Buttel, Frederick - H, Philip David McMichael - New Directions in The Sociology of Global Development

CONTENTS
LIST OF CONTRIBUTORS vii

EDITORIAL ADVISORY BOARD ix
DEDICATION: TO FREDERICK H. BUTTEL xi
PART I: NEW RESEARCH AGENDAS IN THE ERA OF

GLOBAL DEVELOPMENT
NEW DIRECTIONS IN COMMODITY CHAIN

ANALYSIS OF GLOBAL DEVELOPMENT PROCESSES
Jane L. Collins 3
TRANS-LOCAL AND TRANS-REGIONAL

SOCIO-ECONOMIC STRUCTURES IN GLOBAL
DEVELOPMENT: A HORIZONTAL PERSPECTIVE
Sandra Halperin 19
CHANGING RURAL SCENARIOS AND RESEARCH

AGENDAS IN LATIN AMERICA IN THE NEW
CENTURY
Norman Long and Bryan Roberts 57
CONQUERING, COMPRADOR, OR COMPETITIVE:

THE NATIONAL BOURGEOISIE IN THE
DEVELOPING WORLD
Andrew Schrank
91
PART II: GLOBAL DEVELOPMENT AND POLICY
QUESTIONS
WHAT IS FOOD AND FARMING FOR? THE
(RE)EMERGENCE OF HEALTH AS A KEY POLICY
DRIVER
Tim Lang 123
v
vi CONTENTS
PROMOTING SUSTAINABLE DEVELOPMENT:

THE QUESTION OF GOVERNANCE
Geoffrey Lawrence 145
STATELESS REGULATION AND CONSUMER

PRESSURE: HISTORICAL EXPERIENCES OF
TRANSNATIONAL CORPORATE MONITORING
Gay Seidman 175
PART III: STRATEGIC QUESTIONS AND GLOBAL

DEVELOPMENTS
THE POVERTY OF RESOURCE EXTRACTION

Stephen G. Bunker 211
FROM COLONIALISM TO GREEN CAPITALISM:

SOCIAL MOVEMENTS AND EMERGENCE OF FOOD
REGIMES
Harriet Friedmann 227
GLOBAL DEVELOPMENT AND THE CORPORATE

FOOD REGIME
Philip McMichael 265
SHIFTING STRATEGIES OF SOVEREIGNTY:

BRAZIL AND THE POLITICS OF GLOBALIZATION
Sara Schoonmaker 301
LIST OF CONTRIBUTORS
Stephen G. Bunkery Department of Sociology, University of

Wisconsin, Madison, WI, USA
Jane L. Collins Department of Rural Sociology and Womens
Studies, University of Wisconsin, Madison, WI,
USA
Harriet Friedmann Department of Sociology, University of
Toronto, Centre for International Studies,
Toronto, ON, Canada
Sandra Halperin Department of International Relations and
Politics, University of Sussex, UK
Tim Lang Department of Health Management & Food
Policy, Institute of Health Sciences, City
University, London, UK
Geoffrey Lawrence School of Social Science, University of
Queensland, Queensland, Australia
Norman Long Department of Rural Development Sociology,
Wageningen University, The Netherlands
Philip McMichael Department of Development Sociology, Cornell
University, NY, USA
Bryan R. Roberts Department of Sociology, University of Texas
at Austin, Austin, TX, USA
Andrew Schrank Department of Sociology, University of New
Mexico, NM, USA
Sara Schoonmaker Department of Sociology and Anthropology,
University of Redlands, CA, USA
Gay Seidman Department of Sociology, University of
Wisconsin-Madison, Madison, WI, USA
vii
EDITORIAL ADVISORY BOARD
Norman Long Wageningen University, Wageningen,

Netherlands (International Rural Sociology
Association)
Max Pfeffer Cornell University, USA (Rural Sociological
Society)
Hilary Tovey Trinity College, Dublin, Ireland (European
Society for Rural Sociology)
Frank Vanclay University of Tasmania, Australia
(International Rural Sociology Association)
ix
DEDICATION:
TO FREDERICK H. BUTTELy
This edition of Research in Rural Sociology and Development is dedicated to

Frederick H. Buttel, who edited the series from 2002 to 2005. Knowing that
he was terminally ill, Fred asked me in the summer of 2003 to co-edit this
particular volume. He died in January 2005, unable to see the project
through to its completion. Nevertheless, the volume bears the stamp of
Freds clear vision. It grew out of a symposium Fred organized at the XI
World Congress for Rural Sociology in Trondheim, July 2004. He named
that symposium New Directions in the Sociology of Global Development.
Chapters in this volume include papers presented at that symposium, com-
plemented by an additional selection of outstanding papers we commis-
sioned. Together, these chapters constitute a tting memorial to Freds
unparalleled breadth of contribution to the sociology of development.
Frederick H. Buttel was the William H. Sewell Professor of Rural So-
ciology, and Professor of Environmental Studies, at the University of
Wisconsin, Madison. He was also Co-Director of the Program on Agricul-
tural Technology Studies at UW-Madison, Chair of the Development Stud-
ies Program, and a Senior Fellow at the Center of World Affairs and the
Global Economy. Elected a Fellow of the American Association for the
Advancement of Science (AAAS) in 1987, he was also Past President of the
Rural Sociological Society, of the Agriculture, Food and Human Values
Society, of the Environment and Society Research Committee (RC24) of the
International Sociological Association and former Chair of the Section on
Environment and Technology of the American Sociological Association.
Co-editor of the journal Society and Natural Resources, Fred also sat on
numerous editorial boards of a range of other professional journals. He co-
authored Environment, Energy and Society: Toward a New Synthesis (2002),
The Sociology of Agriculture (1990), and Los Movimientos Ecologistas
(1984); and co-edited several books, including The Rural Sociology of the
Advanced Societies (1980), Labor and the Environment (1984), Towards a
New Political Economy of Agriculture (1991), Hungry for Profit: The Agri-
business Threat to Farmers, Food and the Environment (2000), Environment
xi
xii DEDICATION
and Global Modernity (2000), Sociological Theory and the Environment

(2002), The Environmental State Under Pressure (2002), and Environment,
Energy and Society: Exemplary Works (2003).
While Freds scholarly output and professional engagement was unusu-
ally prodigious, it is noteworthy that he accomplished much of this while
battling ill-health for more than a decade. Nevertheless, during this time he
remained steadfastly committed to his personal vision of public social sci-
ence. His engagement with his craft, his colleagues, his students, and citizens
and farmers within the realm of his applied research, was exemplary, and
was recognized as such at a day-long, well-attended Festschrift at the August
2004 meetings of the Rural Sociological Society in Sacramento. Fred was in
attendance, to hear colleagues and ex-students speak to his substantial and
outstanding contributions to three areas of research: sociology of agricul-
ture, sociology of the environment, and technology and society. Most of all,
they spoke of his remarkable intellectual insight, and foresight, namely, his
ability to spot emerging social trends, and his ability to identify and link
intellectual currents whether in the literature or in his colleagues. He had
an uncanny ability to match colleagues whose work was either complemen-
tary or convergent, and in doing so, to strengthen their own contributions to
public social science. This volume bears witness to Freds dedication to
nurturing new research among his colleagues, and so we, his colleagues,
dedicate this volume to his extraordinary life.
Philip McMichael
Ithaca, New York
NEW DIRECTIONS IN COMMODITY
CHAIN ANALYSIS OF GLOBAL
DEVELOPMENT PROCESSES
Jane L. Collins
ABSTRACT
While some researchers have considered commodity chain analysis to be a

tool or method that is innocent of theory, or can be combined with any
theory, this paper argues that it has a specific set of theoretical invest-
ments. It argues that commodity chain analysis emerged in response to
criticisms of the determinism, economism, and western bias in earlier
development paradigms. Drawing on recent scholarship, it argues that
researchers have turned to the study of commodity chains to provide
situated and contingent accounts of global political economy that are
historically specific, sensitive to culture and meaning, and attentive to
subaltern perspectives.
INTRODUCTION: A METHOD WITHOUT A THEORY?
Commodity chains have always been central to development discourse.

Colonial relationships were structured around the ow of sugar and coffee,
spices and bananas, and of course, slaves. Early theories of dependency and
New Directions in the Sociology of Global Development

Research in Rural Sociology and Development, Volume 11, 317
Copyright r 2005 by Elsevier Ltd.
All rights of reproduction in any form reserved
ISSN: 1057-1922/doi:10.1016/S1057-1922(05)11001-4
3
4 JANE L. COLLINS
underdevelopment took the unequal terms of these commodity exchanges,

and their legacy in the post-colonial period, to be a key factor explaining the
distribution of poverty and underdevelopment in the 20th century. In these
early formulations, theorists embedded their discussions of commodities
and commodity chains within broader frameworks of class struggle or world
systems dynamics. In the 1980s, this changed, however. As post-modern
theories and the end of the Cold War posed challenges to these large par-
adigms, some scholars began to embrace the study of commodity chains as a
methodological strategy that permitted them to continue empirical work
despite loosened theoretical moorings. They sought to disentangle the ap-
proach from the theories that had structured its inquiries in the past.
At times, researchers argued that commodity chain analysis was a method
or approach that was innocent of theory. For example, Phillip Raikes and
his colleagues, speaking of the French filie`res tradition, claimed that it is seen
by many adherents as a neutral and purely empirical category. They also
described it as less a theory than a meso-level eld of analysis (Raikes,
Jensen, & Ponte, 2000, p. 2). Researchers who sought to dis-embed com-
modity chain analysis from theory referred to it as an approach, an an-
alytical tendency, a heuristic tool, a framework, and a model. Many
who turned to commodity chain analysis as a data-gathering strategy argued
that it was well suited to capturing the complex transactions of an era of
globalization and corporate domination of agriculture. For example, Bill
Friedland (1984, p. 223) suggested that it was a method that made sense at a
time when diversied farming was giving way to specialty production of
particular crops or animals. Others held that, with the declining relevance of
national accounts data for understanding trade and economic policy, the
commodity chain provided a way to encompass the array of actors and
institutions involved in what Harriet Friedmann (1993, p. 52) has called
private global regulation. As an analytical tool that did not begin with a
presumption that states or particular institutions would be key actors, they
argued that it could grasp the evolving organizational aspects of international
trade, the linkages that animate it, the coordination that makes it possible,
and the new global bodies that regulate it.
These claims created an image of commodity chain analysis as innocent
of, or untouched by, theory. Yet, in a related way, some scholars have
suggested that it has an opposite tendency to promiscuously consort with
theories of any origin. It could be argued that the method has provided a
haven where researchers from disparate paradigms meet and a free space for
mixing and matching different theoretical traditions. Friedland (1984,
p. 222) has observed that while his version of the method which he calls
New Directions in Commodity Chain Analysis 5
commodity systems analysis owes much to neo-Marxist labor process

paradigms, it also had honorable antecedents in [the] mainstream func-
tionalism [of] industrial sociology. Other researchers, like Jane Dixon
(1999) or Peter Jackson (1999), have sought to combine political economic
analysis with the study of meaning and cultural value along the commodity
chain. A cursory review of studies from the 1980s to the present that have
used commodity chain analysis reveals that researchers have combined it
with the following theoretical frameworks: institutionalist economics, busi-
ness theories of competitive advantage, labor process studies, regulation
theory, convention theory, actor network theory, political economy of
development or agriculture, world systems theory, dependency theory,
transaction cost approaches, neo-Marxism, network analysis, social con-
structionism, and industrial upgrading.
This paper has a primary and a subsidiary purpose. The rst is to address
the question: does commodity chain analysis have a theory? But to
answer this question, it will digress to explore the historiographic puzzle of
why commodity chains became so popular in the late 20th and early 21st
century. The evidence suggests that the analysis of commodity chains helped
researchers to resolve, at least provisionally, some deep issues facing mod-
ernist development theory. Observing these theoretical maneuvers suggests
that the method can never be innocent of theory, that researchers have
deployed it most effectively in concert with highly sophisticated theory, and
that there are ways to do so that are responsive to critiques of modernist
development paradigms.
COMMODITY CHAIN ANALYSIS AND THE CRISIS

OF DEVELOPMENT THEORY
The rise in the fortunes of commodity chain analysis in the 1980s coincided
with a widespread critique of development as a practice and of development
theory as an ideology. Fueled by new post-structuralist approaches in the
humanities and social sciences, and by the beginning of the end of the Cold
War, critics expressed skepticism about all grand theories of everything, but
especially about those that celebrated and promulgated western models of
progress. These critics took development theory, both neo-classical and
marxist, to task for its economism, its determinism, and its western bias.
The force of these critiques left many development scholars casting about
for ways to do research that addressed social and economic change that were
6 JANE L. COLLINS
not implicated in economism and determinism, did not reify capital and its
processes, and did not make western hegemony seem inevitable. As Lourdes
Gouveia poignantly formulated the question: how far can we carry our
rejection of all attempts to delineate the contours of a social epoch? Can we
avoid exaggerating the solidity of our social structuresyand still speakyof
relatively durable macro-institutional arrangementsy? (1997, p. 306). Many
researchers saw commodity chain analysis, at least initially, as offering an
alternative to a modernist development theory one that dealt with rela-
tively durable macro-structural arrangements but that provided more room
for contingency and agency as well as for discourse and culture.
Jane Dixon has explicitly suggested that the analysis of commodity chains
offers a way out of the impasse created by the critique of development.
She has argued that it can be adapted to post-modern theoretical perspec-
tives because it demands an actor orientation and is context and case
specific. She suggested that it is consistent with a social constructionist
approach and amenable to discussions of consumers and others respon-
sible for the commoditys social life. (1999, p. 151). In a similar way, Watts
and Goodman (1997, p. 13) have noted that commodity chain research
avoids the grand generalities associated with discourses of development and
globalization by focusing on distinct commodity-specific or sectoral dy-
namics, and by highlighting what Laura Raynolds and others have called
the multiple trajectories associated with agrarian internationalization.
Goodman and DuPuis (2002, p. 13) have asked whether the method might
be amenable to the analysis of culture and consumption, and while they
remain critical of the degree to which it has incorporated such analysis to
date, they point to its potential for looking at the life of things in society, a
life that goes beyond the fetishized sphere of exchangeyto the reproductive
world in which things gain other meanings. So to what extent can com-
modity chain analysis bear the weight of these expectations? And, more
specifically, how do researchers see it as resolving the three specific criticisms
of development theory mentioned above?
COMMODITY CHAIN ANALYSIS AND

DETERMINISM
Critics of development theory frequently have pointed to its reliance on a
totalizing logic of capital accumulation that spreads over and colonizes
spaces. Julie Graham and Katherine Gibson (GibsonGraham, 1996)
give us a somewhat more poetic version of this claim when they refer to
capitalism as the heroic/tranformative agent of development and moder-

nity; ythe phallus that structures social space and confers meaning upon
social practices and positions. The questions these critics raise are about
the way in which certain patterns of change appear inevitable in develop-
ment discourse, in which the activities of different spheres appear to be
functionally integrated, and in which the space for innovation, resistance or
counter-hegemonic practice is limited or absent altogether.
Even at the pinnacle of political economys prestige in the sociology of
development and sociology of agriculture, researchers who studied com-
modity chains were always somewhat aberrant in the detailed nature of their
accounts of world system dynamics. In their early accounts of California
lettuce and tomato commodity chains, Friedland and his collaborators, for
example, laid out a Marxist labor process framework. They dened the key
categories of mode of production, social relations of production, and the
technical division of labor. Then they said that having set the stage they
would move on to a more concrete analysis of agriculture. It is at this point
that Friedland elaborates his well-known ve foci for commodity systems
analysis: production practices, grower organizations, labor markets, science,
and marketing and distribution systems. The story that these authors pro-
duced, about the complicity between growers and the state in structuring
immigration from Mexico to the U.S. through the bracero program and the
delicate interplay between new technologies and the supply of labor, was not
abstract and determinist, but deeply historical and aware of political con-
tingency (Friedland & Barton, 1975; Friedland, Barton, & Thomas, 1981).
Similarly, Heffernan and Constance, working on the U.S. poultry com-
modity chain in the 1980s, discussed the actions and interests of specific
transnational corporations, including Cargill, Tyson, and Mitsubishi. They
traced mergers and acquisitions, interconnections between rms, and chang-
ing patterns of vertical integration. The actions of these rms are not pre-
sented as the unfolding of an inevitable trajectory of expansion and
accumulation, but as a process driven by named actors, and one that could
be derailed by contingencies such as diminished fossil fuel availability, na-
tional policies of food security, or new forms of global regulation. (1994).
More recent proponents of commodity chain research have argued explicitly
that it provides an alternative to the totalizing frameworks of development
theory. For Geref and Korzeniewicz (1994, p. 4) this is because commodity
chains are embedded in time and space, and analyzing them demands attention
to the organizational context. In a recent article, Friedland (2001) has sug-
gested that this is because commodities are linked to the mid-range concept of
communities, dened both spatially and functionally, and thus require analysis
8 JANE L. COLLINS
of local social institutions. Watts and Goodman (1997, p. 15) have credited the
study of commodity chains with offering opportunities to explore the role of
technology, the mediations of the state and the agency of individual actors. In
general, proponents have suggested that focusing on commodity chains pro-
vides an alternative to development theorys xation with production, an
antidote to our tendency to see power as owing in only direction, and a cure
for our willingness to attribute change to abstract forces (like globalization or
dependency) that have no faces or addresses.
Two examples suggest how researchers have used the study of commodity
chains to build contingency, specicity and multiplicity into their accounts.
In a widely read edited volume on commodity chains that appeared in 1994,
Gary Geref, while operating within what is nominally a world systems
perspective, has argued for jettisoning concepts of national development
and industrialization and replacing them with more open-ended accounts of
the networking activities of rms and the competitive dynamics of sectors.
Focusing on the global apparel industry, he has created a network-centered
and historical approach that probes above and below the level of the nation-
state to better analyze structure and change in the world economy.
Borrowing concepts from institutionalist economics and economic soci-
ology, Geref has focused on strategies of industrial upgrading that explore
how developing nations where the least profitable parts of commodity
chains have historically been located might capture more profitable
nodes. He examines how corporations construct networks to improve their
position within commodity chains and how those who gain control over
certain nodes in the chain become lead rms that drive the entire industry
or sector. Mapping these strategies and their changes over time, Geref
(1994) creates an account of development process that includes both state
and corporate actors, is highly contingent and contested, and that captures
what he calls the microfoundations of internationalizing trade networks.
In a similar way, Harriet Friedmann (1978, 1993) has used the tools of
regulation theory to describe the construction of the world grain trade in the
post-World War II period. Regulation theory as an intellectual project has
emphasized the multiple, and historically specific, forms of capitalist accu-
mulation. In the words of John Wilkinson (1997, p. 311), it is indebted to the
Annales school of history, toyinstitutional analyses of political science and
law, to Bourdieus concepts of habitus and eld and to the social science
analysis of corporatism and procedures of coordination. Friedman draws on
its premises to construct her concept of the food regime, which she uses to link
international relations of food production and consumption to forms of ac-
cumulation. As Dixon (1999, p. 152) has said, Friedmanns concept of food
regimes stands alone, within political economy, in acknowledging gendered

consumer practices and norms of consumption.
In a series of articles published in the 1970s and 1980s, Friedmann
mapped the set of national policies and international arrangements that led
to American grain surpluses from the 1950s to the 1970s, and the way in
which the U.S. government used food aid to create new markets for grain in
developing nations. This work was notable for the ways that it linked the
politics of grain production in the U.S. to the politics of grain consumption
in developing countries that received food aid and imported wheat, and for
the connections it drew between sales of U.S. wheat, the decline of native
grains, and proletarianization in developing nations (1978, 1980, 1987,
1993). In a sense it accomplishes what Goodman and DuPuis (2002, p. 9)
have called the ambitious task of theorizing the ways that practices of food
provision and consumption are co-determined.
In later work, Friedmann and McMichael (1989) have described the
growth of the post-war agro-food commodity complexes that they call
durable foods and intensive meat production. Within these complexes,
agricultural products such as soy or corn become part of commodity chains
that are dominated at both ends by increasingly large industrial capitals.
Their account of the capture of agriculture by industry and the rise of new
forms of agro-industrial capital is macro in scale, but emphasizes contin-
gency and politics. For example, in discussing the growth of durable
foods, Friedmann and McMichael emphasize that sweeteners and protein
llers can be derived from a variety of sources, and that industrial actors
choose sources based on relative prices with prevailing techniques. These
prices and techniques are themselves political since agricultural policies
determine supplies and prices of grains and soy, while state-funded research
determines what technologies are available. There is no pre-determined
outcome here, as different branches of capital, distributed across national
boundaries, vie for ascendancy. In a similar way, they show that the growth
of the meat/soy/maize complex depended on the negotiation of trade rules
that permitted the transnational integration of the sector and that were in
contradiction with the growth of the state system in the post-World War II
period. The picture that emerges is one in which outcomes are contested and
uncertain and in which not only capitalism, but the food sector itself, is
highly differentiated. As Friedmann and McMichael (1989, p. 112) say, not
only is agriculture no longer a coherent sector, but even food is not.
The work of these researchers does not go as far as some critics have
suggested it should in abandoning structural concepts and in specifying
actors and processes. Busch and Juska, for example, have complained of a
10 JANE L. COLLINS
continued tendency, in commodity chain research, to reify corporate ac-

tors. They have suggested that actor network theory, by focusing on ties
between individuals, rather than institutions, offers advantages in account-
ing for specific instances of corporate behavior and outcomes. Cargill Grain
Corporation and national legislatures do not act, they argue, but rather
individuals within the rm or the Congress (1997). This call to deconstruct
the institutional actors of political economy is useful in putting names and
faces on sometimes shadowy global actors. But it also skirts close to the
edge of methodological individualism in refusing to acknowledge the role of
institutional culture and practice, regulatory and legal conventions, and
other sets of patterned and somewhat durable social relationships.
COMMODITY CHAIN ANALYSIS AND ECONOMISM
Critics of development theory have also argued that researchers have priv-
ileged the economy over other aspects of life, seeing it as the fundamental
determinant of social systems and historical events. To quote Graham and
Gibson (1996, p. 24) once again, within political economy and the political
movements it has spawned or inspired, economic determinism has reigned.
Critics argue that development theorists have paid scant attention to culture
(except as an impediment to economic progress) and even less to meaning
and to discourse.
For Jane Dixon (1999), the analysis of commodity chains provides op-
portunities to draw culture and meaning in, because of the nature of the
commodity itself. Commodities are not only central to trade, but to human
physical comfort, to self-expression and to group representation. They can
signify social status and the comforts of home. In her words, moving
beyond the exchange value of a thing to what Marx called its use value, and
beyond its production to those who process, advertise, sell, buy, and use it,
opens political economy to considerations of meaning and to the unwaged
work and play of the sphere of social reproduction (1999, p. 157). For these
reasons feminist analysts, and a variety of post-modern theorists, have seen
commodity studies as occupying a ground where the material, the social,
and the meaningful meet.
One of the most successful accounts linking production and consumption,
culture and political economy in the study of a commodity is, of course,
Sidney Mintzs Sweetness and Power (1985). In this now classic work, Mintz
tracks the meteoric rise in sugar consumption in Europe from 1650 to 1900,
problematizing how this demand was created, how tastes evolved toward
a preference for sweetness, and how sugar moved from a luxury, a med-
icine, a spice to a daily necessity. He shows how these changes depended on
the European seizure of colonies and the creation of colonial enterprises
based on slavery. He argues that sugar made visible the connection between
the will to work and the will to consume, so that new wage earners partly
worked to be able to buy it. But also its cheap calories and satisfying prop-
erties reduced the cost of feeding European workers. In this way Mintz
argues, quoting Marx, the veiled slavery of wage workers in Europe need-
ed, for its pedestal, slavery pure and simple in the New World.
While in this brief formulation Mintz account would appear to fall into
the category of totalizing explanations, it is full of contingency, agency, and
strange historical accident. As he notes because the whole process from
the establishment of colonies, the seizure of slaves, the amassing of capital,
the protection of shipping and all elseytook shape under the wing of the
states, such undertakings were at every point as meaningful politically as
economically and the outcome of political struggles between industrialists
and mercantilists, colonists and metropole were uncertain in each era. Con-
sumer taste is not simply a matter of free will, in his view, which would
require us to assume that each and every Briton, day by day and year by
year, chose individually to seek and consume sucrose in greater and greater
quantities. But neither is it simply dictated by those in power; rather, it is the
result of a complex interaction between the availability and marketing of
goods by capitalist rms and local practices of consumption that include
food habits and cuisine. Mintz (1985, p. xvii) has said that as one attempts
to put consumption together with productionythere is always a tendency
for one or the other to slip out of focus. But in his book, economy and
culture are tightly bound together as he shows how the rst sweetened cup
of tea pregured both new social relations and new meanings of work and
self (1985, p. 214).
A more recent study that illustrates the inseparability of cultural and eco-
nomic processes in the life of a commodity is Melanie DuPuis (2002) account
of how milk became a staple in the American diet. Her book investigates
the changing cultural landscape within which milk drinking became popular,
including the portrayal of milk as the perfect food, which tapped into
concepts of perfectability in American public life. She describes the 19th
century public rhetoric and debate that created milk as a new, modern food
that was complete and brought the purity of farm life to urban consumers,
even before pasteurization and refrigeration had rendered milk safe for these
populations. Examining why this should have been the case, she shows
how this trend was driven by a complex array of factors, including growing
12 JANE L. COLLINS
numbers of women working outside the home, the loss of family-based

communities of practice within which knowledge about breast-feeding of
infants was transmitted, middle and upper class ideas of genteel femininity,
and the industrys development and advertising of new products.
Turning to the production side, she details shifts in the social, political
and economic relationships of dairy farming from the late 19th century to
the present. She contends that milk is different from many other commod-
ities, such as wheat, rice or orange juice, because people have been unwilling
to adopt its concentrated or powdered form, and must be consumed within a
short period. This has meant that production continues to be local rather
than global, organized in milksheds around urban centers. She describes
the way in which this organization creates competition among producers
from different regions, which in some periods has allowed policy makers or
large buyers to control milk prices. But she also shows how policies in each
of the three big milk states in the U.S. have evolved differently, as policy-
makers and organized public actors weigh the protection of small farms
against the provision of cheap milk.
Like Mintz, DuPuis work shows the interplay between the ways in which
milk was used, the ways it was thought about, the transportation systems that
moved it, and the interests that profited from it. By focusing on key debates in
public institutions, she is able to show how market forces, resources, and
culture meet. What links the work done by farm extension agents in New York
State with the habits of milk consumers in New York City in her account, is
the way that power has structured what they both take for granted about milk,
about health, and about proper farming.
COMMODITY CHAIN ANALYSIS AND

WESTERN BIAS
A third critique of development theory has argued that while it has pretended
to speak from the neutral position of science, it has represented western
interests and values and has left no space for subaltern voices. In the words of
Akhil Gupta: The modern, the celebration of western progress, civilization,
rationality and development, came to be instituted as a global phenomenon
through colonialismy. After the formal demise of colonialism, one of the
chief mechanisms by which this self-representation has been promulgated has
been through development discourse. Calling it orientalism transformed
into a science for action, Gupta (2000) argues that development discourses,
with their built-in teleologies and spatial hierarchies, created subject positions
that reinscribed inequalities after the dismantling of colonial rule. Julie

Graham and Katherine Gibson (1996) have concurred. They write: During
the post-World War II period, bourgeois economic development theory in-
stalled industrial capitalism at the pinnacle of economic and social evolution,
constituting the western experience of capitalist development as the model
and measure for all the world. They argued that both mainstream and left
development discourses shared this view of capitalist development as the
motor of history, differing principally in how to read such a change: was it
the coming of an earthly kingdom orya process of devastation and laying
waste?
Here, I will turn briefly to research I conducted in the late 1990s on the
global apparel industry as an example, because my use of commodity chain
analysis was directly tied to my desire to provide a more open-ended and
multi-vocal account of development process (Collins, 2003). The Interna-
tional Labor Organization has called the global apparel industry a true one-
world employer in the sense that workers in different parts of the world
compete to perform the same operations for the same rms and that com-
panies can scan the global landscape in search of the kind of workers that
please them. As an anthropologist by training, I wanted to bring an ethnog-
raphers eye to the experience of workers positioned differently within this
global labor market and to the question of what unites and divides them.
Given this question, I faced a problem: how do you study a global industry?
Anthropologists are trained to go to a particular place and get to know it very
well, but how do you do that with a phenomenon that does not happen in a
single place, but is scattered around the globe? A phenomenon that geogra-
phers say occurs, not in a space of place, but a space of ows? How do
you study all of its different manifestations and what feminists would call its
situated perspectives and integrate them into a coherent story?
In order to resolve this problem, I combined commodity chain analysis
with multi-sited ethnographic investigation along the commodity chain. In the
rst, more standard part of the analysis, I read the trade press and the eco-
nomics journals to gure out the structure of the apparel industry and the
competitive pressures it faces. This kind of analysis helped me to trace the
economic linkages that join Wall Street and Madison Avenue, the factories
that make clothing, the stores that sell them and the consumers that buy
them. It allowed me to develop an understanding of the global regulatory
environment and the way in which the interests of corporations transcended,
and frequently contradicted, the interests of national governments.
In the ethnographic part of the research, my goal was to put names
and faces on actors throughout the commodity chain, from the ofces of
14 JANE L. COLLINS
Liz Claiborne in New Jersey to a factory oor in Aguascalientes, Mexico.

I wanted to be able to say something about the decisions and actions, struggles
and negotiations that took place in a large number of specific places where
people live and work. As George Marcus (1995) has pointed out, the goal of
this kind of multi-sited ethnographic investigation is not to provide a holistic
representation of a global industry, but to collect a set of partial or situated
perspectives relating to the phenomenon in question, juxtaposing views and
experiences that have traditionally been kept apart. To quote Jennifer Mendez
(2005) what emerges is a picture, not of a global village, but of a transna-
tional political terrain, rife with conict and competition (2005). Then, for the
researcher, analysis consists of positing a logic of connection among the sites,
developing an argument about their relationships to one another. This seemed
to me to be a good way to construct a study of a global industry like apparel.
In many ways, the second part of this approach seems similar to what
actor network theory theorists have been calling for, since it explores the
way that actors in networks create social relationships and social meaning.
But it locates these networks and interactions in a broader framework,
situating them within the political economy of the commodity chain and
reading their meaning within the political terrain of that location. So this
approach names and species concrete acts as Latour (1993) or Busch and
Juska (1997) urge. But it also examines the policies and procedures that
make a given apparel rm more than the sum of its individual employees, as
well as the competitive climate of the industry, the laws and rules that
govern its labor and trading practices, and the way in which the industry is
driven by trends like retail consolidation and the imperative to demonstrate
a continually rising share price.
CONCLUSION
I began by suggesting that the growing popularity of commodity chain anal-

ysis was fueled by the development critiques of the 1980s, and the desire to
nd ways of working that continued to address issues of political and eco-
nomic change while taking these critiques seriously. I have pointed to exam-
ples of work that used a commodity chain approach to produce accounts of
change that were less deterministic, less economistic and less imbued with
western bias than many neoclassical or Marxist accounts of development
process. I believe that these examples demonstrate the potential for situated,
contingent accounts of global political economy that are historically specific,
sensitive to culture and meaning, and attentive to subaltern perspectives.
These accounts are likely to be more fragmentary in their exposition,

more tentative in their conclusions, and more aware of gaps and ssures
than their predecessors. But they are not all at the micro-sociological level.
As Akhil Gupta has said, the post-modern critique of meta-narratives has
too often been extended to any explanation that seeks to account for global
phenomena such as capitalism, confusing closure with scale. He continues,
while some scholars have argued that a turn to local events and individual
life narratives is a way to evade totalizing explanationsylocal phenom-
enayareyno less susceptible to totalizing, unsituated and teleological rep-
resentations than global ones and there is no reason that non-teleological
explanations about capitalism cannot be advanced (2000, p. 12).
But are commodity chain analyses innocent of theory? Are these accounts
purely empirical, drawing on the metaphor of the commodity chain simply
as a device to organize the collection of data? I think that this is not, and
cannot be the case. Each of the research projects I have described had strong
theoretical motivations. In fact, in all of the cases that I cited, researchers
were inuenced by more than one paradigm. Friedland strategically com-
bined labor process theory with more standard versions of industrial so-
ciology; Geref drew together world systems theory with institutionalist
economics. The regulationist perspective that Friedmann and McMichael
used to craft their concept of the food regimes was already an amalgam or
integration of several different theoretical approaches.
As a method, commodity chain analysis appears able to accommodate a
variety of different theoretical agendas, but it cannot stand alone. No method
or approach is innocent of theory, and commodity chains are no exception.
Rather, I would argue that it is a richly promiscuous approach that helps to
concretize and situate a broad range of theoretical perspectives, and that
doing so makes them skeptical of determinisms, more sensitive to culture, and
more aware that the processes we label development are experienced, un-
derstood and valued differently from locations along the commodity chain.
REFERENCES
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of agriculture. Review of International Political Economy, 4(4), 688708.
Collins, J. L. (2003). Threads: Gender, labor and power in the global apparel industry. Chicago:
University of Chicago Press.
Dixon, J. (1999). A cultural economy model for studying food systems. Agriculture and Human
Values, 16, 151160.
16 JANE L. COLLINS
DuPuis, E. M. (2002). Natures perfect food: How milk became Americas drink. New York:
New York University Press.
Friedland, W. (1984). Commodity systems analysis: An approach to the sociology of agricul-
ture. In: H. K. Schwarzweller (Ed.), Research in rural sociology and development:
A research annual (pp. 221235). Oxfordshire: Elsevier.
Friedland, W. (2001). Reprise on commodity systems methodology. International Journal of
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Friedland, W. H., & Barton, A. H. (1975). Destalking the wily tomato: A case study in social
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Friedland, W. H., Barton, A. E., & Thomas, R. J. (1981). Manufacturing green gold: Capital,
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Friedmann, H. (1980). Household production and the national economy: Concepts for the
analysis of agrarian formations. Journal of Peasant Studies, 7, 158184.
Friedmann, H. (1987). The family farm and international food regimes. In: T. Shanin (Ed.),
Peasants and peasant societies (pp. 247258). London: Basil Blackwell.
Friedmann, H. (1993). The political economy of food. New Left Review, 197, 2957.
Friedmann, H., & McMichael, P. (1989). Agriculture and the state system: The rise and decline
of national agricultures, 1870 to the present. Sociologia Ruralis, 29, 93117.
Geref, G. (1994). The organization of buyer-driven global commodity chains: How U.S.
retailers shape overseas production networks. In: G. Geref & M. Korzeniewicz (Eds),
Commodity chains and global capitalism (pp. 95122). Westport: Praeger.
Geref, G., Korzeniewicz, M., & Korzeniewicz, R. P. (1994). Introduction. In: G. Geref &
M. Korzeniewicz (Eds), Commodity chains and global capitalism (pp. 114). Westport:
Praeger.
GibsonGraham, J. K. (1996). The end of capitalism (As we knew it): A feminist critique of
political economy. London: Blackwell.
Goodman, D., & DuPuis, E. M. (2002). Knowing food and growing food: Beyond the pro-
duction-consumption debate in the sociology of agriculture. Sociologia Ruralis, 42(1),
522.
Gouveia, L. (1997). Reopening totalities: Venezuelas restructuring and the globalisation
debate. In: D. Goodman & M. Watts (Eds), Globalising food: Agrarian questions and
global restructuring (pp. 305323). New York: Routledge.
Gupta, A. (2000). Postcolonial development: Agriculture in the making of modern India. Durham:
Duke University Press.
Heffernan, W., & Constance, D. (1994). TNCs and the globalization of food. In: A. Bonnano,
L. Busch, W. Friedland, L. Gouveia & E. Mingione (Eds), From Columbus to ConAgra:
The globalization of agriculture and food. Lawrence: University of Kansas Press.
Jackson, P. (1999). Commodity cultures: The trafc in things. Transactions of the Institute of
British Geographers, 24, 95108.
Latour, B. (1993). We have never been modern. Cambridge: Harvard University Press.
Marcus, G. (1995). Ethnography in/of the world system: The emergence of multi-sited eth-
nography. Annual Review of Anthropology, 24, 95117.
Mendez, J. B. (2005). From the revolution to the maquiladoras: Gender, labor and globalization in
Nicaragua. Durham: Duke University Press.
Mintz, S. W. (1985). Sweetness and power: The place of sugar in modern history. New York:
Penguin.
Raikes, P., Jensen, M. F., & Ponte, S. (2000). Global commodity chain analysis and the French
Filiere approach: Comparison and critique. Copenhagen: Centre for Development
Research, Working Paper no. 00.3.
Watts, M., & Goodman, D. (1997). Agrarian questions: Global appetite, local metabolism:
nature, culture and industry. In: D. Goodman & M. Watts (Eds), Globalising food:
agrarian questions and global restructuring (pp. 135). New York: Routledge.
Wilkinson, J. (1997). A new paradigm for economic analysis? Economy and Society, 26(3),
305339.
TRANS-LOCAL AND
TRANS-REGIONAL
SOCIO-ECONOMIC STRUCTURES
IN GLOBAL DEVELOPMENT:
A HORIZONTAL PERSPECTIVE$
Sandra Halperin
ABSTRACT
This chapter explores the trans-national and cross-regional interactions and

connections that, beginning in the late eighteenth century, brought about
the development of dualistic economies within and outside of Europe; and
how this circuit was reconfigured after the world wars by means of decol-
onization, nationalism, first and second world development, and glo-
balization. What this perspective brings into view is a horizontal rather than
vertical division of the world: the synchronic and interdependent develop-
ment of dynamic focal points of growth throughout the world shaped, both
within and outside of Europe, by trans-local interaction and connection, as
well as by local struggles and relations of dominance and subordination.
$
A shorter version of this paper will appear in Varieties of World-Making: Beyond Global-
ization by Peter Wagner and Nathalie Karagiannis ((c) Liverpool University Press 2006).
Adapted with permission.

r 2005 Elsevier Ltd. All rights reserved.
ISSN: 1057-1922/doi:10.1016/S1057-1922(05)11002-6
19
20 SANDRA HALPERIN
INTRODUCTION
Most perspectives on development assume that industrial capitalism was
achieved in the West through a process of nationally organized economic
growth and that, today, its organization is becoming increasingly trans-local
or global. However, nationally organized economic growth has rarely been
the case: from the start, capitalist development has been essentially trans-
national in nature and global in scope involving, not whole societies, but the
advanced sectors of dualistic economies in Europe, Latin America, Asia,
and elsewhere. This paper endeavours, therefore, to explore development
from a perspective that analytically shifts the axis of view from the vertical
(states, regions) to the horizontal (classes, networks) and, in this way, to
bring into view the synchronic and interdependent development of dynamic
focal points of growth throughout the world shaped, both within and out-
side of Europe, by trans-local interaction and connection, as well as by local
struggles and relations of dominance and subordination.
Most accounts of the development of capitalism begin with the rise of
Europe. The story they tell is that the lights went on in Europe following
the European dark ages (or, certainly by the eve of Europes industrial
revolution) just as, or long after, they had gone out elsewhere in the world;
and that, as a result of European exploration, settlement, colonization, and
conquest, lights of varied brightness and colour gradually appeared in non-
European areas of the world over the course of the next two centuries.
Accumulating evidence of its inadequacies is making this story increas-
ingly unconvincing. As Janet Abu-Lughod (1989) and others have shown,
the rise of Europe took place within an already existing system, stretching
from western and southern Europe through the Middle East to China, and
characterized by a prosperous and far-ung trading network and an active
and important network of intercultural exchange. European military ex-
pansion into this system did not displace or destroy it: when the lights went
on in Europe they remained on elsewhere in the world.
Thus, after the lights went on in Europe, the actual pattern of economic
expansion throughout the world resembled (to borrow an image from James
Blaut, 1993, p. 171), a string of electric lights strung across Asia, the
Middle East, Africa, Latin America, and Europe. These lights illuminated
small islands of urbanized industrial society and export sectors in Asia,
Latin America, Europe, and elsewhere, each surrounded by traditional
communities and institutions and underdeveloped, weakly integrated local
economies. This pattern developed around the world as elites and ruling
groups, seeking to expand production while, at the same time, avoiding the
Trans-Local and Trans-Regional Socio-Economic Structures 21
social levelling required for the production of articles for mass local con-
sumption, produced for external markets, instead. As a result, both within
and outside of Europe, domestic markets remained weak and poorly inte-
grated, and economic expansion proceeded through a trans-local/cross-
regional exchange of capital and commodities among governments, ruling
groups, and elites.
LOCAL RELATIONS OF POWER IN EUROPE
Distinctions are conventionally drawn between class structures in different

European societies and, particularly, between those that were supposedly
dominated by an indigenous, independent capitalist bourgeoisie, and those
that were not. This distinction is the basis of various schemas that dene
two roads to industrial capitalism and democracy in Europe. One road,
exemplied by Britain, is characterized by the emergence of a relatively open
political space the result of a bourgeois revolution having displaced the old
landed aristocracy and the absolutist state. The second road, exemplied by
Germany and other late developers, is distinguished by its relatively
closed political space, the result of the continuing dominance of an agrarian
class able to block industrialization and resist democracy.1
But nowhere in Europe was there a clear division between industrial and
landed capital; in fact, everywhere industrial capitalist development was
characterized by their fusion. In Britain, as elsewhere, the nature of indus-
trial capitalist development was shaped by the political convergence of a
landed aristocracy and large capitalist manufacturers.2
Many have argued that this elite had become bourgeosied by the eight-
eenth or nineteenth century. However, throughout the nineteenth century, the
most effective elites were traditional and aristocratic, land owning and rent
receiving, and oligarchic. Rosa Luxemburg got it precisely right: in England,
there was no revolutionary changeover from medieval to modern society, but
an early compromise which has preserved [into the twentieth century] the old
remnants of feudalism. The old forms of medieval England were not shat-
tered or swept away, but lled with new content (Luxemburg, 1976, p. 232).
The ways in which agrarian elites exercised power, and the degree of
closure and restriction they succeeded in maintaining varied; but while it is
possible to quibble about the extent that these varied, it was not substantial
enough to constitute a different road. Either, the aristocracy absorbed the
industrial bourgeoisie and dominated it, protecting land and income struc-
tures; or the aristocracy resisted the industrial bourgeoisie and dominated it,
22 SANDRA HALPERIN
protecting land and income structures. Either way, the road that emerges is
essentially the same.
The two roads of industrial capitalist development that supposedly
emerged in Europe were thought to have resulted from different relation-
ships between the rising capitalist bourgeoisie and absolutism. The road to
industrial development and democracy was made possible, it is assumed, by
the conict between the new industrial capitalist classes in Europe and ab-
solutist monarchs; while the road to autocracy emerged as a result of the
fusion of these classes with absolutism. However, the conict between the
new bourgeoisie and absolutist monarchs involved only selective aspects
of absolutism and, specifically, those that scholars have identied as en-
lightened and liberal (see, e.g., Gagliardo, 1967). The leaders of the
national revolutions and revolts against absolutism were opposed to the
liberal reforms and, particularly, the price and wage controls, labour
protections, and national welfare systems that had been introduced in
Britain, France, and elsewhere by monarchs beginning in the sixteenth cen-
tury. Their aim was to seize control of the state in order to preserve their
privileges and prerogatives, to privatize new sources and means of produc-
ing wealth, to dismantle much of what today we would consider socially
enlightened about liberal absolutism, and retain much of what was not in
a new guise. In fact, many of the revolutionary and progressive changes
attributed to the nation states established by the new capitalist class were
aspects of liberal absolutism that survived the nationalist assault; they orig-
inated, not with a revolt against the mercantilist systems of Absolutist
states, but with reforms of land, tax, educational and legal systems intro-
duced by Absolutist monarchs.
For instance, the features of France that, in 1815, were thought to re-
semble a bourgeois state, were the work, not of the Revolution, but of the
ancient regime. It was the ancient regime that established the centralized
administrative apparatus of the French state, introduced standing armies,
national taxation, a codied law, and the beginnings of a unied market. It
was Frances ancient regime that, long before 1789, began the break up of
large estates into a multiplicity of small proprietorships. Nor, as
de Tocqueville concluded, were the ideas and values supposedly born in
the Revolution the product of a new and revolutionary class (1955, p. ix). In
sum, from a strictly French point of view, the balance sheet of the French
Revolution is relatively meagre (Wallerstein, 1996, p. 12).
It is often assumed that, in Britain, the repeal of the Corn Laws marked
the end of the power of the traditional landowning elite there. The Corn
Laws, however, were not shoring up a declining sector; they were designed
to retain the high profits generated during the Napoleonic war years. Wheat
prices did not fall until the onset of the Great Depression in the 1870s
(Hobsbawm, 1968, p. 197). For most of the nineteenth century, British
agriculture remained the biggest branch of the economy by far in terms of
employment. In 1891 it still employed more than any other industrial group.
Only in 1901, with the growth of the transport industry and metal industries
complex, did it cease to be the largest branch of the economy in employment
terms (Hobsbawm, 1968, p. 195).
Revolutions in Europe in 1789, in the 1820s, 1830s and in 1848 gave a
stronger position to industrialists and bankers, weakened the landlords
inuence and, in places, partly replaced the political personnel. However,
they failed to bring about a thorough-going transformation of social struc-
tures. Except in Russia after 1917, the traditional social structure of Europe
remained essentially intact up until 1945.
While the capitalist class or bourgeoisie was a heterogeneous class, with
many different elements or fractions, the circumstances of nineteenth cen-
tury Europe and, specifically, the revolutionary currents unleashed, rst, by
the French Revolution and the Napoleonic wars and, later, by the revolutions
of 1848, increasingly polarized European society along class lines and, thus,
brought about the fusion and unity of various fractions of capital. As a result,
the economic divisions among capitalists, and other divisions of various kinds
that might have given rise to intra-class conict, were of far less importance
than the issues over which that class as a whole was more or less united. So,
for example, while landed and industrial capital in Britain clashed over the
Corn Laws, they were united in a struggle to prevent labour from achieving
any significant political and economic power; and it was this struggle that
dominated the nineteenth and early twentieth centuries in Europe.
In 1848 a class compromise was forged between industrial and landed
elites as a result of the willingness of the industrial bourgeoisie to press their
demands through mobilizing the masses. After 1848 landlords and industrial
capitalists can be seen as fractions of a single class.3
During the interwar period, and as a result of World War I, an intra-class
division began to open up. In Britain, this was evident by the chasm that, by
1939, divided Chamberlain and Churchill. Confrontation with more pow-
erful and militant working classes as a result of the war, elements of capital
began to recognize the limits of the system. It became apparent that far
more dire social externalities might be produced by a continuing dependence
on methods of increasing absolute surplus value, than those that the U.S.
model showed might be produced by a shift to relative surplus value
production. The narrowing prospects for increasing overseas markets, and
24 SANDRA HALPERIN
the escalating costs it entailed must have also become increasingly apparent
(more on this, below). Moreover, a second industrial revolution was oc-
curring, made up of the electrical, chemical, and auto industries comprising
relatively large rms with capital-intensive processes. These industries were
bound to look upon good labour relations and high and steady levels of
production as more important than low wages and mere cheapness. Since
their products and production runs demanded a more homogeneous market
of high-income consumers, they were also more interested in the domestic
and Dominion markets than with those of India and the less developed
world or even Europe.4
However, though there were differences among fractions of capital during
the interwar years, the revolutionary currents unleashed by World War I
increasingly polarized European societies and, in this way, worked effec-
tively to keep the capitalist class unied. As a result, the continuing prom-
inence of the traditional elite was evident to 1939, and beyond.
Land in Britain, as elsewhere in Europe, was highly concentrated and,
throughout the nineteenth century, the larger landowners continued to en-
large and consolidate their landholdings.5 Its farming system was among the
least mechanized among advanced countries. The majority of farms in
England and Wales did not possess either a tractor or a milking machine
until World War II, despite their having been available for thirty years or
more. They remained relatively small and investment in them relatively low.
Like its agriculture, Britains nancial and industrial sectors were bound
by monopoly and restriction.6 The City of London, in which greater for-
tunes were made than in the whole of industry, remained enmeshed in a
pseudo baronial network of gentlemanly non-competition.7 Industry be-
came increasingly penetrated by monopoly and protection during the nine-
teenth century. Traditional corporatist structures guilds, patronage and
clientelist networks survived in some places and grew stronger. Elsewhere,
new corporatist structures were created. The modern cartel movement began
developing in the 1870s and by 1914 pervaded industry throughout Europe.
In what David Landes aptly calls a commercial version of the enclosure
movement (1969, p. 247), Britain answered the cartel with the combine,
which amalgamated in various degrees a sizeable fraction of the productive
units of a given trade.
These formed part of the complex of privileged corporations and vested
interests in Europe that, by 1914, had become quite as formidable as those
of the Old Regime (McNeill, 1974, pp. 164165).
These were neither peripheral aspects of Britains industrialization, nor ever-
diminishing forces of resistance to industrial expansion. They highlight the
extent to which the traditional landowning elite which formed the basis of
Britains capitalist class,8 dominated the state apparatus, and led Britains
capitalist development channelled industrial expansion into dualistic and
monopolistic forms. Dualism preserved the political and economic bases of
traditional groups by restricting growth to within the constraints posed by the
concentration of capital and land ownership. In so doing, it also generated the
structural distortions that, collectively, are erroneously associated exclusively
with third world dependent development. Dominant classes monopolized
domestic industry and international trade through cartels and syndicates, tar-
iffs and other controls. They instituted corporatist arrangements of a discrim-
inatory and asymmetrical nature to limit competition and they obstructed
rising entrepreneurs and foreign competitors. As a result, industrial expansion
in Europe was shaped, not by a liberal, competitive ethos, as is emphasized in
most accounts; but by feudal forms of organization, monopolism, protection-
ism, cartelization and corporatism, and by rural, pre-industrial, and autocratic
structures of power and authority.
THE TRANS-LOCAL STRUCTURE OF INDUSTRIAL

