U.S. GRAIN ARSENAL
NACLA
Introduction The United States' control over the world grain trade is greater than the dominance of the OPEC nations over oil. With three-fourths of the world's net grain exports coming from the...
...While the majority of Americans are forced to spend 30 percent of their income on food,**and at the same time are faced with rising unemployment, government officials recommend belt-tightening...
...The implications of this new policy for the U.S...
...Interview with former official of the Commodity Credit Corporation...
...The president is empowered to spend up to $1.9 billion in Title I and $600 million in Title II funds by simply borrowing from the Agriculture Department's Commodity Credit Corporation...
...Among the grain companies, Cargill was the major firm to take advantage of the latter program...
...13 Aside from PL 480, other government programs also stimulated company exports...
...Just after the First World War, Herbert Hoover used the U.S...
...It owns France's sixteenth largest bank, the Banque Louis Dreyfus et Cie., and controls the Banque Hypothdcaire Europ6enne, the fifth largest mortgage bank in Europe...
...At the same time Cargill used its control over railroads and elevating facilities to exploit the farmers...
...When it acquired C. Tennant & Sons, an international metals trading firm, Cargill gained a foothold in the Brazilian metals trade and picked up a chemical plant...
...In the early 1970s when the United States slowed down economic aid to the Peruvian Junta to pressure for compensation to nationalized U.S...
...It is a prop to support U.S...
...Since most of the companies' international transactions are in foreign currencies, they also maintain divisions that deal solely in foreign exchanges...
...To be effective, a campaign against the grain trade must form part of the movement that challenges the very existence of capitalism...
...Located in a French-style chateau outside of Minneapolis, the company's officials deal in billions of dollars worth of commodities in pastoral surroundings seemingly far removed from the modern corporate world...
...E 0 4) >Z ZT...
...manufactured goods that were used as inputs by the foreign subsidiaries...
...7 October 1975 Published monthly, except May-June and July-August when it is published bi-monthly, at 160 Claremont Ave., New York, NY 10027...
...foreign policy...
...To this day, family farms and medium-sized commercial units supply most of the world's grain...
...Continental Bank of Illinois, op...
...The company realizes that the new agricultural policies of the United States mean widely swinging markets with boom and bust periods in agriculture...
...For more on the role of food in Kissinger's policy of confrontation with the Third World, see Steve Talbot, "Food as a Political Weapon," in Weissman, op...
...San Francisco Examiner, October 5, 1975...
...Sections of the Department of Agriculture are virtually run THESE ARE SOME OF CARGILL'S ACTIVITIES WORLD MARKETING Food grains and feed grainswheat, corn, oats, barley, sorghum, rye, rice, alfalfa, etc...
...Interview with Cargill official...
...But at the same time Cargill is diversifying so that it is well protected during the lean years...
...food aid has been to discourage agricultural development in Third World countries and to create dependency on the United States...
...By focusing on the largest of these corporations, Cargill, we examine how these firms maximize their profits at the expense of farmers and urban working people alike...
...When Nixon traveled to Minneapolis in early 1964 to review his firm's accounts with Cargill, the company helped him arrange a conference at the Minneapolis Press Club...
...Before each year's crop is harvested, billions of dollars of grain are already sold to buyers...
...government is relying on the Soviet Union to provide a large and steady market for U.S...
...Cargill also had interlocking directorates with some of the railroads...
...upgrading diets . . . raising new demands for the American farmer's crops...
...strategies for solving the economic crisis has created new problems for U.S...
...Chief among them was Sen...
...This provision, however, had little effect in Indochina or other countries...
...In 1938, the Board, still controlled by well established local traders, filed suit against the upstart company, charging Cargill with manipulating prices on the corn market...
...Continental Grain Company, 2 Broadway, New York, N.Y...
...Washington would acquire virtual life and death power over the fate of multitudes of the needy...
...efforts, people who once relied on their indigenous foods now eat U.S.-grown wheat transformed into American-style steaks, hamburgers and Kentucky fried chicken, all raised on U.S...
...According to Business Week, the Ford Administration is planning to use its "agrimuscle" to gain "fair access to supplies that are scarce in this country, such as bauxite...
...7 World War II brought with it a new commercial framework for the operations of the grain companies...
...While the reserve system would provide food security for cash customers, it would not solve the principal problem of Third World countries and poor people within those countries, which is lack of purchasing power...
...egg business 1966 Holland Soybean plant Pre-1969 El Salvador Feed plant 1969 South Korea Integrated feed, poultry, and egg operation 1970 France Soybean plant Joint venture with European firms...
...When this year's PL 480 spending estimates were presented to Congress last spring, the Administration deliberately made no requests for the Middle East, pending a "review" of Middle East policy...
...The company operated mainly in the European market until the rise of Hitler forced the family to flee to the United States with its business...
...competitive in world trade...
...Both the small country elevator owners and the farmer cooperatives complained bitterly that the companies were able to take advantage of subsequent price rises at their expense.Is And, of course, the CCC also lost a sizable amount of potential revenue since it could have waited for corn prices to rise before selling the surpluses...
...With U.S...
...list-a suggestion that was rejected by the U.N...
...At the beginning of fiscal year 1974, Cambodia and South Vietnam were slated to receive $207 million in food aid...
...acreage from production, eliminated price supports so that prices are determined by market forces, and effectively ended the CCC's reserve program...
...The amount of commodities shipped under the program dropped in 1973 to an all time low of 3.3 million tons, one fifth the level of the mid-1960s...
...and, it is hoped, the Soviet Union will be forced to cooperate in the reserve system in order to assure itself continuing access to U.S...
...As one person close to Cargill observed, "If a person has the power, Cargill finds the way to influence the person...
...Maritime hostilities ended direct private grain exports, and the government stepped in to regulate the domestic grain market as well as other sectors of the economy...
...Interview with official at General Accounting Office...
...Wherever there are cash customers, Agriculture Department officials are there along with grain industry representatives to create markets...
...To lay the groundwork for its response to the economic crisis, the Nixon Administration in May 1970 appointed a presidential Commission on International Trade and Investment Policy...
...The power of the tr...
...When Palmby left the U.S.D.A...
...The U.S...
...And later, under the Marshall Plan, enormous shipments of U.S...
...1 grain customer...
...For more on U.S...
...With three-fourths of the world's net grain exports coming from the United States, this country is, in effect, a one-nation grain cartel...
...Able to handle large * For a more extended discussion of CCC credits and the Barter Program, see Part I above...
...This approach, however, ignores the fact that the companies are modern enterprises that vividly illustrate the basic tendencies of capitalism...
...government for another favor: it asked for and received permission to defer payments on its two PL 480 loans...
...CARGILL AND THE STATE Although the company loudly proclaims the need for free trade and abhors government regulation, it would be virtually impossible for the world's largest grain trader to operate without the continued support of many State institutions and organizations...
...The Williams report recognized the costs of maintaining empire as a major factor in the U.S...
...in the agricultural sector 2 7 -a victory for those who complained agriculture's interests were "sold down the river" in the previous negotiations...
...684 583 France...
...officials to intervene on its behalf with the Korean government to try to obtain a relaxation of the import restrictions and the domestic price controls...
...exports between 1972 and 1974...
...commercial banks.' 8 Cargill draws on these credit lines to pay for its grain purchases...
...However, as a result of the market mechanism, this shortfall was transmitted into skyrocketing food prices in the industrialized countries and starvation in some regions of the Third World...
...dominance over the world's grain trade...
...Although they import less grain than Western Europe and Japan, the Third World countries are lucrative markets for the grain traders...
...corporations extended their reach into new areas of the economy...
...agricultural strategies are equally serious for other working people in the United States...
...power...
...strategists...
...838 328 Source: Foreign Agriculture, August 18, 1975, p. 1 1 United States is now demanding the removal of the Common Market's protective tariff system which effectively prevents U.S...
...Jack Anderson, "Who Gets U.S...
...Senate aide noted: "PL 480 recipients have not been in a position to complain about the grain and food they receive...
...But even with an investment of several hundred thousand dollars, and hundreds or thousands of acres, the grain farmer is caught between the banks and the corporations that provide capital inputs on one end, and the grain monopolies on the other...
...corporations to help them finance the establishment of new subsidiaries abroad.** A further use of counterpart funds was to provide "economic assistance" to U.S...
...concessional programs, while others have "graduated" from PL 480 and now use their meager foreign exchange to satisfy the new demand for U.S...
...2 9 ** U.S...
...food policy...
...export strategy...
...farmer are just as serious as for other working people...
...United States Department of Agriculture (U.S.D.A...
...1964 Belgium Feed plant Part of the Hens companies acquired in 1964...
...1972 Brazil Soybean plant Compiled by NACLA27 Cargill's subsidiary, Shaver Poultry, moving chicks in Pakistan use local currency from the proceeds of PL 480 sales to finance the establishment of local subsidiaries...
...Just as important for long range U.S...
...As one former grain company official who now works in the export division of the Agriculture Department noted, with PL 480 "we taught people to eat wheat who didn't eat it before, particularly in the Far East...
...grain imports...
...During the outward expansion of Western Europe and the subsequent expansion of the United States, once self-sufficient economies were destroyed as the more developed countries extracted agricultural and mineral wealth...
...For malnourished people in the Third World, these U.S.-produced high-protein foods are no solution to hunger, since they are an expensive source of protein and are thus inaccessible to the most needy...
...agribusiness corporations in maximizing their profits by exploiting cheap labor in Third World countries to produce and process food for export to affluent markets...
...Title of a brochure put out by the American Feed Manufacturers Association in 1961...
...Expropriated in 1973...
...See also, "The Effect of Corn Marketing by the Commodity Credit Corporation upon Small Business," Hearings before the Subcommittee on Special Investigations of Small Business Problems, June 14, 15, 22, 23, and 29, 1966...
...One month later, the Department of Agriculture explained that "a major consideration [in the NEPI is the need for American agriculture to remain a growth factor and to continue expanding its markets abroad...
...trade mission to the Soviet Union was fully briefed by the CIA, which keeps a close watch on crop developments in the Soviet Union, and the mission was able to observe conditions first hand...
...Subsidized PL 480 food has undercut local producers and alleviated the pressure on Third World governments to make the structural changes essential to expanding food production...
...Feed Grains Council (whose members include the major grain exporters) has encouraged other countries to develop integrated livestock and poultry industries, where animals are fed on U.S...
...Of the five grain companies, Cook is the only one which sells its stock to the public...
...9. Harry Fornari, Bread Upon the Waters, Aurora Publishers Inc., Nashville, Tenn., p. 93, pp...
...Although the First National Bank provides Cargill with only a small part of its capital needs, it heads up the First Bank System which controls 88 banks in five Midwestern states...
...The adverse impact on Third World countries' ability to purchase food was of secondary concern, however, to U.S...
...He sold his shipping interests just before the bottom dropped * Unlike most large U.S...
...In fact, the long-run impact of U.S...
...strategy for driving up the price of food on the international market, and Kissinger's efforts to use food as a weapon against other countries, must be opposed whenever possible...
...CONCLUSION: PROFITEERING & THE FUTURE OF THE GRAIN TRADE The shift in U.S...
...The consequent food shortages were an important factor in creating middle class discontent with Allende's government...
...wheat...
...Profits turn on their ability to project the movement of market forces with a high degree of accuracy and to adjust their strategies accordingly...
...For American grain...
...1964 France Feed plant Part of the Hens companies acquired in 1964...
...See A. V. Krebs, "Of the Grain Trade, By the Grain Trade and For the Grain Trade," in Catherine Lerza and Michael Jacobson, ed., Food For People Not For Profit (New York: Ballantine Books, 1975...
...agricultural surpluses, to help keep farm prices high, to bolster the U.S...
...4 8 The Soviet wheat deal played an especially important role in Cargill's profiteering...
...grain trade view the companies as 19th century robber barons and propose government regulation to force them to respond to public needs...
...export strategy, the vast Soviet market was finally opened...
...The importance of Chile's survival to U.S...
...Sen...
...and Daniel Balz, "Economic Report/ Exports, High Food Prices Boost Administration Efforts to Reverse Farm Policy," National Journal, February 24, 1973...
...food exports to Japan now amounting to more than $3 billion annually, that country is the largest single market for U.S...
...government grain reserves were virtually depleted, and as a result, food costs soared...
...9 FOOD POWER IN CHILE Like other forms of U.S...
...The History of Cargill, op...
...cit., pp...
...and some admit that Americans will have to adjust to a permanently lower standard of living...
...Thomas Enders, Assistant Secretary of State FOOD FOR WAR As U.S...
...In Guatemala, a domestically produced blended food was undercut by U.S...
...Two important figures with direct ties to major agribusiness corporations were members of the Commission: Edmund W. Littlefield, chairman of Utah Construction and Mining and head of the powerful Business Council, who also sat on the board of Del Monte Corporation...
...The export drive must go on, but at the same time constantly rising food prices continue to undermine the position of poor and working people around the world...
...out of the maritime industry in the Panic of 1857 and moved to Wisconsin to become a gentleman farmer...
...In the age of monopoly capitalism, these companies hold a unique position...
...economic crisis...
...4 With their ability to thrive on market fluctuations, the grain companies are among the most vociferous defenders of the so-called free market...
...See also, "Sales Soar, Nearly Triple Cargill Profits," Minneapolis Tribune, December 2, 1973...
...Agency for International Development, The War on Hunger: A Challenge to Business, ca...
...509 396 Egypt...
...Feed Grains Council and the Western Wheat Growers Associates, have been funded through PL 480 to promote consumption of their products throughout the world...
...Unlike other forms of foreign aid, PL 480 country programs are not subject to annual congressional appropriations...
...According to this argument, the United States has a natural advantage in grain production...
...Transportation figures prominently in Cargill's manipulation of the domestic market...
...allies in the form of grants for "common defense...
...A.NEW AGRICULTURAL POLICY The man Nixon brought in to head the Agriculture Department and orchestrate the export drive was Earl Butz...
...3 ' For U.S...
...grain exporters since its inception in the mid-sixties...
...Today, the company has offices and plants in 34 different countries...
...Cargill is using the high profits of recent years to rapidly diversify its holdings in non-agricultural areas...
...The Overseas Private Investment Corporation (OPIC) lent Cargill Agricola $2.5 million for the soybean processing plant, while the Eximbank has helped out on three separate occasions with loans totaling over $1 million...
...supplies...
...Although Cargill lost the legal battle when its Illinois subsidiary was excluded from trading on the Chicago market, it won the economic war, since the subsidiary was already in the process of dissolution and the parent company was able to continue expanding in the Chicago grain market...
...A principal concern of U.S...
...While this means that local currencies are no longer directly manipulated by the U.S...
...efforts to prop up the Junta with economic and military aid have met with strong resistance in the United States, and the Administration has been forced to rely heavily on PL 480 to channel funds to Chile...
...working people...
...Second, through these commodity arrangements Kissinger hopes to establish ground rules that assure U.S...
...The current world food crisis is not a crisis of production or overpopulation, but rather a crisis of distribution...
...Partly because of the CAP, U.S...
...6. Interview with John Schnittker...
...Nixon's turnaround had an immediate impact: in November 1971 the Soviets purchased 3 million tons of U.S...
...Founded in 1865, Cargill is the only major grain company with roots in 19th century America...
...Control of these currencies gave the United States an important mechanism to further U.S...
...trade strategy...
...Cargill has not disclosed its 1974 sales...
...Democratic Party official, op...
...In 1968 Cargill announced it would build an integrated poultry operation that included a poultry breeding farm, a large feed processing plant, and a poultry processing' unit...
...grain reserves, and, as an inevitable consequence, to raise world food prices...
...While small Title II donation programs under the voluntary agencies continued, this was in keeping with the U.S...
...THE ASSAULT ON THE COMMON MARKET A focal point for U.S...
...imperial interests, it is apparent that Third World countries cannot look to the United States government for a solution to the on-going crisis of hunger...
...Every year the Department of Agriculture purchases tens of millions of dollars worth of grain and soy-based high protein foods from U.S...
...grain sales into his detente strategy...
...The Williams Commission concluded there are only two categories of exports where the United States still maintains a competitive advantage: in high-tech* Data from a comprehensive study of multinational investment patterns (to be published by NACLA in 1976) indicates that until the 1960's, the multinationals did generate a positive balance of trade for the United States...
