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T H E I N T E R NAT I O NA L P O L I T I C A L

ECONOMY OF FOOD: 25

A GLOBAL CRISIS

HARRIET FRIEDMANN

International conflict over agricultural regulation for more than six years threatened
to collapse the whole Uruguay Round of the General Agreement on Tariffs and Trade
(GATT), and with it an agreement that greatly extends corporate power relative to
national (and public) power. At issue, paradoxically, was a type of national regula-
tion of agriculture whose days were already numbered. Even more paradoxically,
Europe, cast as defender of the old ways, had committed itself to more basic domes-
tic reform than the United States. Major changes initiated in the European Common
Agricultural Policy have gone further than anyone imagined possible at the outset
of the Uruguay Round (1). The choice in 1994 is not between “regulation” or “free
trade,” therefore, but between new forms of implicit or explicit regulation.
Copyright © 2002. Taylor & Francis Group. All rights reserved.

In and around the tangled web of national politics, European and North
American integration, and international economic competition, new protagonists
were taking shape. The contest over new rules and relations for food and agricul-
ture also depends on transnational corporations and popular movements not for-
mally present at the negotiations. Agricultural support programs were put in place
roughly half a century ago in response to farm politics. Since then, farms have
become suppliers of raw materials within a transnational agro-food sector domi-
nated by some of the largest, most technically dynamic corporations in the world.
At the same time, urbanization and the rise of social movements expressing inter-
ests of consumers, environmentalists, and others have shifted the focus from farm
incomes to other interests.
In the long view, it is clear that the agricultural trade conflicts inside and out-
side the GATT were the culminations of long-term structural and interstate changes.
The rules implicitly governing agro-food relations were established in the years
immediately after World War II and worked stably enough for nearly 25 years to jus-
tify the idea of a “food regime.” However, new relations were forged during that time,
which by the early 1970s began to undermine the international relations of food.

Food in the USA : A Reader, edited by Carole. Counihan, Taylor & Francis Group, 2002. ProQuest Ebook Central,
http://ebookcentral.proquest.com/lib/uhm/detail.action?docID=1487202.
Created from uhm on 2024-12-13 05:57:27.
Food in the USA

In this article, I analyze the rise of a food regime and the emergence of contra-
dictory and conflictual relations within it. First, I define the food regime and its main
features. In the second section, I describe the character of the food regime, includ-
ing its internal tensions, between 1947 and 1973. In the third section I describe the
emergence of new relations and new rules after the food crisis of 1972–1973. To sim-
plify the story of the regime and its crisis, in these sections I treat states, particu-
larly the United States, as integral actors. In the final part of this essay, I explore the
residual and emergent relations which make possible either new regimes, or the
descent into deeper disorder.

W THE FOOD REGIME: PRINCIPLES AND CONTRADICTIONS

W 326
The impasse in international economic relations is centered on agriculture because
in the agro-food sector there exists the largest gap between national regulation and
transnational economic organization. This gap is the legacy of the post–World War II
food regime, the rule-governed structure of production and consumption of food on
a world scale. The food regime was created in 1947 when alternative international
regulation in the form of the proposal for a World Food Board was rejected (2). At
the GATT, the only clear positions are those which “decouple” and “deregulate” ele-
ments of a food regime that no longer works. The present alternatives for a new
regime are not formally proposed. They must be teased out from analyses of the
social forces involved in global agro-food restructuring.
The postwar food regime was governed by implicit rules, which nonetheless
regulated property and power within and between nations. The food regime, there-
fore, was partly about international relations of food, and partly about the world
food economy. Regulation of the food regime both underpinned and reflected
changing balances of power among states, organized national lobbies, classes—
farmers, workers, peasants—and capital. The implicit rules evolved through practi-
cal experiences and negotiations among states, ministries, corporations, farm lob-
bies, consumer lobbies and others, in response to immediate problems of produc-
tion, distribution and trade. Out of this web of practices emerged a stable pattern of
production and power that lasted for two and a half decades.
The rules defining the food regime gave priority to national regulation, and
Copyright © 2002. Taylor & Francis Group. All rights reserved.

authorized both import controls and export subsidies necessary to manage

national farm programs. These national programs, particularly at the outset of U.S.
New Deal commodity programs, generated chronic surpluses. As these played out,
they structured a specific set of international relations in which power—to restruc-
ture international trade and production in one state’s favor—was wielded in the
unusual form of subsidized exports of surplus commodities. In this way agriculture,
which was always central to the world economy, was an exceptional international
sector.
Then, the “food crisis” of the early 1970s, combined with simultaneous money
and oil crises, initiated a period of instability from which we have not yet recovered.
The sense of crisis in the early seventies stemmed from the sudden, unexpected
shift from surplus to scarcity, which sent grain prices soaring and threatened food
shortages for poor people and, most of all, for poor countries. In retrospect it is
clear that since the shortages came from a one-time explosion of demand and a tem-
porary drop in production, the basic cause of surpluses was bound to reassert

itself. Since major states continued to support agricultural prices by purchasing

commodities, within a few years farmers produced more surpluses, and states
resumed mercantile trade practices to get rid of them.
With the reappearance of surpluses, most commentators abandoned the idea of
crisis and focused on ever shorter time horizons. Old policies designed to deal with
surpluses once again seemed appropriate, and problems with those policies were
not connected to the long trajectory of international food relations since 1947 (for
an exception, see 3, pp. 17–30). However, disappearance of the symptom simply
masked survival of the disorder. Like a kaleidoscope turning, new relations which
had emerged within the regime became significant enough to alter the pattern. Old
practices, especially surplus disposal in foreign markets, could not reconstruct the
original relations of power and property. Food aid or other forms of export subsidy,

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which once underpinned the food regime, came instead to express intense interna-
tional conflicts.

327
W T H E S U R P LU S R E G I M E , 1 9 4 7 – 1 9 7 2

Because the United States protected its own domestic markets, other countries
were constrained to adopt similar agricultural policies focused on the national mar-
ket. U.S. trade restrictions, designed to protect domestic farm programs, encour-
aged other states to focus on their own national agro-food sectors. States replicated
the U.S. regulation of national sectors, but adapted policies to their locations in the
food regime. For Continental Europe, this meant shifting the focus of protective agri-
cultural policies away from tariffs, and redesigning trade protection around domes-
tic support for farm prices. For other parts of the world, adaptation of the U.S.
model involved parallel shifts in the forms of state agricultural regulation. Thus, the
postwar rules did not liberalize national agricultural policy, but created a new pat-
tern of intensely national regulation.
At the same time, the free movement of investment capital tended to integrate
the agro-food sectors of Europe and the United States into an Atlantic agro-food
economy. This tension framed the new roles of tropical export countries, including
former European colonies, in the food regime. This integration, moreover, was
uneven. It did not include the countries of the socialist bloc, and, despite high levels
Copyright © 2002. Taylor & Francis Group. All rights reserved.

of aid and trade, the capitalist countries of Asia were not integrated into transna-
tional agro-food complexes.
Thus the postwar food regime was built on a tension between the replication
and the integration of national agro-food sectors. The tension between replication
and integration reflected on an international scale the problem inherent in U.S. farm
programs—chronic surpluses.

