tag:www.globallabour.info,2008:/en//1 2008-07-28T17:55:02Z Movable Type 3.32 tag:www.globallabour.info,2008:/en//1.293 2008-07-09T13:01:04Z 2008-07-09T13:07:28Z

Working Life is a community of people who want to discuss, share ideas and exchange information and stories about work, the economy and labor: "We are building a community that communicates with the written word, audio and video. Vigorous opinions are encouraged." Working Life is a project of Labor Research Association, a New York City-based labor advocacy organization established in 1927. ]]> tag:www.globallabour.info,2008:/en//1.294 2008-07-09T18:50:06Z 2008-07-09T19:00:59Z

Socialist Register was founded by Ralph Miliband and John Saville in London in 1964 as an annual survey of movements and ideas in the particular historical context of the British New Left. Each annual volume is constructed around a particular topical theme. The Register’s critical perspective on the contradictions that led to the demise of communist regimes as well as social democracy and the dynamics of trade union mobilization, have guided the journal’s approach to exploring the possibilities of socialist renewal, strategies of ‘structural reform’ and radical democratization. It is one of the few socialist journals in the English language that involves a broad international spectrum of contributors. ]]> tag:www.globallabour.info,2008:/en//1.295 2008-07-10T10:12:48Z 2008-07-10T10:17:07Z

IUF website 28-Apr-2008 . "Often we are seeing food on the shelves but people being unable to afford it." United Nations' World Food Program Executive Director Josette Sheeran on "The new face of hunger" "Producing biofuels today is a crime against humanity." Jean Ziegler, UN Special Rapporteur on the Right to Food "I see so much focus on food, and it seems to be so trendy in the investment world…The markets seem to me to have a bubble-like quality." Goldman Sachs chief economist Jim O'Neill Some 16 months after tens of thousands of Mexicans took to the streets to protest a four-fold increase in the price of tortillas (flat maize bread that is the country's staple food), politicians and international agencies have woken up to the enormity of the global food crisis. From Argentina to Yemen, Bolivia to Uzbekistan, food riots are spreading across the globe. The FAO warns that global food reserves are at their lowest in 25 years, and says that with prices set to rise still further food riots will become a general phenomenon over the next year. The IMF now speaks of 100 million potential new victims of starvation. What is powering the 90% overall rise in global food prices over the past three years, the doubling of wheat prices in less than a year and similarly dramatic increases in the prices of other grains and edible oils over the past year? One putative explanation has been recycled with such frequency by politicians, industry, journalists and even the Director General of the United Nations' Food and Agriculture Organization (FAO) that it has all but escaped critical examination. We have been repeatedly told that escalating food prices are the result of rising demand in developing countries, whose growing consumption of meat and milk is driving prices rapidly upwards. Rising demand for animal-based protein, however, has been steady rather than explosive. It cannot explain the 31% increase in the price of rice which occurred in the closing days of March alone, or the 400% increase in the price of Mexican tortillas. India, hard hit by the rising cost of rice, produced record harvests of rice, wheat and oilseeds in 2007/8. Mexico exported maize in 2006; 2007 saw record levels of production in Mexico, in the region and globally. The other conventional explanation for sharp, rapid food price inflation - climate change-related pressure on arable land and water resources - likewise fails to fit the facts, though the problem is real and requires urgent action. Australia's poor grain harvest as a result of drought is reckoned to have added no more than 1.5% to global wheat prices. It is unquestionably the diversion of food crops to biofuel production which has reduced world food stocks to dangerously low levels and is driving the increased prices which have transformed basic food into a luxury for the world's rural and urban poor. Biofuels made from food and feed crops include ethanol made from maize (corn), cane sugar, beet sugar and wheat, and biodiesel made from soybeans, sunflower oil, palm oil, rapeseed (canola) and other plants. From 20 to 50 percent of feedstocks in major producing countries, and in particular maize and rapeseed, are now filling fuel tanks rather than stomachs. This in turn has driven up the price of soybeans, an important global protein source, and dragged with it meat, dairy and other food prices. Corporate hunger for biofuels, not growing demand for more varied protein in developing countries, is what is aggressively driving up the cost of food. The maize currently feeding US ethanol production is sufficient to meet the current needs of all the FAO's low-income food-deficit countries - and the United States has mandated a five-fold increase in ethanol production. If the entire US maize output, rather than last year's 20%, were diverted to ethanol, it would still only replace 7% of current US petroleum consumption. It has been estimated that for domestic production to meet the EU's mandatory targets for biofuels in road transport, half the EU's arable land would have to be devoted to non-food production. Indonesia is encouraging a 400% increase in palm oil production over the coming decade. These policies will have catastrophic social, environmental and climatic consequences. It has been repeatedly claimed that switching to biofuels will protect the environment. However when all the inputs and outputs are adequately taken into account, the energy (most of it petroleum-derived) required to produce a given unit of biofuel is considerably greater than that contained in the biofuel itself. Some of the proposed "second generation" biofuel sources (like cellulosic biomass from trees whose cultivation would replace food crops) are even more avid consumers of energy. Factor in increased pressure on water and land (for example destroying the tropical forests which are the planet's carbon sinks) for expanded oil palm and soy production, and the biofuel contribution to reversing global warming is sharply negative. Expanding biofuel production means more, not less, greenhouse gas emissions. While food riots and the threat of mass starvation have begun to shake optimistic forecasts of reversing climate change through biofuels, two other critical factors have largely escaped notice, as if the biofuel boom were taking place in the pure environment of a laboratory greenhouse. First, the promotion of biofuels through subsidies and other measures takes place in the context of extremely high concentration along the supply chain. Two companies, Cargill and ADM, distribute the vast bulk of the world's internationally traded maize and other grains. A handful of TNCs dominate global sugar production and trade. Equally high levels of concentration often exist at national level. One company, Mexico's Grupo Gruma, controls over three-quarters of the country's market for tortilla flour. Their concentrated buying power is what sets benchmark prices. Second, record amounts of money have been flowing into agricultural commodity markets in recent years, accelerating even more rapidly as investors fleeing meltdown in the credit markets seek new outlets. Speculative capital has hitched itself to the food commodity boom, creating a classic "asset bubble". Food processing companies have also devoted increasing financial resources to these same markets, potentially adding to the upward pressure on prices without fundamentally affecting the diversion of grains from food to energy. If the precise contribution of speculation, hedging and old-fashioned hoarding to food price inflation cannot, at present, be precisely determined, it is because few of the agencies suddenly alert to the food crisis have even asked the question. This in turn has important implications for policy proposals to deal with the crisis. Getting a grip on food price inflation means confronting the concentrated power of the agrofood TNCs and reining in speculative finance. World Bank chief Zoellick has raised the spectre of mass starvation to call for a "New Deal" for agriculture - administered by the IMF and World Bank. The New Deal, however, looks suspiciously like the old. Together with the WTO, the international lending agencies have promoted and enforced a world food system dominated by a handful of giant corporations whose power and reach are built on production systems geared to massive export at the expense of domestic food-producing capacity. Global food riots are proof that feeding hungry corporations is not identical to feeding human beings. Rather than calling on the institutions which brought about the crisis to resolve it, trade unions, together with civil society organizations, must demand a public investigation by the United Nations into the surge in the cost of basic food. While the role of the FAO in tackling the crisis is generally acknowledged, the FAO's record is on many counts ambiguous: it too has promoted export-based industrialized farming at the expense of food security and social and environmental sustainability. If the UN is to take a lead in developing policies and measures to address the crisis, there must be formal participation by the UN Special Rapporteur on the Right to Food, along with UNCTAD, the UN agency with the most experience of international commodity markets, and the ILO, the only UN agency in which trade unions have an institutional voice. Given the enormity of the crisis, the WTO's Agreement on Agriculture must be suspended to give governments the policy space they need for measures to tackle the crisis. Regulating imports, limiting or even halting exports, the imposition of tariffs/taxes, and production subsidies to satisfy domestic food (not biofuel) requirements must be considered legitimate measures to defend food security, which take precedence over the rules of the WTO. Governments of major food staple exporting countries should be required to furnish the World Food Program with stocks at below market prices or the equivalent in cash to allow food-deficit governments to buy supplies from appropriate sources at subsidized prices. Priority must be given to raising funds for an international program to strengthen systems of local and national food production. Since food price inflation is an aggressive tax on the poor, who in developing countries devote most of their income to food, taxing the record profits of the grain trading and processing TNCs would be a legitimate means of partially financing the reconstruction of agriculture. And unions should seek to implement the recent decision of the IUF Executive Committee, which, meeting in Geneva April 17 to 18, called for a moratorium on the expansion of biofuel production pending a full assessment of the social, employment and environmental impact. Food rights - the right of all to affordable nutritious food, and rights for those who produce the world's food - must be at the heart of global food policy. ]]> tag:www.globallabour.info,2008:/en//1.296 2008-07-10T10:28:11Z 2008-07-10T11:18:53Z

From: The Bullet, e-bulletin of the Socialist Project, No. 102, April 28, 2006 Ian Angus is the editor of Climate and Capitalism -------------------------------------------------------------------------------- ‘The greatest demonstration of the historical failure of the capitalist model’ “If the government cannot lower the cost of living it simply has to leave. If the police and UN troops want to shoot at us, that's OK, because in the end, if we are not killed by bullets, we'll die of hunger.” – A demonstrator in Port-au-Prince, Haiti In Haiti, where most people get 22% fewer calories than the minimum needed for good health, some are staving off their hunger pangs by eating “mud biscuits” made by mixing clay and water with a bit of vegetable oil and salt.[1] Meanwhile, in Canada, the federal government is currently paying $225 for each pig killed in a mass cull of breeding swine, as part of a plan to reduce hog production. Hog farmers, squeezed by low hog prices and high feed costs, have responded so enthusiastically that the kill will likely use up all the allocated funds before the program ends in September. Some of the slaughtered hogs may be given to local Food Banks, but most will be destroyed or made into pet food. None will go to Haiti. This is the brutal world of capitalist agriculture – a world where some people destroy food because prices are too low, and others literally eat dirt because food prices are too high. Record prices for staple foods We are in the midst of an unprecedented worldwide food price inflation that has driven prices to their highest levels in decades. The increases affect most kinds of food, but in particular the most important staples – wheat, corn, and rice. The UN Food and Agriculture Organization says that between March 2007 and March 2008 prices of cereals increased 88%, oils and fats 106%, and dairy 48%. The FAO food price index as a whole rose 57% in one year – and most of the increase occurred in the past few months. Another source, the World Bank, says that that in the 36 months ending February 2008, global wheat prices rose 181% and overall global food prices increased by 83%. The Bank expects most food prices to remain well above 2004 levels until at least 2015. The most popular grade of Thailand rice sold for $198 a tonne five years ago and $323 a tonne a year ago. On April 24, the price hit $1,000. Increases are even greater on local markets – in Haiti, the market price of a 50 kilo bag of rice doubled in one week at the end of March. These increases are catastrophic for the 2.6 billion people around the world who live on less than US$2 a day and spend 60% to 80% of their incomes on food. Hundreds of millions cannot afford to eat. This month, the hungry fought back. Taking to the streets In Haiti, on April 3, demonstrators in the southern city of Les Cayes built barricades, stopped trucks carrying rice and distributed the food, and tried to burn a United Nations compound. The protests quickly spread to the capital, Port-au-Prince, where thousands marched on the presidential palace, chanting “We are hungry!” Many called for the withdrawal of UN troops and the return of Jean-Bertrand Aristide, the exiled president whose government was overthrown by foreign powers in 2004. President René Préval, who initially said nothing could be done, has announced a 16% cut in the wholesale price of rice. This is at best a stop-gap measure, since the reduction is for one month only, and retailers are not obligated to cut their prices. The actions in Haiti paralleled similar protests by hungry people in more than twenty other countries. In Burkino Faso, a two-day general strike by unions and shopkeepers demanded “significant and effective” reductions in the price of rice and other staple foods. In Bangladesh, over 20,000 workers from textile factories in Fatullah went on strike to demand lower prices and higher wages. They hurled bricks and stones at police, who fired tear gas into the crowd. The Egyptian government sent thousands of troops into the Mahalla textile complex in the Nile Delta, to prevent a general strike demanding higher wages, an independent union, and lower prices. Two people were killed and over 600 have been jailed. In Abidjan, Côte d’Ivoire, police used tear gas against women who had set up barricades, burned tires and closed major roads. Thousands marched to the President’s home, chanting “We are hungry,” and “Life is too expensive, you are killing us.” In Pakistan and Thailand, armed soldiers have been deployed to prevent the poor from seizing food from fields and warehouses. Similar protests have taken place in Cambodia, Cameroon, Ethiopia, Honduras, Indonesia, Madagascar, Mauritania, Niger, Peru, Philippines, Senegal, Thailand, Uzbekistan, and Zambia. On April 2, the president of the World Bank told a meeting in Washington that there are 33 countries where price hikes could cause social unrest. A Senior Editor of Time magazine warned: “The idea of the starving masses driven by their desperation to take to the streets and overthrow the ancien regime has seemed impossibly quaint since capitalism triumphed so decisively in the Cold War.... And yet, the headlines of the past month suggest that skyrocketing food prices are threatening the stability of a growing number of governments around the world. …. when circumstances render it impossible to feed their hungry children, normally passive citizens can very quickly become militants with nothing to lose.”