CAPITALIST EXPANSION
Perhaps the most crucial chapter in modern history for understanding the
accelerating globalization of capital today is the dismantling of eighteenth
century Europes systems of national welfare and regulated markets, and the
social conicts that emerged as a result. The context of these events was the
attack on the regulations of the Absolutist (i.e., interventionist) state.
In the eighteenth century, Absolutist governments in England,9 France,
and elsewhere in western Europe were regulating local markets, as well as
controlling employment, and settlement. Absolutism was attacked by its
opponents for its over-regulation. However, the aim of much of this reg-
ulation was to provision the local community and ensure fair practice, to
protect the local population against monopoly and speculation, and against
shortages and high prices. In England, ofcial regulations prevented mid-
dlemen merchants from bypassing or cornering the market, and ensured
quality control, a just price, and an adequate domestic supply of goods;
and market courts enforced them (Lie, 1993, p. 282). Those in England who
demanded freedom of trade during the eighteenth century were actually
demanding freedom from the requirement to trade inside open markets, by
means of open transactions, and according to the rules and regulations
which ensured fair practices and prices (Lie, 1993, p. 283).
26 SANDRA HALPERIN
In the eighteenth century Britain, entrepreneurs sought to escape gov-

ernment regulations through long-distance trade and expanded production
for export.10 As a result, competition for labour increased, and this
enabled workers to bargain for wages and regulate their work time. Wages
rose throughout the century and labourers were able to take on less work
and spend more time at leisure without endangering their traditional
standard of living (Gillis, 1983, p. 41). Economies in Europe at the time
were based on local markets and face-to-face relations between seller and
consumer, so workers were often able to exercise economic power as
consumers, as well.
However, by the end of the eighteenth century these features became the
target of a broad campaign to dis-embed capitalist development. In order to
consolidate and maintain the subordination of labour to capital (the basic
relation of capital), dominant classes sought to keep labour poor (political
power was based on wealth, not citizenship) and in excess of demand (in
reserve); gradually but persistently, they worked to destroy the market po-
sition of the skilled labourers of previous centuries who were more independ-
ent and valuable, and could therefore command higher wages and regulate
their own time. By pursuing a strategy of expanding production largely for
export, they obviated the need to furnish labourers with sufcient means to
buy what they produced and deprived them of the ability to exercise power
through consumer choice or boycott, as they had in the eighteenth century.
They kept peasants and rural workers poor and weak by blocking land reform;
monopolized domestic industry and international trade through the creation
of cartels and syndicates, and through tariffs and various other controls; in-
stituted corporatist arrangements of a discriminatory and asymmetrical na-
ture to place further limits on competition; and obstructed rising entrepreneurs
and foreign competitors. Land and industry became concentrated in fewer and
fewer hands in the course of the century; methods of increasing absolute
surplus value production, and traditional manufacturing, persisted; and an
unprecedented degradation and intensication of labour, both within and
outside of Europe, produced an increasing volume of goods and capital for
circulation among a trans-national network of property-owners.
Europes Transnational Industrial Expansion
States in Europe were built up within a pre-existing, region-wide system of

social institutions, relationships, and norms. Administration derived from
the same principles, political assemblies were composed of the same
elements and invested with the same powers. For centuries, and with the
Church acting as an international unifying agent, regulating economic life
and political and class struggles across the region, political development,
class struggles, social change, ideology, and culture remained essentially
trans-European.11
As many scholars have noted, Europes elite was more closely tied by
culture and concrete interests to an international class than to the classes
below them. The pan-regional elite, as Eric Hobsbawm has pointed out,
bore something like a family resemblance to one another and was often
physically distinct from peasants within their own countries; often they were
of a different nationality or religion, or spoke a different language. Even
where they had the same nationality and religion, their mode of life had in
all respects more in common with elites elsewhere in Europe, than with the
lower classes within their own countries.12
Because of the essentially transnational nature of European society and
the similarities and interdependencies that it created among states, as the
various economies of Europe began to expand in the nineteenth century,
their advanced sectors were tied more closely to those within the economies
of other European countries than to the more backward sectors within their
own (see Halperin, 2004, Chapter 3). As a result, Europes economic ex-
pansion took place within, and was crucially shaped by, an increasingly
interdependent industrial system. Since interdependent parts must grow in
some sort of balance if profitability is to be maintained, the advanced sector
in one country had an interest in supporting and maintaining the growth of
advanced sectors in other countries,13 thus, reinforcing and maintaining the
uneven and dual pattern of economic expansion characteristic of indus-
trial capitalist development everywhere in Europe. In the nineteenth cen-
tury, and as a result of the structural relations of connection and interaction
that constituted the trans-European class, similar relations were established
in sites of production; and they were reproduced, in similar ways, by their
maintenance throughout the social formation.
The ruling classes of European states were not separate-but-similar class-
es. Rather, they formed a single trans-regional elite, and their broadly sim-
ilar characteristics, interests, capabilities, and policies were constituted and
reproduced through interaction, connection, and interdependence. While
the properties of dominant groups in different parts of Europe may have
varied, the connections and interactions among them were rich and concrete
and, in themselves, and within the constraints and opportunities present in
different contexts, produced a set of common solutions to the problems of
organizing production along new lines.
28 SANDRA HALPERIN
The late eighteenth century industrial revolution in Europe did not

involve any fundamental change in this trans-European social system. In
fact, the reorganization of social relations of production in Europe as a
result of the industrial revolution brought different groups across states
into closer relations of interdependence.
It is generally the case that elites are interested in adopting the most up-
to-date methods of multiplying their revenue, wealth, and power. The ob-
vious success of the British elite in this regard would have been expected to
inspire elites elsewhere in Europe to emulate British economic, social, ad-
ministrative, and intellectual trends.
It was, thus, that common problems arising from the establishment of a
capitalist labour market and new labour processes were generally resolved
throughout Europe in broadly similar ways. Dominant classes have a com-
mon interest in exploiting labour (for profit). The ability to exploit labour
by paying less for it than the value it produces is a necessary condition for
creating surplus value and, thus, of realizing profit. In order to exploit
labour, capitalists must maintain an advantageous balance of power. Since
it is a necessary condition for realizing profit, it was a task faced by every
dominant group seeking to increase profits by expanding production; and,
given the numerical inferiority of capitalists, it was a critical one. How it was
met by dominant classes, varied across different societies according to the
type of goods they produced for sale and their power relative to labour. But
similar capabilities, as well as a common Europe-wide context tended to
shape their interaction with labour in similar ways. In Britain, dominant
classes ensured that the conditions for realizing profit were met by using
methods of absolute surplus value production at home (see Halperin, 2004,
Chapter 3) and expanding production largely for export to other ruling
groups. This became the model for industrial capitalism throughout Europe.
Europe emerged into its rst century of industrial capitalism from the
crucible of the Great War. A quarter century of war and revolutionary tur-
moil had made clear the central dilemma for dominant groups tempted by the
possibilities of great profits to reorganize production along the lines of in-
dustrial capitalism: how to mobilize train, educate and, in other ways,
empower labour while, at the same time, maintaining the basic relation of
capitalism, i.e. the subordination of labour to capital. The Great War had
revealed the dangers of a trained and compact mass army: many analogies, in
fact, were drawn between the mass army of soldiers created in the Great War
and the mass industrial army of workers needed for industrial capitalist pro-
duction. At the same time socialism had been born in the French Revolution
and its focus, in particular, on eradicating private property something
dominant classes had achieved through a century or more of struggle

seemed, in combination with the revolutionary ferment unleashed by the war,
to threaten an anti-capitalist revolt of the masses. This was the context within
which elites throughout Europe undertook to mobilize labour for industrial
production.
Elites were cohesive, had much to gain, controlled immense resources,
and were free to deploy these resources in a sustained pursuit of their aims.
They either controlled the apparatus of the state directly or had access to
political leaders and could trade their political support, or the withdrawal of
political opposition, for concessions from them. They were therefore able to
carry on a class struggle throughout the nineteenth century by means of a
purposive, determined, and essentially coherent legislative, legal, military,
and political assault on artisans, labourers, and peasants.
We are permitted to say that policies are designed that they are in-
tended, calculated, planned, premeditated, or deliberate. However, as is often
the case, there were unintended consequences of these policies and in this case,
there were important ones. By generating imperialist rivalries and conicts
that eventually led to multi-lateral great power war in Europe, external ex-
pansion had the unintended consequence of forcing governments and ruling
elites to mobilize (and, thus, organize, train and, in other ways, empower) the
masses. This is precisely what it seemed a century of external expansion had
enabled them to avoid. As a number of scholars have shown, war often
produces social levelling, revolution, and shifts in the balance of social forces
(e.g., Marwick, 1980, Chapter 11; Andreski, 1954, pp. 3338; Titmuss, 1958,
p. 86; Sorokin, 1927, pp. 338, 348349, 1969, p. 501; Schumpeter, 1976,
p. 419). In the course of the world wars this is what happened in Europe.
The European Model of Industrial Capitalist Expansion:

A Reinterpretation
Foreign trade was the primary engine of economic growth in England in the
nineteenth century; but it was the home market that initially gave the im-
petus to industrial growth in England between 1750 and 1780 (Eversley,
1967, p. 221; see also Mathias, 1983, pp. 16, 94). Britains industrial output
quadrupled during the eighteenth century, and the bulk of this output mass
consumption goods. Thus, during the century, Englands breakthrough in
production was accompanied by a democratization of consumption at
home.14 In the nineteenth century, however, and long before it had been
30 SANDRA HALPERIN
exhausted as a market for goods and capital, Britains domestic economy

ceased to expand; so much so, that by 1914 it had become under-mechanized
and poorly integrated relative to those of other advanced countries.
Numerous scholars have pointed out that British investors under-invested
in the domestic economy and, instead, massively exported capital.15 They
point out that funds used for British foreign investment could have been
used to improve the technical performance of British industry (Lewis, 1978a,
pp. 176177, 1972, pp. 2758; see also Trebilcock, 1981); they could have
helped to augment the stock of domestic housing and other urban social
overhead projects and, thus, expand the domestic market for the expanded
output of the British economy.16 Not only was investment needed at home
but between 1880 and 1914 returns from overseas investment were far
below what presumably could have earned by devoting the same resources
to the expansion of domestic industry.17 Moreover, these investments were
generally also exposed to more risk than domestic investments.
Why, then, did investors neglect opportunities for profitable home in-
vestment and, instead, pursue investments overseas that were riskier, more
difcult and costly to acquire and, in some cases, not as lucrative? The usual
explanation is that the domestic market was not yet developed enough to
absorb the output of expanded production and to provide profitable in-
vestment opportunities for surplus capital and that, as a result, capitalists
were forced to seek for larger markets and more profitable elds of invest-
ment abroad.18 But capital exporters did not then, and tend not now, to
have capital saturated domestic economies. Britain, and other European
economies, did not, as is usually assumed, develop initially on the basis of
the expansion of the internal market and then, subsequently, expand into
the foreign, colonial, and world markets: they expanded production rst and
foremost for foreign markets, and long before the opportunities for prof-
itable investment had been exhausted at home.19
In fact, the market that was saturated in Britain in 1902 and before, as
John Hobson made clear, was the one constituted solely by the wealthy
classes. Thus, to speak of saturation assumes that the mass of the pop-
ulation has no demand for any goods other than those necessary for their
own physical reproduction. Hobson argued that if the mass public raised its
standard of consumption to keep pace with every rise of productive powers,
there could be no excess of goods or capital... . Foreign trade would indeed
exist, but there would be no difculty in exchanging a small surplus of our
manufactures for the food and raw material we annually absorbed, and all
the savings that we made could nd employment, if we chose, in home
industries (Hobson, 1902, p. 81).
Therefore, It is not industrial progress that demands the opening up of

new markets and areas of investment, Hobson argued, but mal-distribution
of consuming power which prevents the absorption of commodities and
capital within the country (1902, p. 85). This was a typical consequence of
capitalism, Hobson observed; but it was not a necessary one.20 He argued,
in fact, that whatever was produced in England could be consumed in
England, provided that their was a proper distribution of the income or
power to demand commodities (1902, p. 88). But, as Hobson noted, more
than a quarter of the population of British towns was living at that time at a
standard below bare physical efciency (1902, p. 86).
Some theorists argue that while capital exports may not have been nec-
essary as a means of securing markets for surplus goods, they were necessary
to Europes industrialization as a means of acquiring raw materials and
accumulating capital (see e.g., Wallerstein, 1974, p. 38, 51, pp. 9395, 237,
269, 349). However, this contention has become the focus of considerable
dispute. Paul Bairoch has argued that the core countries had an abun-
dance of the minerals of the Industrial Revolution (iron ore and coal); they
were almost totally self-sufcient in raw materials and, in fact, exported
energy to the Third World.21 Colonialism, Bairoch argues was, therefore,
not necessary for industrial growth in Europe.22 In fact, he argues, it may
have actually hampered national economic growth and development.
If one compares the rate of growth during the nineteenth century it appears
that non-colonial countries had, as a rule, a more rapid economic develop-
ment than colonial ones. There is an almost perfect correlation. Thus colonial
countries like Britain, France, the Netherlands, Portugal, and Spain have
been characterized by a slower rate of economic growth and industrialization
than Belgium, Germany, Sweden, Switzerland and the United States. The
rule is, to a certain extent, also valid for the twentieth century. Thus
Belgium, by joining the colonial club in the rst years of the twentieth
century, also became a member of the group characterized by slow growth.
The loss of the Netherlands colonial Empire after World War II coincided
with a rapid acceleration in its economic development (1993, p. 77). Expand-
ing on this argument, Bairoch suggests that one reason for Britains relative
absence of the new industries that emerged at the end of the nineteenth
century was because its ability to sell easily non-sophisticated manufactured
goods to its colonies forestalled the need for modernization (1993, p. 167).
Given the difculties with standard interpretations of British investment,
it seems reasonable to look elsewhere for an explanation.
Production processes, as Alfred Sohn-Rethel has pointed out, are struc-
tured in ways that enable capital to retain its control over the class struggle
32 SANDRA HALPERIN
(1978, p. 163). Decisions about whether and how to increase or restructure

production are based on calculations about the conditions necessary for the
realization of profit. Disadvantageous social externalities produced by the
introduction of new production methods and by an expansion of output
would be part of those calculations. Had the democratization of con-
sumption of the eighteenth century continued, and had a broad-based
industrial growth developed, along with the mass purchasing power and
internal market needed to support it, the class, land, and income structures
on which the existing structure of social power in Britain rested would have
been destroyed.
Britains consumer revolution in the eighteenth century had important
implications for the structure of British society.23 Mass consumption is as-
sociated with democracy. The consumer revolution and the emergence of a
domestic market for mass- produced consumer goods, because it worked to
undermine class distinctions and increase social mobility, was politically
threatening and, thus, was not encouraged. A fully industrialized economy
requires mass mobilization. Mass mobilization for industry (as for war)
creates, out of the relatively disadvantaged majority of the population, a
compact and potentially dangerous force; thus, elites showed little interest in
the expansion of industry at home. Marx, as in much of his writing, was here
perhaps only reecting a general perception of his times when he wrote that
The advance of industry...replaces the isolation of the labourers...by their revolutionary
combination, due to association. The development of ModernIndustry, therefore, cuts
from under its feet the very foundation on which the bourgeoisie produces and appro-
priates products (Marx, 1967, pp. 9394).
It might be argued that owners of wealth were not conscious of the social
externalities associated with the application of large masses of labour to
production. This seems hardly plausible. The problems of setting to work
and controlling masses of labour are not so substantially different in cap-
italist production as to have made all prior problems and their solutions
irrelevant. For centuries landlords had been confronted with the great
fear of mass peasant uprisings, and had organized production in ways that
reinforced the existing relations of power and authority. The difference in
capitalist production, and it is crucial, is not the strategic power that work-
ers have peasants had that too but that for industry to grow and remain
competitive a sizeable portion of the labour force must be educated, skilled,
and mobile. If property owners were not conscious of the dangers of mass
mobilization for industry, would they not have been after Marx spelled it
out for them in the widely read and cited Communist Manifesto?
The development of exogenous demand and consumption through the

export of capital and goods ensured that the benets of expanded produc-
tion would be retained solely by the property-owning classes. In 1914, British
industrialization was as sectorally and geographically limited as dualistic
colonial economies. Landed and industrial property had become increas-
ingly concentrated. Mechanization, skilled labour, and rising productivity
and real wages were found only in sectors producing for export. These
sectors had only a limited impact on the rest of the economy. Little attempt
was made to expand or mechanize industries producing goods for domestic
household consumption. Consequently, the building industries grew by ex-
panding employment, rather than by introducing innovations either in or-
ganization or technology. New techniques were introduced slowly and with
considerable reluctance. In the 1930s, half the industrys workforce still
practiced their traditional handicrafts, especially in house building, largely
untouched by mechanization (Benson, 1989, p. 20). Though Britain had
pioneered electro-technics, by 1913 the output of the British electrical in-
dustry was little more than a third of Germanys (Hobsbawm, 1968, p. 180).
Before World War II, less than a third of those employed in the transport
sector were employed by the railways (28% in 1931). A majority of those
engaged in transport worked for a small employer or were self-employed
(Benson, 1989, pp. 2223). Despite the British origins of the machines and
machine tools industry, it was not until the 1890s that automatic machine-
tools production was introduced in Britain. The impetus came from the
United States, and the desire on the part of employers to break down the
hold of the skilled craftsmen in the industry (Hobsbawm, 1968, p. 181).
Gas manufacture was mechanized late, and as a result of pressure from
trade unions.
Even Britains export industries were slow to adopt new techniques or
improvements, not only in textiles, but also in coal, iron, steel, railways
and shipbuilding. The supply of coal increased,24 not by introducing la-
bour-saving techniques, but by increasing the number of coalminers.25 In
the 1930s, more than 40% of British coal was cut and practically 50%
conveyed without the aid of machinery (Benson, 1989, p. 16). Though
Britain was pre-eminent in steel production and had pioneered major in-
novations in its manufacture, with the exception of the Bessemer converter
(1856), Britain was slow to apply the new methods and failed to keep up
with subsequent improvements.26 By the early 1890s, Britain had fallen
behind Germany and the U.S. American shipbuilding expanded at a faster
rate than British and, by 1860, had almost caught up. Though British
industrialization was based on the expansion of capital goods production
34 SANDRA HALPERIN
for railway building, rapid technical improvement came, even here, only
when compelled by military competition and the modernizing armaments
industry.27
The Circuit of Capital: The Nineteenth Century Origins of

Contemporary Global Governance
Europes economy before World War II was based on the development of

external markets for heavy industry and high-cost consumption goods. By
expanding its shipbuilding, boiler making, gun and ammunition industries,
Britain was able to penetrate and defend markets overseas; this, in turn,
provided opportunities for Britain to build foreign railways, canals, and other
public works, including banks, telegraphs, and other public services owned or
dependent upon governments. British exports of capital provided purchasing
power among foreign governments and elites for these goods and services,
and funded the development and transport of food and raw materials exports
to Europe, thus creating additional foreign purchasing power and demand for
British goods, as well as decreasing the price of food, and thereby the value of
labour, in Britain.28 At the centre of this circuit was the City of London,
which like the advanced sector of a dependent economy worked to build
strong linkages between British export industries and foreign economies,
rather than to integrate various parts of the domestic economy.
The bulk of Britains capital exports between 1880 and 1913 went to the
Dominions, Europe, and the U.S. Almost 70% of it went into docks,
tramways, telegraphs and telephones, gas and electric works and, in par-
ticular the enormously capital-absorbing railways.29 Only the production
of modern armaments is more capital absorbing (the mass production of
armaments in the United States, and their export to Europes great and
small powers, began in the 1860s).30 Increasing blocs of territory through-
out the world became covered with networks of British built and nanced
railroads, provisioned by British steamships and defended by British
warships.
Throughout the circuit, both within and outside of Europe, the same
overall pattern of dualistic growth emerged, though with variations accord-
ing to each countrys place in the circuit and the type of goods it produced
for sale. France, whose empire, export earnings, and foreign investment
were second only to Britains, exported high-cost textiles and luxury goods
(e.g., silks, laces, wines, delicacies), built railroads in Russia with French
equipment and capital. Germanys dualistic industrial expansion took off
with its marriage, not of iron and nance as in Britain, but of iron and
rye, celebrated, in 1879, along with the enactment of an Anti-Socialist Law

and state legal enforcement of cartel agreements to limit production. In Italy
and Austria-Hungary, industrial development focused on expanding heavy
industry and gaining railway concessions in the Balkans.
Other states Russia, the United States, Canada, and Australia were
incorporated into the circuit as raw material producers. These increased
their production of agricultural and other raw materials exports to pay for
railways, iron and steel, armaments and other foreign manufactures. Russia
paid for these imports and its interest on its enormous foreign debt, by
steadily increasing agricultural exports even during famines (e.g., in 1891; in
1913, 74% of Russian exports consisted of agricultural produce and timber
(Munting, 1982, p. 31). Colonial territories that became independent states
as, for instance, states in the Balkans and in Latin America remained
within the circuit. Local elites, whether in colonies, former colonies, or states
that had never been colonies, imported British capital and goods, developed
mines and raw materials exports, and built railways and ports, in order to
extend, consolidate and maintain their power and become wealthy.31
Placing European imperialism in the context of this circuit and the overall
pattern of dualism that characterized economic expansion in the nineteenth
century, it appears that imperialism made it possible for elites to expand
production without the redistribution and reform necessary for the further
development of the home market. Imperialism was not only proposed and
advocated by the aristocracies and nobilities of almost all European coun-
tries in the nineteenth century, and the wealthy elites and governmental
ofcials connected with them;32 they were the most ardent one might say,
even, the only proponents of imperialism. The most active proponents of
imperialism were landowning and industrial elites who saw it as a means of
alleviating land hunger.33
Financial houses acquired inuential newspapers in European cities (e.g., in
Berlin, Vienna, and Paris) in order to popularise the notion of the need for
and glory of acquiring access to or ownership of overseas territories (Hobson,
1902, p. 60). Despite such efforts, however, popular enthusiasm for impe-
rialism remained limited throughout the nineteenth century. In Britain
public interest became evident only from 1894, and then it was a spasmodic
reaction to specific overseas issues rather than a consistent expression of
nationalist or racialist idealism (Fieldhouse, 1973, p. 75). The public in
Germany regarded imperialism with indifference, though sometimes after a
spectacular victory the public ared into a collective but brief enthusiasm
which was quickly doused by irritation over expenses and losses in these
far-off places. In France, [t]here existed no genuine colonial consensus;
36 SANDRA HALPERIN
the extensive and costly empire remained a permanent object of discus-

sion (Wesseling, 1997, pp. 45, 25).
In Lenins view, the upper stratum of the working class had been politically
corrupted by imperialism (1939, p. 64, 67). However, at least in Britain, this
appears not to have been the case. In an investigation of working class at-
titudes towards imperialism, Henry Pelling found that, of the dozen trade
union leaders who were in the House of Commons at the start of the South
African War, only one (Havelock, Wilson), took the imperialist side; none
of the nine trade union leaders in the new Parliament elected in 1900 sup-
ported the war (1968, pp. 8283). Richard Price (1972) concluded, in a later
study, that Britains empire mattered little to the working classes, as did
Alfred Williams, in an earlier study (1911, p. 157).
It was the conviction of many authors that the prosperity and political
and social stability enjoyed by the great colonial powers was connected
with their overseas possessions (Wesseling, 1997, p. 41; see also Wehler,
1969). However, by the eve of World War I, the extremes of wealth and
poverty created by dualistic economic expansion were generating more or
less continual conicts (see Halperin, 2004, Chapters 4 and 5). Britain, in
1914, was a divided country, in which extremes of wealth and poverty
coexisted, often in a state of mutual fear and incomprehension (Floud,
1997, p. 7). In 1913, less than 5% of Britains population over 25 years of
age possessed over 60% of the wealth of the country (Clough, 1940,
pp. 672673). Though the population of Britain had become on average
nearly three and a half times richer between 1830 and 1914, the range of
incomes around the average did not significantly diminish; the rich remained
much richer than the average, the poor much poorer up to a third of the
population in 1914 had incomes which did not provide them with sufcient
food to sustain health throughout the year (Floud, 1997, pp. 3, 15).
Moreover, While 30% lived below the margin, perhaps a further 40% or
even more lived so close to the margin that they could be, and often were,
forced below it by a variety of life events.34 Wages rose sharply between
1905 and 1913, but the gain was offset by a strong increase in the cost of
living and by a wide range of social and economic factors (Perrot, 1986,
p. 104; Benson, 1989, p. 56).
By 1914, tensions were rising not only within European states, but among
them, as well. As more and more countries began pursuing dualistic, ex-
ternally oriented economic expansion, conict over territories in Africa and
Asia increasingly threatened to lead to war. At the same time, expansionist
aims began more and more to focus on Europe itself and, as they did,
Europes balance of power and imperialist regimes began to dissolve.
WHAT CHANGED AND WHY

As more and more countries began to pursue dualistic, externally oriented
economic expansion, competitive rivalries began to sour relations among
European ruling groups. Perhaps the most thoroughly explored instance of
this was the dissolution of Germanys relations with other European pow-
ers. In the last decades of the nineteenth century, the expansion of the
German naval eet put a strain on Anglo-German relations; while the
adoption of tariffs that closed the German market to Russian rye soured
relations with Russia. At the same time, and with opportunities to expand
overseas quickly diminishing, the expansionist aims of European powers
began more and more to focus on Europe itself. Networks of British built
and nanced railroads already covered overseas territories; but, after 1870,
an upsurge in European railway construction began, France built railroads
in Russia, German steel and capital built the Baghdad Railway; Italy and
Austria-Hungary competed for railroad concessions in southeast Europe so
that, as 1914 approached, there was something of a railroad war between
Italy and Austria-Hungary in the Balkans (Kurth, 1979, p. 21). Rivalry and
rising tensions in Europe led to the dissolution of the Bismarckian Sys-
tem; and this, along with the antagonism created by German naval build-
ing, led to the reconguration and increasing polarization of interstate
relations in Europe.35 The European balance of power and imperialist re-
gimes began to dissolve. By 1914, war appeared to be the only means by
which national capitals could improve the terms on which they were
integrated into the world circuit of capital.36
The threat of a multilateral imperialist war in Europe forced governments
and ruling elites to do precisely what a century of overseas imperialist ex-
pansion had enabled them to avoid, mobilize the masses. As a result, the First
World War succeeded in bringing into conict the two central features of
Europes industrial development internal restriction and external expansion.
In the eighteenth century, governments had relied on the social elite to
pay for mercenary troops and to provide military leaders to ght profes-
sional wars. The impact of these wars on the social order had been relatively
limited, as they tended to reinforce the status quo by heightening existing
social inequalities. However, the wars fought by Napoleons mass citizen
armies and the mass armies mobilized to ght against them, had very dif-
ferent consequences. The participation of the lower classes in the war effort
and in areas of work and social life usually barred to them, worked to
enhance the power of labour and to strengthen its market position. It also
compelled governments to ensure their loyalty by extending to them various
38 SANDRA HALPERIN
rights. Serfdom was abolished in Prussia concurrently with Steins military

reforms, as it was in Russia when Alexander II transformed the army from a
professional into a conscript force. In Austria, the adoption of universal
military service coincided with reforms that established a constitutional
Monarchy (Andreski, 1968, p. 69).
Thus, after the end of the Napoleonic Wars, and despite the difculty of
raising and maintaining large mercenary forces, Europes use of citizen ar-
mies largely ended, and there was a return to old-style armies of paid pro-
fessionals, mercenaries, and gentlemen (Silver & Slater, 1999, p. 190). The
new weapon introduced by Napoleon was used in 1870 by France and
Germany, also with frightening consequences (the rising of the Paris com-
mune), and then not again until 1914.37
In 1914, aggressive imperialist threats on their frontiers forced European
states, once again, to use what was then still the most powerful weapon of
mass destruction, the levee en masse. The mass mobilizations for World War I
set in motion a social revolution that, between 1917 and 1939, swept through
all of Europe. The efforts of Western governments and ruling elites to prevent
its further spread and escalation led directly to the Second World War. At its
end, the region was wholly transformed. Previous regional conagrations had
been followed by restorations (e.g., the Napoleonic Wars, the revolutions of
1830 and 1848, and World War I); however, World War II, by shifting the
balance of class power throughout Europe, made restoration impossible. In-
stead, the vastly increased organizational strength and power of working
classes and peasant masses, and the decline of the aristocracy as a result of
wartime changes, created the conditions for an historic class compromise and
for the achievement in Western Europe of universal suffrage, a relatively more
nationally embedded capitalism (i.e., a more balanced and internally oriented
development) and, for a time, unprecedented growth and relative peace and
stability.
In the years leading up to the war, there had been a marked rise of socialist
parties and a steady and dramatic increase in the number of their members,
their candidates returned to representative bodies, and their share of the
popular vote. By 1914, labour violence was raising alarms in all the capitals of
Europe and social polarization and conict was evident throughout the re-
gion.38 Thus, even as they declared war, European governments were unsure
whether workers would voluntarily join the war effort, or whether oppressive
measures would be needed to induce them to participate. However, every-
where in Europe, industrial workers and peasants were inducted into national
armies and moulded into effective ghting forces. In some places they en-
thusiastically supported the war. In Britain, large numbers of working-class
volunteers signed up before conscription began in January 1916; by the

time volunteering ceased, nearly 30% of men employed in industry had
volunteered.
Many contemporary observers assumed that working class participation
in the war represented a victory of nationalism over Socialist solidarity (see,
e.g. Braunthal, 1967, p. 355; Schumpeter, 1976, p. 353; Carr, 1945, pp. 2021).
But labour struggles continued throughout the war and, in many places,
increased both in number and intensity; moreover, millions of European
workers participated in massive strikes and demonstrations in solidarity
with the Russian Revolution in 1917. In fact, the war proved to be a
watershed in the development of socialism and of organized labour in
Europe.39 At its end, left-wing parties and movements emerged throughout
Europe, and trade union membership skyrocketed as unskilled and agri-
cultural labour and women joined the ranks of organized labour for the rst
time.
By the end of World War I, labours wartime mobilization and partic-
ipation had increased its relative power within European societies. Through-
out Europe, the mobilization of urban working classes and peasant masses
to ght the war had produced stronger, larger, more united and better
organized urban and rural labour movements. Trade union membership
doubled in Britain (from 4 to 8 million; Geary, 1981, pp. 151155); in Italy,
it doubled during the war and nearly doubled again by 1920 (Maier, 1975,
p. 47). By 1920, Europe had 34 million trade unionists (Ogg, 1930,
pp. 759797). Skilled and unskilled workers, workers of different occupa-
tions, anarchists and socialists, Social Democrats and Communists, revo-
lutionaries and reformists closed ranks.40
In 1870, the lower classes had constituted some 75% of European society
of which, only about 15% were skilled workers (Gillis, 1977, p. 268). But, up
until World War I, the great landed families and their allies had been suc-
cessful in maintaining the social and political isolation of agrarian labour by
exempting their resident tenants and other workers from labour legislation
and preventing them from securing the right to organize.41 Thus, unskilled
labour had remained outside the ranks of organized protest almost every-
where before the First World War.42
Between 1914 and 1921, unskilled labour joined the ranks of organized
labour. Trade union membership doubled in Britain during the war. In
Germany, unskilled workers became active for the rst time during the
revolutionary upheavals of the post-war period. In Italy, the rapid expan-
sion of heavy industry in the war and immediate post-war period drew the
new factory working class into radical politics. Revolutionary protests and
40 SANDRA HALPERIN
strikes in the Balkans occurred only after World War I, and involved mainly
urban unskilled labour in the railway, mining, tobacco, and textile indus-
tries. After World War I, revolutionary activity in Poland, Hungary and
Czechoslovakia was carried out mainly by unskilled urban labour and by
peasants.
After World War I, peasant protest also emerged in new organizational
forms throughout Europe. In Germany, Austria, Romania, Yugoslavia,
Czechoslovakia, Poland, Hungary, Latvia, Estonia, Bulgaria, Lithuania,
and Finland, hordes of peasants who had fought in the war demanded the
abolition of large estates and the creation of peasant freeholds.
Given the growth, rather than diminution, of working-class activism and
organization after the war, it seems reasonable to assume that when the
working classes joined up with national armies, they did so to advance their
own struggle for economic and political rights.43 It was widely acknowl-
edged that the war could not be won if workers did not support it; workers
therefore had reason to believe that their patriotism and sacrices might win
them rights for which they had struggled for over a century.44 Their struggle
continued, both during and after the war; and, ironic or contradictory as it
might seem, socialist solidarity, as for instance in the strikes and dem-
onstrations throughout Europe in 1917, continued to be a means of
advancing it.
Following World War I, leaders and ruling classes in all western
European countries were committed to re-establishing the pre-war status
quo.45 Thus, despite the profound dislocations that the war brought, it took
a second massively destructive European war to make restoration of the
nineteenth-century system impossible. It was the demand for labour and
need for its cooperation for a second European war that compelled a po-
litical accommodation of working-class movements.46
A class compromise was concluded in Western Europe after World War
II on the basis of social democratic and Keynesian goals and policy instru-
ments. It required that social democrats consent to private ownership of the
means of production and that capitalists use the profits they realized from
this to increase productive capacity and partly for distribution as gains to
other groups (Przeworski, 1979, p. 56). Wages rose with profits, so that
labour shared in productivity gains, making higher mass consumption pos-
sible for new mass consumer goods industries. States administered the
compromise by resuming the welfare and regulatory functions that it had
relinquished in the nineteenth century. For the rst time parties representing
labour became legitimate participants in the political process. Socialists
regularly participated in coalition governments in Austria, Switzerland,
the Netherlands and the Scandinavian countries. Post-World War II devel-

opment in Europe was characterized by sustained growth rather than short-
lived windfalls, and by a more equitable distribution of income. No longer
based on dualistic expansion, it was the outcome of the performance largely
of the society itself rather than of foreign islands of capital. In contrast to
pre-war economic policies, post-war policies were designed to expand do-
mestic markets through increased production, rather than to divide up and
exploit national markets through restrictive practices; to encourage compe-
tition rather than cartelization; to raise the level of earnings and of welfare
of the working class, and to increase and regulate domestic investment.
THE RECONFIGURED CIRCUIT
The adoption of social democratic policies effectively ended the dualism that
once had characterized European economies. As a result, European econ-
omies expanded in ways that, after World War II, became associated with
First World and Second World development. However, the circuit of
exchange that had produced dualism in Europe endured and continued to
reproduce it elsewhere in the world. The survival of this pattern of devel-
opment was the result of a massive and coordinated campaign by Western,
newly independent, and developing states to eradicate social democracy
and consolidate dualistic structures throughout what became, as a result of
their efforts, the vast, global third world. Once socialism had been de-
stroyed in both the third world and the second world, Western states
began a campaign to reverse their own post-World War II social settle-
ments. The emerging trend, therefore, is of re-integration, of both the sec-
ond world and, eventually, the rst world, into a system of local and
trans-local relations similar to the one that, in those areas of the world, pre-
dated the crisis of the world wars and the great depression.
Nationalism and Dualism in the Third World
Within the circuit of exchange that linked dualistic economies around the
world in the nineteenth century, there emerged a struggle for power among
European ruling groups that culminated and came to a conclusion in the
two-phased war in Europe at the beginning of the twentieth century. The
crisis in Europe provided an opportunity for elites in states and territories in
other parts of the world to better their position within the circuit. Restricted
42 SANDRA HALPERIN
in their access to benets enjoyed by European elites and not fully accepted
by them, these elites sought to wrest a larger share of political power for
themselves. As had been the case with similar intra-elite struggles in Europe,
nationalism was used by these contending elites to articulate their demands,
win the support of the lower classes, and gain state power. And as had been
the case in Europe, in the newly independent states established after
World War II, these nationalist movements became fused with a program of
capitalist expansion that consolidated dualism.47
Thus, decolonization and nationalism did not mark the end of the circuit,
but rather the emergence of a modernized, more efcient form of it. The
nationalist elites who had won independence from the imperialist powers
were able to more effectively police local labor and consolidate different
systems for transnational and local interests and actors. Though they had
identied nationalism with national development as a means of legitimizing
themselves as a new ruling group, the association of nationalism with de-
velopment was, in fact part of a broad vision that they shared with retreat-
ing colonial administrators and with a wide set of transnational elites
concerned with maintaining and reproducing the circuit.
Once in control of state power, nationalist elites continued to build up
export industries and continued, within restricted foreign-oriented enclaves,
to accumulate wealth and enjoy Western standards and styles of living
without transforming their largely traditional and non-industrial economies
and societies.48 They purchased masses of weapons from Britain and the
U.S. to protect these enclaves so that local elites could continue to accu-
mulate wealth safe from the mass misery growing up around them. Even-
tually, in Britain and America, and after they had become the worlds two
largest weapons exporters, expanding military-industrial complexes began
to draw industrial capital from the mass-consumption goods sector and to
free it from the need to maintain mass purchasing power. As a result, wage
levels and work conditions began to erode, along with other gains which
labour had made in those and other Western countries as a result of the
post-war social settlements.
The Acceleration of Capitalist Globalization
By the late 1970s and 1980s, the global crusade to contain the spread of
socialism around the world had succeeded to a phenomenal degree. Western
states then began a forceful campaign to reverse the social settlements that
had tied capital to the development of their own national communities.
Central to this campaign was the introduction of a series of measures de-

signed to dis-empower labour and undermine democracy at home.
At the time Keynesian social democratic compromises were concluded in
Western Europe, the United States had already adopted fordism. Fordism,
which had been introduced in the U.S. during the Great Depression, had
required far less of a concession by capital than did the compromise in
Europe. The U.S. had already made the shift to mass production and con-
sumption when it adopted fordism, having poured its steel into its own
railroads, and then into automobiles;49 and it had enjoyed a higher level of
domestic investment. Consequently, the U.S. economy had grown faster
than Western European economies (Schoneld, 1965, pp. 56).
As a result of both these factors and of the world wars, U.S. industry had
few competitors. Consequently, the higher wages conceded as part of the
fordist compromise could be paid for by higher prices. Because it had few
competitors, U.S. industry could also add capacity relatively cheaply.
Moreover, the Keynesian policies that formed part of the fordist compro-
mise functioned as a welfare program for the mass production of armaments
which had begun in the U.S. in the 1860s and, thereafter, had become an
increasingly important part of the U.S. economy. However, as international
competition from Europe and Japan intensied, profit margins in the U.S.
began to narrow, and U.S. business became increasingly committed to es-
caping the implications of the fordist compromise in a sealed-off domestic
context.50
By the late 1970s, and in the context of a new opportunity structure (the
combination of the decreased threat of socialism and increased international
competition), the U.S. and Western European states began to dismantle the
restrictions and barriers on capital mobility that they had imposed after
World War II and to restructure or eliminate regulatory agencies and social
welfare programs. The result of these measures has been an expansion of the
export-oriented growth that characterized the pre-world war international
political economy. U.S. capital exports since the late 1970s differ in a
number of ways from those that had characterized the outow of U.S.
productive capital to Europe and elsewhere after World War II. Before
the 1970s, U.S. capital exports were relatively small (British capital exports
in the nineteenth century had amounted to 10% of GDP; at their peak,
those of the U.S. had been around 2% of GDP). U.S. rms had invested in
Europe because it was the only way to access European markets given [t]he
sharp drop in the trade share of GDP that occurred in Europe subsequent to
the depression, the persistence of capital and currency controls, and the
presence of substantial non-tariff barriers.... Moreover, these investments
44 SANDRA HALPERIN
had supported an overall system of welfare, income equality, and higher

wages at home. While rms fought for market share overseas, they did so
in ways that boosted workers incomes and domestic demand rather than
suppressing those incomes (Schwartz, 20022003, pp. 4041).
The U.S. capital exports that began in the late 1970s, however, are part of
an overall shift that involves downsizing work forces and resetting corporate
activity at ever lower levels of output and employment (Williams et al.,
1989, p. 292). In fact, despite the tendency to refer to current trends col-
lectively as neo-liberal globalization, the expansion underpinning glo-
balization has been, as was Europes nineteenth century expansion,
essentially anti-liberal in nature. It is characterized by increasing concen-
tration and monopoly, by the increasing tendency of large rms to buy
existing assets through mergers and acquisitions rather than to build new
ones (Williams et al., 1989; Nitzan, 2002, p. 241).
An economic development process involves accumulation of capital and
the employment of more personnel to increase productive capacity. This can
be achieved either by expansion a simple multiplication of the capacity at a
given moment or by intensication, i.e. an improvement in production
techniques. Before World War II, economic development in Europe pro-
ceeded principally by means of lateral gains, through the acquisition of
spheres of interest, rather than intensive gains, through improved organ-
ization or productivity. Similarly, U.S. expansion today is proceeding not
through the creation of additional capacity, but by lateral gains: by squeez-
ing other countries rms out of their markets, restructuring those markets
and integrating them into U.S. commodity chains; and, increasingly, as
Nitzan (2002) has argued, through buying existing assets through mergers.
With the increase in capital mobility and foreign investment, has come the
ability to move production to low-wage areas. This has reduced the bar-
gaining power of labor relative to capital in negotiations that determined
wages and working conditions, not only in industries experiencing capital
outow, but in related industries, as well (Crotty & Epstein, 1996, p. 131).
As a result, methods of absolute surplus value production have returned:
intensifying work regimes, reducing real wages, cutting health, pension, and
social safety net protections; and restructuring employment away from full-
time and secure employment into part-time and insecure work.
The overall trend to which all this points is to a reconguration of the
circuit of capital, once again. It was recongured after World War II to
accommodate social democratic concessions in the West. Now it may be in
the process of a reconguration involving the re-integration of both the
second world and much of the rst world into the circuit on the basis of
the dualistic growth that characterized their development previously and