The United States at the Center

Paradoxically, the main challenge to present rules comes from the source of those
same rules in the early postwar years—the U.S. state. New Deal farm programs of
the 1930s were retained after World War II despite widespread awareness of the
problem of surpluses. Mercantile practices had to be used to dispose of the sur-
pluses and to prevent a flood of imports into the United States. As the dominant
economic power after World War II, the United States insisted on international rules

consistent with its own national farm support programs. These rules eventually
allowed the United States to create an overwhelming preponderance in world agro-
food production and trade, far beyond its historic share (4).
Yet mercantilist agricultural policy was in conflict with the larger U.S. policy to
promote free movement of goods and money internationally (5). Because of its
weight in creating international institutions after World War II, U.S. decisions trans-
ferred this tension to the food regime as a whole.
The food regime was created by a series of decisions between 1945 and 1949,
which reflected U.S. determination to protect the import controls and export subsi-
dies which, as we shall see, were a necessary complement to its domestic farm pol-
icy. U.S. commitment to mercantile agricultural trade practices led to the sacrifice of
multilateral institutions which had wide support among postwar governments, not

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only for regulating food, but also for the pursuit of the larger U.S. agenda for liberal
trade. The World Food Board Proposal, which provided for global supply manage-
ment and food aid through the FAO (Food and Agriculture Organization), was
328 rejected by the United States and Britain at an international conference in
Washington, D.C., in 1947. The Havana Treaty creating an International Trade
Organization, a 1946 initiative by the U.S. Department of State, was never formally
submitted to Congress because it contradicted mercantile clauses in U.S. domestic
farm laws. Even the GATT, which began as an ad hoc negotiating forum intended to
be subsumed under the formal powers of the anticipated International Trade
Organization, and continued as a feeble substitute in its absence, excluded agricul-
ture from its ban on import controls and export subsidies, at U.S. insistence (5).
The need for trade controls stemmed from an odd feature of domestic farm pro-
grams, where, instead of direct income support, New Deal price supports tried to
raise farm incomes indirectly by setting a minimum price for commodities named in
the legislation, and maintaining this price through state purchases. Government
purchases to support prices encouraged farmers to produce as much as possible.
Legislation to limit production by restricting acreage was never effective. In fact,
insofar as they encouraged farmers to remove their worst land from production,
acreage controls tended to increase productivity.
Surpluses mounted more persistently with the technological developments
involved in the industrialization of agriculture. Industrialization subordinated farms
to emerging agro-food corporations, both as buyers of machines, chemicals, and
Copyright © 2002. Taylor & Francis Group. All rights reserved.

animal feeds, and as sellers of raw materials to food manufacturing industries or

livestock operations. Profits in the agro-food sector depended on the larger restruc-
turing of the postwar economy toward mass production and mass consumption
(6–8), especially increased consumption of animal products and high value-added
manufactured foods, or what might be called “durable foods” (9).
Commodity price support programs both protected family farms and encour-
aged their relations with agro-food corporations. By supporting prices, the legisla-
tion rewarded large family farms. Farms increased productivity and scale through
technologies bought from key vehicle and chemical industries. As they became
locked onto a technical treadmill, they also became increasingly specialized. The
most important shift was the separation of intensive livestock from cereal produc-
tion, and with it the growth of the two most important crops of the “second agricul-
tural revolution,” hybrid maize and soy. Capital-intensive manufacture of soy-maize
animal feeds allowed corporations to place themselves between increasingly spe-
cialized intensive livestock operations, which were their customers, and maize and
soy farms, which sold to them (10). At the same time, mass production of durable

foods required standard agricultural raw materials, which corporations obtained

through contracts with increasingly specialized and standardized farms (11, 12). As
durable foods came to be made from generic ingredients, such as sweeteners, fats,
and starches, corporations were able to reduce their dependence on specific prod-
ucts and increase the possibilities for substitution (13).
The key to the persistence of the world food regime was the innovative U.S. pol-
icy of foreign aid, combined with import controls. Domestic agricultural price sup-
ports required import controls and export subsidies. Without controls, high domes-
tic support prices would attract imports. Apart from its negative impact on hungry
people abroad, especially war-torn Europe, this meant that without import controls,
the Commodity Credit Corporation, a U.S. government agency, would have to buy
ever greater quantities of world supplies to maintain the incomes of U.S. farmers.

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Moreover, the more it bought, the greater was the gap between support prices and
residual “market” prices. Government stocks put a downward pressure on prices by
keeping supply (or potential supply) high. This created fiscal problems for the state
budget, which had to pay support prices plus storage and disposal costs. Since the 329
destruction of surplus agricultural products was politically unacceptable in a hun-
gry nation (and world), commodity price support programs required a way to dis-
pose of surpluses without lowering prices, that is, outside “markets.” These were
found through domestic public distribution, such as food stamps and school
lunches, and through subsidized exports to other countries in the form of “aid.”
Aid allowed the United States to turn the problem of surplus stocks into an oppor-
tunity to pursue strategic, welfare, and economic policies. Yet aid did not simply inte-
grate donor and recipient. As a mercantile trade practice, aid encouraged recipients
and competitors alike to adopt the national regulation of agriculture and trade. Thus
replication was built into the international food economy at the same time.
In other words, what is frequently called the “export of the U.S. model” of both
production and consumption (14–17) was the outcome of specific practices in the
postwar food regime. At the same time, these practices also reflected historical
experiences, so that the effects were quite distinct in Europe, the emergent third
world, and as we shall see later, in Japan. In Europe and the third world, new links
with the United States revolved around trade in wheat, animal feeds, and raw mate-
rials for food manufacturing.
Copyright © 2002. Taylor & Francis Group. All rights reserved.

Europe and the Atlantic Pivot

Marshall aid to Europe simultaneously established the basis for Atlantic agro-food
relations, and invented the specific mechanisms of foreign aid which were later
adapted to the third world. For European agriculture, the tension between national
regulation, with attendant surpluses, and liberal trade was reflected first in Marshall
aid and later in the Common Agricultural Policy. The United States supported the
European protection of wheat and dairy products, even at the very high level
needed to keep out efficiently produced and subsidized U.S. exports. In return, the
European Community exempted maize and soy from the import controls of the
Common Agricultural Policy (10, 18).
Under the Marshall administration, dumping was secondary to recovery. U.S.
legislation required the use of Marshall funds to buy U.S. surplus commodities at
specified rates as much as 50 percent below the domestic price; it balanced the con-
tradictory interests of reconstruction and dumping by specifying maximum and
minimum quantities to be disposed of in recipient countries. U.S. Marshall adminis-

trators, however, minimized agricultural dumping, as they understood it to be (5).

The 40 percent of Marshall aid that went to food and agriculture in Europe was con-
centrated upon imports of feedstuffs and fertilizers for agricultural reconstruction.
The balance shifted after 1954, when surpluses were redirected to underdeveloped
countries in the form of food aid (19).
However, as soon as agricultural reconstruction showed some success, West
European farmers sought U.S. markets for their dairy products. Congress then
imposed import quotas on dairy (and a whole range of other) products. This,
despite the fact that even with high support prices, imports of dairy products
accounted for less than 1 percent of the U.S. market. The ability of special interests
to override U.S. interests in trade relations with Europe can only be understood in
the ideological context of the Cold War. The farm lobby got its import restrictions

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not through agricultural legislation but through an amendment in the Defense
Production Act of 1950. In 1952, the Act was amended to enable the U.S. Secretary of
Agriculture to defend the country against any import which endangered national
330 security, from Danish cheese to Turkish sultana raisins (5).
Despite protection, the openness to direct investment by U.S. transnational cor-
porations helped to integrate European and U.S. agro-food sectors via industrial
inputs and processing. Both in promoting meat-intensive diets and in organizing
intensive livestock production, agro-food capitals shaped agricultural reconstruc-
tion along lines similar to the United States. Most important was investment in an
intensive livestock sector relying on industrial feedstuffs composed from soy and
maize. This linked apparently national agricultures to imported inputs. Beneath the
protected surface, therefore, lay the corporate organization of a transnational agro-
food complex centered on the Atlantic economy. It linked North America, especially
the United States, to Europe (10).
The combination of the freedom of capital and the restriction of trade
shaped agricultural reconstruction so that it created a new relationship
between European and U.S. agro-food sectors. A decade later, the
Common Agricultural Policy of the European Economic Community
introduced a similar form of agricultural support to that in the
United States. To achieve import substitution in the face of chronic
U.S. surpluses, however, the level of protection required was very
much higher. In return for the United States’ acceptance of EEC
Copyright © 2002. Taylor & Francis Group. All rights reserved.