[2] What’s Driving Food Inflation? Since the 1970s, food production has become increasingly globalized and concentrated. A handful of countries dominate the global trade in staple foods. 80% of wheat exports come from six exporters, as does 85% of rice. Three countries produce 70% of exported corn. This leaves the world’s poorest countries, the ones that must import food to survive, at the mercy of economic trends and policies in those few exporting companies. When the global food trade system stops delivering, it’s the poor who pay the price. For several years, the global trade in staple foods has been heading towards a crisis. Four related trends have slowed production growth and pushed prices up. The End of the Green Revolution: In the 1960s and 1970s, in an effort to counter peasant discontent in southeast Asia, the U.S. poured money and technical support into agricultural development in India and other countries. The “green revolution” – new seeds, fertilizers, pesticides, agricultural techniques and infrastructure – led to spectacular increases in food production, particularly rice. Yield per hectare continued expanding until the 1990s. Today, it’s not fashionable for governments to help poor people grow food for other poor people, because “the market” is supposed to take care of all problems. The Economist reports that “spending on farming as a share of total public spending in developing countries fell by half between 1980 and 2004.”[3] Subsidies and R&D money have dried up, and production growth has stalled. As a result, in seven of the past eight years the world consumed more grain than it produced, which means that rice was being removed from the inventories that governments and dealers normally hold as insurance against bad harvests. World grain stocks are now at their lowest point ever, leaving very little cushion for bad times. Climate Change: Scientists say that climate change could cut food production in parts of the world by 50% in the next 12 years. But that isn’t just a matter for the future: Australia is normally the world’s second-largest exporter of grain, but a savage multi-year drought has reduced the wheat crop by 60% and rice production has been completely wiped out. In Bangladesh in November, one of the strongest cyclones in decades wiped out a million tonnes of rice and severely damaged the wheat crop, making the huge country even more dependent on imported food. Other examples abound. It’s clear that the global climate crisis is already here, and it is affecting food. Agrofuels: It is now official policy in the U.S., Canada and Europe to convert food into fuel. U.S. vehicles burn enough corn to cover the entire import needs of the poorest 82 countries.[4] Ethanol and biodiesel are very heavily subsidized, which means, inevitably, that crops like corn (maize) are being diverted out of the food chain and into gas tanks, and that new agricultural investment worldwide is being directed towards palm, soy, canola and other oil-producing plants. This increases the prices of agrofuel crops directly, and indirectly boosts the price of other grains by encouraging growers to switch to agrofuel. As Canadian hog producers have found, it also drives up the cost of producing meat, since corn is the main ingredient in North American animal feed. Oil Prices: The price of food is linked to the price of oil because food can be made into a substitute for oil. But rising oil prices also affect the cost of producing food. Fertilizer and pesticides are made from petroleum and natural gas. Gas and diesel fuel are used in planting, harvesting and shipping.[5] It’s been estimated that 80% of the costs of growing corn are fossil fuel costs – so it is no accident that food prices rise when oil prices rise. * * * By the end of 2007, reduced investment in the third world, rising oil prices, and climate change meant that production growth was slowing and prices were rising. Good harvests and strong export growth might have staved off a crisis – but that isn’t what happened. The trigger was rice, the staple food of three billion people. Early this year, India announced that it was suspending most rice exports in order to rebuild its reserves. A few weeks later, Vietnam, whose rice crop was hit by a major insect infestation during the harvest, announced a four-month suspension of exports to ensure that enough would be available for its domestic market. India and Vietnam together normally account for 30% of all rice exports, so their announcements were enough to push the already tight global rice market over the edge. Rice buyers immediately started buying up available stocks, hoarding whatever rice they could get in the expectation of future price increases, and bidding up the price for future crops. Prices soared. By mid-April, news reports described “panic buying” of rice futures on the Chicago Board of Trade, and there were rice shortages even on supermarket shelves in Canada and the U.S. Why the rebellion? There have been food price spikes before. Indeed, if we take inflation into account, global prices for staple foods were higher in the 1970s than they are today. So why has this inflationary explosion provoked mass protests around the world? The answer is that since the 1970s the richest countries in the world, aided by the international agencies they control, have systematically undermined the poorest countries’ ability to feed their populations and protect themselves in a crisis like this. Haiti is a powerful and appalling example. Rice has been grown in Haiti for centuries, and until twenty years ago Haitian farmers produced about 170,000 tonnes of rice a year, enough to cover 95% of domestic consumption. Rice farmers received no government subsidies, but, as in every other rice-producing country at the time, their access to local markets was protected by import tariffs. In 1995, as a condition of providing a desperately needed loan, the International Monetary Fund required Haiti to cut its tariff on imported rice from 35% to 3%, the lowest in the Caribbean. The result was a massive influx of U.S. rice that sold for half the price of Haitian-grown rice. Thousands of rice farmers lost their lands and livelihoods, and today three-quarters of the rice eaten in Haiti comes from the U.S.[6] U.S. rice didn’t take over the Haitian market because it tastes better, or because U.S. rice growers are more efficient. It won out because rice exports are heavily subsidized by the U.S. government. In 2003, U.S. rice growers received $1.7 billion in government subsidies, an average of $232 per hectare of rice grown.[7] That money, most of which went to a handful of very large landowners and agribusiness corporations, allowed U.S. exporters to sell rice at 30% to 50% below their real production costs. In short, Haiti was forced to abandon government protection of domestic agriculture – and the U.S. then used its government protection schemes to take over the market. There have been many variations on this theme, with rich countries of the north imposing “liberalization” policies on poor and debt-ridden southern countries and then taking advantage of that liberalization to capture the market. Government subsidies account for 30% of farm revenue in the world’s 30 richest countries, a total of US$280 billion a year,[8] an unbeatable advantage in a “free” market where the rich write the rules. The global food trade game is rigged, and the poor have been left with reduced crops and no protections. In addition, for several decades the World Bank and International Monetary Fund have refused to advance loans to poor countries unless they agree to “Structural Adjustment Programs” (SAP) that require the loan recipients to devalue their currencies, cut taxes, privatize utilities, and reduce or eliminate support programs for farmers. All this was done with the promise that the market would produce economic growth and prosperity – instead, poverty increased and support for agriculture was eliminated. “The investment in improved agricultural input packages and extension support tapered and eventually disappeared in most rural areas of Africa under SAP. Concern for boosting smallholders' productivity was abandoned. Not only were governments rolled back, foreign aid to agriculture dwindled. World Bank funding for agriculture itself declined markedly from 32% of total lending in 1976-8 to 11.7% in 1997-9.”[9] During previous waves of food price inflation, the poor often had at least some access to food they grew themselves, or to food that was grown locally and available at locally set prices. Today, in many countries in Africa, Asia and Latin America, that’s just not possible. Global markets now determine local prices – and often the only food available must be imported from far away. Food is not just another commodity – it is absolutely essential for human survival. The very least that humanity should expect from any government or social system is that it try to prevent starvation – and above all that it not promote policies that deny food to hungry people. That’s why Venezuelan president Hugo Chavez was absolutely correct on April 24, to describe the food crisis as “the greatest demonstration of the historical failure of the capitalist model.” What needs to be done to end this crisis, and to ensure that doesn’t happen again? Part Two of this article will examine those questions. -------------------------------------------------------------------------------- Footnotes 1. Kevin Pina. “Mud Cookie Economics in Haiti.” Haiti Action Network, Feb. 10, 2008. www.haitiaction.net/News/HIP/2_10_8/2_10_8.html 2. Tony Karon. “How Hunger Could Topple Regimes.” Time, April 11, 2008. www.time.com/time/world/article/0,8599,1730107,00.html 3. “The New Face of Hunger.” The Economist, April 19, 2008. 4. Mark Lynas. "How the Rich Starved the World." New Statesman, April 17, 2008. www.newstatesman.com/200804170025 5. Dale Allen Pfeiffer. Eating Fossil Fuels. New Society Publishers, Gabriola Island BC, 2006. p. 1 6. Oxfam International Briefing Paper, April 2005. "Kicking Down the Door." www.oxfam.org/en/files/bp72_rice.pdf 7. Ibid. 8. OECD Background Note: Agricultural Policy and Trade Reform. www.oecd.org/dataoecd/52/23/36896656.pdf 9. Kjell Havnevik, Deborah Bryceson, Lars-Erik Birgegård, Prosper Matondi & Atakilte Beyene. "African Agriculture and the World Bank: Development or Impoverishment?" Links International Journal of Socialist Renewal, www.links.org.au/node/328 . ]]> tag:www.globallabour.info,2008:/en//1.297 2008-07-10T10:57:46Z 2008-07-10T11:14:50Z

