Articles by Dr. Shiva

THE FOOD CRISIS AND REGULATORY SCHIZOPHREMA

by Dr. Vandana Shiva
April 14, 2008

A decade and more of corporate globalisation has devastated agriculture worldwide with the promise of cheap food. Yet the very forces and processes which have launched the globalisation project are taking food beyond people's reach. Prices of food are rising worldwide. More than 33 countries have witnessed for riots.

India has had very high increases in prices of essential commodities. All kinds of reasons are being thrown around, including population growth. These are outrageous explanations. Prices have doubled over the past year, population has not. Population increase is clearly not the primary driver of high prices. Another explanation given by the Minister of Civil Aviation was that North Indians are eating more rice and South Indians are eating more wheat. This too does not square up as a reason for increase in food prices.

The uncontrollable rise in food prices is clearly an outcome of economic policies framed within the neo-liberal paradigm. The Government has intervened at every step to create corporate monopolies in the food system - from seed, to domestic production and trade, to food processing, to liberalized imports, to export oriented agriculture, to corporate retail. While Government intervention has unleashed forces driving up food prices, the government is now throwing up its hand and says it can do nothing to control prices. At the Global Agro-Industries Forum meeting on April 11, 2008 Prime Minister Manmohan Singh said a steep rise in food prices would make inflation control more difficult and might hurt macro-economic stability but he ruled out return to an era of blind control to check prices (Hindu, April 11, 2008). "We cannot react to such a situation by returning to an era of blind controls and by depressing agriculture terms of trade" is what the Prime Minister said (Business Standard, 13.4.08). After having shaped ecnomy which is leading to high cost food for the poor, the Prime Minister has said he believes in running a "hands off economy". This is putting the economy on autopilot for corporate control of food systems.

The Science & Technology Minister, Kapil Sibal said the Government had no role in the price rise and there was no magic wand to bring down prices, even though the government has repeatedly used the "magic wand" on behalf of corporations to drive up the food prices (Hindu, 13.4.08 and Indian Express 12.4.08). "Prices touch three year high, no magic wand says Government" (Hindustan Times, 12.4.08).

This is regulatory Schizophrema. Government intervention is good desirable and necessary if it is on behalf of corporate profits, it is bad and undesirable if it is on behalf of the food and nutrition rights of the poor and livelihoods rights of poor peasants.

There are nine factors driving food prices upwards.

The first is the integration of India's food economy with global commodity trade under pressure of WTO and the bilateral U.S - India Agriculture Agreement.

The Government is importing wheat from Cargill at more than $400/ton, while it refuses to increase the MSP to farmers above Rs. 1000/- on grounds that this will create inflation. Is inflation created by Rs. 1000/- domestic wheat or Rs. 16000/- imported wheat?

The Commerce Minister reduced import of edible oil duties to zero. And the Finance Minister announced import of one million tones of edible oil by Government to be sold with Rs. 15/litre subsidy. He also announced import of 1.5 million tones of pulses. This will further destabilise domestic production and further erode food security.

The second is the integration of the food economy with the volatile, speculation based financial economy driven by agribusiness, hedge funds and investment banks.

The third is a major diversion of land and food to produce industrial biofuels. India plans to put 11 million hectares under Jatropha for biodesel. The sugar industry is all set to convert sugarcane to ethanol, which would mean another 4 million ha out of food production. And Tata's has just set up a sweet sorghum based ethanol plant in Maharashtra. The Finance Minister, at the Washington meeting of World Bank/ IMF has said governments of rich countries should stop providing biofuels. He should also apply this prescription to himself and stop subsidizing jatropha cultivation on farms that grow paddy in Chattisgarh and grazing lands that provide fodder for livestock in Rajasthan.

The fourth is climate extremes caused by climate change which has led to crop damage in Australia and Bundelkhand due to extended drought, and crop damage in Kerala's rice bowl, Kuttanad with extensive rains. Twenty five percent of all greenhouse gases including N2O, CH4 and CO2 come from green revolution agriculture, which is being proposed as a solution to the food crisis in Africa. More CHG's mean more drought. More drought means less food.

The fifth is large scale diversion of food growing land to export oriented cash crops. 8 million hectares of area under food grains has been diverted to export crops under the trade liberalization policies. Agriculture export zones are part of a "control command economy" directing the farmers to give up food grain production and go in for export crops of vegetables, fruits and flowers. This is also part of the perceived division of labour under globalisation, where the rich North grows food staples for the South, and the South grows luxury products for the North.

In the early days of globalisation, the then Agriculture Secretary had said "Food Security is not food in the godowns but dollars in the pocket". Tragically, the dollar is collapsing in the financial meltdown, and the food we were expected to buy is being diverted to produce biofuel to run cars. This model of food security no longer works.

We have witnessed what importing food is doing to our food security.

Imports are no longer affordable, and a model based on import dependency might be in the interest of Cargill, or the U.S Government which has always used food as a weapon. It is definitely not in the interest of India's food sovereignty, nor in the interest of the 70% of India already denied access to adequate food.

A sixth reason for price rise is the dismantling of the universal PDS system which kept prices under control and its replacement by the targeted PDS which has failed to serve the poor or failed to bring down costs.

Food stamps is not a solution. It is a corporate recipe which denies farmers their livelihoods through their role as food producers and food providers. In any case, in the context of constantly rising prices, food stamps will only be pieces of paper, not food in hungry stomachs.