restrictions against wheat and dairy imports (the old products in

international trade) the EEC did not restrict the new U.S. exports,
maize and soy. The latter soon came to account for greater export
revenues than those lost with wheat (20). Both European corpora-
tions and subsidiaries of U.S. corporations in Europe contributed to a
massive growth of manufactured feedstuffs for intensive livestock pro-
duction, and a shift from domestic and colonial raw materials, such as
flax and cotton meal, to maize and soy imported from the United States.
Like other industrial sectors, the apparently national livestock industry rested
on a chain of inputs which effectively integrated a transnational sector (10, 20).
Thus European wheat replicated the national U.S. sector, while specialized
European livestock farms imported inputs from the United States, creating an inte-
grated Atlantic agro-food sector. The price support mechanism for wheat and dairy
products eventually replicated the surpluses, and with them the export subsidies to
dispose of them. By 1975 the European Community had switched from being a net
importer to a net exporter of wheat, and by 1985 France’s exports (including to

other EC members) were larger than those of the United States (21, p. 45). At the
same time, agro-industrial integration allowed European livestock producers to sub-
stitute a wide range of feed ingredients for U.S. imports and to diversify trade.
Eventually, the Common Agricultural Policy closed the circle by introducing sup-
port for domestic oilseed production, an import substitution/replication which
eventually brought the United States and EC to the brink of trade war in 1992. Thus,
trade restrictions and competitive dumping turned from the founding principle into
the enduring friction of the food regime.

The Third World

The Atlantic agro-food economy was the hinge for the reconfiguration of the food

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relations of Asian, Latin American and African countries. As third world states
sought to develop national economies, their agrarian strategies were shaped by the
opportunities and limits of world food markets. These gave little reason to question
the dominant ideologies—capitalist and socialist; modernization and depen- 331
dency—which all encouraged states to downplay agriculture except as a contribu-
tion to industrial development. For most countries, both the food supply of urban
populations and the export revenues for industrial investment were largely sought
outside traditional agrarian sectors during the 1950s and 1960s.
For the commercial food supply, U.S. wheat surpluses made imports an attrac-
tive alternative to the modernization of the domestic food sector. When the United
States lost European wheat markets, which had been virtually the only source of
import demand until the 1950s, it sought other outlets for its surpluses. It found
them in Japan, and above all in the emerging third world. Third world markets were
cultivated, despite lack of foreign exchange, through the use of food aid. The main
U.S. food aid instrument, Public Law 480, adapted the specific mechanisms invented
for Marshall aid. However, while Marshall administrators in Europe had resisted the
Congressional attempts to dump U.S. wheat because it undermined the main goal of
agricultural reconstruction (5), there was no such counterbalance for Public Law
480 aid in third world countries. Consistent imports made many third world coun-
tries dependent on cheap world wheat supplies (19).
Wheat was both a change from most traditional dietary staples and an effi-
ciently produced, often subsidized alternative to the marketed crops of domestic
Copyright © 2002. Taylor & Francis Group. All rights reserved.

farmers. Despite the Green Revolution, which replicated in the third world the
hybrid maize revolution of U.S. agriculture (22) and integrated national agriculture
into world markets for equipment and chemical inputs, the third world as a whole
became the main source of import demand on world wheat markets. Import policies
created food dependence within two decades in countries which had been mostly
self-sufficient in food at the end of the Second World War.
On the export side, tropical crops faced the notorious problem of declining
terms of trade, even when export states tried to manage world supplies (19, 23).
Two of the most important tropical export crops, sugar and vegetable oils, were
increasingly marginalized by industrial substitutes used as sweeteners and oils.
Although changing U.S. (and other advanced country) diets increased the per
capita consumption of sugars and fats, these were increasingly consumed in a new
form. Sugars and fats became intermediate ingredients in manufactured foods
rather than articles used directly by consumers.
Once industrial processes allowed for technical substitutions, the relative costs
of crops could determine which would be used as raw materials for durable foods.

The main industrial substitute for cane sugar was high fructose corn syrup, which
became economically feasible to use because of U.S. subsidies and surplus stocks of
maize. The main substitute for tropical vegetable oils was soya oil, which was a by-
product of soymeal for animal feeds. Beyond that, soya oil was the second-largest
U.S. food aid item after wheat, and was widely substituted for traditional oils for
cooking and for industry, by recipients of U.S. aid from Spain to India (23). Thus the
food regime fostered import substitution of tropical oils and sugars in the United
States and Europe, the Atlantic hinge of the international food regime.
By the early 1970s, then, the food regime had caught the third world in a scis-
sors. One blade was food import dependency. The other blade was declining rev-
enues from traditional exports of tropical crops. If subsidized wheat surpluses were
to disappear, maintaining domestic food supplies would depend on finding some

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other source of hard currency to finance imports.
The food crisis of 1973–1974 did create a sudden scarcity. It sent prices soaring
and dried up aid. Worst of all for dependent third world importers, the food crisis
332 coincided with the oil crisis. The effects included a complex differentiation of the
third world based on the new importance of paying for expensive imports of food
and energy. The solution was temporary, elegant, and dangerous. The oil revenues
deposited in transnational banks by oil-rich states were lent out extravagantly to
states desperately in need of financing food (and oil) imports.

W N E W R E L AT I O N S , N E W R U L E S , 1 9 7 2 – P R E S E N T

After two decades, the internal tensions within the food regime had begun to pose
serious problems. The replication of surpluses, combined with the decline of the
dollar as the international currency, led to competitive dumping and potential trade
wars, particularly between the European Economic Community and the United
States. This eventually made it unbearably costly for small countries, such as
Canada or Sweden, to subsidize surpluses or exports. On top of international con-
flict, transnational corporations outgrew the national regulatory frameworks in
which they were born, and found them to be obstacles to further integration of a
potentially global agro-food sector.
However, the crisis was precipitated externally by an event which permanently
Copyright © 2002. Taylor & Francis Group. All rights reserved.

breached the boundary between the capitalist and socialist parts of the food
regime. The geopolitical context for both Atlantic integration and the reorientation
of third world agro-food relations was Cold War rivalry. The catalyst of crisis in the
early 1970s, a crisis from which the regime has yet to recover, was the massive grain
deals between the United States and the USSR which accompanied Détente. The cri-
sis unfolded through a series of U.S. embargoes in response to feared shortages
throughout the seventies, followed by fierce rivalry when surpluses returned in the
eighties and nineties.