From: The Bullet, e-bulletin of the Socialist Project, No. 107, May 12, 2008 Ian Angus is editor of Climate and Capitalism. Part One of this article was published in The Bullet, No. 102 on April 28, 2008. -------------------------------------------------------------------------------- Capitalism, Agribusiness and the Food Sovereignty Alternative . No shortage of food The starting point for our analysis must be this: there is no shortage of food in the world today. Contrary to the 18th century warnings of Thomas Malthus and his modern followers, study after study shows that global food production has consistently outstripped population growth, and that there is more than enough food to feed everyone. According to the United Nations Food and Agriculture Organization, enough food is produced in the world to provide over 2800 calories a day to everyone — substantially more than the minimum required for good health. That’s about 18% more calories per person than in the 1960s, despite a significant increase in total population.[1] As the Food First Institute points out, “abundance, not scarcity, best describes the supply of food in the world today.”[2] Despite that, the most commonly proposed solution to world hunger is new technology to increase food production. The Alliance for a Green Revolution in Africa, funded by the Bill and Melinda Gates Foundation and the Rockefeller Foundation, aims to develop “more productive and resilient varieties of Africa’s major food crops … to enable Africa’s small-scale farmers to produce larger, more diverse and reliable harvests.”[3] Similarly, the Manila-based International Rice Research Institute has initiated a public-private partnership “to increase rice production across Asia via the accelerated development and introduction of hybrid rice technologies.”[4] And the president of the World Bank promises to help developing countries gain “access to technology and science to boost yields.”[5] Scientific research is vitally important to the development of agriculture, but initiatives that assume in advance that new seeds and chemicals are needed are neither credible nor truly scientific. The fact that there is already enough food to feed the world shows that the food crisis is not a technical problem — it is a social and political problem. Rather than asking how to increase production, our first question should be why, when so much food is available, are over 850 million people hungry and malnourished? Why do 18,000 children die of hunger every day? Why can’t the global food industry feed the hungry? The profit system The answer can be stated in one sentence. The global food industry is not organized to feed the hungry; it is organized to generate profits for corporate agribusiness. The agribusiness giants are achieving that objective very well indeed. This year, agribusiness profits are soaring above last year’s levels, while hungry people from Haiti to Egypt to Senegal were taking to the streets to protest rising food prices. These figures are for just three months at the beginning of 2008.[6] Grain Trading Archer Daniels Midland (ADM). Gross profit: $1.15 billion, up 55% from last year Cargill: Net earnings: $1.03 billion, up 86% Bunge. Consolidated gross profit: $867 million, up 189%. Seeds & herbicides Monsanto. Gross profit: $2.23 billion, up 54%. Dupont Agriculture and Nutrition. Pre-tax operating income: $786 million, up 21% Fertilizer Potash Corporation. Net income: $66 million, up 185.9% Mosaic. Net earnings: $520.8 million, up more than 1,200% The companies listed above, plus a few more, are the monopoly or near-monopoly buyers and sellers of agricultural products around the world. Six companies control 85% of the world trade in grain; three control 83% of cocoa; three control 80% of the banana trade.[7] ADM, Cargill and Bunge effectively control the world’s corn, which means that they alone decide how much of each year’s crop goes to make ethanol, sweeteners, animal feed or human food. As the editors of Hungry for Profit write, “The enormous power exerted by the largest agribusiness/food corporations allows them essentially to control the cost of their raw materials purchased from farmers while at the same time keeping prices of food to the general public at high enough levels to ensure large profits.”[8] Over the past three decades, transnational agribusiness companies have engineered a massive restructuring of global agriculture. Directly through their own market power and indirectly through governments and the World Bank, IMF and World Trade Organization, they have changed the way food is grown and distributed around the world. The changes have had wonderful effects on their profits, while simultaneously making global hunger worse and food crises inevitable. The assault on traditional farming Today’s food crisis doesn’t stand alone: it is a manifestation of a farm crisis that has been building for decades. As we saw in Part One of this article, over the past three decades the rich countries of the north have forced poor countries to open their markets, then flooded those markets with subsidized food, with devastating results for Third World farming. But the restructuring of global agriculture to the advantage of agribusiness giants didn’t stop there. In the same period, southern countries were convinced, cajoled and bullied into adopting agricultural policies that promote export crops rather than food for domestic consumption, and favour large-scale industrial agriculture that requires single-crop (monoculture) production, heavy use of water, and massive quantities of fertilizer and pesticides. Increasingly, traditional farming, organized by and for communities and families, has been pushed aside by industrial farming organized by and for agribusinesses. That transformation is the principal obstacle to a rational agriculture that could eliminate hunger. The focus on export agriculture has produced the absurd and tragic result that millions of people are starving in countries that export food. In India, for example, over one-fifth of the population is chronically hungry and 48% of children under five years old are malnourished. Nevertheless, India exported US$1.5 billion worth of milled rice and $322 million worth of wheat in 2004.[9] In other countries, farmland that used to grow food for domestic consumption now grows luxuries for the north. Colombia, where 13% of the population is malnourished, produces and exports 62% of all cut flowers sold in the United States. In many cases the result of switching to export crops has produced results that would be laughable if they weren’t so damaging. Kenya was self-sufficient in food until about 25 years ago. Today it imports 80% of its food — and 80% of its exports are other agricultural products.[10] The shift to industrial agriculture has driven millions of people off the land and into unemployment and poverty in the immense slums that now surround many of the world’s cities. The people who best know the land are being separated from it; their farms enclosed into gigantic outdoor factories that produce only for export. Hundreds of millions of people now must depend on food that’s grown thousands of miles away because their homeland agriculture has been transformed to meet the needs of agribusiness corporations. As recent months have shown, the entire system is fragile: India’s decision to rebuild its rice stocks made food unaffordable for millions half a world away. If the purpose of agriculture is to feed people, the changes to global agriculture in the past 30 years make no sense. Industrial farming in the Third World has produced increasing amounts of food, but at the cost of driving millions off the land and into lives of chronic hunger — and at the cost of poisoning air and water, and steadily decreasing the ability of the soil to deliver the food we need. Contrary to the claims of agribusiness, the latest agricultural research, including more than a decade of concrete experience in Cuba, proves that small and mid-sized farms using sustainable agroecological methods are much more productive and vastly less damaging to the environment than huge industrial farms.[11] Industrial farming continues not because it is more productive, but because it has been able, until now, to deliver uniform products in predictable quantities, bred specifically to resist damage during shipment to distant markets. That’s where the profit is, and profit is what counts, no matter what the effect may be on earth, air, and water — or even on hungry people. Fighting for food sovereignty The changes imposed by transnational agribusiness and its agencies have not gone unchallenged. One of the most important developments in the past 15 years has been the emergence of La Vía Campesina (Peasant Way), an umbrella body that encompasses more than 120 small farmers’ and peasants’ organizations in 56 countries, ranging from the Landless Rural Workers Movement (MST) in Brazil to the National Farmers Union in Canada. La Vía Campesina initially advanced its program as a challenge to the “World Food Summit,” a 1996 UN-organized conference on global hunger that was attended by official representatives of 185 countries. The participants in that meeting promised (and subsequently did nothing to achieve) the elimination of hunger and malnutrition by guaranteeing “sustainable food security for all people.”[12] As is typical of such events, the working people who are actually affected were excluded from the discussions. Outside the doors, La Vía Campesina proposed food sovereignty as an alternative to food security. Simple access to food is not enough, they argued: what’s needed is access to land, water, and resources, and the people affected must have the right to know and to decide about food policies. Food is too important to be left to the global market and the manipulations of agribusiness: world hunger can only be ended by re-establishing small and mid-sized family farms as the key elements of food production.[13] The central demand of the food sovereignty movement is that food should be treated primarily as a source of nutrition for the communities and countries where it is grown. In opposition to free-trade, agroexport policies, it urges a focus on domestic consumption and food self-sufficiency. Contrary to the assertions of some critics, food sovereignty is not a call for economic isolationism or a return to an idealized rural past. Rather, it is a program for the defense and extension of human rights, for land reform, and for protection of the earth against capitalist ecocide. In addition to calling for food self-sufficiency and strengthening family farms, La Vía Campesina’s original call for food sovereignty included these points: Guarantee everyone access to safe, nutritious and culturally appropriate food in sufficient quantity and quality to sustain a healthy life with full human dignity. Give landless and farming people — especially women — ownership and control of the land they work and return territories to indigenous peoples. Ensure the care and use of natural resources, especially land, water and seeds. End dependence on chemical inputs, on cash-crop monocultures and intensive, industrialized production. Oppose WTO, World Bank and IMF policies that facilitate the control of multinational corporations over agriculture. Regulate and tax speculative capital and enforce a strict Code of Conduct on transnational corporations. End the use of food as a weapon. Stop the displacement, forced urbanization and repression of peasants. Guarantee peasants and small farmers, and rural women in particular, direct input into formulating agricultural policies at all levels.[14] La Vía Campesina’s demand for food sovereignty constitutes a powerful agrarian program for the 21st century. Labour and left movements worldwide should give full support to it and to the campaigns of working farmers and peasants for land reform and against the industrialization and globalization of food and farming. Stop the war on Third World farmers Within that framework, we in the global north can and must demand that our governments stop all activities that weaken or damage Third World farming. Stop using food for fuel. La Vía Campesina has said it simply and clearly: “Industrial agrofuels are an economic, social and environmental nonsense. Their development should be halted and agricultural production should focus on food as a priority.”[15] Cancel Third World debts. On April 30, Canada announced a special contribution of C$10 million for food relief to Haiti.[16] That’s positive – but during 2008 Haiti will pay five times that much in interest on its $1.5 billion foreign debt, much of which was incurred during the imperialist-supported Duvalier dictatorships. Haiti’s situation is not unique and it is not an extreme case. The total external debt of Third World countries in 2005 was $2.7 trillion, and their debt payments that year totalled $513 billion.[17] Ending that cash drain, immediately and unconditionally, would provide essential resources to feed the hungry now and rebuild domestic farming over time. Get the WTO out of agriculture. The regressive food policies that have been imposed on poor countries by the World Bank and IMF are codified and enforced by the World Trade Organization’s Agreement on Agriculture. The AoA, as Afsar Jafri of Focus on the Global South writes, is “biased in favour of capital-intensive, corporate agribusiness-driven and export-oriented agriculture.”[18] That’s not surprising, since the U.S. official who drafted and then negotiated it was a former vice-president of agribusiness giant Cargill. AoA should be abolished, and Third World countries should have the right to unilaterally cancel liberalization policies imposed through the World Bank, IMF, and WTO, as well as through bilateral free trade agreements such as NAFTA and CAFTA. Self-Determination for the Global South. The current attempts by the U.S. to destabilize and overthrow the anti-imperialist governments of the ALBA group — Venezuela, Bolivia, Cuba, Nicaragua and Grenada — continue a long history of actions by northern countries to prevent Third World countries from asserting control over their own destinies. Organizing against such interventions “in the belly of the monster” is thus a key component of the fight to win food sovereignty around the world. * * * More than a century ago, Karl Marx wrote that despite its support for technical improvements, “the capitalist system works against a rational agriculture … a rational agriculture is incompatible with the capitalist system.”[19] Today’s food and farm crises completely confirm that judgment. A system that puts profit ahead of human needs has driven millions of producers off the land, undermined the earth’s productivity while poisoning its air and water, and condemned nearly a billion people to chronic hunger and malnutrition. The food crisis and farm crisis are rooted in an irrational, anti-human system. To feed the world, urban and rural working people must join hands to sweep that system away. • -------------------------------------------------------------------------------- Footnotes 1. Frederic Mousseau, Food Aid or Food Sovereignty? Ending World Hunger in Our Time. Oakland Institute, 2005. International Assessment of Agricultural Knowledge, Science and Technology for Development, Global Summary for Decision Makers. 2. Francis Moore Lappe, Joseph Collins, Peter Rosset. World Hunger: Twelve Myths. (Grove Press, New York, 1998) p. 8 3. “About the Alliance for a Green Revolution in Africa.” 4. IRRI Press Release, April 4, 2008. 5. “World Bank President Calls for Plan to Fight Hunger in Pre-Spring Meetings Address.” News Release, April 2, 2008. 6. These figures are taken from the companies’ most recent quarterly reports, found on their websites. Because they report the numbers in different ways, they can’t be compared to each other, only to their own previous reports. 7. Shawn Hattingh. “Liberalizing Food Trade to Death.” MRzine, May 6, 2008. 8. Fred Magdoff, John Bellamy Foster and Frederick H. Buttel. Hungry for Profit: The Agribusiness Threat to Farmers, Food, and the Environment. Monthly Review Press, New York, 2000. p. 11 9. UN Food and Agriculture Organization. Key Statistics Of Food And Agriculture External Trade. 10. J. Madeley. Hungry for Trade: How the poor pay for free trade. Cited in Ibid. 11. Jahi Campbell, “Shattering Myths: Can sustainable agriculture feed the world?” and “Editorial. Lessons from the Green Revolution.” Food First Institute. www.foodfirst.org. 12. World Food Summit. 13. La Vía Campesina. “Food Sovereignty: A Future Without Hunger.” (1996) 14. Paraphrased from Ibid. 15. La Vía Campesina. “A response to the Global Food Prices Crisis: Sustainable family farming can feed the world.” 16. By way of comparison, this year Canada will spend $1 billion on the illegal occupation of and war in Afghanistan. 17. Jubilee Debt Campaign. “The Basics About Debt.” 18. Afsar H. Jafri. “WTO: Agriculture at the Mercy of Rich Nations.” Focus on the Global South, November 7, 2005. 19. Capital, Volume III. Karl Marx & Frederick Engels, Collected Works, Volume 37, p. 123 ]]> tag:www.globallabour.info,2008:/en//1.298 2008-07-10T14:00:43Z 2008-07-10T14:07:21Z

