without that option currently available, I have to think that some form of production and job creation is better than the alternative, which is most likely the continued migration of families away from the countryside and into overcrowded cities or to the country’s clothing factories.

Having kids myself, I can’t imagine how frustrating it is for the parents to have to rely on the labor of their children to make ends meet. Childhood labor won’t go away, though, without adequate income opportunities for the adults. And that seems to be a long ways off for many of the people here in southern Honduras.   

—Mark Muller

February 21, 2008

Clinton campaign responds to huge beef recall

Senator Hillary Clinton has responded to the animal abuse at the Hallmark/Westland slaughter house and a subsequent recall of 143 million pounds of ground beef, much of it already consumed by school children. The response reflects just how difficult it is to propose policy while responding on the campaign trail to widely publicized events. (I go into more detail on the recall in a commentary that appeared in the St. Paul Pioneer Press on Feburary 19).

Senator Clinton’s food safety plan calls for a “thorough audit of our nation’s food safety system to locate weaknesses and gaps.” While there is nothing objectionable in this proposal, the system has been audited frequently over the past 20 years by the U.S. Department of Agriculture Inspector General, by the General Accountability (then Accounting) Office, by Congressional investigators, by academics and by non-governmental organizations. Their recommendations often have been “accepted” by USDA but seldom implemented. The deregulation of the food safety system and its replacement with de facto industry self-regulation that began in the Reagan Administration continues - audits, foodborne illness, and meat product recalls notwithstanding. For example, when testing determines that a company’s product is contaminated, the company may withhold the product from further government testing that would confirm the initial test and result, at the very least, in bad publicity for the company.

Senator Clinton’s proposal to increase resources for USDA food safety funding by 50 percent echoes many similar proposals. But the problem is not just funding level but the willingness of USDA management to use the funds appropriated by Congress for their intended purpose. USDA management used previous Congressional appropriations to add management layers and commission risk assessments to justify the need for less inspection. Despite the “continuous inspection” requirement of the Meat and Poultry Inspection Act, even large volume producers like Hallmark/Westland lack federal inspectors working fulltime onsite to inspect product. Instead management instructs federal inspectors to inspect the paperwork of plant inspectors who carry out industry “self-regulation.” A new Administration would have to stand up to industry’s attempts, with USDA management cooperation, to restrict federal authority and oversight of slaughterhouses and meat processors. 

The regulatory powers of the Food and Drug Administration are even weaker than those of USDA, as the multiple import product safety incidents have demonstrated over the past year. Reorganizing U.S. food safety under a single agency, as Senator Clinton proposes, along with many others, will do little to protect consumers, and indeed, the food industry, if current industry and management practices remain prevalent. If the next Administration extends the current "lite" federal oversight of industry to all products and outsources product inspection, as proposed in November 2007 by President Bush’s Interagency Working Group report, U.S. consumers will be yet more vulnerable to product hazards. The off-shoring and outsourcing of government inspection to private organizations that would certify products as safe for export may provide plausible deniability for the government and a corporate liability shield if imports harm consumers. But the privatization of government inspection and enforcement functions is very unlikely to prevent harm to consumers, the stated goal of the report.

Senator Clinton, and indeed, all candidates for federal office, should develop well-researched food safety policies for a new Administration and a new Congress. The Clinton campaign’s effort to respond to the Hallmark/Westland animal abuse and beef product recall has merely touched the tip of a very large iceberg.

—Steve Suppan

February 04, 2008

Farmer Agreement Offers Alternative to NAFTA’s Failures

On January 1, 2008, the North American Free Trade Agreement (NAFTA) came into full effect after a 15-year phase-in for more sensitive agricultural products like sugar, white corn, beans and dairy. This means the last remaining tariffs are no longer legally binding, including those on sugar imported from Mexico to the U.S., and vice versa. Additionally, the Mexican government will no longer block imported high fructose corn syrup from the U.S., which competes directly with sugar in the Mexican sweetener markets.

The expected fallout threatens to hurt sugar farmers on both sides of the border. This threat is so dire, that it has provided an impetus for Mexican and American sugar growers to reach an historic agreement to modify the final implementation of NAFTA. 

First, let’s look at the chaos NAFTA is expected to bring to sugar markets in the U.S. and Mexico.

An expected import surge of U.S. corn syrup will likely displace Mexican sugar from the Mexican sweetener market. Mexican sugar growers also face the prospect of increased U.S sugar imports, because the current U.S. cost of production for sugar is less than in Mexico. Moreover, increased imports from other countries have created a substantial U.S. surplus of sugar that could be dumped into Mexico.

In the U.S., sugar displaced from the Mexican market by corn syrup could be exported to the U.S. This could overwhelm the delicately balanced U.S. inventory management system, already under siege by increased imports from World Trade Organization (WTO) and Central American Free Trade Agreement (CAFTA) obligations. 

All these threats taken together would likely depress sugar prices below the cost of production on both sides of the border, resulting in a shutdown of most of the North American sugar industry. 

However, there is more at stake here than the fate of an agricultural