[permaculture] [Fwd: [SANET-MG] WTO and EU are forcing farmers off the land]

Lawrence F. London, Jr. lfl at intrex.net
Thu Jul 7 23:07:48 EDT 2005

-------- Original Message --------
Subject: 	[SANET-MG] WTO and EU are forcing farmers off the land
Date: 	Thu, 7 Jul 2005 19:23:43 -0400
From: 	jcummins <jcummins at UWO.CA>


http://www.i-sis.org.uk/AWF.phpISIS Press Release 06/07/05
Agriculture without Farmers
The WTO and EU agricultural policies are sweeping farmers off the land 
in droves and threatening world food security. Rhea Gala

References to this paper are posted on ISIS members’ website. Details here

Farming has evolved over thousands of years with the farm as the basic 
unit of local community and culture. Its practice was shaped everywhere 
by geography and the creative skills of the farmer to be optimally 
productive. Since the arrival of the tractor and the industrial ‘green 
revolution’ of the 1940s, small family farms have lost out to big 
industrial farms, and much of the local knowledge accumulated over the 
millennia has disappeared

Trade policies benefit agribusiness: Small farmers everywhere are 
In industrialized countries like the UK where the population is largely 
urban, 200 000 farms have disappeared between 1966 and 1995 [1]. The 
annual UK Common Agricultural Policy budget of £3bn gives 20 percent of 
farmers (large agribusinesses) 80 percent of subsidies. Government 
figures show that 17 000 farmers and farm-workers left the land in the 
year 2003, having failed to make a living [2].

While only 5 percent of the population in the European Union (EU) are 
still farming [3], at least half a million farm-workers were still 
leaving the land annually before the EU was enlarged by 15 new members 
in May 2004. It is now likely that Poland alone will lose up to two 
million agricultural livelihoods as a result of joining the EU [1]. EU 
figures suggest that half of north European agriculture will disappear 
within a generation [4], as it continues to be squeezed out by the 
institutions that claim to give it support.

In the US, between 1950 and 1999, the number of farms decreased by 64 
percent to less than two million, and farm population has declined to 
less than 2 percent. Ninety percent of agricultural output is produced 
by only 522 000 farms [5]. Canadian statistics similarly reveal that 
farm numbers have decreased by 10 percent between the 1996 census and 
2001; there were less than 247 000 farms in the country in 2001 [6].

This relentless process of consolidation drives the heart out of the 
countryside, causing social and economic decay, and replaces it with an 
intensive industry that cares nothing about plant or animal diversity, 
quality or compassion in farming, but is solely interested in bringing 
down prices [1,7].

‘Free trade’ policies made by and for the rich countries of the North 
not only destroy the livelihood of small-farmers at home, they also 
encourage the dumping of subsidized goods (selling at less than the cost 
of production) from the North onto the markets of the poor South, 
distorting local markets, and leaving farmers in developing countries 
also unable to compete [1, 7, 8].

This has become a global scandal, as 75 percent of the population in 
China, 77 percent in Kenya, 67 percent in India, and 82 percent in 
Senegal still depend on farming for their living [3]. These numbers are 
plummeting, however, as families dispossessed of their land are driven 
to the cities, where they may find themselves unable to afford to pay 
for the food they used to grow.

Agribusiness degrades the environment while governments do nothing
‘Free trade’ policies of World Trade Organization (WTO) promote 
overproduction of agricultural commodities causing damage to wildlife, 
depleting soil, water, and fossil fuels; and at the same time 
compromising food quality, with substantial repercussions on public 
health [1,7]. They also greatly exacerbate global warming in many ways, 
not least the millions of unnecessary food-miles added to agricultural 
commodities. Professor Jules Pretty of Essex University estimated that 
the total external costs for conventional agriculture in the UK, paid 
for by the taxpayer, added up to £2.34bn for the year 1996 [9].

The UK government remains a chief obstacle in the fight against 
international poverty and environmental degradation, despite its 
seemingly green credentials on climate change, and its recent high 
profile in tackling poverty in Africa. That is because the UK continues 
to espouse an economic model that promotes privatisation and trade 
liberalisation as the key to reducing poverty and protecting the 
environment, although that model has proved to have the opposite 
effects. The UK has been at the forefront of EU efforts to push through 
an aggressive ‘free trade’ agenda at the WTO [10].

Transnational corporations (TNCs) have been allowed to gain control of 
supply chains and exert a stranglehold on global food security through a 
process of ownership of seed, proprietary chemicals, and other inputs, 
as well as virtual monopoly of food processing and retail outlets 
[2,7,11]. Yet our governments are refusing to rein in the increasing 
power of TNCs that have been swallowing each other up until only a 
handful remain.

The Agreement on Agriculture of the WTO and the Common Agricultural 
Policy (CAP) of the European Union are largely responsible for 
precipitating this global catastrophe in our food production system.