which, throughout the post-World War II era, had continued to characterize
the development of the third world.
CONCLUSIONS
The eminent historical comparativist, Karl Polanyi believed that the great
transformation that occurred in the course of the world wars from free
unregulated markets to welfare states represented a permanent change, both
in the nature of the international system, as well as in its constituent states.
But Polanyi did not live to see the beginning of the rise, once again, of the
unregulated market. Had he done so, he perhaps would have seen the rise
and demise of Europes nineteenth-century system, not as a once-and-for-all
occurrence, but as part of an on-going struggle over the distribution of costs
and benets of industrial capitalism. It is a struggle, previous sections suggest,
that continues today.
Though the free market and the laissez-faire state gave way, in varying
degrees, to regulated markets and interventionist states after World War II,
the liberal international order survived. The hybrid system that this created
has been characterized as one of embedded liberalism (Ruggie, 1982).
It was, in fact, Polanyis analysis of Europes nineteenth century market
system (in The Great Transformation, 1944) that inspired the notion of
markets as embedded and dis-embedded. Polanyi argued that, before the
rise of the unregulated market system at the end of the eighteenth century,
exchange relations were governed by principles of economic behaviour
(reciprocity, reallocation, and house-holding) that were embedded in so-
ciety and politics. At the end of the eighteenth century, however, states
began to institute changes that formed the basis of the dis-embedded cap-
italist development that characterized Europes nineteenth century indus-
trial expansion.
The collapse of the nineteenth century system and the conclusion of a
compromise between capital and labour, led to the re-embedding of
European economies after 1945. Welfare reforms partially de-commodied
labour, and by means of market and industry regulation, investment and
production were made to serve the expansion and integration of national
markets. Now, however, a campaign to promote the dispersal of capital
investment and production to foreign locations the current globalizat-
ion campaign is seeking to reverse the post-World War II compromise
and to dis-embed national markets, once again.
46 SANDRA HALPERIN
In the history of capitalism, then, there have been phases of nationally

embedded and global free market capitalism periods when capital is rel-
atively more or less free from national state regulation. Markets were em-
bedded until the end of the eighteenth century; after that, and throughout
the nineteenth century, they were dis-embedded; then, after the nineteenth
century system collapsed in the course of the world wars, a compromise was
concluded which resulted in markets being re-embedded. Today, efforts are
being made to reverse this compromise and to return, once again, to the dis-
embedded capitalism that characterized nineteenth-century Europe.
NOTES
1. See, e.g., Coates (2000), van der Pijl (1998) and Moore (1966). Alexander
Gerschenkron (1962) argued that the later industrializers in Europe tended to favour
authoritarian government as part of an effort to mobilize capital and repress wages.
2. In Britain, an open land market meant that new wealth did not challenge old,
but simply bought a landed estate. At the same time the younger sons of landowners
were joining the merchants and professional men (Morris, 1979, p. 15).
3. Within this class, landlords remained dominant. Despite all that had been
written about industrialists replacing landowners as the dominant element in the
ruling elite, as late as 1914 industrialists were not sufciently organized to formulate
broad policies or exert more than occasional inuence over the direction of national
affairs (Boyce, 1987, p. 8). Until 1914, non-industrial Britain could easily outvote
industrial Britain (Hobsbawm, 1968, p. 196).
4. Boyce (1987, p. 11). That elements of Britains capitalist class were beginning to
consider the possibilities of the U.S. model was apparent from discussions of the U.S.
experience during the 1920s and, in light of that experience, the importance of the
home market for British manufacturers, and the need to reconsider Britains ap-
proach to foreign lending and its reliance on overseas markets. On this see, e.g.,
Boyce (1987, pp. 102105).
5. In 1897, 175,000 people owned ten-elevenths of the land of England, and forty
million people the remaining one-eleventh (Romein, 1978, p. 195).
6. Hobsbawm (1968, p. 169). Friedrich Engels observed that, in the last decade of
the nineteenth century,
[e]verything connected with the old government of the City of London the constitution
and the administration of the city proper is still downright medieval. And this includes
also the port of London [which has] in the past seventy yearsybeen delivered up to a
small number of privileged corporations for ruthless exploitation (1971[1889], p. 396).
7. Despite its reputation for cosmopolitanism and the fact that, in the last decades
before 1914, the rare dynamic entrepreneurs of Edwardian Britain were, more often
than not, foreigners or minority groups Jews, Quakers, Germans, Americans the
City was operated by men of English or Scottish stock and members of the estab-
lished church (Boyce, 1987, p. 20).
8. Far from the bourgeoisie having overthrown the aristocracy, we have instead
the aristocracy becoming the bourgeoisie (Wallerstein, 1991, p. 58).
9. Many historians assume that England did not experience a form of state cor-
responding to the absolute monarchies of the continent because English monarchs
could not take the property of their subjects without their consent in parliament. But
continental absolutism was also based on the rights of property.
The term absolutism was used by those who opposed state policies and
reforms that today we associate with the welfare state and progressive liberalism.
Conventional accounts of this history assume that opposition to absolutism was
principally concerned with a variety of freedoms. However, the record of the
states that emerged with the defeat of absolutism provides little, if any, support
for this view.
10. British exports increased 67%; production for the home market increased
only 7%.
11. See, e.g. Mann (1988), Mattingly (1955), Pirenne (1969, 1958), Stubbs (1967),
Granshof (1970), Hill (1905), Balch (1978) and Strayer (1970).
12. The French nobility considered itself to be a nation consisting of an inter-
national aristocracy and separate from the French lower classes. See, e.g., the Comte
de Boulainvilliers, Histoire de lAncien Gouvernement de la France, 1727, Tome I;
Albert Thierry, Conside`rations sur lhistoire de France, 5th ed. Paris, Chap. II; and
the Comte Dubuat-Nanc- ay, Les Origines de lAncien Gouvernement de la France, de
lAllemagne, et de Italie, 1789. After the outbreak of the French Revolution, the
French nobility tried to form an internationale of aristocrats in order to stave off the
revolt of those they considered foreign enslaved people.
Eric Hobsbawm writes that in the 1780s and throughout Europe townsmen were
often physically different from peasantsy . Even townsmen of the same religion and
nationality as the surrounding peasantry looked different: they wore different dress,
and indeed in most cases (except for the exploited indoor labouring and manufacturing
population) taller, though perhaps also slenderer (Hobsbawm, 1962, pp. 28). On the
eve of World War I, the impoverished masses crowding the slums of London and other
European cities were so stunted and wizened by illness and poverty as to appear as
another race to upper class observers (Floud, 1997, p. 14).
13. For much of the nineteenth century, the advanced sectors of European and
other economies developed, less through direct competition with each, than by
means of a mutually reinforcing circuit of investment and exchange. See Halperin
(2004, Chapter 3).
14. During the century, there was a marked improvement in the variety and
quality of household furnishings, decorations, and luxury items among artisans
and farmers. In fact, a greater proportion of the population than in any previous
society in human history was able to enjoy the pleasures of buying consumer
goods and not only necessities, but decencies, and even luxuries (McKendrick,
Brewer, & Plumb, 1982, p. 29; see also Thirsk, 1978).
15. In the nineteenth century, Britain devoted a substantially smaller proportion
of her national output and savings to home investment than did any of her major
48 SANDRA HALPERIN
competitors (Floud, 1981, pp. 1217). In 1913, one-third of Britains net wealth was
invested overseas. Never before or since has one nation committed so much of its
national income and savings to capital formation abroad (McCloskey, 1981,
p. 143). At the height of the Marshall Plan in 1947 the level of U.S. foreign invest-
ment as a share of national income was around 3% (McCloskey, 1981, p. 144).
16. Barratt Brown, 1970: x. See, also, Davis and Huttenback, 1988. For similar
arguments concerning Germany, see Wehler (1969), for France, see Langer (1931)
and Wesseling (1997).
17. Davis and Huttenback, 1988. In some respects Londons institutions were
more highly organized to provide capital to foreign investors than to British indus-
try. Committee on Finance and Industry, Macmillan Report (1931, p. 171). Capital
owed between London and the far reaches of the Empire, but not between London
and the industrial north. As Charles Kindleberger describes it,
A limited number of rms in a limited number of industries could get access to the
London new-issues market railroads, shipping, steel, cotton (after 1868), along with
banks and insurance companies. And some attention was devoted to renancing existing
private companies. For the most part, however, the ow of savings was aimed abroad
and not to domestic industries (Kindleberger, 1964, p. 62).
18. Lenin (1939) and John Hobson (1902) contended that Britains foreign in-
vestment and that of other advanced countries was a result of a super-abundant
accumulation of capital and the consequent pressure of capital for new elds of
investment. The notion that advanced countries had capital-saturated economies,
was current at the time they wrote and has since been embraced by a wide variety of
theorists and historians.
19. See, e.g., Trebilcock (1981), Lewis (1972, pp. 2758), Cameron (1961, pp. 123,
152), Cairncross (1953, p. 225), Levy (19511952), p. 228; and See (1942, p. 360).
20. Though Lenin recognized that profitable investment opportunities could be
provided with an adequate and sustained rise in the consumption of the masses
this was, for Lenin, only a theoretical possibility to be dismissed as utterly incom-
patible with the real balance of power in any capitalist society (Strachey, 1959,
p. 117).
21. Bairoch (1993, p. 172). The minerals prominent in tropical trade today did not
come to the fore until the end of the nineteenth century. In 1913, minerals were
prominent in the exports only of Peru and Mexico (Lewis, 1978a, p. 201). Moreover,
throughout the nineteenth and early twentieth centuries (until around 1920), terms of
trade were unfavourable for Britain (see Strachey, 1959, pp. 149151) and improved
for the less developed countries. It was only after World War II (in the 1950s, and
again in the 1980s) that terms of trade in primary goods deteriorated (Bairoch, 1993,
pp. 113114). The exception and, as Arthur Lewis points out, it is an important one
for Latin America (and for arguments to be developed, below, concerning cheap
food imports) is sugar which, relative to manufactured goods, deteriorated by
2535% between 1830 and 1910.
22. Belgians King Leopold compared Africa with a magnificent cake suggesting,
as Wesseling points out, that it was a luxury rather than a necessity (Wesseling, 1997,
p. 92). Bismarck, in a speech to the Reichstag on 26 January 1899, said of the German
colonists in Africa: They cannot prove that it is useful for the Reich. I, however,
cannot prove that it is harmful to it, either (19241932, pp. XIII, 386; quoted in
Wesseling, 1997, p. 90).
23. That this was widely recognized is evident in the laws regulating consumption
that were found throughout history, in Europe and elsewhere, and persist in many
places throughout the world, today. Sumptuary laws restricting the personal con-
sumption of goods based on class and income, enacted in Europe between the fteenth
and eighteenth centuries were retained by many states well into the nineteenth century.
24. From 49 million tons in 1850 to 147 million in 1880.
25. There were 200,000 coal-miners in Britain in 1850, half a million tons in 1880,
and 1.2 million in 1914 (Hobsbawm, 1968, p. 116).
26. For example, the SiemensMartin open-hearth furnace (1867), which made it
possible to increase productivity; the GilchristThomas process (18771878), which
made it possible to use phosphoric ores for steel manufacture. With respect to the
latter, Britain continued to import non-phosphoric ores, and failed to exploit her
own phosphoric ore deposits until the 1930s.
27. See also Mathias (1983, pp. 373393). Mathias contends that arguments about
differences between earlier and later industrializing countries do not explain the fail-
ure in innovation and development, widespread in the British economy (1983, p. 375).
28. Britains industrial wage earners realized 5560% of their wage in the form of
food; the steady fall in prices of staple food imports after 1874 (grain, tea, sugar,
lard, cheese, ham, and bacon; Mathias, 1983, p. 345), allowed real wages in Britain to
rise until World War I. In Britain, the value of labour was reduced, not only by
importing cheap food from abroad, but by forcing workers to consume poorer
quality food, as, for instance, in Ireland, where the cost of feeding workers was
forced down by making them dependent on the potato crop for sustenance. The use
of the potato allowed workers to survive on the lowest possible wage. Thus for
nearly fty years a regular dietary class-war took place, with potatoes encroaching
on bread in the south, and with oatmeal and potatoes encroaching in the north
(Thompson, 1975, p. 145).
29. As did the bulk of French and Belgian foreign investment, 12% of British
investment went into extractive industries (agriculture and mining); only 4% went
into manufacturing (Edelstein, 1981, p. 73).
30. Dobb (1963, p. 296). Hobsbawm argues that, at least in the short run, railway
building in Britain had little to do with developing the domestic market. All indus-
trial areas were within easy access of water transport by sea, river, or canal, and
water transport was and is by far the cheapest for bulk goods (coal mined in the
north had been shipped inexpensively by sea to London for centuries). Moreover,
regularity of ow, and not speed, was the important factor in transporting non-
perishable goods; and this was supplied by water transport. In fact, Hobsbawm
argues, many of the railways constructed were and remained quite irrational by any
transport criterion, and consequently never paid more than the most modest profits,
if they paid any at all. This was perfectly evident at the time.... What was also
evident is that investors were looking for any investment likely to yield more than
the 3.4% of public stocks. Railway returns eventually settled down at an average of
about 4% (Hobsbawm, 1968, p. 111).
50 SANDRA HALPERIN
31. Some former colonies did not develop the sharp dualism that characterized
industrial expansion in Europe. In Australia, Canada, and New Zealand there was
no pre-existing landed elite, and the colonists displaced, overwhelmed or destroyed
prior inhabitants. In these countries, revenues were not used solely to enrich a tra-
ditional landowning class and their allies as they were in Europe and in Latin
America. In the United States, where a strong landowning class developed in the
south, a struggle between landowners and industrialists culminated in civil war and
the victory of the industrial capitalist bourgeoisie. More on this, below.
32. British, German, Italian, and Russian landowning elites were the most active
champions of imperialist expansion. Britains imperialists were the aristocracy, and
later the Tories (Barratt Brown, 1970, pp. 5354). Italian imperialism was promoted
by the church and the landowning nobility. In Germany, the most persistent and
zealous champion of imperial expansion were the landowners organized in the pow-
erful Bund der Landwirte and other agrarian groups in Germany, as well as the Pan-
German League, representing both the great landowners and the large industrialists
(see, e.g., Meyer, 1955; Wertheimer, 1924). The Russian nobility and large land-
owners represented by the pan-Slav movement championed the cause of Russian
imperial expansion (Mazour, 1955). Large industrialists also pressed for imperialist
expansion. Among the most inuential imperialists were representatives of iron and
steel and heavy industry (railroads and shipping), like Joseph Chamberlain in Britain
and Jules Ferry in France, and the large industrialists in Germany who, after the
1870s, joined with landowners in the Pan-German League (see, e.g., Langer, 1931,
Chapter 9).
33. The cause championed by Germanys big landowners and large industrialists
in the 1870s of acquiring additional Lebensraum in order to offset the land hunger of
the German masses, expressed a general theme of landowners and industrialists
everywhere in Europe.
34. Floud (1997, p. 24). A number of investigators of working-class life showed
that, in the decade leading up to the First World War, a significant proportion of the
population of England and Wales were living in poverty without recourse to poor
relief. Charles Booths survey of Londons East End in 1886 showed that over 30%
of the population had an income that was inadequate for their support (1889).
Seebohm Rowntrees survey of York in 1899 found 28% of the population was too
malnourished to work a normal day and their children could not be fed enough to
grow at a normal rate (1901, pp. 8687).
35. The dissolution of the Bismarckian system paved the way for the emergence of
two camps in Europe: the Triple Alliance and the Triple Entente. This new structure
heightened competition and tension and led to an accelerated arms race in Europe.
In these conditions, the Balkans took on a new significance: for if either power
combination made gains in the Balkans, it would achieve a decisive advantage over
the other bloc. In 1914, it was this, many historians argue, that motivated Germanys
unconditional support for Austria and Russias support for Serbia. Backing a po-
tential ally in a war to reacquire Alsace-Lorraine, France gave her support to Russia.
36. The crisis that culminated in a two-phased imperialist war in Europe provided
an opportunity for elites in states and territories in other parts of the world to better
their position within the circuit. Restricted in their access to benets enjoyed by
European elites and not fully accepted by them, these elites sought to wrest a larger
share of political power for themselves. As had been the case with similar intra-elite
struggles in Europe, nationalism was used by these contending elites to articulate
their demands, win the support of the lower classes, and gain state power.
37. The new weapon involved masses raised by universal conscription, armed
and equipped by large-scale state-intervention in industry (Howard, 1961, p. 9).
See, for an overview of this issue, Howard (1961, pp. 839). Russia conscripted large
numbers of men for the Crimean War; but contrast a description of the forces raised
for that war (Royle, 1999, pp. 9192) with the account of the French mobilization in
18701871 (and its connection to the rising of the Paris Commune) in Taithe (2001,
esp. pp. 613, 2228, 3847).
38. After the turn of the century, industrial disputes reached unprecedented pro-
portions. Bitter strikes swept France, Germany, Italy, Britain, Belgium, and Russia
during the 1900s. In France, the years from 1892 to 1910 were the most militant in
the history of the working class. There were over 1000 strikes per year after 1906. The
rst attempts to organize national stoppages came in 1906. In Germany, the number
of industrial disputes escalated from 1,468 strikes in 1900 to 2,834 in 1912 (Geary,
1981, p. 105). There were bloody strikes in Berlin in 1910 and in the Ruhr in 1912.
Between 1900 and 1914, strikes, strikers, and workdays lost in Italy were about eight
times higher than in the 1880s (Bordogna et al., 1889, pp. 223224). There were
violent strikes in Britain and Belgium in 1911, 1912, and 1913. In Russia, violence
escalated throughout the rst decade of the century.
39. Socialist parties came to power in Sweden (1920), Denmark (1924) and
Norway (1927); a Labour government took ofce in Britain in 1923; the Left tri-
umphed in France in 1924; in Belgium and Holland, socialists entered the cabinet for
the rst time in 1939.
40. James Cronin observes that, before the war, the distinction within the working
class between rough and respectable, between the skilled and organized and the
unskilled and unorganized, had been very real to contemporaries and was reected
in many aspects of politics and collective action. Following the war, however, a
variety of technical, social and economic processes conjoined to produce a working
class that was, if not more internally homogeneous, a least less sharply divided within
itself, and also more culturally distinct from middle and upper class society than its
Victorian analogue had been (1982a, pp. 121, 139).
41. Peasants who were part-time artisans were often radical in politics. But peas-
ants whose main contact with the outside world was the local church, accepted the
traditional order (Zeldin, 1977, pp. 127139). Unlike liberal capitalists, the feudal
lords had always felt an obligation towards their serfs in times of need (as Bismarck
pointed out). Moreover, in those places where peasants could hope to buy land, the
peasants saw the nobility as allies against the bourgeoisie in the competition for
landownership.
42. The July 1830 insurrection in Paris was staged by highly skilled workers in
specialist trades (see Pinkney, 1964). It was from the skilled workers, the top 15
percent of the working class, that the trade union leadership in Britain was recruited
beginning in the 1860s (Gillis, 1977, p. 269).
43. Hobsbawm has argued this view persuasively (1990, especially pp. 120130).
44. Workers were probably also motivated to join the war effort for the economic
security of army pay (Benson, 1989, p. 162).
52 SANDRA HALPERIN
45. As Philip Abrams observes, the very term reconstruction reected the am-
biguity of ofcial thinking in Britain. Though Ministers spoke as though the word
meant transformation...the original reconstruction committees had been set up...to
restore the social and economic conditions of 1914 (1963, p. 58). Socialist and partly
socialist governments that came to power in Germany, France, and Austria, were
brought down before they were able to effect any change in capitalist institutions.
46. Fascism and the sacrices entailed in defeating it effectively discredited the old
right throughout Europe. Thus, even where workers were not mobilized for the war
effort as, for instance, in France, the balance of political power after the war shifted
in their favour.
47. The elites who led movements for decolonization and national independence
were part of a transnational elite. Their concern was with their role in the overall
system rather than with vertical inequality (exploitation). As in Europe, in the
developing world, elites legitimized their claim of representing the people/nation
by asserting that the nation as a whole is locked into a vertical exploitative rela-
tionship with other nations.
48. The result, in the Middle East, is that the share of manufacturing in produc-
tion in 1990 13% was precisely what it was in the mid-1950s.
49. In 1914 there was, in the U.S., about 1 car per 35 persons; a level not reached
by European countries until the 1960s. By the 1920s, 30% of American steel went
into automobiles. This was an important factor in American isolationism before
World War II (Kurth, 1979, pp. 2728).
50. Van der Pijl (1998, p. 119). Wage increases had previously been paid for by
higher prices. But when international competition began to act as a constraint on
pricing in the 1970s, capitalists were caught in a profit squeeze between labour
keeping wages high, and foreign competitors holding prices down (Cox, 1987, p. 280;
see also Rupert, 1995, pp. 17778).
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281305.
CHANGING RURAL SCENARIOS
AND RESEARCH AGENDAS IN
LATIN AMERICA IN
THE NEW CENTURY
Norman Long and Bryan Roberts
ABSTRACT
The chapter identifies key components of the new patterns of farming and
rural livelihoods emerging in Latin America in the twenty-first century.
By the beginning of the millennium, most rural areas of Latin America
had become integrated into global agricultural commodity networks that
curtail the opportunities for small-scale, family-based farming and result
in two predominant types of production, the corporate large-scale enter-
prise suited to oils seeds and their derivatives, cattle or vegetables for
processing and the smaller commercially oriented farm producing market
garden products, fruits and wine. Both types of farms often form part of
commodity networks organized by domestic intermediaries, large-scale
supermarket chains, such as Wal-Mart and Carrefour, and foreign food
marketers. In addition to the multiplication of external commercial link-
ages, high levels of urbanization have increasingly blurred the distinction
between the rural and the urban. Off-farm work, including international
labor migration, is now an important source of rural livelihoods. This
context means that research needs to address the multiple interfaces that

ISSN: 1057-1922/doi:10.1016/S1057-1922(05)11003-8
57
58 NORMAN LONG AND BRYAN ROBERTS
now connect the different types of rural inhabitants with a wide range of
external actors.
INTRODUCTION
In this chapter, we aim to identify the key components of the new patterns of
farming and rural livelihoods emerging in Latin America in the twenty-rst
century. We do this conceptually as well as empirically through a review of
trends in agricultural production and illustrative case studies. Current rural
transformations in Latin America, more strikingly than in the past, blur the
distinction between urban and rural, undermine subsistence farming systems
and are marked by the absence of major rural development programs,
whether initiated by governments or emerging from coalitions of small-scale
producers and entrepreneurs. The rural population is now a small minority
of the total population of the Latin American region. Agriculture is heavily
embedded in national and international commercial circuits and depends on
an increasingly high level of technological inputs, including biotechnology.
In contrast to earlier periods when agrarian reform, rural social movements
and the revitalization of small-scale farming dominated national agendas,
today the integrated development of rural areas has become in most coun-
tries a secondary political and economic concern.
The preoccupation with planned development was central to the idea of a
sociology of rural development, which is rooted in the era of interventionist
policies (spanning the mid-1950s until the early 1980s). In this era, national
states, supported by international donors, attempted to stimulate economic
growth, improve welfare and alleviate poverty through the implementation
of planned development. In the countryside, this came to signify a number
of intervention measures: the transfer of modern technologies, the intro-
duction of new hybrid crop varieties, community development and coop-
eratives, land reform and resettlement programmes, and various small-scale
agricultural and non-agricultural income-generating projects.
Along with this almost unstoppable march of planned interventions came
the demand from donors and implementing agencies for sociologists and
anthropologists to provide background data and analysis, to undertake the
evaluation of projects in order to establish how far policy goals were achieved
and target groups reached, and to advise on issues of local participation.
This put rural sociology/anthropology and social development issues square-
ly on the applied policy map. Examples are the interesting early and con-
tinuing farmer-researcher based research carried out at the International
Changing Rural Scenarios and Research Agendas 59
Center for Tropical Agriculture (CIAT), Cali, Colombia (Ashby, 1996) and
the International Potato Center (CIP), in Lima, Peru (Rhoades, 1984).
This situation changed, however, following the oil price and national
economic crises of the early 1980s, when structural adjustment measures
were introduced to promote better management of national economies and
to install tighter scal and administrative control and accountability by the
state. The same policy criteria were, of course, applied at local level to rural
development projects, which increasingly looked to the gurus of economics,
administrative studies and sound management practice for help and legit-
imation, rather than to the softer social sciences. Economic efciency
carefully orchestrated to meet shifting market demand and improved
administrative practice would, it was assumed, generate improved economic
returns and good governance; and multiparty democracy and decentral-
ization policies would result in more effective grass-roots participation.
By the 1990s, some new elements had been added to this unfolding neo-
liberal policy agenda in an attempt to give it a more caring human face.
These concerned environmental problems and sustainable livelihoods, is-
sues of human rights and citizenship (including claims on the basis of gen-
der, ethnicity and migrant status) and the central role of social capital in
binding together civic groups and networks of trust. The ofcial rationale
for such policy additions was that of avoiding or compensating for the
excesses and social exclusivity of free market outcomes, and thus of pro-
tecting the poor both rural and urban.
Yet, despite such concessions to social development, the philosophy and
economics of neoliberalism has continued to occupy center-stage. Its prin-
ciples not only penetrate national policies and global concerns but also play
a role in shaping the perceptions and strategies of local actors rural and
urban in regard to livelihoods and the organization of economic life (Slater,
2004). Agriculture has become part of a global system of production cov-
ering a wider range of foodstuffs than ever before in which less-developed
countries are increasingly embedded.
Interwoven with these changes were additional constraints on rural life
brought by urbanization and globalization. We begin then with an overview
of the main demographic and economic trends affecting rural Latin America
at the centurys end. We emphasize the diversity of the region and the
differences between countries in their involvement in the global agricultural
economy. Although urbanization and globalization are radically changing
the nature of agriculture and of rural life, they are not doing so in a ho-
mogeneous direction. Also, political maneuvering and organization affect
outcomes, as do the adaptive strategies of local actors in the face of the
opportunities and constraints associated with globalization. We develop

these points more fully in subsequent sections.
THE CHANGING CONTEXT AT THE CENTURYS END
In a previous publication, we reviewed the evolution of the agrarian structures

of Latin America from 1930 to 1990 (Long & Roberts, 1994). We empha-
sized the partial nature of the agrarian transformations amidst a capitalist
development in agriculture that affected almost all countries of the region.
Plantation production, medium-scale commercial production and peasant
semi-subsistence agriculture co-existed in most countries. Only in a few
countries or sub-regions, such as Argentina, Uruguay and South-Central
Brazil, was production for national consumption or export profitable enough
to lead to a thoroughgoing commercialization of agriculture. Elsewhere,
peasant households provided temporary labor for the plantations and com-
mercial farms, foodstuffs for the growing cities and served as pioneers in
opening up new regions for settlement. In many instances, such as in the
south of Mexico and the Amazonian region of Brazil, these new areas were
subsequently colonized, often rst by small-scale producers who cleared the
land, and then by cattle ranchers or plantation agriculturalists.
The context within which these developments occurred was the rapid
urbanization of the Latin American region. Because of high birth rates, this
initially did little to alleviate population pressure on land in most countries.
It did, however, transform the nature of rural livelihood strategies, creating
new opportunities as well as new challenges. The creation of a substantial
urban market for foodstuffs enabled even small peasant producers to sell, at
times, directly in the urban marketplace. The dependence on monetary
income in rural areas increased as improved communications and the in-
terrelationships established through ruralurban migration brought indus-
trialized foodstuffs and other industrial products into the village. This made
off-farm work, often implying long-distance and even international migra-
tion, an increasingly important part of the rural economy. Additionally,
state policies in many Latin American countries had an urban bias that
favoured urban residents through food subsidies at the expense of rural
producers (Lipton, 1977; Grindle, 1986).
The changes in this context at the centurys end are largely associated with
the adoption in most Latin American countries of neo-liberal economic
policies, though these policies have varied in intensity and scope from
country to country. The generalized and relatively rapid adoption of these
new policies in the 1990s was based on external indebtedness and the con-
sequent dependence of countries on the policy remedies of the multilateral
agencies, particularly the International Monetary Fund, the World Bank
and the Inter-American Development Bank (see Gwynne & Kay, 1999).
Several implications of the new economic and political context are impor-
tant for the discussion that follows.
Tariffs protected large- and small-scale enterprises from competition
during the period of Import Substituting Industrialization (ISI), whereas
free trade has brought considerable competition from foreign imports in
both manufacturing and agriculture. The resultant emphasis on increasing
productivity to meet competitive pressures has tended to displace labor and
to make it more insecure in both manufacturing and agricultural enterprises.
It has also led to an emphasis on new crops in agriculture that are more
competitive on the world market.
Whereas the state during ISI was both economically and politically na-
tionalist, had a national development discourse and often implemented
national development plans, particularly for rural areas, current ideology
leaves development to market forces, with the state exercising a regulatory
role. The state during ISI was highly centralized both in administration and
in the provision of key services, such as education, health and social secu-
rity. However, the dominant contemporary tendency is that of administra-
tive decentralization to provincial and local municipal governments, which
are also charged with the administration of health and educational services.
With increasing democratization throughout Latin America in the 1980s
and 1990s, local people have acquired more say in local governments, which
now have larger revenues and expenditures than in the past, although this gain
in resources is often counterbalanced by the withdrawal of central government
nancial support for local services and infrastructure. As Schuurman (1997)
documents, decentralization discourses are rampant and receive positive sup-
port from all quarters international nance agents, governments, the political
left, NGOs and peoples organizations as well as planners and applied social
scientists. The issue remains, however, as to how far such policies effectively
empower local groups and strengthen local forms of governance.
These economic and political changes have contradictory implications for
rural areas in Latin America. The income opportunities in agriculture are
now likely to be more concentrated than in the past, making it more difcult
for subsistence-oriented farmers to generate cash incomes. On the other
hand, small-scale farmers have more room for political maneuver to the
extent that they can inuence local government and the allocation of its
resources.
A further set of variations arises as a result of demographic changes

(Potter & Tuiran, 2005). There is a drop in human fertility throughout Latin
America that narrows the previous differences between high fertility coun-
tries such as Mexico and Brazil and low fertility countries, such as Argentina
and Uruguay. By 2000, Latin America had become a highly urbanized con-
tinent with some 75% of its population living in urban places (UNPD, 2004).
Though United Nations estimates are based on a minimal definition of ur-
ban (2,500+population or the administrative center of a district), Latin
American urbanization has been concentrated in large cities (100,000 and
over) and continues to be so in the contemporary period. High levels of
urbanization have been accompanied by a general decrease in the level of
population growth, although the Central American countries of Honduras,
Guatemala and El Salvador, and Haiti, remain at a level of 2% growth per
annum, and Paraguay and Venezuela in South America retain rates of over
2% per annum. By 2000, most countries are more than 60% urban with
Argentina, Chile, Brazil, Uruguay and Venezuela above 80% (UNPD, 2004).
The decline in the proportion of the rural population has been accom-
panied by a decline in the proportion of the agricultural labor force. Though
this decline has been constant throughout the period 19702000, it is only in
the last years that the absolute numbers of those working in agriculture have
in fact declined (Table 1). Excluding Mexico, Central America retains a
higher proportion working in agriculture than does South America; but
there are major differences between those countries that industrialized early
or rapidly and those that possess a weak industrial base.
The countries of the Southern cone t the category of early or fast in-
dustrializing countries, as also does Brazil and Venezuela, and have an
agricultural labor force that constitutes less than 20% of the total labor
force. The countries with a weak industrial based, mainly those of Central
America excluding Costa Rica, Mexico and Panama (whose development
was based on its commercial role vis-a`-vis the Canal), but including Bolivia,
Ecuador, Paraguay and Peru still have agricultural labor forces in excess
of 30% of the total labor force. The countries that retain a large labor force
in agriculture are also, it should be noted, those countries that have sub-
stantial indigenous populations: Bolivia, Ecuador, Guatemala, Paraguay
and Peru. We will return to this point later when we examine the new
ruralities in Latin America.
These demographic changes have the following consequences (Portes &
Roberts, 2005). Reduction in fertility, though more marked in urban areas,
combined with decreasing proportion of the rural population, results in
much less ruralurban migration than in the ISI period, and consequently in
Table 1. Evolution of the Agricultural Labor Force in Latin America,

19702000 Selected Countries (000s).
Country 1970 1980 1990 2000
No. % No. % No. % No. %
Venezuela 829 26.0 751 14.6 874 12.0 805 8.1

Argentina 1,495 16.0 1,384 12.9 1,482 12.1 1,464 9.8
Uruguay 207 18.6 192 16.6 193 14.2 190 12.6
Chile 715 24.1 800 20.9 938 18.8 980 15.8
Brazil 16,066 47.2 17,480 36.7 15,232 23.3 13,211 16.7
Nicaragua 350 51.1 393 39.6 392 28.6 396 20.0
Costa Rica 243 42.9 290 35.2 307 26.1 324 20.2
Panama 211 41.6 197 28.9 245 26.2 251 20.3
Colombia 3,080 45.1 3,776 40.5 3,696 26.6 3,719 20.4
Mexico 6,541 43.8 7,995 36.3 8,531 27.8 8,551 21.4
Ecuador 997 51.5 1,013 39.8 1,201 33.3 1,249 25.9
El Salvador 673 56.8 697 43.6 709 36.4 775 29.1
Peru 1,915 48.3 2,183 40.3 2,654 35.7 2,965 30.4
Honduras 580 67.4 684 57.2 693 41.4 769 31.7
Paraguay 409 49.8 514 44.8 595 38.9 706 34.3
Bolivia 872 55.1 1,064 52.8 1,249 46.9 1,497 44.2
Guatemala 1,106 61.1 1,257 53.8 1,569 52.4 1,916 46.1
Totala 36,289 42.1 40,670 34.3 40,560 25.2 39,768 19.5
% Rural 10,6399.2 42.3 11,3679.7 35.2 11,2316.8 28.7 11,2835.4 24.4
Source: FAOSTAT Population data, February 2004.
a
The percentages are the percentage of the total labor force that works in agriculture.
much lower overall rates of urbanization. The predominant forms of mi-

gration become urban-to-urban migration and international migration.
Urban growth ceases to be concentrated in one or two major primate cities.
There is a growth of intermediate cities and a more dispersed pattern of
urbanization. However, new forms of urban agglomeration emerge. These
are mega urban regions, such as the basin of Mexico City or the state of
Sao Paulo metropolitan constellation. These agglomerations contain a cen-
tral metropolis, which is the location of the headquarters of large rms and
specialized services, several more specialized industrial cities, and a peri-
urban hinterland of villages and small towns, which mix agriculture (often
market gardening) with crafts, services and outsourced production for for-
eign and national enterprises.
Urban labor markets appear less able to absorb migrants than in the past.
Levels of unemployment and underemployment are higher in the late 1990s
in Latin America than they were in the 1970s (Portes & Roberts, 2005). The
urban population is likely to be residentially less stable than in the past,
moving from city to town, to work abroad or back to rural areas. Urban-
ization is less hierarchically ordered than in the past, but the countryside is
extensively urbanized, even in vast relatively unexploited rural areas, such as
the Amazon (Browder & Godfrey, 1997). Most of the rural population now
lives in fairly close proximity to towns and transportation. The overall
consequence of these demographic changes is that the ruralurban divide
becomes even more blurred than in the past, making it necessary to recon-
ceptualize the nature of rural space in Latin America. Yet, the extent of this
blurring differs considerably by country and region within country, de-
pending on the extent of urbanization and the nature of the urban system.
What changes, then, have occurred in agricultural and livestock production
in these years and how do these create new challenges and opportunities for
the rural population? The following analysis is based on data on agricultural
production and import/export trade taken from the Food and Agricultural
Organization of the United Nations (FAO) statistical database (Faostat,
2004). Though trends vary by country, some central tendencies are apparent.
Areas under permanent crops and pastures have increased throughout the
region, especially in countries which have expanded their agricultural fron-
tiers, particularly Brazil. Areas under irrigation have also increased through-
out the region, most markedly in Mexico, Brazil and Chile. Agricultural
output has increased substantially and so has agricultural productivity. The
FAO estimate of the per capita production index (baseline 9901) for food
products shows an increase from 79.3 in 1970 to 103.5 in 2002.
At the same time, agriculture contributes a relatively small share to na-
tional GDPs, even in those countries that have developed a substantial
commercial agriculture such as Argentina, Brazil and Mexico. In Argentina,
agriculture contributed 4.9% of value added to the GDP in 2000, down from
5.3% in 1990. In Brazil, agriculture contributed 7.7% of value added in 2000,
up from 7.0% in 1990, and in Mexico, agricultures contribution was 4.5% in
2000, down from 5.5% in 1990. In all three cases, however, agricultures
absolute contribution at constant prices increased between the two years.
The political weight of landowners may thus be less than in the past,
particularly amongst those landowners involved in traditional cash-crop
production. Those involved in the new export crops, as we will see, have
strong links to global nancial and distribution interests and continue to be
key political actors at national and sub-national levels.
There has been a significant shift in the types of agricultural exports and
thus in the contribution of different agricultural products to GDP. In 1970,
the two major exports by value were coffee and tea (38.9%) and meats and
hides (15.5%), followed by fruit and vegetables, textile bers and cereals,
each of which accounted for just over 10% of export value (Chart 1). By
2000, the two major exports by value were oilseeds and their derivatives
(31.6%) and fruit and vegetables (26.8%). The categories of coffee/tea and
of meats/hides barely contributed 10% each of export value. Within
the category of fruits and vegetables, there is a substantial increase in market
garden crops for the urban consumer, such as asparagus, avocados,
tomatoes, chilies and peppers, cucumbers, grapes and onions. Non-agricul-
tural products, such as sh products and wood pulp for paper have also
increased their contribution to the regions exports. Fish products are sig-
nificant exports in Chile, Peru, Mexico and Ecuador, while wood pulp for
paper is important in Brazil and Chile.
The countries of Latin America differ considerably in terms of the crops
and livestock that they export. The major exporters by value are Argentina
Evolution of Agricultural Exports by Category(%)

40
35
30
25
%
20
15
10
0
1970 1980 1990 2000 2002
Year
Oils,Seeds & Feeds Dairy
Beverages Fruit & Veg
Cereals Meats & Hides
Coffee/Tea Textile Fibres
Tobacco
Chart 1.
and Brazil (21.7% and 32.9% of the regions total export value respectively
in 2002), both of which have shifted their exports away from their tradi-
tional ones, which were meat and cereals in the Argentinean case and coffee
in the Brazilian case. In both countries, oil seed and their derivatives, which
include vegetable oils and feedstuffs, are now the major exports (54.6% and
36.7% respectively of each countrys total exports by value in 2002) with
meat increasingly important in Brazil. Chile, in contrast, is an example of a
country that has dramatically increased its contribution to the regions ex-
ports moving from less than 1% of the regions exports by value in 1970 to
6.8% in 2002, but without substantially changing the prole of its agricul-
tural exports. As in 1970, Chile continues to specialize in the export of wine,
fruits and vegetables, taking advantage of tariff reductions to increase its
sales to northern markets. In addition, sh products and pulp for paper are
important contributors to Chiles exports.
Mexico presents yet another pattern. Overall, Mexico is one of ve Latin
American countries that import more agricultural products by value than
they export (El Salvador, Panama, Peru and Venezuela are the others).
Mexicos deficit is accounted for mainly by imports of meat and meat prod-
ucts (17.9% of imports by value), by cereals (15.8%) and by oil seeds and
their derivatives (15.8%). Mexico maintains a favorable importexport bal-
ance in fruit and vegetables, particularly in crops such as tomatoes, chilies/
peppers and other salad crops, most of which are exported to the U.S.
Distilled alcoholic beverages and beer have been other export success stories.
Peru shows similar tendencies, importing cereals and oilseeds and their de-
rivatives, but increasing their exports of non-traditional vegetables, especially
asparagus. Like Chile, Peruvian sheries make a substantial contribution to
exports. In general, then, imports of agricultural products increase in relation
to exports in most Latin American countries between 1970 and 2000.
The incidence of these trends differs between Latin American countries,
and so too does their impact. However, they point in similar directions. The
new forms of internal and external demand for agricultural products foster
two very different production systems in agriculture. One is the corporate,
large-scale enterprise suited to large-scale agricultural production such as oil
seeds and their derivatives, cattle or vegetables for processing. This type is
capital rather than labor intensive. The other is small, commercially oriented
farms producing market garden products, fruits and wine. This type has a
relatively high degree of labor input, technological sophistication and qual-
ity control. Both types of farms often form part of commodity networks
organized by domestic intermediaries, large-scale supermarket chains, such
as Wal-Mart and Carrefour, and foreign food marketers.
The two types of production systems can, and in the case of soybean
production in Brazil, do cater for the same crop. Which system predom-
inates often depends on political inuence and organization rather than
simply on economic viability. These production systems differ in their de-
mand for temporary and full-time labor, including gender and skill com-
position. They also differ in their local linkages in terms of service provision,
transport, manufacturing and processing industries. The linkage issue was
rst raised by Hirschman (1977) in his analysis of backward and forward
linkages and remains as relevant today for understanding the opportunities
opened up and the constraints generated at the local level by the new pro-
duction systems. The nature and extent of linkages are sources of difference
in rural livelihoods and affect the room for maneuver that different rural
actors have in the face of increasing agricultural globalization.
In researching these issues we should be careful not to operate with a
simple model that sees large-scale, often foreign, enterprises as closing off
local opportunities, while the smaller commercial production systems are
seen as more favorable to local development. In an earlier study, in the
Peruvian Andes, of the impact of a mining enclave on its surrounding re-
gion, we showed the multiple ways in which the presence of this large-scale
foreign enterprise stimulated the rise of smaller-scale local enterprises in
agriculture, trade and manufacturing (Long & Roberts, 1984).
The foregoing overview of the macro economic, demographic and polit-
ical trends suggests that the emerging rural sector in Latin America is far
from uniform. It is also sufciently different from the past in terms of the
nature of agricultural production and rural livelihoods to require a rethink-
ing of the analytical concepts needed for researching rural questions. Rural
spaces are now much less territorially bounded than in the past, more dif-
ferentiated, and more closely and diversely linked with external actors, both
national and international. The next section offers a preliminary attempt to
set out an appropriate conceptual and methodological agenda.
THE RISE OF NEW RURALITIES: CONCEPTUAL AND

METHODOLOGICAL ISSUES
Our starting point is the globalization of agriculture, but we emphasize both
the diversity and uneven nature of this process (cf. Buttel, 1994). From this
perspective, the impact of globalization on agriculture takes place through a
series of heterogeneous commodity networks based on different types of
food production and associated patterns of distribution and consumption.