Private Equity Buyout Watch Deregulation and the systematic exploitation of US regulatory loopholes have facilitated a recent surge in speculative investment in commodity markets, much of it by institutional investors including pension funds. The influx is one of the driving forces behind the hyperinflation of basic food staples. Financializing Food: Deregulation, Commodity Markets and the Rising Cost of Food A May 31 article by Sinclair Stewart And Paul Waldie in the Toronto Globe and Mail (Feeding frenzy) describes how deregulation and the systematic exploitation of US regulatory loopholes have facilitated a recent surge in speculative investment in commodity markets, much of it by institutional investors including pension funds. The influx is one of the driving forces behind the hyperinflation of basic food staples. "These funds", write the authors, "Have plowed tens of billions of dollars into agricultural commodities as a way to diversify their assets and improve returns for their investors. The amount of fund money invested in commodity indexes has climbed from just $13-billion (U.S.) in 2003 to a staggering $260-billion in March 2008, according to calculations based on regulatory filings. Michael Masters, a veteran U.S. hedge fund manager, warned a Senate hearing this month that this number could easily quadruple to $1-trillion, if pension funds allocate a greater portion of their portfolio to commodities, as some consultants suggest they are poised to do. Because agricultural markets are small - relative to stock markets - the amount of cash pouring in gives these funds substantial clout. Mr. Masters estimated that that these big institutional investors control enough wheat futures to supply the needs of American consumers for the next two years, and blamed the "demand shock" from these recent entrants to the commodities markets as arguably the primary factor behind the sudden take-off in food prices. "If immediate action is not taken, food and energy prices will rise higher still," he told the hearing. "This could have catastrophic economic effects on millions of already stressed U.S. consumers. It literally could mean starvation for millions of the world's poor." The authors trace the progressive loosening of regulatory requirements which has made possible the enormous influx of money, much of it fleeing the meltdown in the market for mortgage-backed securities and the wider fallout, including big leveraged buyouts. "Beginning with the energy market, regulators made a series of far-reaching decisions that gradually loosened oversight of complex commodity derivatives and created loopholes for large speculators, allowing them to trade virtually unlimited amounts of corn, wheat and other food futures." The key breakthroughs for investors came in the energy futures market, establishing general precedents for all commodity trades (including food). In 1989, the US Commodity Futures Trading Commission (CFTC) issued a policy paper declaring that it would not regulate "swap deals" - commodity purchases involved financial intermediaries (typically banks) and the dealers. This was followed by a 1990 declaration by the CFTC that it would consider oil trading on the Brent Market as "forward contracts" (a contract in which the buyer ultimately takes delivery of the commodity) rather than "futures contracts" (in which the buyer rarely takes delivery, but uses the contract for purely speculative purposes). Futures contracts had traditionally been regulated, in order to curb speculation and volatility in key markets; forward contracts are not regulated. The ruling meant that oil futures trading was to be treated as outside the scope of CFTC regulation. "The CFTC's embrace of a narrow definition of a futures contract built on the regulator's earlier promise that it would not police swap transactions. Together, these moves opened up a new frontier of commodity trading, enabling financial speculators to buy and sell complex derivatives away from the prying eyes of regulators and exchanges." Expanding beyond the energy market into other commodities, institutional investors began diversifying into food. As the authors describe the chronology of deregulation, "It wasn't long before this infusion of money hit another regulatory snag. For almost 75 years, the CFTC has imposed limits on how much of certain agricultural commodities, including wheat, cotton, soybean, soybean meal, corn, and oats, can be traded by non-commercial players - that is, investors who are not part of the food industry. So-called "commercial hedgers," like farmers or food processors, can trade unlimited amounts in order to manage their risk." "The limits were designed to prevent manipulation and distortion in what are relatively small markets, and at the same time to allow for a small amount of speculative activity, in order to provide liquidity for trading. "For decades, the restrictions didn't pose much of a problem. And then, in 1991, as new money began pouring in, the playing field suddenly shifted. "Emboldened by the CFTC's laissez-faire approach, a bank approached the regulator and, for the first time, requested an exemption from speculative trading limits in an agricultural commodity. "The unnamed bank was acting as a "swap dealer" for a pension fund: Essentially, it was a middleman who helped the pension fund get exposure to commodities. A spokesman for the regulator declined to identify the bank or the pension plan, citing confidentiality requirements." The CFTC granted an exemption, ruling through a particularly tortuous logic that the swap dealer was for practical purposes no different than a food industry "commercial hedger", and therefore exempt from regulation - and regulatory limits on the size of the investment. The decision, however, was a one-time affair rather than a change in the rules. Investors need assurance that the exemption would become precedent, so in 1992 Congress passed legislation empowering the CFTC to determine what kinds of derivatives could be treated as forward contracts. Regulation was further loosed through new legislation in 2000 which established new exemptions, including virtual trading in energy futures contracts - the "Enron loophole". Freed of regulatory limits and requirements, pension funds increasingly turned to food commodity markets, The Ontario Teachers' Pension fund, which began with a modest investment in 1997, now has some USD 3 billion invested. With rising investor activity and increasing demand, prices became to rise: "Between 2000 and 2007, the price of wheat increased 147 per cent on the Chicago Board of Trade. Over the same period, corn increased 79 per cent and soybeans 72 per cent. In the past year, in particular, the price moves have been dramatic. The CFTC's moves to deregulate the sector, meanwhile, only inspired calls for more deregulation. As more funds piled in, stoking demand for agricultural futures contracts, speculators began clamouring for more flexibility with trading limits." Always eager to abandon its mandate of regulating in the public interest, the CFTC in 2005 expanded trading limits on the amount of wheat, corn, oats and soybeans that traders could buy or sell at any one time on the futures markets. In 2006, Deutsche Bank and an (undisclosed) fund asked to be exempted from all trading limits. The regulatory authorities assured them that there would be no penalties for exceeding the limits. More recently, the CFTC has proposed full regulatory exemption for index and pension funds, which would allow them to invest directly In the face of rising criticism, the same arguments produced in defense of the buyout binge are being adduced: the funds are "bringing liquidity" to the market, and generalizing risk. From another point of view, it has been estimated that every percent point increase in the price of food pushes an additional 16 million people into hunger. In its briefing paper for the World Food Summit held June 3-5 in Rome, the FAO devoted two perfunctory paragraphs to the influence of financial markets in pushing upwards the cost of staple food commodities in its "assessment of recent developments", and had nothing to say on the matter in its concluding "policy options". Regulating financial markets, it seems, is not a policy option in the face of mass starvation. ]]> tag:www.globallabour.info,2008:/en//1.299 2008-07-10T14:10:01Z 2008-07-10T14:12:56Z

Private Equity Buyout Watch Gobal fund manager Schroders is launching an Agricultural Land Fund, only months after closing its USD 6 billion Alternative Solutions Agriculture Fund due to excessive investor demand. Alternative Solutions, investing in grains, livestock, coffee, sugar, equities and financial instruments, had returned close to 50% since its launch in October 2006. In January this year, over 56% of the fund was allocated to commodity futures. "We closed the fund", a Schroders' spokesperson was quoted telling the UK press, "so that its performance objectives were not compromised by its size. Although capacity in the agriculture futures markets has increased from USD 40 billion to 200 billion in the last six to 12 months, it has not kept pace with investment demand for soft commodities." The new fund, to be listed on the London Stock Exchange in September, will target global agricultural land and land related industries through investment in private equity companies, farm management businesses and related funds. Approximately 25 per cent of the investment will be in agricultural land-related equities and commodities. Along with food commodity futures, agricultural land around the world has become a new magnet for speculative financial flows. In the US, despite the housing property crisis, soaring farmland values riding the ethanol boom have generated new investment vehicles and increased participation in existing vehicles by institutional investors. "The last six months I've definitely gotten a lot more calls from private equity managers and hedge funds", said the head of Hancock Agricultural Investment Group over a year ago. The fund's clients are exclusively pension funds and other institutional investors. The influx of financial investment into agricultural land is global. Last month, Netherlands-based agrifood giant Louis Drefyfus Commodities raised USD 65 million for Aclyx Agro Ltd., its new.vehicle established to buy, operate and sell land in Latin America (chiefly Brazil). The funding is principally from Dreyfus' own commodity fund and from AIG Brazil Special Situations Fund II, a Latin American private equity arm of the NYSE listed AIG Investments (American International Group) which was recently closed with US $691.9 million in investor capital. According to the May 12 announcement by the Latin American Venture Capital Association, "Calyx Agro plans to capitalize on the region's growing agribusiness sector and potential for farmland appreciation by acquiring land that is presently operating with low technology or used for livestock breeding. In turn, the company will seek to improve production yields, which is expected to ultimately drive a higher resale value of the land. "We believe that productive farmland will continue to be in high demand driven by the world's growing appetite for agricultural commodities and Latin America's competitive position in global trade," said Ana Vigon, Managing Director and Head of Latin America Private Equity at AIG Investments. "The investment in Calyx Agro will be AIG Investments' fourth in the Latin American agriculture sector, following investments in Falcon Farms, a premiere grower and distributor of fresh cut flowers with production based in Colombia, Ecuador, and Mexico, Frigorifico Mercosul, a leading Brazilian beef processor, and Fertilizantes Heringer, one of the largest fertilizer distributors in Brazil." The LAVA press release contains the following capsule summary of Dreyfus, one of the oldest privately-held global processors and grain traders: "Louis Dreyfus Commodities, one of the world's leading commodity merchants and processors of agricultural products, has merchandised and traded bulk commodities in international markets since 1851. Louis Dreyfus Commodities owns or operates considerable industrial assets around the world to conduct its global trading and merchandising activities. As a result, Louis Dreyfus Commodities is consistently ranked as one of the world's largest merchandisers of grains and oilseeds, is one of the three world's largest producers of orange juice (15% global market share), is the third largest producer of sugar in Brazil, the world's biggest exporting country, and is the largest trader and merchandiser of raw cotton in the world. The company is also a leader in the coffee, rice, metals and freight markets. Louis Dreyfus Commodities has an emerging worldwide presence in the expanding biofuels sector, including a leading position in the Brazilian ethanol market. Louis Dreyfus Commodities operates from five major regions (Argentina, Brazil, North America, Europe and Asia), and offices in Beijing, Buenos Aires, Delhi, Geneva, Sao Paulo, Singapore and Wilton (USA) serve as major coordination centers for merchandising activities. Louis Dreyfus Commodities is an affiliate of the Louis Dreyfus Group, an organization of diversified companies privately owned by the Louis-Dreyfus family. The global activities of Louis Dreyfus Commodities are vertically integrated under a holding company, Louis Dreyfus Commodities BV, which is based in the Netherlands." Private equity investment in South Asian food processing and agricultural land, previously focused on India (see "Buyouts Bomming in India's Food Processing Sector"), has now widened into Pakistan. According to a May 13 report in the Financial Times, "One of the Middle East's largest private equity companies has been quietly buying farmland in Pakistan as part of plans by the UAE to increase food security and to dampen inflation. Dubai-based Abraaj Capital says it is working with the UAE government on the strategic agribusiness investments in Pakistan. "The government in Abu Dhabi has been holding talks with Islamabad about a framework for investment in its agricultural sector as it seeks to secure cheaper long-term supplies of basic foodstuffs such as wheat and rice." ]]> tag:www.globallabour.info,2008:/en//1.300 2008-07-10T14:27:04Z 2008-07-10T14:35:41Z

