Key

Debates in

Food and

Agriculture

June 2013

This special collection of articles is a joint project of the Department of Environment and

Development of the University for Peace and the Peace and Conflict Monitor

Cover photo by Jon Mollivan

All of our content is licensed under a Creative Commons Attribution-NonCommercial-

NoDerivs 3.0 Unported License.

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Key Debates in Food and Agriculture: An Introduction

This is the first of what will become an annual special issue of the Peace and Conflict

Monitor dedicated to showcasing student scholar contributions devoted to key debates

in food and agriculture. This inaugural issue groups six articles, which emerged from a

University for Peace course titled, “Food Sovereignty, Hunger and Sustainable

Agriculture.” The articles reflect a geographically and topically diverse assemblage of

critical reflections on contemporary food and agricultural topics. Together they assert

critical, and at times, counterintuitive positions to transform current food systems

towards greater equity and sustainability.

Two of the papers analyze one of the more controversial and successful cases of

sustainable agriculture, Cuba. In Cuba, A Successful Test Case for Sustainable Urban

Agriculture, Moses Jackson interrogates whether Cuba deserves its reputation as a

sustainable urban agricultural model. Jackson asserts that Cuba indeed deserves such a

reputation given the rise in agricultural productivity since the fall of the Soviet Union

and the widespread use of agro ecological as opposed to conventional farming

methods. In Cuba’s Next Revolution: A Fight Against the Rise of a Neoliberal Food

Dictatorship, Christina Kehoe, a daughter of a Cuban immigrant to the United States,

argues that Cuba must continue with protectionist and agro ecological policies in order

to safeguard national food sovereignty. Kehoe argues that recent attempts by Raul

Castro to implement export-oriented and conventional agriculture will only lead to

greater dependency and food insecurity.

Three papers critically analyze institutions that are central to food system

governance. In Microdebt: Gender-based Exploitation and Agrarian Crises, Valerie

Puleo interrogates the impacts of microfinance via a case study of Andhra Pradesh,

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India. Puleo asserts that though microfinance is touted as a tool to empower women by

extending lines of credit to women to purchase expensive agricultural inputs, in reality,

the practice of microcredit disempowers women by produces cycles of debt,

responsibalizing women to acquire credit for their husbands, and submitting women to

harmful group pressure. The essay titled The Cotton Conundrum: How Brazil Revealed

the Global Governance Potential of the WTO by Cassie Mullendore analyzes the recent

World Trade Organization Dispute Settlement Body (DSB) case where Brazil argued

that US cotton subsidies are illegal. Mullendore asserts that though critics of the WTO

regularly content that it is only a tool of powerful nations to manipulate access to

foreign markets, the DSB ruling in favor of Brazil, and the subsequent imposition of

cross-retaliation measures, demonstrates how the WTO can be a mechanism for greater

fairness in global agricultural policy. In SNAP: an Inadequate and Potentially Harmful

Food Assistance Strategy in the United States, Erin Brewster argues that the United

States’ primary food assistance program – SNAP – does not adequately address food

insecurity and may make it more likely that citizens remain on government assistance.

Brewster shows how by only providing economic assistance for food provisioning, and

not dealing with the structural and geographical deterrents to accessing food, SNAP

does not sufficiently address the nutritional and health aspects of food security.

The final paper explores the politics of food and food aid on the Korean peninsula.

In Food Insecurity in North Korea: Why South Korea Should Take Action on Food Aid,

Hee-Yoon Kim forcefully argues for South Korea to take the lead in providing bilateral

food aid to North Korea. Though many critics contend that food aid to North Korea

only further entrenches the Kim Jong-un regime, Kim argues that food aid must be

strengthened on humanitarian grounds, and as an investment for future reunification.

Together these papers present forceful arguments that challenge conventional

understandings of contemporary food and agriculture controversies. It is the hope of

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the special issue authors, and the editorial staff of the Peace and Conflict Monitor, that

these essays will generate greater debate and scrutiny of the covered topics.

Brian Dowd Uribe

Assistant Professor, Department of Environment and Development

University for Peace

Guest Editor of the Special Issue

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Cuba: A Successful Test Case for Sustainable Urban Agriculture

Moses Jackson

Introduction

The 1989 collapse of the socialist bloc and subsequent tightening of the U.S. trade

embargo had dramatic consequences for the island nation of Cuba. The resulting

economic crisis, dubbed el período especial en tiempos de paz, or “special period in time of

peace,” necessitated a number of far-reaching structural changes in Cuban governance

and society. Because Cuba previously relied on the international socialist economy for

85% of its trade, food security quickly became paramount (Altieri et al. 2009). Strict

austerity measures were implemented as Cubans struggled to feed themselves, losing

an average of 20 pounds per person. Cuba’s previous agricultural model was oriented

toward “monocrop production of export crops and a heavy dependence on imported

agrichemicals, hybrid seeds, machinery, and petroleum” (Rosset 2005, p. 2). The loss of

critical trade links meant that an entirely new agricultural model was needed as

imported agricultural inputs, machinery, and fuel for transportation and traction

suddenly became scarce. Almost all food would need to be produced domestically, and

much of it organically. The sweeping agriculture reforms implemented toward that end,

referred to as the “greening of the revolution” (Rosset & Benjamin 1994), resulted in a

unique agricultural model widely praised for its sustainability. Urban gardens became

the centerpiece of the model.

I argue in this paper that, despite claims to the contrary, Cuba’s post-Cold War

agricultural paradigm represents a valuable test case for sustainable urban agriculture

in that it has been largely successful in feeding the Cuban people during acute scarcity

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and economic crisis. Critics argue that the Cuban model is not a valuable case study

since it is not successful or sustainable (Avery 2009). Though empirical data is

somewhat limited given Cuba’s geopolitical isolation, there is strong evidence

suggesting otherwise. This paper, which draws on the work of a relatively small

number of researchers with access to reliable data, briefly distinguishes key elements of

the Cuban agricultural model, outlines some of the strongest criticisms of the model,

and refutes those criticisms.

Cuban Agriculture: A New Paradigm

Modern Cuban agriculture is characterized by sustainable urban agroecology,

reflecting a sharp departure from the nation’s previous emphasis on industrial

monocrop production. While conventional wisdom dictates that small island nations

can only overcome food shortage through increased imports, chemical inputs, and

large-scale corporate or state-led farms, Cuba did so without strict reliance on any of

these measures, effectively turning “conventional wisdom completely on its head”

(Rosset 2005, p. 6). Instead, necessity spurred the development of an alternative,

decentralized, organic food production system based on agroecological principles and

supported by hundreds of thousands of smallholders. State-sponsored land

redistribution, targeted agricultural research, and social movements were crucial to this

transformation. Though conventional industrial agriculture continues in Cuba, it now

represents less than 10% of cultivated land.

Sustainable Agriculture

The term “sustainable agriculture,” while difficult to define precisely, is often

invoked as a counterpoint to the large-scale, high-input, highly mechanized agricultural

systems prevalent throughout much of the industrialized world (Hiranandani 2010).

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Industrial agriculture, with its emphasis on high yields in the short term, reliably

produces undesirable long-term ecological and social outcomes—many of which are

exacerbated by global climate change. Many of conventional agriculture’s limitations

were plainly evident in Cuba, where over-reliance on intensive monocrop production of

sugarcane and other export commodities led to environmental degradation, a

marginalized peasantry, and, ultimately, an acute food shortage. By contrast,

sustainable agriculture encompasses environmental, social, and economic dimensions

(Pearson et al. 2010). It is multi-functional and “incorporates concepts of both resilience

(the capacity of systems to buffer shocks and stresses) and persistence (the capacity of

systems to continue over long periods), and addresses many wider economic, social and

environmental outcomes” (Pretty 2007, p. 447).

Urban Agriculture

Even still, “sustainable agriculture” is a broad enough term to be ambiguous when

used without clarification. Sustainable rural agriculture is distinct from sustainable

urban agriculture, for instance. Urban agriculture has been critical to Cuba’s food

security given that 75% of the Cuban population is located in urban centers.1 Urban

agriculture refers to “all agricultural and animal production that occurs within cities or

peripheries that receive direct influence from cities, so that the productive process is

intimately linked to the urban population” (Altieri et al. 1999, p. 132). Urban agriculture

in Cuba has a technological component as well as a geographical component in that

“essentially all of this production is ‘agroecological’ or ‘organic’ and avoids the use of

petrochemicals” (Koont 2009, p. 311). Urban gardens developed quickly during the

special period, with eight distinct types of urban gardens emerging: intensive gardens,

organoponicos, suburban farms, popular gardens, enterprise and factory gardens,

hydroponics, and household gardens. In 1996, there were an estimated 7,998 total urban

1 CIA World Factbook. <https://www.cia.gov/library/publications/the-world-factbook/> Accessed January

23, 2013.

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gardens in Havana alone, occupying 15,092 hectares of land (Altieri et al. 1999). In 2009

there were an estimated “383,000 urban farms, covering 50 thousand hectares of

otherwise unused land and producing more than 1.5 million tons of vegetables” (Funes

et al. 2009, p. 5).

Agroecology

Agroecology is a defining characteristic of modern Cuban agriculture. Altieri

(2002) posits five principles of agroecology as a practice: increasing biomass recycling

and balancing nutrient flows, assuring favorable soil conditions, minimizing nutrient

losses, promoting the functional biodiversity of the system, and promoting increased

biological interactions among system components without external inputs. The

influential global peasant movement La Via Campesina builds on these biophysical

elements and stresses agroecology’s social elements, arguing that agroecology allows

for “increased autonomy from input markets, putting peasant families in control of

their own production systems, restoring degraded soils, living in harmony with the

Mother Earth, producing healthy food, improving the economic viability of peasant

agriculture, and building food sovereignty” (Rosset et al. 2011, p. 165). La Via

Campesina’s Campesino-a-Campesino (CAC) social progress framework, organized by

ANAP (Asociación Nacional de Agricultores Pequenos), Cuba’s national peasant

association, has been instrumental in the adoption and rapid diffusion of agroecological

knowledge and practices in Cuba. This successful knowledge transfer was aided by

Cuba’s high level of education, which is evidenced by the fact Cubans account for only

2% of the Latin America and Caribbean region’s total population but 11% of its

scientists (Koont 2009).

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Success

State-sponsored development of sustainable urban agroecology has allowed Cuba

to overcome a severe food shortage and achieve food security despite political,

economic, and physical isolation. Cuba was disastrously food insecure leading up to

and during the special period, and the results of the nation’s subsequent agricultural

paradigm shift are unambiguously positive. Cuba’s per capita dietary energy supply in

2007 was 3,200 kilocalories—by far the highest in the Latin America and Caribbean

region. An estimated

100,000 families—almost half the population of independent small farmers in

Cuba—who are members of ANAP practice agroecological diversification methods

in their farms producing much more food per hectare than on commercial, industrial

agriculture farms. These family farmers, many of whom are part of the CAC

movement, produce over 65% of the country’s food, on only 25% of the land (Funes

et al. 2009).

By 2001, “urban agriculture accounted for almost 60% of the vegetables and a high

proportion of the eggs and poultry meat consumed in Cuba” (Hiranandani 2010, p.

769). Moreover, Cuba is a world leader in organic food production. Cuba’s emphasis on

“agroecology, inter-cropping, organic soil management, the production and use of

organic fertilizers, vermiculture, compost and biological controls (integrated pest

management), urban agriculture and the use of medicinal plants” has allowed the

nation to transition almost completely to organic agriculture. By comparison, only 1.5%

of Canada’s agricultural output is produced organically (Hiranandani 2010, p.769).

Perhaps the most telling indicator of Cuba’s success is its rate of growth of per

capita food production. Between 1986 and 1995 the rate was -5.1%—the lowest in the

Latin America and Caribbean region. Between 1995 and 2004 the rate reached an

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impressive 4.2%—by far the highest in the region. This remarkable turnaround is

another clear testament to the success of Cuba’s new agricultural paradigm (Funes et al.

2009).

However nebulous the term “sustainable agriculture” may be, the Cuban case is

helping to define it. Rosset (2000) draws on Cuba’s success to offer four elements of an

alternative, sustainable agricultural paradigm: reliance on agroecological technology

instead of chemicals, fair prices for farmers, land redistribution, and greater emphasis

on local production (p. 7). Warwick (2001) argues that “The Cuban experience has done

much to confirm the benefits of small-scale, sustainable agriculture” (p. 56). Altieri

(2012) maintains that “the experience accumulated from agroecological initiatives in

thousands of small-and-medium scale farms [in Cuba] constitutes a valuable starting

point in the definition of national policies to support sustainable agriculture, thus

rupturing with a monoculture model prevalent for almost 400 years” (p. 30). McKibben

(2005) asserts that Cubans “have created what may be the world's largest working

model of a semi-sustainable agriculture, one that doesn't rely nearly as heavily as the

rest of the world does on oil, on chemicals, on shipping vast quantities of food back and

forth” (p. 62). By adopting national policies that effectively promote urban agroecology,

Cuba has achieved a historic transition from a failed agricultural model to one of the

world’s most successful and sustainable.

Major Criticisms of Cuban Agriculture

Cuban agriculture is not without critics. Dennis Avery of the Hudson Institute

challenges Cuba’s much-touted food security, asserting that “Cuba’s organic success

was all a lie—a great, gaudy, Communist-style Big Lie of the type that dictators behind

the Iron Curtain routinely used throughout the Cold War to hornswoggle the Free

World” (Avery 2009, second paragraph). At the core of Avery’s argument is the claim

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that 84% of Cuba’s food for consumption is actually imported. This claim speaks to the

so-called “paradox of Cuban agriculture,” or the apparent contradiction between

Cuba’s agricultural sustainability and its ostensibly high import dependency (Altieri

2012). This broader argument, if true, may have far-reaching implications that warrant

careful consideration. In the following section I analyze this criticism in detail, drawing

heavily on Funes et al.’s 2009 response to Avery.

Import Dependency

Avery’s claim that 84% of Cuban food is imported is misleading at best and false

at worst. The claim is based on a statement made by Cuba’s Vice Minister of the

Economy and Planning Ministry in 2007, who said that 84% of items in the “basic food

basket” were imported at that particular time. The figure thus refers to food distributed

via government-issued ration cards, which accounts for less than a third of food

consumed by Cubans.

Data from the Food and Agriculture Organization of the United Nations (FAO)

indicates that Cuban import dependency declined steadily between 1980 and 1997, with

a brief spike following the onset of the special period. Import dependency rose in the

2000s as trade restrictions were relaxed and the nation began purchasing large

quantities of food from the U.S. and elsewhere. Cuba imported an estimated 55% of

total food for consumption in 2008—an admittedly high proportion. However, in 2008

Cuba was struck by three hurricanes, including hurricane Ike, which devastated crops

and caused extensive infrastructure damage throughout the country. It is unlikely that

any island nation could withstand such extreme weather events without importing

large quantities of food as an emergency measure. Furthermore, Cuba’s more

agroecologically integrated farms suffered far less storm damage (50% compared to

90% on monocrop farms) and recovered much faster, effectively underscoring the

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resiliency and sustainability of Cuban agroecology over and above conventional

agriculture.