...For the U.S...
...In Brazil, for example, as a result of a U.S...
...2 9 SOUTH KOREA & MIDDLE EAST With the defeat of U.S...
...grain, even if it means a disastrously inefficient use of the world's protein supply...
...Under the "Cooley loan" program, local currencies were loaned to U.S...
...8 Since 1971, the United States has insisted on dollar repayment of PL 480 credits, with the notable exceptions of Cambodia and South Vietnam...
...53-56, 48-49...
...General Accounting Office, Alleged Discriminations and Concessions in the Allocation of Railcars to Grain Shippers, 1974, pp...
...Cargill had especially close ties to Richard Nixon...
...Because Cargill doesn't just sell grain...
...2 4 The report predicts that the prospects for U.S...
...Thus, Kissinger was able to meet U.S...
...Nations which concentrate their efforts in areas where they are most capable enjoy a comparative advantage in world trade...
...Today, Cargill uses Shaver to form an integrated package of feed mills and poultry breeding stock when it moves to establish operations in other countries...
...At the World Food Conference in Rome in 1974, the U.S...
...agriculture...
...Sources: Foreign Agriculture, 5/26/75...
...14 "The food producers' monopoly exceeds the oil producers' monopoly, and this will increase over time...
...The growth of capitalism carries with it increasing disparities in income distribution, and therefore the rise in food production does little to alleviate the plight of the malnourished and the hungry...
...The rest of the Third World gets crumbs...
...United States Department of Agriculture, Commodity Credit Corporation, Storage and Handling Payments, 1958-1968...
...government and the grain industry, the growing food deficit of Third World countries is fertile ground for commercial exploitation...
...llI H E G R AIN TR ADE A Seedy Business The Soviet grain deal, the worldwide grain deficits, and the recent grain inspection scandals - all have pushed into the limelight a group of companies that traditionally avoid publicity...
...At present the three main U.S...
...21, 1974), promoting the idea that the United States should become the world's granary, in the name of comparative advantage...
...Quote attributed to ex-president of General Mills by retired official of Minnesota Democratic Party...
...When he left Purdue University to join the Nixon Administration in 1971, Butz had to relinquish seats on the boards of three agribusiness corporations: Ralston Purina, Stokeley Van Camp, and International Minerals and Chemicals...
...government is committed to a 5-year plan to modernize the South Korean army at a cost of $400-$500 million...
...When Palmby left that job in 1972 he became vice-president of Continental Grain, one of the largest grain traders, and he was replaced by Carroll Brunthaver, who came to the Department from Cook Industries, another major exporter...
...Even before these actions, Chile was slated to receive the largest PL 480 allotment in Latin America - $35 million out of a total of $50 million...
...Then in 1964 Cargill acquired the Hens companies, a major feed manufacturing * Nutrena is one of the three largest U.S...
...foreign policy...
...Forbes...
...2 His sons soon adapted their father's trading talents to the agrarian economy of the Midwest...
...In this context, Secretary of State Henry Kissinger in 1973 directed the National Security Council (NSC) to undertake a comprehensive study of U.S...
...Like the modern grain companies these merchant houses relied heavily on banks to finance their trading operations, and they made direct investments in port facilities and shipping...
...At about the same time, Cargill began constructing a soybean processing plant in Spain...
...The Argentine subsidiary is now run by executives stationed in Brazil...
...4 2 The ties go back at least as far as Nixon's vice-presidential days when he was entertained several times by the company in Minnesota...
...But most importantly, the thinking of the Commission was behind all the major moves made by the Nixon Administration in the field of agriculture...
...Another was to rely more heavily on food aid to support U.S...
...The United States, in turn, will guarantee access to U.S...
...government finances donations to "friendly" nations by private international relief agencies...
...Although originally conceived as a mechanism to dispose of U.S...
...It dealt primarily in cotton trading until the early 1960's, when Edward "Ned" Cook, the head of the company, began diversifying...
...agricultural exports to Europe had declined by about 15 percent between 1966 and 1969.25 The United States is also demanding the end to domestic farm support policies in Western Europe which, in the view of the Flanigan report, sustain millions of small and inefficient farmers...
...Trade associations, like the U.S...
...3 3 * In the last twenty years, the number of farms in the United States has decreased by two-thirds...
...7. Interview with former official of the Agency for International Development, who now works as a consultant in Washington for agribusiness firms, including one of the major grain companies...
...list of Most Seriously Affected nations...
...It has served principally as a forum for negotiating trade liberalization...
...Cargill officials also serve in government positions...
...The Ford Administration, while requesting a temporary moratorium on exports, is avoiding export controls that would protect the American working people against a further decline in their standard of living...
...8. Yost, op...
...go) formulate foreign policies...
...and William R. Pearce, a vice-president of Cargill, Inc., the world's largest grain company...
...It erected large 2122 grain terminals on the Great Lake ports, and even built short railway lines to link major commercial and transportation routes in the Midwest...
...one of the Fact Sheets on Food prepared by the URPE National Food Research Collective...
...Not only did the United States deny food aid credits, but shortly before the coup a request from the Allende government to purchase U.S...
...and Journal of Commerce, September 26, 1975...
...3 2 Unable to profit from its Korean operations, Cargill again fell back on the resources of the U.S...
...The company now had a completely integrated trading network which handled grain from the small country elevator to its final sale in the eastern markets...
...interests overseas...
...Between 1963 and 1971, the U.S...
...Domestically, the company operates at the three main points of grain collection and distribution: the local elevators where the farmer sells his grain, the subterminals and terminals at the major transportation crossroads, and the large export elevators located in major U.S...
...Cargill is a member of the U.S.-U.S.S.R...
...In other words, they should abandon policies aimed at self-sufficiency and allow the United States to become the world's granary...
...efforts to expand food exports is the multilateral trade negotiations being carried out under the auspices of the GATT.* Preparations for the current negotiations (expected to last several years) began in the early 1970s...
...One small grain company executive who was recently caught bribing a Salvadorean official proclaimed that such payoffs are "not at all unusual...
...2 3 It owns grain elevators and storage facilities, arranges regional financing with foreign banks, employs a large number of sales agents, operates its own shipping network, and deals heavily in buying and selling foreign currencies...
...The State Department quickly mobilized to get around the 30 percent limitation on the political distribution of food aid...
...John H. MacMillan, a member of the prominent business family from LaCrosse, Wisconsin, married into the Cargill family in 1895 and soon assumed important administrative positions...
...cit., p. 275...
...farm surpluses and to pave the way for later commercial sales, the program's political potential was immediately recognized by its proponents...
...The outbreak of the Korean War caused only a brief spurt in grain exports...
...for internationally oriented policies...
...Cargill was in the forefront of the push by business to develop new markets for farm production...
...12 One grain company representative summed it up even more bluntly: "PL 480 enabled the companies to gain entrance into a market at the smallest expense possible...
...Although the Agriculture Department consistently tried to prevent grain surpluses by withdrawing land from production, farm support programs actually led to increased farm output, since guaranteed high prices encouraged production...
...policy makers was well summarized by a member of the National Security Council who commented, "To give food aid to countries just because people are starving is a pretty weak reason...
...Under a rational and planned economic system this minor decline would not have resulted in a world-wide crisis...
...In reality, the main beneficiaries are the U.S...
...According to one U.S...
...flag vessels, in response to demands by the maritime unions...
...Ever since the conclusion of the previous GATT negotiations in the mid-1960s, the grain traders had protested bitterly that their interests had been ignored...
...In addition Cargill has set up new subsidiaries such as Cargill Leasing, and bought up scores of small businesses around the world...
...The other loan, for more than $1 million, came from the Private Trade Entity provisions of PL 480, which extends credits to foreign subsidiaries of U.S...
...Harold Cooley, once powerful head of the House Agriculture Committee...
...CARGILL 1. Cargill Today, no publication date, issued by Cargill between 1965 and 1968...
...government officials often claim that Americans spend only 15 percent of their income on food, but as data compiled by the Union for Radical Political Economics (URPE) reveals, this average figure does not take into account the skewed distribution of income in the United States...
...The disparity between the rich and poor is thus likely to get even wider...
...The attitude of U.S...
...When one recalls that Cargill controls much of the flow of grain on the railway system without owning a single locomotive, that it received millions of dollars in storage payments for holding CCC grain surpluses which it could buy and sell at a moment's notice, and that much of Cargill's international trade is financed by PL 480 and other government lending programs, then one has a some understanding of how Cargill runs its commercial system...
...Interview with Department of Agriculture official who sits on the inter-agency committee...
...By early 1972, National Security Advisor Henry Kissinger became directly involved, with the intention of incorporating U.S...
...and its philosophy is reflected in the 1975 Economic Report of the President...
...Senate Committee on Agriculture and Forestry, Hearings on U.S...
...The immediate causes, such as the U.S...
...1 8 Finally, the White House simply circumvented Congress by increasing the total budget for PL 480 from $1 billion to $1.6 billion-something it had refused to do at the Rome Food Conference...
...First, in the late 1940's, Cargill opened a new access route to the Mississippi River by widening the Minnesota River channel, thereby enabling the company to bypass Minneapolis where labor costs and municipal regulations made grain handling more expensive...
...Bunge Corporation The Bunge Corporation, based in the United States, forms part of the worldwide financial empire of Bunge & Born...
...That means FINDING markets, or creating them...
...farmers' input costs...
...Controlling some 10 percent of the U.S...
...I U z Drawing by lmcIcK Logan xx 20 THE BIG FIVE Cargill, Inc...
...near-monopoly position as food exporter...
...6. U.S...
...economic aid to Chile, PL 480 has been an off and on spigot in the last several years: "off" for the socialist government of Salvador Allende, and "on" for the military dictatorship the U.S...
...The Central Intelligence Agency, Office of Political Research Potential Implications of Trends in World Population, Food Production, and Climate August 197417 Treasury George Schultz decided to use the issue of food as a lever against OPEC...
...diplomacy, it has long been an instrument of U.S...
...With the close of the Civil War, railroads began to crisscross the Midwest, thereby providing wheat farmers with ready access to national markets, while at the same time opening up new lucrative opportunities for the merchants and grain traders...
...2 5 Cargill is already laying plans for the end of government export controls: late in 1974 it purchased National Grain Limited, a Canadian company with 268 local elevators and a large grain terminal...
...policy-makers must use every means at their disposal to support the Park dictatorship against growing popular challenges to its repressive policies...
...3 2 The promise of this money undoubtedly served as a highly persuasive bargaining lever for Kissinger in obtaining the recent Middle East agreement...
...New York Times, February 19, 1975...
...the remainder is generated by activities ranging from feed milling to metals trading...
...The post-war period proved to be an even greater boom for Cargill...
...Cook has few food processing subsidiaries abroad, although it has set up a new agribusiness firm called World Food Systems, Inc., which contracts with governments abroad to run institutional meal programs...
...exploitation of their natural resources...
...4. Williams Report, op...
...For three of the five firms - Continental Grain, Bunge, and Dreyfus - these 7--25 extensive European operations are attributable to their family and commercial roots in nineteenth century Europe...
...Copyright 1975 by the North American Congress on Latin America, Inc...
...In justifying this approach, one official in Agriculture's Market Development program said, somewhat apologetically, in an interview, "Rich people have to eat too...
...foreign policy makers is revealed by the fact that Chile ranked 6th worldwide on the list of recipients of PL 480 credits in fiscal year 1975...
...By 1971, more than $1.7 billion had been spent in this way, with two thirds going to South Korea and South Vietnam...
...Washington Post, 3/10/75, 3/12/75, 7/5/75...
...And to advance the interests of the U.S...
...8. For a radical analysis of the history of U.S...
...As the Williams report pointed out, free trade would allow U.S...
...feed grains...
...Can Agriculture Save the Dollar...
...Hightower, op...
...Thomas Hart Benton "Cradling Wheat" 193812 II...
...government and the grain corporations have used this position of dominance over the world's grain supplies to exploit people at home and abroad...
...An Account of Early Years, Cargill, Incorporated, 1965, pp...
...Interview with John Schnittker...
...Thus, the ultimate solution to the crisis can only come about through a radical change in the economic system...
...1967, p. 5. 25...
...cit., p. 76...
...The White House was, according to one of the participants, "deeply involved," through both Henry Kissinger and the staff of the Council on International Economic Policy...
...in Steve Weissman, ed., The Trojan Horse (San Francisco: Ramparts Press, 1974...
...foreign policy is clear...
...grain, policy-makers launched a new initiative to incorporate "food power" into U.S...
...As the Commission's figures revealed, by 1970 the United States' post-war trade surplus in manufactured items had turned into a deficit of $5.5 billion...
...4 The growing domination of the farmer's economic life by the railroads, the grain traders and the banking interests led to the Populist revolt in the 1880's and 1890's...
...Cargill of course possessed neither of these ties...
...imperialism is exemplified in its South Korean operations...
...This has helped make that country the fifth largest market in the world for U.S...
...and abroad.30 FOOD WEAPON Footnotes FOOD EXPORTS 1. U.S...
...E. C. Fuller, the assistant vice president of Cargill in charge of its Korean operations, believes the employees' training in the martial arts makes them ideal workers...
...As a State Department memo revealed, and food aid allocations indicated, Chile, South Korea and the Middle East were also high on the list of U.S...
...Senator Hubert Humphrey April, 1974 for new capital investments, and generally maintains a legal and financial system that is essential for the survival of Cargill and other monopolistic corporations...
...THE FOOD WEAPON "Mightier Than Missiles" In the midst of the widespread famine of recent years, it has become dramatically clear that the United States will use its agricultural abundance not to alleviate starvation, but to further its own imperial interests...
...corporations into the Third World...
...But this target price is set so low it does not even cover the farmer's cost of production...
...2 6 Japan is one of the world's leading grain importers...
...Grain farmers are in a somewhat unique position in U.S...
...And it is also a strategic weapon against Third World countries which challenge U.S...
...3. Interview with former employee of Cargill...
...Over a century old, Cargill buys and sells commodities in every corner of the globe while also operating manufacturing plants that process everything from Midwestern feed grains, to salt in Louisiana, and soybeans in Brazil...
...Three years later, most of Cargill's properties were placed in receivership, and the Cargill grain merchandising empire appeared to be on the brink of dissolution...
...Ibid...
...2 Although we can only speculate on the contents of the NSC study, a widely leaked report prepared at the time by the CIA's political section gives insight into the thinking of U.S...
...THE AID WEAPON The chief weapon in the U.S...
...Hubert Humphrey put it even more bluntly when he said, "Food is power...
...The reason for this policy of maximizing exports regardless of domestic costs goes beyond the Administration's commitment to "free trade" and maintaining the profits of the grain companies...
...The United States refused and the meeting broke up...
...Although ostensibly set up, like PL 480, to dispose of surpluses and develop markets, it has also been used to further U.S...
...112-13...
...But while striving to correct these policies, we should not lose sight of the fact that the basic problems of hunger, malnutrition, and rising food prices are rooted in capitalism itself...
...New York Times, September 19, 1975...
...Throughout much of the world, living standards have been improved through specialization of labor and resources...
...In fact, events surrounding the recent large Soviet purchases suggest that U.S.-Soviet relations have reached a new level of accommodation...
...Although the sale was secretly negotiated, three days later President Nixon announced a U.S.-Soviet agreement whereby the CCC would offer a $750 million credit to finance Soviet grain purchases over the next three years...
...At the same time, the United States faced new challenges from Third World nations, especially the OPEC countries, who moved to assert greater control over their natural resources...
...And more importantly, in response to the Ford Administration's desire to control the inflationary impact of future Soviet purchases, the Soviet Union has agreed to work out a long-term arrangement to make regular, large purchases from the United States.21 As part of this agreement, the Soviets will reportedly also supply the United States with 3 percent of its oil import needs...
...A succession of reports by U.S...
...As many grain company executives are fond of pointing out, the trade is highly competitive...
...1865-1945, Minneapolis, Minn., 1945, p. 14...
...could give the U.S...
...And why Cargill is now building up poultry in Pakistan and Taiwan...
...Unpublished study by William Goodfellow, former member of the Indochina Resource Center, Washington, D.C...