We prefer the term commodity network rather than commodity chain
since our focus is on the multiple sets of actors involved, the differences in
their interests and values and the processes of competition and negotiation
present in their interaction. The actors in these networks are less circum-
scribed by territorial boundaries local, provincial or national than they
were in the past. Moreover, our use of the term, the new ruralities, is
intended to underscore the diversity of rural identities and livelihoods that
now exists in the countryside, even within the same geographical space. In
respect to these changes, there are four distinct components that we single
out as priorities for research.
The rst component concerns the ill-dened nature of rural space, which
nowadays, can no longer be considered coterminous with agricultural space.
This situation contrasts with that of the 1970s and 1980s when researchers
identied the central problems for analysis as the agrarian question,
namely the debate about the significance of proletarianization versus peas-
antization of the countryside. This was a major preoccupation of agrarian
social science, particularly in Latin America, during the 1970s and 1980s (see
Kautsky, 1899; de Janvry, 1981; Harriss, 1982; Goodman & Redclift, 1981;
and many articles in the Journal of Peasant Studies). In the contemporary
countryside, agricultural production can no longer be privileged over other
income-earning/livelihood activities and we should go beyond agricultural
production and resource issues to look more broadly at the utilization of
countryside resources. This means a concern for landscape and environ-
mental dimensions, for recreation and leisure time pursuits, and for the
management of forest and water resources, and similar amenities.
A second component of the new ruralities is the new limits on the extent to
which outside authorities or powerful groups can impose or dictate the
transformation of the countryside. The number of significant actors in-
volved in the countryside has grown, making it more difcult for any one
interest to predominate. The different actors involved peasant smallhold-
ers, indigenous people, commercial farmers, transnational companies, agri-
cultural bureaucrats, credit banks, various agrarian organizations, property
developers, and city folk moving into the countryside to enjoy a more rural
lifestyle all struggle to advance their own particular interests and to have a
say in what happens to rural resources in the short and longer term.
The organizational forms that result are complex and varied, since each
solution represents a specific conguration of interlocking actors projects
generated by the encounters, negotiations and accommodations that take
place between them, even though some may never in fact meet face-to-face
(Long & van der Ploeg, 1994; Long, 2001, pp. 4972). The inuence of
actors who are remote from the actionsituation is especially pertinent in an
age where information technology penetrates more and more into everyday
life. Many commercial farmers in poor countries now communicate through
walkie-talkies with their farm overseers or foremen in the elds, and possess
mobile phones and computers that can directly access foreign commodity
markets for up-to-date information on prices and product turnover.
And wage-earning migrants living abroad constitute an important source
of information, and their remittances subsidize incomes and livelihood ac-
tivities in their places of origin. An interesting example is the regular ow of
highly skilled shepherds from the remoter areas of highland Peru to work on
the sheep ranches of the mid-west of the U.S. They speak no English and
often little Spanish, yet their expertise is highly valued since it helps to
maintain high levels of reproduction and offspring survival among the
sheep. Unlike many international agricultural migrant workers, these work-
ers are legal, have three-year contracts and earn a regular dollar wage, part
of which they remit or save to invest in small-scale business and farming
ventures on returning home (Altamirano, 1991).
The limits on externally imposed transformations are reinforced by the
third component of the new ruralities. This is the importance of value con-
testation and construction, both socio-cultural and economic, in the oper-
ation of new global commodity networks. Here, research should focus
especially on the dynamics of these processes at the level of local producers
as well as on the transformation of values as commodities pass into the
arenas of processing, marketing, retailing and consumption (see Long &
Villarreal, 1998; Stanford, 2002 on avocados). For example, the organiza-
tion of marketing and retailing is not simply a matter of adding value to the
commodity. Rather it constitutes a series of interlocking arenas of struggle,
as we will illustrate in the Jalisco milk case, in which various parties may
contest notions of quality, convenience and price.
Undertaking a commodity ow analysis in terms of both practice and
discourse gives attention to the ways in which people organize themselves
around commodities and ascribe values to them (cf. Appadurais (1986) no-
tion of the social life of things). These contestations and negotiations usu-
ally entail the mobilization of arguments about what constitutes consumer
preference, the availability and advantages of particular technologies, and
issues relating to the material presentation of the commodity to its relevant
audiences (i.e., in relation to the supermarkets, small retailers, alternative
food shop owners, and an array of different consumer interests). Language
representations and the clashes that they invoke can also segment markets.
This is illustrated in respect to consumption preferences by the often-heated

debates that arise concerning food quality and extend to embrace issues of a
healthy diet, nutritional needs and environmental pollution.
Hence, as social constructs, commodities contribute to the development
of both markets and consumer life styles in contemporary society. A com-
modity approach, therefore, should give attention to how new alliances are
built between producers, distributors, retailers and consumers. These com-
modity networks can improve the bargaining powers of producer and con-
sumer organizations vis-a`-vis corporate global interests as well as those of
the often disempowered low- and middle-income nation states.
Emphasizing value contestation and construction also draws attention to
the continuing and innovative resistance to absorption into global com-
modity networks. This occurs when producers, consumers and agricultural
workers identify critical interests, both cultural and economic, as being
threatened or marginalized by outside markets and institutions. Such inter-
ests are often based on existing life styles or local forms of knowledge that
are seen as vital to a communitys identity and survival. This opens up a
related line of enquiry, namely, the exploration of the processes by which
people and their objects of desire generate certain cultural identications
that segment markets, create specialized demands for production and even
reduce the commoditization of the countryside.
Immigrant populations often generate these specialized demands. An ex-
ample is the extensive market created for corn husks grown by small-scale
farmers in Mexico, packaged by Mexican plants and then transported across
the border for the making of tamales in California (Long & Villarreal, 1998).
We also nd cases where farmers opt out of global commodity markets since
they judge that the benets of meeting ones own consumption requirements
outweigh any gains made through commoditization. One such case is that of
farmers in the Sierra Norte of Oaxaca in Mexico who prefer to consume and
exchange locally their native varieties of maize even though the costs of
production are above market prices (Appendini et al., 2003). In yet other
situations producers and consumers may commit themselves to the idea of
nding an alternative way through the formation of non-monetary exchange
systems, such as the trueque movement in Argentina, which at its highest
point in 2002 had an estimated 2.5 million members (Primavera, Covas, &
De Sanzo, nd.; Gonzalez Bombal & Luzzi, 2002). On the other hand, local
organizing practices and networks may contribute innovatively to the pro-
duction of high-quality commodities destined for less exploitative external
markets, such as, for example, those associated with the principles of fair
trade (see Whatmore & Thorne, 1997; Fisher, 1997). One further general
observation is that if intervening parties, such as multinational rms, the

state or retail organizations, fail to take seriously the ways in which people
mobilize and use resources through existing social networks and cultural
commitments, then they run the risk of being rejected by, or distanced from,
the life experiences and priorities of local producers. Hence, the importance
of studying how external market demands are internalized or modied by
local populations (Pottier, Bicker, & Sillitoe, 2003).
The fourth component of the new ruralities follows from the previous
one. This relates to the fact that nature, more than in the past, has come to
mean quite different things to different actors. It can no longer, therefore, be
considered the taken-for-granted backdrop to agriculture and rural life.
Recent research has documented the extent that local actors (e.g. peasants
and traders) and outsiders (e.g. agricultural extensionists, pollution ofcers,
conservationists and research scientists) differ in their assessments and pri-
orities, and in the way they represent natureman relations and the en-
vironment. And some researchers now call for the abandonment of the
commonplace distinction between the nature/man or nature/culture divide
in favor of the composite notion of social nature (Braun & Castree, 1998;
also see Ingold, 1986; Croll & Parkin, 1992; Ellen & Katsuyoshi, 1996).
Underlying these discussions is the more pragmatic question of what
measures to use in the management of so-called natural resources. Here, the
focus is on how the state attempts to control people and territory as against
how people in situ go about utilizing and conserving resources and bio-
diversity. Indigenous social movements, as we will see, have quite different
conceptions of their rights and relationships to territory than do national
governments, particularly when it comes to water, forest and subsoil re-
sources. In the current international context, governments are frequently
faced with the choice of implementing what are called centralized or de-
centralized modes of resource control the latter usually implying some
community involvement in natural resource management or the creation of
relatively autonomous national parks that cater for ecological tourism. It
remains an open question as to whether such decentralized modes of control
are, as Schuurman (1997) is inclined to conclude, a part of neoliberal dis-
course that contributes to the hollowing out of the state and to the fur-
therance of global forms of capitalist exploitation. Or is it a way of increasing
empowerment among local people in the management of their own resources?
Nowadays environmental policies are hedged round with a host of regu-
latory prescriptions of a global kind (for example, the Convention on Inter-
national Trade in Endangered Species (CITES) and the Convention on
Bio-Diversity (CBD), and subject to pressures from powerful conservationist
lobbies. As many studies have shown, the protection and conservation of

wildlife through the setting up of national parks or protected areas does not
necessarily ensure the continued preservation of natural resources and en-
dangered species. These environmental and biodiversity conservation issues
coupled as they are with a booming eco-tourism are critically important for
the future livelihoods of many rural inhabitants.
These components of the new ruralities raise a central methodological
issue. This concerns the need to bridge the evident disjuncture between the
sociology of rural development and ecological/environmental anthropology.
Whereas the sociology of rural development has generally focused on issues
of production, consumption and commodity values in the context of glo-
balization, ecological anthropology has principally concerned itself with the
conceptual issue of how to relate social-to-natural phenomena and has ex-
plored the epistemological understandings and cultural meanings associated
with social and environmental relationships. Clearly, there is a need to syn-
thesize these contrasting perspectives so as to achieve greater insight into
questions of diversity and change in the countryside.
As a preliminary exploration of these new ruralities and the research chal-
lenges they pose, we now present three illustrative case studies to highlight the
changes in rural landscapes and the options available to rural inhabitants.
RECONFIGURING RURAL SPACE:

THREE CASE STUDIES
The three cases analyzed below are illustrative of what we see as key issues
facing policy makers, researchers and the many other actors involved in the
new ruralities of Latin America. The cases highlight the conceptual issues
outlined in the previous section, namely the importance of value construc-
tion and contestation in the operation of new global commodity networks,
the limited extent to which transformations can be imposed externally, the
ill-dened nature of rural space and the multiple meanings attributed to
nature and countryside resources. All three cases illustrate the complexity
and multifaceted nature of the changes in rural livelihoods that result, di-
rectly or indirectly, from globalization. Despite similar external pressures,
the cases show that the direction of change is neither homogeneous nor
predictable. The play of politics, at both local and national levels, affects
outcomes, as also do the adaptive strategies of local actors and uctuations
in the global economy.
This is true even in the rst case, soybean production in Brazil, which is
an example of one of the most radical recongurations of rural landscapes
and livelihoods brought by large-scale export-oriented production. The sec-
ond case, milk production in Jalisco, Mexico, illustrates the increasing im-
portance of international standards of quality and safety for the survival of
even those enterprises that supply a domestic market. The third case looks at
the apparently paradoxical case of the revival of indigenous identities in the
face of economic liberalization and globalization so that they become an
important element of the new ruralities in Latin America.
The Case of Brazilian Soybeans
The major Latin America soybean producer is Brazil, whose 2003 produc-
tion of 51 billion metric tons approximated that of the USA at 66 billion
tons. Argentina is the second largest producer in Latin America, but, in
recent years, several Latin American countries have considerably extended
their soybean production, notably Uruguay, Bolivia, Colombia, Ecuador,
Guatemala, Honduras and Paraguay (Faostat data, 2004).
The impact of the change to soybean production on rural livelihoods is
both direct on the areas in which it is implanted and indirect through the
expulsion of existing rural populations. In Brazil, the conversion to soybean
production of large areas of Southern Brazil, such as the state of Parana,
resulted in an estimated net migration of 2.5 million displaced rural workers
in the 1970s (Martine, 1988; Mahar, 1989, p. 31; both quoted in Browder &
Godfrey, 1997, p. 168). Since 1980, the area under soybean cultivation has
risen from 8.8 million hectares to 18.5 million hectares, extending into the
Center-West states of the Brazilian Amazonia, such as Mato Grosso and
Mato Grosso do Sul (Flaskerud, 2003). By 20022003, soybean production
and soybean farms were larger in the Center-West of Brazil than in the
traditional Southern area of production.
Large-scale soybean production in Brazil is usually based on a no-till
system, particularly in areas of poor soil, which accounts for some 50% of
production, in which herbicides are used to limit weed growth. Though in
comparison to U.S. production systems, the large-scale farms in Brazil are
more labor intensive, they need only a fraction of the labor used in small-
scale farms. One estimate put the labor needs of a 30 ha ecological soybean
farm at 147 h/ha/year compared with 40.5 h for a 3,000 ha herbicide farm
(Ortega, Miller, Anami, & Beskow, nd). A 50,000 ha soybean farm in the
Center-West employs between 200 and 300 workers on a year round basis
(Flaskerud, 2003). Large-scale producers are closely allied to multinational

companies, such as Monsanto, for seeds and herbicides, or food and feed-
stuff companies, such as Archer Daniels Midland (ADM), for sales and
processing. Though Brazil has been one of the few countries to ban genet-
ically modied (GM) seeds, their use has grown in recent years and in 2004
they were permitted on a limited scale by the government (Rohter, 2003).
Monsanto produces GM seeds that are resistant to herbicides, facilitating
no-till production systems.
Nevertheless, small-scale soybean farming can survive in the face of large-
scale production. In fact, the small labor-intensive soybean producing farms
of between 30 and 300 hectares can be more profitable per hectare than the
large farms (Ortega et al., nd, Table 4). However, the scale of production of
the large farms drives down prices. The small soybean farmer gains little
advantage from the innovations in seed and herbicides since their produc-
tion systems usually include intercropping, which makes herbicide use in-
appropriate. In this situation, the introduction of genetically modied seeds
and the expansion of large-scale soybean farming have become a divisive
political issue in Brazil.
The Brazilian Landless Worker Movement (Movimento dos Trabalhadores
Rurais Sem Terra (MST)) was rst organized from the state of Parana, and
has become one of the major opponents of the introduction of organically
modied soy seed, lobbying government to prohibit their use and taking
direct action against Monsanto experimental stations (MST website). The
MST is also engaged in the resettlement of landless agricultural workers and
the development of production cooperatives. It produces organic soy seed and
runs soybean farms in Parana that produce high yields using conventional
seed. The MST supported the Workers Party candidate, Lula, in the 2002
Presidential elections in Brazil, but has since become an opponent of his
agricultural policies, including permitting the use of GM seed for soybean
production. Lulas justication has been the priority he gives to producing
food cheaply for the poor in Brazil and the role of soybeans not only in
generating export earnings but of providing feed for cattle and poultry
production. The MST does, however, cooperate with some of Lulas gov-
ernment agencies, notably the Institute for Colonization and Agrarian Re-
form (INCRA).
Brazils agrarian landscape is being substantially changed by its new
major agricultural products oilseeds & derivatives and meat & meat prep-
arations. Whereas the old agrarian heartland of Brazil, the states of the
Center-South and South of Brazil, account for a steadily declining propor-
tion of Brazilian agricultural production, those of the Center-West and
North, the Brazilian Amazonia, are expanding production and production

areas rapidly, increasingly at the expense of the Amazonian forest. Orig-
inally, the colonization of the Amazonia region was conceived by the mil-
itary governments of 1960s and 1970s as part of enhancing national security
by developing the frontier, providing land for migrants displaced from the
South and as a means of relieving land-pressure in the North-East (Browder
& Godfrey, 1997, pp. 6771). The transport networks established to facil-
itate colonization together with land grants and low land prices made the
Amazonia attractive to extractive activities, particularly lumber, but in-
creasingly to cattle-raising and subsequently to soybean production, creat-
ing a sequence in which small-scale farmers, timber extraction and roads
prepare the way for pasture, which when degraded, can be turned over to
soybean production. This sequence is a dynamic one since large-scale live-
stock producers sell their lands to soy production and move further north-
wards to new frontiers (Castro, 2004).
The small-scale farmers that rst colonized the area were often displaced by
the larger operators, either forcibly, by being bought out, or through the
failure of their enterprises. Poor soils, poor communications and lack of local
markets made small-scale farming relatively unprofitable. Even the basic
foodstuffs sold in small town stores in Amazonia were imported from the
Center-South of the country (Browder & Godfrey, 1997, pp. 281285). How-
ever, as Browder and Godfrey (1997) point out, these processes did not result
in rural landscapes totally dominated by large-scale farming and by surplus
extraction entirely for the benet of national and international corporate
interests. Rather, the development of the frontier gave rise to two distinct
patterns of urbanization a corporate and a populist urbanization (ibid.,
p. 100). In states like Rondonia, the inux of landless farmers from the South
coupled with the support of the Brazilian Institute of Colonization and
Agrarian Reform (INCRA) ensured that small-scale agricultural colonization
predominated. Timber extraction and small-scale mining helped power the
colonization process, but, from the beginning, it was based on a network of
small urban settlements closely integrated with agricultural and extractive
activities, often by the ownership of both urban and rural properties.
The pattern of populist development described by Browder and Godfrey
is one of a shifting and chaotic pattern of urbanization as old frontiers
are exhausted and new ones opened up leading to the decline of old urban
centers and the rise of new ones. However, it is a pattern of agrarian
development that appears able to sustain a relatively large population,
of whom few are specialized agricultural producers. Decentralization in
Brazil also supports this pattern of urbanization by mandatory transfers of
revenue from federal government to state and municipal government. These

transfers increase local revenues, giving local authorities more say in the
allocation of jobs in the social services and public administration.
Corporate urbanization, which Browder and Godfrey see as predomi-
nating in the state of Para, is based on large-scale projects construction,
mining and agriculture. These brought not only the workers needed for the
project, but a large number of migrants attracted by the prospect of the
economic opportunities being created. Currently, the driving force of cor-
porate urbanization is soybean production. Initially, this concentrated in the
non-forest areas, but with the expansion in demand, the new areas being
cleared in Matto Grosso are forest. The governor of Mato Grosso is a
member of one of Brazils largest soybean producing companies and ad-
vocates increased deforestation of the state to improve production (Rohter,
2003). Small and medium size towns arise to service the projects, such as the
town of Campo Verde in Mato Grosso, a center for soybean production,
storage and agricultural vehicle dealerships, with a population in the
municipality that grew from nothing to 30,000 in 15 years. The soybean
production and distribution system is also the basis for several intermediate
size cities in Mato Grosso, such as its capital Cuiaba with a population of
some 500,000, and the nearby city of Rondonopolis with a population
of 150,000. These towns often have a dualistic structure in which the pur-
pose-built housing of the workers in the projects contrasts with the informal
housing of temporary and service workers.
The Brazilian soy bean case shows the power but also the limits of eco-
nomic globalization. The rising worldwide demand for soy is an interesting
case of a newly valued food very popular as both a direct and indirect
(through animal feed) source of protein that originated in East Asia and
now is used worldwide. The demand for soy is transforming vast tracts of
the Brazilian countryside, including the deforestation of part of the
Amazonian forest. Note, however, that the triumph of large-scale produc-
tion systems in the Amazonian region is as much political as economic. The
profitability of soybean farming in Amazonia depends on government sup-
port in terms of the provision of cheap land and transport infrastructure, as
well as allowing deforestation and the use of genetically modied seeds.
Party politics ourish in Brazil and play an important part in shaping out-
comes, namely through the struggles of the landless workers movements
(MST) and the political maneuvering of the soybean lobbies at national,
state and municipal levels.
Even in the case of large-scale soybean production, the transformations
produced are uneven and partial because of the shifting and provisional
nature of soybean farming. This situation generates a variety of small-scale

opportunities. Poor transport infrastructure and the need to transport
products, such as soybeans, over large distances generate a demand for
small-scale commerce, repair, and food and lodging services. Entrepreneur-
ial opportunities emerge which can be combined with small-scale farming to
provide livelihoods. This Brazilian case also shows the analytic inappropri-
ateness of the ruralurban divide. The Amazonian population is highly ur-
ban, and even those extracting a living from agriculture maintain houses in
towns and more basic shelter in the rural hinterland.
Mexican Dairy Industry: The Case of Jalisco
Mexico provides a striking example of a Latin American country with a

marked deficit in the export of agricultural products. This trend has con-
tinued with the implementation of North American Free Trade Agreement
(NAFTA) and Mexico now imports large amounts of grains (even maize),
animal foodstuffs and milk products due principally to lower U.S. prices.
Mexico is presently the worlds leading importer of powdered milk: the
devaluation of the peso in 1994 and the economic crisis that followed led to
an overnight doubling of domestic market prices (Garcia-Hernandez, 1998).
One recent study argues (Rodr guez-Gomez, 1999, pp. 339340) that this
trend toward globalization brought about three contradictions in the inter-
nal market: the dairy industries preferred, because of cost factors, to use
imported powdered milk and milk derivatives; farmers had to face the
issues of high production costs and low wholesale milk prices; and the dairy
industries justied their use of imported goods in terms of the low quality of
Mexican products which did not meet international standards. In general,
the farmers blamed government and its incapacity to regulate imports and
to provide support for domestic producers for this deteriorating situation.
Another factor was that milk prices were kept at an articially low level to
benet urban consumers rather than farmers and rural consumers. After
1994, government policy vis-a`-vis milk consumption shifted from a system
based on price control to a social program aimed at supplying subsidized
milk to lower income groups (Lara-Covarrublas et al., 2003, p. 86).
Rodr guez-Gomez (1999) goes on to look in detail at the dynamics of these
processes in the state of Jalisco (see also the studies by Cervantes Escoto &
Soltero Beltran (2004) and Lara-Covarrublas et al. (2003)).
Jalisco leads the production of Mexican milk production (18% of the
total during the period 19901998). Most of this comes from the region of
Los Altos, which accounts for an incredible 13% of national production.

Early in the 1990s, the ministries of Agriculture and Commerce, together
with the social compensation programme (Solidaridad) joined forces with
the Los Altos-based regional and transnational dairy industries (e.g. Nestle,
Lechera Guadalajara, Parmalata) to encourage the formation of small- and
medium-scale farmers associations for the cooling and marketing of milk
cooperatively. A principal aim was to improve milk quality throughout the
region, but 90% of the dairy producers lacked the material and technolog-
ical basis for achieving this. The role of the dairy processing industries was
to persuade these farmers associations to purchase cooling tanks and mar-
ket the milk collectively. They also introduced a new graduated pricing
system based on a hierarchy of quality levels. In this way they sought to get
farmers to adhere to the standards of production set by international trad-
ing companies in accordance with their established quality criteria. This
entailed two processes: increased vertical integration of production units
with milk suppliers, and the production of so-called better quality and
safe milk at lower prices (Cervantes Escoto & Soltero Beltran, 2004,
p. 208). Yet, although these various industries collaborated with each other,
thus giving the impression that they were operating with the same concept of
quality, a whole series of discourses developed that favored specific def-
initions, commercial practices, and power relations between farmers, trad-
ers, agro-industrial enterprises and government agencies.
The issue of quality standards stimulated the organization of legally rec-
ognized dairy producers associations (sociedades de produccion) that had
ongoing contracts with particular processing companies for marketing their
total milk production. In return the industry promised to facilitate farmers
access to cooling tanks, either by providing them on loan or by offering
group credit for their purchase, but the companies retained the right to
reject milk that did not meet their quality standards and to determine the
prices they would pay. The state agencies also offered access to tanks and
credit, and in some cases assumed up to 40% of the costs of building the
tank and installing electricity and other utilities. However, despite all this
external investment in the promotion of quality-controlled milk production,
farmers in Los Altos initially showed a reluctance to opt for these new
arrangements.
The reasons for this were several. In the rst place, producers and en-
trepreneurs in this region have a reputation for ercely defending their in-
dependence vis-a`-vis central government and other outside interests
(Gonzalez, 1974). This attitude is deeply embedded in the history of the
struggles of the Cristeros conservative Catholic rebels, based in Los Altos,
who fought both the agraristas (i.e. protagonists of agrarian reform) and the
Mexican state in the 1920s (Meyer, 1974). This socio-political stance is still
evident in the contemporary politics and culture of Los Altos where eve-
ryday life and trust revolve around family and personalistic ties, and not
joint ventures with government or large corporate institutions. Hence farm-
ers were skeptical about the advantages of joining farmers associations and
shouldering collective and nancial and other arrangements. They reasoned
that this could endanger their own individual and family enterprises, and
perhaps the other economic activities in which they were involved. Never-
theless, many farmers associations came into existence, some effectively
combining both smallholder ejidatarios and private land owners. In the end,
while acknowledging the many difculties and insecurities that such changes
might bring, a majority of farmers voiced the opinion that they had little
alternative but to form these associations along the lines proposed by the
dairy processing industry, otherwise they stood to lose an important grow-
ing market for their milk.
On the other hand, farmers continue to sell in a wide variety of local
markets. For instance, fresh milk is sold on a door-to-door basis in the
towns of the region as well as to local cheese, butter, cream and local
sweet processors. The latter operate a variety of quality requirements that
t their own particular technologies. For the small-scale industrial con-
sumers of warm milk, such as the various artisanal creameries, quality
simply means the absence of water in fresh milk, whereas larger scale
processors equate quality with a certain milk temperature, approved levels
of solids and fat contents, absence of harmful bacterial materials, and
levels of acidity. The majority of dairy producers in Los Altos, therefore,
adopt a diversied production and marketing strategy that enables them to
supply modern quality-controlled milk for the dairy industry, while con-
tinuing to provide fresh, less standardized, varieties for the local process-
ing of cheese, butter, creams etc. Indeed, many farmers adamantly refuse
to acknowledge that the cooling of milk adds to its quality. As Rodr guez-
Gomez (1999, p. 351352) points out, But, farmers responses are as
contradictory and ambiguous as are the processes of social, material, cul-
tural and power transformation brought by the standardization of this
cultural form.
Nowadays Jalisco boasts more than 330 dairy farmers associations, but
this does not imply that modern quality-controlled milk production now
constitutes the central dynamic of family farming in Los Altos. In addition
to dairying activities, these same farmers are involved in a variety of on- and
off-farm work, including that of national and international migrant labor.
The family and regional economy is thus both diversied and exible. One
interesting dimension concerns the reconguring of roles within the families
of small and medium-scale farmers. Children now take charge of delivering
the fresh milk to the shared cooling tank; young men and women milk and
feed the cows, while the wives are required to wash the farms milk con-
tainers. In many cases, this results in the releasing of adult males from
dairying to work on other tasks on the farm or they seek farm or off-farm
work in neighboring areas and even as far aeld as the U.S.
Another element that has significantly changed the agrarian situation
concerns the way in which the newly founded farmers associations have
undermined the position of local commercial traders who previously acted
as intermediaries between the dairy producers and the older processing
companies. Now, of course, it is the farmers associations that are directly
responsible for negotiating with the dairy industries the terms and details of
the milk contracts. Much of this process relates to quality standardization,
which from the farmers point of view entails the necessity of gaining as
much autonomy as possible in the production process and achieving greater
control over the profits generated in the marketing chain. Many similar
processes pertain to other globalized commodities and to a wide range of
food products. The farmers of Jalisco have made certain advances in these
respects through collective actions spearheaded by their associations, but
have not gained as much ground as their counterparts in Aguascalientes.
The latter, it seems, have succeeded in strengthening their associations
through the formation of a single overarching organization which allows for
greater room for maneuver and negotiation with the dairy industry and state
agencies. In Michoacan, in contrast, local systems of power and patronage
have run counter to the goal of creating viable, profitable producer organ-
izations (McDonald, 2003). As in the Jalisco case, milk quality became a
critical issue in Michoacan that was ercely contested by the different ac-
tors: the small-scale dairy farmers, the larger producers, the milk processing
rms and the government technical experts.
The case of the Jalisco dairy industry underlines the degree of maneuver
possessed by small-scale producers even in the face of the standardization
imposed by international agreements and adopted by state agencies and
large-scale distributors. This occurs, in part, through contestation over the
differing definitions of quality used by local producers and consumers as
opposed to those promoted by technical experts employed by government
and large-scale distributors. Also important is the increasing political or-
ganization and clout possessed by small-scale producers in part advanced by
democratization and political decentralization.
The Resurgence of Ethnicities
Our third illustrative case is the apparently paradoxical one of the resur-
gence of collective indigenous identities in the face of the triumph of lib-
eralism. In the nineteenth century in Latin America, political and economic
liberalism was the explicit foe of corporate identities, particularly with re-
spect to collective property, whether of the church or indigenous commu-
nities (De la Pena, 1998). In the mid-twentieth century, the study of
indigenous communities was mainly the speciality of anthropologists con-
cerned to document the cultural practices and peculiarities of what, at the
time, seemed like a disappearing world. Rural sociologists tended, in con-
trast, to view indigenous populations, particularly those of the Andean
highlands, Mexico and Central America, as peasants, whose customs and
practices, including agriculture, could best be understood in terms of the
constraints and strategies of family-based farming. The predominant view of
Latin American governments tended to be that indigenous cultures were a
barrier to modernization. Indigenous languages were prohibited in schools
and in the work of government. In Peru, the government renamed the pre-
viously designated indigenous communities as peasant communities as an
explicit step in their progress to modernization. In the case of Mexico, the
indigenous past was revered, but the indigenous present was treated as a
living museum and placed under the tutelage of the National Indigenous
Institute. Thus any group that spoke an indigenous language and mani-
fested a distinctive culture was separated from the mass of the rural pop-
ulation, whether peasant or proletarian.
By the end of the twentieth century, indigenous social movements had
become some of the most active and consequential movements in Latin
America (Kearney, 1996; De la Pena, 1998; Langer & Munoz, 2003;
Van Cott, 2000; Varese, 1996; Hale, 2004). They have gained political power
in both Bolivia and Ecuador. They are even active and inuential in coun-
tries, such as Argentina and Chile, whose governing elites, for long, res-
olutely denied that their countries had indigenous populations.
The nature and impact of indigenous identities and movements reect the
two facets of neo-liberal reforms in the region, one economic and the other
political and social. The former brings increasing economic pressure on the
rural and urban poor, whereas the latter promotes rights, democracy and
what Hale (2004) calls neoliberal multiculturalism. Democratization in the
region has created spaces within which indigenous movements can develop
and make their demands heard. In this, they have been supported by na-
tional and international networks of NGOs that work on human rights
issues (Deere & Leon, 2000). The United Nations and most governments of
the developed world have also supported indigenous rights through spon-
soring conferences, making grants-in-aid to indigenous organizations and,
at times, through insisting that respect for indigenous rights and identities be
part of multilateral loan and grant agreements.
The demand-making capacity of indigenous groups and their self-
awareness as social actors have also increased with better communications,
including the use of the internet, increases in levels of education of indig-
enous people and the mobilizing impact of migration and urbanization. At
the same time, indigenous populations remain the poorest segment of the
population with pressing necessities, which have been aggravated by the
economics of neoliberalism, such as competition from cheap imported
foodstuffs. Strengthening indigenous culture as a means of eliminating the
marginality and powerlessness of indigenous people is a major platform for
indigenous social movements and the organizations that support them
(Iturralde & Krotz, 1996).
The aspect of indigenous identities and social movements that concerns us
in this paper is their rural character. Not all those who identify themselves as
indigenous live in rural areas. Indeed, in Chile, for example, a majority of
the Mapuche live in large cities, predominantly Santiago. However, in most
indigenous movements fundamental aspects of the construction of their
identities are embedded in the culture and practices of agricultural, pastoral
and forest activities. Also, some of the most important demands of indig-
enous movements are for agricultural and forest land, including the return
of ancestral land (Alwyn, 2002). They claim the right to live according to
their traditional laws and practices, as in the case of communal work ar-
rangements, collective tenure, household relations or community rituals
(De la Pena, 1998; Iturralde, 2001). These are most compatible with rural
not urban life. Likewise, the demands of indigenous movements for cultural
rights, such as multicultural education, are most easily implemented in rural
rather than urban settings. Their emphasis on territorial autonomy and a
return to a traditional rural life may, at times, be more political and ide-
ological than a practical plan, but the consequent emphasis on the impor-
tance of agriculture to indigenous people is an important component of the
new ruralities in Latin America.
In reviewing the resurgence of Black and indigenous collective movements
in Central America, Charles Hale (2004) argues that the imagined and oc-
cupied spaces that these movements create are essentially rural ones. As
Hale points out, there have been substantial achievements in extending and
recognizing Black and indigenous rights in Central America, partly as a
result of the strength of grass-roots organizations, but also because of ex-

ternal backing from multilateral agencies and foreign governments. Hale
shows how the multiculturalism that is promoted is mainly limited to the
cultural sphere and rarely reaches migrants or city dwellers. It creates in
Hales words contaminated spaces, where the hand of the state is already
present in the very efforts conceived to contest state oppression. The ma-
terial gains of the movements are usually over land rights, which in the past
had been sources of bitter conict between the landed elites of Central
America and the Black and indigenous populations. Conceding land rights
is now easier for elites because of the decline in the importance of agriculture
in the Central American economies and a shift of investments from tradi-
tional export crops to nancial, commercial and industrial activities. Land
grants have little economic cost for governments since they are not accom-
panied by the economic and infrastructural aid needed to make local pro-
duction commercially viable. Indeed, the greater control that Black and
indigenous movements have won over local municipal administrations can
be a pyrrhic victory in the context of the administrative decentralization
fostered by neoliberal reforms. It shifts responsibility for alleviating poverty
and providing services from national to the local level of government.
The resurgence of indigenous identities thus represents an unpredictable
face of the changing ruralities that accompany globalization. They have led
to a series of conicts with the state and private interests (Arce, 2003b;
Namuncura, 1999). Indigenous movements have often limited the expansion
of large-scale projects in ranching, plantations, lumber or hydroelectric
dams. The states conception of preserving ecology, as in the case of national
parks, can conict with what indigenous people see as their traditional rights
and farming practices.
Yet, the greater international visibility of indigenous movements gives
them more clout than non-indigenous small-scale farmers in resisting en-
croachment. They are also a potential force behind the revitalization of
small-scale, family-based farming and craft activities in many areas of Latin
America. This revitalization often includes using traditional knowledge and
farming practices alongside those of modern technology (Albo, 1996). In
Chile, for example, we interviewed a young Mapuche professional, who was
a computer technician in the regional capital of Temuco. He was active in
one of the Mapuche movements and had returned to his familys small farm
in the surrounding countryside. There, with the help of small loans from the
German overseas development agency (GTZ), he was practicing organic
farming, including the production of worms to make organic fertilizer. He,
with several other local small farmers, sent their organically produced wheat
directly to Santiago, where they could obtain twice the price of that offered
in the local Temuco market.
A further aspect of the resurgence of indigenous identities concerns the
importance of social capital and building trust relations within the new
ruralities. We noted earlier how top-down central state development
projects have been replaced in the contemporary period by a policy of de-
centralizing services and by placing more emphasis on community and other
non-state contributions to rural development projects. In the 1990s, social
investment funds in many Latin American countries provided relatively
small amounts of money for local community development that required
communities to bid competitively for the projects and to provide inputs into
them. Durstons (1999, 2004) studies in Guatemala and Chile have shown
that fundamental to the success of these projects is the degree of trust and
communal organization present at the local level what he labels, com-
munity social capital.
In his studies, it is indigenous communities with a strong tradition of
collaboration and a sense of identity that are often most able to make a
success of the project. Equally important to the success of such community
development projects, as Tendler (1997) shows in her studies in Ceara in
Brazil, is the quality and effectiveness of the relationships established at the
interfaces between the community and external actors, whether agencies of
government or NGOs. One of the most common obstacles to achieving this
arises from the mind-set of facilitators who often undervalue local knowl-
edge and view indigenous people and other rural groups as lacking in ap-
propriate skills (Spink, 2000; Arce, 2003a).
Urbanization and globalization have also economically revalued tradi-
tional practices and cultures, making them an important part of the new
ruralities. Tourism provides a clear example. Despite the importance of
enclave-type tourist development, such as the beach resorts of Mexico and
the Caribbean, there has been a growing emphasis on small-scale tourist
development. A main aim has been to spread more widely the economic
benets of the increasing numbers of national and international tourists in
the Latin American region. In those countries with strong indigenous cul-
tures, these are increasingly being capitalized in terms of tourism, as in the
case of the city of Cuzco, the Sacred Valley and the Inca trail in Peru. These
tourist experiences include visits to traditional villages and estas, the em-
ployment of local guides and the purchase of traditional crafts. While the
Cuzco area is a dramatic example of this new form of rural development, the
Peruvian government development agency, FONCODES, has been pro-
moting small tourism projects throughout the Andean area and into the
Peruvian Amazon. In Chile, the Mapuche have also been developing small-
scale tourist enterprises at the local level, which create for the visitor some-
thing of the experience of traditional Mapuche lifestyles.
CONCLUDING REMARKS
A central theme of this chapter has been the contemporary diversity of rural
areas in Latin America, based on differences in the ways that producers,
large and small, accommodate to the demands of the global economy. We
should be clear, however, that there are important differences between the
diversity that exists today in rural areas and that which existed in the past.
In the period of ISI, rural diversity was based on the uneven and partial
nature of the capitalist transformation of the rural economy with peasant
farming and traditional estates coexisting with modern commercial farming.
In that period, the processes of transformation had a distinctly national
character with marked differences between the agrarian structures of dif-
ferent countries that reected their degree of urbanization and industrial-
ization, and the actions of individual states.
Contemporary rural diversity in Latin America reects the direct impact
of global ows of trade, investment and information that are, in contrast
with the past, unmediated by national governments. Furthermore, these
global processes envelop rural economies whose capitalist transformation is,
in most cases, far from complete. Even small-scale family farmers in Latin
America are increasingly part of these processes, whether in terms of in-
creased international migration or through being directly affected by the
changing priorities for foodstuffs in the world market. Free trade brings
with it more competition for the small-scale, family-based rural producer
and demands more of that producer in terms of product standards. The
growing urban markets of Latin America threaten to further marginalize the
situation of the small-scale producer, creating demands for a wider range of
foodstuffs that are met through large-scale national and international dis-
tributors and retailers who deal directly with large-scale producers.
Bleak as this situation may appear for the survival of small-scale family
agriculture, we have chosen to emphasize the possibilities still open in rural
areas for people to adapt to the new situation and create spaces for their
own endeavors. Transnational companies and their national allies cannot
completely monopolize control over rural production and labor, especially
when agricultural yields are critically affected by changes in climatic and
ecological conditions. Also, there is no guaranteed market for a countrys
agricultural products in the face of changing consumer preferences and

competition at the world level over major export agricultural commodities.
With increased democracy and administrative decentralization, there are
now more political opportunities at the local level for small-scale farmers,
other small-scale entrepreneurs and farm workers to further their interests.
The possibility of alliances with non-farm social groups across the rural
urban divide increases as the countryside begins to serve the short-term and
long-term recreational and residential needs of city dwellers, both foreign
and national.
National and transnational migrant networks connect up many rural ar-
eas of Latin America with labor markets in the large cities of Latin America,
Europe and the United States. Remittances and information ow back to
rural families and communities, facilitating improvements in services, sup-
plementing incomes and, at times, becoming a basis for new entrepreneurial
ventures. Some of the poorer communities can only survive because of re-
mittances. These processes entail that rural spaces are neither discrete nor
self-contained. In this context, research needs to address the multiple in-
terfaces that now connect the different types of rural inhabitants with a wide
range of external actors. With this comes a clash of cultural perspectives and
practices, but also the possibility for negotiation and accommodation.
Contributing to the reconguration of the rural is the diminished role of the
state in rural development. The state has relinquished many of its tasks to
non-state bodies, such as NGOs, private companies and bilateral aid organ-
izations. In rural areas, many NGOs and private consultancies are now ac-
tively providing technical inputs into agriculture and facilitating the capacity
of better-endowed farmers to supply markets at comparative advantage. Ex-
isting policy rhetoric and politico-economic circumstances have opened up
new spaces for interest groups to contest these realities in some cases,
successfully resorting to the use of information technologies and global
networks to galvanize public opinion and to press their particular claims.
These conditions and dilemmas make it increasingly difcult to design
models for promoting specific development trajectories, for identifying al-
ternative scenarios, or for predicting the side effects of mainstream devel-
opment policies. Indeed these various side-effects and the breakdown of
many well-intentioned development efforts have become the central predic-
aments of international aid, as witnessed by the failure to foresee or effec-
tively deal with ecological disasters, civil strife, severe imbalances in local
economies, and the dislocations brought by the now huge transnational
migration process. The complicated mixture of intended, unintended, and
unanticipated outcomes of development policy compounds this situation.
The research challenge is considerable, but is best met by combining, as

Buttel (2001) argues, both political economy and actor-oriented perspec-
tives. We would add to Buttels review of late twentieth century agrarian
political economy by emphasizing the increasing importance of urbanization
in shaping and, at times, destroying rural space. The increasing importance
of off-farm work among rural inhabitants, as well as their family and work
links with urban areas at home and abroad, means that rural areas cannot
be analyzed as discrete economic and social spaces. The challenge for both
political economy and actororiented perspectives is, then, to avoid using a
xed spatial idea of the rural or the agrarian, while still retaining a sense
of the difference that the distinctive geographies of rural areas make to
outcomes.
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CONQUERING, COMPRADOR, OR
COMPETITIVE: THE NATIONAL
BOURGEOISIE IN THE
DEVELOPING WORLD
Andrew Schrank
ABSTRACT
This paper documents and accounts for the globalization of the so-called
national bourgeoisie in the late twentieth century. A substantial and
growing body of sociological literature holds that firms and investors from
the developing world have been denationalized, neutered, or destroyed by
their efforts to penetrate international markets and that cross-national
economic competition is therefore giving way to transnational class con-
flict over time. By way of contrast, I hold that not only peripheral cap-
italists but their elected and appointed representatives are compelled to
undertake large-scale, fixed investments, exploit their competitive advan-
tages, and challenge foreign firms and their respective representatives
on their own soil by the very logic of capitalist competition, and that the
aforementioned challenges will occur on political as well as economic
terrain.

ISSN: 1057-1922/doi:10.1016/S1057-1922(05)11004-X
91
92 ANDREW SCHRANK
INTRODUCTION
This paper reconsiders the role of the so-called national bourgeoisie in the
developing world. By national bourgeoisie, I mean native-born (or natu-
ralized) members of the capitalist class. I ask why otherwise discordant
liberal and radical development theories portray the national bourgeoisie as
the primum mobile of social and economic development (Evans, 1982,
pp. S210S211). What is distinctly national and, therefore, potentially
developmental about the national bourgeoisie? And I defend a supply-side
alternative to the traditional demand-side answer. While the demand-side
approach holds that indigenous rms and investors rely upon local product
markets and customers, and therefore tend to view the wage bill as a val-
uable source of aggregate demand as well as a worrisome variable cost
(Chibber, 2005, esp. pp. 227228). The supply-side view holds that indig-
enous rms and investors rely upon place-specific (Harvey, 1982) inputs,
investments, and assets including but not limited to political inuence,
and are therefore more developmentally nutritious (Helleiner, 1990) than
their foreign counterparts regardless of demand-side considerations.
Obviously, the two perspectives part company over the implications of the
national bourgeoisies growing dependence upon foreign customers and al-
lies in the twenty-rst century. While the demand-size view treats peripheral
capitals overseas ambitions and ventures as threats to peripheral Ford-
ism (Lipietz, 1984; see also Robinson, 2001, p. 168), and is therefore rather
pessimistic about the prospects for national development in the current era,
the supply-side approach holds that joint ventures, strategic alliances, and
developing country exports of both manufactured goods and skill-based
services reect not the abdication but the ascendance of the national
bourgeoisie (Harris, 1991), and is therefore agnostic if by no means
optimistic about the future.
Consider, for example, Indias storied software suppliers. While Peter
Evans bemoans their dependence upon low value added service exports, or
bodyshopping, in his by now classic account of information technology
(IT) policy in the newly industrializing countries (Evans, 1995), rms like
Wipro, Infosys, and Tata Consultancy Services are not only beginning to
compete with the big ve (Accenture, Cap Gemini Ernst & Young,
Deloitte, KPMG, and Pricewaterhouse Coopers) in the market for skill-based
software services but are also beginning to develop new products and pro-
cedures of their own and their move up in the global value chain is ap-
parently both a cause and a consequence of rising real wages in their countrys
IT sector (Mehta, 2004; Engardio & Einhorn, 2005; NASSCOM, no date).
Conquering, Comprador, or Competitive 93
Nor are Indias IT rms unique. A significant number of developing

country enterprises have overcome their inauspicious origins and surround-
ings by exploiting rather than succumbing to the process of globalizat-
ion. Brazils EMBRAER (Empresa Brasiliera Aeronautica) has transformed
itself from a publicly owned military aircraft manufacturer into the worlds
fourth largest private manufacturer of commercial aircraft by utilizing an
innovative combination of production and marketing tactics (Goldstein,
2002; Wheatley, 2004). Argentinas Techint has assumed a dominant po-
sition in the international market for seamless steel pipe by pursuing an
aggressive approach to mergers and acquisitions (Kock & Guillen, 2001;
Etchemendy, 2001; Salmon, 2002b). And Thailands CP Group (Charoen
Pokphand) has maintained revenues in excess of $6 billion per year as well
as the jobs of approximately 80,000 agribusiness, petrochemical, and allied
manufacturing workers in more than 20 different countries by pursuing an
equally aggressive approach to consolidation and divestment in the after-
math of the East Asian nancial crisis of 1997 and 1998 (Pananond, 2001,
pp. 4748).
The point is most assuredly not that developing country rms and inves-
tors are pari passu propelling their countries and compatriots upward in the
international division of labor. After all, the world economy is decidedly
dynamic and most if not necessarily all peripheral economies are running
faster to stay in place (Arrighi, 1990; Kaplinsky, 2001; Wade, 2003a). But
the globalization of peripheral capital is nonetheless worthy of reconsider-
ation for at least three reasons. First, it will almost inevitably inuence the
distribution of roles and places within the admittedly sticky international
division of labor and issues of mobility and immobility have traditionally
been central to sociological theory. Second, it has already transformed the
production proles of the more developed countries (MDCs) and the re-
sultant patterns of employment and income distribution are not only im-
portant in their own right but will also inuence the broader politics of the
globalization project for years to come (McMichael, 2004). And, third, it
is likely to affect the interests of and the opportunities available to
peripheral governments in the World Trade Organization (WTO) and sim-
ilar international institutions and to thereby inuence their long-term
evolution and perhaps even their modication or transformation.
In fact, the WTOs disciplines on trade, investment, services, and intel-
lectual property, are arguably designed to constrain the growth and dyna-
mism of peripheral capital. Ha-Joon Chang suggests that policymakers in
the developed north are using the WTO (and related agreements) to kick
away the ladder their own forebears used to scale the international
94 ANDREW SCHRANK
hierarchy of nations more than a century ago (Chang, 2002; see also Wade,
2003a, b), and the maturation of the peripheral bourgeoisie is arguably
being taken far more seriously by the northern policymakers and trade
negotiators who are defending the interests of northern capital from the
southern threat than by academic commentators who by assuming that the
material interests of northern and southern capital are compatible with each
other now and for the foreseeable future tend to deny that a threat exists
(Radice, 1999; Robinson & Harris, 2000; Robinson, 2001, 20012002, 2004;
Chimni, 2004; Desai, 2004; Panitch & Gindin, 2004).
I have divided my effort to reconsider the role and reputation of the
national bourgeoisie in the developing world into three distinct sections.
First, I trace contemporary sociologys apparent indifference to the growing
dynamism and belligerence of peripheral capital to the continued inuence
of the demand-side approach to the national bourgeoisie. By distinguishing
the national bourgeoisie from the comprador bourgeoisie at the point of sale
rather than the point of production (Vitalis, 1990, p. 305; Embong, 2000,
esp. p. 995; Chibber, 2005, p. 230), I argue, contemporary sociologists rule
out the possibility of a cosmopolitan-yet-combative capitalist class by as-
sumption and thereby wrongly portray the growing ambition and ability of
peripheral capital as the failure rather than the owering of the national
bourgeoisie. Second, I trace the growth of cosmopolitan-yet-combative
capitalists in three different sectors and countries forestry and forest
products in Chile, pharmaceuticals in India, and cement in Mexico to the
behavior of indigenous entrepreneurs and investors who hold place-specific
investments and assets and therefore have distinct national or territorial
interests whether they serve domestic or foreign markets (see Polanyi, 1944,
p. 152; as well as Harvey, 1982). Thus, the national bourgeoisies home
country bias and corresponding behavior derive not contra the existing
literature (Lipietz, 1984; Robinson, 1999, 2001, 2002; Chibber, 2005) from
an anachronistic or outdated Fordist pact with local workers and con-
sumers (Robinson, 2001, p. 168; see also Lipietz, 1984) but from immobile
investments in land, physical capital, and human relationships, which are no
less important in the contemporary era of globalization than they were in the
admittedly bygone era of nationalist development projects. And, nally
I discuss my conclusions and their implications for future research. Ulti-
mately, my goal is neither to overestimate the power of rms and states in the
periphery nor to underestimate the power of transnational corporations from
the core but to acknowledge and account for the persistence of conict
between core and periphery and to thereby underscore the inherently
contested if by no means anodyne nature of the globalization project.
ABDICATION OR ASCENDANCE? THE

GLOBALIZATION OF THE NATIONAL
BOURGEOISIE
The late twentieth century has frequently and accurately been characterized
as an era of globalization. By eliminating the many physical and insti-
tutional barriers which had previously served to slow the crossborder ow of
trade, investment, and to an admittedly lesser degree migration, the end of
the Cold War, the demise of Third World nationalism, and the rapid growth
and diffusion of information, communications, and transportation technol-
ogies conspired to create a single, integrated economy which is worldwide
or global in scope (Kurth, 2002, p. 6284; see also Stallings, 2003;
McMichael, 2004).
The data in Table 1 conrm the validity of the conventional wisdom by
underscoring the depth and pace of both the procedural and substantive
integration of the international economy in recent years. The data speak for
themselves: Flows of trade and investment are accelerating. Tariffs are fall-
ing. And regional and multilateral trade and market harmonization agree-
ments are growing in size as well as in number.
Both the procedural changes and their substantive impacts have been
particularly pronounced in the developing world. For example, the ratio of
trade to GDP has grown by a mere 15 percent in the developed countries
which already featured relatively open product markets at the beginning of
the decade and by almost 50 percent in developing countries. And the
Table 1. Indicators of Globalization.