“High-Level Panel on the Food Crisis, Production, Investment and Decent Work” - 97th ILO International Labour Conference, Geneva, June 11, 2008 Contribution of Ron Oswald, General Secretary, IUF The IUF welcomes this ILO policy discussion on the link between food security, production, investment and decent work, because it is precisely these dimensions of the present crisis which are missing from much of the analysis and policy proposals on offer today, including the conclusions of the recent FAO High Level Conference on World Food Security, which we therefore regard as a failure. One of the reasons for this failure is that the food crisis is seen mainly in terms of the rapid escalation in food prices over the past three years. Yet this is only one manifestation of a persistent, longer-term crisis in which the right to adequate food is denied to more than 800 million people, including those who work in agriculture. Recall that in 1996 the Rome Declaration on World Food Security stated, "We consider it intolerable that more than 800 million people throughout the world, and particularly in developing countries, do not have enough food to meet their basic nutritional needs." And this was when the global prices of major agricultural commodities were collapsing, hitting their lowest levels in three decades. Whether agricultural prices are hitting record highs or record lows, hundreds of millions of people continue to be denied the right to food. In 2002, the IUF published "The WTO and the World Food System". We began by asking, "If access to safe, nutritious food is a fundamental human right, why are 820 million people living in hunger today? Why are people in food-exporting countries living in hunger, and why are agricultural workers among the malnourished? If the value of annual global exports in agricultural products is USD 545 billion, why do waged agricultural workers and small farmers register among the highest levels of global poverty? More than half of the world's workforce is engaged in agricultural production. Why then are the conditions under which food is produced so destructive to the health and wellbeing of these people?" Since 2002, global agricultural trade has steadily increased to over USD 700 billion - and that figure is before the recent hyperinflation. Where are the benefits of expanding trade in agriculture promised us by the WTO, whose Doha Round the FAO urges be concluded as the main solution to global hunger? In 2007, the FAO estimated that 850 million people were chronically malnourished, though food production continued to outpace population growth. Now, in 2008, even the IMF is speaking of an additional 100 million potential new victims of starvation. A system which routinely condemns over 800 million people to hunger and malnutrition is self-evidently in permanent crisis. From the standpoint of international human rights law, which establishes the universal right of all human beings to adequate, affordable nutrition and the obligation of governments to ensure that that right is defended and fulfilled, the system is more than a failure. It is a crime. Among the foremost victims of this massive violation of the right to food are the nearly half a billion women and men who help produce the food we all depend on: waged agricultural workers. What is new today is the near-simultaneous appearance of mass protests in some 30 countries which has elevated this ongoing violation of human rights to a potential political crisis for governments. The new element driving these protests is hyperinflation in the price of staple foods. Prices of some of these essentials have doubled and tripled in the space of a year, some of them in the space of months. On March 31, the price of rice rose by 31% in a single day; on February 25, that of wheat by 27%. It has been estimated that every percentage point increase in the price of staple foodstuffs can send an additional 16 million people into hunger. The first question to ask, therefore, is why are so many millions already on the edge, and why are so many of them employed in agriculture? While it is an urgent necessity to halt the rise in prices, let us ask why there are no official proposals to raise rural workers' incomes to compensate for the loss of purchasing power and the reduction in calories. We should be asking why millions of rural workers sank into hunger and poverty when agricultural commodity prices fell steadily downwards, as they did through the 1990s. We should ask why the retail prices of, for example, coffee, tea, or sugar remained essentially stable, or even increased, for over a decade, while world market prices for these commodities were in prolonged free fall. Why, during these years, did the profits of the transnational processors and traders increase, along with their buying and marketing power; while the wages of coffee, tea, and sugar workers stagnated or fell, sometimes drastically? Where is the linkage between commodity prices, retail prices, wages and purchasing power the WTO assured us liberalized trade would achieve through the "optimal utilization of resources"? Dependence on volatile global commodity prices has pushed entire populations to the brink of starvation. The FAO conference last week concluded with a call to quickly complete the Doha round. How can we rush to a faster conclusion of the Doha Round when it was the WTO regime– and the Agreement on Agriculture in particular - that facilitated import surges that have devastated vital systems of local and national food production. Between 1995 and 2000, the price of maize in Mexico fell by 70% while the price of tortillas, the staple maize bread, increased by 300%, and quadrupled in the space of a few months last year. In these 5 years, an estimated 1.3 million workers and small farmers were forced to abandon the countryside in search of work. Many of these were forced to leave Mexico. Commodity prices in themselves tell us nothing about the capacity of the world's agricultural workers to feed themselves, or the urban poor. The key issues are vulnerability, volatility, and the extraction of value along the food chain. While an additional 100 million people face possible starvation as a result of rapidly rising cereal and oilseed prices, corporate profits for the traders and primary processors are at record levels. Cargill, the world's leading trader, registered an 86% increase in profits from commodity trading in the first quarter of this year. 2007 profits for ADM, the second global trader, were up 67% per cent last year. Bunge, riding the wave of demand for oilseed for biodiesel, enjoyed a 77% increase in first quarter profits this year. Nestlé, the world's largest food corporation, posted exceptional 2007 profits and launched a 25 billion dollar share buyback program - while telling its workers that higher input prices mean they should brace themselves for layoffs and wage cuts. You can search in vain for the word corporation in the FAO's 50 page briefing paper for the World Food Crisis Summit - this in a report entitled "Facts, Perspectives, Impacts and Actions Required". You won't find it either in the OECD-FAO Agricultural Outlook 2008-2017 - though you will find a message to the global poor that food will be unaffordable for the next decade or more. The main issues and actors in the crisis of the world food system are simply not there. The driving force behind liberalizing agricultural trade over the past decade - the enormous increase in the reach, power and market share of transnational corporations, not only across borders but within local and national markets through intra-company trade and subsidiaries - is entirely absent. There are only markets, market signals, and prices. With these "facts" and this "perspective", how can we understand the real mechanisms at work, and meaningfully address the issues? The forces generating hunger don't simply happen – they are made to happen. If world cereal stocks are low, it is because governments were systematically pressured, lobbied, blackmailed and seduced into selling them off, thereby privatizing an essential mechanism for managing supply. The corporations now manage the planet's food stocks. Publicly funded agricultural research did not simply "decline" – it was consciously dismantled under the watchful eye of the World Bank, ensuring that research would become the exclusive preserve of corporate R&D. With the major actors rendered invisible - and in particular, the corporations and the financial speculators who increasingly dictate how and what kind of food is planted, harvested, processed and marketed at what price, we’re left with an "action plan" which tells the poor it will essentially be business as usual. What should have been an opportunity in Rome for governments to show their commitment to following through on their obligation to protect and enforce the right to food therefore concluded with humanitarian assistance and vague calls for more investment, more seed, more fertilizer etc. - without specifying what kinds of investment, what investors, what seeds, and investment for whom. While international agencies have suddenly discovered underinvestment, investment in commodity indexes has climbed from US$13-billion in 2003 to $260-billion in March 2008 - and according to some analysts may soon hit a trillion US dollars. Yet the FAO briefing paper for the Rome summit devoted a dismissive two paragraphs to the phenomenon in its "assessment of recent developments", and nothing in its concluding "policy options". Private equity and hedge funds - investors focused on short-term, high-yield gains - have been expanding beyond futures markets and are now pouring billions into acquiring farmland, inputs and infrastructure. The real world has been left behind - and with it production, investment and decent work. The real issue is what kind of investment, what kind of production, and who benefits. World Bank research has convincingly established that the massive diversion of cereal and oilseed crops for biofuel production is responsible for much of the pressure behind food price inflation - from one-third to as much as 75%, according to one study, when land use and the impact on food stocks are factored in. The escalating price of oil is also a critical factor, for the world food system is addicted to carbon fuels for pesticide and fertilizer inputs and for long-distance transport. Food has become a branch of the petrochemical industry. The FAO sees speculation playing no significant role in pushing prices upwards, but meanwhile investment funds are betting hundreds of billions of dollars on higher prices, creating a bubble that drives prices upwards. It was speculation alone which drove up the price of rice futures by 31% in a few hours on March 31. Retail prices follow, and the consequences can be fatal. As Tom Giessel, a US wheat farmer said recently "We're commoditizing everything and losing sight that it's food, that it's something people need. We're trading lives". Combating hunger requires moving away from the industrialized monocultures which are strip-mining the soil and depleting and contaminating water resources. Governments must have restored to them the policy tools they need to ensure food security through investment in local and national food systems. Clearly, we must halt the diversion of food from human consumption to fuel tanks. Food and agriculture must be defended from the incursions of financial markets through regulation. And we must ensure the basic rights of all those who work in agriculture. These are in fact among the conclusions of the UN's own International Assessment of Agricultural Knowledge, Science and Technology for Development - the IAASTD, whose recent report has been endorsed by over 60 nations but whose findings and conclusions played no role in the FAO summit. As we mark the 60th anniversary of ILO Convention 87 on freedom of association, the rights of agricultural workers are still systematically violated, and this systematic violation of rights is reflected in a food system which is neither socially nor environmentally sustainable. Agricultural work remains a domain of poverty, violence, child labour, death and injury on the job. Agricultural workers are still specifically excluded from national systems of industrial relations in some of the richest countries of the world, countries which are major producers and exporters of food. How is it possible in 2008, that we are still fighting for recognition of agricultural workers' right to potable water as a universal human right? The missing link between investment, production and decent work –the title of this panel - is social regulation. No matter how many billions or even trillions flow into agriculture, this investment fails to deliver decent work and fails to advance the right to food. What we see instead is more volatility and therefore more vulnerability. Social regulation at national and sub-national level, including the implementation of ILO standards, is necessary to ensure that these capital flows are channeled into decent work, poverty alleviation and sustainable food security. Governments must have and be able to exercise the right to be able to protect food and food workers. This is why the ILO must play a central role in the UN's interagency work on food security. We therefore think it essential that, in the followup to the work of this year's ILC Committee on Rural Employment for Poverty Reduction, the ILO call for the rapid organization of a public policy forum on the global food crisis from the standpoint of production, investment and decent work, a policy forum in which the women and men who help produce the world's food, and their trade unions, can bring the real issues and real solutions to the table. * * * * * The International Union of Food, Agricultural, Hotel, Restaurant, Catering, Tobacco and Allied Workers’ Associations (IUF) is an international trade union federation composed of 373 trade unions in 121 countries with an affiliated membership of over 2.8 million members. It is based in Geneva, Switzerland. International Union of Food, Agricultural, Hotel, Restaurant, Catering, Tobacco and Allied Workers’ Associations (IUF) Rampe du Pont-Rouge, 8, CH-1213 Petit-Lancy (Switzerland) TEL: + 41 22 793 22 33 FAX: + 41 22 793 22 38 www.iuf.org iuf@iuf.org]]> tag:www.globallabour.info,2008:/en//1.304 2008-07-13T16:03:17Z 2008-07-13T16:25:42Z

SALB) is a bi-monthly journal which started publishing in the 1970s as a voice of the emerging independent, non racial and militant labour movement. It is the only alternative anti-apartheid publication which survived into South Africa’s new democracy. Its mission is to provide information and to stimulate critical analysis and debate on issues and challenges that confront workers, their organizations and their communities. In doing so, the SALB hopes to advance the discourse of progressive politics, promote social justice and the interests of the working class. ]]> tag:www.globallabour.info,2008:/en//1.306 2008-07-13T16:53:57Z 2008-07-13T16:56:20Z