The Common Agricultural Policy of the European Union
When the EU introduced the CAP in the early 1960s, it struck a deal with 
the US under the framework of the General Agreement on Trade and Tariffs 
(GATT) negotiations. The US accepted the new border protection 
mechanisms put in place by the EU for food, in return for a commitment 
by the EU to allow unlimited import of feedstuffs from the US at zero 
tariff. The EU agreed because it was still a net importer of food and 
feedstuffs; but only 15 years later, the EU itself was producing large 
surpluses of grain and animal products as a direct result of this deal 

The zero tariff for feedstuffs enabled Europe’s huge surpluses of the 
1970s to be dumped on developing countries, creating a major global 
problem. Feedstuff imports from the US had led directly to the 
industrialization of animal production in the EU and its associated 
environmental problems [12].

The CAP, which aimed to "ensure a fair standard of living for the 
agricultural community" [2], has for many years provided direct aid to 
farmers based on area, production, and number of livestock units 
(animals) [13]. This policy gave large monocultural farms enormous 
subsidies, caused massive overproduction that lowered prices, drove 
small farmers out, and consolidated the power of agribusiness. TNCs have 
become vast selling seed, pesticide, machinery etc to farmers at great 
profit, buying produce at below the costs to farmers, and selling it on 
to consumers on a huge scale and at enormous profit [7,14].

The CAP reform of 2003 introduces a new system of single farm payments 
that ‘decouples’ the link between support and production. It comes into 
force in 2005-6 except for new member states, and its stated aim is to 
ensure greater income stability for farmers, leaving them free to decide 
what they want to produce in response to demand, without losing their 
entitlement [13]. However, this is not the effect it will have.

Farm business consultants Andersons and the National Farm Research Unit 
predict a further 30 percent decrease in British cereal growers and 
another 35 percent decrease in dairy farmers when the new single farm 
payments kick in. These payments will be lower than the previous 
payments made to smaller farms; yet prices for produce currently remain 
near or below the cost of production [14].

A survey of English farmers showed that 87 percent did not want 
subsidies, only a fair return on their costs of food production. DEFRA 
figures showed average farm income in 2002 at £10 000; with farm-gate 
prices having risen just 2 percent in the last seven years. Meanwhile, 
supermarket prices have risen by 21 percent, and in 2002-3, Tesco’s 
profits were 60 percent of total UK farming income [2].

CAP reform was also greeted with dismay abroad. NGOs such as the 
Catholic aid agency CAFOD and Oxfam said it would mean "dumping as 
usual" for developing countries [15].

CAP has positively encouraged the most senseless and environmentally 
destructive "food swaps"
Britain imported 61 400 tonnes of poultry meat from the Netherlands in 
the same year that it exported 33 100 tonnes of poultry meat to the 
Netherlands. Britain imported 240 000 tonnes of pork and 125 000 tonnes 
of lamb, while it exported 195 000 tonnes of pork and 102 000 tonnes of 
lamb [16]
In 1997, 126 million litres of liquid milk were imported into the UK and 
at the same time 270 million litres of milk were exported out of the UK. 
Twenty three thousand tonnes of milk powder were imported into the UK 
and 153,000 tonnes exported out [17]
In 1996 the UK imported 434 000 tonnes of apples, nearly half of which 
came from outside the EU. Yet over 60 percent of the UK’s own apple 
orchards have been grubbed up since 1970, largely as a result of EU 
subsidies [18]
The WTO Agreement on Agriculture
US agricultural policy has traditionally promoted cumulative growth [19] 
and privatisation of seed at taxpayer’s expense [20]. That has wrung all 
the profit out of farming and into trading, processing, and retailing, 
controlled by a few TNCs [11,19, 21]. Research shows the share of the US 
agricultural economy going to farmers declined from 41 percent in 1910 
to 9 percent in 1990, while farm input and marketing industries’ shares 
increased by a similar amount [21].

As small farmers are pushed out, others enlarge their operation, for 
example, in the US pig industry a quarter of all producers went out of 
work between 1998 and 2000, leaving just 50 businesses controlling 50 
percent of all US production. Yet, independent pig farmers produce more 
jobs, more local retail spending, and more local per capita income than 
larger corporate operations; and profits generated by small producers 
(of any commodity) are more likely to remain in the community and 
benefit the local economy [21].

As in Europe, these policies have led to low plant and animal genetic 
diversity, low prices, many failing small farms, and environmental 
degradation, and because they are geared towards maximising export, 
similar effects are spreading all over the world. Seventy percent of the 
world’s poorest people, who directly depend on the land, are forced to 
compete with the rich nations [11].