Indicator 1990 2000
Trade in goods as a percentage of world product 32.4 40

Trade in goods as a percentage of developed country product 32 37.1
Trade in goods as a percentage of developing country product 34.6 51.6
Gross direct foreign investment as percentage of world product 2.7 8.8
Average developed country tariff (%) 7.9 4
Average developing country tariff (%) 23.2 11.3
Number of regional trade agreements 31 156
Number of World Trade Organization (WTO) members 0 148
Sources: World Bank (2002), Table 6.1; World Bank, unpublished data on average tariffs (dates
may not correspond to exact year); WTO (www.wto.org); and Global Policy Forum (http://
www.globalpolicy.org/globaliz/charts/rta.htm).
96 ANDREW SCHRANK
developing country share of inward foreign direct investment (FDI) has

grown as well, for transnational corporations have used the processes of
trade liberalization and deregulation to integrate their global production
and distribution networks to a heretofore unprecedented degree. In turn,
writes Diana Tussie, big rms from developing countries have seized the
moment and are also adopting an accelerated strategy of internationaliza-
tion. (Tussie, 1998, p. 187; see also Martin, 1997). Tussie invokes a number
of Latin American examples including Mexicos Cemex (Cementos
Mexicanos), Argentinas YPF (Yacimientos Petroliferos Fiscales), and
Chiles Luksic (1998, p. 187; see also Garrido & Peres, 1998; Financial
Times, 1998).1 They are by no means unique, however, for a host of Asian,
African, and Eastern European rms have rationalized their operations,
upgraded their human and physical capital, and moved into international
markets as well, and Leslie Sklair and Peter Robbins have therefore gone so
far as to argue that globalizing corporations are emerging all over the
world (Sklair & Robbins, 2002, p. 97).
The consequences are astounding. First, the worldwide distribution of
economic activity has shifted markedly over the course of the last decade. The
developing country share of world manufacturing value added has grown
from 16.7 to 24.1 percent (United Nations Industrial Development Organ-
ization (UNIDO), 2004, p. 184). The nominal value of developing country
manufactured exports has grown by a factor of three. And the developing
country share of world-manufactured exports has therefore grown from
16.6 to 26.8 percent (UNIDO, 2004, p. 186). While the exports in question are
frequently if by no means invariably marketed by foreign rms under their
own brand names, they are usually produced by local rms and managers in
their own factories, and they invariably and necessarily meet international
standards for price and quality (see Keesing & Lall, 1992, esp. pp. 178179).
Nor are the developing country gains limited to low technology sectors. On
the contrary, they have been higher in high-technology goods like pharma-
ceuticals, ofce machinery, and transportation and telecommunications
equipment than in middle and low-technology commodities like iron and
steel, petrochemicals, and textiles, clothing, and footwear (UNIDO, 2004,
p. 188; see also Amsden, 2003, p. 34; Lall, 2004, pp. 193195). And they
threaten to obscure unprecedented albeit all but unmeasurable growth in a
variety of skill-based service exports (see, e.g., Mehta, 2004; Engardio &
Einhorn, 2005).
Second, the higher income countries have acted to defend their markets
and interests from the developing country threat. The recently rescinded
United States steel tariffs are by far the best known but by no means the
only example of northern commercial hypocrisy (Watson, 2003; Lipietz,

2003). The European Union (EU) has imposed a surcharge on Brazilian iron
exports, challenged South Korean shipbuilders before the WTO, and re-
tained a decidedly protectionist approach to agriculture for well over a
decade (see, e.g., Gazeta Mercantil, 2001; Ward, 2003; Song, 2004). And the
more developed countries as a whole have pioneered the use of so-called
antidumping measures to safeguard their vulnerable domestic industries
from foreign competition (Finger, Ng, & Wangchuk, 2001).
And, nally, the developing countries have responded in kind. They have
not only used the WTO to resist northern protectionism (e.g., the steel, iron,
and shipbuilding cases) but have simultaneously taken antidumping meas-
ures of their own. In fact, the developing countries are by now the most
frequent users of antidumping initiatives (Finger et al., 2001, p. 6) and have
also managed to create a balance of power, according to some observers,
in the WTO (Christian Science Monitor, 2004; McLaughlin, 2004). There-
fore, the so-called northsouth conict is alive and well if perhaps being
waged on fresh terrain with new weapons in the twenty-rst century.
The depth of northsouth discord is not entirely obvious, however, for the
contemporary sociological literature tends to subordinate the reality of in-
ternational conict and competition to a myth of transnational consensus
and cooperation. A tour dhorizon of the recent literature would therefore
reveal extensive disquisitions on the allegedly transnational state epito-
mized by the multilateral institutions and very little evidence of northsouth
conict at the multilateral institutions (see, e.g., Robinson & Harris, 2000;
Robinson, 2001; Chimni, 2004; as well as McMichael, 2001 for an important
exception). Take for example, William Robinsons myriad contributions to
the globalization debate. While he all but derides hypothetical executives
who strategize at the annual Davos meeting of the World Economic
Forum over what proposals to bring to the WTO (Robinson, 2001, p. 182),
Robinson ignores the very possibility of irresolvable differences at the WTO
and thereby assumes what needs to be proven: that the national bourgeoisie
has indeed been absorbed into a transnational capitalist class.
In fact, the problem of bourgeois extrusion is particularly acute among
radical sociologists like Robinson. While Marx and Engels portrayed trade
in manufactures as the death knell of feudalism and the dawn of bourgeois
rule (see Marx, 1978 [1850]; Marx & Engels, 1888 [1848]), and therefore
welcomed the globalization of the industrial capitalist class in nineteenth
century Europe, Robinson treats globalization as the death knell not of the
precapitalist elite but of the national bourgeoisie itself, and therefore wor-
ries (see Robinson, 1998, 1999, 2001, 20012002, 2002). By pursuing foreign
98 ANDREW SCHRANK
markets and courting foreign allies, he argues, developing country rms

and investors abandon not only their reciprocal obligations to labor
(Robinson, 2002, p. 1063) but their national afliations (Robinson, 1998,
p. 581) more generally and thereby contribute to the demise of the diverse
alliances between subordinate classes and national ruling classes that char-
acterized the old national development processes and pave the way for the
new class relations of global capitalism (Robinson, 2002, p. 1064).2
Nor is Robinson alone. A substantial and growing body of literature
treats the transcendence of the domestic market as a threat to the role
and identity of the national bourgeoisie in the developing world. For ex-
ample, Alain Lipietz holds that protected manufacturers forged Fordist
pacts with their respective popular sectors in countries like Brazil, Mexico,
and South Korea in the late 1970s (Lipietz, 1984). Roger Burbach
worries that these elites now view their interests in an international con-
text and are increasingly opposed to national, protectionist policies
(Burbach, 1997, p. 16). And David Moore therefore bemoans the passing
of Keynesian compromises designed to bring states, their subsidised
national bourgeoisies, and civil societies to developmental heights (Moore,
2004, p. 93; see also Dietz, 1989; Radice, 1999; Sklair, 2000; Thomas, 2000;
Desai, 2004).
Indeed, Hugo Radice holds exporting, outward investment, technology
imports, or whatever responsible for the emergence of new comprador
bourgeoisies in the developing world (Radice, 1999, p. 18), and thereby
provokes an interesting question: Are entrepreneurs and investors who de-
fend their local markets more national (or nationalist) than entrepreneurs
and investors who hope to penetrate foreign ones? The answer is in part
denitional, for twentieth century Marxists not only described but defined
the national bourgeoisie as the segment of local capitalists who are
oriented to the domestic market, seek autonomy from metropolitan control,
and ally with the state around industrialization (Chibber, 2005, p. 230),
and their descendants therefore exclude the more cosmopolitan represent-
atives of the peripheral private sector from the terms compass.
The issue is not entirely semantic, however, for not only Marxist but
non-Marxist scholars frequently posit an objective relationship between
market orientation and capitalist behavior. While rms and investors
who pursue local markets treat wages as a desirable source of aggregate
demand as well as an undesirable variable cost, and are therefore amenable
to Fordist wage bargains, their more cosmopolitan counterparts treat
abor costs as nothing more than a source of competitive advantage, and
are therefore openly hostile to working class demands for improved wages
and working conditions. Therefore, the national bourgeoisies absorption
into the allegedly transnational capitalist class (TCC) is expected to con-
tribute to the downward leveling of wages, working conditions, and
ultimately living standards at home and abroad (Robinson, 2001, p. 170; see
also, e.g., Robinson, 2002, p. 1064; Sklair & Robbins, 2002, p. 98; Harris,
2005, p. 9).
The downward leveling thesis is at best controversial, however, and the
posited causal mechanism is almost certainly incorrect (see, e.g., Amsden,
2003). After all, the most serious threats to labor and the environment derive
not from TNCs and internationally competitive rms but from smaller
producers who target local markets (see, e.g., Shadlen, 2004, pp. 2325).
Therefore, Judith Tendler describes a kind of unspoken deal between pol-
iticians and their constituents myriad small rm owners, many in the
informal sector. If you vote for me, according to this exchange, I wont
collect taxes from you; I wont make you comply with other tax, environ-
mental, or labor regulations; and I will keep the police and inspectors from
harassing you (Tendler, 2002, p. 2). By way of contrast, larger, more
competitive rms not only have the wherewithal if not always the will-
ingness to pay taxes and comply with regulations but frequently view
adherence to internationally recognized labor and environmental standards
as the price to be paid for labor peace, public and investor relations, or
market access more generally.3
In fact, the best historical evidence suggests that the rise of mass pro-
duction does not require, but rather issues in, mass consumption that the
latter has depended upon the former, even though, in some important ways,
facilitating it (Brenner & Glick, 1991, p. 66; as well as Brenner, 1999). By
undertaking large-scale xed investments, and thereby raising their rates of
productivity to historically unprecedented levels, the largest and most dy-
namic northern rms not only rendered themselves vulnerable to working
class and at times government demands for improved wages and work-
ing conditions but simultaneously generated the resources necessary to ac-
cede to the demands in question and thereby facilitated the eventual growth
of mass consumption. The principal problem in developing countries is
therefore not an abundance but a paucity of domestically owned, large-
scale, internationally competitive rms and suppliers and the members of
the allegedly transnational capitalist class who are currently portrayed as
obstacles to the realization of the peripherys goals and aspirations are
therefore, in all likelihood, their last, best hope.
100 ANDREW SCHRANK
ACTING GLOBALLY, THINKING LOCALLY:

THE NATIONAL UNDERPINNINGS OF
INTERNATIONAL COMPETITION
Nobody denies that the largest and most dynamic peripheral enterprises are
forming strategic alliances, undertaking foreign direct investments, and en-
tering world markets. Observers part company, however, over the implica-
tions. A number of sociologists hold that the national bourgeoisie has been
denationalized, neutered, or absorbed into a transnational capitalist class
and that cross-national economic competition is therefore giving way to
transnational class conict over time (Sklair & Robbins, 2002; Robinson,
2002). Indeed, William Robinson has not only eulogized the national bour-
geoisie but anticipated the eventual dissolution of the historic afnities
between capital accumulation, states conceived of in the Weberian sense as
territorially based institutions, and social classes and groups (Robinson,
1998, p. 580; see also Burbach & Robinson, 1999). By way of contrast, I
hold that not only peripheral capitalists but their elected and appointed
representatives are compelled to undertake large-scale, xed investments,
exploit their competitive advantages, and challenge foreign rms and their
respective representatives by the very logic of capitalist competition (see,
e.g., Brenner & Glick, 1991, p. 106) and that the aforementioned challenges
will occur on political as well as economic terrain. In a way, writes Ellen
Meiksins Wood, the whole point of globalization is that competition is
not just or even mainly between individual rms but between whole
national economies. And as a consequence, the nation-state has acquired
new functions as an instrument of competition (Wood, 1998, p. 13; see also
Brenner, 1999). By exploring public and private sector responses to global-
ization in three different countries and sectors forestry and forest products
in Chile, pharmaceuticals in India, and cement in Mexico I hope to
validate Woods assertion, rehabilitate the national bourgeoisie, and bring
the globalization projects myriad internal contradictions to the forefront of
contemporary sociological analysis.
Forestry and Forest Products in Chile: From Denationalization to

Renationalization
The Chilean forestry and forest products industry is a behemoth. The

country plays host to more than 2 million hectares of radiata pine and
eucalyptus plantations, exports almost $3 billion worth of forest products

per year, and is expected to double the value of exports by the end of the
decade (McLean, 2003). Furthermore, the industry is dominated by local
rather than foreign rms. According to Simon Adamson, New Zealands
trade commissioner for South America, Chiles principal forestry concerns
are all large, local, and long term (Adamson quoted in McLean, 2003).
They are linked backward into wood planting, harvesting, and processing
technology; forward into the production of wood chips, pulp, paper, ply-
wood, berboard, and furniture; and laterally into transportation and
logistics. While the modern forestry and forest products industries have
always relied upon mass production (Cronon, 1991, Chapter 4), Chilean
rms like Compan a Manufacturera de Papeles y Cartones (CMPC) and
Celulosa Arauco are by all accounts particularly sophisticated, and raw logs
therefore constitute no more than 1 percent of the value of their exports
(McLean, 2003; see also Gwynne, 1996; Financial Times, 1997; Wood Based
Panels International, 1998; Timber and Wood Products, 1998ac on Arauco
and CMPC).
The Chilean forestry and forest products industry rests on a combination
of natural or geographic advantages, low labor costs, and human and or-
ganizational ingenuity. After all, Chiles climate ensures a short growing
cycle. The countrys narrow shape means that internal transport costs are
relatively low. The rural labor force is largely underemployed. And the
Chilean state has been actively sponsoring the industrys development for
almost a century (Clapp, 1995; Gwynne, 1996; Ramos, 1998; Timber and
Wood Products, 1998a; Kurtz, 2001).
Private foresters rst planted non-native pine and eucalyptus in Chile in
the late nineteenth century. They used pine in construction and paper
making and eucalyptus to fortify mine shafts. And they convincingly dem-
onstrated the untapped potential of the countrys forest products sector
(Clapp, 1995; Timber and Wood Products, 1998a).
By the early 1930s, therefore, the Chilean government had not only adopt-
ed a variety of targeted promotional measures including tariffs on imported
timber and tax holidays on private plantations but had also invested capital
drawn from the public pension fund in a series of publicly owned plantations
(see Clapp, 1995, pp. 278279). While import-substituting industrialization
engendered the overvaluation of the peso, the imposition of tariffs on key
inputs, and the taxation of raw log exports, and thereby circumscribed the
growth of exports in the middle of the twentieth century, it simultaneously
encouraged the development of new plantations and ancillary industries like
sawmills, pulp plants, and paper mills, and thereby fostered the overall
102 ANDREW SCHRANK
growth of the sector. Nevertheless, Salvador Allendes Popular Unity regime

made the forest industry the most socialized sector of the economy (Clapp,
1995, p. 280) in the early 1970s and his downfall therefore left an industry
almost entirely in state hands (Clapp, 1995, p. 280).
The military rulers who deposed Allende hoped to accelerate the indus-
trys development by privatizing public holdings, legalizing the export of
raw logs, and resuscitating the aforementioned tax holidays and subsidies
for new plantations. By 1980, therefore, the pace of reforestation had ac-
celerated; the percentage of reforestation performed by the state had fallen
from a 1973 high of 91 percent to almost zero; the value of wood and
cellulose exports had grown by a factor of four; and the industrys principal
patrons had for the most part deterred foreign takeovers (see Clapp, 1995,
p. 283; Kurtz, 2001, p. 5).
The forestry sectors more ambitious rms found themselves in need of
foreign partners in the mid-1980s, however, for the arrival of the debt crisis
had all but foreclosed traditional sources of nance and placed a premium
on joint ventures and FDI. Therefore, Arauco sold a 33 percent stake to
New Zealand rm Carter Holt Harvey (CHH) in 1987 and beneted from
the joint venture due to the capital inputs and international marketing out-
lets provided (Gwynne, 1996, pp. 349350). And CMPC formed a smaller
joint venture with a family owned North American rm named Simpson
Paper and achieved similar results (Gwynne, 1996, p. 352; see also Clapp,
1995, p. 288).
The joint ventures would not lead to the denationalization of the Chilean
forestry sector, however, for both CMPC and Arauco would buy out their
foreign partners in the late 1990s (see Timber and Wood Products, 1998b, c;
Wood Based Panels International, 1998; New Zealand Forest Industries,
2002). CMPCs purchase of Simpsons plantation and processing interests
followed the North American rms decision to divest from pulp and paper
and occurred on cordial terms (Mapes, 1997). However, Araucos purchase
of CHHs Chilean interests followed a power grab by the managers of In-
ternational Paper, who had assumed control of the New Zealand rm in
1995, and represented an unambiguous as well as an unexpected victory
for Chilean capital (see Gwynne, 1996; Financial Times, 1997; McNabb,
1997, 1999 for details). Araucos Chilean owners, the Angelini group, paid
CHH approximately 20 percent more than the book value for their assets
and have nonetheless continued to expand on the basis of their low cost
production methods (Torres, 1999). They recently opened a $1.2 billion pulp
mill and expect to open several more in the next few years (New Zealand
Forest Industries, 2002).
Nor is Arauco alone, for CMPC has expanded as well. They purchased
assets from Royal Dutch Shell as well as Simpson (Timber and Wood
Products, 1998b), and the two companies therefore control 60 percent of
their countrys commercial tree plantations, additional forest land in
Argentina, and a host of upstream and downstream capacity. Anacleto
Angelini, Araucos nonagenarian director, unabashedly describes his former
partners, CHH and International Paper, as rivals (Gwynne, 1996, p. 351),
and the forestry sectors in both New Zealand and North America angrily
decry the growing threat from Chile (McLean, 2003; Peart, 2004; Paul,
2004).
Nevertheless, Chilean foresters confront at least two serious threats of
their own: antidumping measures (and related trade barriers) in northern
markets (Gonzalez, 1997); and competition from new, lower cost producers
in the south (Clapp, 1995, p. 293). The largest Chilean rms have the ear of
their government (McLean, 2003), however, and together they have de-
signed a more or less successful two-track response. On the one hand, they
have used a series of bilateral and regional trade agreements as well as the
WTOs dispute settlement procedures to guarantee ongoing market access
(Fidler, 1997; Latin America Weekly Report, 2000; Baxter, 2001; Peart,
2004).4 On the other hand, they have increased productivity and moved into
higher value added lines and products (Timber and Wood Products, 1998b;
Wood Based Panels International, 1998; McLean, 2003).
In other words, the Chilean state has moved from the direct production
and protection of forest products akin to the roles of demiurge and midwife
described by Peter Evans (Evans, 1995, Chapter 4) to the indirect support
of forestry via big-business diplomacy (Amsden, 1989, p. 16) and the
provision of public goods. Chilean universities graduate more than 300
foresters every year and human resources are therefore abundant (McLean,
2003). The Fundacion Chile, a publicly sponsored technology incubator, is
undertaking research and development on information and biotechnology
for the forestry sector (Woods, 2002; UNFAO, 2003). And private rms are
collaborating with the foundation as well as undertaking R&D efforts of
their own (see Timber and Wood Products, 1998b; Untied Nations Food
and Agriculture Organization (UNFAO), 2003). The Chileans already de-
sign, develop, and distribute world-class forest management software (Press,
1993; Baeza-Yates et al., 1995; UNFAO, 2003), and at least one former
Monsanto ofcial believes that they will be the rst to market a transgenic
tree as well (Duncan quoted in Woods, 2002). They have the tightest
focus of anyone and, just as important, they have a government relationship
and infrastructure that will be most conducive to supporting a commercial
104 ANDREW SCHRANK
deployment of such a tree (Duncan quoted in Woods, 2002). A number of

experts therefore argue that Chilean public ofcials and their private inter-
locutors have transformed a more or less typical extractive industry into a
high technology, natural resource-based production cluster (Ramos,
1998) with low costs and high if admittedly uncertain potential.
Of course, the Chilean forestry industry is not idyllic. While timber is for
the most part cultivated rather than extracted and forest products are
industrially processed before they leave the country (Schurman, 2001,
p. 9), they rest on a historical foundation of not-so-primitive accumulation.
Native peoples have been dispossessed of their land and incorporated into a
low-wage, low-skill, and increasingly redundant plantation labor force
(Mulligan, 2001; Rohter, 2004). Native forests have been clear-cut by ra-
pacious loggers and timber companies (Clapp, 2001). And the native en-
vironment has been despoiled by industrial tree farms (Brown, 2000). The
repression, exploitation, and desecration have been carried out by native
rms, however, and therefore reect the ascendance rather than the abdi-
cation of the national bourgeoisie.
Pharmaceuticals in India: From Copycats to Innovators
The Indian pharmaceutical industry plays host to approximately 10,000

rms, employs a substantial number of the 12,000 chemistry PhDs who
graduate from Indian universities every year, and is the fth largest in the
world by volume (Kripalani, 2005; Pfeifer, 2004; Rai, 2005). According to
Saradindu Bhaduri and Amit Ray, the Indian governments active efforts to
promote indigenous technological development in the immediate aftermath
of independence not only allowed India to achieve self-reliance in drugs
but also set the stage for a significant export drive in the last two decades
(Bhaduri & Ray, 2004, p. 88; Grace, 2004, p. 17). Indian rms like
Dr Reddys, Cipla, Nicholas Piramal, and Ranbaxy are not yet household
names outside of the subcontinent but are nonetheless gaining market share
(Kripalani, 2005; Sridharan, 2005; Wilson, 2005). And Sankar Krishnan, a
consultant for McKinsey in Bombay, therefore expects the countrys
pharmaceutical exports to more than quadruple to $6.5 billion by 2010
(Tanzer, 2001).
Nevertheless, the industrys image and prospects have recently been
transformed by the Indian governments efforts to bring the countrys 1970
Patent Law into compliance with the WTOs agreement on trade-related
aspects of intellectual property rights (or TRIPS). While the process patents
recognized by the original legislation allowed different inventors to patent

the same product as long as it was created by a novel process, and there-
fore allowed copycat drug makers like Cipla and Ranbaxy to drive the
annual price of antiretroviral treatment down from $15,000 per patient a
decade ago to about $200 now (McNeil, 2005; Shadlen, 2005a), the prod-
uct patents recognized by the WTO-compliant amended legislation are likely
to disable the countrys copycats, breathe new life into western drug mo-
nopolies, and cripple the countrys campaigns against HIV/AIDS and other
diseases. Thus, Yusuf Hamied, the chairman of Cipla, declared that the
passage of the legislation would ensure a predictable, long term tragedy for
the country (Rai, 2005).
Neither Hamied nor his compatriots are ready to surrender, however, and
the larger, more dynamic Indian exporters are therefore responding to the
new legislation by forming joint ventures, pursuing R&D, and mining their
countrys enormous and growing human resource base for new competitive
advantages (Kripalani, 2005; Sridharan, 2005; Wilson, 2005). While the
largest Indian drug companies invest no more than 8 percent of their sales
revenue in R&D, their western rivals invest about 15 percent (Grace, 2004).
However, the Indian rms face a decidedly lower cost structure and there-
fore expect to come up with their own intellectual property (IP) in the
medium-term future. According to Cheri Grace, US bench scientists are
paid anywhere from ve to eight times more than their Indian counterparts.
US laboratory leaders are paid about three times more than their Indian
counterparts. US clinical trials cost about ten times more than their Indian
counterparts. And US manufacturing facilities cost approximately four
times more than their Indian counterparts (Grace, 2004, p. 18; see also
Tanzer, 2001; Wilson, 2005). Consequently, the cost of developing a new
drug from scratch in India is as low as $100 million or one-tenth the
cost in the US (Kripalani, 2005).
The leading Indian rms are therefore increasing their R&D expenditures
in an effort to develop blockbuster drugs of their own. For example,
Ranbaxy plans to elevate R&D spending to 10 percent of sales by 2007 and
thereby expects to quintuple revenues to $5 billion almost half from IP
by 2012 (Pfeiffer, 2004; Sahad, 2005). Nor is Ranbaxy alone. Half of the
leading Indian drug companies increased their R&D spending between 2002
and 2003 and the average level of R&D spending grew by almost one-third
in percentage terms (Grace, 2004, p. 23, 38). The increased R&D activity is
due in part to IP changes and the strategic reorientation they induce, in part
to the increasing technological capacity of the top Indian rms, and in part
to other domestic policies including not only the impending amendments
106 ANDREW SCHRANK
to the Patent Law but a series of tax holidays and pricing policies designed
to improve the rewards for R&D (Grace, 2004, p. 38).
The results are already apparent. While all Indian pharmaceutical rms
ignored the patenting process under the old IP regime, they led 855 patent
applications in anticipation of the onset of the new regime in the 20032004
scal year (Kripalani, 2005). Ranbaxy therefore expects to have four
investigational new drug applications in the R&D pipeline by 2007 (Sahad,
2005). Nicholas Piramal expects to have at least ve new-patented drugs
ready for clinical trials by 2008 (Kripalani, 2005). And Dr Reddys already
owns seven US patents and has eight more chemical compounds ready for
clinical trials (Pilling, 1999; Wilson, 2005).
What are the implications of their efforts? Ironically, Indias effort to
comply with the TRIPS agreement may well redound to the detriment of
northern pharmaceutical producers as well as southern pharmaceutical
consumers. If an Indian company makes a drug whose development costs
are under $50 million, compared with a billion-dollar-plus development cost
in the West, suggests Nicholas Piramals director of strategic alliances and
communications, we will be able to change the paradigm of drug discov-
ery (Swati Piramal quoted in Rai, 2005).
Nevertheless, the principal Indian rms would appear to need at least
5 more years to build a blockbuster drug from scratch (Sridharan, 2005)
and in the meantime they are pursuing a wide variety of complementary
profit-making activities. For example, Ranbaxy and Cipla are pursuing
new drug delivery research (Grace, 2004; Sahad, 2005; Sridharan, 2005).
Dr Reddys is outlicensing chemical compounds to western rms (Pilling,
1999). Nicholas Piramal is undertaking contract research as well as con-
tract manufacturing (Sridharan, 2005). And Indian rms as a whole are
vying for the unprecedented opportunity created by the near-simultaneous
expiration of patents on $60 billion worth of blockbuster drugs over the
course of the next 2 years and will almost certainly exploit their un-
paralleled cost advantage by continuing to serve the low-margin/high-volume
markets that have been their bread-and-butter for several decades
(Grace, 2004, p. 8).
Ultimately, however, Indias pharmaceutical rms have to go beyond
their traditional market segments and compete with the big boys head-
to-head if they are to survive. They have no choice in the matter. If companies
dont change, says Hamied, theyll get wiped out (Hamied quoted in
Sridharan, 2005). And Hamied is certainly correct. But he could be speaking
of any company in any industry in any country and, in so doing, explaining
why they will continue to defend their interests and investments in the face
of foreign competition. Indias pharmaceutical rms are undergoing a par-

ticular transformation but they are no more immune from the general laws
of capitalist competition than Chiles forestry rms or, as (we shall soon see)
Mexican cement makers, and they will therefore do their level best to turn
necessities like compliance with the WTOs admittedly draconian IP pro-
visions into virtues for the foreseeable future.
Cement in Mexico: Branding and Trading a Nontradable Bulk Commodity
Cementos Mexicanos has apparently done the impossible. While cement is

easy to produce, it is difcult to transport, all but interchangeable, and
therefore almost impossible to brand, Cemex has transformed cement
into an internationally traded, branded product and has thereby trans-
formed itself into the third largest and by all accounts the most profitable
player in the international industry (Piggott, 2001). In fact, Cemex cur-
rently employs 26,000 people, operates in more than 30 different countries
on ve different continents, and earns revenues of about $8 billion a year
(Latin America Weekly Report, 2003; Authers, 2004; Economist, 2004;
Moody, 2004).
Cemexs rise is particularly surprising against the backdrop of the North
American Free Trade Agreement. After all, the company entered the late
twentieth century as an inefcient, diversied, family-owned conglomerate
with interests in mines, chemicals, and hotels in addition to cement and
ready-mix concrete. By opening the countrys market to foreign competi-
tion, the Institutional Revolutionary Party (Partido Revolucionario Insti-
tucional) placed Mexicos industrial groups at risk. And many sold out or
surrendered to their foreign rivals (Arroyo, 2003, p. 21).
Nevertheless, Lorenzo Zambrano, the US-educated chairman of Cemex,
pursued a different strategy. First, he sold the companys ancillary oper-
ations and concentrated his efforts on the production and distribution of
cement and ready-mix concrete (Gascoigne, 1995; Moody, 2004). Second, he
used modern information and communications technology to guarantee
customers same-day delivery within a half an hour of schedule improving
on the industry average of 3 h and achieving an unprecedented 98 percent
rate of reliability in the process (LaFranchi, 1996; Walker, 2001; Barwise &
Meehan, 2004; Ruelas-Gossi & Sull, 2004). And, nally, he expanded into
world markets via direct investment as well as exports and thereby lowered
the cost of borrowing, raised market access, and mitigated the risk engen-
dered by the cyclical nature of cement demand.
108 ANDREW SCHRANK
Zambrano believes that Cemex is selling timeliness and quality rather

than cement per se (Zambrano quoted in Romero, 2000), and he and his
managers have therefore modeled their operation not on other manufac-
turing enterprises but on service providers like Federal Express and police
dispatch units. They own a eet of specialized ships and an army of trucks
(Hall, 1994). They communicate with their drivers through a proprietary
satellite network and the Global Positioning System. They take pride in
their ability to reach places that lack highly developed road systems, solid
telephone networks, and legions of well-educated workers where surviving
in the construction business is like keeping ones head above water in a
raging sea (Katel, 1997, p. 98; see also Dombey, 1996). And they command
a substantial price premium on every delivery (Latin America Weekly Re-
port, 2003; Authers, 2004; Moody, 2004). In fact, Cemex is not only the
most efcient cement corporation in the world (LaFranchi, 1996) but is also
an information technology powerhouse, and Zambrano has recently trans-
formed his IT division into a freestanding, multimillion dollar technology
consultancy, Neoris, that targets Fortune 500 companies from ofces in
Europe, the US, and Latin America (Piggott, 2001).
Nevertheless, Zambranos achievements are hard won. Cemex originally
paid an enormous premium for Mexicos subpar credit ratings and the cost
of borrowing actually threatened to impede the companys growth in the
late 1980s. By acquiring Spains two largest cement producers in 1992,
however, Zambrano began to generate a hard currency cash ow, reassure
his creditors, and gain access to credit on more desirable terms (Gascoigne,
1995; Colitt, 2000; Salmon, 2002a). In fact, the move into world markets
served as an alternative rather than a prelude to redomiciling the com-
pany (OBrien, 2003). Therefore, Zambrano continued to expand by pur-
chasing a number of different rms and plants in Central and South
America and Southeast Asia in the mid to late 1990s. He integrated every
newly acquired enterprise into Cemexs global logistics system; upgraded
manufacturing capacity; and thereby transformed his company into the
largest trader and fourth largest producer of cement in the world
(LaFranchi, 1996).
Zambrano had difculty penetrating the valuable US market, however,
for the Department of Commerce had imposed prohibitively high anti-
dumping duties on Mexican cement in 1990 and North American manu-
facturers had been campaigning against their repeal ever since (Johns, 1990;
Economist, 1995). The countrys second-largest producer, Southdown,
launched a massive public relations campaign against Mexican dumping
at the dawn of the NAFTA era and the Clinton Administration responded
by actually increasing the duties on Mexican cementin spite of GATT and

subsequently WTO ndings in favor of Mexicoin 1996 (Dunne, 1995;
Houston Chronicle, 1996, 1997; Beachy, 1996). While Zambrano answered
the North American challenge by serving the US market from his Spanish
and Venezuelan plants in the mid- to late 1990s (Gascoigne, 1995), he
ultimately acquired Southdown outright for $2.6 billion in 2000 and thereby
transformed Cemex into the largest producer in the US market, silenced his
loudest critic, and undermined the logical foundations of the Department of
Commerces case all at once. The director of Cemexs US operations there-
fore notes that his rm has more invested in the US market than any other
company and says its a little bit ridiculous for anybody to think that
Cemex would do anything to harm this market (Perez quoted in Moreno,
2005).
Nor is the US atypical. Cemex has invested enormous sums in a host of
countries including Egypt, Thailand, and most recently England, for Zambrano
acquired London-based RMC, the worlds largest ready-mix concrete pro-
ducer, for $4.1 billion in 2005. Cemex hopes to use RMCs unparalleled
production capacity to consolidate control over existing markets in Western
Europe and North America and to penetrate new markets in places like
Eastern Europe as well (see, e.g., Economist, 2004). By diversifying into
multiple markets in different world regions, according to Zambrano, Cemex
mitigates the risk imposed by the cyclical nature of the construction industry
(Dombey, 1996; Katel, 1997). Whereas the old Cemex diversied into mul-
tiple sectors in one country, the new Cemex diversies into multiple coun-
tries in one sector. The underlying logic is the same but the economic
consequences are radically different, for Cemex is now the worlds most
efcient producer and the company therefore generates an enormous vol-
ume of hard currency and investment capital every year. In fact, the com-
panys cash ow is devastatingly huge in the words of one market analyst.
Cemex is printing money (Uglow quoted in Fritsch, 2002).
A vastly disproportionate share of the companys profit, however, derives
from domestic operations (Barham, 2004). According to Elizabeth Malkin,
the Mexican market accounts for one-third of Cemexs sales but two-third
of the companys operating income (Malkin, 2004; Authers, 2004). While
US manufacturers attribute the differential to dumping (i.e., selling cement
below the cost of production) in the US market, it is in all likelihood a
reection of the differences between developed and developing country
market structures and Mexicos deliberately accid antitrust regime. On the
one hand, US construction rms are larger than their Mexican counterparts
and are therefore able to bid down the cost of cement (Fritsch, 2002; Silver,
110 ANDREW SCHRANK
2004). Consequently, Cemexs highest profit rates are neither in the US nor
in Mexico but in countries like Colombia and Venezuela (Authers, 2004).
On the other hand, the Mexican market is almost entirely closed to imports.
Cemex controls almost two-thirds of the domestic market. And Mexican
consumers who pay double what US consumers pay are therefore
paying an export subsidy on each and every ton of cement exported from
Mexico (Mastel, 1999, p. 9; see also Aguilar & De Jong, 2004).
The subsidy is not entirely accidental, however, for the Mexican govern-
ment has deliberately used antitrust and competition policy to defend native
industry in the face of foreign competition, and Cemex is particularly well
connected to the government. In fact, the companys directors have always
believed that you cant compete internationally if you dont have a dom-
inant position in domestic markets (Prieto quoted in Hall, 1994) and
Zambranos willingness to stay rooted in Monterrey rather than to redom-
icile himself in pursuit of better credit ratings is in all likelihood a product of
continued reliance upon political support not only in the realm of foreign
affairs but in antitrust policy as well. Zambrano accompanied Mexicos
President Vicente Fox on his trip to the White House in 2001 and continues
to seek (and receive) government support whenever necessary. The tools
have changed from tariffs, quotas, and export credits to antitrust (non)
enforcement and big business diplomacy but the ties between the public and
private sectors are no less important now than in the bygone era of explicit
industrial policy.
In fact, the cross-subsidization of exports with rents from the domestic
market is a time-honored development strategy. By conditioning access to
the lucrative domestic market on exports to more perilous foreign markets,
notes Alice Amsden (see Amsden, 1989, 2001), late developers in the Global
South have tried to steal a march on their northern rivals. While the late
developers traditional weapons of tariffs and subsidies have for the most
part been outlawed by the WTO and related agreements, Mexicos expe-
rience suggests that new weapons are available. And insofar as they render
the domestic market a means to an end i.e., international competition
rather than an end in itself, they strengthen rather than enervate the national
bourgeoisie.
DISCUSSION
The rms I have examined are national champions. They control the com-
manding heights of their respective national economies. They are owned and
operated by leading members of their respective capitalist classes. And they

are growing and prospering in spite of the withdrawal or transformation of
their respective government subsidies. They are not at all typical, however,
for most LDC rms are neither large enough nor sophisticated enough to
conquer world markets and are therefore condemned to compete for table
scraps in an increasingly cutthroat international economy. While radical
social scientists tend to portray large, competitive peripheral rms as the
problem, and at the very least imply that their more parochial neighbors
offer a solution, they overlook the manifold costs of parochialism
including labor repression, environmental degradation, and political
corruption and simultaneously underestimate the potential benets of
competition.
In fact, the contemporary sociological literature, in general, and propo-
nents of the TCC thesis, in particular, bemoan the immiserizing conse-
quences of accelerating international competition but, like their neo-Marxist
predecessors, ignore what historian Robert Brenner and economist Mark
Glick have referred to as the equally obvious counter-tendencies for com-
petition among accumulating, cost-cutting rms on the product and labor
markets to stimulate the growth of mass consumption, not only by bringing
about the increased employment of wage workers and growing wages, but
also by stimulating cost-cutting technical changes that themselves widen the
market by making for reduced prices (Brenner & Glick, 1991, p. 109). Are
the so-called counter-tendencies visible in the countries and cases I have
examined? The history of the Chilean forestry sector would appear to
counsel an afrmative answer. After all, the notoriously abusive industry
employs approximately 120,000 workers including about 50,000 temporary
or casual workers in silviculture and harvesting (ILO, 2000; Stewart, 2004).
While wages and working conditions are at best inadequate, they are almost
certainly improving and are particularly high in the downstream processing
activities dominated by Arauco and CMPC (Schurman, 2001; Morales,
2003). Nor are the Chileans alone. Indias more dynamic pharmaceutical
rms pay far less than their western counterparts but far more than their
more parochial neighbors. Cemexs Mexican workers make seven times the
legal minimum wage (LaFranchi, 1996). And the bivariate correlation be-
tween the ratio of trade to GDP a standard proxy for openness to com-
petition and an index of real per capita income produced by Bart van Ark
and Robert McGuckin for 19 developing countries including Chile, India,
and Mexico in 1996 is a staggering 0.81 (po0.001).
The point is most assuredly not that globalization leads always and eve-
rywhere to rising living standards and sustainable human development but
112 ANDREW SCHRANK
that the competitive dynamic underlying globalization that is, the com-
petitive dynamic imposed by capitalist property relations exposes periph-
eral workers and their communities to opportunity as well as risk. After all,
the competitive dynamic forces entrepreneurs and investors to undertake
large-scale investments in relatively immobile assets with long maturation
periods on pain of bankruptcy or buyout. To remain an independent com-
pany meant growing in Mexico, says Zambrano, plus being elsewhere
(Zambrano quoted in Gascoigne, 1995). And he is almost certainly correct.
The Chilean forestry rms paid billions of borrowed dollars to maintain
their independence from their North American partners. And Yusuf
Hamied anticipates similar incursions and hopes for parallel responses in
the Indian pharmaceutical sector. By undertaking costly investments
in relatively immobile assets, however, peripheral capitalists like Zambrano,
Angelini, and Hamied render their rms vulnerable to the demands of their
workers and consumers and duty-bound to pursue further productivity in-
creases.
The likely result is neither an inexorable race to the bottom (Robinson,
1999, p. 51; Sklair & Robbins, 2002, p. 98) nor a worldwide climb to the
top (Crotty, Epstein, & Kelly, 1998) but a political and economic conict
engendered by overcapacity and overproduction. By virtue of their lower
costs, writes Robert Brenner, rms from the later developing bloc are able
to take market share, even while maintaining at least the average rate of
profit, by reducing the price for their output (Brenner, 1999, p. 65). On
pain of bankruptcy, however, members of the original bloc counterattack by
purchasing new xed capital and accelerating the process of innovation
often with the implicit or explicit support of their states or nanciers
(Brenner, 1999, p. 65) and new market entrants from still later blocs follow
suit. Just as the mere oversupply of a line of production cannot be counted
on to force enough exit to restore its profitability, writes Brenner, that
same oversupply is insufcient to deter further entry that could bring down
its profit rate further (Brenner, 1999, p. 66).
On the contrary, the growing oversupply of manufactured goods and
services tends to foster political as well as economic conict between the
representatives of incumbent and challenger rms. Antidumping initiatives
and safeguards in the north, beggar-thy-neighbor macroeconomic policies in
the south, discord at the WTO, and the Bush administrations increasingly
protectionist thrust (Brenner, 2004, p. 97) would all seem to underscore the
continued and arguably growing importance of the nation-state and
nationality in the current era of globalization. Behind every transnational
corporation, writes Ellen Meiksins Wood, is a national base that depends
on its local state to sustain its viability and on other states to give it access to
other markets and other labor forces (Wood, 1998, p. 12).
What is the likely outcome of the struggle for market share? While the
MDCs and the US in particular are utilizing implicit and explicit sub-
sidies, coercive diplomacy, and draconian restrictions on intellectual prop-
erty rights to lock in the current international division of labor (see Chang,
2002; Shadlen, 2005b), their success is by no means a foregone conclusion.
After all, the newly industrializing countries feature an abundance of skilled
and unskilled labor, significant cost advantages, and the motivational power
of nationalist or at times even Third World ideologies. There is an effect
that is not quantiable for us, explains Zambrano, which is to be an
example, to be one of the rst companies from a developing country to have
an international presence (Zambrano quoted in OBrien, 2003). The own-
ers and managers of the principal Chilean forestry rms express similar
sentiments (McLean, 2003). And Hamied begins his public addresses by
immodestly asserting that he represents not only Cipla but the needs and
aspirations of the Third World (Hamied quoted in Specter, 2001).
While nationalist or Third World ideologies offer their adherents a con-
venient veil or public relations measure, they are not entirely disingenuous,
for peripheral capitalists are not obviously immune from the pull of na-
tionalism. Thus, Jamaican economist Norman Girvan perceptively notes
that the mere fact that peripheral capitalists are weak dependent and jun-
ior need not imply that they are objectively satised with their position
(Girvan, 1980, p. 451), and when they discover opportunities to challenge or
perhaps mitigate their dependency by exploiting their myriad advantages
they will do so sometimes to great effect. What if Indian rms design and
manufacture the next generation of blockbuster drugs? Or Chilean bio-
technology triumphs over timber scarcity? Or Mexican IT becomes the
industry standard for logistics and transportation? Who will capture the
returns? How will the MDCs react? And what will the world-system look
like afterward? The point is not that these outcomes are likely but that they
are possible and that they are all but completely and indefensibly ignored by
a sociology of development that posits but fails to prove the eclipse of
the nation-state and the demise of the national bourgeoisie.
NOTES
1. The YPF case merits additional commentary in light of the Argentinean oil
companys recent purchase by Spains Repsol. Sebastian Etchemendy notes that
114 ANDREW SCHRANK
YPFs share of Argentinean oil production had actually diminished and that Perez
Companc, a national company and a private contractor of YPF since the Ongan a
dictatorship, had almost doubled its market share and displaced the U.S. company
Amoco as the largest private producer of petroleum in Argentina after YPF in the
1990s (Etchemendy, 2001, p. 13). Therefore, Etchemendy concludes that in times of
economic internationalization, it was, paradoxically, the national bourgeoisie tra-
ditionally protected by the state that obtained the best market positions in the sub-
sector, displacing international capital. While Repsols recent purchase of YPF
and Petrobrass acquisition of a controlling interesting in Perez Companc call
the viability of Ethcemendys conclusion into question, and cast doubt upon the
Argentinean bourgeoisies ability to withstand their countrys recent nancial crisis,
they arguably underscore rather than undercut the growing power of the peripheral
bourgeoisie more generally since the respective domiciles of both Repsol and
Petrobras (Brazil) lie outside of the organic core (Arrighi, 1990) of the world
economy.
2. Robinsons collaborators are arguably more perceptive but no less skeptical of
the peripheral bourgeoisie. While Jerry Harris welcomes the arrival of assertive
public ofcials and aggressive private sectors in newly industrializing countries like
Brazil, China, India, and South Africa, and acknowledges their self-conscious effort
to readjust globalization by developing a power bloc of developing nations
(Harris, 2005, p. 21), he portrays their apparent commitment to trickle-down
economics as a necessary and all but insurmountable obstacle to more thorough-
going structural transformation, and therefore calls their antisystemic bona fides into
question (Harris, 2005, pp. 2425; cf. Robinson & Harris, 2000).
3. Tendler briefly examines ve cases of upgrading in small rm clusters; in
every case, the upgrading process occurred as a response to foreign or international
pressures. Her basic ndings are consistent with the results of my own research on
labor law enforcement in the Dominican Republic (Schrank, 2005).
4. For example, Chile has been a complainant in the recent controversy over the
Byrd Amendment at the WTO. The U.S. congress passed the legislation in 2000 and
thereby agreed to transfer antidumping duties to the affected industries including
lumber. Nevertheless, the WTO has ruled that the legislation constitutes an illegal
subsidy and has therefore granted Chile and a number of other complainants the
right to impose retaliatory sanctions on the U.S. (see Vrana, 2004). I would like to
thank Mar a del Carmen Dom nguez of the Chilean mission to the WTO for insight
into Chiles role in the Byrd conict.
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WHAT IS FOOD AND FARMING
FOR? THE (RE)EMERGENCE OF
HEALTH AS A KEY
POLICY DRIVER$
Tim Lang
ABSTRACT
The restructuring of food systems over recent decades has rightly received
social scientific analysis. This paper argues that the public health impli-
cations of the cultural and production changes have received less atten-
tion. Yet, new health-oriented analyses offer a rich understanding of how
societies have changed in what they eat, why and how food is produced,
whose health is affected and by what diseases. Health should be at the
heart of social scientific thinking about food and farming. The case for a
more integrated approach to food and farming, linking health, environ-
ment and society is strong.
$
This chapter is based on the talk prepared for Trondheim 2004. It draws on papers presented
to the Fairtrade Foundation in London, March 2004; the European Public Health Association
10th Congress, Oslo, October 2004; and the City Insights lecture in London, May 26, 2004.