IISH) was founded in 1935. It is one of the world's largest documentary and research institutions in the field of social history in general and the history of the labour movement in particular. Most of the collections are open to the public. ]]> tag:www.globallabour.info,2008:/en//1.309 2008-07-13T17:12:28Z 2008-07-13T17:13:09Z

IALHI), founded in 1970, brings together archives, libraries, document centres, museums and research institutions specializing in the history and theory of the labour movement from all over the world. ]]> tag:www.globallabour.info,2008:/en//1.314 2008-07-16T14:58:59Z 2008-07-16T15:04:43Z

Gobal Union Federations Building and Wood Workers' International (BWI) Route des Acacias 54 P.O. Box 1412 CH-1227 Carouge-Genève tel.: (+41 22) 827 37 77 fax: (+41 22) 827 37 70 e-mail: info@bwint.org website: www.bwint.org General Secretary: Anita Normark Education International (EI) 155, boulevard Emile-Jacqmain B-1210 Bruxelles tel.:(+32 2) 224 06 11 fax:(+32 2) 224 06 06 e-mail: headoffice@ei-ie.org website: http://www.ei-ie.org General Secretary: Fred van Leeuwen International Federation of Chemical, Energy and General Workers’ Unions (ICEM) Route des Acacias 54 bis CH-1227 Carouge-Genève tel.:(+41 22) 304 18 40 fax:(+41 22) 304 18 41 e-mail: info@icem.org website: http://www.icem.org General Secretary: Manfred Warda International Federation of Journalists (IFJ) 266, Rue Royale B-1210 Bruxelles tel.:(+32 2) 223 22 65 fax:(+32 2) 219 29 76 e-mail: ifj@ifj.org website: http://www.ifj.org General Secretary: Aidan White International Metalworkers’ Federation (IMF) Route des Acacias 54 bis P.O. Box 563 CH-1227 Carouge-Genève tel.:(+41 22) 308 50 50 fax:(+41 22) 308 50 55 e-mail: imf@iprolink.ch website: http://www.imfmetal.org General Secretary: Marcello Malentacchi International Textile, Garment and Leather Workers’ Federation (ITGLWF) 8, rue Joseph Stevens B-1000 Bruxelles tel.:(+32 2) 512 26 06 fax:(+32 2) 511.09.04 e-mail: office@itglwf.org website: http://www.itglwf.org General Secretary: Neil Kearney International Transport Workers’ Federation (ITF) ITF House 49-60 Borough Road GB-London SE1 1DS tel.:(+44 171) 403 27 33 fax:(+44 171) 357 78 71 e-mail: mail@itf.org.uk website: http://www.itfglobal.org General Secretary: David Cockroft International Union of Food, Agricultural, Hotel, Restaurant, Catering, Tobacco and Allied Workers’ Associations (IUF) Rampe du Pont-Rouge 8 CH-1213 Petit-Lancy/Genève te.:(+41 22) 793 22 33 fax:(+41 22) 793 22 38 e-mail: iuf@iuf.org website: http://www.iuf.org General Secretary: Ron Oswald Public Service International (PSI) 45, avenue Voltaire F-01211 Ferney-Voltaire Cedex tel.:(+33 50) 40 64 64 fax:(+33 50) 40 73 20 e-mail: psi@world-psi.org website: http://www.world-psi.org General Secretary: Peter Waldorff Union Network International Avenue Reverdil 8-10 CH-1260 Nyon tel.: (+41 22) 365 21 00 fax: (+41 22) 365 21 21 e-mail: contact@union-network.org website: http://www.union-network.org General Secretary: Philip Jennings ]]> tag:www.globallabour.info,2008:/en//1.315 2008-07-16T15:23:26Z 2008-07-16T15:28:03Z

"We shall require a substantially new manner of thinking if mankind is to survive." From Monthly Review, New York, May, 1949. [Re-printed in Ideas and Opinions by Albert Einstein] Transcribed by Lenny Gray Is it advisable for one who is not an expert on economic and social issues to express views on the subject of socialism? I believe for a number of reasons that it is. Let us first consider the question from the point of view of scientific knowledge. It might appear that there are no essential methodological differences between astronomy and economics: scientists in both fields attempt to discover laws of general acceptability for a circumscribed group of phenomena in order to make the interconnection of these phenomena as clearly understandable as possible. But in reality such methodological differences do exist. The discovery of general laws in the field of economics is made difficult by the circumstance that observed economic phenomena are often affected by many factors which are very hard to evaluate separately. In addition, the experience which has accumulated since the beginning of the so-called civilized period of human history has -- as is well known -- been largely influenced and limited by causes which are by no means exclusively economic in nature. For example, most of the major states of history owed their existence to conquest. The conquering peoples established themselves, legally and economically, as the privileged class of the conquered country. They seized for themselves a monopoly of the land ownership and appointed a priesthood from among their own ranks. The priests, in control of education, made the class division of society into a permanent institution and created a system of values by which the people were thenceforth, to a large extent unconsciously, guided in their social behavior. But historic tradition is, so to speak, of yesterday; nowhere have we really overcome what Thorstein Veblen called "the predatory phase" of human development. The observable economic facts belong to that phase and even such laws as we can derive from them are not applicable to other phases. Since the real purpose of socialism is precisely to overcome and advance beyond the predatory phase of human development, economic science in its present state can throw little light on the socialist society of the future. Second, socialism is directed toward a social-ethical end. Science, however, cannot create ends and, even less, instill them in human beings; science, at most, can supply the means by which to attain certain ends. But the ends themselves are conceived by personalities with lofty ethical ideals and -- if these ends are not stillborn, but vital and vigorous -- are adopted and carried forward by those many human beings who, half-unconsciously, determine the slow evolution of society. For these reasons, we should be on our guard not to overestimate science and scientific methods when it is a question of human problems; and we should not assume that experts are the only ones who have a right to express themselves on questions affecting the organization of society. Innumerable voices have been asserting for some time now that human society is passing through a crisis, that its stability has been gravely shattered. It is characteristic of such a situation that individuals feel indifferent or even hostile toward the group, small or large, to which they belong. In order to illustrate my meaning, let me record here a personal experience. I recently discussed with an intelligent and well-disposed man the threat of another war, which in my opinion would seriously endanger the existence of mankind, and I remarked that only a supranational organization would offer protection from that danger. Thereupon my visitor, very calmly and coolly, said to me: "Why are you so deeply opposed to the disappearance of the human race?" I am sure that as little as a century ago no one would have so lightly made a statement of this kind. It is the statement of a man who has striven in vain to attain an equilibrium within himself and has more or less lost hope of succeeding. It is the expression of a painful solitude and isolation from which so many people are suffering in these days. What is the cause? Is there a way out? It is easy to raise such questions, but difficult to answer them with any degree of assurance. I must try, however, as best I can, although I am very conscious of the fact that our feelings and strivings are often contradictory and obscure and that they cannot be expressed in easy and simple formulas. Man is, at one and the same time, a solitary being and a social being. As a solitary being, he attempts to protect his own existence and that of those who are closest to him, to satisfy his personal desires, and to develop his innate abilities. As a social being, he seeks to gain the recognition and affection of his fellow human beings, to share in their pleasures, to comfort them in their sorrows, and to improve their conditions of life. Only the existence of these varied, frequently conflicting strivings accounts for the special character of a man, and their specific combination determines the extent to which an individual can achieve an inner equilibrium and can contribute to the well-being of society. It is quite possible that the relative strength of these two drives is, in the main, fixed by inheritance. But the personality that finally emerges is largely formed by the environment in which a man happens to find himself during his development, by the structure of the society in which he grows up, by the tradition of that society, and by its appraisal of particular types of behavior. The abstract concept "society" means to the individual human being the sum total of his direct and indirect relations to his contemporaries and to all the people of earlier generations. The individual is able to think, feel, strive, and work by himself; but he depends so much upon society -- in his physical, intellectual, and emotional existence -- that it is impossible to think of him, or to understand him, outside the framework of society. It is "society" which provides man with food, clothing, a home, the tools of work, language, the forms of thought, and most of the content of thought; his life is made possible through the labor and the accomplishments of the many millions past and present who are all hidden behind the small word "society." It is evident, therefore, that the dependence of the individual upon society is a fact of nature which cannot be abolished -- just as in the case of ants and bees. However, while the whole life process of ants and bees is fixed down to the smallest detail by rigid, hereditary instincts, the social pattern and interrelationships of human beings are very variable and susceptible to change. Memory, the capacity to make new combinations, the gift of oral communication have made possible developments among human beings which are not dictated by biological necessities. Such developments manifest themselves in traditions, institutions, and organizations; in literature; in scientific and engineering accomplishments; in works of art. This explains how it happens that, in a certain sense, man can influence his life through his own conduct, and that in this process conscious thinking and wanting can play a part. Man acquires at birth, through heredity, a biological constitution which we must consider fixed and unalterable, including the natural urges which are characteristic of the human species. In addition, during his lifetime, he acquires a cultural constitution which he adopts from society through communication and through many other types of influences. It is this cultural constitution which, with the passage of time, is subject to change and which determines to a very large extent the relationship between the individual and society Modern anthropology has taught us, through comparative investigation of so-called primitive cultures, that the social behavior of human beings may differ greatly, depending upon prevailing cultural patterns and the types of organization which predominate in society. It is on this that those who are striving to improve the lot of man may ground their hopes: human beings are not condemned, because of their biological constitution, to annihilate each other or to be at the mercy of a cruel, self-inflicted fate. If we ask ourselves how the structure of society and the cultural attitude of man should be changed in order to make human life as satisfying as possible, we should constantly be conscious of the fact that there are certain conditions which we are unable to modify. As mentioned before, the biological nature of man is, for all practical purposes, not subject to change. Furthermore, technological and demographic developments of the last few centuries have created conditions which are here to stay. In relatively densely settled populations with the goods which are indispensable to their continued existence, an extreme division of labor and a highly centralized productive apparatus are absolutely necessary. The time -- which, looking back, seems so idyllic -- is gone forever when individuals or relatively small groups could be completely self-sufficient. It is only a slight exaggeration to say that mankind constitutes even now a planetary community of production and consumption. I have now reached the point where I may indicate briefly what to me constitutes the essence of the crisis of our time. It concerns the relationship of the individual to society. The individual has become more conscious than ever of his dependence upon society. But he does not experience this dependence as a positive asset, as an organic tie, as a protective force, but rather as a threat to his natural rights, or even to his economic existence. Moreover, his position in society is such that the egotistical drives of his make-up are constantly being accentuated, while his social drives, which are by nature weaker, progressively deteriorate. All human beings, whatever their position in society, are suffering from this process of deterioration. Unknowingly prisoners of their own egotism, they feel insecure, lonely, and deprived of the naive, simple, and unsophisticated enjoyment of life. Man can find meaning in life, short and perilous as it is, only through devoting himself to society. The economic anarchy of capitalist society as it exists today is, in my opinion, the real source of the evil. We see before us a huge community of producers the members of which are unceasingly striving to deprive each other of the fruits of their collective labor -- not by force, but on the whole in faithful compliance with legally established rules. In this respect, it is important to realize that the means of production -- that is to say, the entire productive capacity that is needed for producing consumer goods as well as additional capital goods -- may legally be, and for the most part are, the private property of individuals. For the sake of simplicity, in the discussion that follows I shall call "workers" all those who do not share in the ownership of the means of production -- although this does not quite correspond to the customary use of the term. The owner of the means of production is in a position to purchase the labor power of the worker. By using the means of production, the worker produces new goods which become the property of the capitalist. The essential point about this process is the relation between what the worker produces and what he is paid, both measured in terms of real value. In so far as the labor contract is "free," what the worker receives is determined not by the real