FAO data from 2003 indicates that Cuba’s total food import dependency that year

was the lowest in the region at only 16%. The nation fared relatively poorly with certain

foods like vegetable oils, oil crops, and cereals, but it fared very well with Cuban staples

like starchy roots, eggs, vegetables, and fruits. It is important to bear in mind that high

import dependency remains the norm throughout the region. Surely Cuba’s success

should be gauged against its regional counterparts rather than in a vacuum. In this

context, Cuba’s gains toward food self-sufficiency are remarkable (Funes et al. 2009).

Blockade Issues

Much of the food imported in the 2000s was purchased via the exploitation of a

humanitarian aid loophole in the trade embargo. While Avery interprets this practice as

evidence of Cuba’s underlying agricultural deficiencies, in reality it has little bearing on

the nation’s ability to feed itself. State decisions regarding food importation are rarely

based on supply and demand factors alone, and Cuba must consider a particularly

complex set of long-term political and philosophical factors when making such

decisions. In 2000, following U.S. President Clinton’s authorization of the sale of certain

humanitarian products to Cuba, the Cuban government began importing large

quantities of unneeded food from the U.S. as a means of eliciting anti-embargo support

from within the U.S. Cuba’s motives to lift or skirt the embargo thus go well beyond

food security and speak to broader macroeconomic factors and the evolving geopolitical

landscape. Cuba has already proven the success of its agroecological model, as

established above, and its efforts to end the most enduring trade embargo in history are

not simply for want of more food. Moreover, the fact that Cuba imports unneeded food

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skews import dependency data, suggesting that Cuba’s true import dependency is even

lower than the data indicates.

Industrial Expansion

In recent years Cuba has experienced an expansion of large-scale industrial

agriculture, much of which is supported by politically sympathetic nations like

Venezuela and Brazil. While a cursory analysis might interpret this as a sign that Cuba

is failing to produce sufficient food, a deeper investigation reveals that this is not the

case. The existence of industrial agriculture in Cuba does not mitigate the country’s

agroecological success; Cuba’s motives for initiating industrial agricultural projects,

which typically seek to “protect” or “boost” intensive agricultural areas, stem from

external political and economic pressures rather than internal pressures. One example is

the “Bienvenida la Soya” soy project, which aims to reach 40,500 monocropped hectares

by 2014. The project is supported by Brazilian credit and technology and requires the

import of expensive agricultural machinery and inputs. This and other similar projects

do not reflect a lack of food self-sufficiency but rather the cyclical nature of neoliberal

economic policies and competing international interests. When global food prices are

high and market conditions are good, economically motivated actors within and

outside of Cuba seek to take advantage through large-scale production and exportation.

When conditions are bad, however, Cuba can still rely on its proven agroecological

model to feed its populace. Backsliding toward an agricultural paradigm that

demonstrably failed prior to 1990 may indeed undermine Cuba’s current sustainability,

but it says little about the effectiveness of alternative agriculture in Cuba.

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Transgenics

The Cuban government has committed considerable resources toward research on

genetically modified (GM) crops, including Bt maize,2 which it began testing in 2008.

This is a puzzling and controversial development that appears to contradict Cuba’s

otherwise staunch commitment to agroecology. However, much of the biotechnology

research carried out by Cuba’s Center for Genetic Engineering and Biotechnology

besides Bt maize research focuses on problems that do not yet have agroecological

solutions, such as drought and viral diseases. And while the use of transgenics may or

may not negatively affect Cuba’s long-term agricultural sustainability, in either case it

does not contradict Cuba’s food self-sufficiency. Again, many of the pressures for

transgenic research relate to external market forces and macroeconomic incentives

rather than food security. Agricultural experts and members of the peasant

agroecological sector—the sector largely responsible for feeding the populace—have

called for a moratorium on GM crops, citing a lack of transparency in government

decision making on the matter.3 The government has since acknowledged the various

risks of transgenics and taken steps to strictly regulate GM crops. As a result, the

environment in which transgenics are being studied and used is more conducive to

positive outcomes than other countries. Additionally, Cuba lacks the intellectual

property rights that have allowed for the appropriation and misuse of biotechnologies

by private interests in the U.S. and elsewhere. Transgenic crops may ultimately impede

further agroecological progress in Cuba, but they do not diminish the many known

benefits of Cuban agroecology.

2 Bt maize is a genetically modified variant of maize that produces the insecticide Bacillus Thuringiensis

3 “Cuba’s Transgenic Corn Debate Heats Up.” Havana Times. October 6, 2010.

<http://www.havanatimes.org/?p=30603> Accessed March 20, 2013.

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Conclusion

All told, the Cuban agricultural model necessitated by the collapse of the socialist

bloc represents an invaluable test case, despite its acknowledged imperfections. Cuba’s

success in achieving food self-sufficiency through urban agroecology is unprecedented,

and Cuban agriculture has innate merits that are broadly applicable elsewhere, even if

the circumstances which led to their development in Cuba were unique. The U.S. and

other nations stand to benefit from a transition toward Cuba’s decentralized,

environmentally sustainable, and socially beneficial agricultural paradigm. The full

potential of this new paradigm has yet to be realized, however. Critics who prematurely

denounce its limitations threaten to impede the development of the most promising

alternative to unsustainable industrial agriculture witnessed to date. Cuba has

demonstrated the flaws of conventional agriculture and pointed the way toward a

viable alternative; we should heed its lessons.

References

Altieri, M.A. (2002). Agroecology: the science of natural resource management for poor farmers in marginal environments. Agriculture, Ecosystems and Environment, 93, 1–24.

Altieri, M. A., Companioni, N., Cañizares, K., Murphy, C., Rosset, P., Bourque, M., & Nicholls, C. I. (1999). The greening of the barrios: Urban agriculture for food security in Cuba. Agriculture and Human Values, 16(2), 131-140.

Altieri, M. A., & Funes-Monzote, F. R. (2012). The paradox of Cuban agriculture. Monthly Review, 63(8), 23.

Avery, D. T. (April 2, 2009). Cubans starve on a diet of lies. Retrieved on 1/17/2012 from http://www.cgfi.org/2009/04/cubans-starve-on-diet-of-lies-by-dennis-t-avery/

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Deere, C. D., Perez, N., & Gonzales, E. (1994). The view from below: Cuban agriculture in the "special period in peacetime". The Journal of Peasant Studies, 21(2), 194-234.

Febles-Gonzalez, J. M., Tolón Becerra, A., Lastra-Bravo, X., & Acosta-Valdés, X. (2011). Cuban agricultural policy in the last 25 years. From conventional to organic agriculture. Land Use Policy, 28(4), 723-735.

Funes, F., Altieri, M. A., & Rosset, P. (2009). The Avery diet: The Hudson Institute's misinformation campaign against Cuban agriculture: May.

Hiranandani, V. (2010). Sustainable agriculture in Canada and Cuba: A comparison. Environment, Development and Sustainability, 12(5), 763-775.

Lance, S. (2009). Sustainable agriculture in Cuba. Americas Quarterly, 3(4), 98-99.

Levins, R. (2005). How Cuba is going ecological. Capitalism, Nature, Socialism, 16(3), 7–26.

McKibben, B. (2005). The Cuba diet. Harper's Magazine, 310(1859), 61.

Peter, M. R. (1998). Alternative agriculture works: The case of Cuba. Monthly Review, 50(3), 137.

Pearson, L.J., Pearson, L., & Pearson, C.J. (2010). Sustainable urban agriculture: stocktake and opportunities. International Journal of Agricultural Sustainability, (8)1-2, 7-19

Pretty, J. (2008). Agricultural sustainability: concepts, principles and evidence. Philosophical Transactions of the Royal Society B: Biological Sciences, 363(1491), 447-465.

Rosset, P. (1997). Alternative agriculture and crisis in Cuba. Technology and Society Magazine, IEEE, 16(2), 19-25.

Rosset, P. (2005). Cuba: A successful case study of sustainable agriculture. Environmental Sociology: From Analysis To Action, 430.

Rosset, P., Sosa, B. M., Jaime, A. M. R., & Lozano, D. R. A. (2011). The Campesino-to-Campesino agroecology movement of ANAP in Cuba: Social process methodology in the construction of sustainable peasant agriculture and food sovereignty. The Journal of Peasant Studies, 38(1), 161.

Koont, S. (2004). Food security in Cuba. Monthly Review, 55(8), 11-20.

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Koont, S. (2007). Urban agriculture in Cuba: Of, by, and for the barrio. Nature, Society, and Thought, 20(3/4), 311.

Koont, S. (2009). The urban agriculture of Havana. Monthly Review, 60(8), 44.

Warwick, H. (2001). Cuba's organic revolution. Forum for Applied Research and Public Policy, 16(2), 54-58.

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Cuba’s Next Revolution: A Fight Against the Rise of a Neoliberal Food

Dictatorship

Christina Kehoe

Introduction

Since its socialist inception in 1959, Cuba’s government has provided food rations

to all its citizens (Koont 1992). During these past 54 years, the Cuban government

increasingly relied on import and export trade relations with the Soviet Union to

sustain its agricultural sector (Boillat et al. 2012). However, after the Communist

Common Market’s collapse in 1989, the importation of agricultural inputs and

exportation of cash crops became infeasible. In order to continue to survive

economically and feed its population, Cuba had to make a radical switch from a

modern industrialized food system to a system of low input food production based on

the principles of agroecology. Since then, Cuba has successfully restructured its national

priorities to center on food sovereignty via (1) the use of the ration book “libreta”, (2)

decentralization through agrarian reforms and (3) the continued promotion of

agroecology. Through these approaches, Cuba has enhanced citizen welfare and

livelihoods, reduced economic dependency on imported food inputs and improved

resilience to unpredictable external events.

Despite the apparent success, it is uncertain if Cuba will continue its existing

agricultural model. President Raul Castro is looking to broaden foreign trade

relationships by increasing the integration of the Cuban economy into the global

marketplace (Levy 2013). Can the country’s agroecological movement persist if the

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Cuban economy is opened further to outside market forces? I argue in this paper that in

order to safeguard national food sovereignty, it is imperative that Cuba’s socialist

agricultural policies and promotion of agroecological initiatives continue with limited

integration with foreign markets. The foundation of this argument is that Cuba’s

socialist political structure is in a much better position to achieve national food

sovereignty than capitalist economies.

The paper begins with a brief synopsis of relevant Cuban history, highlighting

major agricultural developments in national policies within the past decade. The next

section discusses food sovereignty definitions and evaluates whether Cuba’s current

socialist system is congruent with food sovereignty principles. The following section

presents a counterargument based on food choice and food security criteria, which

addresses the limitations of the current socialist model and the conjectural need for

increased integration into the global economy. In the last section, I rebut this argument

using logical reasoning and empirical evidence arguing in favor of continued isolation

rather than integration. I recommend that Cuban policy makers who may be enticed by

the large-scale industrialized approach examine the dangers and vulnerabilities of

greater integration into the global marketplace.

Cuba’s Agricultural History: Sugar Cane to Sugar Drain

As far back as the 18th century, Cuba’s economy was dependent on the export of

sugar cane. Despite a complete commercial and diplomatic embargo enacted from the

United States in 1963, sugar has remained the country’s most valuable and traded

commodity (USDA 2008). During the 1980’s, Cuba benefited from exclusive trade deals

with other communist-bloc states, principally the Soviet Union. In exchange for Cuban

sugar exports, the Soviets offered agricultural production inputs: fossil fuels,

agrochemicals and industrial equipment. The exchange between the two countries

secured a seemingly stable market, which motivated Cuban agricultural initiatives to

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amplify industrial production of sugar cane to roughly 2 million hectares of arable land

(Boillat et al. 2012). Logically, Cuba became heavily dependent on the importation

resources given by its communist counterpart.

Cuba’s Soviet import dependency ended in 1989 when the Communist Common

Market collapsed. This collapse plunged Cuba into a five‐year long economic crisis

euphemistically called the “Periodo especial en tiempos de paz” (English: “Special Period

in Peace Time”). According to Funes‐Monzote (2012), Cuba’s GDP fell from $19.3 to

$10.0 billion and total imports were reduced by 75%. The agricultural sector was

particularly hard hit, as availability of agricultural inputs fell severely: importation of

fuel decreased by 33%, fertilizers by 25%, pesticides by 40%, and animal feed

concentrates by 30% (Boilat et al. 2012; p. 603). Furthermore, individual nutrition

jeopardized social welfare as the average person lived on less than 2000 calories a day

(Koont 1992).

Cuba was forced to reconstruct its economic and agricultural systems from the

“dirt” up. Utilizing roughly 50% less imported inputs, the country had to focus on

efficient use of all domestic resources (Boillat et al 2012). Cuba incorporated ecological

and traditional low-input agricultural methods into its alternative system. This new

model focused on principles that apply characteristics of ecosystems into agricultural

planning. Fossil fuel machinery was replaced with oxen teams, fertilizer with manure

and chemical sprays with worm composting (Funes‐Monzote 2006).

The Cuban Path to Food Sovereignty

According to La Via Campesina, food is a basic human right: “Everyone must have

access to safe, nutritious and culturally appropriate food in a sufficient quantity and quality to

sustain a healthy life with full human dignity. Each nation should declare that access to food is a

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constitutional right and guarantee development of the primary sector to ensure the concrete

realization of this fundamental right.” ( La Via Campesina 2013). Mirrored by socialist

principles, food sovereignty principles would dictate that the Cuban government is the

entity most responsible for guaranteeing its citizens’ rights to food (Angus 2008). Over

the past 14 years, Cuba has been able to develop its national policies in line with food

sovereignty precepts. The three primary approaches for achieving food sovereignty are

(1) the use of the ration book “libreta”, (2) decentralization through agrarian reforms

and (3) the continued promotion of agroecology.

Firstly, Cuba’s government has continued rationing its food supply through the

“libreta” system to every household, which consequently improved the livelihoods and

welfare of its citizens. The food rationing system was implemented by Law No.1015 in

March 12, 1962 (Alvarez 2004). Since this time, the Cuban government emphasized the

importance of agriculture for social welfare and the sustainable development of the

island (USDA 2008). By establishing a rationing system, the government provides its

11.2 million Cuban citizens adequate nutrition with a minimum of daily per capita

nutritional figure of 2,600 calories (Koont 2004). Regardless of a person’s social or

economic status, the government supplies and distributes food to all citizens. According

to socialist discourse, this rationing system brings social equity into the system in

addition to feeding the population (Alvarez 2004). The government provides every

Cuban citizen with a minimum food supply no matter what racial or socio-economic

class.