...Cargill is Argentina's leading exporter of wheat, barley, maize and other grains...
...After his defeat in the California gubernatorial race in 1962, Nixon went to work for the Wall Street law firm of Mudge, Stern, Baldwin & Todd, which counted Cargill among its corporate clients...
...In 1972, for example, the decline in world food production due to adverse weather conditions was less than 1.6 percent...
...The flexibility this allows the State Department is indicated by the fact that at the beginning of fiscal year 1974, Cambodia was slated to receive $30 million in food aid, but by the end of the year had actually received $194 million...
...1964 Argentina 2 feed mills Mills in Saladillo & Capilla...
...This is in response to Third World demands at the Paris energy conference last spring to broaden discussions to deal with the whole range of raw material questions...
...strategic interests has shifted elsewhere - to South Korea and the Middle East...
...Not only were U.S...
...Domestically, the State finances port facilities, grants the company tax concessions28 "Food is power...
...Cargill did enter into a joint venture with Toyo Futo Company in 1966 THIS LITTLE PIGGY MADE A MARKET...
...However, Continental owns two important processing companies, Oroweat Bakeries, and Allied Mills (a manufacturer of livestock feeds), and operates large flour mills in Venezuela, Ecuador, Puerto Rico, Guadeloupe and Zaire...
...10004...
...With most of the economies of the world in disarray, the United States became the world's principal food supplier...
...Price supports also kept U.S...
...For several decades, the Department of Agriculture has been working to open a wedge in foreign markets for U.S...
...if the cooling trend in the world's climate predicted by climatologists] continues for several decades there would almost certainly be an absolute shortage of food...
...Many critics of the U.S...
...government involvement in the Soviet grain sales is based primarily on information revealed in the hearings held by the Permanent Subcommittee on Investigations of the Senate Committee on Government Operations, on Russian Grain Transactions, July 1973 (Washington, D.C.: G.P.O., 1973...
...strategists sought desperately to prop up the tottering regimes in South Vietnam and Cambodia, PL 480 funds became a direct military subsidy for the Indochina war machine...
...Cargill in effect is now a mini-conglomerate involved in an array of operations that have no direct relations to the grain trade or to food processing...
...Although originally set up to barter surplus agricultural commodities in exchange for strategic materials, by the 1960s the program was used almost exclusively to finance the overseas operations of the Department of Defense and the Agency for International Development...
...trade crisis was competition from Japanese and European manufactured * By the State we mean the array of governmental and political institutions that help sustain capitalism...
...Interview with George Shanklin, Assistant Administrator, Commercial Export Programs...
...As one former Under Secretary of Agriculture noted, "The grain companies are always at the elbow of people in the U.S.D.A...
...6. Ibid., pp...
...2. See Leslie Gelb and Anthony Lake, "Less Food, More Politics," Foreign Policy, Winter, 1974-75...
...attempts to apply the principle of comparative advantage are well illustrated by the case of Colombia...
...Also a September 5, 1975 letter from the Eximbank...
...In one recent year, Cargill borrowed more short term cash than any other corporate entity in the United States...
...While farm debt has increased 355 percent in the last two decades, as capital continues to invade the farm sector, the farmer has received a declining share of the food dollar...
...To dispose of these surpluses Congress passed Public Law 480 in 1954, and the State acquired a new mechanism for promoting U.S...
...46 The grain trade has been very active in pushing detente...
...grain exports, Kissinger then proceeded to tell the OPEC countries they had a "special responsibility" to finance international food aid to poor countries.3s The policy of confrontation was brought to a new level in the fall of 1974 when President Ford, in a speech to the U.N...
...cit., pp...
...In all of these instances legislation was passed, or policies were established, that reflected the general interests of the grain trade...
...food grains...
...In 1973 the company possessed net assets worth only $352 million, but with this relatively small capital base it conducted a volume of trade worth $5.3 billion...
...agriculture - chronic overproduction and the resultant depressing effect on farm income - the State had become heavily involved in the farm economy...
...Specialization is closely linked to "interdependence," a term frequently used by Kissinger and the multinational corporations to convince the Third World that they benefit equally from the current international division of labor...
...Since 1954, 419 U.S...
...wheat for cash was denied "because of a political decision at the White House...
...But after Congress cut more than 20 percent out of the Administration's economic aid request for Indochina, the White House more than doubled the PL 480 allocation to $499 million.12 This meant that South Vietnam and Cambodia received half the total U.S...
...6 Cargill's use of cut-throat business practices and its rapid pace of expansion upset many of the established grain trading interests...
...One company official noted that hardly a month goes by without Cargill and Chase officials holding consultative meetings...
...In 1973, a food credit to the Dominican Republic was made conditional upon much larger commercial purchases...
...See also Walter Cohen, "Herbert Hoover Feeds the World" in Weissman...
...Even the Title II donation program should be seen, at best, as only a stop-gap measure which ignores the systemic causes of hunger...
...wheat crop...
...Interview with Washington, D.C...
...Dissertation, Rutgers University, New Brunswick, New Jersey, May 1975...
...and in 1971, the U.S...
...Depending on the rise and fall of grain prices, a shipment originally destined for Europe may be assigned to Panama, only to ultimately wind up in Japan...
...5. The History of Cargill, op...
...food under PL 480 became an effective instrument for dumping U.S...
...Gelb and Lake, op...
...strategists were well aware that the repercussions of U.S...
...But in the long run its insatiable quest for profits and markets can only increase the discontent felt by working people in the U.S...
...Food for Profit," NACLA Newsletter, May-June, 1971...
...But when it comes to putting it into practice, we've still got a long way to go...
...Butz's announced goal of "getting the government out of agriculture" meant the reversal of policies that had prevailed since the 1930's...
...As one government officer investigating the grain trade observed, "In the U.S...
...food diplomacy...
...2 4 And in Canada, although the country's grain exports have been controlled by the Wheat Board ever since 1935, Cargill and Continental Grain are both maneuvering with Canadian agribusiness interests to open up the trade to private companies...
...His son, Tom Palmby, works for Cargill.4s At the Department of Agriculture, Clarence Palmby played an important role in the shift to policies that Cargill had been advocating for years...
...agriculture in the 1970's), he served as deputy special trade representative with the rank of ambassador, and he headed up an interagency team that guided the 1973 Trade Reform Act through Congress...
...policy-makers were searching for ways to support the Indochina war effort...
...refusal to grant emergency food aid, Cofigress passed an amendment requiring that 70 percent of U.S...
...Business Week, August 25, 1975...
...Under this program, food was sold in overseas markets by private exporters, who then either turned the sales proceeds over to the government agencies, or used the money to procure goods and services for the agencies' operations abroad...
...3 Kissinger's attempts to extract maximum political advantage from the U.S...
...Japan...
...grains...
...The report projects that a liberalization of trade would benefit the U.S...
...Five companies - Cargill, Continental Grain, Cook Industries, Bunge, and Dreyfus - dominate the world's grain trade and control about 85 percent of U.S...
...might regain the primacy in world affairs it held in the immediate post World War II period...
...political commitments, not only in Indochina, but in other countries as well...
...Third World nations do import food, but the same market mechanisms operate within these countries: the affluent minority eats increasingly well while the masses go hungry...
...Congress annually subjected the foreign aid bill to close scrutiny, and increasingly wrote in limitations on the Executive's use of funds...
...Although the grain companies perform a function similar to that of the old commercial houses, they are driven by the forces of modern capitalism...
...AGRICULTURAL EXPORTS Country 1974 1975 MIl...
...And at the end of the decade, Cargill joined the growing list of U.S...
...As a result, the world food economy has been left to the volatility of a "free market," where a slight shift in demand either up or down causes a huge swing in prices...
...export drive succeeded in depleting CCC reserves and expanding markets overseas (without which farm prices could plummet disastrously in a free market...
...From the moment the grain is purchased until the time it is finally sold abroad, Cargill and other exporting companies must have sufficient funds to cover the costs of carrying these large quantities of grain...
...Interview with Minnesota Democratic Party official who is close to Cargill executives...
...agricultural exports, wheat and flour, jumped from 48 million bushels in 1944 to 503 million in 1948!9 PL 480 Although the U.S...
...Even though at the beginning of each fiscal year AID-which jointly administers the program with the Department of Agriculture-submits a projected budget, this list is only an estimate which can be altered without congressional approval...
...These companies literally hold the power of life and death over millions of people...
...government agencies," it diversified its operations and prof- ited from the war...
...PL 480 also serves as a handy tool to undercut competitors in foreign markets and to coerce aid recipients into increasing commercial purchases from the United States...
...Nominally set up to control speculation and profiteering in the grain trade, the Board in reality is dominated by the grain trading interests which it is supposedly regulating...
...And expanding them...
...The consequence of U.S...
...In April of 1973, it was declassified at the insistence of the Senate Agriculture and Forestry Committee, and printed by the Government Printing Office for use of the Committee...
...see also Des Moines Register, February 19, 1975...
...market development efforts have undermined local industries...
...Cargill Incorporated, Cargill Building, Minneapolis, Minnesota 55402 From Cargill ad in Southwestern Miller26 the Latin American countries most susceptible to bribery in arranging grain deals...
...Counterpart funds were used to underwrite the expenses of U.S...
...While U.S...
...Cook did not enter the grain trade until the 1960's, thus the low figure...
...As Forbes magazine commented, "Agriculture is at the heart of every Administration major move of late...
...agricultural exports is not an overnight phenomenon...
...This year, PL 480 loans to Egypt for wheat and to South Korea for rice were tied to additional commercial purchases of those commodities...
...Official silence was not without purpose: the grain exporters were able to purchase enough grain to fill Soviet orders before news of the sale sent commodity prices skyrocketing, and U.S...
...He notes: "They have an awareness of danger, a familiarity with hardship and an eagerness to face the future that is enviable...
...government reserves would inevitably push up prices...
...Officials claimed that the limitation applies only to food, not to other commodities shipped abroad under PL 480, such as tobacco and cotton...
...For decades, Cargill has enshrouded itself in a veil of secrecy precisely to ward off this possibility: it realizes that publicity about the company's operations can only lead to increased public hostility...
...7 Since PL 480 credits are no longer repaid in local currencies, the Cooley loan program has ended...
...The second article deals with how Washington uses "food power" as a diplomatic weapon to advance U.S...
...products distributed under PL 480 Title 11 donation programs...
...Thus, the "success" of U.S...
...has the capability to produce grain and other foodstuffs in abundant quantities...
...exports expanded greatly during the post-war boom, U.S...
...policies contribute to the food crisis, they are only the current manifestations of more fundamental forces that have for centuries prevented the world's food resources from being used to satisfy people's needs...
...As one Cargill official noted in discussing the company's Brazilian operations, "Cargill has a stupendous growth rate in Brazil...
...And You" (Washington, D.C.: Agribusiness Accountability Project, mimeo, 1973...
...Last spring, and more recently at the September United Nations meeting, Kissinger proposed that producing and consuming nations come together in forums, on a commodity by commodity basis, to work out commodity arrangements...
...Continental Grain Company Run by the Fribourg family, which owns 90 percent of the stock, Continental Grain originated in Belgium in 1813...
...Its subsidiaries in these two countries are in effect "miniCargills...
...The companies can either sell the commodities and use the proceeds to finance their operations, or else use the commodities to supply their processing plants...
...Under the new farm program, farmers are paid direct income subsidies if the market price falls below a set "target price...
...Since all sales proceeds now go into the general budgets of receiving countries, specifications as to their use are virtually meaningless...
...policy makers are walking a thin line...
...Using loan repayments on PL 480, the Department of Agriculture last year gave private agricultural associations $12 million to support their promotional efforts...
...blended and fortified food products have the potential of opening up a whole new field of international marketing...
...food aid go to countries on the U.N...
...share of the world market during the 1960s...
...food in Japan and Europe...
...political as well as economic interests...
...economic aid to Chile was the second highest for Latin America), and completely cut off military aid...
...But the Cargill fortune was saved by the infusion of new blood into the company administration...
...economy...
...3 211 The impact in Third World countries, where most people spend 80 percent of their income on food, is to bring millions closer to starvation...
...Figures are from "Agriculture: the Biggest Growth Industry," Business Week, April 28, 1973...
...In spite of the fact that food production has grown at a faster rate than population ever since World War II, the "market mechanism" allocates food to those who have purchasing power and not necessarily to those who are hungry...
...Although the U.S...
...The Agriculture Department's study, known as the Flanigan Report, fully endorses the Williams Commission thinking on comparative advantage and free trade...
...The "Flanigan Report," officially entitled Agricultural Trade and the Proposed Round ofMultilateral Negotiations, was completed in 1972 and kept classified...
...AID mission in South Vietnam from 1966 to 1968...
...5 The Great Depression did little to deter the company's expansion...
...Former employee of Cargill, op...
...The quality of the grain that these countries receive under PL 480 sometimes leaves much to be desired...
...food arsenal was called into service to rescue the Junta...
...At the end of World War II, the U.S...
...At the same time, the South Korean government became less responsive to the demands of multinational corporations...
...government, in an effort to overcome the deepening trade crisis, launched a drive to expand agricultural exports, and in the process touched off an unprecedented increase in world food prices...
...on U.S...
...Because Cargill in many cases controlled the only elevator at major railroad stops, the local farmers were often forced to accept the price offered by the company for their grain...
...Known collectively as the grain trade, these companies hold a pivotal position in the world's food supply system...
...1963 Spain Soybean plant Began production 1965...
...It is heavily involved in the grain inspection scandals, with some of its top officers under indictment...
...As a result, the Japanese are now major consumers of U.S...
...grain processors with an important market...
...This is why Cargill has helped foster new meat and poultry industries in Japan (now our nation's to construct new grain handling facilities in Japan...
...The treatment of the U.S...
...And as the manufacturing facilities of the multinationals continue to move abroad, the productive base of the U.S...
...This has been accomplished under two main provisions of the law: Title I, which accounts for three fourths of the program, provides dollar credits (at 2-3 percent interest, repayable in 30 to 40 years) to "friendly" foreign governments to finance the import of U.S...
...Even though U.S...
...In spite of the commitment of government and corporate leaders to "free enterprise," State intervention was essential to meet the constant threat of overproduction and farmer discontent...
...Dreyfus is a part owner of DWS, Inc., a New York firm that owns and manages real estate in the United States and Canada...
...THE INTERNATIONAL FRONT The Administration's first major move on the international front to implement its export drive was the devaluation of the dollar in August 1971...
...Interview with Neal Smith, House of Representatives...
...The companies would probably prefer to operate abroad without providing funds for kickbacks, but if such payments become necessary for closing an important grain deal, then the dictates of business require that the bribe be paid...
...Such giants as Prudential, Metropolitan Life, and John Hancock are among the insurance companies that collect the savings of U.S...
...cit., p. 272...
...policy-makers, whose chief goal was to expand exports in the cash markets of the affluent countries...
...3 Despite large loans from the U.S...
...2 6 To force the Common Market countries to accede to U.S...
...Even today this trend continues...
...access to raw materials at stable prices, and prevent producers from taking independent action...
...6 Foreign governments use these credits to import food from the United States, and then sell the food13 "To give food aid to countries just because people are starving is a pretty weak reason...
...When the increased foreign demand for wheat placed an enormous strain on the U.S...
...An inter-agency staff committee nominally controls the program, but as one member of the committee observed, it is the State Department which decides the priorities for distributing PL 480, with the National Security Council and Kissinger himself playing a major role...
...U.S...
...Feed Grains Council, a trade organization dominated by the major grain companies, which is devoted to expanding U.S...
...2 8 One retired Cargill official, after first stating that his company was not involved, proceeded to name some of No...
...For one thing, Butz's announced goal of getting rid of U.S...
...183 757 United Kingdom...
...It has taken the farm economy out of jail.17 While it was impossible to predict the bad weather that devastated the Soviet crop in 1972 and caused the tremendous surge in demand, the deliberate decision to make significant sales to the Soviet Union was made at the highest levels of the White House at least as early as 1971.'8 In June 1971, Nixon announced a major policy change aimed at opening up agricultural trade with the Soviets: special export licenses would no longer be required for grain sales to the Soviet Union and the People's Republic of China...
...9 As one government official observed, "The food aid program today exists as an arm of Kissinger's foreign policy...