A seventh driver of price rise is the entry of giant corporations like Cargill, AWB, Conagro, ITC, Levers, in procurement through creation of private mandis by changing the APMC Acts and by opening up food retail to corporate giants like Reliance, Metro, Walmart as well as promoting industrial processing through the Food Safety Act. The Monoponistic conditions these big corporations create leads to a scarcity in the low cost open market economy based on small traders and small retailers.

Ironically, while the government is legalizing hoarding in private mandis and giant warehouses of giant corporations, it has unleashed a reign of terror gainst small traders in the name of preventing hoarding, using the food crisis to further dismantle India's food democracy and food sovereignty, and further strengthen food monopolies. Food trade includes storage. Storage is not hoarding. Holding back supplies for speculation is. And that is what the private mandis are doing.

The eighth driver of the food crisis is large-scale diversion of fertile farm land for Special Economic Zones and the constant refrain that farmers must be removed from the land for industrialization.

This government intervention on behalf of corporations must be reversed if India's food security is to not be irreversibly compromised. In a period of high cost food and looming food scarcity, the first priority must be protecting our farmers and our fertile soils.

The ninth driver of the food crisis is a false model of "productivity" increase based on fossil fuels, high cost inputs, such as patented GMO seeds and chemical fertilizers. These industrial farming models use more energy than they produce as food, and they produce less food than biodiverse, eological farms. To overcome the food crisis, we need to maximize nutrition per acre while minimizing fossil fuel input. The green revolution and the second green revolution fail on both counts. They do not maximize nutrition output, and they are dependent on fossil fuels which are becoming more costly and also contributing to climate change which is threatening food security.

Unfortunately, the government is offering the disease as the cure It is using the food crisis to further impose non-sustainable models on farmers which are trapping them in debt and denying them the potential to use their lands to produce healthy and nutritious crops.

As the Prime Minister stated, the rising food prices needs "a second green revolution" (creative solutions needed to combat current food crisis, Business Standard, 13.4.08). The second green revolution refers to genetically engineered seeds added to the green revolution package of intensive chemicals and water use.

Farmers suicides in the G.M Bt. Cotton belt, especially Vidharbha, shows that genetic engineering is not a "magic wand", it is not a "creative" solution to the agrarian crisis or the food crisis. The creative solution is biodiverse ecological farming which is increasing food output while lowering costs of production.

The government must end its regulatory schizophrema of making laws and policies to benefit corporate monopolies, and pretending it cannot intervene in the "market" of corporate monopolies which it has created and maintained through regulation and policy. The government needs to undo the harm it has done to farmers by driving them to suicide and to the poor by driving up food prices.

The real creative solutions that the current food crisis demands are -

1. Stop policies to encourage unnecessary imports, stop reducing import duties on products Indian farmers can produce. Introduce QR's. If the government can introduce export bans to manage prices, it must introduce import bans to protect farmers and regulate prices.
2. Stop policies that encourage futures trading and linking of peoples food rights with speculation in a global financial casino.
3. Stop diverting farmland and village common lands and grazing grounds to Jatropha for biofuel. Stop the diversion of sorghum and sugarcane to ethanol.
4. Stop promoting chemical fertilizer and fossil fuel based green revolution agriculture to mitigate climate change.
5. Stop policies that promote diverting food growing land to luxury export crops such as flowers and exotic vegetables.
6. A democratically controlled decentralized PDS system that guarantees food security for all is vital both to guarantee, secure and fair markets to producers and affordable, safe food to all.
7. Stop amendments of APMC Acts to create private mandis. Treat privte mandis as large scale hoarding violative of the essential commodities act. Stop passing laws to allow entry of the corporations into retail. Stop providing subsidies to industrial processing.
8. Stop appropriating fertile farmlands for SEZ's The SEZ Act should be scrapped and farmlands should be protected for food security.
9. Stop deregulating India's biosafety laws to promote GMO's. Scrap the U.S _ India Agriculture Agreement which is foreclosing India's options to do research on ecological, farmer centered strategies to increase food production. Promote ecological / organic farming to simultaneously address the agrarian crisis and the food crisis.

No where in the Constitution is it said that the duty of the government is to protect "economic reforms" and trade liberalization even as people die. The Prime Minister has referred to introducing changes in the laws and policies for trade liberalization as "blind control". The Constitution does have a clearly articulated Art. 21 that states that the state must protect the right to life of all its citizens.

Denial of food is denial of the right to life. Ensuring safe, good, and affordable food for all is central to protecting the right to life. This is not "blind control" but a Constitutional obligation of the state. And it is the Constitution and people's rights enshrined in it which must guide policy, not blind adherence to a failed and false paradigm of trade liberalization and state intervention for corporate welfare.

As Ulrich Beck has written in a recent article on the financial crisis "A farce which shows how badly we need the state - "World Risk Society - The Play… Dramatis Personae are the hardcore neo-liberals who in the face of danger have overnight converted from the market faith to the state faith. Now they are praying, begging, pleading for the mercy of state intervention and multi billion dollar handouts of the taxpayers money….only one opponent of the free market remains : the unbridled free market itself" (Hindu, 10th April, 2008).

We cannot have state intervention to secure the profits and monopolies of corporations and refuse state intervention to secure food for the poor and hungry. This is regulatory schizophrema. And the price people are paying for this government's schizophrema is now becoming too high.