Secondly, the Cuban government has adapted its agricultural capacity by

decentralizing programs through agrarian reforms. Prior to 1989, the Cuban

government owned and managed roughly 75% of all arable land (USDA 2008). After the

Special Period, Cuba realized that its highly centralized model was inefficient in

providing food to all citizens. The Agrarian Reform of 1993, divided large state

enterprises into smaller municipal governing entities and farmer cooperatives

21

(Hagelberg 2009). This created the basis for grassroots democratic management and

local responsibility by “linking people to the land” (Funes‐Monzote, F. 2006 p. 10).

Moreover, part of this reform, Decree‐Law 259, created usufruct rights to 100,000 new

farmers (Hagelberg 2009). The Cuban government still owns the land, however, the

tenants are free to work the land as they please, considering they produce the

government’s specified quota needed to sustain the rationing system.

According to Koont, the Cuban government is heavily invested in the peasant and

agricultural sector as over “200,000 workers were employed in this sector, 35,000 new

jobs having been created over the previous year amounting to 22 percent of all new jobs

in the Cuban economy” (Koont 2004 p. 13). Moreover, the government focuses on

improving farmer livelihoods by offering channels to increase employment and income.

This is realized by allowing the farmers to profit from any crop surplus they have made

above supplying the government quota and feeding their families.

Thirdly, although monoculture and agricultural intensification are still practiced

in Cuba, the country continues to promote agroecological practices. Utilizing this

methodology, Cubans were able to produce more food in 2007 than they did in 1988,

using only 25% of the agrochemicals (Altieri & Funes‐Monzote 2012). The capital city of

Havana has also proven to be a successful case of agroecological production in an urban

context, providing roughly 50% of fruits and vegetables for the population within city

limits (Altieri & Funes‐Monzote 2012). Such accomplishments have made Cuba a global

“agroecological lighthouse” (Altieri & Funes‐Monzote 2012).

Consequently, Cuba has been successful at decreasing its dependency on imported

inputs over the past decade (Funes et. al 2009). Unfortunately, the nation still currently

imports milk, meats, oil and other staple food that the country is currently unable to

provide for its citizens. However, Cuba has reduced its import of vegetables and fruits

22

to roughly 20% in the past few years (Agri-Food Trade Service 2012). From 1996 to 2005

Cuba achieved a 4.2% annual growth in per capita food production compared to the

regional average of 0% (Altieri & Funes‐Monzote 2012). As a result, this reduces Cuba’s

economic dependency on external markets and endorses food sovereignty.

Compared to conventional monoculture systems, Cuban agroecological practices

have proven to reduce the risks associated with unpredictable events. This resilience is

an outgrowth of a focus on agroecology’s structurally varied property layouts. This was

demonstrated when Hurricane Ike trampled the country in 2008; roughly 40% of Cuba’s

agroecological farms became fully operational within the first four months after the

storm’s initial hit. This is a considerable difference from monoculture’s production

return that took on average six months (Patel 2012). Although both Cuba’s monoculture

and agroecology lands were destroyed by two additional hurricanes during the same

year, the agroecological farms maintained higher resilience as productivity only fell by

13% (Rosset 2011). This resilience can be extrapolated to future events such as those

foreseen by climate change models during this century.

Based on these agrarian achievements it seems logical to deduce that Cuba is on

the path of complete food self-sufficiency and national food sovereignty. However, if

this is the case, why has President Castro verbalized integration with foreign food

imports and exports in the forthcoming years? Are there certain inadequacies or

limitations embedded in the socialist government system that limit food sovereignty

thereby necessitating that the Cuban socialist government take another course of action?

Integration in Foreign Neoliberal Markets

Neoliberalism can be defined as a political economic philosophy that asserts the

primacy of the market in attending to human needs (Alkon & Mares 2012). The

backbone of this philosophy is the claim that free market trade will ultimately create

23

more efficient economies with free flow of capital exchanges in which all actors benefit

(Shah 2005). Rather than small‐scale agroecology, neoliberal economies support an

industrial approach; one than advocates intensification and technological advances in

the food system (Dierckxsen 2000). Utilizing neoliberal theory, the following section

will argue points in favor of foreign market integration with a critical analysis of Cuba’s

current agricultural situation. The supporters of the neoliberal perspective would argue

that Cuba’s current socialist polices do not achieve key tenants of food self‐sufficiency

such as food choice and food security.

Food choice is an intrinsic factor in achieving food sovereignty. As the libreta is a

top‐down directive, rationed from the state, Cubans must accept whatever food choices

the government is able to provide at that time. Cubans do not have an adequate say in

their food quantity, quality, frequency nor preferences. In a neoliberal open market, the

citizens would have increased food choice based on their desires and not restricted by

the government (Sodono 2010).

Food security entails that all people have physical and economic access to basic

food at all times (Pinstrup‐Andersen 2009). Advocates of neoliberal reforms contend

that small-scale agroecology cannot sustain long‐term food security (Millan 2011). These

advocates assert that the libreta system is flawed and leads to food insecurity; it is

known to be unpredictable, deficient and limited by the socialist government’s available

resources (McMichael 2005). An advantage of using neoliberal economies is that

consumers’ choices regulate market demand of the food commodity. Subsequently, this

supply and demand economy allocates production efficiently. In a world of limited

resources, neoliberal markets can best integrate Cuban agriculture into the global

markets at the lowest cost and price.

24

Advocates of neoliberal reforms argue that consumers would have cheaper

products from foreign markets due to the comparative advantages that different regions

and production systems can provide. Such advocates also point out the fact that the

country must already import much of its food from other countries, including milk,

meat, soybean oil, powdered milk, corn, powdered milk, and flour (Agri-Food Trade

Service 2012). This suggests the need for further market integration and the benefits that

liberalizing trade could have for Cubans.

On the point of resilience, critics argue that Cuba’s food security would be better

served if it was incorporated into foreign markets. With established foreign trade

relationships, the Cuban government will be less likely to suffer from scarcity due to

environmental events, as food will be provided from more than one source in more

than one location.

Discussion: Isolation not Integration

President Raul Castro took over his brother’s office in 2008. Since then, Cuba’s

leader has made agriculture his top priority, focusing on food sovereignty and

efficiency in the food production system, and dubbing it an issue of “national security”

(Cave 2012). President Raul Castro has stated that the Cuban government’s most

pressing objectives are to reduce costs and inadequacies in country’s agricultural sector

by any means necessary (NY Times 2012). According to Altieri & Funes‐Monzote if all

the peasant, cooperative, and state‐run farms were able to implement agroecological

principles, the island would be food sovereign: “Cuba would be able to produce

enough to feed its population, supply food to the tourist industry, and even export

some food to help generate foreign currency“ (2012 p. 1). Despite Cuba’s agroecological

accomplishments, the Cuban government has hinted at increasing neoliberal market

integration and transformations of the country’s current agricultural system (NY Times

25

2012).

Cuba’s Special Period illustrates how dependency on foreign neoliberal markets

can destroy national food sovereignty as the island nation was left hungry. Though

improved efficiency is a laudable goal, it is highly uncertain if the agrarian

accomplishments and continued success of Cuba’s agroecological movement will

persist if foreign neoliberal markets are given more access into Cuba. Based on past

experiences and current fallacies with the neoliberal marketplace, the Cuban

government should reconsider this notion. In order to safeguard national food

sovereignty, it is imperative that Cuba’s socialist agricultural policies and promotion of

agroecological initiatives continue with negligible involvement with foreign neoliberal

markets. The argument in favor for continued agricultural isolation from the neoliberal

food markets is based on the apparent ineffectiveness of neoliberal markets with

limitations on individual food choice and the further increase of national food

insecurities.

Food choice is limited rather than enhanced in a neoliberal marketplace. In

response to the supposition that socialist policies are a barrier to personal food choice, it

must be asked: for whom does the neoliberal marketplace provide food choice

opportunities? Given that neoliberal market-based economies are the most prevalent

economic system in the world today, they should have theoretically achieved global

food sovereignty. Currently, the global food system produces 1.5 times enough food to

feed the world’s population (Gimenez 2012). Despite this, 925 million people are still

suffering from chronic hunger; it is clear that the dominant neoliberal system is not

working (Callahan 2011). Food is not allocated to those most in need but those with the

financial resources. The neoliberal structure places business profits above human rights

(Stephens 2002). Unlike Cuba’s socialist system that advocates food as a “right for all”,

the neoliberal structure is based on the “rights” of the free market with food supply

allocation directed by the invisible hand rather than the hands of the hungry.

26

Granted, privileged individuals have increased food choices under a neoliberal

system, but those without the adequate finances are not offered the same choices. Food

choice is restricted as production and supply are directed to those consumers who can

afford to pay for the food products. The average Cuban is living on $16.70 wages per

month. This low salary will prove disastrous for Cuban citizens, as they don’t have the

financial capacity to purchase sufficient food supplies (Mesa‐Lagos 2010). Cuba’s

current socialist libreta system ensures that each citizen has a minimal food intake.

Without an overall transformation of the Cuban economic sector, health risks due to

inability to pay will become an issue limiting food sovereignty. With the current libreta

system, the Cuban government was able to supply each citizen with the minimum

nutritional amount needed to survive healthy. Moreover, Cubans still have food choice

opportunities. Utilizing Cuban’s agroecological policies and promotion of household

food production in both rural and urban settings, Cubans can reduce the confines of the

libreta system by choosing which foods they produce.

If Cuba integrated foreign neoliberal markets into its national food policies, it

would create food insecurity rather than security. The neoliberal economy has placed

control of food in the hands of an elite class, the corporate food regime, that are not

concerned with attaining food sovereignty. The responsibilities of the state are siphoned

to multinational corporations, which are not in the market to achieve the altruistic

objective to end hunger. The corporate food regime is comprised of transnational

corporations, institutional structures and informal norms that direct the neoliberal food

system (Otero 2012). The corporate food regime is supply‐driven with control of food

production from seeds to mouths, nearly 70% of corn worldwide is controlled solely by

4 transnational corporations (Source Watch 2012). The corporate food regime does not

consider negative externalities such as environmental costs or social welfare in food

pricing.

27

Cuba’s rural and urban producers, the peasant and cooperative farms, will be

competing against countries such as the United States where production and

distribution methods are highly subsidized (Shmitz 2006). The market pricing itself is

skewed towards subsidized agro-businesses; these corporate food regimes would sell

their products below market price and challenge Cuba’s rural and urban farmers’

livelihoods (USDA 2008). As 20% of Cubans are employed in the agricultural sector,

their living would be jeopardized as cheaper food products may undercut Cuban

produced goods.

As the consequences were witnessed during the Special Period, dependence on

foreign trade can be disastrous. In light of future concerns of fossil fuel scarcity and

climate change, price inflation will become more volatile in an increasing unpredictable

market environment (Altieri & Funes‐Monzote 2012). Cuba’s assimilation into

neoliberal markets would reverse the national agricultural accomplishments it has

made in the past decade and thwart food sovereignty for the future. Although Cuba’s

current socialist system is not without its own internal problems, it is better positioned

to achieve food sovereignty than foreign neoliberal markets. This is evidenced by

support for citizen welfare and livelihoods, decreased economic dependency on

imported inputs and increased resilience to unpredictable events. Cuban policymakers

and governmental officials must not be enticed by corporate food regimes and remain

isolated from these markets. The Cuban government must prioritize socialist principles

and support agroecological principles in order to achieve food sovereignty. This

objective will necessitate the political support from the Cuban government and its

people to continue in isolation, fighting against the threat of the invisible hand.

28

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31

Microdebt: Gender-based Exploitation and Agrarian Crises

Valerie Puleo

Introduction

Microfinance has been touted as the solution to the cycle of poverty. It has been

widely accepted as a vehicle for economic development and female empowerment.

However, there are a number of factors that are largely missing or simplified in the

literature on microfinance and female empowerment. Microfinance coupled with

agrarian reform can be problematic for female empowerment and overall well-being, as

demonstrated by the Andhra Pradesh case study.

Targeting women for microfinance emerged alongside the “women in

development” discourse in the 1970s, as women’s economic status was viewed as “the

foundation on which better social and political status can be built” (Bernasek, 2003).

The ‘women in development’ practitioners perceived of a disconnection between

women’s roles in agriculture and development policies. Microfinance was an attempt

to address this gap. This shift in practice was groundbreaking because women were

previously excluded by formal institutions due to lack of assets (Hunt & Kasynathan,

2001). Microfinance tactics “emphasize market based institutions that provide credit to

poor households to generate new opportunities through self employment” (Morduch,

1999). Microfinance is used as a tool to help the poor escape the cycle of poverty by

providing a small loan so that an entrepreneur can create a profit generating business.

The Grameen model of microfinance uses group lending and joint liability to ensure re-

payment, rather than collateral so that credit is available to the very poor (Morduch,

1999).

32

Mainstream discourse describes the goals of microcredit as employment

generation, poverty reduction, and female empowerment (Mahmud, 2003). The goal is

to create “virtuous spirals” increasing economic empowerment, improving well being,

and fostering social and political empowerment (Mahmud, 2003). While the theory

behind microfinance appears to be sound, there are serious flaws in the design of many

microfinance programs. This paper will address shortcomings in microfinance practice

for agrarian communities, illustrating that microfinance creates unmanageable debt,

excludes the poorest and most vulnerable populations, disrupts community dynamics,

and increases the overall burden on women without increasing control. Agricultural

microfinance programs reinforce unequal power relationships that disrupt community

support networks and exacerbate women’s disempowerment.

Credit and Agriculture: Virtuous Spirals for Female Empowerment

Women are more vulnerable during a crisis or in times of food insecurity than

their male counterparts, and therefore, it is argued that financial resources through

microcredit will help mitigate this discrepancy (Gobezie, 2010). In fact, “if women had

the same access to those resources as men, they would produce 20-30 percent more

food…. [and] food output in developing countries would increase by between 2.5 and

four percent – enough to pull 100-150 million people out of hunger and help achieve

Millennium Development Goal One on hunger and poverty reduction” (FAO 2010-

2011). Microcredit makes it easier for women to purchase costly inputs, and therefore it

helps generate sustainable livelihoods.

Microfinance posits that credit improves a woman’s status in the household and

leads to empowerment (Hunt & Kasynathan, 2001). Al-Amin and Chowdhury (2008)

state that empowerment can encompass many components and is often measured by

mobility, economic security, the ability to make purchases, involvement in decision

making, freedom from domination by the family, political and legal awareness, and

33

participation in public protests. Mahmud (2003) claims that empowerment can be

defined in both absolute and relative terms. Absolute empowerment is indicated by

outcomes that measure literacy/schooling, health/nutrition, labor force participation,

contraceptive use, mobility, ownership of clothing, and assets (Mahmud, 2003).