Détente and the Linking of Blocs

It will take a long time to interpret the effects of East-West relations on capitalism,
but their role in the food regime was crucial. The food relations among the United
States, Europe, the third world (and as we shall see, the Asian capitalist countries)
were only one part, though the dominant part, of the food regime. They were con-
tained by the Cold War dam which, despite leaks, divided the capitalist and the

state socialist economies. With Détente, major trade and financial links breached
the Cold War dam. It is important to underscore that nearly two decades before the
collapse of the socialist bloc and of the Soviet Union, economic ties between blocs
had forever altered international food relations.
The Soviet-American grain deals of 1972 and 1973 permanently broke the dam
separating capitalist and socialist blocs. Despite leakages, this dam had been a wall
containing the surpluses which were the pivot of the food regime. In the 1972–1973
crop year, the Soviet Union bought 30 million metric tons of grain, which amounted
to three-quarters of all commercially traded grain in the world (18, p. 227). The scale
of that transaction created a sudden, unprecedented shortage and skyrocketing
prices. Even though surpluses returned in a few years because the agricultural com-
modity programs which generated them remained in place, the tensions did not

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appear, but were intensified by farm debt and state debt, international competition,
and the changing balance of power among states.
The sudden scarcity of grains and soybeans precipitated by the Soviet pur-
chases provoked a counterproductive response by the United States. First of all, 333
despite 40 years of experience, the U.S. Department of Agriculture acted as if the
chronic surplus problem engendered by commodity price supports had disap-
peared. With state encouragement, U.S. farmers abandoned conservation and other
practices which had reduced acreage erratically since the New Deal. They followed
the advice of the Secretary of Agriculture to plant “fence-row to fence-row” to sup-
ply foreign demand for wheat, maize, and soybeans. Although the U.S. farm bill of
1973 finally introduced deficiency payments, target prices, and other measures
rejected in 1948 as an alternative to simple commodity price supports, the govern-
ment also raised subsidies (18, pp. 75–77). Hastily treating surpluses as a bad mem-
ory, farmers borrowed to finance expansion. In the United States, farm debt more
than tripled in the 1970s, fueled by high prices and speculation in farmland (3, pp.
21–22).
Second, the Nixon Administration, already beset by the Watergate scandals and
nervous at the prospect of domestic feed shortages, introduced a series of embar-
goes between 1973 and 1975, which prevented internationally cooperative adjust-
ment to the new conditions. The grain deal of 1972 was the economic centerpiece of
its major foreign policy initiative, Détente with the Soviet Union. This focus led to
the shift of agricultural trade policy from the Department of Agriculture (as an
Copyright © 2002. Taylor & Francis Group. All rights reserved.

adjunct to the farm program) to the State Department, where it served U.S. foreign
policy as “a lever that . . . has brought back into the world economy some 1.1 billion
people” of the Soviet Union and People’s Republic of China (Earl Butz, quoted in 18,
p. 157). The U.S. government gave the Soviets 75 percent of allocated Commodity
Credit Corporation export credits, plus additional subsidies which reduced the
export price below the domestic price. When the details became public, another
scandal resulted in Congressional inquiries into the “great Soviet grain robbery”
(18, p. 75). When soybean prices began to climb the following year, consumers and
livestock farmers mobilized, and the United States embargoed all exports in July
1973. Then in 1974 and 1975, fearful of a repeat of the scandals of 1972, the United
States embargoed grain to the Soviet Union (18, pp. 146–160).
The embargoes were complete failures. They revealed that the U.S. government
could not control trade even when, as for soybeans, the United States had a virtual
monopoly over supply. State trading agencies and transnational corporations and
their subsidiaries were able to use complex transactions and transshipments to
organize trade outside the knowledge, much less the control, of the U.S. government

or indeed of any state. Within two months of declaring the second embargo, the
United States negotiated the first of a series of five-year contracts with the Soviet
Union (18, pp. 159–160). This represented the largest single transaction in the world
food economy.
This rapid U.S. shift in 1975 implicitly acknowledged the frailty of U.S. food sur-
pluses as a weapon. The United States reversed course by shifting the focus to eco-
nomic policy intended to increase export earnings. By 1980 exports of grains and
feeds had increased eight times over the 1970 level. The dependence of the United
States on agricultural exports was compounded by the fact that a quarter of its
maize and about 15 percent of its wheat was bought by the USSR (14, p. 173).
Nonetheless, the Carter administration imposed one last embargo in 1980
(despite its electoral pledge never to do so) in response to the Soviet invasion of

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Afghanistan. The Soviets bought almost the whole amount of the cancelled con-
tracts on the world market, mostly from Argentina, Canada, and possibly even the
United States via transshipments from Eastern Europe. Moreover, the Soviet Union
334 had hard currency from its oil exports with which to buy grain and oilseeds.
Consequently, the U.S. embargo gave windfall prices to producers in competing
export countries, and windfall profits to the corporate traders which took advan-
tage of the unusual price fluctuations (18, pp. 165–169). The disastrous embargo
was one of the woes leading to the defeat of the Carter administration in the next
election. Thus, even though the Soviet Union and Eastern Europe together
accounted for imports valued at only a third of those of the third world, the United
States became dependent on Soviet purchases (24).
Yet within less than a decade the Soviet market, having risen to second largest
in the world, effectively collapsed. Over the course of the 1980s, Soviet imports
began to be sustained by the same U.S. mercantile trade practices which had been
applied earlier to Europe, Japan, and the third world. A high level of guarantees and
bonuses, that is, subsidies, maintained Soviet purchases from the United States in
1990 and 1991. As late as December 12, 1991, President Bush offered the USSR $1 bil-
lion dollars in credit guarantees for feedstuffs. Between 1987 and 1991, the United
States gave over $708 million in bonuses for Soviet wheat purchases. By then, sub-
sidized sales by the United States to the Soviet Union were such a large proportion
of world trade that each transaction further depressed prices. Indeed, the United
States even revived a credit guarantee program via the Export-Import Bank which
Copyright © 2002. Taylor & Francis Group. All rights reserved.

had been defunct for 16 years in order to offer an additional $300 million in guaran-
tees to the Soviet Union (25). The former Soviet Union is on the list of 28 countries
to receive subsidized exports announced by President Bush in September 1992 in
his campaign for reelection in farm states. Short of getting the EC to agree to loss of
major foreign and domestic markets, U.S. policy now depends on increasing subsi-
dized exports to cash-strapped countries whose prospects of repayment are dim.
Wheat, corn and soybean stocks in the United States rose again in the 1980s,
although new policies and expectations kept them in private hands (3, p. 23). When
the surpluses returned, they were harder to dispose of than before the boom. The
United States had expanded its production and world market share instead of
reforming agricultural policy (14). U.S. farmers carried a debt load which could not
be supported when falling prices reduced cash flow and deflated land values, and in
the 1980s farm failures became as severe as in the 1930s. Farmers had meanwhile
lost many of their urban allies and their unity across commodity groups, making
room for agro-food corporations to exercise the most effective lobby (18, p. 5).

When the bubble burst in the 1980s, U.S. farmers had lost their monopoly over agri-
cultural exports, and their political weight in U.S. trade policy.

Japan and the Asian Tigers

Just at the time when the United States was becoming dependent on grain and soy-
bean exports, its economic weight was declining relative to the EC and Japan, which
were the major markets protected against its products. While the United States and
Europe were sliding into a subsidy war, relations between Japan and major
exporters began to evolve in distinct ways. With the manifest collapse of the social-
ist bloc market after 1991, those relations revived the older, prewar competition
centered on import demand. These economic relations are deeply subversive of the

W
defining principle of the food regime, namely power based on state supported
exports of surplus commodities.
Japan’s national agro-food economy began with Marshall aid. The Allied
Occupation carried out a land reform and created a large class of small farmers 335
whose interests lay in maintaining high subsidies for rice. Japan’s postwar agro-food
reconstruction replicated the U.S. model, adapted to the circumstances of rice pro-
duction. Rice producers became politically important to successive governments,
and the security afforded by domestic rice supplies became a tenet of national ideol-
ogy. Subsequent U.S. strategic aid to South Korea and Taiwan had similar effects (26).
Yet replication was not balanced by integration as in Europe. Despite the similar
goals and policies of Marshall aid, the economic and political conditions after the
war, plus a lack of historical connections, led U.S. corporations to shy away from
significant direct investments in Japan of the sort they were undertaking in Europe
(27). Thus compared to Europe, U.S. transnational firms did not create production
chains integrating Japan’s agro-food sector with that of the United States.
In addition to postwar strategic conditions, the distinctively national character
of the Japanese agro-food sector stemmed in part from its distinct diet. Although
Japan early became a major importer of grains and soy, they played different roles
in consumption and therefore in production. Wheat reflected a dietary change,
encouraged by numerous trade missions and specific aid projects, such as provi-
sion of school meals. Japan became the largest of the new wheat importers after
World War II, the rest being countries of the emerging third world. By incorporating
Copyright © 2002. Taylor & Francis Group. All rights reserved.

