MEXICO EXPORTS CORN AND IMPOVERISHED FARMERS

Food Crisis: World Bank and IMF Warn of a Spreading Famine

By Eduardo Galeano

[This article published in: Freitag 16, April 18, 2008 is translated from the German on the World Wide Web, http://www.freitag.de/2008/16/08160501.php. Eduardo Galeano is a Uruguayan writer and author of “The Open Veins of Latin America” and “Memories of Fire.”]




Early-warning systems sound alarms everywhere. 36 countries, 21 in Africa, face an acute hunger crisis. At its spring 2008 meeting, the World Bank predicted a social chaos for Nigeria, Burkina Faso, the Ivory Coast, Haiti, Chechnya, Armenia and Indonesia. If the prices for food should soar dramatically –the increase was 40 percent on average in 2007 -, the situation will be out of control.

Every day the mammoth media give us encouraging statistics about the so-called international war on terror and poverty. Poverty is in retreat, it says, although the poor once again are badly informed – and know nothing of this good news. Now the best-paid bureaucrats of the world – they work in the International Monetary Fund and the World Bank – suddenly admit they were also badly informed themselves.

They issue retreats of their programs for international statistical comparisons and a few little corrections of their past reports. Now they tell us they gave 500 million more to the poorest of the world’s poor than previously announced.

We also learn that the poor countries Ethiopia, Bangladesh, Haiti, Mozambique, Somalia and Indonesia are much poorer than reported in earlier statistics and that their misery increased while the World bank sold them “free market pills.”

As though this were not enough, the extent of inequality between poor and rich was also measured incorrectly. In many states, the abyss is much deeper than in Brazil which in the past was regarded as an especially frightening example.

At the same time Joseph Stiglitz, ex-vice-president of the World Bank, analyzed the costs of the Iraq war. President Bush had announced the crusade or campaign would cost at most $50 billion, a seemingly acceptable price for conquering a country with so much crude oil. In the meantime, the blood-bath between Kirkuk, Bagdad and Basra has already lasted over five years. The US has spent a trillion dollars for killing innocent civilians.

When George W. Bush was still in the infancy of his presidency, he asked his fellow-citizens on July 27, 2001: “Can you imagine a country unable to produce enough food to supply its own population? Such a country would be exposed to great international pressure. That nation would be in danger. Therefore American agriculture is a matter of national security.”

The president did not lie. He didn’t lack logic when he defended fantastic incentive programs for the fields and plantations of his country.

What George W. Bush wanted to say about the production of food on July 27, 2001 is re-enacted in the example of Mexico. After the free trade agreement with the US and Canada was renewed and signed in 2007, the country has not produced enough food to supply its own population. Mexico became a state exposed to “great international pressure” with its national security in great danger.

Food that Mexico could have easily produced itself must be purchased for ten billion dollars every year from the US alone. Every kind of competition is prevented thanks to the protectionism practiced by the US administration. As a result, Mexican tortillas are only Mexican because they are eaten by Mexicans. The corn from which they are made is imported from the US. Corn in the US is promoted through subsidies and genetically manipulated. Today Mexico can offer ruined farmers as its most import export article. They immigrate into the North to survive. The free trade agreement had promised them prosperity.

Only a few countries can defend themselves and their agricultural markets. They are the rich countries. Others – the majority – are trained to labor on their own ruin.

HARVESTING FOR BIO-FUEL – SUGAR CANE, SOY AND PALM OIL

From September 2007 to April 2008, the prices for corn, wheat and rice soared 40 to 50 percent on average = according to data of the UN Food Organization (FAO). Beside a higher demand from India and China, the FAO assigned responsibility to an expanding production of bio-fuels. As much grain as a person needs to eat all year is consumed for 100 liters of bio-fuel.

Industrial states rely on this source of energy. The necessary raw materials come mostly from developing countries – sugar cane and soy from Brazil, cocoa from Columbia and palm oil from Indonesia and Thailand. The acreage for palm oil alone has doubled worldwide since 1990 to 130,000 square kilometers – the size of Austria and Switzerland. With 800,000 tons, Germany is the fifth largest palm oil importer.

TORTILLA CRISIS IN MEXICO – CORN FOR THE GAS TANK

Tens of thousands demonstrated in February/March 2007 in Mexico City because the price for corn (from which tortillas are made) skyrocketed two-thirds in only one year. They demanded state controls for basic foods and a withdrawal from the free trade agreement NAFTA that allows tariff-free trade between Canada, the US and Mexico. The massive grain demand from North America for production of bio-ethanol affects the tortilla price. The Calderon government finally ended the crisis by ordering a maximum price for corn meal.

FOOD SUPPLY AS AN OBJECT OF SPECULATION

Given the desolate situation on the international financial markets, hedge-funds and pension-funds are feverishly seeking new investment possibilities on the agricultural- and food markets. These money streams force up prices. Prices for food, particularly agricultural raw materials, depends on decisions of large American pension funds whether to enter this market with a billion dollars or more. The prices do not only depend on harvests or supply and demand.

THE UN IN 2000: CUT THE NUMBER OF POOR IN HALF

In September 2000, the UN resolved at its millennium summit in New York “not to spare any effort to free our fellow human beings – men, women and children – from the wretched and dehumanizing conditions of extreme poverty in which more than a billion are caught.” The UN saw transparent financial-, money and trading systems as necessary. In the future, trade should be an “open, fair and multilateral system.” All this peaks in the intention to cut the number of persons in half by 2015 that have to live with only a dollar a day. This intention was proclaimed as the goal of all UN member states.