Relative empowerment describes the process of improving a woman’s position relative

to men within household and indicators include involvement in decision making,

control over household income and assets, and control over loans taken (Mahmud,

2003). A study by Swain and Wallentin in 2009 found that women are empowered by

microfinance because it gives them “a greater propensity to resist existing gender norms

and culture that restrict their ability to develop and make choices” (Swain & Wallentin,

2009).

As part of the obligations of the Grameen Bank model, women must meet in

community groups to receive a range of trainings. During these meetings, women are

given tools that are meant bring them closer to meeting the indicators for empowerment

discussed previously. During the training programs, some of the issues covered

include family law, divorce law, polygamy, and early marriage (Hunt & Kasynathan

2001). This is significant because it exposes women to views outside the family (Hunt &

Kasynathan 2001). Group meetings are important for disseminating agricultural

knowledge as well, because in rural areas many women do not read the news or listen

to the radio, so group meetings facilitate learning about land bunding, biomanure,

seeds, compost pits, commercial vegetable cultivation, and multiple cropping (Kabeer

2005). Hunt and Kasynathan (2001) reveal that of the entire microfinance process,

women value the confidence, knowledge, and training received in the community

groups more than anything else, while men valued the material benefits.

At the household level, microfinance was lauded as a tool for women living under

unequal systems of power to increase their ability to bargain. Gobezie (2010) describes

two main models of the household: the unitary household and the bargaining

household. The unitary model describes different distributions of income as irrelevant.

34

There exists a “household altruist” who ensures that allocation of resources depends on

total income and largely ignores unequal power in the home as well as the potential for

conflict and cooperation among family members (Gobezie, 2010). This is not the reality

for most women. The bargaining model is closer to reality as it incorporates

asymmetrical power relations (Gobezie, 2010). In this case, the household contains self

interested individuals who engage in conflict and cooperation. Microfinance is

important here because it increases a woman’s bargaining power, and therefore,

decreases her vulnerability in the home (Khandker, 2005). A woman’s vulnerability

depends on her bargaining power, and her bargaining power depends on “respective

breakdown/fallback positions, which represents the next best option if cooperation

fails” (Gobezie, 2010). Stronger breakdown position means less vulnerability. In this

way, microfinance has helped women decrease vulnerability. Despite some of the

positive impacts, there are problems. The following section demonstrates the negative

aspects of microfinance in an agrarian community in India.

Case Study: Crisis in Andhra Pradesh

While microfinance has improved the lives of many women and families

worldwide, there are significant issues with the practice in agrarian communities.

Taylor (2011) describes a situation in Andhra Pradesh where microfinance had a

tragically detrimental effect. Andhra Pradesh pursued neoliberal reforms with the

World Bank in the mid-1990s and early 2000s. This meant that subsidies were

discontinued and farmers were forced to adapt to a new way of managing their farms.

Andhra Pradesh reached a crisis state due to two related events in 2006 and 2010. In

2006, farmers began defaulting on loans from microfinance institutions. NGOs

employed “strong arm tactics” to force loan repayment, disrupting communities and

causing the government to place a moratorium on repayment until NGOs self imposed

a code of conduct for their strategies. In 2010, the issue returned when rural borrows

35

began committing suicide because of their inability to pay high debts accrued from

microfinance programs. Institutions were utilizing “aggressive collection strategies

with social stigma and physical coercion” (Taylor, 2011). At the same time, profits

accruing to microfinance institutions were being highlighted in the media. The public

outrage that resulted forced the state to place a moratorium on debt collection once

again.

Repayments for microfinance are weekly and “not compatible with temporalities

of agrarian cash flows” (Taylor, 2011). To cope during times with fewer profits, farmers

were taking loans from one microfinance organization to pay off their debt with another

microfinance organization. The question here is: why would farmers take on more

debt during times of distress? It is not because of fiscal illiteracy or lack of

understanding about interest rates. The plight of smallholders and landless laborers left

microcredit as the only viable option under neoliberal reform conditions. Pressure on

landless laborers is produced by a number of factors. First, expansion of smallholder

agriculture, forced “the majority of rural households to seek social reproduction

through livelihood strategies beyond farming to their own lands” (Taylor, 2011). A

shift toward cash crops and the dependence of farmers on volatile market prices, as

well as the “breakdown of former patronage relationships” and “undermining of

common property resources” also exacerbated this pressure (Taylor, 2011).

Additionally, uncertainty regarding climate, soil, and water depletion and degradation

exacerbated grievances.

Because subsidies decreased and cash crops require costly inputs, there was a

linked crisis of land degradation and indebtedness in Andhra Pradesh. Debts accrued

for land renting, inputs, and borewell drilling, demonstrating the “direct correlation

between cash cropping, failure of borewells, insurmountable debts, and farmer suicides

in regions of northern and western Andhra Pradesh” (Taylor, 2011).

36

Critiques of Microfinance

The crisis in Andhra Pradesh revealed that microfinance programs were

exacerbating agrarian distress for poor farmers. The following sections will address

each of the claims used to support microfinance initiatives and demonstrate that the

benefits of microfinance do not outweigh the costs. Microfinance programs increase

debt, disrupt community dynamics, and increase the overall burden on women.

Microfinance and control over assets

Microfinance increases family debt without increasing women’s control.

Microfinance imposes an extra burden on women because “credit can accentuate the

risks faced by structurally vulnerable population and can proliferate the debt trap”

(Taylor, 2011). Misappropriation of funds and exclusion of some women from

programs occurs because microfinance organizations are focused on quantitative

figures rather than qualitative outcomes (Guerin & Palier, 2006). Staff is pressured to

disburse and recover loans, so they often give larger loans than they should without

analysis of the consequences (Al-Amin & Chowdhury, 2008). Gobezie (2010) declares

that debt is the largest source of stress for rural women in Ethiopia. High interest rates

are justified by high transaction costs, as the profit margin must be very high to make

loans with such ratios profitable (Hofmann & Marius-Gnanou, 2007).

Cultural notions of appropriate input ownership affect the ability of women to

successfully generate agricultural outputs. Women’s ownership of productive assets

such as tractors or irrigation pumps is not socially acceptable (Al-Amin & Chowdhury,

2008). Women’s incomes from agricultural endeavors are turned into household

incomes to be managed by the head of household (generally the male), leaving women

with very little control of family assets (Al-Amin & Chowdhury, 2008). This may result

in increased income for the family, but means very little with unequal power

relationships that exist in the household (Al-Amin & Chowdhury, 2008).

37

Although microfinance institutions claim to loan predominately to women, men

usually control use of the loan while women are tasked with repaying (Al-Amin &

Chowdhury, 2008). The possibility of reinforcing gender inequality is clear. If men

invest poorly, women are responsible for reducing the household consumption due to

cultural norms (Al-Amin & Chowdhury, 2008). A woman’s increased demand for loans

“may be more of a sign of social pressure to access outside resources for in laws or

husbands than empowerment” (Mayoux 2006). Proponents of microfinance for

empowerment claim that loss of control over the loan does not signify a loss of power,

because production decisions are joint ventures (Aslanbeigui Oakes, & Uddin, 2010). At

the same time, with no control over land and family assets, there is very little incentive

for women to invest in productive assets that will generate a profit (Al-Amin &

Chowdhury, 2008).

Group accountability versus collateral requirements

Group accountability utilizes shame as a tool, disrupting women’s support

networks and excluding the most vulnerable. The Grameen model, which emphasizes

group accountability as a means for ensuring repayment of loans, seems like an

innovative option in the absence of collateral requirements. In reality, this means that

women choose members of their groups based on the likelihood of their repayment

(Gobezie, 2010). If one member does not repay her loan, none of the other members are

eligible for a loan. This effectively excludes the poorest, most vulnerable women. In

fact, the “dynamics of joint liability mean that groups screen and self select to form

relatively homogenous groups,” increasing the likelihood that poor, vulnerable

members will be excluded (Gobezie, 2010).

Because women are more vulnerable to shame than men and easier to pressure

into repayment, the group responsibility dynamic utilizes shame to ensure repayment

of loans (Mayoux, 2006). It is no surprise then, that the Grameen Bank does not utilize

collateral but still maintains a 90% repayment rate (Karim, 2008). Because the honor of

38

the family is at stake, repayment is critical (Karim, 2008). Karim (2008) explains that if a

woman does not repay her debt, other women from the group will repossess her capital

to shame her. This involves taking a family’s farm and any other results from her labor

such as rice, grains, animals, and even the family’s home. This tactic destroys

communities to reduce the operating cost for the microfinance NGO. In some cases,

police arrest women for not paying debts, and if a woman is arrested and stays in jail

overnight, she is considered to have lost her honor. Loan recovery techniques are

clearly “entangled in social attitudes toward women” (Karim, 2008). NGOs manipulate

notions of women’s honor and shame and instrumentally violate local norms of

cohesion and community. Rural women’s honor and shame is “instrumentally

appropriated by micro-credit NGOs in welfare of capitalist interests,” resulting in a

“political economy of shame” (Karim, 2008).

Microfinance and gender equality

Microfinance increases the burden on women and reinforces gender inequality.

For cultural reasons, women are expected by their husbands to fulfill family

responsibilities before engaging in microfinance activities. The stipulations required by

microfinance institutions increase the burden on women because, in addition to their

family duties, they must be engaged in group meetings and other activities (Guerin &

Palier, 2006). This may cause tension among relatives as the woman’s time is divided

between her professional and family duties (Guerin & Palier, 2006). Women also have

weak property rights to land, water, and natural resources, which microfinance does

not address. Even with the existence of legislation, there is often weak implementation

and understanding of rights (Quisumbing & Pandolfelli, 2010).

Microfinance and violence

The assumption that “credit by itself will lead to less violence is questionable and

dangerous” and is reflected in the irresponsible practices of large microfinance

providers (Hunt & Kasynathan 2001). Gender inequalities cut across caste, ethnicity,

39

and religion. Consider that in many cultures, it is the male responsibility to protect and

provide for household. An impoverished man’s “failure to fulfill gender ascribed roles

to live up to social expectations about their capacity to protect and provide can lead to

considerable stress and demoralization and domestic violence, high levels of

alcoholism, abandonment of families and responsibilities” (Kabeer 2005). There is

insufficient appreciation of credit and violence link in the development discourse (Hunt

& Kasynathan 2001).

A woman’s family is often likely to spend microfinance money on dowry (Al-

Amin & Chowdhury, 2008) and for this reason, the credit provider becomes an

alternative provider of dowry (Hunt & Kasynathan 2001). For some families, if a wife

does not obtain a loan, she will face violence or tension in the home (Hofmann &

Marius-Gnanou, 2007). It is possible that this is more common than is fully

acknowledged because of “underreporting due to shame or fear that NGO concerned

[may] take up the matter without consent of the woman concerned” (Hunt &

Kasynathan 2001).

Conclusion

The 2010 microfinance crisis in Andhra Pradesh was the result of “severe agrarian

dislocation from impact of trade liberalization, drought cycles, and transformation of

rural social relationships” (Taylor, 2011). The Andhra Pradesh crisis occurred “through

engrained and hierarchical social relationships on the basis of class, caste and gender, in

which debt plays a key role in structuring the appropriation of agrarian surpluses and

in consolidating relationships of domination. The impact of the expansion of

microfinance can only be understood according to the way in which it emerged within

and mediated these relations and processes” (Taylor, 2011).

Microfinance was created as an alternative means of providing credit, and

therefore empowerment, to impoverished individuals who were unable to access loans

40

through traditional banking. Guerin and Palier (2006) state that microfinance is a tool

of neoliberalism that increases the burden on women without providing an increase in

control. The microfinance NGO is “the purveyor of this new economic sovereignty” and

“is an architect of neoliberalism within a modernist developmental discourse of poor

women’s empowerment through the market” (Karim, 2008).

Responsibilities associated with microfinance obligations increase the burden on

women in the household. Access to credit creates a cycle of debt that exacerbates

inequality. Group accountability measures utilize cultural notions of women’s shame

as a tool, causing social distress among communities. Emphasis on fiscal responsibility

over empowerment excludes the poor and re-entrenches caste based differentiation

(Taylor, 2011). Severely impoverished people do not benefit from microfinance because

institutions avoid the risk of financing extremely poor individuals (Hofmann & Marius-

Gnanou, 2007). Focusing on cost recovery and individual lending may reinforce social

exclusion and exacerbate social inequality (Kabeer 2005). While microfinance presents

an opportunity, significant abuses have occurred in the name of female empowerment.

NGOs take advantage of the vulnerability of women to shame and notions of honor to

achieve neoliberal objectives. Microfinance practices have resulted in increased debt

and burdens, disintegration of community relationships, strained familial relationships,

and further disempowerment of women.

References

Al-Amin, M., & Chowdhury, T. (2008). Women, Poverty, and Empowerment: An

Investigation into the Dark Side of Microfinance. Asian Affairs, 30(2), 16-29. Aslanbeigui, N., Oakes, G., & Uddin, N. (2010). Assessing microcredit in Bangladesh: A

critique of the concept of empowerment. Review of political economy, 22(2), 181-204.

41

Bernasek, A. (2003). Banking on social change: Grameen Bank lending to women. International Journal of Politics, Culture, and Society, 16(3), 369-385.

Food and Agriculture Organization (2010-2011). “FAO at Work: Women Key to Food

Security.” http://www.fao.org/docrep/014/am719e/am719e00.pdf Gobezie, G. (2010). Empowerment of Women in Rural Ethiopia: A Review of Two

Microfinance Models. PRAXIS The Fletcher Journal of Human Security, 25. Guerin, I., & Palier, J. (2006). Microfinance and the Empowerment of Women: Will the

Silent Revolution Take Place? 39. Microfinance and Gender: New Contributions to an Old Issue, 27.

Hofmann, E., & Marius-Gnanou, K. (2007). Credit for Women: A Future for Men?

Microfinance and Gender: New Contributions to an Old Issue, 7. Hunt, J., & Kasynathan, N. (2001). Pathways to empowerment? Reflections on

microfinance and transformation in gender relations in South Asia. Gender & Development, 9(1), 42-52.

Kabeer, N. (2005). Is microfinance a 'magic bullet' for women's empowerment? Analysis

of Findings from South Asia. Economic and Political Weekly, 4709-4718. Karim, L. (2008). Demystifying Micro-Credit The Grameen Bank, NGOs, and

Neoliberalism in Bangladesh. Cultural Dynamics, 20(1), 5-29. Khandker, S. R. (2005). Microfinance and poverty: Evidence using panel data from

Bangladesh. The World Bank Economic Review, 19(2), 263-286. Mahmud, S. (2003). Actually how empowering is microcredit? Development and Change,

34(4), 577-605. Mayoux, L. (2006). Not Only Reaching, but also Empowering Women: Ways Forward

for the Next Microfinance Decade. Microfinance and Gender: New Contributions to an Old Issue, 35.