wheat into their diets. Japanese consumers benefited from low world prices and
helped clear U.S. surpluses from the market. In this sense, Japan played the same
role as third world countries in restructuring international wheat trade around the
United States as an export center.
Japan’s relation to international soy markets was also different from that of
Europe. Since soy was initially used mainly for human diets, it did not enter the eco-
nomic and technical chains of the feedstuffs industry. The manufacture of soybeans
into tofu, miso, and other foods was a distinct, Japanese production. Most impor-
tant, as human food, soy cannot be substituted in the way that animal feeds can
be—and eventually were. By the time Japan began to import significant quantities of
soy for animal feeds, the food regime was already changing.
Dependence on U.S. imports was reliable during the stable period of the food
regime, when U.S. surpluses led to cheap world supplies. However, the U.S. soy
embargo of 1973 changed Japanese perceptions radically and permanently.
Although the embargo lasted only two months and all contracts were eventually

honored, its effect on the confidence of import states was enduring (14, p. 145). In
particular, the embargo fatefully impressed the government of Japan with the unre-
liability of the United States as a source of virtually all its soy. By 1980, as we shall
see, the U.S. share of world soya markets plummeted from its virtual monopoly a
decade earlier. U.S. trade negotiations with Japan in the subsequent two decades
have included repeated but fruitless apologies for that political blunder almost 20
years ago (28). This may be the reason the U.S. pressure on Japan to reduce agricul-
tural trade barriers in the early 1980s concentrated on beef and citrus products,
rather than rice (29).
Japan’s investment and trade became a major force in the transformation.
Japanese agro-food investments abroad began after the food crisis. If we under-
stand soy and grains to be resources necessary for the domestic economy, then

W
they may fall under the larger resource strategy described for minerals by Bunker
and O’Hearn (30). According to their account, Japan and the United States have con-
sistently adopted completely different foreign economic strategies, based on their
336 distinct endowments of natural resources. They argue that without significant
domestic production, the Japanese interest is in diversity of supply, which keeps
prices down and reduces strategic dependence on any supplier. Japan can best
achieve this goal by using the minimum investment necessary to create as many
export sectors as possible. Exporters then compete for the Japanese import mar-
ket, and Japanese importers can pick and choose, and shift from one supplier to
another. This contrasts sharply with the longstanding U.S. (and European) pattern
of direct foreign investment. Both domestic production by U.S. corporations and
foreign production by their subsidiaries are locked into production sites and tech-
nologies matched to those sites (30).
Unlike the United States, and even the European Community, Japan is destined
to import soy. The component of soy imports used in human diets is not substi-
tutable. With the crucial exception of rice, imports of many agricultural products,
and especially soy, are as important to Japan as minerals. In addition to the
central tenet of agricultural policy, which continues to be national
sufficiency in rice, Japan’s interest as an importer lies unambigu-
ously in secure access to necessary imports of grain and soy.
Although Japan is a distant second to the European
Community in the volume of its soy and feedgrain imports,
Copyright © 2002. Taylor & Francis Group. All rights reserved.

its singular foreign economic strategy has the potential

completely to undermine the structure of international
food relations. Japan began in the early seventies to look
for sources of soy supply other than the United States. Its
strategy was to change the nature of surpluses from a prob-
lem of disposal, which the United States and EC confronted, to
an advantage for the buyer. It found a complementary interest
among countries of the third world whose national industrial policies
created internationally competitive agro-food sectors in the 1960s and after.

New Agricultural Countries

Behind the scenes of the Atlantic conflict which held center stage at the GATT is a
new alignment. Trade between Japan (and other commercial importers) and suc-
cessful new agro-food exporters in the third world continues to destabilize the

Atlantic-centered food regime. The new relations began during the early crisis years
of the 1970s.
Soviet-American trade brought skyrocketing prices and new export markets in
the seventies. These conditions coincided with the new possibilities for public bor-
rowing created by the oil crisis (31). OPEC states captured a large share of world
revenues and deposited them in international banks. The banks in turn pressed
these “petrodollars” on borrowers. Many of the borrowers were third world and
socialist states, including some which hoped to invest in export agriculture and to
use the earnings to repay the loans. Another set of borrowers, on a scale equivalent
to third world debt, was U.S. farmers. Seventies lending of petrodollars fueled both
buyers and sellers of an expanding world market.
The differentiation of the third world into oil exporters, successful exporters of

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manufactured products, and those left behind in poverty (sometimes called the
“fourth world”) began in the early seventies. The new industrial countries, called
NICs, were part of a transnational restructuring of industrial production. As we have
seen, the technical basis of the U.S. model of agriculture, which was replicated and 337
integrated in different ways in other parts of the world, comprised the subordination
of crops and livestock into corporate, often transnational, agro-food complexes and
the industrialization of agriculture itself. The successful development of export agri-
culture was as important as that of manufactures, and created a comparable set of
“new agricultural countries,” or NACs. Some, such as Brazil, are both NICs and NACs.
Brazil is the most important NAC. Its export capacity was based on a particu-
larly successful development of the industrial agro-food economy in the 1960s, by
means of state guided policies of industrialization through import substitution.
Starting in the 1960s, the Brazilian state used a strategic mix of agricultural settle-
ment, credit, and taxation policies to create an intensive livestock sector based on
nationally produced grain and soya. Not only that, but export taxes on unprocessed
soya encouraged national processing, whether by state or private, national or
transnational, corporations.
Brazil replicated and modernized the U.S. model of state organized agro-food
production. It shifted the focus of domestic policy from agricultural subsidies to
agro-industry, which increased the value of commodities and did not create sur-
pluses. Brazilian export policy replaced the U.S. focus on stabilization of domestic
farm programs, with an emphasis on high value-added exports (32).
Copyright © 2002. Taylor & Francis Group. All rights reserved.

Within four years of the U.S. soy embargo of 1973, NACs had cut into the previ-
ous virtual U.S. export monopoly. By 1977, the U.S. share of world exports of
oilseeds and meals, of which soy was the largest, was only 54.6 percent (14, p. 193).
Ten years later, the U.S. share of world oilmeal exports had fallen to one-sixth. It
exported less than Brazil and only slightly more than Argentina. China, Chile, and
India had joined the ranks of major oilmeal exporters (21, p. 52).
Ironically, the United States retained a nearly two-thirds share of unprocessed
oilseed exports, while Brazil exported high value-added meal. When Japan, the
Soviet Union, and other import countries looked for alternatives to U.S. supplies,
Brazil was especially well poised to concentrate on value-added meal rather than
unprocessed soybeans. By 1980 Brazilian soybean production was a third as large
as that of the United States, and its soymeal production half as large; Brazilian
exports of soybeans were 10 percent of U.S. exports, but its soymeal exports were
virtually equal. Then within a few years, as we saw, Brazilian soymeal exports
exceeded those of the United States (10, p. 16; 21, p. 52).