ISSN: 1057-1922/doi:10.1016/S1057-1922(05)11005-1
123
124 TIM LANG
INTRODUCTION: HEALTH
THE FORGOTTEN DIMENSION?
This paper focuses on one policy strand public health in the web of
emerging thinking about the future of food and farming. It argues that
health ought to be more central in analysis of the re-framing of food policy
that is occurring worldwide, not just in developed countries. It is widely
understood that, worldwide, both farming and the use of the land are being
restructured. A period of great change is underway in which the nature of
production and distribution is being altered in a fundamental and rapid
fashion. Farming is poised to intensify still further; foods very nature is
being moulded to suit processing; the logistics revolution enabled by com-
puters and satellites is transforming distribution; diets are no longer bound
by seasonality; off-farm processes as diverse as marketing and packaging
frame how food looks. Dynamics between and within sectors are being
changed dramatically by new technologies and management.
Over the last two decades, rural sociologists and geographers have been
particularly active in mapping how these changes are manifest on the land
and up the supply chain, and in exploring what drives those changes. They
have pointed to the depth and extent of the restructuring process underway.
This social science contribution to analysing modern food systems has been
rich and complex but, at the same time, comparatively silent on the role of
health in farm and food policy. Social scientists who address the interplay of
food and health are rare if anything, they refer to nutrition at best
sketchily or they focus on developing countries cultural change. With good
reason, the existence of hunger amidst plenty continues to receive attention.
But the case for a rethink about health-food dynamics argued here requires
more than a focus on hunger, continuing policy sore though that is the
nightmare now stalking the worlds health stems from the coincidence of
under-, mal- and over-consumption in both developed and developing
worlds, albeit in different patterns. Health and ill-health are heavily asso-
ciated with food in a new, complex and important way. The change in
modes of cooking, for instance, (and whether there is cooking at all) in
developed societies has both a cultural and health impact that surely war-
rants attention. The unleashing of vast advertising budgets to undermine
staple diets is another feature binding north and south.
This paper argues therefore that a new, interdisciplinary and holistic so-
cial scientific analysis of the relationship between food, farming and health
is overdue. Further, it proposes that existing social scientific appreciation of
What is Food and Farming for? 125
environmental, consumer and primary producer complexities means the

social sciences are well placed to help frame the emerging analysis known as
ecological public health. This is one of the two paradigms which, has been
argued (Lang & Heasman, 2004; Lang, Barling, & Caraher, 2001; Barling,
Lang, & Caraher, 2002), and are emerging to replace the old productionist
food policy framework that focused on raising production and productivity
in the second half of the 20th century.
FOOD POLICY IN FLUX
Policy goals such as health, efciency and environment are fraught with
debate. They are reminders that food policies, institutions and debates are
contested space within a contextual holy triangle of State, Food Supply
and Civil Society (see Fig. 1). This triangle encapsulates an enduring feature
of food, its contested nature. Throughout history, in all societies, as food is
fought over consider issues such as land ownership, affordability, quality,
trade and health the three power blocs of state, supply chain and society
emerge as foci for interest battles. But this simple triangle is itself a problem.
The three power groupings, we know, are fragmented, internally divided,
subject themselves to ebbs and ows of power, capital, inuence and history.
Despite its simplication, the Triangle model (State Supply Chain
Civil Society), like most models, has value in pointing to the main tensions
over the shape and direction of food. Each corner of the triangle is itself
fractured. The supply chain, for example, is internally dynamic; farmers,
manufacturers, retailers, logistics, catering/foodservice all vie for consumer
spending. Food service in many countries is poised to rival retailer power for
direct access to the consumers money. Some farmers have responded by
returning to markets and selling direct to consumers: the farmers markets
and organic movements, notably.
State
Food Supply Chain Civil Society
Fig 1. Food as Contested Space between State, Food Supply Chain and
Civil Society.
126 TIM LANG
In all food sectors, there are unprecedented levels of concentration. Giant

food corporations straddle borders and have immense purchasing power,
which enables them to buy already large national champions. Wal-Mart
(USA), Tesco (UK), Carrefour (Fr) and Ahold (NL) are striding the globe,
emulating a globalisation pioneered by food processors for decades even a
century ago. These retail giants set their own standards, separately and in
alliances (such as EUREP (www.eurep.org)), sometimes in competition with
the State and have long lines of accountability, auditing and controls
(Marsden, Flynn, & Harrison, 2000b). They walk a ne line between con-
trolling and servicing consumers (Lang, 2003). Prior to EU enlargement,
a study by CAP Gemini showed how in the 15 member states, there were
3.2 million farmers feeding 250 million consumers, via 170,000 outlets, from
88,600 processors and manufacturers, but this supply and demand was
funnelled through only 600 supermarket chains with 110 key buying desks
(Grievink, 2003). The fewer number of buying desks reects the purchasing
alliances that have grown between retail chains, as they share specications.
This pattern of concentration is repeated, with differences, in some com-
modity regimes; for instance, just three companies have over 50 per cent of
the Brazilian Soya feed trade to Europe too (Vorley, 2004).
To aggregate the complexities of the modern State as Fig. 1 does is also
an over-simplication. The State is now multi-level local, sub-national,
national, regional and global. At all levels, there are para-state organisa-
tions, through which national governments relate and contest food and farm
policy. It is hard to understand the consumer interest without appreciating
how arcane issues such as food standards now get fought over lengthily
and sometimes bitterly at the various levels. Notions of policy competence
and subsidiarity are fought over between the levels. Although the local is
important, for service delivery, most decision-making now tends to be made
in complex negotiations between national, regional and global levels of
governance.
The third corner of the triangle, civil society, is the consuming public,
with all the diversity that entails class, gender, age, society, etc. In ad-
dition, vast numbers of civil society organizations voice and vie for lead-
ership of the consumer interest. Within this non-governmental organization
(NGO) sector, distinctions must be made between Business Interest NGOs
(BINGOs), Government-ordained NGOs (GONGOs) and Public Interest
NGOs (PINGOs). Civil society is further fractured by class, demographics,
culture, rich world/poor world consumer interests, and so on.
Some food and farm sector analysts argue that the role of the state is or
ought to be declining. Economists pronounce as to state distortions, notably
through unwarranted subsidies. Some realism is due. Even the neo-liberal

domination of policy in the last quarter of the 20th century never quite
managed to take the state out of food and farm policy discourse. Even
within market theory, whose purest ideologues propose that food is or ought
to be subject to market forces, and whose policy central tenet is to restrict
the role of the state or remove it altogether, the relationship between the
supply chain and civil society/consumers is in fact mediated or framed by
the state. Even the triumph of the neo-cons in early 21st century USA politics
actually used the state to shape the state, not just markets. This heightened
ideology in and about food should not surprise us; agriculture and food have
always invited state, not just corporate or civilian contestation.
In a 1981 treatise on food policy the only one with the term in its title
the Agriculture working party of the Organisation for Economic Co-operation
& Development (OECD) dened food policy as the actions of the state:
those policies affecting food its supply and impact which reect the
dominant priorities and objectives of governmentsy (Organisation for
Economic Co-operation and Development, 1981). Food policies, argued the
OECD, govern the food economy. They dened them as the set of activities
and relationships that interact to determine what, how much, by what
method and for whom food is produced. Creating public policy on food is
a dynamic [process] in which there is continual interaction and reaction.
Most state attention was assumed to be on just two areas: nutrition
and agriculture, a framework shared with the World Bank at that time too.
With regard to agriculture, the policy mission was clear and had been
widely agreed by the mid century. A leading World Bank text of the 1980s,
too, argued that food policys goals were to deliver more food. Food policy
encompasses the collective efforts of governments to inuence the decision-
making environment of food producers, food consumers and food market-
ing agents in order to further social objectives. These objectives nearly
always include improved nutrition for inadequately nourished citizens and
more rapid growth in domestic food production (Timmer, Falcon, &
Pearson, 1983, p. 9). Such policies were overwhelmingly pitched in econ-
omistic terms, with central attention on farm prices, and, therefore, market
access. Efciency in agricultural systems would improve farm incomes and
in turn deliver gains in nutritional status and food security, via low prices
(Timmer et al., 1983, p. 14).
For nutrition, the impact of this policy equation was clear: more out-
put would yield more food, reduce insecurity and restrict the vagaries of
seasons, terrain and distribution. Nutrition, for the OECD, like all thinking
within the dominant productionist paradigm from the 1940s, centred on
128 TIM LANG
managing the food chain to deliver more food, more efciently, more ef-
fectively, less wastefully and using steered market forces (Lang & Heasman,
2004). Nutritional health was central to policy mainly because the world had
come to realise the extent and structural nature of hunger and that human
action was a factor in whether it was tackled. This was a lesson learned by
the 1930s, not least by the League of Nations (League of Nations, 1936).
The Leagues quaintly named Mixed Committee on the Problem of Nutri-
tion acknowledged that countries nutrition status varied by circumstance;
some affected by macro-economics and others by the legacy of poor
understanding of how nutrition could improve physical performance.
Even the well-to-do could be improved by better nutrition, the Committee
concluded.
The political implications of the arrival of this modern science-based un-
derstanding of nutrition were considerable. The 19th century liberal and
even mercantilist schools, which judged food as best left to market forces
the triumph of free traders over protectionists nally recognised that such
economic policy packages could not adequately address the problem of
hunger. This was not just a problem for what now we term the developing
world then shaped by colonial reach but for the rich heartlands also.
Entering World War II, for example, Britain, then a world power that only
produced 30 per cent of its food and was instead fed by its empire, was
accumulating evidence of hunger. The British Medical Association, the
doctors professional body and hardly radical, hosted a conference in 1939
to review food and health. Lord Horder, the President of the BMA, com-
mented in the nal report in unashamed radical if patrician terms:
A short time ago I was so bold even so impertinent as to express the wish that the
Ministers of Health, of Agriculture and of Transport, with the Governor of the Bank of
England, might be locked in a room together and kept there until they had solved the
problem of food production and of food distribution in this country. This was only
another way of saying that I believed the problems of malnutrition, of food, and of
poverty in the midst of plenty that is surely not an overstatement could never be
solved if dealt with compartmentally, but that they could be solved if taken together and
dealt with by a long-term policy. (British Medical Association, 1939, p. 5).
The case for policy intervention and co-ordination with health had moved
centre stage. Solutions being mooted included:
a focus on children with direct provision of welfare services such as for
school meals and milk;
nancial and policy support for women such as through direct payments
or family allowances;
a concerted focus on food supply;

controls on trade to make it meet need; and
a strategy to rebuild national agriculture.
In many developed countries, such debates and policy shifts occurred,

within national terms and conditions, with a widely shared experience of
agricultural depression, hunger, social dislocation and trade uncertainty.
World War II consolidated this experience. Using Britain again, we can note
how a conservative doctor such as Sir John Boyd Orr could capture main-
stream thinking. He had conducted an oft-cited study of food poverty and
ill-health in Scotland in 1936 and had earlier created the Rowett Research
Institute, a large agricultural research body in Aberdeen, to improve ag-
ricultural output (Boyd Orr, 1936). In 1943, he was arguing on behalf of the
state and civil society that war had:
forced us to adopt a food policy based on the nutritional needs of the people. Soldiers
and munitions workers have to be maintained in the highest possible state of ghting and
working efciency, and for the maintenance of the morale of the nation, the people has
to be as well fed as possible. [y] Then the available food was distributed in accordance
with physiological needs, special measures being taken to ensure that the higher needs of
mothers and children and of heavy workers would be met. (Boyd Orr, 1943)
He observed with admiration how the USA was setting targets to increase
output: for fruit and vegetables to rise by 75 per cent, milk rise by 39 per
cent, eggs by 23 per cent, and so on. This was responsible, health-informed
food governance. At the wars end, he became Director General of the newly
created Food and Agriculture Organisation (Boyd Orr, 1966). These argu-
ments had captured not just national but international policy space. The
productionist paradigm or policy framework had replaced the old order.
This new paradigm may be represented as a social equation:
Science + Capital + State Support (Finance + Policy) Increased production, which
if distributed appropriately Health + Well-being
Productionism (see Table 1) promoted and institutionalised:

a drive for efciency, with new indicators such as higher yields, and ra-
tional use of labour;
the triumph of scientific farming;
the appliance of science and technology to reduce waste and increase
productivity;
a good return on capital;
the demise of so-called dog and stick (i.e. old-fashioned) farming;
concentration of herds and land-holdings;
130 TIM LANG
Table 1. The Upside of the Productionist Paradigm.

Category of Success Evidence on Examples
Technical advance Increased yields Hybrid cereals

Efciency Mechanisation Labour replacement
Affordability Price drops Drop in pig/poultry prices
Availability Range of foods Hypermarkets stock 230 k items
Beating hunger Drop in percentage of FAO estimates of decline in world
population experiencing food insecurity 19602000
hunger
a decline of labour directly employed on the land;

an expansion of infrastructural services such as fertilisers and pesticides to
increase crop yields;
state support through extension schemes;
intensication the systematic attempt to achieve more throughput from
capital, land, equipment, labour, animals, crops; and
a reduction of the price of food for mainly urban consumers.
This last issue was particularly important. The productionist paradigm

had rightly noted that the health problems of pre-World War II populations
were a combination of lack of availability, affordability and price. A policy
package that reduced prices by improved efciencies, would benet public
health it followed. Thus, the close relationship forged in the war between the
food industry, particularly food manufacturers, and the government was
enshrined in subsidy-welfare packages in the developed world and a package
of extension, aid and technology transfer in the developing world. Ministries
and departments of agriculture became famously associated with agency
capture. The distinction was blurred between national and agricultural in-
terests (Self & Storing, 1971).
It should be acknowledged that the productionist paradigm was in its own
terms very effective: introducing remarkable engineering, chemical and bi-
ological technologies, improving efciency, driving down prices, lling su-
permarket shelves in the West, increasing output in the South, reducing the
percentage of humanity suffering hunger (see Table 1). But this has come at
a cost to the environment, public health, consumer condence, animal wel-
fare, terms of trade and social justice (see Table 2). Current policy now has
to grapple with these externalities (Pretty, 2002).
Today, the paradigm is under strain because it cannot satisfactorily
address the complexities of modern supply. Policy-makers have to grapple
with a far wider range of issues than merely under-nutrition or poor
Table 2. The Downside of the Productionist Paradigm.

Category of Concern Evidence on Examples
Environment Residues in food, soil structure Residues of pesticides and

and water use nitrates; biodiversity loss.
Public health Diet-related degenerative Spread of coronary heart
diseases disease, diabetes, strokes,
some cancers, obesity
worldwide
Food safety Contaminants and E. coli, Salmonella and BSE
microbiological
Consumer rights Information Weak and complex labelling
Animal welfare Factory farming Prophylactic antibiotic use
Social justice Continuation of food poverty Growth in absolute numbers of
food insecure 19602000
Table 3. Key Policy Goals and Problems under the Old Food
Policy Regime.
Policy Goal toy And Address the Problem ofy
Deliver more food Under-production

Ensure more food gets to consumers Poor distribution
Raise efciency Reduce waste, increase
Increase productivity Reduce costs to improve affordability
Tackle under-consumption Food poverty
Improve skills Poor farmer knowledge
agricultural supply. Productionism cannot cope with pressing demands formed

by evidence on environmental damage or over-consumption. As Maxwell,
Slater and co-workers have argued, there is now a transition from an old to a
new food policy agenda (Maxwell & Slater, 2004). This policy transition has
been driven by structural change in all corners of the Triangle presented
in Fig. 1. Table 3 gives some food/nutrition goals and problems the old
Productionist paradigm sought to address. Table 4 gives, by contrast, new
food policy challenges for the food supply chain in the early 21st century.
The old policy framework assumed that farmings contribution to health
was by securing affordable food supply, yet by the 1970s epidemiology was
suggesting how, even in developing countries, diet-related ill-health was
manifest in a new triple burden: over-, mal- and under-consumption. The
deepening food and environment crisis resource use, access to land,
132 TIM LANG
Table 4. Key Policy Goals and Problems under the New

Food Policy Regime.
Policy Goal toy And Address the Problem ofy
Produce more equitable consumption Inequalities and malnourishment

Reduce over-consumption Non-communicable diseases: Heart disease,
cancers, obesity and diabetes
Make supply chains sustainable and long- Environmental damage and cost externalities
term food secure
Build a more appropriate food culture Warped information and food cultures weakened
by marketing
Ensure high quality Consumer condence and vulnerability of long
supply chains
Inject real competitiveness to markets Oligopolies and concentration; domination by
retailers
supply, biodiversity, climate, water, etc. underlines the urgent need for
scrutinising ecological public health. Population health goals and environ-
mental health can and should go hand in hand (McMichael, 2001). Good
human health requires ecological viability and, vice versa, what is good for
ecology diversity, low impact farming, sustainability can be good for
health. Yet this is not necessarily being delivered.
In this scenario, health as a policy goal underpins and transforms the
food supply chains drivers and dynamics, providing an accurate, evidence-
led policy framework for food and farming, which it lacks currently. How
else could the worlds food supply be so centrally implicated in the current
main causes of global premature death hunger and malnutrition on the
one hand and over- and mal-consumption leading to the degenerative dis-
eases on the other? For those who fear or resist the injection of a new health
perspective into food supply policy, it should be restated that the 20th cen-
tury production-led revolution in the supply chain altering what is pro-
duced and how was also based on a health case. This case, in place by the
late 1930s but adopted in the 1940s, had proposed that human ill-health was
heavily framed by under-consumption and social inequalities, neither of
which were natural or necessary states. Production could be raised by sci-
ence and capital, heralding a world of plenty in place of hunger and in-
security. Industrialisation and intensication were solutions to a real, not
imagined, package of policy problems: mal-distribution, waste, under-
supply, hunger, and ill-health.
Today, although this productionist approach to health has been hugely
successful in reducing the proportion of food insecurity, the worlds health
prole is now more complex. The co-existence of under-, over- and mal-
consumption adds policy complexity, which partly explains why systems of
governance at national, regional and global levels are not coping with the
need to produce a new integrated policy framework; they are locked into
segmented modes of policy analysis. A key illustration of this multi-
dimensional challenge is the impact of what is called the nutrition transition,
a change in what foods are consumed, tastes, the range of food, not just how
food is produced. The shift in nutrient mix received has implications, which
ought to be more central to social scientific formulations of rurality, food
and farming. Indeed, the new public health challenge posed by changed
consumer preferences and regionalisation and globalisation of supply chains
requires a return to some basic policy questions. Where does health come
from? Land or supermarket? Or put it differently, what good is the land for
health?
WHAT IS THE LAND FOR?
Land is natural capital, a resource owned and fought over, a foundation not
just for wealth, but also (ill) health. Land is a key to employment, envi-
ronmental goods, welfare, civic space, identity, amenity for relaxation,
tourism and sports, and of course food. With the decline in political power
of farmers, the significance of land has been diminished, but oil insecurity or
climate changes are likely to herald its return to centre stage in policy. The
UK, my own country, illustrates contemporary policys ambivalent rela-
tionship with the land. As the rst industrial nation, it was the rst to shed
its people en masse from the land, the rst to require mass and routinised
food supply chains to the majority of the population in towns and cities.
Britain, as the worlds pre-eminent imperial power then took that human
experiment to lengths still not emulated by other comparable nations. After
a bitter policy ght between the old landed aristocracy and the edgling
new industrial and urban professional classes, in which the latter tri-
umphed, the UK parliament repealed the tariff system that supported home-
grown production.
By passing this Repeal of the Corn Laws Act in 1846, the UK began a de
facto experiment in what the effects might be of reducing any food-
producing demands on its rural landmass. The implications of this policy
experiment have been much analysed and debated, mostly for its impact on
farming, food culture and political formation, but also for its impact on
health; who more than the British turned food from a pleasure into fuel?
134 TIM LANG
(Driver, 1983). Less attention has been accorded to the impact on English
food culture, but even those who argue that England has been unfairly
pilloried as home of a restricted, poor-quality diet (Spencer, 2002) agree that
the debasement of working class diets and the abandonment of any national
or local links with the land coincided.
Others have argued that this poor quality, unhealthy diet was framed by
employers whose interest in pursuing the cheap food policy was driven by a
desire to constrain wages, food being then a heavy factor in the cost of
living. If imported food could be cheaper than home-produced, so much the
better. As a result by the time Britain declared war on Nazi Germany in
1939, it had only a third of its food nationally produced. The so-called food
front was therefore not just a strategic priority the British Isles food trade
routes are and were horrendously vulnerable to air and naval blockade but
it highlighted the lesson others had noted, that food has, in modern
European parlance, multi-functional characteristics. If one needs secure
lines of food supply, as in wartime, that supply has to be able to guarantee
health, affordability and all-year round deliveries. At such times, the ques-
tion posed earlier what is the land for? is easily answered, even if less
easily delivered. Food remains central, therefore, to the purpose and social
value of the land.
These issues are not just of import for a historically peculiar and wet post-
imperial power, off the northwest coast of mainland Europe. What emerges
is an important recognition that even in a country which pushes the the-
oretical possibility of abandoning a viable farming to its near limits, history
suggests that a central, if not the central purpose of the land has to include a
food production function. The policy issue is not so much, pace the British,
whether to produce food but how, on what terms and for whom/what?
Citizens groups are beginning to engage with this agenda, not least be-
cause they have confronted the nature of farming and its impact on the
environment and public health. They have supported the new critical anal-
ysis of what drives change in the food supply chain (Maxwell & Slater, 2004;
Lang, 2003; Marsden, Flynn, & Harrison, 2000a). A combination of new
technologies, investment, inter-sectoral restructuring and change in market
rules, among other drivers, have led to a shift of power along food supply
chain and a period of remarkable concentration throughout. Restless con-
sumers have expressed unease at the worst aspects of modern techniques.
This new consumer critique what might be called a food citizenship has
brought up awkward questions about ethics, prices, global reach and other
manifestations of how food is grown, processed, distributed and (not)
consumed.
Public health is now (re)joining these issues as a key factor in critical

debate after decades of relative silence. Although evidence has mounted as
to foods impact on health (WHO, 1990, 2002; WHO/FAO, 2003; WHO/
IARC, 2003), there has been less concerted or well-organised championed of
policy intervention in the name of health. This period of marginalisation is
now coming to a close. The WHO and FAO, notably, have united to show,
how dietary change is necessary and how food and farming industries need
to produce differently. The Productionist paradigm must alter (Lang &
Heasman, 2004).
THE DIET AND NUTRITION TRANSITION: THE

EVIDENCE FOR POLICY CHANGE
Food is now the Western worlds major cause of pre-mature death. The old
North-South/Developed Developing country dichotomy no longer ade-
quately describes or explains what is happening in food in relation to health.
What Prof. Barry Popkin has termed the Nutrition Transition is now ev-
idenced almost worldwide (Popkin, 1999; Caballero & Popkin, 2002). The
Nutrition Transition is associated primarily with rising wealth and changed
circumstances. The thesis, now extensively supported by country and re-
gional studies (Popkin, 2001) argues simply that diet-related ill-health pre-
viously associated with the West and with afuence is increasingly manifest
in developing countries (Popkin, 1994; Drewnoski & Popkin, 1997). Pop-
ulations are shifting diet from one pattern to another from traditional
diets with restricted range and intakes to a diet involving more snacking,
more western-style fast foods and soft drinks. Rapid urbanisation and
changed patterns of work, in North and South, mean not just a new re-
lationship with the land, but also a redefinition of cultural rules what to
eat, when and how. Sugary soft drinks replace water. Malls, large portion
sizes, snacking and grazing, Americanisation, supermarketisation all
illustrate the emergence of new urban cultures.
In nutrition terms, this dietary change means there is excessive consump-
tion of fats, salt and sugars and under-consumption of fruit and vegetables.
An excess of intake over energy expenditure leads to obesity, which in turn
heralds other diseases. One quick indicator is consumption of soft drinks,
which replaces water or indigenous drinks. In the UK, consumption of
ready-to-drink soft drinks rose from 100 g per person per week in 1975 to
over 500 g in 2001. Low-calorie (articially sweetened) soft drinks have not
136 TIM LANG
added to this market, merely expanded it, as has mineral water. At such
rates of growth, it may not be too long before the dream comes true held by
a late 20th century head of Coca-Cola to have the C on the water tap
(faucet) indicate that what gushes forth is not cold water, but Coca-Cola.
At the global level, policy for the last 60 years has centred on combating
mal-nutrition. Despite huge advances in output, the UNs Food and Ag-
riculture Organisation estimates around 800 millions are still malnourished,
even though the proportion of humanity in hunger has dropped. This is a
considerable success, against rising populations. But there are now far more
people clinically overweight or obese than hungry. By 2003, the WHO and
International Association for the Study of Obesity (IASO), calculated that
up to 1.7 billion people were overweight or obese. Extreme forms of obesity
are rising even faster than the overall epidemic. In 2003, 6.3 per cent of U.S.
women were morbidly obese, with a body mass index of 40 or more.1 The
U.S. Center for Disease Control estimates the cost of obesity and overweight
in the USA as about $117 billion (Centers for Disease Control, 2002).
Obesity and overweight levels in the South are rising alarmingly. Coun-
tries such as India, China and Brazil to name just three of the Souths most
populous and inuential countries now experience rapid growth of diseases
previously associated with the rich North. Yet these countries lack the
health infrastructure to be able to deal with them. They cannot afford either
the by-pass operations, the stomach-tuck operations or the diabetes treat-
ment that even a rich country like the UK is baulking at, according to two
reports produced for the UK Treasury by former banker Derek Wanless
(Wanless, 2002, 2004; Hunter, 2003). The 100,000 stomach operations in the
USA cost the equivalent of the entire health budget of Vietnam, a country of
70 million people (Rayner, 2003). By any ethical yardstick, this is gross and
a distortion of services.
The nutrition transition has immense policy implications. While deliver-
ing sufcient calories to feed all reasonably, there is now oversupply and
continuing misallocation within and between national food supply chains.
The range of foods and their nutrient mix is warped: too much dairy pro-
duce and meat, sugars and cereals for animal food; not enough fruit and
vegetables and biodiversity coming from the eld to the plate (Lang &
Heasman, 2004). The cultural shift that accompanies this change is consid-
erable. The capacity of giant food and (soft) drink companies to frame
culture with their large marketing budgets should not be underestimated.
The top two spenders alone spend around $1.7 billion each per year.
Worldwide, an estimated $40 billion is spent annually on food marketing.
This is 500 times more what the WHO has to spend on promoting healthy
diets (Dalmeny, Hanna, & Lobstein, 2003). In the UK, the food industry
spends 750 million per year, yet the entire UK government spends only
7 million on health promotion, i.e. less than 1 per cent of what industry
spends (Department of Health, 2004). If one looks at what the industry
spends its money on in countries such as the USA or UK, it is hardly a roll
call of health-enhancing products. They tend to be high value-added prod-
ucts and/or processed products with relatively high fat, sugar and salt con-
tents (Lang & Heasman, 2004; Nestle, 2002). The impact such spending has
on lowincome society is hard to calculate, but the shift from indigenous to
externally sourced high-status foods is now seen to carry a health cost.
Dietary change is nothing new. Food cultures have always been in a state
of transition. What marks the current era out as special is the pace, extent
and global reach of this process. Within marketing circles, it has been com-
mon for two decades to talk of the need to create global brands, but modern
food Transnational Corporations are more cautious. Nestle, for instance,
the worlds largest food company which sells 12 per cent of all food sold
on the planet prefers a glocalised rather than a globalised approach
(Simonian, 2005). Consumers, it argues, are different by region and country.
But, while pursuing this glocalised strategy, transnational realities are
coming to haunt the worlds big players. The obesity pandemic in particular
has disciplined and chastened the food giants; threats of litigation and of
state action to curb marketing or internalise externalised healthcare costs
are encouraging them to rush out new products and to encourage sports
activity among the young.
Such corporate action is interesting, not least for how puny it is in effect
of the macro-drivers such as the considerable gap between rich and poor
both within and between societies; these differentials have a direct impact on
public health. The UNs oft-cited statistics are sobering: the richest 1 per
cent of the worlds population, around 60 million, receive as much income
as the poorest 57 per cent, while the income of the richest 25 million Amer-
icans is equivalent of almost 2 billion of the worlds poorest people (UNDP,
2003). The policy response is underwhelming; income differentials are in-
creasing. In 1960, 20 per cent of the worlds population living in the richest
countries had 30 times the income of the poorest 20 per cent; by 1997, the
richest 20 per cent had 74 times the income of the poorest 20 per cent. The
1999 UNDP report called for tougher rules on global governance, including
principles of performance for multi-nationals on labour standards, fair trade
and environmental protection, arguing that these are needed to counter the
negative effects of globalisation on the poorest nations (UNDP, 1999). By
2003, the tone being taken by UNDP was harsher. In its 2003 Human
138 TIM LANG
Development Report, the 1990s were viewed as a lost decade, a period when
inequalities widened rapidly. Fifty countries suffered falling living standards
in the 1990s. UNICEF calculates that 800 million go hungry worldwide
annually. Understandably, policy activists have tended to concentrate on
the indignity and gross hunger that results. But the challenge laid down by
the diet and nutrition transition requires a different order of policy than just
redistribution, north to south.
Even in rich countries like Britain, food poverty exists. In 1977, Walker
reviewed the (in)adequacy of welfare benets and showed that the key
British welfare programme (Supplementary Benet) was inadequate to cov-
er the nutritional needs of the largest 810-year-old children, however ef-
cient their mothers food purchasing behaviour (Walker & Church, 1978).
In his study of 231 at-risk children in poor areas of London between 1973
and 1976, Nelson found a close relationship between restriction of income,
poor diet and small size of child (Nelson & Naismith, 1979). He concluded
that at least 11 percent of the children in this study are mildly to mod-
erately malnourished and called for dietary intervention. In a later study,
despite showing that school meals failed to provide the nutritional targets
set for them by government, Nelson showed that they were the most im-
portant nutritional support outside the home for low-income families
(Nelson & Paul, 1983). The impact on health is considerable. The British
National Food Survey, a comprehensive annual governmental survey since
the 1940s, suggests how the food gap between rich and poor has widened in
some areas. On vegetable consumption, for instance, over the quarter cen-
tury since 1975, the more afuent have eaten more, while the poor have
consumed less. The rich eat much more fruit, sh and vegetables than the
poor. In 2000, the UK National Diet and Nutrition Survey found only one
in ve male young people aged 418 years ate any green vegetables in a
week, and one in ve children ate no fruit in a week and three in ve ate no
leafy green vegetables (Caraher & Anderson, 2001).
Such studies are reminders that supposedly modern debates about con-
sumers, food and class are not new, nor has the problem necessarily been
dissipated by rising national wealth (Riches, 1997). In the USA, hunger has
been a persistent cause of concern for decades. A mid-1960s study reported
that 9 million Americans had decient diets. By the mid-1990s, after decades
of argument about how to measure hunger, the U.S. Census Bureau cal-
culated that 11 million Americans lived in households which were food
insecure with a further 23 million living in households which were food
insecure without hunger (Eisinger, 1998). U.S. surveys estimated that
at least 4 million children under age 12 were hungry and an additional
9.6 million were at risk of hunger during at least 1 month of the year
preceding the survey.
A 2003 assessment by the Economic Research Service of the United States
Department of Agriculture (USDA) is that 11 per cent of American house-
holds were food insecure at least some time in 2002, meaning that they did
not have access, at all times, to enough food for an active, healthy life for all
household members (Nord, Andrews, & Carlson, 2003). According to ERS,
the prevalence of food insecurity in the USA rose from 10.7 per cent in 2001
to 11.1 per cent in 2002, and the prevalence of food insecurity with hunger
rose from 3.3 to 3.5 per cent of the population this in the richest nation on
earth. The ndings of such surveys provokes vitriolic criticism from U.S.
conservative political groups; they have particularly focused on such studies
often determining hunger through self-reports (Sidel, 1997). Proper scientific
(weighed and measured) studies are expensive and tend to be low on the
research agenda of rich countries. The UKs Food Standards Agency ini-
tiated a rare exception in 2004 (due to report in 20062007). Pending results,
studies using self-reported hunger measures, at least for adults, are probably
valid surrogate measures for low intakes of required nutrients. It should be
remembered that if there was not a problem, why did a country like the U.S.
spend over $25billion on federal and state programmes to provide extra food
for 25 million citizens? (Eisinger, 1998). Some welfare programmes have
indeed been framed by the need to dissipate stocks.
While income and socio-economic class are still key determinants of food
consumption patterns, class formations are no longer bounded within na-
tions alone. As has been noted for marketing earlier, there are other factors
at play such as ethnicity, and family experience. Sociologically, it might be
more meaningful to conceive of emerging global consuming classes (see
Table 5) (Durning, 1992). These t alongside another three broad categories
of poorly consuming food classes worldwide (see Table 6) (Gardner &
Halweil, 2000).
THE SOCIAL SCIENCE CONTRIBUTION TO THE

FARM-FOOD-HEALTH NEXUS
A more serious social scientific look at the relationship between farming,
food and health is long overdue. Public health is the sleeping giant of the
new critical literature on food and farming. The health dimension helps
to illustrate the cultural and economic drivers of modern food systems.
140 TIM LANG
Table 5. World Consuming Classes.

Category of High Middle Poor
Consumption
Population 1.5 billion 3 billion 1.5 billion

Diet Meat, packaged food Grain and clean Insufcient grain and
and soft drinks water unsafe water
Transport Private cars and air Bicycles and bus Walking
Source Long-distance foods; Some long-distance Local food; local
hypermarket and food; local shops shops and markets
delicatessen/ and markets
specialist shops
Materials Throw-aways Durables Local biomass
Choice Big choice; global Sufcient and Limited or absent
horizons regional horizon and local horizon
Environmental High Considerable Low
impact
Source: Adapted from Durning (1992).
Table 6. Types and Effects of Malnutrition.

Type of Malnutrition Nutritional Effect Number of People Affected
Globally (Billion)
Hunger Deciency of calories and At least 1.2

protein
Micronutrient deciency Deciency of vitamins and 2.03.5
minerals
Over-consumption Excess of calories, often At least 1.21.7
accompanied by deciency
of vitamins and minerals
Source: Worldwatch Institute (Gardner & Halweil, 2000) based on WHO, IFPRI, ACC/SCN
data.
Conscious of the sheer weight of data of the spread of degenerative diseases

in the developing world, and the lessons from the developed world of just
how costly they can be, a policy debate is now at last emerging in global
forums such as the WHO and FAO as well as in regional and national
bodies. The Nutrition Transition concept has informed much of the for-
mulation of the Global Strategy on Diet, Physical Activity and Health,
approved at the World Health Assembly in May 2004 (WHO, 2004). This
Strategy has been highly sensitive, with strong lobbying against it from
sugar, fat and highly processed food interests. Their sensitivity is apt, as a
new paradigm is emerging in which health would once again shape what
farming does, and what the land is for. A shift from fat to fruit, monoculture
to biodiversity promises health not just environmental gains. A study
(funded by threatened sectors) into what would happen if the WHO-FAO
916 report was applied to world agriculture worldwide suggested consid-
erable dislocation of current investment. Pig meat production would have to
drop by 5 per cent, Butter by 13 per cent, Cream by 18 per cent, Animal fat
by 31 per cent, Soybean oil by 14 per cent and Rapeseed oil by 3035 per
cent, and so on (Irz, Shankar, & Srinivasan, 2003). A similar study pointed
to major threats to the sugar industry if there was a drop in sugar-based
foods (Irz, 2003). Interestingly, no one has funded what opportunities for
farming lie in a shift to grains for humans (rather for than animal feed)
or to fruit and vegetables, or for simpler rather than more value-added
processing.
A tense policy engagement is now underway between WHO and large
food corporations, to which social science, with its understanding of the
realities of food production and corporate reach, could usefully contribute.
The stakes are high, not just for public health, but for governance and the
legitimacy of governments to act on the citizens behalf; the (im)balance
between corners of the holy triangle is at stake. Large companies have
strong grounds for resisting any regulation or impediments on their right to
trade. Equally, others see an opportunity for new niche products, although
it is uncertain whether such alterations in product mix will deliver the major
dietary change required for health. Profits and market share are at issue. But
so too is a narrow conception of consumerism. Major rather than minor
changes in daily food purchases are needed to accompany changes in how
and why food is produced, what the land is for, what our bodies require to
perform optimally? Can any sensible theorising of the new world-food order
seriously accept the kind of rubric that marketers and economists offer, such
as that consumers are in command? If consumers only know at best around
100 Known Value Items (KVIs), out of say 25,000 on offer, how discrim-
inating can consumers really be? The issue at stake is how to weigh up what
consumers really want in relation to what they need for bodily (and cultural)
health.
A food and farming system that focuses on choice in the marketplace, but
marginalises public health does not deserve intellectual let alone societal
support. Policy-makers are already aware of the urgent need to build en-
vironmental protection into how food is produced and sold. The arrival of
the new public health evidence and analysis could and should alter how
policy-makers conceive of future food and farming policy. But, whether they
make this mental leap, history suggests, will not just be a matter of evidence.
142 TIM LANG
Crises such as climate change, water shortage, soil erosion, and over-reliance
on oil as the motor of the food system all these are candidates to be
straws that nally break the current dominant policys back. Unfortunately,
if the back breaks, it will not just be a system but lives and ecology that fails
too. The need for social scientists working in food and farming to engage
with this policy, reality has never been stronger. But the importance of
health in this unfolding policy dynamic cannot be underestimated.
NOTES
1. BMI is a simple index of weight-for-height: a persons weight (in kilos) divided
by the square of the height in metres (kg/m2). BMI provides in the WHOs words
the most useful, albeit crude, population-level measure of obesity. A BMI of
between 25 and 29.9 is considered overweight giving the global gure above of
750 m. Obesity is a BMI of 30 and above giving the 300 m global gures. A BMI of
less than 17 is considered underweight. Another relevant indicator is body fat dis-
tribution, often assessed by the waists circumference or the waisthip ratio. There is
some argument about whether the definition of overweight as being a BMI within the
2529.9 range should be lowered. A WHO consultation in Singapore in July 2002
considered lowering the threshold from 25 to 23, in which case billions more people
would be considered overweight. It was this re-classication, which contributed to
the radical upward revision of world obesity gures.
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PROMOTING SUSTAINABLE
DEVELOPMENT: THE QUESTION
OF GOVERNANCE$
Geoffrey Lawrence
ABSTRACT
Despite continuing disagreement about the meaning of sustainable de-
velopment, the so-called triple-bottom-line trajectory which would see
economic advancement being achieved alongside social equity and envi-
ronmental security is viewed as one of the promises for future progress
regionally, nationally and globally. At the regional level we are witnessing
various experiments in governance that cut across, challenge and under-
mine existing decision-making structures. They are being developed and
implemented because of the perceived failure of older forms of governance
to deliver sustainable development. This chapter will examine the
regional experiment that is occurring within the advanced societies,
identifying the general features of the schemes, policies and programmes
that are being promoted to bring about sustainable development. From a
policy perspective, it will seek to identify the elements, and forms, of
regional governance that appear to provide the best options for sustain-
able development.
$
This chapter is an extended version of a plenary paper presented at the XI World Congress of
Rural Sociology, Trondheim, Norway, 2530 July 2004.

ISSN: 1057-1922/doi:10.1016/S1057-1922(05)11006-3
145
146 GEOFFREY LAWRENCE
INTRODUCTION
Throughout the world and at a time when sustainable development

is being viewed as a medium term imperative rather than some nebulous,
hoped-for, long-term, goal attention is being given to the improvement
of natural resource management and to the livelihoods of people outside
the metropoles. New policies and new forms of governance have emerged,
including new institutions and policy frameworks. In Australia as in
so many countries around the world voluntarism and self-help strategies
have gone hand-in-hand with regional priority setting and decision-
making in the area of environmental protection. There is an effort to
address the so-called triple bottom line of economy, society and environ-
ment so that economic ambitions are tempered with a respect for social
equity and environmental integrity, with the economy being forced to take
its place as only one of three elements in the calculus of sustainable
development.
Some sociologists such as Archon Fung and Erik Olin Wright, whose
work forms a part of the creatively named Real Utopias Project (em-
bracing the tension between dreams and practice see Fung and Wright
(2003, p. 7)), consider that what we are witnessing is the emergence of
empowered participatory governance. They argue that traditional modes of
political representation are frustrating the democratic ambitions of citizens,
and that a radical egalitarianism may be possible if the newlyemerging
participatory opportunities afforded by such initiatives as neighbour-
hood councils, administrative and scal devolution and stakeholder in-
volvement in habitat conservation planning are supported (Fung & Wright,
2003, p. 5).
This chapter argues that what we are witnessing throughout the so-called
advanced world are experiments in sub-national regional governance that
are themselves a response to wider problems in managing global capitalism.
Rather than solving the problems that are emerging, and rather than
unequivocally producing a dynamic that leads to sustainable development,
they appear to be generating their own tensions and contradictions some
of which will not be readily resolved within, and indeed may be exacerbated
by, the structure of global neoliberalism. What, however, might represent a
progressive response abandoning notions of sustainability and regionality
because of the inherent problems and difculties, or seeking to support
sustainable development by improving structures of governance at the
regional level?
Promoting Sustainable Development: The Question of Governance 147
SUSTAINABLE, AND UNSUSTAINABLE,

DEVELOPMENT
One does not need to sit through the 2004 disaster lm The Day After
Tomorrow to recognise the environmental problems that the planet faces as
a result of modernisation and industrialisation. We see the signs around us.
It is widely acknowledged that industrial pollution, species decline, loss of
habitat, increasing demands on fresh water, the erosion of beaches and
coastal lands and global warming are directly attributable to human activity
(Held, McGrew, Goldblatt, & Perraton, 1999; IPCC, 2001). Just as impor-
tantly, we can see a parallel in human devastation in the wasted lives of
those who are the victims of global change (Bauman, 2004).
The rst popularly accepted definition of sustainable development
arose from the report of Norwegian Gro Harlem Brundtland who,
with her Commission members, suggested in 1987 that the world should
be meeting the needs of the present without compromising the ability of
future generations to meet their own needs (World Commission on Envi-
ronment and Development, 1987). It was a profound statement at the time
and a strong reminder to the disposability-is-progress generation that prof-
ligacy and disregard for the environment would lead to intergenerational
inequities and eventual ecosystem collapse. Of course, as a rather slippery
term, sustainability can mean the maintenance of intergenerational well-be-
ing; ensuring the continuation of human life indefinitely; maintaining the
productivity of economic systems; maintaining biodiversity; and a combina-
tion of these (and other) things (see Gowdy, 1999, p. 164). It can be weak or
strong, or reformist or radical or be about intragenerational equity as
much intergenerational equity (see Eichler, 1999; Gowdy, 1999; Gray &
Lawrence, 2001). Ironically, sustainability is also seen as a grand narrative in
a post-modern era that, itself, rejects grand narratives (Myerson & Rydin,
1996).
The three elements of sustainability the economy, society and environ-
ment have been, and continue to be, treated separately in academic writ-
ings and in public policy. Yet, sustainable development is premised on a new
balance being achieved between the three elements with an effective
integration of those elements in public and private decision-making proc-
esses (Bates, 2003). But how might these elements be interconnected? As
some writers (Giddings, Hopgood, & OBrien, 2002) have argued, that each
is multi-layered, fractured and must, as well, be considered at different
spatial levels. As a further complicating issue, in differentiating countrysides
there may be a number of alternative trajectories for sustainable develop-

ment (Marsden, Murdoch, & Abram, 1997).
In rural regions of the so-called advanced societies we have witnessed the
entrenchment of productivist or high tech farming systems. This is despite
growing recognition that productivist agriculture is largely unsustainable
(Altieri, 1998). Its persistence is logically consistent with global neoliberal or
free-market policies as they are applied to farming. Hoping to survive in an
increasingly competitive international marketplace farmers obey market
signals and adopt the behaviour required to ensure their futures in farming.
This generally means specialising in production, intensifying and expanding
farm operations and purchasing the latest products of agribusiness to gain a
competitive edge through increases in productivity and efciency (see Ilbery
& Bowler, 1998). Yet, the pursuit of this has devastating effects on the
environment. The clearing of vegetation to bring land into production for
agriculture and grazing results in topsoil loss and very often as water
tables rise to salinisation. There is also evidence, worldwide, of overcrop-
ping and overgrazing as farmers seek to secure increases in production in the
face of declining prices and poor seasons (OConnor, 1994; Martinez-Alier,
1999; Lawrence, Cheshire, & Richards, 2004). We also know that the prod-
ucts of agribusiness in concert with management regimes that endorse or
demand monocultural practices and blindly obey world market forces are
implicated in widespread environmental destruction (Magdoff, Foster, &
Buttel, 2000). When this is applied to Third World settings, we see how
jaundiced a green revolution is for the poor of the world (McMichael, 2004).
Finally, it has been argued that the current rules of global trade set by the
World Trade Organisation (WTO) promote harmonisation as an important
part of liberalisation. This translates, however, into a narrowing of choice
for nation states in their attempts to deal with environmental outcomes of
economic activity (Levidow, 2005).
Some sociologists and geographers have detected the emergence of a post-
productivist and multi-functional countryside particularly in Europe
where there are pressures for continued protection of agriculture, support
for local communities, along with the greening of the Common Agricul-
tural Policy (Holmes, 2002; Tilzey, 2003). But others (Wilson, 2001; Argent,
2002; Walford, 2003) have argued that there are only slight traces of such
positive change being observed in many of the countries where environ-
mental pollution from farming is at its worse. Nevertheless, pressured by
consumers anxious about food quality, animal welfare and a host of
environmental matters, there is discernable political pressure for the move to
what Marsden (2003, p. 4) has termed a paradigm of rural sustainability,
or what we have termed in Australia as sustainable regional development

(Lawrence, 1998; Dore & Woodhill, 1999; Lawrence, 2003) a form of
organisation that would seek to secure sustainable livelihoods at the re-
gional (sub-national) level.
The basic argument in this chapter is that the dynamic of productivism
can be challenged and potentially replaced by triple bottom line ap-
proaches, and that these approaches might be best achieved at the regional
level on the basis of partnerships between the state and communities. But a
second, less optimistic, assertion is that new contradictions are beginning to
appear that threaten to undermine the emerging inclusive, adaptive, part-
nership approach to regional sustainability.
EXPERIMENTS IN REGIONAL GOVERNANCE AND