...wheat industry, AID introduced a wheat-soya blend to the Indian market...
...CARGILL AS A MULTINATIONAL INDUSTRIAL CORPORATION Cargill's expansion into foreign manufacturing in the 1960's was built on its U.S...
...Based in France, the Dreyfus family has been active in the grain trade since 1842...
...As the current Assistant Secretary of Agriculture said in an interview, "Our primary concern is commercial exports...
...proposals for a reserve system see Balz, "Economic Report/State-Agriculture Feud Delays Grain Reserve System," National Journal Reports, June 28, 1975...
...The effect of these support programs, (as in the U.S...
...The Trade Reform Act of 1974, pushed through Congress under the guidance of William Pearce, effectively directs U.S...
...companies with foreign operations when it established sales offices in the principal European grain centers and in Argentina, one of the world's grain exporters...
...There it forced out the old trading giant of the city, the Rosenbaum Grain Company, and soon became the largest grain merchant in the Chicago area...
...The ideal circumstance for the grain traders is a widely swinging market that allows them to take advantage of the ups and downs in supply and demand, and thus maximize their profits...
...Foremost among them is William Pearce, a vice president of the company...
...3. Central Intelligence Agency, Directorate of Intelligence, Office of Political Research, Potential Implications of Trends in World Population, Food Production, and Climate, August 1974...
...agriculture an advantage due to the devaluation of the dollar...
...Food prices have risen 43 percent since 1952, but the price the farmer receives for his production has increased only 6 percent...
...With massive sales to the Soviet Union in progress, 1975 is likely to be another record year...
...Even Cargill's official historian admits that by the late 1870's and 1880's the company held monopolistic trading positions "in southern Minnesota and South Dakota...
...Hubert Humphrey quoted in unpublished manuscript by NARMIC, American Friends Service Committee...
...3 The Cargills also extended their commercial influence by forming partnerships with a number of other grain merchants to erect or control elevators...
...This explains the companies' interest in the more speculative mechanisms of capitalism such as the grain futures market...
...Cargill, of course, rallied behind Nixon in 1968...
...Minnesota state politics are dominated by the Democratic Party (or the Democratic Farmer Labor party, as it is called locally), and Cargill works closely with many of its party leaders...
...Despite Cargill's expansion and prosperity, the men who run the company are uneasy about the future...
...While Kissinger has placed an unprecedented reliance on food aid as a prop for U.S...
...CARGILL Harvest of Profits Cargill, Inc...
...The food situation also has a disastrous impact on the balance of payments position of Third World nations...
...it also helped put detente on a firmer footing...
...Although capitalism requires these types of enterprises to keep the system functioning smoothly, they are located in the system's most exposed flank...
...As Administration officials admit, one effect of these sales will be rising food prices...
...This situation had serious implications for the United States' position in the world, since without a strong dollar and a healthy economy, the State* could not perform the many functions necessary to protect U.S...
...For the current fiscal year, the Administration again plans to rely heavily on food aid to support the Junta...
...Martha M. Hamilton, The Great American Grain Robbery & Other Stories, Agribusiness Accountability Project, 1972...
...However, Cargill, like the other ascendant business interests, emerged largely unscathed from the revolt...
...Butz also had the strong backing of the grain5 Specialization is hardly a new idea...
...The most politically active of the grain companies, Cargill in the early 1960's set up a Public Policy Committee within the company which formulates positions on key issues and works out guidelines for the company representatives who speak out publically...
...client regimes (as in South Korea...
...The Incredible Empire of Michel Fribourg," Business Week, March 11, 1972...
...When a reporter recently called its New York office, the company's legal counsel refused to acknowledge publicly that Gerald L. Dreyfus is the president of the corporation...
...Interview with an aide to a Senate Subcommittee investigating the grain trade...
...diplomatic objectives...
...Current policies mean a continuation of the trend toward concentration, integration and corporate takeovers in farming-precisely the scenario envisioned by the Williams Commission and advocated by Earl Butz.* Only the biggest farmers, with large capital resources, will be able to survive in the "free market...
...To satisfy these capital needs, Cargill maintains credit lines with 30 to 40 banks, including eight of the ten largest U.S...
...In a letter to the secretaries of State, Commerce and Agriculture, Kissinger wrote: The Department of Agriculture in cooperation with other interested agencies should take the lead in developing for the President's consideration a position and a negotiating scenario for handling the issue of grain sales to the USSR...
...This should include a recommendation on how the private transactions of the U.S...
...In the Middle East, food aid has played a somewhat different role, serving as a crucial bargaining chip in Kissinger's efforts to separate Egypt from more radical Arab countries...
...68-72...
...A look at these strategies and their implementation reveals that rising food prices and the accompanying crisis for millions of people throughout the world were largely the result of the efforts of U.S...
...For the Allende government, food imports assumed major importance as right-wing landowners moved to sabotage food production, and the Chilean working class gained purchasing power...
...food exports to Japan doubled.1 4 According to the President's 1975 Economic Report, the NEP was a significant factor in the 39 percent increase in U.S...
...Although he does not openly defend the grain companies, Humphrey moved to control and dilute recent congressional efforts to regulate the grain trade...
...Meanwhile the parent firm, which owns flour mills, chemical and textile plants, and an array of other industrial operations throughout Latin America, is also encountering problems...
...New York Times, May 25, 1975...
...1 As the food crisis highlighted the world's dependence on U.S...
...3 4 As the Ford Administration's current attempts to hold down inflation by suspending sales to the Soviet Union reveal, U.S...
...5. Hubert Humphrey quoted in Cleaver, op...
...political priorities...
...As one White House official observed, "This is the best opportunity we've had in 30 years to fundamentally alter farm programs...
...While the production of agricultural commodities such as sugar and bananas also passed into the hands of the multinational corporations, the lack of economies of scale in grain never favored the emergence of large corporate enterprises...
...It serves as a stick to wield against nations engaged in revolutionary processes (as in Allende's Chile...
...However, $280 million, or 30 percent of the total budget, were held "uncommitted...
...client regimes...
...Cargill official, op...
...And Kissinger himself lobbied to have South Vietnam placed on the U.N.'s M.S.A...
...The Williams report did not gather dust on government shelves...
...Cargill's position as an integral part of U.S...
...agricultural exports are bright, if Japan and Europe continue to increase their consumption of grain-fed meat, and if they can be forced to remove their trade barriers...
...6 To carry out the export drive envisioned in the Williams report, U.S...
...Cargill's Chateau Headquarters near Minneapolis23 For Cargill, PL 480 served as a two pronged instrument in its market expansion...
...aid through the multilateral institutions dominated by the United States...
...Then in the late 1950's, Cargill, through its shipping subsidiary, Cargo Carriers, began to use the inland waterways for transporting grain...
...farms still produced more than commercial markets could absorb...
...3,353 3,185 Netherlands...
...3 s Recent acquisitions have carried Cargill into other areas of the Brazilian economy...
...Cargill enjoys a particularly close relationship with the Chase Manhattan Bank...
...The figures listed in the PL 480 Annual Reports under Title III do not accurately reflect the actual spending level, since the Barter Program had spending authority under the Commodity Credit Corporation Charter in addition to Title III...
...For a description of these "private trade entity loans," see the Cargill article below...
...3 The analysis and policy recommendations of the Williams Commission, as it came to be known, entered into the planning of Nixon's New Economic Policy (NEP...
...According to one knowledgeable Washington source, Cargill was a force behind the nomination of Clarence Palmby to the post of Assistant Secretary for International Affairs and Commodity Programs, the key post for the grain trade in the U.S.D.A...
...PL 480, appropriately named the Agricultural Trade and Development Act of 1954, has been the major vehicle for developing markets for U.S...
...The CIA study projects serious food shortages in coming years and growing world reliance on U.S...
...We can't subordinate our commercial exports to needy people...
...food sold in Chile on the open market did little to alleviate the plight of the Chilean worker, whose purchasing power has been eroded by an inflation rate of 600 percent...
...industrial base and its foreign marketing network...
...Ability to provide relief food in periods of shortage or famine will enhance U.S...
...With no alternative means of moving grain, farmers were sometimes forced to accept price discounts of 10 to 25 and, in some cases, as much as 50 cents on each bushel of grain sold to Cargill...
...economy is correspondingly eroded.* One other factor contributed to the U.S...
...Increasingly, Third World countries are demanding not only control of their resources, but also a basic restructuring of the international economic system that serves the interests of developed capitalist countries, particularly the United States, at the expense of the Third World...
...In comparing Cargill to the public corporations, the company's sales for 1973 ($5.3 billion) were used...
...The company also owns two merchant shipping firms, one based in London and the other in Paris...
...21 No major financial moves are made by Cargill without first consulting with Chase...
...grain trade, the company also manufactures glass, shipboard and particleboard in Argentina and Brazil...
...13 Although the huge jump in U.S...
...Foreign Agricultural Trade Policy, 1973.10 MAJOR MARKETS FOR U.S...
...The State Department instructed its representatives in Korea to see that the "poultry and livestock industries" receive special consideration from the government...
...Under the CCC, a complex of programs were created to support farm income and in effect establish farm prices, and to control farm production...
...In the 1830's William D. Cargill, a Scottish Presbyterian, migrated to the northeastern United States, where he worked as a captain in the merchant marine...
...As of May 31, 1975, Cargill's world-wide annual sales stood at about $9 billion, making it the largest grain trader in the world.** In spite of Cargill's sprawling business empire, its name is not a household word...
...181-199...
...oil needs...
...Food will give us influence because decisions in other nations will depend on what we do...
...Washington Post, September 11, 17 and 18, 1975, and Reuters Wire Service dispatches...
...food aid flowed into Europe as part of the effort to bolster the area against Communism.4 The passage of Public Law 480 in 1954 signalled a new era in U.S...
...Dan Ellerman, National Security Council commercially in their own countries-a procedure which means most food aid does not reach poor and hungry people.* Until 1971, the U.S...
...Japan is the prime example of the success of this government-industry partnership in penetrating foreign markets and transforming people's eating habits...
...But government programs had precisely the opposite effect of stabilizing the market...
...Comparative advantage" was simply another way of describing an international division of labor structured in U.S...
...The two companies move approximately the same volume of grain each year, but Continental is less diversified with only about 15 percent of its annual sales coming from non-merchandising activities...
...Although the company was not the leading exporter to the Soviet Union in 1972, the unloading of the large U.S...
...Although grain exporters received subsidies to allow them to compete in world trade, they were still deprived of the flexibility they needed to play the market and maximize profits...
...A secret document prepared by the Department of Agriculture reportedly admitted to the objective of raising world prices.' Prices within the United States would also inevitably rise as food was diverted to export markets and domestic supplies strained...
...prices above world market prices, making U.S...
...First it asked U.S...
...corporations, Cargill does not sell its shares to the public...
...2 115 Since the coup, U.S...
...In preparation for the Washington Energy Conference held in early 1974, both Kissinger and then-Secretary of the "Hungry men listen only to those who have a piece of bread...
...Cited hereafter as the Williams Report...
...For the American people, the solution to the current food crisis is not to demand an end to grain exports, nor the converse, to argue that the United States should feed the world...
...capitalism for the past century and a half...
...food dominance to buttress U.S...
...efforts to counter growing challenges from the Third World...
...But with specialization comes interdependence...
...The rush by the more affluent countries to buy cheaper food from the United States helped create shortages on the world market which eventually contributed to higher prices...
...in times of short supply, it would allow the United States to meet commercial demand abroad, and yet be able to manage domestic inflation without having to resort to export controls...
...allies in Cambodia and Vietnam, the focus of U.S...
...In 1972, they used this position to their utmost advantage...
...8 The company established feed milling and vegetable processing divisions that moved into domestic manufacturing, and it also built tankers for the Navy and Army...
...strategy at GATT...
...In fact, for the past two years, the Agriculture Department has not even requested any expenditures for PL 480, and the initiative has been taken entirely by the State Department...
...In recent years, the subterminals have assumed a special role in the company's expansion...
...79-85...
...Ibid...
...6. For more on the PL 480 program see Israel Yost, "The Food for Peace Arsenal," NACLA Newsletter, May-June, 1971...
...3. Interview with Washington, D.C...
...In Argentina, the company is a major exporter of wheat and other grains, owns and operates export facilities, produces hybrid seed corn for the domestic market, and owns two large feed mills that manufacture livestock and poultry feeds...
...Counterpart funds have also aided the expansion of U.S...
...government, it by no means restricts the political usefulness of PL 480...
...Secretary of Agriculture, Earl Butz, announced that "Food is a tool...
...In a very real sense it is our extra measure of power...
...See Jim Hightower, "Food, Farmers, Corporations, Earl Butz...
...Although high prices per se are not essential to the grain exporters, who make their profit by adding a margin on to every sale, higher prices were implicit in the Nixon Administration's agricultural strategy...
...Thus, as Congress moves to limit military aid to South Korea, food aid is being called upon to fill an important gap...
...See Kissinger's speeches of May 28, 1975 and October 2, 1975...
...military forces during and after the Korean War...
...The grain trade forms an integral part capitalism...
...government to establish this subsidiary...
...wheat, and their per capital beef consumption has doubled in the past decade...
...grain agriculture the epitome of capitalist efficiency...
...Third World countries, however, reaped few benefits from the devaluation, and, in fact, their ability to import food was adversely affected...
...The success of the oil producing nations in setting their own terms on price and access to oil has led to similar attempts by other commodity producers as well...
...The implications of U.S...
...4 To manipulate the market the companies have developed a sophisticated intelligence network...
...In the Commission's report to the President the following year, agricultural exports were assigned a pivotal role in overcoming the U.S...
...It now appears that the operations of the multinationals abroad are adversely affecting the U.S...
...4 9 Cargill's financial statement for 1973 reveals that the company's net assets increased from $246 million to $352 million, an increase of over 40 percent...
...interests...
...agricultural exports and to take the American way of eating to millions of people around the world...
...agricultural exports reached an all-time high of $21 billion...
...The men who run the enterprise keep a tight lid on its activities, permitting only an occasional article to be written by a trusted business journal or newspaper...
...By moving abroad the multinationals created an increased demand for capital goods as well as other U.S...
...Over the past two years, food has figured prominently in this strategy...
...agricultural policies in the 1970's led to a boom for the grain trade...
...POLICIES TAKE EFFECT By 1973, the U.S...
...One of the questions reportedly addressed by the NSC was the political implications of the dependence of Third World countries on the United States as a supplier of food...
...661 885 Mexico...
...PL 480 enables the corporation to sell grain to the Third World, Eximbank and OPIC loans help Cargill set up foreign subsidiaries, and American military and economic assistance to repressive regimes in Taiwan, South Korea, El Salvador and Guatemala help maintain the environment necessary for Cargill operations...
...The first approach ignores the real needs of other countries, while the latter would make some countries even more dependent on the United States...
...its recommendations are echoed in the recent report on farm policy prepared by the prestigious Committee for Economic Development (with the help of William Pearce as consultant...
...Retired Cargill official, op...
...3 The companies also speculate heavily in international shipping...
...The Big Five and PL 480 Exports of Grains and Vegetable Oils Under Title I, PL 480 (Figures in Thousands of Dollars) 1972-74 1954-67* Cargill 151,363 1,572,968 Cook Industries 143,616 158,249** Continental Grain 140,889 1,626,472 Louis Dreyfus, Inc...
...Although competitive, the grain companies, like many other enterprises under monopoly capitalism, are not at the mercy of the free market...
...In India, the U.S...
...As one Senate aide who has investigated the trade noted, "by controlling the inspectors, the companies control the price mechanism...
...Cargill marketing is like farming - it cultivates things that weren't there before...
...3 6 The growth of nationalism and popular movements in Latin America forces Cargill to rely heavily on its Brazilian base...
...Today, Continental Grain and Cargill together control about 50 percent of the world's international grain trade...
...surpluses and penetrating foreign markets...
...As with Title I, the idea is to introduce these blended foods under the aid program and then shift to commercial sales...
...grain monopoly indicate the National Security Council agreed with the CIA that "food power" can play an important role in bolstering declining U.S...
...754 804 Spain...
...The rise of agricultural exports after the depression of the 1890's along with the continued growth of the national economy, eventually provided the farmers with new markets, thereby alleviating their financial plight and defusing the Populist movement...