Thus, Brazil’s successful adaptation of the U.S. model, which shifted the focus
from agriculture to agro-industry and from the management of surpluses to com-
mercial exports, involved a complex web of international and social transforma-
tions. It gave Brazil a competitive advantage in a technically evolving and increas-
ingly open international food economy—at a high cost to the victims of capitalist
transformation of the agro-food economy of Brazil (33). Most important for interna-
tional food relations, the NAC phenomenon revived the intense export competition
on world markets that existed prior to the postwar food regime, and shifted advan-
tage from exporters to importers.
This fit neatly with Japanese strategies to diversify world supplies with minimal
investments and commitments abroad. Like many other states caught in the debt
trap, as Bunker and O’Hearn (30) point out, public investments and joint ventures in

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third world export sectors allowed Japanese capital to gain leverage with minimal
direct investment. This link between third world states and (often Japanese) foreign
capital supplanted the earlier combination of direct (U.S. and European) foreign
338 investment and state investment and controls favoring import substitution.
Liberalization has created an unstable situation in which importers (with
strong currencies) benefit and the larger exporter wields the greatest power in
international rule-making. Paradoxically, liberal trade practices now so desperately
pursued by the United States to manage short-term deficits reinforce the long-term
shift of advantage to (economically strong) import countries. With success at the
GATT the United States could find itself in a new game, in which the rules convert
export surpluses from a source of power into a source of dependency.

W T H E E N D O F T H E S U R P LU S R E G I M E

The impasse over agricultural subsidies at the GATT reflected the contradictory
foundations of the postwar food regime, foundations which are crumbling rapidly.
Overt conflict between replication and integration of national agro-food sectors at
the end of 1992 was reduced to a few million tons of oilseeds. That it was important
enough to jeopardize the comprehensive multilateral agreement to extend corpo-
rate power in key areas for future accumulation, such as services and intellectual
property rights, testifies to the strength of residual tendencies in the food regime.
Copyright © 2002. Taylor & Francis Group. All rights reserved.

Even the 1993 agreements to reduce European Community subsidies and end mer-
cantile trade rules do not assure the future envisioned in the larger GATT agree-
ments. The contest will continue between political projects envisioning different
futures.

The End of Commodity Programs?

Farm policies were catching up with the collapse of the postwar food regime even
before the GATT agreement. Changes in agricultural policy unimaginable at the out-
set of the Uruguay Round anticipated an end to national surpluses.
The separation of farm income supports from production—that is, the end of
price supports—is the likely future for North America and Europe. This would undo
the key feature replicated in the food regime—government generated surpluses. In
the United States, although farm lobbies gained provisions requiring reinstatement
of old measures if the Uruguay Round were to break down, the farm bill of 1985
accelerated the shift from price to income supports—even as it intensified export
subsidies. After 1987, fiscal pressures reduced the level of price supports. Most of

the U.S. states which are the stronghold of the farm lobby voted Republican in the
November 1992 elections, and the Democratic incumbent may feel less beholden to
them than the past decade’s ruling Republicans. In the EC, reforms of the Common
Agricultural Policy initiated in 1988 and intensified in 1991 point more decisively in
the same direction. Payments to farmers will support their incomes directly, instead
of indirectly through the prices of their commodities. While farmers will no doubt
continue to be forced off the land, at least some will be supported as a combined
rural welfare and tourism project. Farm income supports may also be tied to man-
agement of rural resources and to environmental programs.
The shift to income supports promises eventually to end the mountains and
lakes of surplus agricultural commodities disposed of abroad by government subsi-
dies and credits. It is easy to ignore the remarkable consensus on this way of ending

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an epoch of agricultural policy because (at least to proponents of urgent liberaliza-
tion) implementation seems glacial (34). Yet the shift is likely to continue, because it
confirms in policy what has already occurred structurally. Whatever stocks may be
intentionally created for stabilization or security, whatever export subsidies and 339
import controls may be retained or introduced, will have—indeed already do
have—effect on the global agro-food sector different from those which shaped the
food regime.

The Food Regime Unhinged

The two trade hinges of the food regime are coming unstuck. Countries of the third
world and more recently of the former socialist bloc joined the multilateral trade
negotiations at the GATT (35). This reflected (and reinforced) the unhinging of
Atlantic agro-food integration, and of the U.S.–third world grain trade.
The Atlantic hinge is weakening as Western Europe and the United States are
reorienting trade toward their respective continents. The North American Free
Trade Agreement of 1992 and the potential expansion of the European Community
to Nordic, former socialist, and other countries promise to extend “decoupling” to
the continents of North America and Europe. This has been envisioned by corpo-
rate policy advocates for some time. As early as 1987, the President of Cargill Ltd.
told the Financial Post (January 26), the leading Canadian financial journal, “Major
agricultural producing countries should concentrate on devising actuarially sound
Copyright © 2002. Taylor & Francis Group. All rights reserved.

income insurance policies . . . but we must avoid like the plague commodity-specific
programs that encourage overproduction or distort land use decisions” (quoted in
36, p. 112). Continental integration is also emerging in Asia, centered on Japanese
imports and investment (37, 38). Whether these turn out to be rivals or partners,
they replace the U.S. center of the food regime with multiple centers.
The Atlantic hinge held because of the Cold War divide of Europe. The collapse
of the socialist bloc was crucial in breaking the impasse over West European farm
policy, by separating reform of the Common Agricultural Policy from the conflict
with the United States. Prospective incorporation of Eastern Europe (and new
Nordic and Alpine members), according to Tim Josling (1, pp. 18–19), was the most
compelling reason for the MacSharry reform proposals. The former socialist coun-
tries include large fertile regions, which are politically divided, economically under-
developed, and culturally distinct. Much like the U.S. South in the fifties and sixties,
where soy rapidly replaced cotton, it opens a rich hinterland with abundant land
and labor for reconstructing original agro-food relations. If stability returns to the
former Soviet Union, the indiscriminately maligned state and collective farms may
provide ripe pickings for agro-food transnationals (not only European-based, of

course), particularly in the livestock sector. Similar openings could include China in
Japanese diversification of investment and trade.
The other hinge was between the United States on one side and the third world
(and Japan) on the other. The decline of U.S. economic power parallels the transfor-
mation of exports from a source of power into a source of dependence. U.S. exports
were a source of economic and strategic power. In many underdeveloped countries,
the food regime left a legacy of food import dependence, stagnating export rev-
enues, and debt. Later, a few became New Agricultural Countries, whose competi-
tive exports helped to disrupt the food regime. Now, in the twilight of the regime,
the export imperative prevails. For strong importing economies, such as Japan, this
is an advantage. For the third world as a whole, the transformation of their
economies into agricultural export platforms intensifies new global international

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hierarchies between North and South (39).
The export imperative completely undermines U.S. centrality in the food
regime. The “inevitable trend toward export dependence” (18, p. 77), which was
340 built into U.S. farm and export-and-aid programs, has come to fruition. For a decade,
Republican governments in the United States have sacrificed long-term restructur-
ing to aggressive export practices. The U.S. zeal to force open commercial markets
implicitly recognized the failure of concessional sales, long-term credits and other
forms of “aid” to create new markets. Surpluses have come to signify weakness
rather than power, a burden rather than an opportunity. The need for markets and
the need to restructure domestic agriculture have led to contradictory foreign eco-
nomic policy—aggressive trade practices combined (since 1987) with insistent
demands to abolish such practices.
The accession of former third world countries into the GATT and their sudden
conversion to free trade signals the subordination of food restructuring to interna-
tional debt (39). Promotion of agricultural exports, especially those called “nontra-
ditional” (geared to new niche markets for exotic foods, flowers, and other crops), is
an explicit aim of structural adjustment conditions imposed by creditors. They usu-
ally intensify social inequalities and conflicts in poor countries. For instance, Brazil,
which is a stunning success as measured by investment in agro-food production and
exports, is also a nightmare of evictions from the land, displacement of local food
systems, hunger, and social unrest (40). As I write, major social unrest has precipi-
tated massive food distribution to the poor. It is certainly less orderly and less inte-
Copyright © 2002. Taylor & Francis Group. All rights reserved.