Morduch, J. (1999). The role of subsidies in microfinance: evidence from the Grameen

Bank. Journal of Development Economics, 60(1), 229-248. Quisumbing, A. R., & Pandolfelli, L. (2010). Promising approaches to address the needs

of poor female farmers: Resources, constraints, and interventions. World development, 38(4), 581-592.

42

Swain, R. B., & Wallentin, F. Y. (2009). Does microfinance empower women? Evidence

from self‐help groups in India. International review of applied economics, 23(5), 541-556.

Taylor, M. (2011). ‘Freedom from Poverty is Not for Free’: Rural Development and the

Microfinance Crisis in Andhra Pradesh, India. Journal of Agrarian Change, 11(4), 484-504.

43

The Cotton Conundrum: How Brazil Revealed the Global Governance

Potential of the WTO

Cassie Mullendore

Introduction: The WTO and US Agricultural Subsidies

Since the 1980s, the United States (US) government has been a strong advocate of

economic neoliberalism, a system that minimizes the role of the state and works to give

free markets control over the global economy. It therefore came as no surprise in 1995

when the US and Western Europe led the transformation of the ineffective GATT trade

structure into the World Trade Organization (WTO), an international body designed to

promote trade liberalization and mediate cross-national trade disputes. In short, the

WTO mandate is to open up trade through decreasing tariffs and other trade barriers

while also facilitating trade agreements between countries (WTO 2013). Ironically the

US, which in theory advocates free trade and the reduction of trade barriers, itself

provides large agricultural subsidies to its farmers through a variety of programs,

which originated during the Great Depression. These subsidies not only subvert the free

trade model and WTO rules, but also have profound negative consequences for farmers

in countries whose governments do not provide subsidies to their farmers. Despite this

obvious contradiction, the US has continued spending approximately $20 billion per

year on agricultural subsidies for the past decade (Nixon 2011).

In particular, the US cotton industry has received $24 billion between 2001 and

2011 (Kinnock 2011), an average of $2.4 billion every year. In the 1990s, US exports

accounted for 25% of world cotton trade and by 2005 this number jumped to 40%

44

(Schnepf 2010), highlighting the increasing US cotton presence on the global market and

its ability to affect prices. In 2002, Brazil challenged US domestic cotton subsidies

through the WTO and won a judgment requiring the United States to reform its subsidy

program and compensate Brazilian cotton farmers for their losses. The case represents a

major victory for the Global South in its fight against US agricultural subsidies, though

much work needs to be done in order to move towards a level playing field.

Although the WTO has been criticized for catering to the agricultural needs of

developed countries, the landmark victory of Brazil in its case against US cotton

subsidies demonstrates the global governance potential of the WTO to adhere to its

democratic principles, use its available tools to promote equality and increase the

participation of the Global South and their interests.

Background: Brazil, the US and the Case of Cotton

In 2002, the Brazilian government challenged US agricultural subsidies,

specifically in the cotton sector where Brazilian farmers were being outcompeted by

their subsidy-receiving American counterparts (Schnepf 2010). Brazil argued that the

high US subsidies caused low world market cotton prices and thus limited the ability of

Brazilian cotton farmers to be financially secure (T.B. 2005). Furthermore, the

International Monetary Fund, World Bank and Oxfam “estimate that the end of US

cotton subsidies would lead to a rise in world prices by at least 25 percent” (T.B. 2005).

Brazil sued the US through the WTO Dispute Settlement Body (DSB), claiming that the

extent of US cotton subsidies violated the WTO export subsidy clause, causing a

significant overproduction of cotton, flooding the world market, causing world cotton

prices to fall below the cost of production, and effectively excluding other countries

from the cotton export market (Schnepf 2010).

After two years of deliberations, in 2004 the WTO sided with Brazil, concluding

that U.S. cotton subsidies violated free trade (McClanahan 2012). The WTO found that

45

Brazil’s cotton sector had suffered loses of almost one billion dollars due to US cotton

subsidy practices and required the U.S. to compensate the Latin American giant.

Normally, when a case is decided through the DSB, the punishment is administered in

the form of increased tariffs for the offending country (McClanahan 2012), which would

allow Brazil to impose $829.3 million in trade restrictions against the US (Schnepf 2010).

But in this case, the DSB went a step further. Because of the enormity of the US

violation, Brazil was granted the right to also impose $268.3 million of the total trade

restriction amount in “cross-retaliation” measures (Schnepf 2010). Cross-retaliation is a

rarely used DSB remedy that allows the punishment to cross into other sectors of the

offending country’s economy. In the US-Brazil case, the WTO lifted a number of US

patents, allowing pirated movies and music to be legally used in Brazil as well as a

number of generic pharmaceutical drugs (McClanahan 2012).

For the past decade, the US has scrambled to delay and attenuate the punishment,

reforming its cotton subsidy system and dragging out legal proceedings, resulting in a

delay of the enforcement of the cross-retaliation clause. On the other hand, with the

backing of the DSB, Brazil has continued to aggressively pursue its case, critiquing US

incremental subsidy improvements at every turn. The inclusion of cross-retaliation

penalties has clearly gotten the US’s attention. By 2009, with the backing of the WTO,

Brazil was set to enact trade restrictions and cross-retaliation because of the US’s failure

to sufficiently reform its cotton subsidies. However, the presence of the cross-retaliation

clause spurred the US to take unprecedented steps to protect its private copyrighted

industry. The US responded in 2010 by agreeing to donate $150 million per year to

Brazilian cotton farmers, essentially reallocating a portion of its subsidies in an attempt

to avoid cross-retaliation (McClanahan 2012). In 2012, the case was back in the spotlight

as proposals to reform cotton subsidies and the annual farm bill were casualties of

partisan gridlock in the US Congress (McClanahan 2012). Brazil continues to assert that

the case is nowhere near over and that the cross-retaliation clause can be invoked any

time it deems the US cotton subsidy reforms inadequate.

46

This case sheds light on a number of interesting issues regarding the global

governance possibilities of the WTO. The institution has been roundly criticized by

Global North figures such as Ralph Nader and Global South leaders like Martin Khor

for catering to powerful corporations and wealthy nations while leaving less developed

countries and small farmers in dire economic situations (Turner 2003). However, the

Brazilian challenge and subsequent victory reveal that not all hope is lost; in fact, the

WTO’s commitment to the case and to the use of the cross-retaliation clause

demonstrates its advocacy for trade equity and global democracy.

The WTO: A Potential Equitable Trade

Despite criticism from developing countries for favoring the rich and powerful, its

questionable environmental record, and massive negative publicity associated with the

Seattle riots of 1999, the WTO contains several features that show its promise towards

equitably managing trade, specifically in the agricultural sector. The Brazilian cotton

case provides a concrete case study to complement the theoretical framework from

which the WTO was designed to function democratically. Specifically, the democratic

theory of voting rights and the implementation of the cross-retaliation clause offer

examples of the WTO’s potential to encourage trade equitability.

First, from its inception, the WTO was engineered to be democratic, with a “one

country, one vote” policy (Schott 2000). This charter contrasts with the voting and

power structures of the other Bretton Woods Institutions, the IMF and the World Bank.

In these, the power of more developed countries is explicit and directly linked to

country wealth. Additionally, the goals of the IMF and World Bank align more with

altruistic development and poverty alleviation (at least in theory) than that of the WTO.

On the other hand, the WTO, does not seek development; its goal is the creation and

enforcement of international trade standards that eliminate impediments to free trade

among all member nations. These standards must be fair, democratic, focus only on

47

terms of trade, and applied consistently, regardless of the relative wealth of the

countries. Obviously, countries like the US still wield tremendous power compared to

poor countries, and the institution has failed to deliver all that was promised, especially

with regards to tariffs and subsidies (Alqadhafi 2007). However, the case of Brazil

demonstrates that the WTO can effectively represent the legitimate claims of the Global

South. In so doing, it can encourage other members to challenge unfair trade practices

of established economic powers and come away victorious.

While it may be democratic in theory, is it so in practice? Numerous scholars have

criticized the WTO for favoring developed countries (Lawrence 2007; Alqadhafi 2007).

The fundamental problem is that, no matter how hard the WTO tries to be fair, the

economic wealth and market share of the US and European Union is enormous and

punishments delivered by the DSB may have minimal impacts on such large economies

(Lawrence 2007). Furthermore, less developed countries have been bullied, informally

incentivized, and intimidated into dropping grievances against more powerful member

nations (Alqadhafi 2007). The result is that in the years following the WTO’s inception,

the developed countries filed most of the tribunal disputes: 70.2% in its first five years

(1995-2000) (Lawrence 2007). However, the global market is extremely dynamic and by

the turn of the millennium some Global South nations were emerging as powerful

economic actors. This block of countries is led by four powers dubbed “BRIC”,

consisting of Brazil, Russia, India and China. Additionally, smaller economies such as

Venezuela and Costa Rica have contested the actions of US trade and emerged

victorious, demonstrating that the DSB does not have to be dominated by economies of

scale (Hoekman 2000). Driven by rapidly growing economies and market shares,

between 2001 and 2006 less developed countries accounted for 52.1% of tribunal

disputes (Alqadhafi 2007). While the breakdown by year of DSB data for the past six

years is unavailable, data from 1995-2010 demonstrates that the EU and US represent

the most targeted group of countries and that developing countries win over 56% of

cases that they bring against the two trade giants (Horn 2011).

48

A second WTO tool that proved to be key in the US cotton case is the cross-

retaliation punishment. In the majority of dispute settlements, the WTO grants the right

to impose punishing trade measures (usually tariffs) equivalent to the amount that the

victim country’s economy lost due to the perpetrating country’s trade violation

(McClanahan 2012). Critics of this judicial system are quick to point out that focusing on

tariffs alone when it comes to trade is inadequate because tariffs distort allocation and

are difficult to control (Breuss 2001). From an economic perspective, the retaliation

system is more cost-effective and easier to implement (Breuss 2001). Thus, Brazil was

allowed to impose over $800 million in tariffs against the US, but more importantly,

Brazil was permitted to engage in cross-retaliation, meaning that patent copyrights in

the entertainment and pharmaceutical industries would be lifted (McClanahan 2012).

This cross-retaliation measure has only been granted twice and Brazil is the first

country to impose it (McClanahan 2012). The US has spent millions of dollars and an

entire decade repeatedly appealing the decision, but in every case these appeals have

been rejected by the WTO (Schnepf 2010), revealing the powerful impact that the cross-

retaliation tool can have. The case demonstrates that while tariff-based penalties are

easily absorbed by rich countries, threats to intellectual property touch an entirely more

sensitive nerve. A key difference in that tariffs result in negative consequences for both

producers (due to decreased sales) and consumers (who face higher prices for the same

product) (Kripke 2012). Retaliation, on the other hand, hurts just the producer country

(Kripke 2012) and in the case of US-Brazil, industries such as pharmaceuticals and film,

that are completely unrelated to the cotton sector.

Critiques of the WTO: A Bias Toward the Global North

Critics of the WTO are skeptical about the impact of this case in light of the

ongoing economic dominance of the US and its success in manipulating the market to

its own advantage. Will this judgment and others like it cause the US and EU to act

more responsibly? The Global Exchange, an San Francisco-based advocacy group

49

dedicated to the promotion of human rights and economic justice, believes that the

“WTO was set up to hijack global markets and accrue profits to corporations” (James

2012). In their view, the WTO is structurally incapable of being democratic and its raison

d’etre is to provide the international legal justification for wealthy nations and

multinational corporations to exercise absolute market power. Through a lengthy and

costly court process, developing countries are discouraged from pursuing cases and

protracted appeals to their conclusion. Instead they find themselves forced into

negotiations in informal settings that tend to favor the wealthier nations (James 2012).

Perhaps the Global Exchange’s most compelling argument is the observation that, while

export subsidies are illegal under the WTO mandate, they continue to persist in the EU

and the U.S. (James 2012). If the WTO were really an effective global governance

institution, it wouldn’t require court cases to force the U.S. to change its cotton subsidy

policy; it would be a requirement of WTO membership (James 2012).

The WTO does allow certain kinds of agricultural subsidies, specifically those that

have minimal impact on trade such as research, disease control, infrastructure, food

security and payments that do not stimulate production or ones that actually limit

production (WTO 1994). Problems occur when countries like the US engage in export

subsidies that harm domestic producers through lower global market prices, which is

the situation that Brazil found itself in. In response to WTO guidelines that require

developed countries to reduce their subsidized exports, the US has simply come up

with new ways of providing subsidies through confusing legal terms and complicated

programs (Zarocostas 2010). This subterfuge, according to the International Centre for

Trade and Sustainable Development, doesn’t fool anyone, including the WTO

(Zarocostas 2010), but it is effective at extending the process, delaying judgment and

wearing down their opponents. Meanwhile Brazil’s cotton farmers continue to be faced

with unfair competition.

50

A further structural problem of the WTO is that the nature of the DSB is to settle

disputes between specific countries, rather than merely punishing transgressor

countries. This means that even though Brazil proved that US subsidies had damaged

all cotton exporters, only Brazil receives the compensation awarded, leaving African

cotton exporters out in the cold (Lynn 2010). The clear implication is that the intent of

the WTO’s founders was to promote free trade by providing a forum to resolve trade

disagreements between member countries and prevent bilateral trade wars. Imposing

fair trade practices on all of its members was never the WTO’s mandate. By requiring

formal complaints by one member nation against another and an extended judicial

process, small countries are reluctant to take on large economic powers, even when

their case is just (Zarocostas 2010).

Rebuttal: Increasing Global South Power and Issues of National Sovereignty

While each of these arguments contains some merit, they do not refute the WTO’s

potential as a strong and equitable force for global governance.

First, the claim that the WTO was started in order to “hijack” the global economy

to the benefit of large corporations ignores the power plays between corporations and

the governments that are supposed to control them. Corporations don’t need the WTO

to tilt the economic playing field in their direction: they do this by their very nature.

With so much at stake in international trade, corporate interests will always use their

money to buy access and favor. The best the WTO can do is to make governments

accountable and therefore responsible for their multinational corporations. The power

of agricultural lobbies in the US political system is an obvious problem for free trade. In

fact, from 1995 to 2001 “78% of the US subsidies for cotton went to only 10% of the

farmers” with most of these farmers being employed by giant corporations (Allen 2004).

The simple solution is to change the culture of political lobbying in the US to limit

corporate power, however, corporations could threaten to take their business overseas

51

to more corporate-friendly governments in order to continue receiving subsidies.

Therefore, it is vital that some sort of international body, like the WTO, works to

eliminate safe havens for corporations in order to limit their bargaining power within

political systems.

Second, while a lengthy and potentially costly DSB process can act as a barrier to

its usage, the evidence suggests that the process works. The Brazilian example has

offered encouragement to others, with research in this area pointing to increasing usage

of the DSB by developing countries (Bown 2009). The Brookings Institute research

shows that developing countries are quickly learning how to use the DSB to enhance

their ability to “self-enforce foreign market access” and countries are more likely to

follow in Brazil’s footsteps in order to improve their trade position (Bown 2009).

