An Interview wth Susan George

In How the Other Half Dies: The Real Reasons for World Hunger, first published in the U.S. in 1977, Susan George put forth the thesis that hunger and starvation in the third world are caused by the international agribusiness corporations and their allies: multilateral lending institutions like the World Bank, Western governments, and local third world elites.

"Hunger is not a scourge," she wrote, "but a scandal." She depicted the multinational food industry as a Midas gone dreadfully wrong. "Agribusiness is capable of destroying everything it touches: local employment patterns, local food-crop production, consumer tastes, even village and traditional family structures."

George, who is a fellow of the Transnational Studies Institute and lives in Paris, visited Washington in late January. There she spoke with Patricia Perkins and Matthew Rothschild of the Monitor staff.

What role are agribusiness companies currently playing in the global food industry?

The companies are transforming the food systems of other countries in order to fit the needs of predominant countries, particularly the United States, whether to serve as markets for Western goods or as suppliers of agricultural raw materials for the food systems of the West.

Can you give a specific example?

Take the area of animal feeds. There's a huge thrust, which I think is very important, to bias the diet of third world countries toward a much more meat-based diet, because in this way you sell much more soya and corn, and you can sell more processed animal feed.

There have been any number of projects geared to chicken promotion, which involves feeding the chickens processed feeds and is a very dependency-creating industry because you're perpetually hooked up to a kind of a diet not based on your local available foodstuffs. You create a demand which depends on imports.

In Algeria, an extreme case, 85% of all of the basic foodstuffs of the country are imports. Nonetheless, the government is encouraging a much more meat-based diet, including chicken and beef, and it is destroying the local olive oil industry by importing soya oil.

The olive oil industry in Algeria is just dying. It's a very decentralized industry, with each farmer having seven or eight olive trees and little mills dotted around the countryside. The man who's in charge of the national olive oil industry was practically crying when I talked to him. He said, "If they'd just raise the price of soya oil by a few centimes - it's been the same price for 20 years - I could renovate 500 mills a year."

What was the staple diet of Algeria before the entry of agribusiness companies?

It was couscous, based on wheat and sometimes barley. Couscous is like many local foods, it is prepared communally, by women working together on a porch, rolling it out; it is a sort of social activity. But now, that's too much work and too time-consuming, so you get instant couscous or you get something else: bread. It's taking over the world. Bread's a wonderful capitalist food in the sense that it can be consumed separately; you don't have to get together at lunch to eat it like rice or the various other communal dishes that take time to cook.

Brazil is another classic example. There large amounts of agricultural land were converted over the last 15 years from black beans and corn production to soybean production. The Brazilian government got scared around 1975, 1976 when people rioted because they couldn't buy beans. About 200,000 people voted in municipal elections for black beans instead of a candidate: they just wrote "black beans" on the ballots. The government began to get worried, and instituted a rule requiring soya producers to devote 10 to 15% of their land to black beans.

What multinational companies are involved in that transformation process in Brazil?

Oh, they're all there. Continental, Archer-Daniels, Cargill, Central Soya.

How would a multinational go about changing the production bias in a country like Brazil?

Well, the multinational doesn't change it by itself. What changes it is the prices, the relative prices that are being offered for these different crops.

Farmers convert because the export crop is lucrative, and because the government's been calling for exports and the incentive to produce is higher. Also the World Bank contributes to making very efficient transportation networks to get the soya beans to the processing plants and to the ports. In some cases, there are private corridors, road and rail networks, devoted entirely to the transportation, processing and efficient handling of soybeans.

So, when you get all the infrastructure, the price incentives and the government credits, it's stupid not to produce it, from the farmer's point of view.

Why have agribusiness corporations increasingly opted for contract farming - letting local farmers own the land and buying the goods these farmers produce - rather than directly controlling the land and production?

It is less efficient to have direct control of your land through ownership. Land is the first thing to be nationalized under political pressure, and it involves a number of fiscal problems and taxes that corporations don't want to get into. Perhaps most importantly, they don't want to be burdened with plantations producing a raw material that costs them more to use than another raw material purchased on the open market. With contract farming, they have much greater flexibility.

Now the world markets are so integrated that a company like Unilever is able to purchase any kind of oil from any source and make exactly the same kinds of soaps or margarine - it doesn't matter to them, the technology is exactly the same. Because soy oil from the U.S. at some point could be much cheaper than even palm oil produced on a Unilever estate with low-paid workers, it's quite possible that Unilever could be more interested in the soy oil than the palm oil.

What is the relationship between the large landowners and the rural poor in developing countries?

Anybody in this country who thinks that class struggle is something that was invented by an unmentionable 19th century economist should go to Bangladesh. While I was there recently, I was talking with some people who are doing wonderful work, on a $40,000 a year budget, in organizing groups in rural areas to take over land which is fallow and which legally is supposed to serve the needs of landless people. Whereas in fact, it's usually the large landowners who take it over and use it to graze animals or cut wood there. While I was talking to these organizers, they got a call from one of their people, saying that goon squads from the landowners had come the previous night and trampled and torn up the potato field and were threatening to burn up the training center and the organizers' house. It's raw class struggle; it's really just naked violence.

What strategy can third world countries adopt so that they receive more of the benefits of their resources? Do you agree with the United Nations Commission on Trade and Development (UNCTAD) that third world countries should form commodity cartels to increase the revenues from their export goods?

Commodity cartels are not workable, because there's always some poor country that's desperate for foreign exchange and will undercut whatever agreement was made on a particular price.

I'm not very big on state strategies now. I think that, yes, it's important for third world countries to get more control over markets. But I'm much more interested in what sorts of guarantees we will have that any incremental improvements in those incomes are actually going to benefit the people in the third world. Income distribution in Guatemala, or Honduras, or Brazil, or many of the African countries, is worse than is in this country, where God knows it's bad enough already.

I don't believe in trickle down. I think there's a need to go beyond that strategy, which is the strategy of the Brandt Commission, of the New International Economic Order, and to face up to the problem of how does one get control of the means of production, and then how does one get control of the markets.

Agro Tech's Aggressive Sales Force "We must all realize American business should not lead or fallow the American flag, but must go abroad draped in the American flag." So said Malcolm Baldrige, U.S. Secretary of Commerce, upon returning from a trip with U.S. businesspeople to west Africa in mid-January. Baldrige was joined by Secretary of Agriculture John Block, Export-Import Bank President William Draper, and the President of the Overseas Private Investment Corporation, Craig Nalen. This top-level government delegation escorted 26 corporate executives to Nigeria, Cameroon, and Morocco. The companies represented ranged from such agribusiness giants as the Louis Dreyfus Corporation and Allis-Chalmers to smaller agricultural firms like Agro Tech International. Corporations in the construction engineering, mining and mineral extraction, and telecommunications sectors also went on the trip. One of the American firms to benefit most from the trip was Agro Tech International, a Miami-based company specializing in poultry feed and chicken raising. Agro Tech "signed letters of intent" for five contracts, said Francisco Hernandez, President of the company. The agreements would allow Agro Tech to produce up to 50 million chicks and 50 million broilers annually. "We accomplished in 14 days what it would have taken two years and $200,000 to do" without the help of the U.S. officials, said Hernandez.