...subsidiaries in 31 countries have received Cooley loans-including the Bank of America, Ralston Purina, and Cargill...
...Examples of other large private corporations are the Hearst Corporation, Hills Bros...
...agricultural products, with last year's imports totaling $885 million...
...Food Aid and Why...
...workers to relend to large corporate interests, including the grain companies...
...As one U.S...
...In protest against the Junta's repressive policies, Congress placed a $26 million ceiling on economic aid to Chile for fiscal year 1975 (even with this ceiling U.S...
...In fact, while Continental Grain, Dreyfus, and Cook Industries tied up most of their elevator and shipping capacity in moving grain to the Soviet Union, Cargill later picked up the more lucrative grain sales to other overseas customers - after the world price of grain had soared to unprecedented levels...
...The word "grain" is broadly defined to include wheat, corn, soybeans, oats, and barley as well as other lesser known agricultural seeds...
...In 1945, Cargill noted that among its many creditors, "the most important of these to Cargill is the world's largest bank, the Chase [Manhattan] Bank...
...Some of the countries import large quantities of grain under U.S...
...First, the program enabled the company to directly increase its export sales...
...While the wealthy spend a much lower percentage of their income on food, most working people spend a much higher percentage...
...Legislation passed in 1933 set up the Commodity Credit Corporation(CCC), which, although part of the Agriculture Department, was a government corporation with independent spending authority...
...This will mean, according to the CIA, "an increase in U.S...
...Butz himself commented at the time that the credits had been extended for "national security" reasons.28 *elh_16 CCC credits have been used for political purposes in many other instances...
...According to a Continental Grain officer, the president of the company, Michale Fribourg, "has felt since the late 1950's that it is better to trade with the Communist countries than to fight them...
...s This scheme coincided with the interest of U.S...
...interests in the Third World...
...Cook Industries, Inc...
...With American production unlikely to be affected by this trend, the CIA speculates that "as custodian of the bulk of the world's exportable grain, the U.S...
...and assorted newspaper articles.IV...
...Their foreign operations have become so extensive that subsidiaries trade with subsidiaries without recourse to the U.S...
...The existence of large reserves cushioned the market against abrupt price rises, since there was never a threat of shortages even with a big upswing in demand...
...6f10 851 Italy...
...trade deficit...
...foreign policy...
...The other grain exporters - Canada, Australia, Argentina and France- individually control only small shares of the world market...
...The claim by Administration officials that they were caught unawares by the enormous size of the Soviet purchase is not supported by the evidence...
...At the same time, the Soviets were negotiating privately with the major U.S...
...7 Kissinger's purpose appears to be twofold...
...Although less is known about the operations of many of Cargill's other subsidiaries, the corporation is heavily involved in two South American countries - Brazil and Argentina...
...Among other places, it has offices in Manila, Tokyo, Panama, Buenos Aires, Amsterdam, and London...
...By the turn of the century, Cargill's profits enabled the family to expand into new areas totally unrelated to the grain trade...
...government accepted the local currency generated by the food sales (known as "counterpart funds") as repayment for Title I credits...
...agricultural attaches on the extent of the damage to the Soviet crop, caused by a severe winter and by a later spring drought, were received at the Agriculture Department and stamped classified...
...It invoked the principle of "comparative advantage" to justify increasing the U.S...
...grain, it also buys and exports grain in the other major agricultural producing nations...
...they operate charter companies that control shipping to every part of the world...
...1964 Guatemala Feed plant Acquired Guatemalan firm...
...policy makers, farmers are the necessary cogs in "on-line production factories" producing the commodity that will keep the U.S...
...Instead, we need to focus on the real structural causes of the crisis...
...First, by approaching each commodity separately, he hopes to thwart producer attempts to present a united front...
...and William Robbins, The American Food Scandal (New York: William Morrow, 1974), p. 180...
...in the industrial sector in exchange for concessions to the U.S...
...When the new facilities are completed in 1977, they will be leased to Cargill for thirty years...
...Cargill's first manufacturing investment abroad was in Peru...
...officials, the sale was a crucial element in U.S...
...Not only was there growing resistance to funding the Indochina war, but also to supporting repressive dictatorships around the worldthe "friendly" countries who figured highest on the foreign aid priority list, from the Junta's Chile to Park's South Korea...
...Worried about the growing power of the teamsters and the trucking industry, Cargill, in the 1960's, took the lead in pressuring the Interstate Commerce Commission (ICC) to restructure railway rates and regulations so that rail transportation became more economical for the grain companies.16 First, the regulations were altered so that the companies could take control of entire train units at special rates...
...This budgetary support was often used by recipient governments to underwrite their military budgets...
...In an attempt to coerce the oil rich nations to recycle their petrodollars by financing U.S...
...NACLA West Agribusiness Project NACLA West Agribusiness Project Roger Burbach Patricia FlynnFOOD EXPORTS Bailing Out The Empire INTRODUCTION In 1974, U.S...
...Wall Street Journal, January 16, 1973...
...government, Korea Cargill began experiencing financial difficulties in 1972...
...4 14 The role of the food weapon in U.S...
...New York Times, November 3, 1974...
...surpluses in times of overproduction, thus maintaining prices...
...and in scores of countries they own port facilities and processing plants...
...In the aftermath of dire predictions of mass starvation made at the 1974 Rome Food Conference, and in the glare of international publicity focused on the U.S...
...Facing the Blockade," op...
...Cargill received 95 percent of its financing from the U.S...
...About two-thirds of this income derives from the grain trade...
...food credits that year...
...balance of trade...
...Then in the mid-1930's, Cargill moved abruptly into the Chicago Market...
...power that would result from the cooling of the world's climate which is predicted by some climatologists...
...Nevertheless, company executives denied that Chase "calls the shots" or has the ultimate say in Cargill's business decisions...
...The companies oppose all forms of export controls and some of them are lobbying against international grain reserves...
...diplomacy...
...See also "Christian Missions for the Empire," NACLA's Latin America and Empire Report, December 1973...
...While the commercial houses focused their international activities on the buying and selling of commodities, the multinationals gained direct control of mining and manufacturing facilities...
...And the world's dependence on North American agriculture will continue to increase...
...As one company representative noted, "the grain companies can adjust much quicker than a farming community" to changing market conditions...
...Not even Cargill, the "Cadillac of the grain trade," possesses anywhere near the amount of capital needed to finance these seasonal grain inventories...
...agricultural commodities...
...As popular opposition to the Vietnam War grew and made itself felt in Congress, it became increasingly difficult for the Administration to obtain funds from Congress for economic and military aid...
...The companies run an integrated merchandising structure extending from the farmer's fields to foreign markets...
...The company also expanded into related areas of international agribusiness...
...strategy led to an immediate increase in exports, the resurgence of agricultural production in Western Europe at the end of the 1940's lessened the demand for U.S...
...Return on net assets means the return on invested capital, not the annual increase in profits from year to year...
...trade deficit through food exports meant increasing both prices and volume...
...They're a way of life...
...policy has aimed first of all, at undermining the OPEC cartel...
...trade balance, there is strong evidence that the movement of U.S...
...3. The History of Cargill, Incorporated...
...One source noted that "Cargill was closer to Richard Nixon than it has been to any President...
...see also Robbins, op...
...2 3 The Nixon Administration was determined that this pattern not be repeated, and agriculture became a central factor in the U.S...
...According to one Agriculture Department official, "word came down" from the State Department to extend the Chile credits, in spite of the fact that the program had been suspended for several months because of the tight food supply situation...
...2 Chairing the Commission was Albert L. Williams, head of IBM's Finance Committee, and working with him were other representatives of the corporate elite, the academic community, and two labor leaders...
...PL 480 provided a perfect cloak for U.S...
...then, when the opportunity arose, the partners would be bought out, since the Cargills preferred complete ownership...
...Highly favorable soil and weather conditions, combined with intensive application of technology and capital, make U.S...
...agricultural commodities to be processed in their plants...
...The railway owners and 'the grain elevator operators, such as Cargill, sometimes conspired to fix grain prices...
...One loan for $500,000 came from PL 480 under the special provisions of the Cooley amendment...
...One fb Secretary of Agriculture declared: "The p bureaucratic influence of the grain compare pervasive...
...power and influence especially vis-a-vis the food deficit poor countries...
...According to one company official, "Cargill wants to spread the risk base and the profit base...
...As mentioned earlier, a key element in negotiating the 1972 Soviet grain deal and solidifying Detente was the $750 million credit extended to the Soviet Union...
...7 The key officials serving under Butz at the Agriculture Department were even more directly tied to the trade...
...The last round of negotiations, known as the Kennedy Round, took place between 1963 and 1967.9 MARKET DEVELOPMENT Bread & Butter Imperialism The recent boom in U.S...
...The Commission was also explicit about where Third World countries fit into its strategy: they should rely on their comparative advantage in producing labor intensive crops, such as fruits, vegetables and sugar, for export, thereby earning the money to import U.S...
...Senate, Committee on Agriculture and Forestry, Hearings, Agriculture and Anti-Depression Act of 1975, February 1975 (Washington, D.C.: G.P.O., 1975), p. 1059...
...While the companies of European origin built elevators, terminals, and other marketing facilities in the United States similar to Cargill's, the native grain giant cornered a large share of the European market...
...As Cargill itself boasts, "Few facets of modern life are unaffected or unreached by Cargill today...
...This amendment allowed multinational corporations to CARGILL'S FOREIGN FOOD PROCESSING SUBSIDIARIES Date Founded or Purchased Country Operations Comments 1963 Peru Fishmeal plant Purchased from Peruvians...
...interests in the Third World...
...3 I.4 Mark Podwal goods...
...518 410 USSR...
...grain exports involved government concessional financing of one type or another.* CARGILL'S DOMESTIC STRUCTURE "The Reign It's Plain is Mainly in the Grain" (from a Cargill pamphlet) By the 1950's, Cargill had expanded and consolidated its control over a huge network of merchandising, storage, and transportation facilities...
...are hired by the grain trade...
...the value of the dollar had plummeted as Washington refused to redeem foreign-held dollars for gold...
...exports to penetrate the major commercial markets of Japan and Europe...
...Resins Rock salt Hybrid seeds Protein meals and oils Soy protein specialty foods Sugar, molasses Poultry breeding stock Animal feeds Fertilizer Metals, ores, steel Electronic components Plastics ES PRODUCTION/PROCESSING Crop seeds Dry and liquid animal feeds Resins, protective coatings Rock salt and evaporated salt Poultry-breeding stock, eggs, broilers, turkeys Soy specialty foods-flour, grits, textured protein Corn starches and syrups Grain sampling equipment Vegetable oils-soybean, sunflower, linseed, cottonseed, coconut Lecithin Flour, baking mixes Steel Barges SERVICES World shipping Great Lakes shipping Inland waterway shipping Warehousing and distribution of commodities Grain handling, storage, drying Plant breeding Stevedoring Technical research Leasing Commodity brokerage Insurance Steel fabricating29 as the private bailiwicks of Cargill and the grain trade...
...Cargill official, as reported by New York Times, March 11, 1974 and interview with president of the National Grain and Feed Association...
...But in the 1960's this pattern began to change, as the subsidiaries abroad began to turn out a wide array of industrial products (some for export to the United States), and even began to manufacture capital goods...
...For example, in South Korea (the second largest recipient of PL 480 credits), 85 percent of food aid proceeds were used for this purpose...
...2 0 Although the magnitude of the sale may have exceeded the early expectations of U.S...
...I associations, such as the National Grain Trade the National Grain and Feed Association Washington on behalf of the grain trade...
...Rooted in the nineteenth century, they are actually similar to the British merchant firms, or commercial houses, which bought and traded agricultural products as well as manufactured goods and raw materials...
...Pre-1971 Thailand Feed mill Insured by OPIC Guarantee for $600,000...
...Overall, Cargill is an astute strategist at using State and private funds to sustain its commercial empire...
...3 4 Kissinger carried this theme further when, at the Rome Food Conference, he tried to blame oil-induced inflation for "shattering the ability of developing countries to purchase food, fertilizer and other goods...
...The current president of the First National Bank, George H. Dixon, also serves as a director of the Cargill Foundation...
...This in turn eliminated a key provision in the licensing requirement that 50 percent of exports be shipped on U.S...
...agricultural products...
...grain-processing industry...
...This account of U.S...
...3 7 In addition, Cargill directly manipulates many State organizations by placing its people in key government agencies, and by having a close relationship with the men and women who wield political power...
...farmers would be unable to offset the cost of machinery, fertilizers, and other capital inputs, which account for 70 percent of U.S...
...Realizing that prosperous export markets could only develop if the major economies of the world were rebuilt, the United States used first the United Nations Relief and Rehabilitation Administration (UNRRA) and then the Marshall Plan to send unprecedented quantities of grain to the European and Asian nations...
...As Nixon's international economic advisor commented, "Farmers must become a main force in the political drive in the U.S...
...They use their enormous size to manipulate the marketplace and to maximize profits at the expense of farmer and consumer alike...
...In 1865, the oldest son, Will, went to Iowa where he bought an interest in country grain elevators along the new railway lines...
...2 0 * Food clearly played a role in the U.S...
...As observed by an official of the Agency for International Development: AID has cooperated with the government of Colombia in carrying out a development strategy that encourages a switch from wheat production into crops other than wheat, which can be produced more economically...
...As one company official noted, "Tradax and Cargill are mirror images...
...The Commission devoted a major section of its report to laying out a strategy for expanding U.S...
...strategists, there was clear evidence in the months preceding the sale that Soviet needs would indeed be tremendous...
...Food donations under Title II have also been used as an effective instrument to create markets for the U.S...
...grain exporters from being competitive in the European market...
...foreign policy...
...New York Times, July 24, 1974 and November 23, 1974...
...Economic integration under capitalism is also having detrimental effects on U.S...
...capitalists to maintain U.S...
...foreign policy interests...
...NACLA'S LATIN AMERICA & EMPIRE REPORT Vol...
...In 1973, in spite of the fact that the commercial surpluses the program was designed to dispose of no longer existed, barter sales reached an all-time high of $1.1 billion, four times the average level of spending in the 1960s.' 6 In 1974, Congress attempted to throw another wrench in Kissinger's plans to manipulate PL 480 for political purposes...
...FOREIGN MARKETING ACTIVITIES "THE SUN NEVER SETS ON CARGILL'S CORN" (In-house Cargill slogan) Since its first trading offices were established in Europe in 1929, Cargill's international operations have penetrated into every corner of the globe...
...farm policy toward more of a market orientation, a decisive shift could not be made until the U.S...
...Judy Carnoy and Louise Levison, "The Humanitarians" in Weissman, op...
...When Cargill began selling grain directly to feed millers in West Germany, that country's merchants initiated a boycott against Cargill which lasted for almost eight years before it finally collapsed...
...According to one informed source, the company or its officers "have given money to Humphrey for every campaign since he ran for mayor of Minneapolis...
...By 1970, the deficit in this area stood at $3.4 billion...
...subsidiary has sales of $2 billion...
...Frundt, op...
...3 8 Both of Minnesota's Senators, Hubert Humphrey and Walter Mondale, have ties with Cargill...
...Richard Bell, Assistant Secretary of Agriculture Although the Farm Bill of 1970 had moved U.S...
...Senate investigator "there is sentiment within the grain community that Canada may go off the Wheat Board...
...corporations abroad has undermined the U.S...
...We can't subordinate our commercial exports to needy people...
...Dan Ellerman, the National Security Council representative on the Inter-agency Staff Committee that oversees PL 480, made this remark at a secret Committee meeting...
...When new agricultural crops or techniques were introduced, they were used to grow commercial crops for export rather than to increase the food supply of the indigenous peoples...
...Interview with official in the Export Operations Division of the Agriculture Department...
...High profits in recent years have enabled the company to acquire a number of non-agribusiness firms, leading some to label Cargill a "mini-conglomerate...
...strategy of maintaining a low-profile, non-official presence in Chile...
...Aside from engaging in the soybean export trade, Cargill built one of the world's most modern soybean processing facilities in Ponta Grossa, Brazil...
...The Administration's Farm Bill, passed by Congress in 1973, ended government programs to withhold * In 1968, U.S...