Additionally, the growing economic power of the BRIC and other emerging economies

provides additional counterweight to the traditional hegemony of the U.S. and EU. As

more member countries become economic players and are willing to challenge

uncompetitive practices, it will become more and more difficult to act unfairly. This

decentralized policing model is facilitated by a key feature of the DSB: the ability for

countries to join grievances as a third party, allowing less developed countries a way to

participate in the tribunal process without having to front the majority of the costs

(Horn 2011). For example, while developing countries have brought 99 direct

complaints to the DSB from 1995-2010, they have also been part of 208 additional cases

by participating as a third party (Horn 2011). This means that third parties can be active

participants in the consultation stage and are able to educate their national

bureaucracies about DSB processes (Horn 2011).

Lastly, the complaint that if the WTO were truly equitable and democratic it

would have put an end to US cotton export subsidies long before Brazil lodged it’s

formal complaint is justified and must be addressed. The WTO cannot be a global

governance mechanism without being an active enforcer of its own rules. In fact, the

52

organization did enact two policies designed to curb agricultural subsidies without

imposing on national sovereignty or increasing domestic food insecurity. At its

inception, the WTO mandated that agricultural subsidies be reformed in developed

countries to exclude export subsides by 2000 (WTO 2000). This goal proved optimistic

and was superseded by the 2000 Agricultural Agreement, which combined strict

mandates with a transition period to give countries the chance to complete the

elimination of unfair trade practices. But this timeline was very aggressive for both the

WTO and its member countries. It was unrealistic to expect that the WTO could

identify, investigate, and correct the unfair trade policies of its members in a few short

years or that democratic countries could enact major policy changes in the same

timeframe. Brazil sued the US in 2002, just two years after the subsidies were supposed

to be reformed, and perhaps not enough time for a large international institution to

properly examine every export subsidy of every developed country.

The WTO does set limits on the annual amount of agricultural subsidies that each

country is allowed for research, disease control and infrastructure (WTO 1994). The US

cap is $19.1 billion and from 1999-2001 the US spent between $21.1 billion and $22.9

billion (Edwards 2002), thus pushing the limits on the cap, but not by an exorbitant

amount when compared to the country’s GDP. By setting these limits and inviting any

country to challenge any violations, the WTO recognizes that while it is a global

governance tool, it cannot impose drastic restrictions on a country’s economy without

treading into issues of national sovereignty. The global economy is dependent on

wealthy nations and although the portfolio is changing to include more emerging

economies, forcing the US or the EU to leave the WTO by imposing draconian penalties

would be counterproductive. In the end, the WTO is a relatively new organization and

despite initial criticism of being too lax on regulations for the US and EU, its democratic

structural framework is providing an effective forum for emerging economies to

participate in the global economy as equals and to insist that all countries play by the

same set of rules.

53

The US-Brazil cotton subsidy case will not change the face of global trade

overnight. But it is a strong step in the right direction for the WTO and for developing

economies because it demonstrates that the organization has the ability to enforce

international trade standards in an equitable manner. So long as free trade is seen as the

path to economic growth and the WTO is viewed as the guarantor of free trade for all, it

retains the potential of becoming an effective global governance body.

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Zarocostas, John (2010). “US: Cotton subsidies burden exporters in poor nations –

study” International Centre for Trade and Sustainable Development. http://ictsd.org/i/press/ictsd-in-the-news/78875/

“WTO says Argentina officially lodged a beef dispute against the US” (2012)

MercoPress South Atlantic News Agency. http://en.mercopress.com/2012/09/01/wto-says-argentina-officially-lodged-a-beef-dispute-against-the-us

“What is the WTO?” (2013) http://wto.org/english/thewto_e/whatis_e/whatis_e.htm GATT/WTO: Agreement on Agriculture (1994)

http://www.wto.org/english/docs_e/legal_e/14-ag.pdf Agriculture: Fairer markets for farmers (2000)

http://www.wto.org/english/thewto_e/whatis_e/tif_e/agrm3_e.htm “WTO to probe US farm subsidies” (2007).

http://news.bbc.co.uk/2/hi/business/7149528.stm

56

SNAP: an Inadequate and Potentially Harmful Food Assistance Strategy in the

United States

Erin Brewster

Introduction

Food insecurity is a persistent issue in many U.S. households, but the primary

government food assistance program has been unsuccessful in comprehensively

addressing the problem. In 2011, the Supplemental Nutrition Assistance Program

(SNAP) was used by 44.7 million people in the United States (Leung et al, 2013),

meaning that that nearly half of children in the U.S. today will have received household

SNAP food assistance at some time by the age of 20 (Gundersen, Kreider, & Pepper,

2011). Many risk factors of high food insecurity are also consequences of long-term

food insecurity, raising the risk of affected individuals becoming trapped in a cycle of

dependence on government assistance programs (Hoefer & Curry, 2012). Without

serious consideration of the program’s deficiencies, the USDA risks continuing to fund

a program which will both fail to adequately address food insecurity and increase the

likelihood of future reliance on government assistance. As currently structured, the

SNAP program is an inadequate strategy to address food security within U.S.

households as it focuses purely on increasing purchasing power while ignoring

environmental factors that affect food access.

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Background

The USDA defines food security as “access by all people at all times to enough

food for an active, healthy life” (Nord, Andrews, & Carlson, 2009, p.2). The explicit

emphasis here is on food access and quantity, but the mention of an “active, healthy

life” implies some underlying basic nutritional quality may be necessary. The Food and

Agriculture Organization of the United Nations (FAO) has a somewhat more

comprehensive definition than the USDA, stating that food security “exists when all

people at all times have both physical and economic access to sufficient, safe and

nutritious food that meets their dietary needs for an active and healthy life” (FAO,

2013). Here it is clear that “access” encompasses both physical and economic factors,

which is important in considering potential barriers to food security. The FAO’s

additional qualification that food should be “nutritious” as well as in sufficient quantity

is key in analyzing the failures of the USDA’s SNAP program in addressing the

problem of food insecurity.

The USDA has developed food and nutrition assistance programs to help reduce

food insecurity among the 14.6% of US households that are food insecure “by providing

low-income households access to food, a healthful diet, and nutrition education” (Nord,

Andrews, & Carlson, 2009, p.iii). Formerly called the Food Stamps Program, the

Supplemental Nutrition Assistance Program (SNAP) is the largest of the USDA-

administered food assistance programs. SNAP provides financial assistance to

qualifying low-income households that have incomes and assets below certain

thresholds, with benefits varying depending on household size and income.

Qualification of households is determined on a monthly basis, and benefits are

administered once-monthly using Electronic Balance Transfer (EBT) cards, which can be

used to purchase a variety of predetermined food items. As such, the SNAP program is

designed to improve food security through increasing the purchasing power of

program participants. However, a review of SNAP reveals that economic assistance

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alone is inadequate to overcome barriers to food access, so even increasing program

spending would only partially address the issue of continuing food insecurity in U.S.

households.

Why SNAP Fails

It is well documented that poor nutrition and health problems such as obesity are

related to poverty and food insecurity. With program beneficiaries generally

consuming nutritionally poor diets, the SNAP program is currently failing to fulfill its

promise of “providing low-income households access to food [and] a healthful diet”

(Nord, Andrews, & Carlson, 2009, p.iii). Even when analyzed under the less stringent

standard of the USDA’s requirements for food security, SNAP benefits are arguably not

providing access to the diet necessary for an “active, healthy life” (Nord, Andrews, &

Carlson, 2009, p.2). Overall, the data suggest that not only is the SNAP program not

improving dietary or nutritional quality for participants, but it may actually have a

negative impact. Food insecure individuals suffer from poor nutrition across the board,

but one study found that 21% of SNAP recipients met none of the national food and

nutrition guidelines as compared with 13% of eligible nonparticipants (Leung et al.,

2012). When corrected for socio-demographic factors and household food security

levels among study participants, differences in dietary intake were quite notable,

including 39% fewer servings of whole grains, 46% more servings of red meat, and,

among women, 71% more servings of regular soda among SNAP participants than

eligible non-participants (Leung et al., 2012). This confirms the results of several earlier

studies which link participation in the SNAP program with an increase in intake of

calories from meats, added sugars, and total fats, while not affecting intake of fruits and

vegetables, total grains, or dairy (Leung et al., 2012; Wilde, McNamara, & Ranney,

2002). The difference in consumption habits between SNAP participants and non-

participants may be at least partially due to a difference in shopping habits; less

59

frequent trips to purchase food among households receiving SNAP benefits may

encourage the purchase of more processed foods (Jilcott, Wall-Bassett, Moore, &

Sharkey, 2011). Clearly, SNAP assistance fails to encourage consumption of healthier

food items while encouraging increased consumption of less healthy items.

This difference in consumption habits may contribute to the negative health

impacts seen among program beneficiaries. One study linked SNAP participation with

increased risk of being overweight for women, with the risk actually increasing along

with food insecurity level, excepting the most extreme levels of food insecurity

(Townsend et al, 2001). Individuals receiving SNAP benefits are more likely to suffer

from obesity than non-participating but eligible individuals (Jilcott, Wall-Bassett,

Moore, & Sharkey, 2011). Some of this disparity may be attributed to the self-selection

effect of lower-income and more food insecure individuals into the program, as many

studies link increased Body Mass Index (BMI) to poverty and food insecurity (Dinour,

Bergen, & Yeh, 2007). The effects and coping strategies related to poverty and food

insecurity have been documented to increase the likelihood of being overweight or

obese (Webb, Schiff, Currivan, & Villamor, 2008), which is likely a contributing factor to

the increased BMI of SNAP users. However, after adjusting for socio-demographic

factors, Webb et al. (2008) found that participation in the SNAP program and not food

insecurity was associated with higher BMI. This suggests that the design of the SNAP

program compounds with existing risk factors and environmental conditions to

negatively influence health and nutritional intake of participants.

The fundamental failing of SNAP is that it focuses solely on economic barriers to

food access and does not consider or address the environmental factors that affect the

availability of food to low-income households. These environmental factors may have

an important effect on food choice and nutritional intake of SNAP participants, but

there is currently no comprehensive initiative within SNAP or other USDA programs to

adequately address these issues. Much of the research on physical barriers to food

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access has focused on so-called “food deserts.” The USDA identifies food deserts as

low-income neighborhoods in which at least 33% of the population has low access to a

full-service grocery store or supermarket, with low access defined as one mile or more

in distance (USDA, 2013). Many SNAP participants live in food deserts under this

definition; the average supermarket distance from a SNAP household is 1.8 miles,

though the average distance to the store most often used is even greater at 4.9 miles

(Ver Ploeg, 2010). While the exact definition and conceptualization of food deserts

varies greatly in the literature, they are generally characterized as poor, urban areas

with limited physical access to supermarkets when compared to wealthier

neighborhoods, and a corresponding increase in the amount of convenience stores and

fast-food restaurants (Walker, Keane, & Burke, 2010). Greater distance to food venues

has been correlated with negative health effects and poorer diets. In urban areas,

several studies have associated increasing risk of obesity and decreased consumption of

fruits and vegetables with increasing distance of households from supermarkets

(Michimi & Wimberly, 2010). This may be partially due to the difficulty or

inconvenience of accessing food venues which are farther away. Increased distance is

compounded by increased difficulties in transportation costs to access supermarkets

farther away from the home for many SNAP recipients (Walker, Keane, & Burke, 2010).

Areas classified as food deserts are often within walking distance of more fast-food

venues and convenience stores, which likely contributes to the increased rates of obesity

(Michimi & Wimberly, 2010). Differences in food access according to income vary not

only in store type, but also in variety and quality of foods available.

Access to foods that meet USDA nutritional standards varies and is correlated to

neighborhood demographics, putting the lower-income neighborhoods of many SNAP

participants at a proportional disadvantage in terms of healthy food access. A survey of

neighborhoods in the U.S. determined that access to foods sufficient to meet USDA

dietary recommendations varies according to both income and race, with lower-income

neighborhoods and minorities having less access than wealthier, white neighborhoods

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(Baker, Schootman, Barnidge, & Kelly, 2006, Krukowski, West, Harvey-Berino, &

Prewitt, 2010). Demographic factors of neighborhoods are demonstrated to affect

availability of healthier foods in food stores, which is important because availability and

store space dedicated to healthier food options has been noted to have an impact on

purchasing habits (Krukowski et al., 2010). Limited food choice also means higher

prices, fewer competing brands, and smaller product container size, which increases

overall cost for the consumer (Walker, Keane, & Burke, 2010). These differences are

important in that they reveal “structural inequalities in the food retail environment”

(Beaulac, Kristjansson, & Cummins, 2009, p. 4), which have a measured effect on food

purchase and consumption habits. The complex interplay between physical and

economic barriers to food access in low-income communities means that economic

assistance alone may be inadequate in compensating for the problem.

While these analyses place an emphasis on measuring access through discrete

distance to food venues and food types, a comprehensive analysis of the effect of food

deserts requires a more nuanced look at the “differential accessibility to healthy and

affordable food” (Beaulac, Kristjansson, & Cummins, 2009, p. 1). Certainly, distance is a

major factor in determining access, but it is not necessarily the best measure of

accessibility, particularly in urban areas. Distance is not always directly related to the

time or expense needed to reach a particular food venue; traffic conditions, access to

public transportation, safety of neighborhoods, and other environmental factors can

strongly impact the costs of travel in terms of both time and money (Leung et al., 2013;

Walker, Keane, & Burke, 2010). For example, even in urban neighborhoods where

healthier food venues are within walking distance, if levels of violent crime are high

enough to deter individuals from walking, car ownership becomes an important factor

in determining household food access (Rose & Richards, 2004). While distance alone

was not always correlated directly to fruit and vegetable intake among SNAP

participants, a more complex analysis of supermarket access that factored in

transportation availability and round-trip travel time showed a link between easier

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market access and increased consumption of both fruits and vegetables (Rose &

Richards, 2004). In this way, food deserts may contribute to “deprivation

amplification” that exacerbates socio-economic disparities faced on the individual level

(Beaulac, Kristjansson, & Cummins, 2009, p. 1). This amplification can negatively affect

the health and nutritional intake of low-income populations, including SNAP

participants. Many of the negative health effects observed among SNAP users can

likely be attributed to this amplification of existing disparities, which are largely

unaddressed by current food assistance strategies.