value of the goods he produces, but by his minimum needs and by the capitalists' requirements for labor power in relation to the number of workers competing for jobs. It is important to understand that even in theory the payment of the worker is not determined by the value of his product. Private capital tends to become concentrated in few hands, partly because of competition among the capitalists, and partly because technological development and the increasing division of labor encourage the formation of larger units of production at the expense of the smaller ones. The result of these developments is an oligarchy of private capital the enormous power of which cannot be effectively checked even by a democratically organized political society. This is true since the members of legislative bodies are selected by political parties, largely financed or otherwise influenced by private capitalists who, for all practical purposes, separate the electorate from the legislature. The consequence is that the representatives of the people do not in fact sufficiently protect the interests of the underprivileged sections of the population. Moreover, under existing conditions, private capitalists inevitably control, directly or indirectly, the main sources of information (press, radio, education). It is thus extremely difficult, and indeed in most cases quite impossible, for the individual citizen to come to objective conclusions and to make intelligent use of his political rights. The situation prevailing in an economy based on the private ownership of capital is thus characterized main principles: first, means of production (capital) are privately owned and the owners dispose of them as they see fit; second, the labor contract is free. Of course, there is no such thing as a pure capitalist society in this sense. In particular, it should be noted that the workers, through long and bitter political struggles, have succeeded in securing a somewhat improved form of the "free labor contract" for certain categories of workers. But taken as a whole, the present-day economy does not differ much from "pure" capitalism. Production is carried on for profit, not for use. There is no provision that all those able and willing to work will always be in a position to find employment; an "army of unemployed" almost always exists. The worker is constantly in fear of losing his job. Since unemployed and poorly paid workers do not provide a profitable market, the production of consumers' goods is restricted, and great hardship is the consequence. Technological progress frequently results in more unemployment rather than in an easing of the burden of work for all. The profit motive, in conjunction with competition among capitalists, is responsible for an instability in the accumulation and utilization of capital which leads to increasingly severe depressions. Unlimited competition leads to a huge waste of labor, and to that crippling of the social consciousness of individuals which I mentioned before. This crippling of individuals I consider the worst evil of capitalism. Our whole educational system suffers from this evil. An exaggerated competitive attitude is inculcated into the student, who is trained to worship acquisitive success as a preparation for his future career. I am convinced there is only one way to eliminate these grave evils, namely through the establishment of a socialist economy, accompanied by an educational system which would be oriented toward social goals. In such an economy, the means of production are owned by society itself and are utilized in a planned fashion. A planned economy, which adjusts production to the needs of the community, would distribute the work to be done among all those able to work and would guarantee a livelihood to every man, woman, and child. The education of the individual, in addition to promoting his own innate abilities, would attempt to develop in him a sense of responsibility for his fellow-men in place of the glorification of power and success in our present society. Nevertheless, it is necessary to remember that a planned economy is not yet socialism. A planned economy as such may be accompanied by the complete enslavement of the individual. The achievement of socialism requires the solution of some extremely difficult socio-political problems: how is it possible, in view of the far-reaching centralization of political and economic power, to prevent bureaucracy from becoming all-powerful and overweening? How can the rights of the individual be protected and therewith a democratic counterweight to the power of bureaucracy be assured? ]]> tag:www.globallabour.info,2008:/en//1.323 2008-07-23T11:28:58Z 2008-07-31T13:38:59Z

Viking-Laval-Rüffert: Economic freedoms versus fundamental social rights – where does the balance lie? Debate organised by Notre Europe and the European Trade Union Institute Alain Supiot is Director of the Institute of Advanced Studies, Nantes, France. The original version of this article, in French, was published by the «Revue Permanente du Mauss», www.journaldumauss.net/spip.php?article28 . How to balance the application of the European Union’s free movement rules - in particular, the right to work and provide services in another member state - with the maintenance of different national social systems? In particular, how will these freedoms affect trade union rights such as the right to collective action and collective bargaining? These questions are the object of much debate, following three recent rulings adopted by the European Court of Justice. The ETUI and Notre Europe have therefore decided to launch this forum, in which users will find information on the different cases and analysis offered by a variety of experts. Europe won over to the “communist market economy”(1) The European court of Justice holds an essential part of the legislative power in the European Union. In the image of the Ancien Régime sovereign courts or the Common Law HighCourts, it statutes for the future, by ruling erga omnes, like the law itself. All those who had hoped that Europe could embody on a world scale a “social model” placing economic freedom in the service of the people awaited eagerly the two judgments it returned on the 11th and 18th of December in the Viking and Laval cases. These cases happened to raise the question of whether the trade unions have the right to act against companies using the economic freedom guaranteed by the Treaty of Rome to lower salaries and working conditions. In the Viking case, a Finnish passenger transport company wished to register one of its ferries under flag of convenience in Estonia with a view to elude Finnish labour agreements. The Laval case concerned a Latvian construction society employing a Latvian workforce in Sweden and refusing to honour Swedish labour agreements. In both instances, the trade unions had successfully resorted to a range of collective actions (sympathetic strike, blockade, boycott) to force the companies to respect those agreements. The European Court was asked to consider the specific point of whether these actions, lawful under national law, could be unlawful under Community Law in so far as they impeded the freedom of companies to place themselves under the social rules least advantageous to the workforce. In essence, the Court sided with the companies (2) . With the right to strike explicitly excluded from the scope of Community competences in the social sphere (3), it should come as a surprise to find it willing to interfere with such regulation. But the Court has considered since long that nothing in internal law should escape the primacy of economic freedom the Treaty guarantees. So that no exception under issues of national competence is likely to curb the power it has awarded itself to lay down the law inside Member States (4). There is more cause to wonder at the fact that the Court, after the Bolkestein draft directive shambled, should have had no qualms in adding fuel to the fire by forbidding workers to strike against companies opting to operate in a country without observing its Social Law. For it is precisely what it forbids in the Laval judgment. On the grounds that Community Law imposes on companies transferring employees in an other state a number of minimal social regulations, the Court has decided that a collective action aimed at obtaining not only the respect of this minimum but also equal treatment with that State’s workforce represents an unjustified hindrance to the freedom to provide services. The Viking judgment asserts for its part that the right to resort to flags of convenience proceeds from the freedom of establishment guaranteed by Community Law and that the campaign led by trade unions at international level is therefore liable to infringe this fundamental freedom. The court recognizes, of course, that the right to strike “is an integral part of the general principles of Community law”. But it forbids its use in order to force the companies in country A, operating in country B to respect in full its laws and labour agreements. Barring “overriding reasons of public interest” (5) , trade unions must do nothing “liable to make less attractive, nay more difficult” the resort to relocation or flags of convenience. This jurisprudence casts into sharp light the course taken by Community Law. It was already clear that the evolution of this law almost completely eluded the citizens, given both a want of any real polling at European level and the states’ capacity to crush ballot resistance as expressed in national referendums. the rulers of EU countries have managed to get around the rejection in turn of the Maastricht Treaty by the Danish voters, of the Nice Treaty by the Irish and more recently of the Constitutional Treaty by the French and Dutch voters. Hugo Chavez would most certainly not get away with the expedient of getting Parliament to pass a constitutional reform freshly denied him by referendum. It is becoming the form, in European matters, to consider the result of a vote as binding only if it meets with the wishes of the leaders who called it (6) . The other contribution of the Laval and Viking judgments is to shield Community Law from strikes and other collective action liable to fetter its implementation. To this end, trade rulesare deemed applicable to the trade unions (7), the “Freedom of Association and Protection of the Right to Organise” as guarantied by convention 87 of the ILO not withstanding. And yet, the respect of this freedom is an essential element of democracy. In the past, the social policies of corporatist or communist regimes may have been more generous or ambitious than those of western democracies. But the hallmark of those despotic regimes had been the top down imposition of a common good that would brook no contradiction and the imposition on the trade unions of the respect of an economic orthodoxy presupposing the correctness of the established order. A defining aspect of democracies has been on the contrary to accept that social justice could not just be imposed from on high but also arose from below, from the confrontation between employers and employees’ interests. Hence the authentic – as opposed to merely formal – recognition and protection of the freedom of association and right to strike whereby the weak may bring the strong up against their own representation of justice. Nevertheless, the legal consecration of the right to strike in western democracies was only won after World War II. Needless to say, it remains fragile in Western Europe and has no precedent in the East. In the context of enlarged Europe, it is not that surprising that the Community judge decided, contrary to earlier decisions in the field of collective agreements (8), to subordinate the employees’ collective freedoms to the companies’ economic freedoms. It is to be feared however that these judgments may contribute to push Europe further down the slippery slope. Juridical devices specific to democracy, whether electoral freedom or freedom of association make it possible to process the stuff of political or social unrest and to convert tests of strength into test cases. The gradual stalling of all these devices at European level can only foster in due course identity withdrawal, corporatist discontent and violence. As Perry Anderson (9) recently observed, Europe is on the verge of implementing the constitutional projects of one of current economic fundamentalism’s fathers, Friedrich Hayek. Hayek has written at length in his books about his project for a “limited democracy”, in which the division of labour, wealth, indeed currency would be totally shielded from political action and electoral hazards: “The root of the trouble is that in an unlimited democracy the holders of discretionary powers are forced to use them, whether they wish it or not, to favour particular groups on whose swing-vote their powers depend. (…) Once we give licence to the politicians to interfere in the spontaneous order of the market (…) they initiate that cumulative process which by inner necessity leads (…) then to an ever-growing domination over the economic process by politics. “ (10) According to Hayek, the danger does not lie with individual but with group rapacity (11). Favourable to the setting up of a minimal survival income, he just loathed trade unionism and more broadly mall solidarity-based institutions for he saw there the resurgence of “the atavistic conception of distributive justice”, which can only lead to the ruin of the “spontaneous market order” founded in true pricing and the pursuit ,of individual gain. According to him, people, in western societies, have become incapable of understanding the law of the market (12). Accordingly he recommended to “dethrone politics” by means of constitutional provisions which would ensure that “nobody can conclusively determine how well-off particular groups or individuals will be” (13). As he did not believe in the “rational actor” in economics, he relied on the natural selection of rules and practices from competing laws and cultures on an international scale. According to him the champions of social Darwinism made the mistake of focussing on the selection of congenitally fitter individuals, a process too slow to have a measurable impact, while “at the same time neglecting the decisively important selective evolution of rules and practices” (14). This taste for normative Darwinism and this disregard for social solidarity is conspicuous in the Laval and Viking judgments which pave the way towards open competition between Member States’ social laws, subject only to the respect of the minimal provisions of the 1996 Directive. The political influence of Hayek’s theories has been and continues to be considerable. It laid the dogmatic foundation of the neo-conservative revolution