...SOVIET WHEAT DEAL The major boom in U.S...
...9. Cited by Frundt, ibid...
...2 6 These credits came under the CCC's Export Credit Sales program, another of the CCC's programs with virtually unlimited spending authority, passed out at the discretion of Administration officials...
...As a newcomer, Cargill's market initiatives met with resistance...
...Since World War II, the development of new transportation techniques has enabled the company to stay one jump ahead of its competitors and to extract the maximum profit from every bushel of grain it handles...
...In 1969, Cook took control of a large plywood firm, thus giving the company an industrial base...
...cit., p. 205...
...Los Angeles Times, September 22, 1974...
...At about the same time, Nixon brought William Pearce of Cargill to the White House as special deputy trade representative, indicating the Administration's decision that grain export interests would be well represented at the negotiations...
...Quoted in Anderson, op...
...strategists are aware that manipulation of the farmer is essential to the success of their export drive...
...As the chairman of one of the major grain corporations put it: The opening of trade with China and Russia is the greatest thing of the century...
...It is a bargaining lever to extract concessions from countries less amenable to U.S...
...The grain itself is often transferred on paper from country to country...
...As a result of these support programs, the CCC accumulated huge stocks of grain reserves...
...grain sales should be related to Government actions including the U.S...
...Determined to gain access to the large Brazilian market, Cargill sent a new representative to Brazil in 1959 who succeeded in breaking into the export-import trade...
...a measure of power it never had before - possibly an economic and political dominance greater than that of the immediate post-World War II years...
...The food program became know euphemistically as "Food for Peace," and a White House Food for Peace office was established...
...Several sources suggest that Captain Cargill's quest for profits led him into the slave trade...
...The Two-Billion-Dollar Company That Lives by the Cent," Fortune, December, 1965, p. 168...
...The expansion of agricultural exports is the cornerstone of Washington's efforts to overcome the U.S...
...Without the crutch of government support payments, U.S...
...balance of payments position, to deplete U.S...
...New York Times, January 28, 1975...
...credit to finance Soviet grain purchases...
...Although involved in Argentina since 1929, Cargill's Brazilian operations are of much more recent origin...
...Los Angeles Times, September 11, 1974...
...Once again, timely backing from the U.S...
...Ibid...
...44 Sometimes personnel go from the grain companies to work for the Department of Agriculture, while in other instances people who leave the U.S.D.A...
...9. Congressional Record, June 25, 1973, p. S11905...
...Japan has developed an advantage in many fields, including electronics and photographic equipment...
...Added to the economic threat of OPEC and other cartels is the political threat Third World unity poses to the United States...
...corporations which use their control over crucial items like grain and capital goods to maximize profits, while less developed countries are forced to offer their mineral and agricultural wealth, as well as their labor, at less than favorable prices.6 companies, which had consulted closely with Nixon on the appointment...
...This Report focuses on how the U.S...
...Instead of the 80 percent limitation written into the legislation, the two countries were allowed to use 100 percent of the sales proceeds to underwrite their military budgets as grants from the U.S...
...The groundwork for the large sale of the following year was carefully planned by the Administration...
...Each company buys and sells contracts for shipping space, never intending to use all of the space, but rather to keep its options open and to maximize profits...
...The company is a stunning example of modern corporate capitalism, where small amounts of capital are used to control vast financial and commercial empires...
...vessels, whose rates were far above world prices...
...In the early years of Cargill, just as today, financial backing played a crucial role in the company's growth...
...But a similar provision of PL 480 extends dollar loans to foreign subsidiaries...
...You're either going to pay or not do business...
...Foreign Agricultural Trade Policy, March and April 1973 (Washington, D.C.: G.P.O., 1973), p. 160...
...balance of payments, and finally, to help meet U.S...
...Capital needs in the 1960's forced the company to go public, and today the Cook family owns 39 percent of the stock...
...Exploiting people's most fundamental needs and making enormous profits in the process, firms like Cargill vividly illustrate the basic injustices of capitalism...
...Its operations grew rapidly, especially after the installation of the military regime...
...Secondly, Cargill (and other grain companies) used PL 480 to "whet the appetites" of many countries...
...This large increase occurred just as Congress moved to reduce the Ford Administration's military aid request for South Korea, and proposed to phase out military aid to that country over a three year period...
...In 1932, Cargill assumed control of the new grain export elevator at Albany, New York, at the time the largest facility of its kind in the world...
...2 3 * As studies of the political role of relief agencies have pointed out, they often act as "the quiet arm of American diplomacy, living in the shadow between official policy and private charity...
...cit., revised edition, 1975...
...Once they had opened up the market in a given country with PL 480 concessional sales, it was much easier for them to follow up with direct commercial sales...
...The company headquarters reinforce the air of secrecy...
...The Williams Commission also recognized that "an integrated world economy [where] the multinational'firm makes its decisions in global terms" is the main characteristic of the contemporary capitalist system...
...Food Power...
...30 The chief construction and engineering manager, Myung Cho Chang, worked for the U.S...
...channeled food aid to Chiang Kai-shek's forces in China through the United Nations Relief and Rehabilitation Administration...
...And finally, the imperatives of capitalist agriculture within the United States required higher prices...
...Based in New York, Continental Grain, more than any other grain company, projects a "cool, corporate, Wall Street image...
...The U.S...
...These merchant firms were eclipsed by the rise of the multinational corporations...
...had subsidy programs, it could not effectively demand that its trading partners remove theirs...
...1 9 For Cargill and the other grain companies, three Chicago based banks - the Continental Bank of Illinois, the First National Bank of Chicago and the Harris Savings & Trust - play an important role in financing grain inventories...
...Cargill official, op...
...8 Kissinger has suggested that the international grain reserve proposed by the United States serve as a model for other commodity arrangements, and he has also tried to make the proposal appear as a concession that Third World countries should reciprocate...
...4 0 Although less directly tied to the grain companies, Senator Mondale "toes the line with Cargill...
...The CCC has also turned off the credit spigot...
...representative of the Bunge Corporation...
...Ibid...
...Cargill's closest link is with the First National Bank of Minneapolis, which served on the Creditors Committee in 1909 when Cargill entered into receivership...
...Mondale read public statements by Cargill into the Congressional Record as recently as 1972, and he has received campaign contributions from Cargill...
...Marketing information is crucial in the transaction...
...New York Times, November 6, 1974...
...Interview with a retired Cargill official...
...The companies manipulate every possible market mechanism - the more the better...
...Clarence Palmby, the assistant secretary for International Affairs in charge of export programs, had formerly worked for the U.S...
...And in a very real sense it's our extra measure of power...
...Thanks to U.S...
...To me that was good news, because before people can do anything they have got to eat...
...1971 Taiwan Feed mill Partnership with local company...
...Cargill failed on two earlier occasions to gain a foothold in Brazil - one in 1947, and then again in the 1950's...
...The main U.S...
...2 2 Thus the outlines of mutual interest are clear: the Soviet government is relying on the United States for food and technology, and the U.S...
...Their control of the means of production enabled them to bypass the merchant houses and set up their own marketing networks...
...Its blueprint for agricultural policy is repeated in reports and documents of the Agriculture Department...
...Their manipulation of the CCC reserves was dramatized in 1966 when the large grain interests bought most of the government corn reserves in anticipation of shortages and rising prices...
...And then he added: It would be tempting for the United States, beset by inflation and soaring energy rices, to turn a deaf ear to external appeals for food assistance.t The failure of these attempts to undercut Third World militancy have led to a subtle shift away from aggressive confrontation...
...The New Economic Policy and Agricultural Trade," Foreign Agriculture, September 27, 1971...
...Dan Balz, "Agriculture Report/Food for Peace Program Comes Under Congressional Scrutiny," National Journal Reports, June 7, 1975...
...For the Commission, this meant phasing out U.S...
...8 Although no one benefitted more than the grain companies from CCC programs - they made billions of dollars of export sales with CCC financing and received enormous payments for storing the CCC's reserves in their warehouses - they were the chief proponents of free trade and ending government programs that interfered with the "free market...
...They still are generally family farmers, not yet overtaken by the corporations that either control or contract production in many other sectors, such as poultry and vegetable farming...
...The U.S...
...The main target of the Flanigan strategy (which has become the basis of the U.S...
...helped install...
...client regimes in Indochina has made South Korea more important than ever in holding the line against further losses in Asia...
...only in its manipulation of the market, but also to use the State for its own interests...
...The concept of nations working together for the mutual benefit of all isn't new either...
...4. Harry Cleaver, "Will the Green Revolution Turn Red...
...These indicators, combined with the knowledge that the Soviet government was strongly committed to a five-year plan of increasing its livestock herd (fed primarily on grain) by 25 percent, presented unmistakable evidence of the extent of Soviet import needs...
...The food weapon is likely to play a key role in these efforts...
...The Cargills ran the enterprise alone until 1909, when the MacMillans were brought in to rescue it from the brink of bankruptcy...
...With the program now defunct, the Agriculture Department claims that records about how the money was used are unavailable, but officials admitted that AID used the program extensively to procure supplies for its operations in Vietnam.is The budget for the barter program increased dramatically in the early 1970s, just as U.S...
...3 0 Caught in this system, and at the mercy of the free market, the grain farmer is forced to see export markets as the only solution to maintaining his income and covering his costs of production...
...2. Ibid., See also Business Week, March 11, 1972, p. 85...
...When the Cargill properties were placed in receivership, John MacMillan persuaded the Creditors Company to allow him to assume management of the ailing company.* From that time onward, the MacMillans joined with the Cargills to forge the destiny of the Midwestern grain company...
...3 9 In fact, the reserve proposal contains no concessions to the Third World, and is primarily a model for serving the United States' own self interest: it is intended to provide an outlet for U.S...
...and Emma Rothschild, "The Politics of Food," New York Review of Books, May 16, 1974...
...Just weeks after the coup, the Agriculture Department's Commodity Credit Corporation extended a $26 million credit to Chile for the purchase of wheat, and several weeks later another $28 million dollar credit for the purchase of corn was announced...
...Samuel Sabin, quoted in Richard S. Frank, "Trade Report," National Journal Reports, October 20, 1973...
...Ibid., p. 15...
...Union for Radical Political Economics, "Is Food Inflation Painless...
...Competition from subsidized European grain exports contributed to the decline in the U.S...
...Today it is involved in banking, real estate and shipping as well as commodities trading...
...marketing and transportation system gave it far more control over the basic export commodity, grain, and enabled it to move strongly into European markets after World War II...
...March 15, 1973...
...opening a CCC credit line and a Soviet commitment to draw on it.'8 Over the next several months, Earl Butz and other officials negotiated with the Soviets on the terms of a proposed U.S...
...From 1958 to 1968, for example, Cargill received over $76 million for storing grain.14 Purchases were made from the CCC reserves whenever the companies wanted grain to cover their own marketing needs...
...government...
...During his tenure as assistant Secretary of Agriculture during the Eisenhower Administration, Butz had been an outspoken advocate of free trade, a free market and big business agriculture...
...For Cargill, like many multinational corporations, the heavy hand of a military regime helps insure continued profits...
...Whereas 20 years ago Western-style bread was unknown in South Korea, today there are 7,000 bakeries...
...1964 West Germany Feed plant Part of the Hens companies acquired in 1964...
...In 1966 Cargill built another soybean processing plant in the Netherlands, and in 1970 opened a third such plant in France...
...China Trade...
...These files include private correspondence and data submitted by companies such as Cargill...
...ad in a farm journal (Feedstuffs, Oct...
...Tradax performs the same merchandising functions abroad that Cargill carries out in the United States...
...agribusiness corporations (especially from Archer-Daniels-Midland, a major soybean trader and processor) for distribution by relief agencies...
...CORPORATE ORIGINS Cargill's history reflects many of the forces that have shaped U.S...
...Although a relative newcomer as a multinational industrial corporation, Cargill has rapidly extended its feed and food processing operations into many Third World markets...
...Coffee, and the Bechtel Corporation...
...For fiscal year 1975, the Administration was again budgeting half of PL 480 credits for South Vietnam and Cambodia...
...A private selling mechanism now exists for feed grains, and some grains are already marketed internationally by the companies...
...Few people were fully aware of the political dimensions of food aid, and it was in any case difficult to oppose a program ostensibly aimed at getting food to needy people...
...In many instances the companies discounted 10 to 25 cents per bushel from the market price they paid the farm coops and the locally controlled elevators for their grain.17 The lack of shipping alternatives meant that the local merchants and farmers had no choice but to sell at the price the grain company dictated.24 FINANCING CARGILL'S EMPIRE Banks and financial institutions play an especially important role in Cargill's sprawling commercial empire...
...foreign agricultural policy, see Henry John Frundt, American Agribusiness and U.S...
...share in world wheat trade dropped by 6 percent and in feedgrains the decline was 10 percent...
...imported more than it exported, registering the first trade deficit of the century...
...Cargill issued a countersuit and demanded that the federal government "clean-up" the Chicago Board of Trade...
...wheat exports tripled and corn exports increased by about 20 percent...
...volumes of grain in relatively short periods of time, the subterminal elevators are used by Cargill to bypass the country's elevators that are often under the control of local cooperatives...
...Figures obtained by NACLA from the State Department...
...4 3 As Nixon's first formal press conference since the California debacle, it proved to be a success and encouraged many people to take a second look at him...
...THE CCC Another little-known device in the U.S...
...At the same time, we must rely on other nations for petroleum, manganese, copper and many other natural resources...
...Although the grain company executives are generally doctrinaire defenders of the free enterprise system, the quest for new agricultural markets in the Soviet Union and China led many of them to favor a relaxation of East-West tensions at an early date...
...A contemporary factor which has contributed greatly to the food crisis is the growing integration of the world's capitalist economies...
...in Japan...
...policy-makers is the new drive by Third World commodity producers to assert control over their natural resources...
...In 1972, Peter Flanigan, head of Nixon's Council on International Economic Policy, requested that the Agricultural Department develop a strategy for the upcoming negotiations...
...Interview with vice president of Continental Grain...
...As long as the U.S...
...concluded the first large deal with the Soviets...
...Ibid...
...8. The History of Cargill, op...
...Many employees of the feed plant are veterans of the Korean War, and almost all of them have had military training...
...3 3 Cargill itself went to the highest levels of the Korean government to seek concessions...
...Because of the growing internationalization of capitalist production, the multinational corporations no longer rely as heavily on the purchasing power of U.S...
...Second-class postage paid at New York, NY...
...When Cargill erects grain elevators, storage bins, or any other type of fixed asset, it often turns to insurance companies for long term loans...
...Cargill Today, op...
...But even more important, the funding mechanism for PL 480 gave Kissinger just the flexibility he wanted...
...And today, improved transportation, communications and trade liberalization have made specialization possible to a greater degree than ever before...
...strategy of laying the groundwork for a coup by undermining the Chilean economy...
...5 1 Since 1970, Cargill has purchased Summit National Holding Company, an insurance firm, AENCO Inc., a solid waste processing center, C. Tennant & Sons, a large international metals trading firm, and the North Star Steel Company, a manufacturer of steel sheet rolls...
...443 454 Republic of China...
...CAPITALISM'S CRISIS By 1970 the outlines of the U.S...
...Figures on the Barter Program were made available at the Agriculture Department...
...They run offices in every corner of the globe, and their system of gathering information is so extensive that even the CIA turns to them...
...capitalism-problems that lead to the progressive weakening of the system...
...KISSINGER'S FOOD DIPLOMACY In the early 1970s, food aid assumed a new significance in U.S...
...The emergent corporate interests in the United States never forgot the lessons of this period: farmer discontent against big business could be contained only by constantly expanding market outlets...
...Earl Butz, Secretary of Agriculture August, 1974 The C.I.A...
...Immediately after the OPEC embargo, the Administration focused its attention on the problem of oil prices...
...7. "Cargill Reaps New Harvest," Business Week, April 16, 1949...
...7. Cooley loans are listed in an Agency for International Development document prepared by the Office of Financial Management, Status of Loan Agreements As of December31, 1974 (#W-224...
...grain companies export to Japan, the huge Japanese trading companies control much of the internal movement of grain, and two Japanese firms, Mitsui and Mitsubishi, are even active in the U.S...