Why SNAP Claims Success

Despite these noted deficiencies in the program, SNAP has been considered

successful at reducing food insecurity in participating households. While participating

households are generally less food secure than eligible non-participating households,

data suggests that this difference is largely due to self-selection into the program of the

most food insecure households (Nord & Golla, 2009.) In fact, the strongest argument in

favor of the program’s success in reducing food security is the fact that increased

benefits as a result of the American Recovery and Reinvestment Act (ARRA) of 2009

resulted in an increase in food spending and a decrease in measured food insecurity

among eligible households (Nord & Prell, 2011). This demonstrates that targeted

benefit increase among certain income levels could further improve food security, due

to both increased benefits to households already participating and more SNAP-eligible

but previously nonparticipating households electing to receive benefits. Some

increased participation after the 2009 ARRA was determined to be due to a more

favorable cost-benefit calculation on the part of eligible households who must commit

time and sometimes incur incidental costs in the application process in order to receive

benefits (Nord & Prell, 2011). This suggests that while benefit levels may currently be

inadequate, increasing benefits or expanding program access to slightly higher income

63

levels could be sufficient to reduce or eliminate food insecurity of households within

the U.S.

Furthermore, despite the documented existence of food deserts and disparities in

food access among different income levels, most SNAP participants still spend benefits

at large food retailers. Multiple studies demonstrate that an overwhelming percentage

of SNAP-participating households (over 90%) spend their benefits primarily at

supermarkets, despite barriers to physical access such as larger distances (Jilcott, Wall-

Bassett, Moore, & Sharkey, 2011; Rose & Richards, 2004). In fact, 76% of SNAP

participants were considered to have relatively easy access to a supermarket despite

living in low-income communities (Rose & Richards, 2004). This would seem to debunk

the food-desert hypothesis in accounting for differences in food intake, and support the

idea that the primary issues of food access are economic. Indeed, government officials

and other experts have argued that the primary barrier to improving the dietary health

of SNAP recipients is the high cost of nutrient-rich foods such as fruits and vegetables.

Most have suggested that current SNAP benefit levels are inadequate to cover the cost

of healthier foods, and with limited resources, participants naturally chose the cheaper,

less nutritious foods which generally fail to meet even basic USDA nutrition standards

(Leung et al., 2013; Congressional Digest, 2010). Again, it would seem the barrier is

primarily economic and could potentially be addressed through an expansion of

benefits. However, the SNAP program itself may be detrimental to nutritional quality

of its recipients’ diets because of its failure to comprehensively address the underlying

causes of food security.

Why a More Comprehensive Approach is Needed

Research documenting the positive impact of the SNAP program on food security

is flawed because it focuses solely on food quantity as a measure of food security. In

the questionnaire used to gauge food security among households, 9 out of 10 questions

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were about food quantity, with only one mentioning food quality by asking if the

household could “afford to eat balanced meals” (Nord, Andrews, & Carlson, 2009, p. 3).

In fact, the survey pre-supposed that the primary barrier to food access was economic,

as every question used words such as “afford” or “because there wasn’t enough

money” (Nord, Andrews, & Carlson, 2009, p. 3). Not a single question addressed

environmental factors or physical access to food. The assumptions made in the survey

leave significant gaps in the assessment of household barriers to food access. Moreover,

the focus on sufficient quantity while ignoring the nutritional component of food

security has resulted in negative health consequences for SNAP beneficiaries.

The argument against the impact of food deserts oversimplifies the problem of

differential access to food between different socio-demographic groups. Food choice is

often impaired not only due to income, but due to the limited mobility and coping

strategies associated with socio-economic marginalization (Clifton, 2004). While it does

not seem that physical access factors matter much in determining where SNAP

participants shop, it does seem to have a significant effect on their consumption habits,

particularly with regard to fruits and vegetables (Rose & Richards, 2004). More

importantly, transportation access has an affect on shopping frequency and purchasing

habits. Limited car access within a household tends to result in fewer shopping trips

and more bulk purchases, which can have a negative effect on the nutritional quality of

food purchased. Mobility strategies which include public transit or walking are

limiting for households because of both time constraints and limits on the volume of

food that can be reasonably transported (Clifton, 2004). The relationship between

mobility strategies, food access, and purchasing habits is quite complicated, but

demonstrates that the built environment has a strong effect on food access for low-

income households, many of which are SNAP participants.

There are promising signs that the USDA is attempting to analyze and address

some of the more comprehensive barriers to food access. In association with the

65

Department of Health and Human Service, the USDA states that it is attempting to

develop initiatives to increase food access within food deserts by working with food

retailers, distributors, marketers, and producers (USDA Agricultural Marketing Service,

2013). The success of any programs developed will likely depend on how effectively

the USDA’s Economic Research Service identifies barriers to food access. In addition,

the USDA has recently introduced the Food Access Research Atlas to replace its Food

Desert Locator, which includes a measure of household vehicle availability in addition

to distance in measuring supermarket access (USDA, 2013). While this is a promising

first step, it is still not a comprehensive analysis of environmental factors and physical

barriers to food access.

It is also important not to ignore the effect of the structure of the SNAP program

itself on food spending habits. Data suggests that the once-monthly distribution of

SNAP benefits encourages “feast-and-famine” cycles of food purchases for at least a

third of study participants (Jilcott, Wall-Bassett, Moore, & Sharkey, 2011), with benefits

primarily spent within a few days of receipt (Wilde, 2007; Walker, Keane, & Burke,

2010). These sorts of shopping patterns discourage the purchase of perishables in favor

of more shelf-stable processed foods (Jilcott et al., 2011). Numerous solutions to this

structure have been proposed to help mitigate this unintentional effect of the assistance

program. Changing the frequency of current SNAP benefit distribution from once-

monthly to twice-monthly might encourage spending on healthful but more perishable

items like fruits and vegetables (Leung et al, 2013). Encouraging increased availability

of produce in smaller food stores in low-income neighborhoods can help overcome the

complicated environmental factors which affect physical access to fruits and vegetables.

More likely is the need for various forms of pricing intervention to even the playing

field for healthier foods (Michimi & Wimberly, 2010). Pilot programs which gave a

small bonus of $5 to participants who spent at least $5 on fruits and vegetable purchases

were quite successful in increasing the amount of fresh produce consumed by SNAP

66

beneficiaries (Leung et al., 2013). In any case, it is clear that a change in SNAP structure,

rather than a mere increase in benefits, is necessary for the program to achieve its goals.

Conclusion

The structure of the SNAP benefit program, while increasing the quantity of food

consumed, is decreasing the nutritional quality of this food and consequently the health

of its beneficiaries. Its failure in this respect is due to structure-induced behavioral

changes, which compound with environmental factors to limit access to healthier foods.

Without sufficiently addressing physical barriers to food access, increased economic

assistance seems to have the effect of unintentionally discouraging consumption of

more nutritious (but perishable) foods through feast-and-famine cycles of benefit use.

The USDA is making positive steps towards addressing these deficiencies, but it lacks a

comprehensive strategy to address the environmental factors affecting food choice and

access. The SNAP program may be relatively successful at decreasing hunger through

increasing the quantity of food accessible, but it is fundamentally flawed with respect to

addressing food insecurity in terms of nutritional quality and health. Until the

complex, underlying socio-demographic disparities related to food access are

addressed, purely economic assistance programs will not provide more than an increase

in overall caloric intake, and therefore fail to sufficiently improve the food security of

U.S. households.

References

Beaulac, J., Kristjansson, E., & Cummins, S. (2009). A Systematic Review of Food Deserts, 1966-2007. Preventing Chronic Disease, 6(3).

Dinour, L. M., Bergen, D., & Yeh, M. C. (2007). The food insecurity–obesity paradox: a

review of the literature and the role food stamps may play. Journal of the American Dietetic Association, 107(11), 1952-1961.

67

Food Insecurity in the United States. (2010). Congressional Digest, 89(10), 301-306. Gundersen, C., Kreider, B., & Pepper, J. (2011). The Economics of Food Insecurity in the

United States. Applied Economic Perspectives & Policy, 33(3), 281-303. Hoefer, R., & Curry, C. (2012). Food Security and Social Protection in the United States.

Journal of Policy Practice, 11(1/2), 59-76. doi:10.1080/15588742.2011.624062 Jilcott, S. B., Wall-Bassett, E. D., Moore, J. B., & Sharkey, J. R. (2011). Use of Traditional

and Nontraditional Food Venues Among Female Participants in the Supplemental Nutrition Assistance Program (SNAP). Journal of Hunger & Environmental Nutrition, 6(1). 64-74. doi:10.1080/19320248.2011.551028

Leung, C. W., Ding, E. L.,Catalano, P. J, Villamor, E., Rimm, E. B., & Willett, W. C.

(2012). Dietary intake and dietary quality of low-income adults in the Supplemental Nutrition Assistance Program. American Journal of Clinical Nutrition, 96(5), 977. doi:10.3945/ajcn.112.040014

Leung, C. W., Hoffnagle, E.E., Lindsay, A. C., Lofink, H.E., Hoffman, V. A. Turrell, S. &

… Blumenthal, S. J. (2013). A Qualitative Study of Diverse Experts’ Views about Barriers and Strategies to Improve the Diets and Health of Supplemental Nutrition Assistance Program (SNAP) Beneficiaries. Journal of The Academy Of Nutrition & Dietetics, 113(1), 70-76. doi:10.1016/j.jand.2012.09.018

Nord, M., Andrews, M., & Carlson, S. (2009). Household Food Security in the United States,

2008. USDA, Economic Research Service, Economic Research Report No. 83. Nord, M. & Golla, A. (2009). Does SNAP Decrease Food Insecurity? Untangling the Self-

Selection Effect. USDA, Economic Research Service, Economic Research Report No. 85.

Nord, M., & Prell, M. (2011). Food Security of SNAP Recipients Improved Following the

2009 Stimulus Package. Amber Waves: The Economics of Food, Farming, Natural Resources, & Rural America, 9(2), 16-23.

Ratcliffe, C., McKernan, S., & Zhang, S. (2011). How Much Does the Supplemental

Nutrition Assistance Program Reduce Food Insecurity?. American Journal Of Agricultural Economics, 93(4), 1082-1098.

Townsend, M.S., Peerson, J., Love, B., Achterberg, C., & Murphy, S.P. (2001). Food

insecurity is positively related to overweight in women. The Journal of Nutrition, 131(6), 1738-1745.

68

United States Department of Agriculture. (2013). Economic Research Service Food Research Atlas. Retrieved 12 May, 2013 from http://www.ers.usda.gov/data-products/food-access-research-atlas

United States Department of Agriculture Agricultural Marketing Service (2013).

Creating Access to Healthy, Affordable Food. Retrieved 11 May 2013 from http://apps.ams.usda.gov/fooddeserts/AccessHealthyFood.pdf

Ver Ploeg, M. (Ed.). (2010). Access to Affordable and Nutritious Food: Measuring and

Understanding Food Deserts and Their Consequences: Report to Congress. DIANE Publishing

Walker, R. E., Keane, C. R., & Burke, J. G. (2010). Disparities and access to healthy food

in the United States: A review of food deserts literature. Health and Place, 16, 876-884. doi:10.106/j.healthplace.2010.04.013

Webb, A. L., Schiff, A., Currivan, D., & Villamor, E. (2008). Food Stamp Program

participation but not food insecurity is associated with higher adult BMI in Massachusetts residents living in low-income neighbourhoods. Public health nutrition, 11(12), 1248-1255.

Wilde, P.E. (2007). Measuring the effect of food stamps on food insecurity and hunger:

research and policy considerations. Journal of Nutrition, 137: 307-310. Wilde, P. E., McNamara, P. E., & Ranney, C. K. (2002). The Effect on Dietary Quality of

Participation in the Food Stamp and WIC programs (No. 33837). United States Department of Agriculture, Economic Research Service.

69

Food Insecurity in North Korea: Why South Korea Should Take Action on

Food Aid

Hee-Yoon Kim

Introduction

Since its foundation in 1948, the North Korean regime has emphasized the Juche

Ideology of national self-reliance that involves feeding the population as a matter of

national priority (Ahn, 2005). The emphasis on providing food to the North Korean

people is well reflected in an official letter written by Kim Il-Sung in 1956, stating that

“Rice means socialism” (Kim, 1980, p. 29, cited in Kim, 2012). Yet, food security, defined

as a situation where “all people, at all times, have physical and economic access to

sufficient, safe, and nutritious food to meet their dietary needs and food preferences for

a healthy and active life” (World Food Summit, 1996), seems to be far from being

achieved in the country.

The initiation of food insecurity in North Korea dates back to the late 1980s,

however, the situation was remarkably worsened in the mid-1990s (Lee, 2004; Manyin

& Nikitin, 2012). Multiple causes of food insecurity in North Korea include the lack of

arable lands, low fertility soils, use of environmentally unsustainable agriculture

practices, inefficient collective farming schemes, and shortages of external inputs such

as fuel and fertilizers following the collapse of the Soviet Union (Kim et al., 1997;

Noland et al., 2001). When these ongoing unfavorable conditions met crop failures after

disastrous floods in 1995 and 1996, one of the worst famines in the 20th century, which

was termed the Arduous March by the North Korean regime, broke out (Noland et al.

70

2001). Estimates of the death toll during the famine vary according to sources, ranging

from 600,000 to millions (Devereux, 2000; Haggard & Noland, 2007; Lee, 2004; Natsios,

1999; Park, 2012).

The direness of food insecurity during this period led North Korea to open its

door to international food aid for the first time in 1995 (Haggard & Noland, 2009;

Manyin & Nikitin, 2012; Statistics Korea, 2012a). Between 1995 and 2008, large-scale

food aid from South Korea, the United States, and China played a crucial role in

alleviating food shortages and preventing another outbreak of famine in North Korea

(Haggard & Noland, 2009; Manyin & Nikitin, 2012). During these years, the South

Korean government spent 2.18 billion US dollars to assist North Korea, along with 0.8

billion US dollars worth of assistance from its private sector, which included more than

400,000 metric tons of cereal equivalents per year (Statistics Korea, 2012a). The United

States spent 1.3 billion US dollars on assistance to North Korea, and more than half of

the assistance was provided in the form of food aid, adding up to 2,258,164 metric tons

of cereal equivalents by the end of 2009 (Manyin & Nikitin, 2012).

Since 2008, however, food aid to North Korea from South Korea and the United

States has either drastically declined or ceased completely due to deteriorating

diplomatic relations (Haggard & Noland, 2009; Manyin & Nikitin, 2012; Statistics Korea,

2012a). In the meantime, the gap between food demand and supply has remained

unfilled and has been exacerbated by natural disasters such as dry spells and floods

(Haggard & Noland, 2009; FAO/WFP, 2012). The state-run Public Distribution System

(PDS) of quantity rationing in North Korea, which has partially collapsed since the

1990s (Natsios, 1999; Lee, 2004), reduces daily rations in these situations. For instance,

between May to September 2011, the daily ration per person was less than 200 grams of

grains, which is one third of the minimum calorie requirement for people (FAO/WFP,

2012).