The 1996 Freedom to Farm Bill followed by the 2002 US Farm Bill produced 
a vast structural price-depressing oversupply of major agricultural 
commodities in an attempt to comply with WTO rules [19, 22]. The 
Agreement on Agriculture (AoA) came out of the Uruguay Round of the 
General Agreement on Tariffs and Trade (GATT) negotiations between the 
US and the EU (1986-94) that led to the founding of the WTO [12]. It 
provides the rules governing international agricultural trade and, by 
extension, agricultural production [8].

The AoA is based on the firm ideological belief that trade 
liberalization brings net benefits to all participants. By removing 
barriers to trade, regional specialization will increase and regions 
will specialize in whatever their agriculture can produce more cheaply 
than others. It dictates that when products are exchanged, everybody 
gains because the combined cost of production is less than if each 
region had produced its own. In practical terms, this means promoting 
exports and limiting the right of countries to follow a policy of food 
self-sufficiency [12].

The aim of the AoA is to reduce the use of the following three methods 
that favour domestic production

Border protection against imported products (the cheapest and most 
widespread method used)
Internal support measures for domestic producers (mainly used by 
developed countries with taxpayers money)
Export subsidies (used exclusively by developed countries) [12]
But the US negotiating position claims the right to spend tens of 
billions of dollars to compensate farmers for market failures rather 
than addressing those failures directly [8, 19]. In 2003, over half of 
the compensation went to less than 2 percent of farmers, again 
benefiting only very large businesses [23]. Furthermore, developed 
countries maintain the right to continue with several forms of support 
that are now illegal for any other country to introduce [12].

The US, with its chronic overproduction in major commodities, always 
needs new export markets, and its policies therefore affect production 
everywhere. For example, rice, the staple of most of the poor nations, 
is grown on around 8 000 farms in the US; half of it in Arkansas where 
the biggest 332 rice farms, each over 400 hectares in size, produce more 
rice than all the farmers of Ghana, Guinea, Guinea-Bissau, Niger, and 
Senegal combined [24].

In 2003, the US’s crop of 9m tonnes of rough rice cost farmers $1.8bn to 
produce. Farmers received only $1.5bn from rice millers, but were 
sustained by government subsidies, which totalled $1.3bn. Between 2000 
and 2003 it cost on average $415 to grow and mill one tonne of white 
rice in the US, but that rice was exported around the world for just 
$274 per tonne and dumped on developing country markets at a price 34% 
below its true cost [24].

Surpluses may also be designated ‘food aid’ and monetized, i.e., sold on 
the recipient country’s market to generate cash. Most US programme food 
aid is sold to recipient countries through concessional financing or 
export credit guarantees. The US is nearly the only country that sells 
‘food aid’ to recipient countries; other donors give it in grant form 
[25], but both strategies reduce prices both for developing country 
exporters and for smallholders in importing countries, and deepen and 
prolong the depression in world market prices [24].

Current agriculture policies undermine human rights
The WTO’s stated aims are to raise living standards, ensure full 
employment, and raise incomes; and the AoA is specifically meant to 
further the WTO’s aims by "establishing a fair and market oriented 
agricultural trade system". But a report by the Institute for 
Agriculture and Trade Policy released in March 2005 accused WTO 
agriculture policies of undermining human rights; by promoting a trade 
liberalization agenda that overrides efforts to improve livelihoods in 
four ways [26].

Promote the ‘right to export’ over human rights
Fail to tackle corporate control
Allow export dumping at artificially low prices to continue
Lock developing countries into an uneven playing field
Using data from the US Department of Agriculture and the Organization 
for Economic Cooperation and Development (2003), the report describes 
how exports from US-based global food companies were dumped onto world 
agricultural markets [22].

Wheat exported on average 28% below cost
Soybeans exported on average 10% below cost
Corn exported on average 10% below cost
Cotton exported on average 47% below cost
Rice exported on average 26% below cost
This dumping has greatly increased since the inception of the AoA [22], 
and prices have dropped to new lows [12]; but as all WTO members have 
ratified at least one of the international human rights treaties, these 
instruments could be used when designing trade policies [26].

The policies of international agribusiness
The laws that bind international trade derive from the ideology of 
international agribusiness whose common interest lies in opening up 
developing country markets. Close links with governments and academia 
are exploited to persuade policy-makers and the public that trade 
liberalization is clearly in the best interest of developing countries 

Agribusiness is at the heart of creating US trade policy, thanks to the 
Agricultural Technical Advisory Committees for Trade. Members appointed 
in 2003 were selected, according to former US Trade Representative 
Robert Zoellick [24], to "coincide with the continuation of the Bush 
Administration’s aggressive push to open foreign markets to US 
agricultural products.... Coordinating with our agricultural community 
will continue to be important as the tempo of negotiations for global, 
regional, and bilateral trade agreements intensifies."