spearheaded in Europe by the United Kingdom, where it continues to flourish (15). However, the current success of the “limited democracy” and “legal products markets” (16) concepts arises essentially from Eastern Europe’s and China’s conversion to market economy. With customary arrogance, the West has seen in these events, and in the ensuing enlargement of the European community, the final victory of their societal model when they have in fact heralded what the Chinese leaders call the “communist market economy” (17). It would be a mistake to make light of this rather improbable notion as it sheds light on the turn taken by globalisation. Our understanding of communism, market economy or democracy, has not equipped us to understand the singularity of the paths trodden today by Russia or China, or to see how these countries are at the forefront of the broader tendencies of new world Capitalism. Neither is it equal to explaining Europe’s “democratic deficit”, or the way politics in western countries has been eclipsed by “governance”, founded on quantified indicators and other “benchmarking” techniques. As against that, these techniques can convincingly be associated with the planning instrument used by the defunct Gosplan (18): although deployed in a wholly different environment, they are loaded with the same risks of disconnection from the facts, for they proceed from the same obsession with standards, from the same denial of the necessary gap between is and ought. In this respect at any rate, Hayek must be exonerated for beeing the first to warn against the excesses of economic goal setting (19). The concept of communist market economy may help to understand these evolutions, just as long as nobody tries to reduce it to either communism or the market. Arrived at with what capitalism and communism had in common (economism and abstract universalism), this hybrid system borrows from the market wholesale competition, free trade and individual utility maximisation, and from communism its “limited democracy”, the instrumentalisation of the law, an obsession with quantification and the complete disconnection between the rulers and the ruled. It offers every country’s ruling class the possibility to acquire colossal wealth (a thing communism did not allow) while being fully disengaged in respect of the fate of the middle and lower classes (a thing welfare states’ political or social democracy did not allow). A new Nomenklatura – whose sudden wealth is owed in no small part to the privatisation of public goods – has thus used market liberalisation to avoid financing the national systems of assistance. This secession of the elites (in Christopher Lasch’s felicitous words (20) is driven by a new type of leaders (senior officials, former communist bosses or Maoist militants turned businessmen) who no longer have much in common with traditional capitalist entrepreneurs. Both east and West, a fair number of such leaders, moulded by Marxism-Leninism or Maoism, enthusiastically embraced economic deregulation theories and public goods privatisations, by which they profited handsomely. In France in particular, the figure of the oligarch prospered in the wake of public companies’ privatisation. Their guiding principle was stated with great candour and clarity by a former Medef (21) Vice-President, Mr Denis Kessler: it consists in methodically stripping the post-war consensus (22). The Conseil National de la Résistance, the CNR’s programme (23) had such headings as “setting up the broadest possible democracy (…) freedom of the press and its independence from moneyed powers (…) the advent of a genuine economic and social democracy, requiring the removal from economic management of the great economic and financial barons (…) the restoration of a free trade unionism in its traditional rights and endowment with broad powers in the organisation of the economic and social life” (24). Indeed, none of this is compatible with communist market economy. But how far does the latter require the “stripping” of the rights and principles listed in the CNR’s programme? The question requires urgent attention when it comes to human dignity, which the programme took as the foundation of workers’ rights to correct wages (25). For the principle of dignity is not a fundamental right among others, but the founding principle of a civilised legal order and from it flow as many duties as rights for all human beings. It started its juridical life in two major international declarations contemporary to the CNR programme: the 1944 Philadelphia Declaration (annexed to the ILO constitution) and the 1948 Universal Declaration of Human Rights. At the same time, and for obvious reasons, the new Federal Republic of Germany dedicated the first article of its constitution to it and all German jurists know it by heart (26). Dignity does not refer to one right among many but to a metajuridical principle. In spite of its long legal and philosophical history and in spite of the disputes it causes today, this principle means something very simple that everyone can understand: human beings, are not animals like the others and must never be treated like beasts. If dignity was thus brought to the fore at the end of the “thirty years war” which devastated Europe and the world from 1914 to 1945, it is because the horrors of this war had shown what came from reducing human beings to “human material”. Whereas “Man” in the declaration of rights inherited from the Enlightenment was a pure spirit, the notion of dignity also gave him a body. That is why it was first used to found the economic and social rights (Labour Law and Social Security Law) which aim to secure decent living conditions for all: to those who live from their work but also to the sick, the disabled, the old or the unemployed. The best thing that can happen to the principle of dignity within the legal system is to remain hidden by an architecture of rights and duties which it underpins and which bestows its positive legal outcomes. If Social Law, for instance, sets the minimum salary at a decent level, there is no more need to refer to dignity in this domain. It is much talked about these days and in too many contexts for it to be a good sign. Besides, it is talked about very badly, as of a right among many, which needs to fit in with all the others. Summarising in new terms one of its earlier judgments (27), the European Court of Justice thus states in the Viking (§ 46) and Laval (§ 94) judgments that “the exercise of the fundamental rights at issue, that is, freedom of expression and freedom of assembly and respect for human dignity, respectively, does not fall outside the scope of the provisions of the Treaty and considered that such exercise must be reconciled with the requirements relating to rights protected under the Treaty and in accordance with the principle of proportionality.” Saying that human dignity must be “reconciled” with the companies’ economic freedoms (or with the right to strike or any other collective right) is as good as saying that it can be infringed if anything can be gained by that. Can the economic freedoms guaranteed by the treaty justify, on occasions, treating human beings like dogs, resorting to torture or to degrading treatments? It is no doubt in keeping with the Law and Economics doctrine (which, in best Marxist tradition, founds the law in the calculation of economic worth and gives pride of place to the notion of “human capital” (28) but it is certainly contrary to the deep meaning of the principle of dignity which establishes an order of values that cannot be reduced to monetary value. And it is no good telling us that dignity thus understood amounts to “bigotry” negating the enlightenment (29). It is the father of Enlightenment, the great Kant himself who gave it its most famous definition: “In the kingdom of ends everything has either a price or a dignity. What has a price can be replaced by something else as its equivalent; what on the other hand is above all price and therefore admits of no equivalent has a dignity.” (30). The idea of a value that could elude quantification and transcend monetary evaluation is just inadmissible in a communist market economic system. Such a system rests on the calculation of utility and the general equivalence of humans and things. Much is made of the principles of dignity and of individual fundamental rights – indeed, but kept on a plane with economic and monetary rights and freedoms. The insistence on this equivalence is unavoidable in a dogmatic order that treats human beings as “human asset” and national laws as products competing on the European market. July 2008 Notes (1) This text enlarges on a short article published in the daily Le Monde 25 January 2008. (2) A major daily with a strong suit in business matters reported these judgments under the headline: “Europe legitimates social dumping” (Le Figaro, 19 Dec. 2007). (3) Cf. the final provisions of Article 136 of the EC Treaty, which defines the social aims of the European Community: The provisions of this article shall not apply to pay, the right of association, the right to strike or the right to impose lock-outs. NB: Citation trouvée à l’article 137 http://eur-lex.europa.eu/en/treaties/dat/12002E/htm/C_ 2002325EN.003301.html (4) Cf. §40 and 41 of the Viking Judgment: “even if, in the areas which fall outside the scope of the Community’s competence, the Member States are still free, in principle, to lay down the conditions governing the existence and exercise of the rights in question, the fact remains that, when exercising that competence, the Member States must nevertheless comply with Community law (…) Consequently, the fact that Article 137 EC does not apply to the right to strike or to the right to impose lock-outs is not such as to exclude collective action such as that at issue in the main proceedings from the application of Article 43 EC.” (5) The Court has retained the possibility of such a legitimate motive in the Viking case and asked the national judge to check its validity. For an in-depth study of this judgement, see P. Chaumette, “Les actions collectives syndicales dans e maillage des libertés communautaires des entreprises [Collective action in the mesh of the Four Freedoms]”, Droit Social, February 2008. (6) Clearly, such practices can only throw discredit on the lessons of democracy Europe so generously lavishes on the rest of the world – especially when associated with the rejection of the winners of free elections when they are not those the “international community” wished elected. (7) Cf. on this point the telling formulation of the Laval judgment: “The abolition, as between Member States, of obstacles to the freedom to provide services would be compromised if the abolition of state barriers could be neutralised by obstacles resulting from the exercise of their legal autonomy by associations or organisations not governed by public law (i.e. the trade unions)”. (8) CJEC 21 September 1999, case C-67/96 Albany Ecr. P.I-5751, point 60: If (the dispositions) of the Treaty (…) are construed as an effective and consistent body of provisions, it follows that agreements concluded in the context of collective negotiations between management and labour, in pursuit of social policy objectives such as the improvement of conditions of work and employment, must, by virtue of their nature and purpose, be regarded as falling outside the scope of Article 85(1) of the Treaty. (prohibiting agreements aimed at restricting competition). (9) P. Anderson, « Depicting Europe », London Review of Books, 20 sep. 2007. (10) F.A. Hayek, Law, Legislation and Liberty, vol. 3 : Political Order of a Free People, University of Chicago Press, 1979. (11) “So long as it is legitimate for government to use force to effect a redistribution of material benefits (….) there can be no curb on the rapacious instincts of all groups”, F.A. Hayek, op. cit. (12) An ever increasing part of the population of the Western World grow up as members of large organizations and thus as strangers to those rules of the market which have made the great open society possible. To them the market economy is largely incomprehensible; they have never practised the rules on which it rests, and economy is largely incomprehensible; they have never practised the rules on which it rests, and its results seem to them irrational and immoral (...)In consequence, the long-submerged innate instincts have again surged to the top. Their demand for a just distribution in which organized power is to be used to allocate to each what he deserves, is thus strictly an atavism, based on primordial emotions. F.A. Hayek, op. cit., underlined by the author. The idea that Community questions are beyond the people’s grasp and must therefore never be put to it again seems today shared by most of the European elites and there is not a government left wishing to put them to the vote. (13) F.A. Hayek, op. cit., “The Containment of Power and the Dethronement of Politics”. (14) F.A. Hayek, op. cit. (15) Mrs Thatcher whose political action answered the TINA (there is no alternative) principle reportedly brandished one day in the House The Constitution of Liberty declaring ‘This is what we believe’ (cf. Susan George, Hijacking America, Polity Press 2008). Recently asked what her greatest political success was she allegedly answered “Tony Blair”. (16) Concept developed by the World Bank via its Doing Business program. V. H. Muir Watt: Economic aspects of international private law (Analysis of 21st century Impact of economic Globalisation on the roots of law and jurisdiction conflicts), The Hague Academy of International Law, lectures collection t. 307 (2004), Leiden/Boston, Martinus Nijhoff, 2005, 383 pages ; G. Canivet, M.-A. Frison-Roche et M. Klein (dir.) Mesurer l’efficacité économique du droit [measuring the Economic efficacy of the Law], Paris, LGDJ, 2005 A. Supiot, Le droit du travail bradé sur le marché des normes [Labour law sold out on the norms market], Droit Social 2005, pp. 1087-1096. (17) The exact phrase (as it can be read at Article 15 of the Constitution of The People’s Republic of China is shehuizhuyi shichang jingji which literally translated means “socialist market economy”. The accepted meaning of the word “socialist” and its association with mixed economy models that have had currency in the West made me opt for translating by “communist market economy”. (18) The Gosplan (State Committee for Planning) and all the institutional machinery it controlled, established the production objectives for every USSR economic agent. All economic agents activity was measured against quantitative targets unrelated to the satisfaction of the population’s real needs or the quality of the goods. (V. A. Gourevitch, Économie soviétique. Autopsie d’un syst