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It is rare for North Korean people to live a day without any food intake due the

existence of the PDS, however, the diversity and quantity of food that many are eating

is below standard (FAO/WFP, 2012). The preferential allocations of limited foods to

party cadres, workers in critical fields, and residents in Pyongyang have

disproportionate impacts on the vulnerable populations, who do not have access to

farms or additional incomes to spend on purchasing foods in the black market (Kim,

2008; Natsios, 1999). Desperate endeavors made by those vulnerable populations such

as collecting wild foods and private trading – though restricted – may have been

effective in preventing starvation but fall short of ensuring food security (Haggard &

Noland, 2009). Among 95 households recently investigated by UN agencies, only 7 per

cent considered themselves to be “food secure” (WFP/FAO, 2012). The study also

found that it is common for North Koreans to inflate the size of their meals by adding

water (FAO/WFP, 2012).

It appears that food insecurity in North Korea has been aggravated in recent years

and some scholars foresee possible new famines (see Haggard & Noland, 2009, for

instance). North Korea’s continued requests of food aid show that the government

struggles to feed the population. Rumors of resurging famine-induced cannibalism

have been heard (see Williams, 2013, for instance). When the gap between what North

Korea needs and has is not filled by its domestic production and imports, which are

difficult to achieve due to internal conditions and international sanctions, food aid

becomes the only option left for the vulnerable populations to improve their food

security. Even if food aid was redirected to black markets instead of intended targets,

food aid lowers the price of grains so that people with low purchasing powers can

acquire food (Haggard & Noland, 2009).

While the need for external assistance in North Korea evidently persists (UN

News Centre, 2013), rapidly escalating tensions surrounding the Korean Peninsula have

complicated and politicized the question of providing food aid to North Korea. South

72

Korea is uniquely placed in these relations, not only due to its geographical proximity

and historical relationship with North Korea, but also due to the possibility of

reunification. Here I argue that this unique position compels South Korea to take the

leading role in helping North Korea to alleviate its food insecurity through bilateral

food aid.

Why South Korea Should Step Forward

Humanitarian perspectives

Humanitarian concerns have been consistently raised as a rationale for providing

food aid to North Korea. Deprivation of sufficient food in terms of quantity and

nutritional quality has resulted in the loss of human lives, growth retardation, cessation

of reproduction, and breakaways for survival in North Korea (FAO/WFP, 2012; Pak,

2011; Park, 2012), which are serious violations of human rights. The Ministry of

Unification in South Korea supports the provision of food aid to North Korea as a

necessity for ensuring these basic human rights, with an added emphasis on the spirit

of ethnic community between the two Koreas (Statistics Korea, 2012a).

Establishing a good relationship with North Korea through food aid helps South

Korea make progress on other humanitarian issues, such as the reunion of separated

families and the repatriation of war prisoners or their remains. South Korea, as one of

the top 15 countries in terms of the economy and Human Development Index (UNDP,

2013), has the capacity to offer humanitarian aid to North Korea, the other part of the

Peninsula that has been separated for only six decades and still shares the same

language, culture, and ethnicity. In the late-1990s and early 2000s, for instance, the

relationship between the two Koreas improved while South Korea was pursuing

engagement policies towards North Korea, including stable provisions of food aid. This

led to an emotional meeting of approximately 18,000 separated families in the 2000s

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(Statistics Korea, 2012b). At least for some Koreans, the benefits of this policy certainly

outweighed the costs.

Investments for the future

The youngest generation in North Korea is particularly vulnerable to food

insecurity, along with pregnant or nursing mothers (Lee, 2012). Undernutrition, micro-

nutrient deficiencies, and related health problems are not only causing preventable

deaths but are also hindering the full development of North Korean children (UN News

Centre, 2013). In August 1997, the World Food Program (WFP) conducted research on

child malnutrition in North Korea and confirmed that 16.5 per cent of children studied

are “wasted” and 38.2 per cent of children were “stunted” according to international

growth references (Katona-Apte & Mokdad, 1998). The 2012 national survey revealed

that 28 per cent of children under five are stunted and 4 per cent suffer from acute

malnourishment (UN News Centre, 2013). This kind of chronic exposure to

undernourishment among young people can result in long-term impairment in human

development, including brain functions (Shin, 2000).

Due to the existence of the PDS, which can be effective in preventing deaths by

starvation to some extent, the impacts of famine in North Korea are dispersed into long-

term socioeconomic stresses rather than immediate death surges, which is known as

“slow motion famine” (Lee, 2004). A recent comparative study shows that differences in

the nutritional quality of foods consumed by South and North Koreans are related to

physical differences seen in population averages, especially among those born after

1980 (Pak, 2011). Though the two Koreas share a long history and consist of the same

ethnic groups, differences in physical conditions have become noticeable within only a

few decades, due to the adverse nutritional environment in North Korea (Pak, 2011).

Furthermore, the average life expectancy at birth differs greatly: While South Koreans

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are expected to live up to 80.7 years, North Koreans may live only to 69.0 years (UNDP,

2013).

When differences between South and North Koreans in terms of appearance or life

expctancy are visible, these distinctions may act as a stigma and create a mental barrier

for genuine integration for the young generation when the two Koreas are reunified, as

seen in case of East Germany (see Ahn, 2010) and North Korean defectors in South

Korea. Moreover, if reunification takes place, South Korea will be the one who is likely

to end up paying the reunification cost, since it has far greater economic power and

twice the population of North Korea (CIA, 2013). Therefore, providing assistance to

boost the health and livelihoods of North Koreans now will reduce the shock to South

Korea in the future, as well as the scale of economic, social, and psychological

divergence between the two Koreas.

Promoting Peace on the Korean Peninsula

The recent Korean Peninsula crisis, initiated in December 2012, involves

exacerbated tensions surrounding North Korea, including exchanges of aggressive war

rhetoric and ongoing military posturing. The scale of food aid to North Korea, which

was already significantly dropped since 2008, has been downsized even further in

recent months as a result of the crisis, though the need for a large-scale food aid still

persists (UN News Centre, 2013).

A well-designed food aid program can facilitate the expansion of private markets,

which will be helpful in ensuring food security of vulnerable populations and

undermining the power of the regime (Haggard & Noland, 2011, cited in Manyin &

Nikitin, 2012). Food aid can not only reduce unnecessary losses of human capital but

also promote international cooperation by engaging the recipient country (Manyin,

2005; Manyin & Nikitin, 2012). However, food aid and other types of engagement

75

efforts have been fluctuating according to change of regimes both in the United States

and South Korea (Kim, 2013). This instability has undermined the trust of the North

Korean regime, which had hoped to build new relationships in the post-Cold War (Kim,

2013). In 2008, the South Korean government stepped away from providing food aid,

assuming that isolating North Korea would bring the collapse of the regime (Kim,

2013). However, it resulted in escalations of tensions between the two Koreas, as seen in

the sinking of South Korean Corvett Cheonan in March 2010 and the bormbardment of

Yeongpyeong Island in November 2010, not in the collapse of the North Korean regime

(Kim, 2013).

Maintaining communication channels and basic relations with North Korea to

promote peace on the Korean Peninsula is vital for South Korea, as it is likely to be

endangered the most if armed conflict takes place, due to its geographical proximity

and the unresolved nature of the Korean War. Though South Korea should be the most

interested party in any negotiations for the future of the Korean Peninsula, it has been

relatively neglected in power struggles between big powers such as the United States

and China (Kim, 2013). In this respect, it is necessary for the South Korean regime to

take initiatives and to implement forward-looking policies with North Korea including

building mutual trust by helping North Korea in times of need (Kim, 2013). Food aid is

therefore a strategically effective tool in turning negative peace based on military power

to positive peace with improved relations between two countries (Kim, 2013).

On-going Controversies

North Korea has a history of “regional military provocations, proliferation of

military-related items, long-range missile development, weapons of mass destruction

programs including tests of nuclear devices” (CIA, 2013). Some in South Korea regard

North Korea as “the enemy” and therefore oppose providing any assistance claiming

that it will only support the continuance of the regime. They argue that relations with

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North Korea have not been fundamentally improved despite years of food aid. Others

make the argument that food aid should not be given until measures to secure

transparency are fully implemented. These arguments will be considered in more detail

in the following paragraphs.

Has food aid helped the prolongation of the North Korean regime, which would

have collapsed otherwise? Critics predict that the economic and food crisis in North

Korea will eventually lead to the collapse of the North Korean regime and therefore the

best response to North Korea is suspending assistance (Manyin, 2005). For instance,

severe food insecurity in North Korea has already forced some North Koreans to

migrate in search of food, thus stimulating exchanges of information and weakening the

ideological control of the ruling party (Kim, 2012).

However, it should be also noted that even with the high number of death tolls the

North Korean regime still stays in power, with the help of its distinctive food politics,

which reinforces people to passively comply with propagandas from the early stage of

life (Haggard & Noland, 2009; Kim, 2012; Natsios, 1999). Furthermore, provisions of

food aid by “enemies” like South Korea and the United States weakens the propaganda

of the North Korean regime and promots privatization of the economy (Natsios, 1999).

The failure to ensure an adequate quantity and quality of food to people has been a

threat to the integrity of North Korea since it represents a failure of the regime (Kim,

2012; Natsios, 1999). Cutting-off of food aid may exacerbate food insecurity and

possibly lead to outbreaks of famine, yet ironically, it may serve to the maintenance of

the regime if the scale of the outbreak is restricted at the local level (Park, 2012).

Therefore, that the logic that cutting-off of all assistance including food aid will lead to

the collapse of the North Korean regime has no historical or empirical basis, not to

mention the inhumane nature of its intent of achieving a political goal at the expense of

the mass suffering of North Koreans (Park, 2012).

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Arguments against providing food aid to North Korea often derive from concerns

that it will be used to feed the army, ultimately resulting in the strengthened

militarization of the country. However, considering that the state has prioritized

meeting the military’s food needs regardless of foreign food aid, and the relatively high

self-sufficiency rate of North Korean food production, it is hard to conclude that food

aid will necessarily or disproportionately benefit the military at the expense of society at

large (Kim, 2008; Manyin & Nikitin, 2012). Since the North Korean regime has been

prioritizing the maintenance of its military power over broader economic reforms and

development, it is unlikely that the government will cut back on their military spending

in any case. Also, officials from the WFP and other experts have said that they

witnessed “little to no evidence” that food aid is systemically diverted to the North

Korean military (Manyin & Nikitin, 2012). The military, who are already assured of

their food, will not eat 6 times a day for the fact that they have additional food supplies

from South Korea or other donors, as Choi (2011), a North Korean defector and

journalist, puts it.

It seems impossible for the North Korean regime to dodge criticisms that it should

spend more money on importing food for its people, especially when the ruling party

does not cut its military spending and keeps purchasing luxury items from the Western

world (Becker, 2005) while people are exposed to undernourishment and death by

starvation. The argument here is that provisions of food aid may save the North Korean

government from purchasing food imports and spend the extra cash on additional

military expansions. Nonetheless, not providing food aid will burden ordinary people

who do not farm and do not have access to foreign exchange regardless of causal factors

(Manyin & Nikitin, 2012).

The issue of targeting and monitoring food aid has been a great challenge in North

Korea, where state control is extreme. The North Korean regime has restricted the

monitoring of food aid distributions by donor countries or other authorities and

78

multiple sources have accused the government of siphoning-off food aid to feed its

military (Manyin & Nikitin, 2012). For instance, Haggard and Noland (2005) argue that

up to half of the WFP provisions they tracked failed to reach their intended targets

(Haggard & Noland, 2005). According to a recent survey of North Korean defectors, 29

out of 106 recipients of food aid testified that they were asked to give their share back to

the authorities (Network for North Korean Democracy and Human Rights, 2011, cited

in Lee, 2012). If the provided food aid does not reach the ones in greatest need, would it

be effective for South Korea or any other donors to provide food aid to North Korea?

In fact, the targeting of aid has been almost always imperfect because the cost of

retrieving reliable information is high and allocation decisions take various political and

social factors into consideration (Barrett, 2012). The question that policymakers should

ask is not whether the targeting of aid is precise but whether to provide food aid to

North Korea in the presence of appropriation (Ahn, 2010). Natsios (1999) argues that

food assistance has positive consequences even if the distribution is distorted, which

will be lost if the aid is terminated. According to Natsios (1999), “international food aid

has stimulated private markets, reduced the price of food in the markets by 25-35 per

cent, and undermined central government propaganda concerning South Korea and the

United States” (p.1). On the other hand, the possible costs of prolonged food insecurity

are dire, especially to children and women in vulnerable regions.

For all these reasons, food insecurity in North Korea should be addressed. The

main reason for the South Korean government to intervene in improving North Korea’s

food insecurity lies in the course of its preparation for reunification. Food aid is not only

important in building trust between South and North Korea, but also crucial in splitting

the burden of the reunification cost from the future and reducing the gap between

South and North Koreans in terms of physical health and overall human development

indices. Six decades of separation has resulted in substantial differences, which will

hamper efforts to become one country in the case of reunification. If adequate food aid

79

is provided to North Koreans, and the full capabilities of the North Korean young are

realized, this alone can be a great investment for the future of a unified Korea.

Providing food aid to North Korea is one of the best strategies that South Korea has to

offer for a better future.

Conclusion

North Korean people are suffering from food insecurity, and the situation is

unlikely to be overcome in a short period of time. Even though food aid from South

Korea or any other donor is not a panacea or an ultimate long-term solution for

ensuring food security in North Korea, providing food aid is beneficial for North

Koreans as well as South Koreans. If concerns over targeting remain, it is

recommendable for donor countries such as South Korea or international agencies to

begin by testing with a smaller scale food provision and expand the scale later, as

former Executive Director of the WFP Catherine Bertini has suggested (Lee, 2011).

Providing diversified sources of nutrition such as super cereal, beans, and vitamin and

mineral supplements rather than just rice would be effective for specific populations.

In the long run, North Korea may need improvements and structural adjustments

in their food production system. It is recommended that North Korea should increase

its food production not only in rice but also in beans and fish, revitalize double

cropping wherever available, encourage household garden production and make use of

incentive systems (WFP/FAO, 2012). Another way to prevent acute food shortages is to

improve its food purchasing power in the international market. Given North Korea’s

adverse environmental conditions, it may not be possible for North Korea to be entirely

self-sufficient on food, so this approach makes sense. However, it requires fundamental

changes of policy by the North Korean regime, which does not seem feasible in the near

future.

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Meanwhile, gradual changes brought by amicable steps such as providing food

aid will help to secure the basic human rights and dignity of North Koreans and will

reduce the extent of economic and social divergence that may present challenges during

the eventual reunification of Korea. Though it may be costly and frustrating, South

Korea should step up its food aid. More importantly, South Korea should look forward

to the future in the event that reunification takes place. For South Korea especially,

improving the nutritional status of North Korea does not seem to be merely a matter of

humanitarian assistance. Rather, it is an investment in the future of the Korean

Peninsula.

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