...In 1973, for example, the Duluth Port Authority and Cargill announced a $15 million project for constructing new port facilities...
...To prevent such future occurrences, the company's headquarters were recently moved to Brazil, where they hope the military regime will give them adequate protection...
...efforts to prop up the Junta with aid, see "The United States: Propping Up the Junta," NACLA's Latin America and Empire Report, October 1974...
...cit., p. 99...
...See Elizabeth Farnsworth, Richard Feinberg, Eric Leenson, "Facing the Blockade," in New Chile, NACLA, 1973...
...formulas...
...In 1973, its fishmeal plant in Peru was expropriated, and in Argentina, the increasing radicalization of the country has caused Cargill to curtail its activities...
...food supplies, and assist the Soviets in further oil exploration...
...But by the end of the year, the Administration had taken advantage of the new availability of grain originally allocated to Indochina and the overall increase in the PL 480 budget to raise Chile's share of food aid to $65.2 million ($61 million in Title I and $4.2 million in Title II).24 The U.S...
...The first article shows that the U.S...
...See also Don Mitchell, The Politics of Food, James Lorimer & Co., Toronto, 1975, pp...
...The stuff they get is probably shit...
...corporations to import U.S...
...Even where these foods might be more cheaply produced locally, U.S...
...4 Another major cause of the U.S...
...A former president of General Mills summed up the attitude of Minnesota agribusiness interests toward Hubert Humphrey: "It's a lot cheaper to give Humphrey a few thousand dollars than to fund the Republican Party...
...and finally, at preventing the formation of a united front of underdeveloped nations by driving a wedge between OPEC and other Third World countries...
...Ibid...
...While economic aid requests for Chile come to only $23 million (the third highest in Latin America), the Administration has allocated $55 million under Title I for the Junta - 84 percent of the Latin American total...
...Cargill markets grain...
...government operations abroad (ranging from U.S...
...as one of "structural corruption...
...1,537 1,448 Canada...
...If Cargill were placed on the list of the 500 leading public industrial corporations, it would rank about 16th, ahead of such well known giants as RCA, General Foods, and Dow Chemical...
...exports in 1972 was partly due to a decline in world grain production and the large Soviet purchases, devaluation greatly stimulated demand for U.S...
...It called agriculture "the strongest weapon in the U.S...
...negotiating position at GATT) is the Common Agricultural Policy (CAP) of the Common Market countries...
...dictates (as in Egypt...
...As the report stated, "many of the economic problems we face today grow out of the overseas responsibilities the United States has assumed as the major power of the non-Communist world...
...The Commission argued that in the interest of the rational use of the world's resources, other countries should remove barriers to agricultural trade and end domestic policies that subsidize "inefficient" farmers...
...Thus, it was no surprise that every major move made by the Administration in agriculture coincided with the interests of the grain companies...
...See also Federal Trade Commission, Agn'cultural Income Inquiry, submitted to Congress, March 2, 1937, Part I, pp...
...Cook handles between 10 and 18 percent of U.S...
...2 7 Some of the companies bribe local government officials to gain marketing concessions...
...sponsored school lunch program, commercial purchases of blended foods by the Brazilian government now provide U.S...
...Interview with official in the Agriculture Department's Food for Peace office...
...The promise of food aid which Kissinger made to Egypt in late 1974 was one reason he fought so hard against Congress' effort to limit political food aid to 30 percent of the total...
...economic crisis were clear...
...government aided Cargill's expansion...
...The reasoning was that the more poor nations felt the fuel and price squeeze, the more likely they would be to turn on OPEC...
...Interview with the president of the National Grain and Feed Association...
...nology manufactured products (such as capital goods), and in agricultural commodities...
...In 1974, a Cargill representative, S. D. Ward, Jr., in a letter to the Departmelst of Agriculture, summarized the problems the company and other multinationals faced in South Korea...
...strategists do not see humanitarian food aid as something that will serve U.S...
...Even before the Soviet sales, the impact of devaluation was apparent: in the two quarters following devaluation, the quantity of U.S...
...Based in Minneapolis, the company projects an "American as apple pie" image...
...For more on U.S...
...Aside from Cargill's special ties with Chase, company executives also sit on the boards of banks in the Minneapolis area...
...Not only is Cargill involved in exporting U.S...
...The maximization of profits, the manipulation of the State, the insatiable thirst for foreign markets, and the exploitation of people's fundamental needs - these are all characteristics of capitalism which the grain companies embody...
...Seung Man Park, Cargill's local partner and the president of Korea Cargill, "was a supplier to U.S...
...By 1960 Cargill had become a major international distributor of Peruvian fishmeal - a high-protein meal used for animal feed - and in 1963 the company purchased a large fish meal plant in Peru, as well as a fishing fleet to supply it...
...The federal government, through the CCC, nominally controlled these surpluses since it purchased the excess agricultural production each year to keep farm prices from falling...
...Thanks to the stimulation of production caused by the war, Cargill and many other U.S...
...feed grains mixed on computerized U.S...
...Port facilities are frequently financed and constructed by urban port authorities which then lease them to the grain companies...
...I know that was not supposed to be good news...
...In 1965, Cargill Agricola was established, and by the early 1970's it was engaged in hybrid seed production, feed manufacturing, and poultry farming, as well as grain merchandising.3 Cargill figures prominently in Brazil's emergence in the early 1970's as one of the world's largest soybean producers...
...1. Earl Butz quoted in Time, November 11, 1974...
...cit., p. 7. 5. Ibid., p. 152...
...Cook broke into the grain business by using the commercial network of the cotton trade, and by "pirating" five seasoned executives away from Cargill...
...Oilseeds-soybeans, flax, sunflower, safflower, copra, rapeseed, ground nuts, etc...
...As part of the economic blockade orchestrated by Kissinger against the Allende government, food credits to Chile under PL 480's Title I were suspended...
...It is a weapon in the U.S...
...Most accounts of the sale have focused on the way the grain companies manipulated the sales to obtain maximum subsidy payments (with the cooperation of Department of Agriculture officials), and on how the Soviets managed to buy U.S...
...And if you are looking for a way to get people to lean on you and to be dependent on you, in terms of their cooperation with you, it seems to me that food dependence would be terrific.s By the early 1960s, PL 480 had been fully incorporated into the arsenal of U.S...
...With sales in commercial markets booming and government reserves exhausted, the Agriculture Department no longer needs PL 480 to dispose of surpluses...
...trade position...
...Then, in 1968, Cargill carried the process one step further when it initiated the concept of Rent-A-Train (RAT) - Cargill rented the engine, the train crews, and the railroad right-of-way for extended periods of time.* Through these changes, Cargill and the other major grain companies gained control of much of the country's grain carrying capacity...
...The decline in new investments over the past year certainly leads one to suspect that many prospective investors have a similar view...
...famine-stricken Bangladesh received a mere $41 million...
...there's a free market, but freedom exists only for the few and not for the many...
...Rather than establish mechanisms that would stabilize food prices and help provide an adequate diet for people around the world, the companies prefer free swinging markets that maximize profits...
...2 As one representative of the grain trade said in an interview, "the NEP was very important in giving U.S...
...General Assembly, issued an unmistakable warning to Third World commodity producers that the United States would withhold food to retaliate against cartels: The attempt by any nation to use one commodity for political purposes will inevitably tempt other countries to use their commodities for their own purposes...
...The $61 million credit eased its balance of payments difficulties and freed dollars for the import of other items, such as weapons...
...The U.S...
...Due to the exhaustion of Cargill's PL 480 credits for importing grain, and the Korean government's restrictions on the use of its limited foreign exchange, it became difficult for Korea Cargill to import the feed grains and poultry breeding stock necessary to sustain its operations...
...Another little known provision of PL 480, the Title III barter program, was used to channel support to the Vietnam war effort...
...The fact that it takes 21 pounds of grain protein to produce 1 pound of beef protein fits right in with the Agriculture Department's objective of expanding the demand for surplus U.S...
...4 7 William Pearce of Cargill worked on expanding trade with the Soviet Union from his post in the White House as Deputy Special Trade representative...
...By bribing inspection officials to raise the grade or alter the classification of grain, the companies in effect increase their earnings by millions of dollars...
...Three of the country's major feed mills are owned by U.S...
...Cargill did not put up any of the money: $13.5 million came from revenue bonds backed by the Port Authority, while the remainder flowed from special federal and state programs...
...Many other investors feel as I, that inwardly Korea appears not to want foreigners...
...They rallied around the Chicago Board of Trade to curtail Cargill's expansion...
...Although, as the Commission acknowledged, conclusive statistics are not available to assess the impact of the multinational corpora- tion on the U.S...
...349-51...
...officials were already discussing the possibility of a CCC credit to finance Soviet grain purchases...
...According to the Agriculture Department, half the remaining 2.3 million farms should not even be considered farms, since they have sales of less than $5,000 and account for only 5 percent of all cash receipts in farming...
...As one African official noted, "Thieu and Lon Nol receive millions of dollars...
...empire abroad...
...in 1972, his ties with the grain trade were made official - he became a Vice President of Continental Grain Company...
...This is precisely what Cargill and the other grain companies want in order to maximize their profits...
...government in 1954 forged the perfect instrument for their continued expansion-Public Law 480.* * See part I above for a more extensive discussion of PL 480...
...Memphis-based Cook Industries is a newcomer to the grain trade...
...agricultural exports were $5 billion...
...The companies have strong links wit financial institutions ranging from commercial banks to insurance companies and investment banks...
...A leading proponent of detente with the Soviet Union, Fribourg has entertained Soviet officials on yacht cruises since 1961, and his company has sold more grain to the Soviet Union than any other company...
...Sources: Cook Industries, Inc., 1974 Annual Report...
...empire and to aid the international expansion of the corporations...
...Williams Report, op...
...Sales Soar, Nearly Triple Cargill Profits," Minneapolis Tribune, Dec...
...agricultural strategy...
...arsenal...
...Profits soared as the price of grain on the international market reached unprecedented levels...
...Interview with former employee of Cargill...
...Address all correspondence to Box 57, Cathedral Station, New York, NY 10025 or Box 226, Berkeley, CA 94701...
...For more on the role of corporations in the food and energy crisis and the economic and political implications for American working people, see Stanley Aronowitz, Food, Shelter and the American Dream (New York: Seabury Press, 1974...
...Not only did the opening of trade with the Soviet Union play an important role in the U.S...
...Interview with Richard Bell, the Assistant Secretary of Agriculture for International Affairs and Commodity Programs...
...U.S...
...grain at bargain prices.'16 Less well-known is the fact that far from being a surprise to U.S...
...economy...
...3 9 Humphrey knows many of the Cargill officials on a first name basis and he makes occasional visits to the company chateau outside Minneapolis...
...1965 Brazil Feed plant, poultry Part of Cargill Agricola, S.A...
...After the second devaluation in early 1973, the Japanese yen had appreciated 40 percent and the value of U.S...
...market development programs in penetrating foreign markets...
...agriculture would have to be converted into an efficient export industry...
...Ibid...
...Organizations like the Western Wheat Growers Associates have taught people throughout Asia to bake and eat bread, thus increasing demand for U.S...
...Testimony of William Goodfellow before the House Appropriations Committee on Agriculture, Congressional Record, May 9, 1974, p. S 7546...
...One solution was to divert a large share of U.S...
...negotiators to trade off concessions from the U.S...
...Aside from obtaining loans from many of the smaller midwestern banks, Will Cargill befriended a prominent Milwaukee banker, Robert Elliott, who "backed his friend not once, but again and again to their mutual benefit...
...2, 1973...
...exports came in 1972 as a result of the Soviet Union's purchase of more than $1 billion worth of grain from the United States, including one fourth of the U.S...
...Under increasing scrutiny because of the food crisis, the company fears that public discontent may lead to government intervention...
...Under Kissinger's direction, U.S...
...644 790 India...
...Cargill was required to submit the report when it tried to purchase the Missouri Portland Cement Company, a public corporation...
...Both the Departments of State and Agriculture agree that "food aid and food reserves are two separate questions...
...influence in the recipient countries...
...The export drive contributed to food price inflation of 20 percent in 1973...
...I know that is a strong statement but in view of continued harassment, new decrees and restrictions, I cannot help but draw that conclusion...
...Bids are made in fractions of a penny per bushel as a company strives to beat out a competitor for a potential sale...
...Within several years, Will was joined in the grain trading business by two of his brothers, and they built elevators and grain storage houses in Iowa, Minnesota, and Wisconsin...
...This pressure for profit translates inexorably into rising food prices.7 "Our primary concern is commercial exports...
...Due to the accumulation of grain surpluses in the 1950's and '60's, the operation of storage facilities by the large grain companies figured prominently in their market strategies...
...Food imports doubled in 1971 to $261 million, and rose to an estimated $383 million in 1972.22 With foreign exchange nearly exhausted and lines of credit cut off by the U.S., Chile had great difficulty meetings its food import needs...
...Cargill's influence pervades both of the major political parties...
...grain surpluses set off a price spiral as other nations rushed to secure the remaining grain supplies...
...But ideological considerations do not starid in the way of the company's business interests...
...power...
...The CAP has been a thorn in the side of U.S...
...Thus, higher food prices and the resultant decline in the standard of living for North Americans are acceptable to the multinationals, especially when these changes are part of a strategy to prop up the U.S...
...Hubert Humphrey, who observed at the time: I have heard . .. that people may become dependent on us for food...
...2 0 The relationship between the two goes back decades, at least to 1933, when John Peterson left Chase to join Cargill as its chief financial officer...
...When this failed to reverse Korea Cargill's financial fortunes, it called upon the U.S...
...4. Aide to a Senator on Committee on Agriculture and Forestry...
...Former Cargill employee, op...
...Quoted by Dan Morgan, "Food Aid Role Weighed," Washington Post, March 14, 1975...
...In May 1975, the company's world-wide sales stood at about $9 billion, making it the largest private corporation in the United States...
...The biggest of the grain companies, it controls about one-quarter of U.S...
...Government intervention to iron out the rises and falls in agricultural prices are abhorred by the companies, since this would limit their ability to profit from the cyclical nature of agricultural trade...
...Ten years ago, South Korea had no livestock industry, and today it imports 800,000 tons of feed grain annually...
...grain exports, and is the largest single contributor to the U.S...
...4 0 Since U.S...
...IX, No...
...Del Monte Corporation, for example, which is the world's largest processor of fruits and vegetables, grows asparagus in Mexico for export to the United States, and pineapples in Kenya for export to Europe...
...The concessional credits offered to foreign governments to import U.S...
...See also Minneapolis Tribune, February 10, 1970...
...1965 Canada Poultry breeding Purchased Canadian-based Shaver Poultry, with subsidiaries in England, Germany, Sweden, India, Barbados, Pakistan & Japan...
...With farm input purchases amounting to $75 billion annually,' 0 the large corporations that manufacture machines and chemicals (such as International Harvester and Dow Chemical), view food production as a source of capital accumulation that is expected to yield the same rate of profit as any other industry...
...Accordingly, under capitalism a rationale still exists for a group of companies to buy and sell grain without being directly involved in production...
...Financial Report submitted in December 1973 to the Securities and Exchange Commission...
...6 Be it detente with the Soviet Un negotiations with the European Common companies work closely with the U.S...
...The * The General Agreement on Tariffs and Trade, or GATT, is one of the multilateral institutions that grew out of post-war efforts to re-structure the international economic system...
...Today, the two families own 85 percent of Cargill's stock, and Whitney MacMillian serves as president...
...But just as it appeared that Cargill and the other grain companies would have to reconcile themselves to a smaller role in the world export markets, the U.S...
...These companies control export-import facilities in Europe, operate large shipping and transportation networks, have close relations with European bankers, and even own manufacturing subsidiaries in Europe that process imported grain...
...embassy costs to Department of Defense expenditures), thereby offsetting the outflow of dollars...
...Quoted by Goodfellow, ibid...
...And finally, counterpart funds were a device to channel direct military aid to U.S...
...85-87...
...In 1973, the cost of their food imports doubled, as their import bill from the United States increased by $2 billion...
...economy has become increasingly dependent on imported raw materials...
...imperial interests...
...Not all of Cargill's capital needs are satisfied by lines of credit with commercial banks...
...Bunge Corporation representative, op...