THE GOVERNANCE OF NATURAL RESOURCES
From North America to Europe to the Antipodes there has been an enor-
mous shift towards decision-making at the regional level. Governance is
about structures and processes that allow for strategic decision-making
outside the traditional institutions and agents given power to govern
(Jessop, 1998). The new governance framework is based upon the reinven-
tion of government through multi-level partnerships, knowledge exchange,
devolution of decision-making and joined up inter-institutional arrange-
ments. Bureaucratic and technical accountability is being steadily replaced
by the building of coalitions and networks at the local level (Reddel, 2002).
There is a blurring of the boundaries between the public and private spheres
as various partnerships evolve (Head & Ryan, 2003) and as state activities
are supplemented by a network of self-governing actors capable of re-
dening relations between institutions (Stoker, 1998). As Lovering (1999,
p. 390) has noted, whereas in the decade of the 1980s there were over 400
regional development agencies worldwide, at the end of the 20th century
there were more than 4,000. He is also quick to note that the new region-
alism has all the elements of global neoliberalism (with its concerns for
competition, the marketplace and business integration) rather than embod-
ying an agenda for comprehensive regional development (Lovering, 2001).
In Europe, the devolution of authority from central governments to sub-
national bodies has been a logical extension of the subsidiarity principle
that decision-making should occur at the lowest appropriate level and it
has fostered regionalism through the reliance on multi-level governance
(Gleeson, 2003). Recent regional policy initiatives are concerned with sus-
tainability of regions rather than with the more narrow concern for income
and trade performance (Gleeson, 2003, p. 232). In the US, new alliances are
forming across existing legislative boundaries with habitat conservation
planning now occurring at ecosystem scales and so bypassing statutory
standards and procedures, and involving a multiplicity of people and agen-
cies in a new arrangements of power (Karkkainen, 2003).
With the EUs LEADER Programme, a new localism (that is, the cre-
ation of integrated plans for local development and the attempt to enlist the
participation of the socially marginalised) has been viewed as a direct re-
sponse to rural socio-economic decline (Moseley, 1999). Although it has
been based upon rural development rather than sustainability, per se,
LEADER during the 1980s and 1990s sought to create through its Local
Action Groups, and in hitherto marginalised areas, an enterprise culture,
better service delivery, community empowerment and social inclusion in
decision-making (Westholm, 1999) thereby anticipating what would
evolve, in the new millennium, into new governance models in Europe.
In Europe, documents such as the White Paper on Governance, the En-
vironmental Action Programme and the EU Sustainable Development Strat-
egy (see CEC, 2001a, b, c) embrace the need for various tiers of government
to interface in a manner that promotes opportunities for integrated ap-
proaches to decision-making at the regional level and for citizen empow-
erment via capacity building (Berger, 2003). The EU is concerned that
people are showing increasing distrust for distant and faceless institutions
making decisions about their lives. Local and regional bodies and govern-
ments are therefore to be involved in partnership arrangements as part of a
different set of policy tools aimed at reducing the alienation and power-
lessness that is perceived to be a current feature within the Union (CEC,
2001a, p. 7). It is asserted that inclusiveness and accountability will be
achieved through the reform of governance arrangements (CEC, 2001a,
p. 8). The two basic elements of EU policy are the inclusion of wider sections
of society, and multi-level government (Berger, 2003, p. 231). Of course, the
preoccupation with the structures of governance over process-related con-
cerns can gloss over the politically sensitive issue of who holds power, and
how and for what purposes that power is used.
According to Harriet Bulkeley and co-workers at the University of
Durham in the UK, the development of multi-level governance (that is,
involving actors and institutions from the public agencies, private businesses
and civil society and at local, state and global levels) can be seen in the
emergence of what are being termed transnational municipal networks or
TMNs (Bulkeley et al., 2003). Another example is that of the so-called

joining up of decision-making bodies at a multi-level scale with partner-
ships rather than hierarchies being the new organisational framework
(Geddes, 2003).
Leaving aside these examples, it is instructive to consider the experiment
in sustainable regional development that is occurring in Australia. Australia
has a very large landmass, but is the second driest continent (after Antarctica)
in the world. In the last 200 years of white settlement, European-style ag-
riculture, and grazing, together with tree clearing and reliance upon irri-
gation from unreliable river systems has created major environmental
problems. The latter have included soil erosion, waterlogging, the salinisat-
ion and acidication of pastures, agro-chemical pollution of waterways,
species decline and the uncontrollable spread of weeds. Perhaps, not sur-
prisingly, many of the so-called weeds have been introduced in earlier
decades as the supposed solutions to productivity losses in Australian
agriculture and grazing (see Gray & Lawrence, 2001).
Although State governments had been charged with the development of
agriculture and the management of the environment, the Federal govern-
ment recognised that if the nation were to address the quite severe problems
of environmental degradation in the regions it would need to intervene. But
intervention in recent times has not taken a form of top-down regulation.
Rather, in consultation with the States, the National Farmers Federation
and the Australian Conservation Foundation, the so-called Decade of
Landcare was born in 1989, with the introduction of the National Landcare
Programme. The aim was to stimulate the creation of locality-based com-
munity landcare groups that would take responsibility for on-the-ground
actions to address environmental problems (Lockie, 2004). The Federal
government provided funding to underpin group formation, to inspire a
higher level of knowledge of the environment and for such activities as tree
planting, catchment planning and demonstrations of environmentally sound
practices (Campbell, 1994). The landcare programme has exceeded expec-
tations of government, with more than 4,000 groups comprising some
120,000 volunteer workers being established throughout the nation (see
Mues, Chapman, & Van Hilst, 1998; Lockie, 2004, p. 43). This represents
approximately one third of Australias farms, with many other regional
stakeholders also becoming actively involved. Its success is viewed in terms
of: developing robust relations between state agency ofcials and local
communities; increasing the awareness throughout the rural community of
environmental issues; improving landholder skills; and enhancing best man-
agement practices (Curtis, 2003, p. 447). Featuring ideals of consensus and
partnership, the landcare movement is viewed by some as an example of a

successful participative democratic structure that is a successful way of
promoting more sustainable development (Alexander, 1995).
As part of the new direction in community-based natural resource man-
agement, and based upon the success of landcare, Australias Federal gov-
ernment endorsed the community-partnership model as greatly benecial
for Australian natural resource management (Standing Committee on
Environment, Recreation and Arts, 2001, p. 24). In 1997, the Natural Her-
itage Trust (NHT) was initiated with $1.5 billion in funding having been
assigned to projects up until mid-2001, and with another $1 billion being
allocated to extend the scheme for another 5 years. This represents one of
the biggest environmental investments by the government in Australias
history, with its Landcare, Bushcare, Rivercare and Coastcare programmes
relying upon regional delivery as the primary mechanism.
Under these various schemes regional communities (comprising land-
owners, businesses, NGOs, local, State and Territory governments) are for-
mulating the so-called Accredited Natural Resource Management Plans.
These plans dene the most important activities for state investment and,
therefore, for action at the regional or catchment level.
Catchments are viewed as natural geographical structures that do not
conform to State or local government boundaries. The aim, then, is to
promote an environmental identity across existing political boundaries and
within the catchments. Limited powers are being given to regional bodies
(catchment management groups and authorities) to provide leadership in
natural resource management issues, undertake regional and local planning,
undertake on-ground management and monitoring and to initiate extension
and capacity building exercises. While State and local governments are still
required to administer land and water legislation and regulation, it is in-
dividuals, companies and various stakeholders who are viewed as those
who will be responsible for on-ground actions to improve the environment,
and to promote regional sustainability (Standing Committee on Environ-
ment, Recreation and Arts, 2001, p. 27).
What can be said of these Australian attempts to promote sustainable
development through community?
They do represent an attempt to:
Mobilise community and stakeholder participation and foster wider part-

nerships with government.
Identify the sub-state (catchment) region as the most important scale for
delivery of sustainability outcomes thereby moving beyond the
structures of representative democracy (federal, state and local govern-

ment).
Highlight the need to see environmental integrity as an essential compo-
nent of regional progress thereby moving from regional economic de-
velopment as the key focus to sustainable regional development as the
future.
Seek to have communities develop frameworks for action that go well
beyond the short-term cycles of federal and State budgets (Curtis, 2003;
Lawrence, 2003).
But, as we might expect, the success of the Australian experiment in gov-
erning sustainability must be tempered with some critical assessment. There
have been ve main criticisms of the voluntary governance approach to
sustainability in Australia:
Landcare was deemed a success with one-third of primary producers
being involved. Some have asked who are these people and what about
the other two-thirds? In some cases, landcare groups formed to block the
entry of environmental, and other, stakeholders in decision-making. In
other words, some people and groups were deliberately excluded from
landcare activities (Morrissey & Lawrence, 1997). In some areas, the ma-
jority of producers could be involved in quite profound soil, water and
biodiversity destruction, with their involvement in landcare no more than
an ideological shield to help protect them against the widespread criticism
that might otherwise have ensued.
There is evidence that governments, through the new natural resource
management (NRM) initiatives, are devolving responsibility, rather than
power. Some NRM groups devise regional plans and priorities only to be
told by central government that these are not the main concerns at the
federal level. Powerlessness rather than community capacity is fostered
in such circumstances. The so-called purse strings are held very tightly by
central administration.
The move to partnership arrangements and the winding back of top-down
forms of planning can only occur if new support structures (and people)
are in place to support the new arrangements. The progress is slow and
very frustrating for regional bodies that have been told they will be given a
licence to create a new sustainable future. The time that they are able to
devote to community activities is also quite limited, with burnout being a
major problem (Curtis, 2003).
Without coordination of government services in natural resource man-
agement, regional resource-use planning is being viewed as another level
of bureaucracy one which has the potential to duplicate (rather than to

support and complement) current planning activities.
Finally, Landcare has as one of its mottos the right environment to do
business. It is premised on the view that sustainability can be achieved
within a system of agricultural productivism. Interestingly, a number of
companies in its sponsorship list are implicated in some of the worst
environmental destruction in Australia. It is no wonder then, that some
consider Landcare and its contemporary equivalents a greenwash, al-
lowing environmental degradation to continue while giving corporate en-
tities public credibility in the environmental arena (see discussions in
Lockie & Vanclay, 1997; Gray & Lawrence, 2001; Curtis, 2003).
It has been posited that protests against the impacts of neoliberalism and the
backlash against globalisation have prompted governments to seek more
participatory means of governing (Paterson, Humphreys, & Pettiford,
2003). This is seen as a deliberate means of counteracting opposition by
embracing dissent (Paterson et al., 2003) and has, at its heart, the necessity
to secure long-term legitimacy. The globalisation of capitalism is a polar-
ising process, creating wealth in some regions and poverty, unemployment,
marginalisation and exclusion in others (Sanderson, 2000; Gray &
Lawrence, 2001; Bauman, 2004). And, under policies of neoliberal marketi-
sation, the state is no longer willing or able to place a generous safety net
under those disadvantaged by change (Geddes, 2003).
WHAT MIGHT BE GOING ON HERE?
Globalisation represents a re-ordering of the world, with market rule as the

dominant discourse (Peine & McMichael, 2005). Neoliberalism is generating
a series of economic rationalist policy settings that are fostering free-
markets, global ows of nance and socio-economic integration. If the
1940s General Agreement on Tariffs and Trade embraced the ideal of na-
tional sovereignty, then the new centurys WTO can be viewed as a global
governing entity prioritising the needs of the corporation over the commu-
nity (Peine & McMichael, 2005). Although mediated by the nation state,
regional locales are interacting with global rms in a manner that supports
those advantaged by access to information technology, skilled labour and so
forth. But, at the same time that global ows of capital, products, technol-
ogies and knowledge are accelerating, so are concerns about the sustain-
ability of those activities. The so-called greening of western society has, as
one of its prominent features, the growing demand by citizens for environ-
mental security (see Brand, 1997). This is becoming something that the state
is struggling to achieve through conventional regulatory mechanisms. For
this reason, the shift from top-down government to new forms of govern-
ing represent not the demise of state authority but a form of re-regulation
which attempts to resolve some of the contradictions inherent in capitalist
expansion and its consequent impacts upon the ecosystem. A governance
model accepts that subsystems like bioregions are the site for networking
and other arrangements that might allow global processes to be managed
in a manner that if not ultimately protecting the environment, at least pro-
vides new options for longer term environmental security. The regions are
an experiment in the promotion, and governing, of sustainability.
The work of Nicholas Rose (1996) is useful to consider here. He has argued
that statist ideologies based on notions of society are being replaced by those
of community with the subsequent growth of a new territory of adminis-
tration being the locale (neighbourhood group, community for the purposes
of argument here, the region), necessitating a re-conceptualisation of the re-
lationship between the state, the market and civil society. Elected govern-
ments, in his view, identify and promote the interaction between various
stakeholders, rather than impose top-down decisions. Neoliberalism appears
to have endorsed and fostered the self-regulation of individuals and commu-
nities which, at the regional level, equates to the acceptance of programmes,
techniques and procedures that support market rule, productivism and global
competition (Higgins, 2002; Herbert-Cheshire, 2003) while, at the same time,
seeking to promote sustainable development. The partnership approach that
is part of contemporary governance is infused with ideals of community and
empowerment. Under advanced liberal rule, the conduct of individuals and
communities is shaped by notions of entrepreneurialism and capacity building
with those electing to oppose these discourses and policy settings marginalised
and, indeed, blamed for their own demise if they and their communities fail
to thrive (see Higgins, 2002; Herbert-Cheshire, 2003, p. 280). State agencies
are viewed as exerting action at a distance, with self-assessment and self-
regulation replacing state coercion through regulatory mechanisms.
As Karkkainen (2003, p. 220) reports, decision-making about environmental
matters is moving to a model of collaborative problem solving at multiple,
nested spatial scales. He considers the driving ambition of ecosystem man-
agement is to create new human institutions matched to the scales of crucial
ecological processes (Karkkainen, 2003, p. 221). The result is the emergence
of hybrid institutions featuring collaborative arrangements between a host of
government, business and community entities creating a complex web of
institutional recongurations in which the state continues to play an important

role in the provision of resources. This is broadly consistent with Fung and
Wrights (2003) assessment of what they term empowered participatory gov-
ernance which is typied by: the devolution of decision-making powers to
empowered local entities; linkages of accountability to superordinate bodies;
and transformations in current forms of representative government.
Fung and Wright (2003) argue that this new model is not that of the New
Left where the devolution of power would manifest itself in autonomous
decentralisation (or even regional government). Rather it is viewed as coor-
dinated decentralisation where partnership arrangements allow for multi-level
power re-alignments. Fung and Wright implicitly believe that empowered
participatory democracy has a more radical potential than the earlier rev-
olutionary notions of capturing the state. Why? Because local citizens, in
new decision-making networks where there is some semblance of equality of
power, have the capacity to make changes and challenge the structures of
bureaucracy that were, in the past, barriers to social change. Importantly,
they do so with the blessing of the state which is eager to see the mobilisation
of popular participation and the resolution of complex local problems
through the process of reasoned deliberation (Fung & Wright, 2003, p. 24).
While accepting that there might be damning aws in their model, Fung
and Wright (2003, pp. 2938) consider that empowered participatory
democracy should be readily embraced as an alternative to the failures of
earlier statist policies that relied upon mechanisms of representative govern-
ance and bureaucracy to deliver fair and equitable solutions to regional
problems. While we might question the ability of rural citizens to become
engaged, reexive, participants in the new arrangements from a position of
social disadvantage (see Gray & Lawrence, 2001; Cheshire & Lawrence, 2004)
one in which many in rural and regional areas experience social isolation,
exclusion and deprivation and where environmental problems remain largely
unsolved it is nevertheless important to note that many regional people have
embraced this change as representing a genuine attempt to give them a voice
and to achieve action in regional development matters (AFFA, 1999).
THE TENSIONS AND CONTRADICTIONS OF

DEVOLVED GOVERNANCE
Not surprisingly, many writers who have examined the emergence of new
forms of governance have not been wholly convinced of their capacity to
deliver outcomes that challenge current trajectories or that provide for a

sustainable future. There appear to be ve major concerns:
Regional Bodies Challenge the Power of the Entities that have Created
them, yet they Rely upon that Central Power for their Existence
While it is claimed that the movement from government to governance is

something innovative, dynamic and empowering for citizens, the regional
bodies have tended to exist alongside existing tiers of government, rather
than replace them. The regional bodies therefore must deal with the current
tiers. There is evidence to suggest that for many people in regional decision-
making bodies the experience in dealing with existing state and other
bureaucracies is frustrating and, indeed, disempowering and that they are
beginning to challenge the legitimacy of the very state entities that approved
of their formation. The claim is often made that there is an institutional
incapacity in the older structures of representative government that must be
overcome for progress to be made at the regional level. Will these new
bodies wrest power from the centre? If not, will they be content to remain
as the poor cousins of one or more existing level of government?
Local level coalitions and partnerships act upon and transform institu-
tional structures of government (Goodwin, 1998). What if this directly
challenges current power structures and arrangements? Because the new
forms of governance move within and between current forms of authority,
their functions can be readily questioned. And, because they are dependent
upon central funding, they can disappear with a withdrawal of that funding
(Westholm, Moseley, & Stenlas, 1999). As Shortall and Shucksmith (1998)
remind us, if funding is a main stimulus for the creation of partnerships, it is
quite likely that those partnerships will collapse if and when funding is
withdrawn. Furthermore, ephemeral arrangements neither inspire com-
mitment from stakeholders, nor give hope that longer-term options will be
either discussed or pursued by partnerships. There is an assumption that
partnerships will be a better (that is more efcient, inclusive and transpar-
ent) way of delivering outcomes at the local level. However, as Geddes
(2003, p. 15) has argued:
Most partnerships are only weakly constituted in organisational terms,
and the great majority have only very limited dedicated staff and nancial
resources. It is asking a great deal for such weak local organisations to
achieve the kind of joined up deliverythat government itself nds very
difcult.
Rather than Being Inclusive, Regional Bodies can Exclude

Key Stakeholders
There are often elaborate attempts made in the regions to ensure that all key
stakeholders are represented on the new bodies. There are some problems
here. First, groups have differential power and resources with some having
the capacity to lobby within groups, and behind the scenes to promote
their positions on particular issues. In Australia, many of the stakeholders on
catchment management committees are farmers, graziers, local government
ofcials and small business owners with the nancial wherewithal to travel
long distances and stay often for several days at distant venues within the
catchments. Younger people, and indigenous Australians are usually notable
by their absence. Second, even if representation were equitable at the local
level, it could readily be argued that some of the main stakeholders in sus-
tainable development are those outside the regions those whose livelihoods
are strongly affected by those living in, and making decisions about, the
catchment. When rounds of priority setting occur in the formulation of
catchment management or regional development plans where is the voice of
the city environmentalist, the overseas consumer or, as Actor Network the-
orists would remind us, where is the voice of nature? Indeed, some have
criticised the current construction of sustainability for its anthropocentric
bias for interpreting the environment as primarily a resource for human
use, rather than being valued for its own integrity (Doyle, 1998).
Partnerships between a multiplicity of actors increasingly allow individ-
uals and groups from business and community sectors to take what are, in
essence, political decisions in regard to policy and funding. Although it is
believed that transparency and visibility of decision-making processes might
help to overcome this problem, it nevertheless remains that local elites
often politically savvy and nancially advantaged can increase their power
while at the same time denying it to already marginalised and excluded
groups in the community (Westholm, 1999; Walker & Hurley, 2004). Parti-
cipative processes do not guarantee that decision-making will escape an
already-entrenched power regime.
The New Arrangements for Sustainable Development may Embrace and

Foster Productivism Rather than Replace it
Citizen power might boost the condence of local people, without really
addressing the wider system of productivism and its unsustainable trajectory.
On many regional bodies charged with sustainable development sit primary

producers whose modus operandi is to harness the latest products of science
and agribusiness to increase productivity. The need for a radical re-assessment
and re-alignment of production regimes is literally off the agenda. Indeed, in
the Australian context, producers have in the face of new knowledge about
environmental degradation been found to deny the evidence; contest the
evidence; or, even where they accept the evidence, either blame governments,
or maintain that they do not have the nancial wherewithal to alter their
current production regimes (see Lawrence, Richards, & Herbert-Cheshire,
2003). Some are, of course, adopting best management and other restorative
practices (Lockie, 2001). The question is: will incremental change, rather than
radical change, be enough to bring about sustainability? There is evidence,
worldwide, that the problem will get worse before it gets better, with critics
calling for the emergence of an entirely new global system of production and
distribution as the only means of achieving sustainability (see Davies, 2004).
Part of the problem is that when left to orthodox economists, the prob-
lems of environmental degradation and regional socio-economic degener-
ation are conceived as market failures. All that is apparently needed is better
mechanisms to cost environmental problems, and to allow better market
access so that there will be increased trade in environmental goods, and in
relation to regional development the removal of labour market restraints
so that wages become cheaper and business is attracted into the regions (see
a critical discussion in Gray and Lawrence (2001)). It could be argued that
justications for the continuation of neoliberal policy settings as the basis
for sustainable development empty the latter of any real transformative
potential.
In Europes so-called lagging regions there is a very strong pressure for
economic development over environmental concerns (Berger, 2003). While
this might seem reasonable (a jobs rst strategy) it nevertheless reinforces
the claim that in the more marginal regions there is a preoccupation with
economic growth, to the detriment of any triple bottom line approach.
Significantly, in an era of globalisation, local production sites are integrated
into global markets by supranational agribusiness rms, often deliberately
by-passing the legislative mechanisms established by the nation state and
aimed at protecting the environment (Held et al., 1999). Will the regions
compromise environmental security for the short-term economic benets of
investment? Will regional governance arrangements secure the best future
for the regions? In Australia, for example, the emerging framework of re-
gional governance has emphasised competition over cooperation with
bidding wars occurring as regional bodies seek to capture as much funding
as possible, and within limited federal and State budgets. The beggar thy
neighbour approach that has seen the States out manoeuvring each other
for private and public funding is being imposed at the regional level, raising
the spectre of further unevenness of development as regional options are
pursued (Stilwell, 2000).
The Enthusiasm for Participation is Likely be Quelled by the

Reality of Accountability
We do not need Max Weber to remind us that voluntary structures can

readily transmogrify into bureaucracies and that one of the reasons for this
is the perceived need for accountability. Overlapping layers of participative
regional governance in the context of the structures of representative gov-
ernment are confusing enough. When multi-layered levels of federal and
state agency responsibility and business interactions are also introduced, the
result can be total incomprehensibility. And, on top of this, when the public
funding is injected into the equation, there are often grave fears that the
funds will be either misspent or will disappear without trace.
In some regions there are literally hundreds of separate entities charged
with delivering programmes, often working across a number of regional and
sub-regional boundaries, and having no immediate connection with each
other. Part of the problem has to do with the so-called stove piping of
government activity a Department of Natural Resources, a Department of
Agriculture, a separate Agency for Environmental Protection, another
Department of Regional Development, and so forth where, rather than
serving the interests of the community via regional bodies, they compete for
funding and status within government. The regional bodies often nd it
difcult to wend their way through thickets of legislation, forests of paper-
work and the jungles of competing responsibilities. But, another part of the
problem is that public monies are being delivered to non-democratically
elected regional entities. As Gerry Stoker (1998) has reminded us, the
emergence of self-governing networks creates the problem of accountability.
It is one that is supposedly xed by central agencies creating a complex set
of rules for the procurement and expenditure of funds. However, the out-
come is that the regional organisations begin to behave more like regional
business organisations or local governments, robbing the organisation of
its uid and dynamic character and ultimately containing expenditures to
those activities approved by central bureaucracies. Here, we experience what
Eshuis and Van Woerkum (2003, p. 393) refer to as the vicious circle of
bureaucratic monitoring and distrust. The irony here is that the move to
more participative forms of decision-making activity was motivated, in the
rst place, by the need to escape the more rigid, technical forms of planning
that were seen to be the products of aloof, city-based, government depart-
ments (see Lawrence, 2001).
It has been observed that the desire for much stronger integration through
joined up governance has led to ever-increasing controls by central ad-
ministrations as they scrutinize the priorities and performance of local and
regional agencies (see Cowell & Martin, 2003). This has been the experience
in Australia (Lawrence, 2003) and, it appears, in the US, UK, New Zealand,
Canada and many EU states (such as Sweden and the Netherlands) (see
Geddes, 2003). In other words, centralised managerialism can readily ac-
commodate a rhetoric of local involvement and capacity building making
something of a mockery of community empowerment. Central power can
and does undermine local initiative at the same time as it renders harmless
any attempts to develop alternative policy at the local level (Geddes, 2003).
If stakeholders believe that a decision-making process is awed especially
if they dont trust in their ability to have the outcomes of participative
decision-making endorsed and delivered they will be reluctant to par-
ticipate further and often withdraw their support (Eshuis & Van Woerkum,
2003). They will ultimately be disempowered. As Head and Ryan (2004,
p. 20) have emphasised:
Models based on participative governance emphasise the role of trust and mutual ad-
justment in sustaining policy and delivery networks that are substantially reliant on non-
government actors. The challenges in building such arrangements in the long term are
becoming evident to stakeholders.
It is one thing to accept that the appropriate governing structures for sus-
tainable development will be multi-level and multi-stakeholder (European
Communities, 2003) but quite another to conclude that such structures, or
what results from deliberations within those structures, might have wide-
spread legitimacy. According to Bulkeley et al. (2003) although the EU
supports bottom-up governance to enable people at the grassroot level to
participate in decision-making (and to promote transparency, inclusivity
and accountability), the ideal of participative democracy is compromised by
patterns of power and legacies of past relationships that can obscure proc-
esses and complicate decision making (Bulkeley et al., 2003, p. 250). In fact,
multi-level governance entities can sidestep the political and institutional
structures of the nation state and bring global policies to bear on their local
actions (Bulkeley et al., 2003, p. 251). This may further global governance
but fail to do so in ways that would enhance sustainable development

particularly when the global agenda is one of extending the inuence of free
trade and corporate expansionism (Stiglitz, 2003; McMichael, 2004). We
have to ask: will bottom-up governance ultimately be compromised by a
lack of democratic legitimacy? (Bulkeley et al., 2003).
Finally, partnerships often rely upon a slow accumulation of social trust:
this tends to reduce the ability of groups to undertake action in short time
periods and, indeed, when decisions are made they tend to be about incre-
mental, not radical, change (Westholm, 1999, p. 21).
Rural People are Expected to Act to Save the Planet, but their
Ability to do so is Proscribed by their Liminality
Progress in capitalist agriculture is usually typied by the following: under

demands of competition: farm numbers decline; farm size increases; labour is
replaced by technology; off-farm inputs (machinery, agrichemicals, fertlizers
and capital) are purchased in ever larger volumes; and, farm output burgeons
(Stirling, 2001; Lawrence et al., 2004). Farm output enters the marketplace
where in the context of slowly growing demand it fails to provide the level
of profit needed to sustain the economic base of farming, placing pressure on
farmers to leave the land, increase farm size, purchase more inputs and so
forth. It is not without good reason that this has been termed the treadmill
of production (Schnaiberg, 1980). It is a treadmill that has as one of many
unintended consequences environmental degradation.
Given that much of the degradation of natural resources is a by-product
of productivist agriculture, it would therefore seem appropriate that rural
producers are progressively enrolled in schemes to alter their on-farm ac-
tivities. What must be recognised, however, is that a large proportion of
farmers particularly so-called family farmers are economically mar-
ginalised, failing to obtain sufcient income from agricultural endeavours to
maintain their livelihoods (Barr & Cary, 2000; Almas & Lawrence, 2003).
Many have to pursue off-farm work options to maintain a cash ow. Should
we expect that they would have the funds or time to devote to correcting
environmental degradation, despite the various incentives offered by the
state?
Apart from the farmers, many of those living in rural communities have
been progressively disempowered and detraditionalised under neoliberal
policies that remove the social services and infrastructural platforms that
might enhance community action (see Gray & Lawrence, 2001). And, as
people leave farming and rural regions, the extent of social participation and
level of trust and scale of community activity are all curtailed and threatened
(Pretty, 2002). Self-help and partnership initiatives look to be going only
part-the-way to addressing the mistakes of the past and of the converting
natural resource managers to a new sustainable development trajectory.
It is recognised that globalisation and the accompanying restructuring of
the state have produced major regional disparities (Gleeson, 2003). As Fung
and Wright (2003, p. 33) acknowledge empowered participation may de-
mand unrealistically high levels of popular commitment, especially in con-
temporary climates of civic and popular disengagement.
There is also a very interesting notion that if family farm producers have
limited ability to change, that if supermarkets are becoming more demand-
ing of the products that they put on their shelves, and that if the majority of
agricultural production is really being provided by a very small minority of
producers, that it might be that the future for a more sustainable agriculture
lies in the closer ties of supermarkets to producers, and under the auspices of
informal global regulatory audit cultures such as that of the European
Retailers Working Group (known as EUREP see Campbell, 2004). It is
not fanciful to suggest that the corporate food sector might see market
advantage in sourcing foods and bres from farms adhering to clean-
and-green guidelines, banning genetically modied organisms from the
products they place on their shelves, and imposing very strict sustainability-
related standards on their suppliers. Would this not lead to the intriguing
conclusion that the faster the smaller producers leave agriculture and have
the remainder linked to a progressive supermarket-based system that took
voluntary regulation seriously the more likely we are to achieve sustain-
ability? (see Burch, Lyons, & Lawrence, 2001; Burch & Lawrence, 2004).
HOW THEN ARE WE TO GOVERN SUSTAINABILITY?
The shift from government to governance (Berger, 2003) is that of a move

from a linear, top-down, state-directed system of decision-making to one
of non-hierarchical arrangements involving a complex network of both
state and non-state players (see Bulkeley et al., 2003, p. 237). Citizen en-
gagement strategies of participatory governance are emerging to challenge
the centralised approaches to public administration. What appears to be
occurring is that some of the functions of the state are shifting upwards to
transnational institutions and organisations, downwards to the regions,
and outward to a host of non-state actors (see Bulkeley et al., 2003,
following Pierre & Peters, 2000) as part of the hollowing out of the nation
state (but see, for an alternative view, Deas & Ward, 2000). Yet, this too
gives the impression of a hierarchy of governance when what appears to
have emerged is decision-making within overlapping and interconnected
spheres of authority (Bulkeley et al., 2003, p. 239). Governance in the EU,
for example, is no longer conceived of as the bargaining and negotiation
between nation states but, rather, as the outcome of uid interactions be-
tween multiple spheres (supranational institutions, nation states, transna-
tional networks, sub-national governments, place-based partnerships and
civil society) (Bulkeley et al., 2003). Europes Transnational Municipal
Networks, for example, not only help in the articulation between various
tiers of government but also seek in their own right to govern the
environment. They do so by disseminating knowledge, lobbying govern-
ments and implementing EU policies (Bulkeley et al., 2003). The USs
Habitat Conservation Planning and Australias catchment management
strategies are emblematic of the shift from command-type and fragmented
government to that of collaborative, integrated, regional ecosystem gov-
ernance arrangements where recognition is given of the complexity of en-
vironmental issues and the need to cross traditional, political and
administrative boundaries in an effort to address those issues (Everingham,
Cheshire, & Lawrence, 2003; Karkkainen, 2003).
In Australia, my colleagues and I have identied three periods of regional
governance since the Second World War. The rst was an old-style region-
alism that existed until the 1980s. This was associated with decentralisation,
exogenous development, the industrialisation of agriculture and welfarist
and protectionist policies. A second phase a form of new localism arose
in the mid-1980s and was typied by an emphasis on individual and com-
munity empowerment and action, endogenous development and small gov-
ernment all endorsed and fostered by neoliberalism. What we believe we
are seeing today is something quite different. It is the emergence of the
bioregion as the basic delineation for local decision-making, the develop-
ment of state/community partnerships, the exible coordination of govern-
ment activities, some alteration to (rather than a complete escape from)
productivist agriculture and strategic state investment in regionally based
natural resource management (Everingham et al., 2003). This could be
considered a variant of the new regionalism that has been identied
in Europe (see commentaries by Rainnie, 2002; Rainnie & Grobbelaar,
2005), although we believe it is really closer to what Marsden (2003, p. 4)
considers to be a rural development dynamic that highlights the
re-embedding of food supply chains, a focus on rural livelihoods, an
agro-ecological approach to farm management and rural sustainability as the

goal of development. It is, what is termed in Australia sustainable regional
development a community/government partnership approach that goes
beyond the strict neoliberalist-inspired self-help models of the 1990s. While it
falls short of a radical sustainability that would be marked by bioregionalism
and a shift of power (rather than simply responsibility) to new institutions (see
Gray & Lawrence, 2001, p. 153), it represents a positive move to understand
the complexity and fragility of ecosystems and to stress the necessity of in-
tegrated and multi-level strategies. As Head (2004) has argued, it provides an
opportunity for the differences between stakeholders to be discussed, assessed
and potentially resolved. It appears to be much more ambitious, for example,
than the EUs Eco-management and Audit Scheme that is concerned prima-
rily with governance of the environment (see Heinelt & Smith, 2003). Im-
portantly, sustainable regional development anticipates that the new
partnership arrangements must be supported by a long-term commitment
by governments and by considerable public funding (Lawrence, 2003).
The question could still be raised, however, of the desirability of moving
from known systems of government to untested systems of governance
based upon the deliberations of unelected representatives. As Everingham
et al. (2003, p. 11) have argued, the broadening of the mandate and ac-
countability for such institutions:
allows the long-term perspective necessary for environmental sustain-
ability, thereby overcoming the short-term planning timeframe linked to
3- or 4- year election cycles
provides an opportunity to restore trust between citizens and government
departmentsywith a move beyond rigid one-way forms of public con-
sultation to more diverse, exible and open systems of engagement that
involve a broad spectrum of the regional population and encourage de-
liberative and discursive participation
gives legitimacy to local knowledge and the sharing of values, with local
people not only having a voice in regional planning, but also helping to
shape the process of change.
Social networks are the foundations of society and provide the basis for
more formal arrangements of government (Taylor, 2004). As such, they are
to be nurtured and promoted to harness social capital and to foster social
inclusion (Crow, 2004).
Notwithstanding the potential for a regional renaissance based on triple
bottom line approaches, we should nevertheless recall John Loverings
(2001, p. 350) assessment of the present regional agenda:
Portrayals of (regionalism) or devolution as if they represent the trium-

phant culmination of struggles to empower distinctive regional identities are
at best romantic readingsy(that) obscure the fact that regionalism can also
be a key component of a strategy of state restructuring aimed at realizing a
broadly neo-liberal model of globalization.
To sum up the earlier discussions, there are several pointers to success in
sustainable regional development:
Acknowledgement that regional development is about sustainable devel-

opment and that all plans for development must treat the economy, so-
ciety and environment on an equal footing.
An increased devolution of power (not just responsibility) to regional
entities, with a real recognition of the potential of these groups to make a
difference in terms of long-term natural resource management and social
justice.
Emergence of a structure of governance that ensures that institutional
arrangements are conducive to regional decision-making. Government
agencies must come behind community initiatives to provide technical
support for sustainable development: this will mean a re-organisation of
government activities so that holistic approaches are adopted over single
departmental priorities.
Commitment of sufcient nancial and other resources to regional group-
ings to ensure that on-ground activities are undertaken, monitored and
improved.
Acceptance of a long-term time-line to ensure that the regional arrange-
ments are accepted as legitimate and can survive the election timeframes
of politics.
CONCLUSION
To paraphrase and update Karl Marx, social scientists have been content to
interpret the world when the point, however, is to move it towards a more
sustainable trajectory. What sociological insights can we bring to bear on
this?
In this chapter I have raised a series of questions about the regional
delivery for sustainable development and have argued that while there is
evidence of success, this is not to say that it is challenging the framework of
current (unsustainable) production, or that it is not a contradictory process
at the local level.
What will happen with the regional experiment in sustainability? It has

been initiated at least in part because of: the perceived lack of progress being
made in ghting environmental degradation; the assumption that if local
people own problems they will be more willing to invest time and effort in
their solution; and, recognition that long-term environmental progress
should not be tied to 3- or 4- year cycles of parliament (in which the en-
vironment can be used each time as a political football).
Along with recognition of the failure of the structures and processes as-
sociated with representative government to deal with the complexities of
sustainability, the ve discernable characteristics of regional governance, as
it relates to sustainable development, are:
A so-called bottom-up approach to decision-making, with local com-
munities being encouraged to take ownership of development and natural
resource management problems.
The devolution of responsibility to the regional level. As an element of
this, the desire to empower citizens both to understand the issues and to
act collectively to overcome them that is, to raise their capacity to act for
themselves.
A more responsive bureaucratic response to community plans and needs
particularly whole of government approaches and an alteration to the
organisational culture of stove piped government agencies. The state
becomes an enabler.
Creation of a community-initiated action plan, with clear goals and time-
lines.
A series of (often complex) measures for accountability in the expenditure
of funds, and in the monitoring and evaluation of sustainability appli-
cations (Westholm et al., 1999; Cavaye, 2004).
The real question is: can we trust and should we endorse regional part-
nerships to deliver sustainable development? We know that previous ar-
rangements based upon top-down legislative sanctions have largely failed.
We know that sustainability is a long-term goal that must live beyond both
parliamentary terms and the lives of the current generation of people in
existing communities. We also know that the current arrangements are an
experiment: they are hybrid, fragile, uncertain and contingent.
So, why might we want to endorse the emergence of governance structures
to foster something called sustainable regional development? Without
wanting to be too prescriptive, the answer I will give is pragmatic and
eclectic. There is little else that at this time appears to provide a genuine
option for the future. Should we look to the WTO and other supranational
governance bodies for leadership in sustainable development? The answer

would seem to be no. As Howard Newby (1996, p. 214) reminded us last
decade, most global agencies seeking to govern resources lack legitimacy
and respond slowly and imperfectly to the demands of local people. Might,
then, we trust the global corporate sectors embracing of self-regulation as
the key to sustainability? In some instances yes but in general, certainly no.
There are good reasons, then, to look to support the regional experiment in
sustainable development. It is community based, government supported and
has at its core a framework that represents the interests of community/
government partners in triple bottom line action. Why, though, should we
place any faith in collaborative arrangements to deliver sustainable out-
comes?
We should perhaps recall the words of Christopher Lasch (1995, p. 8) in
his book The Revolt of the Elites and the Betrayal of Democracy when he
argued:
Self-governing communities, not individuals, are the basic units of democratic

Lifey(Their demise)ycalls the future of democracy into question.
In a world of individualisation, detraditionalisation, economic polarisation

and environmental degradation, it would seem that social scientists can play
an important role in understanding the contours of current regional devel-
opment and its potential for strengthening democracy. This does not mean a
blanket endorsement of regional policy but, rather, the careful evaluation of
structures and processes of governance, an understanding of the forces that
foster unsustainable practices and an appreciation of the social, economic
and institutional mechanisms that might move rural regions further along
the path toward sustainable development.
ACKNOWLEDGMENTS
I thank the Australian Research Council for funding several projects that
assisted in the production of this chapter. I also thank my colleagues
Dr. Lynda Cheshire, Dr. Vaughan Higgins and Dr. Stewart Lockie and
post-graduate students Jo-Anne Everingham and Carol Richards for their
input into discussions and into earlier papers that I have drawn upon in
fashioning this chapter.
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STATELESS REGULATION AND
CONSUMER PRESSURE:
HISTORICAL EXPERIENCES OF
TRANSNATIONAL CORPORATE
MONITORING
Gay Seidman
ABSTRACT
Can market-based regulation based on consumer pressure and independ-

ent monitoring serve as the basis for transnational corporation regula-
tion? In an increasingly integrated global economy, many scholars and
policy makers fear that mobile capital may force a race to the bottom;
can independent non-governmental organizations and ethical consumers
provide a counterweight to cost-cutting pressures? This paper compares
three of the best known examples of transnational monitoring the
Sullivan Principles in South Africa, the Rugmark social labeling program
in India, and the Commission for the Verification of Codes of Conducts
monitoring experiences in the apparel industry of Guatemala to consider
some common features of transnational monitoring.
At the turn of the twenty-rst century, a new global social movement was
making itself heard. As the worlds economy became increasingly integrated,

ISSN: 1057-1922/doi:10.1016/S1057-1922(05)11007-5
175
176 GAY SEIDMAN
as global trade patterns revealed themselves in the labels sewn in cotton

t-shirts and in dominant discourses, activists decried the apparently ever-
growing power of transnational corporations. From street protests in Seattle,
to sit-ins in university ofces, to heated discussions about the erosion of na-
tional sovereignty in international institutions, angry voices began to insist that
new patterns of trade and globalization demanded new forms of engagement.
Fueled by factory res in Thailand, by testimonies from under-age work-
ers in Central America, or by toxic chemical spills in India, concerns about
the conditions under which workers in developing countries lived and
worked began to permeate discussions about globalization from the early
1990s. Activists argued that multilateral agencies like the World Trade
Organization and the International Monetary Fund were dominated by
conservative economic policy-makers and corporate leaders, whose concern
for greater profit margins led them to ignore spreading misery. It was time,
they insisted, to develop a new approach: there had to be some way to shape
globalization from below, to avoid the race to the bottom as developing
countries competed for foreign investment.
As concern about global sweatshops to spread beyond small activist net-
works, that new approach began slowly to emerge. Building on examples of
earlier transnational anti-corporate campaigns especially the divestment
campaign against corporations involved in South African apartheid and the
international boycott of Nestles sparked by its promotion of baby formula
in developing countries transnational activists began to see consumers in
North America and Europe as a new site of potential mobilization. Grad-
ually, they hoped, ethical consumers would learn to use their buying power
to punish or reward corporations, and a new kind of market-based activism
would make itself felt at the supermarket and in the shopping mall. It was,
perhaps, the perfect response to market-based globalization: as fair trade
activists quipped, Dont get mad, go shopping.
Business ethicists were quick to join in. Alert consumers, they argued,
could use new access to information through the internet to question the
conditions under which goods were produced even if the goods were
produced thousands of miles away, in far-off continents by workers so des-
perate for a job they could not complain about toxic chemicals, long hours,
or low pay. Globalization and its discontents, ethicists warned, would soon
be a problem for business profitability: consumer concerns about working
conditions and environmental degradation would soon become so important
that they could affect the corporate bottom line. To avoid boycotts and
demonstrations, wise corporations would incorporate codes of conduct and
ethical principles into their basic structure, or risk tarnishing their reputations
Stateless Regulation and Consumer Pressure 177
and reducing their market share (Sethi & Steidlmeier, with contributions by
Paul & Shrivastava, 1991; Williams, 2000; Waddock, 2002).
Activists and ethicists could point to some real evidence to support
the market-based approach. Ethical trading schemes claimed real impact:
individual consumers responded to widespread reports of global exploitation
by creating an ever-growing market for fair-trade products. In Europe,
ethical trading initiatives in food and clothing grew by some 40% annually
between 1997 and 2004 (Vidal, 2004). In the United States, telephone surveys
found that consumers cared about the conditions under which products were
made, and said they would willingly pay more for goods produced under
ethical rules (University of Maryland, 2000). In an experiment attempting to
test American consumers behavior, a slight majority of customers at a
Michigan department store paid more for socks carrying labels claiming that
the socks were produced under good working conditions. True, no consumer
questioned the labels claims (which were in fact entirely ctitious), but the
experiment suggested that when a choice was offered, consumers might take
the ethical route at least as long as the price difference remained relatively
small (Prasad, Kimeldorf, Meyer, & Robinson, 2004).
Why have global activists turned to visions of labeling and independent
monitoring as a new approach to global regulation, especially for work-
places? What are their underlying assumptions about the character of global
activism, about the nature of sweatshop production, and the limits of state
regulation in a neoliberal era? More importantly, perhaps, what are pro-
ponents assumptions about stateless regulation and social activism, and
how do they see these schemes emerging and persisting? Following is a brief
discussion of the general approach. I briefly describe three examples, widely
cited in the literature as successful examples of transnational corporate
monitoring. Then, in comparing the similarities and differences across the
three cases, I look for patterns in the way these schemes were constructed
and implemented, in order to get a better sense of the possibilities and limits
embodied in this approach.
TRANSNATIONAL PRESSURE AND