In the US, as in many countries, there is a fast-revolving door between 
top posts in agro-industry and government; and agribusiness sits in the 
top ten of industry donors to candidates and political parties in US 
elections, contributing over $340m to campaign funds since 1990 [24].

Policies reinforce industrial agriculture at the expense of sustainable 
During this multinational bonanza, industrial agriculture and its 
policies are placing enormous stress on the world’s small farmers and 
the renewable resource base, especially water and soil. Moreover, the 
local knowledge and plant genetic diversity most needed to truly sustain 
the world are being lost. Recent research has demonstrated the 
resilience and productivity of many traditional agricultural practices 
that have withstood the test of time [7, 21,27, 28].

It has also documented the damage done when small, diverse organic 
farms, that have only one third of the hidden costs of non-organic 
agriculture [29], are pushed off the land by distorted markets, and 
replaced with large monocultures oriented towards export production [8]. 
But government policies tend to emphasize a handful of major crops that 
require large fertilizer and pesticide inputs, and ignore resource 
conserving crop rotations for which farmers receive no government 
incentives, or sustainable practices such as growing clover or alfalfa 
to enhance soil fertility. They also perpetuate chemical-intensive 
agriculture by funding research on chemical fixes for agricultural 
problems, to the exclusion of research on more sustainable options [21].

Sustainable systems are especially able to compare favorably with 
conventional systems when the comparison includes a full cost accounting 
of the environmental and public health harms and benefits of each 
system; but these costs are usually externalized, or paid by society 
rather than the polluter [21].

There needs to be dedicated support for sustainable food production by 
small farmers who have served us well for thousands of years; and a 
curbing of the power of multinationals who serve only themselves. In 
spite of spin from politicians about ‘making poverty history’, their 
trade liberalisation policies can only continue to ruin local economies 
everywhere while serving the global elites.

The International Commission on the Future of Food and Agriculture 
suggests the following changes to agricultural trade policy that would 
help make the world a much fairer and healthier place [7]:

Permit tariffs and import quotas that favour subsidiarity. This means 
that whenever production can be achieved by local farmers using local 
resources for local consumption, all rules and benefits should favour 
that option; thus shortening the distance between production and 
consumption. Trade should be confined to whatever commodities cannot be 
supplied at the local level, rather than export trade being the primary 
driver of production and distribution.
Reverse the present rules on intellectual property and patenting. These 
strongly favour the rights of global corporations to claim patents on 
medicinal plants, agricultural seeds, and other aspects of biodiversity, 
even when the biological material has been under cultivation and 
development by indigenous people or community farmers for millennia.
Localize food regulations and standards. Rules that benefit global food 
giants, such as irradiation, pasteurization, and shrink-wrapping also 
negatively affect taste and quality; and industrial processing has led 
to an increased incidence of food poisoning and diseases in farm 
animals. Each nation should be allowed to set its own high standards for 
Allow farmer marketing/supply management boards. These let farmers 
negotiate collective prices with domestic and foreign buyers to help 
ensure that they receive a fair price for their commodities. Less than 
two years after the North American Free Trade Area (that dismantled the 
government price regulation agencies) went into effect, Mexican domestic 
corn prices fell by 48% as a flood of cheap US corn exports entered the 
country. Thousands of farmers have been forced to sell their lands
Eliminate direct export subsidies and payments for corporations. 
Although the WTO has eliminated direct payment programmes for most small 
farmers, they continue to allow export subsidies to agribusinesses. For 
example, the US Overseas Private Investment Corporation funded by US 
taxpayers, provides vital insurance to US companies investing overseas. 
Even loans from the IMF to Third World countries have been channeled 
into export subsidies for US agribusiness
Recognize and eliminate the adverse effects of WTO market access rules. 
Countries need new international trade rules that allow them to 
re-introduce constraints and controls on their imports and exports. 
These would prevent heavily subsidised Northern exports from destroying 
rural communities and self-sufficient livelihoods throughout the South. 
Many people now working, for example, for poverty wages at Nike and 
other global corporate subcontractors are refugees from previously 
self-sufficient farming regions.
Promote redistributive land reform. The redistribution of land to 
landless and land-poor rural families is a priority. This has promoted 
rural welfare at different times in Japan, South Korea, Taiwan and 
China. Research shows that small farmers are more productive and more 
efficient, and contribute more to broad-based regional development than 
do the larger corporate farmers.
Come and have your say at our Sustainable World Conference in 
Westminster, London July 14-15, 2005 Details: 

The Institute of Science in Society, PO Box 32097, London NW1 OXR
telephone:   [44 20 8452 2729]   [44 20 7272 5636]

General Enquiries sam at i-sis.org.uk - Website/Mailing List 
press-release at i-sis.org.uk - ISIS Director m.w.ho at i-sis.org.uk


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