...Cargill official, op...
...Since Cargill, however, deals primarily in the buying and selling of commodities, it is more accurate to compare it to the leading merchandising firms where it would rank 5th, just behind J. C. Penney, but ahead of Montgomery Ward...
...Senate, Committee on Agriculture and Forestry, Subcommittee on Foreign Agricultural Policy, Hearings, U.S...
...arms in the world.2" The government also received $61 million in local currency to underwrite its budget and support its repressive apparatus...
...In the late 1960's, when the United States lost the profitable Iranian vegetable oil market to cheaper Soviet products, the Agriculture Department stepped in to reclaim the market by offering the Iranians low-cost, long term PL 480 credits...
...In the '60's and early '70's, it established subsidiaries in El Salvador, Guatemala, the Philippines, Argentina, Pakistan, Brazil, Taiwan, and South Korea...
...13 Moreover, special provision was made for both Cambodia and South Vietnam to allow an expanded use of counterpart currencies for direct military purposes...
...It may be the one thing that we have in greater abundance and in the ability to produce beyond anyone else...
...By 1962, Cargill, through its wholly owned Nutrena* subsidiary, operated 27 domestic feed mills, and in addition owned 14 vegetable oil processing plants...
...Retired Cargill official, op...
...Besides dealing in grain, the companies have diversified into everything from food processing to real estate and steel...
...And PL 480 also become an increasingly important element in U.S...
...It seems clear that the world of the poor, at least, will experience continued food shortages and occasional famine over the coming decades...
...A U.S...
...The Nixon Administration acted aggressively on the international front to implement the export drive: the announcement of the New Economic Policy (NEP) and the accompanying dollar devaluation, the opening of trade with the Soviet Union, and the attempts to liberalize world trade at the multilateral trade negotiations were all part of the long-range strategy to expand agricultural exports and bolster the U.S...
...Cargill official, op...
...cit.31 THE GRAIN TRADE 1. Interview with official at General Accounting Office (G.A.O...
...balance of trade $8 billion by 1980...
...The Japanese market was carefully nurtured during the 1950's through PL 480 shipments, and most recently through the promotional activities of the trade associations...
...economic hegemony...
...Today the U.S...
...Pearce played a prominent role on the Commission, even writing much of the final report himself...
...grain industry lobbied to prevent the Indian government from starting an indigenous processing industry...
...2 9 Almost overnight, Cargill had become a major factor in the vegetable oil and animal feeds industries of Western Europe...
...Interview with officials at the Agriculture Department, including a former administrator of the Barter Program...
...In the past twenty years, approximately $25 billion worth of commodities have been shipped abroad under PL 480 to serve a variety of U.S...
...4 1 A member of the Cargill family has also worked in Mondale's office...
...It means developing markets...
...But the Junta received a double benefit...
...Domestically they control local grain elevators, storage bins, railroad cars, shipping barges, and port elevators...
...Because of such links, one government investigator who is looking at the grain trade succinctly labeled the situation in the U.S.D.A...
...Politically, the 20-odd people who run Cargill are rock-ribbed Republicans almost to a man, and within the party they support the more conservative positions...
...policies: first, they had to compete on the world market for scarce commodities at rising prices, and second, their financial position deteriorated as a result of devaluation...
...Bunge & Born began operating in the United States in 1919, but its real growth in this country occurred after World War 11...
...92,942 678,651 Bunge Corporation 58,516 641,022 SFigures not available for 1968-1971...
...In fact, throughout the '60s, the maritime unions were attacked by the grain companies as the chief obstacle to trading with the Soviets...
...He went on to add "I understand many of the grain companies do it...
...I do not like what is going on and I am not alone...
...In addition, the plan to overcome the U.S...
...The immediate effect of the sale was to boost the U.S...
...The Commodity Credit Corporation (CCC) granted one to three year loans to foreign governments to purchase its surplus grain reserves, while the Barter program provided an effective subsidy for U.S...
...negotiating kit...
...However, Cargill still depended heavily on land transportation for moving much of its grain...
...In July 1972 Continental Grain Co...
...See also Overseas Private Investment Corporation (OPIC), Direct Loan Investment Guaranty, Brazil: Cargill Agricola, S.A...
...PL 480 credits allocated for South Korea this fiscal year come to $150 million, 17 percent of the total program and double what South Korea received last year...
...The recent grain inspection scandals, which have resulted in the indictments of many grain inspectors and company officials, must also be seen in the light of the companies' 1819 market manipulation...
...4. Work, op...
...Thus a large grain company with advance knowledge, or the ability to project the movement of the market, will profit from the futures contract, while the farmer is least likely to come out ahead...
...312 759 Iran...
...trade crisis - to pay for imported oil and manufactured goods, and to maintain the value of the dollar...
...Cargill and the four other major grain companies dominate the grain markets of Western Europe...
...corporation.* Two Minneapolis based families-the Cargills and the MacMillans--own 85 percent of the company's stock and run one of the world's most secretive and far-flung commercial empires...
...negotiators ran into obstacles in agriculture, "they went ahead in the industrial area alone and didn't pay much attention to agriculture...
...The political usefulness of food aid stems mainly from Title I credits...
...Interview with an aide to a Senate Subcommittee investigating the grain trade...
...Though Cargill complained about the "frequent and serious incursions by various * The Creditors Committee was composed of representatives of the First National Bank of Minneapolis, the Boston commercial firm of Bond & Goodwin, and a lumber magnate, F. P. Dixon...
...264 388 People's Republic of China...
...Payoffs: Common in Foreign Grain Sales," Des Moines Register, July 13, 1975...
...trade deficit: the U.S...
...1,195 1,310 Republic of Korea...
...EXPANSION AT HOME AND ABROAD By the early 1920's, Cargill had fully recovered from its brush with bankruptcy and embarked on a new expansive phase...
...Like other large corporations under monopoly capitalism, Cargill seeks to limit the commercial options available to the small producer...
...Cargill's subsidiary (called Korea Cargill) also provided lucrative opportunities for Koreans who had served the U.S...
...In 1974, Chile was the ninth largest purchaser of U.S...
...As an AID official put it, "U.S...
...The leading grain trader, Cargill, also proved to be one of the leading beneficiaries...
...has been to encourage surpluses, which are then exported from Europe with the aid of government subsidies...
...In the past 20 years, South Korea has received more PL 480 commodities than any country except India...
...Shortly after the Congressional limitation passed, the United Nations, in an unannounced move, suddenly put Egypt on its "Most Seriously Affected" list, thus removing it from the congressional restriction.31 In fiscal year 1975, Egypt received the third largest amount of PL 480 credits, for a total of $120 million...
...In the last part, we look at the five companies that dominate the grain trade...
...At the heart of these forces is the historical development of capitalism...
...5. G.A.O., op...
...One source noted that "for the past five yars Cargill has consistently earned profits in excess of 20 to 25 percent...
...food arsenal is the food aid program...
...grain company representatives say Americans can no longer take cheap food for granted...
...2. John L. Work, Cargill Beginnings...
...Interview with an aide to a Senator on Committee on Agriculture and Forestry...
...In 1965, it purchased Shaver Poultry Breeding Farms, a Canadian firm that ships breeding stock abroad...
...Foreign Agricultural Policy, PhD...
...Companies such as Cargill stored the CCC grain in their facilities in return for government storage payments...
...The CIA is even more optimistic about the boost to U.S...
...But they rely on us for soybeans, feed grains and wheat...
...corporations-Ralston Purina, Cargill, and Peavey-which set up their operations with loans from PL 480 proceeds...
...strategists, the fall of U.S...
...food relief program to support anti-communist forces in Eastern Europe, and as a lever to extract political concessions from the Bolsheviks in Russia...
...Its international trading operations are directed by Tradax, a subsidiary with headquarters in Geneva...
...It is not the farmer who benefits from higher prices...
...In a cooler and therefore hungrier world, the U.S...
...Peter Peterson, the President's advisor on international economic policy, incorporated the Commission's findings into his own report to the president, which was the basis for the NEP...
...economic and political interests around the world...
...By the 1880's, Cargill operated along major railway arteries in five states-North and South Dakota, Iowa, Minnesota, and Wisconsin...
...The free market serves the oligopolies," as one government official observed.' While advocating a free trade policy, the com incessantly to influence and control the State...
...Trade and Economic Council, while the retiring president of Cargill, Fred M. Seed, serves as a director of the National Council for U.S...
...markets overseas being lost...
...For example, between 1964 and 1965, Cargill exported $200 million under PL 480 while its total exports stood at $700 million.' 0 As the accompanying table shows, Cargill was a principal beneficiary of PL 480 Title I financing...
...government.14 In mid 1973, Congress made a move to halt this practice, prohibiting the use of food aid sales proceeds for military purposes...
...As revealed in Senate hearings on the Soviet grain transaction, in late 1971 Soviet and U.S...
...Under Title II, the U.S...
...Department of Agriculture figures cited in Frundt, op...
...Continental Grain Co...
...Every year they move billions of dollars of grains* from the surplus producing countries to the food deficit areas of the world...
...cit., p. 95...
...In some years 70 percent of total U.S...
...export strategy had its intended impact: agricultural exports were at record highs,* U.S...
...Louis Dreyfus Corporation Of the five major grain companies, least is known about Dreyfus...
...Profits were $107.8 million, or over 43 percent return on assets.-s No other large corporation in recent history has reported such astounding profit margins.* * The figure of 43 percent return on net assets should not be confused with annual percentage increase in profits...
...As a result, Colombia now imports over 85% of its wheat requirement...
...Projected country spending levels for PL 480 are contained in the annual AID Program Presentation to Congress...
...For example, in the Central America countries, local and foreign capitalists, instead of producing nutritional foods to feed Central Americans, are major exporters of bananas, coffee, and now beef...
...However, many of these endeavors were speculative, and the new family scion, William S. Cargill, proved incapable of managing the company's overextended businesses in the face of the economic downturn that began in 1906...
...creating new vegetable oil business in Spain and Holland...
...However, its complex U.S...
...representative of the Bunge Corporation...
...files on Private Trade Entity loans...
...Cargill is also active in the Japanese poultry and meat industries...
...intervention in Vietnam placed new limits on their ability to protect U.S...
...There's no way of knowing how much this amount may be increased in the course of the year...
...It is likely that in the future, as the conflict between the United States and the Third World heightens, policy-makers will look increasingly to U.S...
...and Feedstuffs, June 9, 1975...
...He was a leading architect of the Williams Commission Report (which drew up the blueprint of U.S...
...The enterprise began operations in Argentina in 1884 when Ernesto Bunge, a descendant of an old Belgian trading family, joined with Jorge Born to set up a grain exporting firm...
...If we and other nations are to continue reaping the benefits of specialization, a greater spirit of international reciprocity must be developed...
...Foreign policy strategists were, of course, anxious to avoid this kind of interference, and sought to channel funds through safer mechanisms not so vulnerable to the Congressional scalpel...
...feed manufacturers...
...Subscriptions: $10 per year for individuals ($18 for two years), $16 per year for non-profit institutions ($30 for two years), $25 per year for profit-making and government organizations ($48 for two years...
...Many countries had their currencies pegged to the dollar, and almost all held their foreign exchange in dollars...
...OPIC, op...
...grain uncompetitive in world markets...
...New York Times, May 9, 1975...
...In recent negotiations, the Soviet Union has agreed to pay the higher rates charged by U.S...
...2 2 Over the years Cargill and the other grain companies have become especially adept at tapping public financing...
...For Cargill, as well as for the grain industry as a whole, Chase is the "lead Bank...
...The prices on these pre-harvest sales, or futures contracts, are determined by what the buyer and seller predict will be the value of the grain when it is delivered...
...Government involvement in domestic and export programs was also an obstacle to the free trade strategy aimed at penetrating foreign markets...
...3 0 For U.S...
...is the largest privately owned U.S...
...interviews conducted by NACLA's Agribusiness Project...
...Miami Herald, November 26, 1973...
...grain companies...
...government complicity in a sale that disrupted the word food market was covered over...
...Immediately after the war in Europe, U.S...
...Continental Grain Today is Interdependence Day...
...balance of payments was increasingly in the red...
...balance of payments...
...transportation system as grain was moved from internal markets to the ports, the companies used their control of the railways to hold down the price they paid for wheat...
...Interview with a Vice President of Continental Bank of Illinois...
...Thus Third World countries were faced with a double hardship as a result of U.S...
...The OPIC papers were obtained through a Freedom of Information Act request, and although extensively edited by OPIC officials, the papers contain information on Cargill's Brazilian operations...
...worker as only one of many market outlets explains why the Secretary of Agriculture, Earl Butz, pushes ardently for foreign grain markets while simultaneously calling for a reduction in the Food Stamp program...
...investors in Peru, the State Department also "put the muzzle" on CCC credits to that country...
...Stephen Rosenfeld, "The Politics of Food," Foreign Policy, Spring 1974, p. 22...
...workers to sustain their economic growth...
...PL 480 credits for the Middle East will be announced shortly, but according to one Agriculture Department official, Kissinger has already made large commitments.33 FOOD BLACKMAIL AGAINST THE THIRD WORLD Food has also become an important political weapon in U.S...
...1,470 1,631 West Germany...
...Can Agriculture Save the Dollar...
...To protect itself, Cargill will strive to maintain the veil of secrecy and attempt to use friendly politicians and bureaucrats as a protective shield...
...grain exports are wheat, corn, and soybeans...
...food exports...
...In addition, U.S...
...Peter Peterson, quoted in Raford Boddy and James Crotty, "Food Prices: Planned Crisis in Defense of the Empire," Socialist Revolution, April 1975...
...demands, the Flanigan report recommends that the United States threaten to enact protective measures against industrial imports from Western Europe, and this is precisely current U.S...
...To deal with the two basic problems of U.S...
...Now, minor changes in production in one area set off economic shockwaves around the world...
...food was sent to Italy and France to counter the threat of a working class that was moving increasingly to the left...
...the United States was also importing more consumer goods...
...farm programs designed to protect farmer income and moving to a market-oriented agriculture - a change the grain companies had long supported...
...See Kissinger's speech of September 2, 1975, and interview with Kissinger in Business Week, January 13, 1975...
...chain with subsidiaries in Belgium, West Germany and France...
...2. United States International Economic Policy in an Inter dependent World, Report to the President submitted by the Commission on International Trade and Investment Policy (Washington, D.C.: July 1971...
...The Cooley loan program derived its name from the late Rep...
...South Korea is another example of the success of U.S...
...In 1972 they doubled to $11 billion, and by 1974 agricultural exports stood at an all-time high of $21 billion...
...Two Born brothers were recently kidnapped by Argentine guerrillas, and released in exchange for a $60 million ransom...
...foreign policy...
...secondly, at undercutting the efforts of other countries to follow the OPEC example...
...Thus the bulk of the world's food exports - be it grain from the United States or bananas from Latin America - flow to the industrialized nations...
...This change is reflected in the Administration's food aid plans...
...This provision was originally enacted at the time of the first Soviet grain purchases in 1963 because of maritime union pressure, and had effectively prevented further sales to the Soviet Union...
...Its barges and tow boats plied the Missouri, Ohio, Tennessee, Illinois and Mississippi Rivers, making Cargill one of the largest shippers in the United States...
...When eastern grain trading interests began moving into the Midwest markets to bypass the regional grain dealers, Cargill responded by establishing direct sales offices in the East...
...Washington Post Parade, July 2, 1975...
...The Nixon Administration was finally able to make a decisive move to free market agricultural policies...
...It has not been our policy to use food as a political weapon despite the oil embargo and recent oil price and production decisions...
...As the vice-president of Continental Grain Company complained, when U.S...
...Michael Fribourg assumed control of the company in 1944 at the age of 30, and quickly turned the firm into one of the world's largest grain merchandisers...
...The dollar credits still give "friendly" governments important balance of payments support, and the local currency sales proceeds go directly into government treasuries to support their domestic budgets, including military expenditures...
...In the words of Secretary of Agriculture Earl Butz, Agriculture has now become our number one source of foreign exchange and it's a powerful factor in maintaining the economic health of this country.' The origin of current policies goes back to strategies devised by government and corporate leaders in the early 1970's to meet the emerging economic crisis...
Vol. 9 • October 1975 • No. 7