grated with public policy than were the food subsidies abolished in the past decade
of austerity. These are part of a string of “IMF riots,” frequently over food prices,
during the past decade of austerity (41). They reflect the suffering imposed in new
centers of accumulation like Brazil, no less than in the vast regions pushed to the
margins of accumulation, which include much of the African continent.
Debtor countries are caught in a scissor between the export imperative and
import restrictions in Northern markets. They are thus forced to support free trade,
however wrenching is the shift from decades of import substitution, controlled
flows of goods and money, and state enterprises. Debt repayment, currency reform,
and the rest require access to highly protected food markets in North America,
Europe, and Japan. Liberal capitalism is the new, externally imposed form of auster-
ity in the late 20th century. It is opposite to the austerity chosen by revolutionary
third world states of the Cold War era, which took the form of autarkic socialism.
Collectivization regardless of national circumstances was often futile and even dis-
astrous. The same can be said of the creation of agro-food export platforms regard-
less of national circumstances.

Yet the export imperative, despite the faith in comparative advantage prevailing
in expert circles outside Europe, does not create new regime rules. “Decoupling”
and “tariffication” are the words used to dismantle farm policies and trade policies
which once worked in tandem to regulate the food regime during years—now a dis-
tant memory—when it was stable. But if farm incomes are supported for reasons
other than agricultural production—social insurance, keeping a lid on unemploy-
ment, environmental protection, promotion of tourism—then what will become of
agriculture? Direct payments to farmers can address rural poverty and outmigra-
tion, can support rural tourist industries, and perhaps mollify farm organizations,
but they intentionally do not regulate agriculture. Likewise, to increase the “trans-
parency” of trade controls by converting them all to tariffs does not regulate agro-
food power or property.

W W H AT N E X T ?

Emergent tendencies have unfolded quickly since the Uruguay Round began in 1986.
These prefigure alternative rules and relations. One is the project of corporate free-
dom contained in the new GATT rules. The other is less formed: a potential project
or projects emerging from the politics of environment, diet, livelihood, and democ-
ratic control over economic life. Farmers (who are heterogeneous) must somehow
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341

ally themselves in the main contest over future regulation: will it be mainly private
and corporate, or public and democratic? What international rules would promote
each alternative? The answers depend on the ways that emerging agro-food policies
are linked either to accumulation imperatives or to demand raised by popular social
movements.

Private Global Regulation?

At present, agro-food corporations are the major agents attempting to regulate agro-
food conditions, that is, to organize stable conditions of production and consump-
tion which allow them to plan investment, sourcing of agricultural raw materials,
and marketing. The new rules defined by the December 1993 GATT agree-
ment significantly empower transnational capital. This empowerment concerns not
Copyright © 2002. Taylor & Francis Group. All rights reserved.

only the freedom to trade and invest in agriculture (cattle and potatoes), indus-
try (frozen hamburgers and chips) and services (hot hamburgers and chips).
Provisions for intellectual property rights also have serious implications for
uses of biotechnologies, for control over genetic resources (42), and for
standards protecting craft and regional foods (43).
However, transnational agro-food corporations have now outgrown the
regime that spawned them. In particular, even U.S.-based corporations have
long had interests of their own, not related to those of the U.S. state or national
economy, and certainly not to those of U.S. farmers. A major reason why U.S. embar-
goes never worked, for instance, was corporate collusion with import countries to
evade U.S. trade restrictions (18). Even before the food crisis, subsidiaries of U.S.
corporations were working independently of U.S. national policy. For
instance, in 1970, subsidiaries of Cargill and Continental, assisted by a trade
agency of the French government, joined with other major grain companies in a
cartel, Francereales, to promote French exports. The cartel was dissolved in 1973,
under pressure from public authorities and from excluded competitors, but was

revived in 1975 to respond to the new Soviet market (18, pp. 61–63). Because the
U.S. state could not control or even monitor shipments by transnational corpora-
tions, U.S. policies to increase U.S. food exports at the same time undercut U.S. polit-
ical power.
Within the limits of international rules, corporate integration of a global agro-
food sector has proceeded as quickly and thoroughly as changing technologies per-
mit. A new degree of global sourcing is made possible by feedstuffs that substitute
for the standard corn and soy combination of the food regime (44). Three examples
may suggest how “substitute feeds” at once integrate agro-food complexes and ren-
der substitutable the exports (and farmers) of any nation. First, orange pulp, a
byproduct of the frozen orange juice industry, integrates the livestock and durable
foods complexes. This adds complexity to the competition between Brazil and the

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United States, which becomes (among others) an interplay between now-traditional
feeds (soy) and durable foods (frozen juice). Second, tapioca, mainly exported from
Thailand, directly seizes upon a traditional human dietary staple and converts it
342 into a commercial export feed crop. The expansion of tapioca in Thailand per-
versely detracts from rather than enhances human diets—but then so does the
export of fishery products for human consumption abroad. Third, the most com-
plex relations surround corn gluten as a substitute feed. This produce, which is
highly protected by the European Community, is the byproduct of manufacture of
high fructose corn syrup. The latter is the main sugar substitute in food manufac-
ture. Without export revenues from gluten feed, the use of corn as a sweetener is
too costly, and the domestic U.S. demand for corn will fall considerably. Not sur-
prisingly, this was one of the European import duties most intensely contested by
the United States (45).
Meanwhile, as the rules have shifted, so have the commodities central to accu-
mulation. While feedstuffs, the heart of the food regime, are becoming globalized
rather than merely internationalized, the completely new markets in “exotic” fruits
and vegetables are global from the outset. Any state can enter, and in the push and
shove of new markets, there is room for fly-by-night entrepreneurs and instant
transnational corporations, as well as the giants of the postwar agro-food regime
(46, 47). Rapacious entrepreneurial practices are encouraged by slavish state poli-
cies to attract investments and promote exports. The paradise of eternal strawber-
ries and ornamental plants for rich consumers depends on an underworld of social
Copyright © 2002. Taylor & Francis Group. All rights reserved.

disruption and ecological irresponsibility. While no rules have yet stabilized “non-
traditional” export markets, the main corporate agenda points to global sourcing
and marketing, that is, the impulse to diversify suppliers and cultivate tastes for
“exotic” foods (pears in Mexico no less than starfruit in Canada). Superimposed on
the diversification of raw materials for mass-produced durable foods in this post-
Fordist nightmare of “flexible specialization” and “niche markets.”

Democratic Public Regulation?

