The chaos that derives from the so-called international order can
be painful if you are on the receiving end of the power that determines
that order’s structure. Even tortillas come into play in the ungrand
scheme of things.
Recently, in many regions of Mexico,
tortilla prices jumped by more than 50 per cent. In January, in Mexico
City, tens of thousands of workers and farmers rallied in the Zocalo,
the city’s central square, to protest the skyrocketing cost of
In response, the government of President Felipe
Calderon cut a deal with Mexican producers and retailers to limit the
price of tortillas and corn flour, very likely a temporary expedient.
part the price-hike threat to the food staple for Mexican workers and
the poor is what we might call the ethanol effect — a consequence of
the US stampede to corn-based ethanol as an energy substitute for oil,
whose major wellsprings, of course, are in regions that even more
grievously defy international order.
In the United States,
too, the ethanol effect has raised food prices over a broad range,
including other crops, livestock and poultry.
between instability in the Middle East and the cost of feeding a family
in the Americas isn’t direct, of course. But as with all international
trade, power tilts the balance. A leading goal of US foreign policy has
long been to create a global order in which US corporations have free
access to markets, resources and investment opportunities. The
objective is commonly called "free trade," a posture that collapses
quickly on examination.
It’s not unlike what Britain, a
predecessor in world domination, imagined during the latter part of the
19th century, when it embraced free trade, after 150 years of state
intervention and violence had helped the nation achieve far greater
industrial power than any rival.
The United States has
followed much the same pattern. Generally, great powers are willing to
enter into some limited degree of free trade when they’re convinced
that the economic interests under their protection are going to do
well. That has been, and remains, a primary feature of the
The ethanol boom fits the pattern. As
discussed by agricultural economists C Ford Runge and Benjamin Senauer
in the current issue of Foreign Affairs, "the biofuel industry has long
been dominated not by market forces but by politics and the interests
of a few large companies," in large part Archer Daniels Midland, the
major ethanol producer. Ethanol production is feasible thanks to
substantial state subsidies and very high tariffs to exclude much
cheaper and more efficient sugar-based Brazilian ethanol.
March, during President Bush’s trip to Latin America, the one heralded
achievement was a deal with Brazil on joint production of ethanol. But
Bush, while spouting free-trade rhetoric for others in the conventional
manner, emphasized forcefully that the high tariff to protect US
producers would remain, of course along with the many forms of
government subsidy for the industry.
Despite the huge,
taxpayer-supported agricultural subsidies, the prices of corn — and
tortillas — have been climbing rapidly. One factor is that industrial
users of imported US corn increasingly purchase cheaper Mexican
varieties used for tortillas, raising prices.
US-sponsored NAFTA agreement may also play a significant role, one that
is likely to increase. An unlevel-playing-field impact of NAFTA was to
flood Mexico with highly subsidised agribusiness exports, driving
Mexican producers off the land.
Mexican economist Carlos
Salas reviews data showing that after a steady rise until 1993,
agricultural employment began to decline when NAFTA came into force,
primarily among corn producers — a direct consequence of NAFTA, he and
other economists conclude. One-sixth of the Mexican agricultural work
force has been displaced in the NAFTA years, a process that is
continuing, depressing wages in other sectors of the economy and
impelling emigration to the United States. Max Correa,
secretary-general of the group Central Campesina Cardenista, estimates
that "for every five tons bought from foreign producers, one campesino
becomes a candidate for migration."
It is, presumably, more
than coincidental that President Clinton militarised the Mexican
border, previously quite open, in 1994, along with implementation of
The "free trade" regime drives Mexico from
self-sufficiency in food towards dependency on US exports. And as the
price of corn goes up in the United States, stimulated by corporate
power and state intervention, one can anticipate that the price of
staples may continue its sharp rise in Mexico.
biofuels are likely to "starve the poor" around the world, according to
Runge and Senauer, as staples are converted to ethanol production for
the privileged — cassava in sub-Saharan Africa, to take one ominous
example. Meanwhile, in Southeast Asia, tropical forests are cleared and
burned for oil palms destined for biofuel, and there are threatening
environmental effects from input-rich production of corn-based ethanol
in the United States as well.
The high price of tortillas and
other, crueler vagaries of the international order illustrate the
interconnectedness of events, from the Middle East to the Middle West,
and the urgency of establishing trade based on true democratic
agreements among people, and not interests whose principal hunger is
for profit for corporate interests protected and subsidised by the
state they largely dominate, whatever the human cost.