Stable rules cannot come from private and competitive organizations, despite the
global reach of some corporations. There are two reasons for this. First, the very
conditions which allowed for agro-food capitals to become pivots of accumulation
have created new social actors and new social problems. Second, agro-food corpo-
rations are actually heterogeneous in their interests.
Classes of producers and consumers have changed radically from the time
when transnational agro-food corporations were born. The agro-food sector is now
focused on food—industry and services—rather than on agriculture. The character

of classes, urban and rural, involved in food production has shifted. In meat-pack-
ing, for instance, the scale of production has increased dramatically. This has been
accompanied by massive restructuring of the labor process and a standardization
of products. The main result in the United States over the past two decades has
been to replace a native born, male workforce—both disassembly line workers in
packing plants and skilled butchers in supermarkets—with new immigrants, often
female, recruited in new plants in small cities in the U.S. plains (48, 49).
Restructuring is occurring as well in Australia, mainly for export to the Pacific rim,
at massive environmental cost (38). Both cases echo in the old centers of accumu-
lation a process that began in NACs, such as Mexico, to create the “world steer” at
the expense of the traditional markets for peasant sideline production of cattle (50).
As farmers have declined in numbers and unity, and workers have lost some of

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their bargaining power with agro-food corporations, food politics have shifted to
urban issues, that is, to food rather than agriculture. Consumers in the food regime
have been constructed by agro-food corporations to desire first standard foods, and
then exotic foods from the entire globe. Yet contradictions have emerged in the 343
sphere of consumption. Poverty limits access to food and demand for the products
of the agro-food economy. In the poorest parts of the world, and the poorest popu-
lations of rich countries, many are forced to withdraw from commodity relations
into self-provisioning and informal networks. More privileged consumers have
come to appreciate the dangers to health and the environment from the dominant
practices of agro-food production created by the food regime—mainly the chemical
intensive monocultures of farming and the chemical intensive production of
durable foods. The most privileged consumers have revived demand for hand-
crafted goods, including meals, now expressed in the language of “designer” foods.
A food policy is more adequate to present conditions than the farm policies left
behind by the waning food regime. It is made possible by the decoupling of farm
incomes from agricultural production. The national agricultural policies of the food
regime not only support prices and generate surpluses. Through credit and insur-
ance criteria, for instance, they also foster large farms, monocultural practices, and
the environmentally destructive use of chemicals and heavy machinery. They also
encourage technological and social dependence of farmers on corporate suppliers
of packages of chemical inputs and purchasers of contractually (or simply monop-
oly) specified crops and animals. As national farm policies come under increasing
Copyright © 2002. Taylor & Francis Group. All rights reserved.

pressure, the possibility arises to create a positive food policy.

The social basis for a democratic food policy lies in movements for employment
and incomes, for safe and nutritious food, for environmentally sensitive agriculture
(including treatment of animals) and for democratic participation. The main social
movements concerned with aspects of food focus on poverty, hunger, employment,
health, cultural integrity, the environment, rural recreation, and even animal rights.
Within this field of issues, agricultural regulation can become part of a comprehen-
sive plan to use the capacities of people and the land to meet the needs of commu-
nities for nourishment, cultural expression, and a congenial habitat.
A democratic food policy is quite a different prospect from the implicit policy
posited by liberalization of trade and empowerment of transnational corporations.
The latter embodies the principles of distance and durability, the subordination of
particularities of time and place to accumulation. It moves beyond the global pro-
motion of American diets, such as hamburgers and cola drinks, to the creation of a
global diet consisting of an array of manufactured meals and ingredients, called
Chinese, Mexican, Middle Eastern, or whatever, in the freezers of supermarkets
throughout the world.

Democratic principles, by contrast, emphasize proximity and seasonality—sen-

sitivity to place and time. This means the use and development of technologies and
markets to facilitate local enterprises in every possible link of agro-food chains.
What is increasingly clear is that healthy food and environmentally sound agricul-
ture must be rooted in local economies. These must respond to the capacities and
limits of bioregions, including the needs and capacities of the people who dwell
there. In other words, food to nourish people and communities can only be linked to
agriculture in harmony with nature, by means of chains of commerce and transfor-
mation located as much as possible within regions. A democratic food policy can
reconstruct the diversity destroyed by the monocultural regions and transnational
integration of the food regime. It is also about employment, land use, and cultural
expression.

W
Of course, community Davids cannot contest the power of corporate Goliaths
unless they find allies. To act locally entails acting at all levels, up to and including
the world economy. National states can protect and link regional projects if pressed
344 to do so. Indeed, some of the most progressive technical possibilities, such as the
substitution of fossil fuels by ethanol, depend entirely on the present structure of
subsidies and protection. Even if that specific structure cannot be saved, important
fractions of capital are engaged in long-term projects, such as Archer-Daniel
Midlands in the United States and Ferruzzi in Europe, whose interests, at least in
part, lie in public regulation of agro-food economies (45). They are potential allies of
popular movements for regional food economies.
This possibility could only be pursued through institutions at all levels, from
the municipal to the international. In various parts of the world, municipal and
regional governments—or popular organizations—are experimenting with ways to
support regional agro-food networks. These include community kitchens and links
to farms, support for scientific research geared to local industries, and publicly sup-
ported community catering in schools and other public institutions.1 With the
exception of Sweden a few years ago, however, no national state has undertaken to
create a food policy as a framework for reshaping agriculture to meet environmental
and social needs (52). To the contrary, perhaps the most comprehensive national
food system in the capitalist world is in an advanced stage of dismemberment in
Mexico. A public corporation, whose activities extended beyond regulation of agri-
cultural prices into basic processing, distribution, and provision of affordable food
Copyright © 2002. Taylor & Francis Group. All rights reserved.

to low income consumers, effectively “decoupled” rights to the land and rights to
food from market dictates (53). Against popular resistance whose scale and inten-
sity may not yet be evident, a decade ago new political elites began to dismantle the
Mexican system under pressure of negotiated austerity measures and anticipated
continental free trade.
Even with national support, the success of regional agro-food systems depends
on international institutions. The World Food Board proposal of 1947, which
expressed the hopes of a wartorn and hungry world for international cooperation to
plan food and agriculture, belongs to the past (2). But it is important to remember
that alternatives did exist and choices were made. Despite the multiplication of the
number of states since 1947, when many were part of European colonial empires or
of the emerging Soviet bloc, virtually all countries have agreed to multilateral eco-
nomic negotiations. Most are doing so at the very time when national states are
being restructured in response to transnational capital (54, 55). The consequences
are dangerous for livelihoods and democracy. A better outcome depends on
whether, despite their variety and inequality, movements for livelihood and democ-

racy can shape the contest over new international rules, both within and outside
the proposed World Trade Organization.

AC K NOW L E D G M E N T S

I would like to thank Henry Bernstein, Barbara Harriss-White, Geoffrey Kay, Jean Laux, Philip McMichael, and
Mary Summers for critical advice and encouragement in revising earlier drafts, and Yildiz Atasoy for invaluable
research assistance.

NOTES

This article is modified from “The Political Economy of Food: A Global Crisis,” published in New Left Review, No.

W
197, January/February 1993, pp. 29–57, also published as “The International Relations of Food,” in Food, edited by
Barbara Harriss-White and Sir Raymond Hoffenberg, Blackwell, Oxford, 1994. Earlier versions of this essay were
presented at Wolfson College, Oxford, the Agrarian Studies Program, Yale University, and the Department of
Political Sciences, University of Toronto. 345
1. I have in mind examples from northern Italy, Mexico City, and Toronto. For a discussion of the
London Food Commission, created by the Greater London Council, see reference 51.

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Food in The USA A Reader - (25 The International Political Economy of Food A Global Crisis)

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W

W THE FOOD REGIME: PRINCIPLES AND CONTRADICTIONS

authorized both import controls and export subsidies necessary to manage

itself. Since major states continued to support agricultural prices by purchasing

The United States at the Center

animal feeds, and as sellers of raw materials to food manufacturing industries or

foods required standard agricultural raw materials, which corporations obtained

Europe and the Atlantic Pivot

trators, however, minimized agricultural dumping, as they understood it to be (5).

restrictions against wheat and dairy imports (the old products in

The Third World

Détente and the Linking of Blocs

Japan and the Asian Tigers

its singular foreign economic strategy has the potential

New Agricultural Countries

The End of Commodity Programs?

The Food Regime Unhinged

Private Global Regulation?

Democratic Public Regulation?

pressure, the possibility arises to create a positive food policy.

Democratic principles, by contrast, emphasize proximity and seasonality—sen-

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