LABOR MONITORING
As countless analysts have noted, through the late twentieth century,
transnational corporations expanded beyond the reach of national govern-
ments or even international agencies, undermining national sovereignty and
local identities as they aggressively spread investments around the world
178 GAY SEIDMAN
(Greider, 1997). Over the past 40 years, new technologies and new produc-
tion strategies have spread industrial production across the globe, often
coordinated by large multinational corporations. At the same time, the idea
that international trade will serve as the motor of economic growth
everywhere has become increasingly accepted by academic economists and
policy-makers alike, an apparently seamless consensus backed by the power
of international nancial institutions (Stiglitz, 2002). Combined, these
trends the globalization of industrial production, and the context of in-
creasingly unfettered international trade prompted a search for new ways
to regulate workplace conditions.
As global trade expanded apace, activists, journalists, and academics
suggested that mobilized consumer pressures offered new possibilities for
persuading corporations to respect workers rights. As the world seems
increasingly dominated by a global assembly line linking together both
producers and consumers around the world, many analysts suggest that a
global social movement based in civil society what Naomi Klein (2002)
calls a bad mood rising could use networks of information, purchasing
power, and cultural pressure to challenge corporate control.
Of course, proponents generally acknowledge important limits to the
strategy, both in terms of target goods, and in terms of consumer audiences.
Appropriate targets for transnational boycotts are limited: most goods
including most goods produced in rural areas are never exported, and thus
are not subject to transnational campaigns, no matter how bad the condition
in which they are produced. Further, consumer pressure tends to be most
effective when applied to well-known logos, easily identiable products, or
goods produced in specific countries; most goods produced in any export-
processing zones are not identiable, and thus not vulnerable to transnational
boycotts. Finally, even ethical consumers will balk at boycotts involving
goods they consider necessities; it is much easier to persuade consumers to
support a boycott if the goods involved are luxuries, or for which there are
easy substitutes, than to ask for consumers to engage in real sacrice.
Successful boycotts appeal to very specific consumers. Ethical consumers
form only a small portion of global markets, primarily located in advanced
industrial countries and generally concentrated among university students
and others with enough disposable time to observe boycotts, and enough
disposable income to choose products by ethics rather than by price
and quality. Most consumers pay little attention to ethical appeals:
Dana Franks (1999) lively history of buy American campaigns suggests
that consumers are not always as responsive as activists might wish.
And, of course, as developing country unionists have repeatedly warned,
transnational consumer boycotts carry the risk that the wealthy consumers
of North America and Europe, rather than workers in developing countries,
make key decisions about which labor rights matter, and which factories will
be targeted and while wealthy consumers lose nothing if a company goes
bankrupt, workers risk losing their jobs (cf. Ali, 1996).
Nevertheless, to optimistic observers, the new social activism offered hope
for restructuring global politics: through transnational networks of mobi-
lized consumers, attentive to ethical violations and insistent on global eq-
uity, perhaps it would be possible to name and shame corporate violators,
to punish companies who exploited workers and communities in far-ung
parts of the world, to use consumer pressure, shareholder resolutions, and
international boycotts to police and regulate the transnational corporations
which seem so fundamental to globalization. By the late 1990s, social
movement theorists began to ask whether transnational social movements
represent a new kind of activism: has globalization spawned transnational
social movements of a qualitatively different kind than the social move-
ments that came in an earlier, more nation-centered era (Della Porta, Kriesi,
& Rucht, 1999; Guidry, Kennedy, & Zald, 2000; Khagram, Riker, &
Sikkink, 2002; Smith & Johnston, 2002). Arguing that consumer pressure
would push corporations to adopt new codes of conduct, it became in-
creasingly common for scholars to suggest that activists should promote
a transnational framework of corporate monitoring, using transparency
and publicity to develop new approaches to global corporate conduct
(Fung, ORourke, & Sabel, 2001; Ruggie, 2003; Ayres & Braithwaite, 1992;
Braithwaite & Drahos, 2000).
Building on the Human Rights Example
Whether or not its proponents recognize it, this vision of transnational

activism generally builds on the example of the international human rights
movement of the last quarter century. In the discursive redefinition of labor
rights as human rights, rather than citizenship rights, however, activists have
subtly reoriented their appeal, and redened their targets. Historically, na-
tional labor campaigns have mobilized local constituencies to demand that
national states enforce citizenship rights; by contrast, transnational labor
advocates work on a broader canvas. Local activists provide information
about working conditions or environmental degradation to transnational
activists; that transnational network uses information to mobilize audiences
across international boundaries, hoping to put pressure on perpetrators and
persuade them to change their practices.
180 GAY SEIDMAN
But whereas the human rights movement sought to mobilize international

opinion against the behavior of states, hoping to change the behavior of
local states toward their own citizens, the transnational labor movement
seeks primarily to mobilize international pressure against corporations and
manufacturers, by appealing to consumers a shift that is more problematic
than activists frequently recognize. The ease of this discursive transforma-
tion from targeting states, to targeting multinational corporations
obscures the tensions contained with it, between claims articulated in terms
of citizenship, and claims articulated in terms of universal human rights
and morality. The philosophical underpinnings of citizenship rights and
human rights have very different histories, and different epistemologies: as
Shar (2004) cogently argues, citizenship reects participation in bounded
communities, while human rights discussions evoke a universal human ex-
perience, reecting transcultural, transnational commonalities. Long before
the emergence of the modern notion of the nation-state, Shar notes,
citizens addressed their claims to, and expected policies to be implemented
by, local states even if that state might be an undemocratic one.
By contrast, the human rights perspective invokes a set of universal rights
based on common human needs and concerns; claims-making occurs not
within the framework of domestic law, but through appeals to fundamental,
universal human rights within a universal community, especially since the
United Nations adopted the international charter of human rights in 1948.
Although labor rights are sometimes discussed in similarly universalistic
terms for example, when the history of the global anti-slavery movement is
linked to the rise of labor unions (Braithwaite & Drahos, 2000) most
discussions of labor rights focus more explicitly on the role of domestic
activism, states, and domestic legal frameworks, with far less reference to
a changing and evolving international consensus. Labor rights, as a key
component of citizenship rights, have been viewed as rights that have been
won through struggle: they vary in different contexts, depending on locally
specific histories. By contrast, human rights are generally discussed in more
universalistic terms, and human rights discourse tends to explicitly reject
local variation just as global codes of corporate conduct are framed by
universalistic concerns, blurring local distinctions.
Targeting Corporations and Consumers
But even aside from this epistemological shift, a consumer-based approach

also involves a shift in mechanisms: transnational consumer pressure, rather
than state regulation, becomes central to discussions of corporate compli-

ance. How might consumer pressure be built into a system of global
corporate regulation? Most proposals for alternative ways to control global
sweatshops and environmental degradation remain sketchy, but they share
some key features. In general, they replace a state-centered vision of work-
place regulation with international codes of corporate conduct, monitored by
private agencies and enforced by engaged consumers. As privatized, volun-
tary commitments, codes of conduct represent promises on the part of major
corporations that they will seek to avoid egregious violations while they shift
production to parts of the world where governments are too weak or too
dependent to enforce labor codes or environmental standards. Conceptual-
ized in terms roughly parallel to the international human rights movement,
business ethicists suggest that alert consumers will force corporations to
improve the conditions under which their goods are produced, using codes
described by one ethicist as an idea whose time has come (Williams, 2000)
as a benchmark against which corporate behavior will be judged.
To all these proposals, the threat of consumer pressure is key. Discussions
of corporate codes of conduct generally assume that socially irresponsible
behavior will carry real costs: Companies which behave ethically will be
rewarded by discriminating consumers, while corporations guilty of pro-
ducing goods in sweatshop conditions will be exposed, shamed, and boy-
cotted (Sethi et al., 1991; Waddock, 2002; Williams, 2000; Fung et al., 2001).
Although this pressure is often exaggerated, there is an increasingly vocal
discussion about how to involve multinational corporations in monitoring
themselves essentially, invoking widespread management practices of
benchmarking, continuous assessment, and self-study in efforts to raise
workplace standards.
Much as activists and ethicists predicted, the movement to mobilize
transnational consumer pressure began to have real impact within only a
few years, after a few highly successful campaigns targeting high-prole
corporations Gap, Nike, and Starbucks among them seemed to get
results in the mid-1990s. For corporations, the rst response was frequently
to adopt a code of conduct, promising to make sure the goods they sold in
Europe and North America were produced under conditions that were
environmentally sound and which did not harm workers. Drafting codes of
conduct became an art in itself: by 2001, literally scores of corporate codes
of conduct had been published, by individual corporations, by groups of
corporations collaborating on setting standards for desirable behavior, and
by multilateral organizations like the United Nations Center on Transna-
tionals (Bulletin of Comparative Labor Relations 37, 2000).
182 GAY SEIDMAN
On their own, corporate codes of conduct are unlikely to improve

working conditions: as most observers note, simply publishing a code for
consumers to read in North America hardly guarantees that corporations
will enforce their own standards, much less that they will ensure that their
sub-contractors producing in far-ung factories in developing countries,
where weak states and corrupt labor inspectors have little interest in en-
forcing private codes of conduct will meet the headquarters standards. All
too often, corporate codes of conduct boil down to a public relations
exercise, a lunch, a launch and a logo (Bloweld, 1999). The fact that a
corporation has printed up a code of conduct does not, in fact, offer any real
assurance to consumers that goods are produced under safe working con-
ditions, without polluting the local environment, or that the workers who
made them were paid even the legal minimum wage, offered any kind of
protection from harassment or discrimination, or allowed any rights to free
association. Without any systematic process of monitoring, even the most
ethical consumer is left choosing between labels, with little hope that those
labels reect real efforts to improve working or environmental conditions
around their factories. When Oxfam launched a campaign to promote eth-
ical consumption in 2004, it warned consumers that labels could not be
considered accurate indicators of corporate behavior; nevertheless, Oxfam
advised, consumers should seek out fair-trade labeled goods, to send a loud
signal to retailers that consumers care and are willing to pay for decent labor
standards (Oxfam, 2004, p. 89).
To be effective, the naming and shaming strategy requires some external
system of monitoring corporate conduct. Internal company monitoring
processes are not enough: the pressures to reduce labor costs, and the sense
that violations tend to occur far from the nal point of sale, tempt even
companies known for their civic commitment, and few internal monitors can
withstand the pressures of the bottom line. Many companies employed ei-
ther internal monitors or accountants hardly known for their expertise in
identifying safety hazards at work to police working conditions, but nei-
ther approach was likely to ensure great improvements (ORourke, 2000).
As one observer noted, Policing of the codes has often been a travestyy
Usually the codes are intended to improve public relations rather than in-
dustrial relations. (Wells, 1999, p. 500). Given competitive pressures in the
global marketplace, most corporate executives perhaps especially those
who rely on sub-contractors to produce elements of their products in export-
processing zones around the world are probably more concerned about
price and quality than about working conditions. Without external mon-
itoring, codes may reect a vision of corporate goals, but they carry no
reliable promise that anyone outside the public relations ofce is paying any
attention (Compa, 2001; Compa & Darricarrere, 1996; Posner & Nolan,
2003).
As codes of conduct proliferated, then, so have calls for independent
monitoring. Activists increasingly suggest that companies should open their
doors to outside observers, allowing outside inspectors into the factory. To
ensure that corporations live up to their published codes of conduct, ac-
tivists, ethicists, and business leaders regularly argue that companies should
submit their factories to outside inspectors, who could alert concerned con-
sumers to any violation or, conversely, could guarantee to consumers that
the products were produced under conditions that met the codes require-
ment. Instead of asking consumers to accept corporate promises on good
faith alone, activists argue that corporations should admit independent
monitors into their factories and those of their sub-contractors; these out-
side monitors could then guarantee to head ofces and consumers alike that
goods had been produced under acceptable conditions (Compa, 2001;
Gould, 2003; Rodriguez-Garavito, 2003).
Independent Monitoring
Independent monitoring emerged in the late 1990s as the gold standard of

the transnational corporate conduct debate: if corporations were willing to
submit to outside monitoring, they would be permitting the kind of infor-
mation-gathering that would enable consumers and activists to implement
naming and shaming mechanisms of global control. While debates persist
over who should monitor companies, and how, there is increasing consensus
in policy-making circles that a new form of private voluntary initiative holds
real promise as a way to hold corporations accountable for the conditions of
workers around the world (Geref, Garcia-Johnson, & Sasser, 2001;
Ottaway, 2001; Schrage, 2004).
Indeed, several distinguished scholars go so far as to suggest that cor-
porate codes and monitoring schemes might provide a foundation for larger
global regulatory schemes. Recognizing that individual company codes are
neither public enough nor extensive enough to improve global working
conditions, proponents of soft regulation often argue that managements
and international agencies together could develop larger codes and
monitoring frameworks replacing national labor laws with a cooperative
transnational effort to prevent a race to the bottom (Fung et al., 2001;
Ruggie, 2003).
184 GAY SEIDMAN
With few exceptions, however, discussions of such private, voluntary

systems of regulation remained abstract and general: neither activists nor
policy-makers tend to look carefully at actually existing independent mon-
itoring schemes. Instead, they refer to historical or existing cases in passing,
rarely going into detail or acknowledging important differences between
global campaigns, even as they argue that consumer pressure worked to
change corporate behaviors. Thus, the Sullivan Principles governing
American companies in South Africa under apartheid were likely to be
mentioned in the same breath as the global boycott against Nestles for its
advertising practices, or a more recent campaign linking Nikes athletic
footwear to sweatshops and labor violations. Similarly, there has been little
effort to tease out the conditions under which monitoring had worked, the
kinds of industries and issues that seemed likely to mobilize broad consumer
support, or the different approaches embodied in existing monitoring
arrangements. Even discussions of more recent efforts tended to blur im-
portant distinctions: a campaign to promote fair-trade coffee, grown by
smallholders using environmentally sound practices, is often discussed in the
same breath as Rugmark, a social label approach designed to eliminate child
labor in Indias hand-woven carpet industry.
Discussions of monitoring display an unfortunate tendency to overlook
failure. Whenever journalists or researchers have suggested that specific
cases of monitoring had proved less than successful, activists and policy-
makers tend to drop them from their repertoire, continuing to list only those
cases where independent monitoring and consumer pressure seemed to have
been successful in changing corporate behavior. Thus, for example, early
discussions of consumer pressure frequently cited the efforts by the British-
based Body Shop to involve indigenous people of the Amazon in collecting
environmentally sustainable ingredients in their products; but when jour-
nalists published more critical accounts, those references disappeared from
activist and academic discussions alike, apparently dropped in favor of more
positive or less problematic examples.
In the remainder of this paper, I hope to avoid that trap, by comparing three
of the most frequently cited examples of successful independent transnational
monitoring in an effort to explore some basic questions about transnational
monitoring without ignoring its limitations. I focus on three well-known cases,
each involving a slightly different approach to monitoring and labor condi-
tions. In each case the Sullivan Principles in South Africa, the Rugmark
social labeling system in India, and the Commission for the Verication of
Codes of Conducts (COVERCO) monitoring of the apparel industry in
Guatemala I examine the underlying dynamics of a transnational movement
as well as the independent monitoring framework. Under what circumstances

have transnational social movements emerged around labor conditions? What
is the role of local activists in initiating exposes of labor conditions, and under
what circumstances have transnational audiences responded? To what kinds of
appeals do transnational consumers respond, and what kinds of products are
involved? What role is played by local states, and how do export markets
feature in the rise of independent markets? What can we learn from a com-
parison of existing schemes, and what are the implications of these lessons for
a broader understanding of transnational movements and labor activism? By
considering constraints as well as promise, failures as well as success, I hope to
develop a more balanced sense of the promises and pitfalls involved in soft
regulation and voluntary codes of corporate conduct, and perhaps a sense of
what kinds of policies and processes have worked for transnational labor
regulation.
THE SULLIVAN PRINCIPLES
Perhaps the most frequently cited of all efforts to monitor multinationals,

the Sullivan Principles in South Africa represents an important historical
antecedent to corporate codes of conduct; I argue that it may have altered
corporate culture in important ways, changing discussions around corporate
responsibility, but its impact on actual conditions was remarkably limited.
Between 1977 and 1994, American companies with investments in South
Africa submitted to outside monitoring, and today, proponents of such
schemes frequently invoke this system as one of the early examples of cor-
porate self-regulation. Although the anti-apartheid campaign is obviously
distinct from most transnational labor movements, its focus on corporate
involvement in the apartheid economy included close scrutiny of workplace
issues and discussions of how to promote good corporate citizenship to
such an extent that the Sullivan system is frequently credited with changing
corporate culture, both in South Africa and on the wider global scene
(Massie, 1997; Sethi & Williams, 2000). While it is an unusual case, it is an
important one: the effort to monitor and transform corporate behavior in
South Africa helped shape subsequent discussions about corporate codes
of conduct, and the experience illustrates the dynamics through which
monitoring schemes are created. It can be argued, I think, that the Sullivan
framework is the closest experience we have with full-scale transnational
monitoring, and so it is worth exploring in some detail.
186 GAY SEIDMAN
What, precisely, was the Sullivan system? From the early 1970s, institu-
tional shareholders in the United States demanded that American compa-
nies leave South Africa rather than comply with apartheid legislation; in
response, American companies with South African holdings submitted to a
voluntary code of conduct, and were subject to independent monitoring.
Managers faced real consequences for failing to comply with the code, often
including salary penalties and bonuses linked to their Sullivan rating; fur-
ther, as proponents of soft regulation note, the code was regularly ratch-
eted up, shifting from an initial focus on workplace integration, to
gradually requiring companies donate to local community groups, challenge
government repression, and nally, support political change. The Sullivan
signatories included a wide range of products, from pharmaceuticals to
automobiles, computers to agro-industry; the code was applied in a rela-
tively accessible site, where information about corporate behavior was
relatively available (Spence, 1998).
Perhaps, Sullivans main contribution was in changing corporate dis-
course about social responsibility. Before Rev. Leon Sullivan introduced his
principles, corporate leaders regularly rejected the idea that they could or
should use their economic clout to push for reform, in South Africa or
anywhere else. Corporate discourse emphasized profits as the only business
of business, and rejected the very idea that corporations had social respon-
sibilities beyond the balance sheet. Through its growth spurt of the mid-
1960s, South Africa proved irresistible to foreign investors; by 1972, nearly
300 American corporations had established subsidiaries or afliates there,
with a combined investment totaling over $900 million (Blashill, 1972, p. 42;
see also Sampson, 1987). By the time the Sullivan system had been in place
for a decade, however, South African business leaders were willing to accept
some degree of social responsibility and they regularly pointed to com-
pliance with the Sullivan Principles as an indication of their efforts to take
that responsibility seriously (Relly, 1986).
It is also widely acknowledged that no corporate leaders would have agreed
to Sullivans principles, much less submit to independent monitoring, without
pressure from the larger anti-apartheid movement. Protestors sought com-
plete withdrawal from South Africa, insisting that companies that complied
with South African segregationist laws and paid South African taxes were
supporting apartheid (Danaher, 1984; Schmidt, 1980); even Sullivan himself
acknowledged that companies acceded to monitoring in order to avert more
significant pressure from U.S. institutions (Seidman, 2003). Schoenberger
(2000, p. 28) concludes, The effectiveness of the campaign was based on
Milton Friedmans classic model of corporate responsibility, whereby external
pressures on a corporation dene its societal obligations, not the moral in-
stincts arising from within. The solution in South Africa was achieved not by
voluntary self-regulation, but by bashing heads.
But what do we learn from Sullivans monitoring system? The Sullivan
framework represents the rst large-scale experiment in independent
monitoring of multinationals, and it also set the pattern: Sullivan turned to
Arthur D. Little, an accounting rm with no prior monitoring experience, for
independent monitoring. But as anti-apartheid activists and business ethicists
noted in the early 1980s, ADL did no research of its own on signatories
behavior, nor did it evaluate companies claims. Although ADL required sig-
natories to conrm some data, like payroll information, with companies local
auditors, most of the responses went directly from local South African man-
agers to ADL, with no outside check on companies claims. Items that might
have helped investors or monitors evaluate claims about increasing black em-
ployment data such as the number of job openings, total number of trainees
positions, and total number of black employees were entirely self-reported.
In fact, compliance with only one of the principles expenditure on corporate
contributions to local community projects, such as schools or clinics was
evaluated entirely through veried data (Paul, 1987).
Accountants, of course, are hardly trained to evaluate community
programs, but the history of Sullivans code and ADLs monitoring sug-
gests a prior issue that continues to plague corporate codes of conduct
today: who wrote the code, with what questions in mind? The questionnaires
were drawn up by American accountants, and throughout entire life of
the Sullivan system, they blurred categories that did not translate well
from South Africa to the United States. Thus, for example, ADL charts
describing signatories behavior consistently left undened the corporate
understanding of black employees a category that in South Africa
can mean either African workers alone, or African, Asian, and Indian
(Massie, 1997) creating a remarkable vagueness in discussions of hiring
practicesin Sullivan signatories, in a context where apartheids educational
segregation and the racial stereotypes embedded in South African racial
ideology means that these three groups have faced very different forms of
discrimination at work. This vagueness serves as an acute reminder of the
pitfalls involved in designing codes that will appeal to American and
European consumers and investors, while still addressing local problems: if
the monitors could not measure racial integration in South Africa, what
happens when monitors try to evaluate compliance with a single global
code, designed for use across many different contexts, in places as different
as Sri Lanka, Guatemala, or Lesotho?
188 GAY SEIDMAN
RUGMARK
Like the Sullivan code, Rugmark an effort to use social labeling to elim-
inate child labor in the Indian carpet industry in the 1990s was initiated
as a corporate response to activist concerns. Since its founding in 1994,
Rugmark has been viewed internationally as a remarkable experiment. In
response to international pressure, Indian carpet exporters agreed to submit
to independent monitoring, earning the right to attach a child-labor-free
label to carpets in return. Local non-governmental organizations linked to
transnational networks of activists support a team of monitors and inspec-
tors, who regularly monitor registered looms, removing children when they
are found and punishing weavers who have employed them (Harvey, 1996;
Gay, 1998). A decade after its creation, Rugmark was one of the most
widely cited cases of transnational consumer pressure, considered as an
international success story both for its impact on debates around child labor
in India, and for the example it offers for labeling and independent mon-
itoring (Chowdhury & Beekman, 2001; Hilowitz, 1998; ILO, 2004; Voll,
1999).
At home in India, however, Rugmarks approach is more controversial:
by the time the program was several years old, many of the activists and
organizations originally associated with the program, including UNICEF,
distanced themselves from its creation, insisting that their involvement with
the program at its inception had been experimental, tangential, or over-
stated (Pinto interview, 2003; Agnivesh interview, 2003). UNICEF had of-
cially, if quietly, ended its rather limited involvement with Rugmark by
2003. But while many Indian child labor activists had become far more
skeptical about the project in some cases, going so far as to denounce it as
a misleading, misguided effort (Agnivesh, 1999a) Rugmark continued to
stand as an international example of a model voluntary labeling scheme, in
which good weavers who eliminated child labor and submitted to mon-
itoring by independent outsiders, would be rewarded by gaining privileged
access to international consumers.
What prompted the use of social labels in the Indian carpet industry, and
to what extent have these labels contributed to a decline in the use of child
labor? The focus on child labor in the carpet industry came about almost by
accident, when social activists trying to publicize the persistence of bonded
labor relations in rural India in the early 1980s conducted several highly
publicized raids on carpet sheds in the MirzapurVaranasi region, where
they found kidnapped children as well as bonded adults. In one dramatic
press conference in 1984, activists introduced a group of recently freed

children who described their experiences in what the Times of India termed
the torture camp of Mirzapur: children aged 512 had been kidnapped
from a village in Bihar and sold to a weaver in Uttar Pradesh, living under
medieval conditions until their rescue. Ill-fed, beaten, and mistreated, they
showed journalists the small burn marks all over their bodies, where their
employer had prodded them with red-hot pokers if they fell asleep during
16-hour days at the loom (Agnivesh, 1999b, p. 148; Whittaker, 1988, p. 5).
Rugmark emerged as a transnational response to stories such as these.
Inspired by local activists, promoted by trade union and church groups in
Germany, and supported by ethical importers in Europe and the United
States, Rugmark appears to offer a perfect example of transnational labor
monitoring. An activist movement linking social activists in India
with conscientious consumers abroad, Rugmark was designed to deploy
international consumer pressure to change labor practices in an export-
oriented industry. In the absence of Indian enforcement of its own laws,
Rugmarks independent monitoring offers a widely lauded example of vol-
untary corporate self-regulation, an example of how labels might be de-
ployed to improve conditions in far-ung parts of the world, where alert
consumers can use the label to identify goods produced under acceptable
conditions.
Obviously, not all goods are equally appropriate for social labeling.
Labeling works best when consumers sympathize with the ethical frame-
work indicated in the label when the label refers to a widely accepted
human rights concern, rather than to more contested concerns. It works best
for goods that are identiable and distinct; thus, for example, it is far easier
to label carpets which go intact to the consumer than it might be to label
ball-bearings, which are rarely sold directly to consumers. And labeling may
work best when it covers luxury goods, for which demand is very elastic,
than when labels are attached to goods that are considered necessities; labels
may be much more effective for products for which consumers have many
choices, such as oor coverings, than for products that are more basic, and
less substitutable. Finally, labeling implies that private regulation is required
to supplement ordinary state inspections, suggesting that participants in the
labeling process are meeting a higher standard than would normally be the
case with goods produced in a specific region or country; labels automat-
ically invoke some sense of monitoring, appealing to consumers partly
through a suggestion that the label is applied in good faith, reecting a
sincere effort to ensure that the ethical conditions claimed in the label,
represent reality (Hilowitz, 1998).
190 GAY SEIDMAN
Rugmark is usually described as the outcome of a joint effort by Indian

activists, international organizations like UNICEF, and German church and
trade union activists seeking to help reduce child labor, but in fact, the
program emerged as an initiative of the Indo-German Export Promotion
Project, a program begun in 1988 as a joint GermanIndian development,
run through the German embassy and funded by the German government, to
increase Indian export earnings, mainly from Germany and other countries
of the European Union. Dietrich Kebschull (1999, p. 189) who still served
as IGEP director 10 years later wrote that Rugmark was created in re-
sponse to otherwise well-meaning idealists, who proposed to boycott
carpet supplies from India, since only then, according to them, could the
roots of child labor be removed. It was Indian carpet manufacturers, he
claims, who suggested a social label as a way to protect the thousands of
workers and their families in the Indian carpet belt who relied on export
sales for their livelihood from the threat of an international boycott: as early
as 1990, he writes, manufacturers asked his program to help develop a cer-
tication system as a way to protect access to international markets for their
carpets. Over the next 2 years, together with representatives from interna-
tional organizations, social activists, and inputs from large department stores
in Germany, Kebschulls IGEP developed a program designed to address
international consumer concerns about child labor in the Indian carpet belt.
From the outset, both carpet manufacturers and the German government
alike apparently insisted that the program would be self-regulating and -
nanced by carpet exporters, rather than state-nanced or controlled. Kebschull
(1999, p. 204) writes, the Government of Germany [has] repeatedly empha-
sized that it prefers this type of private and voluntary certication and self-
effort vis-a-vis the alternative of strict and rigid government regulations.
Using the social label instead of a policing regime of nes and other punitive
measures, Rugmark was designed to be market-driven in such a way that
members who still worked with child labor would no longer be able to sell
their products abroad (Kebschull, 1999, p. 195). Facing the threat of inter-
national consumer boycotts, it was hoped, Indian carpet weavers own self-
interest would lead them to eliminate child labor, in the effort to gain the
smiley-face label for the carpets they planned to export.
By the end of its rst decade, Rugmark had developed a straightforward
monitoring system (interviews, Kebschull & Subramaniam, Delhi, 2003), in-
corporating most key principles described in discussions of independent
monitoring. A local non-governmental organization, associated with a well-
known Indian activist, Kailash Satyarthi, employed about a dozen full-time
monitors, divided up into changing teams of two. Every weekday morning,
each pair of monitors would receive a list of seven or eight looms they were to
visit that day; monitors were never supposed to know in advance which
looms they would see. Each team traveled in a separate vehicle, visiting looms
that are often 30 or 60 km apart. If they found any children under 14 seated
at registered looms, they checked whether the child was a relative of the
weaver; Rugmarks rules allow family members to work on weaving, so long
as the child is over years of age and is attending some hours of school. If the
child was not a relative, the inspectors would take the child with them,
usually to the Rugmark Foundations school in Jagaspur. Weavers, mean-
while, would be warned, and repeated violations would result in non-
registration. By late 2003, Rugmark India claimed to have registered 30,000
looms, carried out more than 180,000 inspections, found 800 looms employed
nearly 1,500 children, and taken 166 children to its rehabilitation program. It
was impossible to nd information on how many weavers had actually been
sanctioned (http://www.rugmarkindia.org/about/facts.htm,9/21/04).
In practice, however, Rugmarks monitoring scheme was far less effective
than this tidy scheme suggests. Child labor activists have argued for over a
century that putting out systems like that common in the Indian rug
manufacturing industry are almost impossible to monitor: household pro-
duction is too dispersed, and children too easily available to help out with
work that is done at home, to make monitoring child labor in homework
easy and those difculties are multiplied in Indias carpet-belt. In contrast
to the effort to eradicate child labor in soccerball production where well-
known multinationals worked with UNICEF to move all production into
central warehouse, permitting easy monitoring of child workers Rugmark
sought to monitor children in villages separated by dozens of kilometers of
dirt road, in home-based workshops that were adjacent to weavers own
houses. Although Rugmarks ofcers claimed that each registered loom
would be inspected three times a year, the numbers suggested that the true
gure is probably closer to once every 3 years. Even if inspections occurred
more frequently, critics pointed to the physical characteristics of the village-
based weaving workshops, arguing that in the time it takes monitors to walk
from the well-marked Rugmark vehicles to the loom sheds, any children
working on the looms have had plenty of time to vanish or to polish up
their claims to be family members. Exporters acknowledged in interviews
(Agra, 2003) that looms were registered with Rugmark only during periods
when the rugs they were weaving were specifically destined for Germany
the only consumer market where retailers had pledged to sell mainly
Rugmark-labeled carpets (see also http://www.rugmarkindia.org/about/his-
tory.htm). Ten years after Rugmark was created, the number of monitoring
192 GAY SEIDMAN
teams had been reduced, and UNICEF had withdrawn its afliation to the
program (Pinto, interview, 2003).
In late 2002, a careful study of child labor in the Indian carpet industry
suggested that although non-family child labor had diminished slightly
in the Indian carpet industry overall, child labor by family members per-
sisted, perhaps even more among Rugmark afliates than among other
weavers (Sharman, 2002). While the debate over the carpet industry had
certainly attracted attention to the problem of child labor, and prompted the
governments export promotion council to design and publicize its own code
of conduct for the carpet industry albeit with no apparent effort to in-
corporate any element of independent monitoring Rugmarks most direct
impact was on the discourse around child labor in the carpet industry:
perhaps in stimulating a profusion of labels, it prompted a new awareness
among consumers of the problem, and raised exporters sense that they
needed to address the issue in the workshops involved.
GUATEMALAS COVERCO
Monitoring has a very specific history in Guatemala, linked to its long
history of civil war and repression. In the mid-1990s, the former author-
itarian government and a severely repressed guerrilla movement moved
slowly, under enormous international pressure, into a democratic opening,
overseen by a specially created United Nations mission, MINUGUA. In
the context of the slow move toward peace, non-governmental organiza-
tions, especially human rights organizations, played a key role: through the
long and bloody civil war of the 1980s, human rights and labor groups had
borne witness of repeated massacres and violations of human rights, and in
the peace process of the 1990s, these groups became monitors of the gradual
disarmament of warring militias (Jonas, 1991, 2000). Following what Keck
and Sikkink (1998) describe as a boomerang approach, these human rights
groups appealed to international audiences, hoping to bring international
pressure to bear on a Guatemalan state that seemed unwilling, or unable, to
respond directly to its own citizens.
For many of these activists, Guatemalas transition from civil war to peace
made visible a new set of violations: just as peace began to break out in
Guatemala, new export-processing zones had sprung up around Guatemala
City, often employing young women in conditions that gave meaning to the
term sweatshop. As the export processing zones expanded, issues of human
rights clearly blurred with labor rights: poor young women, bent over lines of
sewing machines for long hours in dimly lit, badly ventilated rooms, had little
more reason to hope that the Guatemalan government would enforce its own
labor code, than indigenous Guatemalan villagers had been able to expect
protection from right-wing paramilitaries during the civil war. Labor union-
ists in Guatemala had long been targets of brutal paramilitary death squads
(Goldston, 1989; Perez & Pablo, 1999); now, human rights activists and labor
activists joined together to bring international attention to the market-driven
violations of the apparel factories.
But it is important to recognize that this shift in Guatemala-based
activism meshed with a larger international campaign. If the global spread
of apparel industry has been central to recent critiques of globalization, it
has also been central to discussions of private, voluntary regulatory efforts
to improve working conditions through codes of conduct and consumer
pressure. Through the 1990s and early 2000s, the apparel industry has been
at the center of transnational labor activism, involving labor activists, cor-
porate ethics campaigns, and consumer boycotts: it is central to transna-
tional networks efforts, the site where poor working conditions, corporate
image, and independent monitoring schemes have come together.
This is not an entirely stateless process, however. American state policy,
as many analysts have noted, has been key in shaping both global industry
and global activism. While new innovations in communications and tech-
nologies certainly made global out-sourcing strategies possible, specific
decisions about siting were shaped as much by American trade policies as by
new technological openings. In the early 1980s, Nike provided an example
of a new managerial approach, focusing on design and marketing rather
than production (Korzeniewicz, 1994). Imitating Nike, many brands moved
further and further from producing clothes in their own factories inside the
United States; instead, they contracted with producers in low-wage regions
to sew clothes according to the brands specications, leaving the brand free
to concentrate on advertising and retail (Klein, 2002). Careful studies of the
industry, however, repeatedly demonstrate that this shift reects managerial
attention to American trade policy, even more than: by the mid-1980s,
companies had learned that they could avoid import duties by skillfully
manipulating the American system of allocating apparel production quotas
to different developing countries. Instead of ghting to sustain protectionist
legislation, some managers became adept at locating sub-contracted pro-
duction in countries with unused quota, so that they could import their
products back to the United States without facing tariff penalties (Collins,
2003; Geref, Spener, & Bair, 2002; Rosen, 2002).
194 GAY SEIDMAN
As American brands sought sub-contracting relationships, local apparel

industries mushroomed in export-processing zones, from Mauritius to
Central America. Local entrepreneurs were not the only sub-contractors,
however: smaller producers, especially from now-less-favored East Asian
sites, also responded to changing American government policy and corpo-
rate strategies, hoping to gain access to lucrative American markets through
sub-contracting relationships. In an aspect of the apparel industry that is
rarely noted by analysts, the new commodity chain pattern involved a new
set of international linkages: from the early 1990s, South Korean and
Taiwanese entrepreneurs drawn by changing American tariff policies to
Central America became middlemen in a rapidly changing industry. Be-
tween 1989 and 1991, Rosen (2002, p. 147) reports, at least 82 Korean and
Taiwanese manufacturers moved to Guatemala, mainly investing in elec-
tronics and apparel factories. Almost inevitably, these new investments cre-
ated new jobs, but also new factory-level conicts, sometimes linked to
language barriers and tensions over workplace cultures.
At the same time, facing the rapid decline of American production of
apparel, American unionists began to raise concerns about the failure of
local states to enforce their own labor laws: in the effort to attract foreign
investment, especially to export-processing zones, local governments
repeatedly relaxed their own labor codes, sometimes explicitly promising
investors that the zones would be free of union interference. Several union
campaigns sought to strengthen workers union rights in specific Central
American countries; American apparel unionists, for example, embarked on
an organizing drive in the Dominican Republic, and launched a boycott
campaign of London Fog and other brand names, for their failure to press
Korean-owned sub-contractor to recognize a union in a Dominican
Republic export-processing zone. Notably, the AFLCIOs main efforts,
however, went into getting the U.S. government to push the Dominican
Republic to enforce its own labor laws (Jessup & Gordon, 2000).
This pattern was quite common: as apparel industry jobs moved off-shore,
American unionists turned to the American government for help: In 1996,
American Labor Secretary Robert Reich launched a new initiative, asking
apparel brand names to work with American clothing unions to monitor and
improve apparel factories outside the United States. These efforts, as has been
widely reported, soon collapsed into bitter recriminations largely over cor-
porate insistence on keeping any monitoring processes condential, in con-
trast to unions concerns that only transparency would lead to improved
working conditions, by creating public pressure on brands. Meanwhile, how-
ever, global activists raised public awareness of conditions in Nikes factories,
while student activists on college campuses took up questions about the con-
ditions under which licensed goods were being produced. By 2000, two sep-
arate efforts claiming to be seeking to improve conditions in the global
apparel industry had emerged in the United States: the Fair Labor Associ-
ation (FLA), backed by the industry and a tiny handful of human rights
groups, and the Workers Rights Consortium (WRC), supported by the
American apparel union, UNITE, student activists, and labor and human
rights groups (Boris, 2003; Ross, 1997; Esbenshade, 2004; Featherstone &
United Students Against Sweatshops, 2002).
In 1997, a year after the signing of Guatemalas peace accords, COVERCO
was founded by human rights and labor activists to try to monitor changing
labor conditions as part of an effort, as they put it, to help develop a culture
of compliance in a country that was emerging from authoritarian chaos. In a
situation where the Guatemalan state has been unable, or unwilling, to en-
force its own labor code, COVERCO was created to try to offer an alter-
native:
The Commission for the Verication of Codes of Conduct (Coverco) is a Guatemalan
non-profit organization dedicated to providing accurate and credible information about
working conditions. Coverco conducts independent monitoring and investigations of
workplace compliance with labor standards in Guatemalas major export industries
including apparel, bananas, coffee, and electricity for multinational companies and
international organizations. Objectivity, transparency, non-substitution and independ-
ence are the principle tenets of Covercos work (http://www.coverco.org/eng, 9/21/04).
Widely cited as the kind of independent monitoring group that might en-
force labor standards worldwide, the group emerged through discussions
between labor and human rights activists in Guatemala and in discussions
with both Liz Claiborne, then experimenting with independent monitoring
in response to increased American concern over working conditions in its
sub-contractors, and the International Labor Rights Fund a labor NGO
based in Washington DC which sought to develop new approaches to im-
proving working standards internationally. By 2004, both the FLA and the
WRC cited COVERCO in their materials as one of the leading monitoring
agencies in Central America although by 2004, the FLA had never asked
COVERCO to monitor any factories.
COVERCOs monitoring program is highly detailed, involving training
for its monitors in health and safety issues, unannounced visits, and above
all, transparency in its reporting process. Paid by international brands Liz
Claiborne, Starbucks, and major banana companies it has undertaken
monitoring projects in specific industries and factories, including in
Guatemala Citys apparel zone. Its activists are highly respected, and even
196 GAY SEIDMAN
Guatemalan trade unionists who generally express deep reservations about

independent monitoring, arguing that it undermines workers voice (inter-
views, Fuentes, Guatemala City, 2003) recognize that its monitoring
efforts are more consistent, more independent, and more transparent than
those of other groups claiming to provide similar services.
Yet even COVERCOs own activists acknowledge the limitations to their
efforts: a small, relatively underfunded NGO, it is hardly able to cover the
entire apparel industry. Even more problematic, it depends on brandnames
commitment for its access to factories, as well as for its monitors salaries.
The monitoring groups efforts to maintain an independent stance limits its
ability to engage directly with workers unionization efforts, and sometimes
makes it impossible for the monitors to respond to complaints sometimes
even in dire situations. Most seriously, if it nds problems in a factory,
COVERCO cannot prevent its clients the brandname corporation from
ending their contract with the sub-contractor. While COVERCO has been
careful to work only with brand representatives who seem genuinely com-
mitted to improving conditions in their Guatemala sub-contractors facto-
ries, COVERCO has no mechanism other than moral suasion to keep brands
engaged in a problematic situation. Unless international unions and the
Guatemalan state step in, the monitoring group has little power to intervene.
ACTUAL EXISTING MONITORING
What are the commonalities between existing monitoring schemes and

how do those patterns t with the visions that drive public discussion of
corporate codes of conduct and soft global regulatory schemes? Through
the comparison of these success stories, I hope to interrogate some of the
underlying assumptions that run through discussions of independent labor
monitoring. First, I explore similarities between the starting point of each
scheme, looking at the kinds of activist network and issues that drive
the program, and the extent to which these networks reect the stateless
vision of global activism that often dominate theoretical discussions. Then,
I will turn to some of the patterns that can be discerned in the actual
implementation of these monitoring schemes, comparing those similarities
and differences with the vision embodied in discussions of global
governance.
Each of these cases Sullivan, Rugmark, and COVERCO are cited as
relatively successful examples of transnational campaigns pushing corpora-
tions to accept independent monitoring of workplace conditions, but that
picture is somewhat misleading. In fact, each of these programs came as a

result of local activists efforts to make workplace-related issues visible but
in each case, the workplace issues were closely linked to a much wider
agenda, having more to do with human rights issues than localized work-
place grievances. Labor exploitation may have been central to apartheid as a
system, but it was the larger systemic character of racial oppression that
brought South Africa under an international spotlight, not segregated can-
teens or workplaces. Similarly, the problems of child workers in Indias
carpet industry were given prominence as an example of a larger problem
the forcible exploitation of bonded workers. Even in Guatemala, where
workplace violations were central to the monitoring program, activists saw
workplace violations as a reection of a broader set of human rights
violations, and as a reection of the states failure to protect its citizens more
broadly.
At the same time, it is worth noting that none of these programs were
initiated by local trade unions, although in several cases, local unionists
were at least initially friendly to their efforts. In general, they stemmed from
activist campaigns drawing on transnational themes, linked more directly to
human rights issues than to labor questions. As Keck and Sikkink (1998)
suggest, transnational movements have tended to achieve greater success
when they appeal to direct humanitarian concerns than when they deal with
complex, multifaceted problems. The anti-apartheid movement, campaigns
against child labor, and even Guatemalas human-rights-as-labor-rights
campaign seem to t easily into the broader pattern they describe:
As we look at the issues around which transnational advocacy networks have organized
most effectively, we nd two issue characteristics that appear most frequently: (1) issues
involving bodily harm to vulnerable individuals, especially when there is a short and
clear causal chain (or story) assigning responsibility; and (2) issues involving legal
equality of opportunity (Keck & Sikkink, 1998, p. 27).
Racial discrimination, child labor, and the blurry line between human rights
abuses and labor rights in Guatemala all make a more appealing case for
international intervention than simple transgressions of labor law. This
pattern is understandable. Labor violations tend to be far more specific, and
far less gripping to external audience, than gross violations of human rights;
indeed, as Brooks (2003) has recently written, the effort to attract interna-
tional attention can prompt international activists to present workers as
victims, asking them to bear witness to atrocities, much as survivors of
massacres have borne witness to gross violations of human rights. But the
stimulus for the monitoring programs and, as I shall argue below, the
198 GAY SEIDMAN
pattern of monitoring and reporting do not generally come from local

workers themselves, but rather from well-intentioned activists, whose def-
inition of the grievance may, in turn, be shaped more by international hu-
man rights discourse than by workplace conicts.
Thus, it is perhaps not surprising that in each case, local activists raised
issues that linked directly with ongoing international campaigns, or that
their campaigns invoked credible threats of greater international sanctions.
Divestment activists and South African trade unionists were obviously
linked to the anti-apartheid movement; Indian child labor activists were part
of a much larger campaign against child and bonded labor, especially in
South Asia. Guatemalan activists responded directly to growing concern in
the United States about the character of globalization, and concerns about
the spread of the apparel industry to neighboring states, outside the reach of
American unions or the U.S. Labor Department. Without the involvement
of those larger global networks, it is arguable that activists in none of these
cases could have persuaded employers to accept any form of monitoring.
It is worth noting, in contrast to the stateless vision of transnational
corporate regulation, that in all three cases, international networks appealed
to powerful state actors, threatening state action to block goods produced
under unacceptable conditions. In South Africa, the growing strength of the
divestment movement was directly linked to legislative action, especially at
the level of major American cities and states; most companies signed on to
the Sullivan Principles only when discussions of national economic sanc-
tions began to sound increasingly plausible. In India, the carpet industry
was all-too-aware of the threat of legislative action: both the United States
and Germany, two major markets for their products, were contemplating
bans on goods produced by illegal child workers. In Guatemala, the U.S.
Trade Representative made sure that Guatemalan apparel producers
understood that access to American markets could be made contingent on
showing some effort to improve sweatshop conditions. In each case, before
any codes of conduct were adopted and before employers agreed to allow
external monitors into the workplace, employers faced real threats that na-
tional legislation would block access to key export markets.
Following the boomerang approach deployed by the human rights cam-
paign, transnational activists appealed to their own national governments to
make access to national markets contingent on improved corporate be-
havior internationally. This underscores, of course, the importance of local
linkages with transnational efforts; without transnational campaigns, there
would have been no threat of legislative action to inuence corporations.
But again, this pattern is quite different from the citizenship-based appeals
of traditional labor campaigns: the appeal here is to transnational audienc-

es, and to foreign states, rather than to domestic national labor enforcers.
Nevertheless, it is also true that those campaigns do not, on their own,
appear to have produced corporate agreement to self-regulate; far from
demonstrating that monitoring efforts can be proffered as an alternative to
state involvement in transnational labor issues, each of these examples
can be directly linked to the threat of state enforcement but the enforcing
state is the importing state, not the state in which the production is occur-
ring. Instead of the enforcement of citizenship rights, the boomerang op-
erates to protect labor grievances through controlling access to international
markets limiting this boomerang mechanism to goods destined for export
markets.
In a sharp contrast between the rhetoric of the ethical consumer move-
ment and the reality, not one of these monitoring processes has been
implemented as the result of individual consumer pressures. In each case,
monitoring schemes came in response to organized consumers, acting collec-
tively through institutional bodies. The anti-apartheid movements pressure
came through institutional stock-holders: church bodies and universities, all
as institutional shareholders, wielded far more weight on corporate managers
than individual stockholders could possibly have done. In India, the organ-
ized church movement, together with the German development agency,
played a key role in shaping Rugmarks approach, rst by persuading large
German retailers to demand the Rugmark symbol, and then by working with
Indian exporters to design and implement a regulatory scheme. In the case of
the apparel industry, students have been almost as important in forcing
corporate acquiescence as labor activists; but just as students in the anti-
apartheid movement pushed university administrations to act as ethical
institutional stockholders, students in the anti-sweatshop movement have
worked effectively through university purchasing and licensing agreements,
rather than simply focusing on persuading individual consumers to buy goods
produced in union shops. Organized consumers, acting through institutions,
carry far more weight and are far more likely to be disciplined in their
purchasing decisions than individuals, no matter how ethical, and corpo-
rations are far more likely to respond to those organized pressures than to the
threat of individual consumer boycotts.
But what of the impact of these schemes on working conditions? Through
the comparison of actual existing monitoring, what similarities can we nd
in the character of corporate codes of conduct, and their impact on the
workplace? Here, again, the record diverges markedly from the vision: in-
stead of providing the basis for ratcheting up standards at the workplace,
200 GAY SEIDMAN
the monitoring cases I have examined here appear more likely to demobilize
international attention and to avoid further pressure to improve workers
conditions than to lead to more intense scrutiny or to a more enforceable
regulatory framework.
Perhaps, the most common claim for corporate codes of conduct based on
ethical consumer pressure is the assertion that codes of conduct lead to a
changed corporate culture: repeatedly, proponents of transnational monitor-
ing suggest that as managers around the world are forced to pay attention to
a global code of conduct, their workplace cultures will be transformed
to acknowledge and respond to workers grievances. From South Africa, to
India, to Guatemala, this claim appears to have some basis in fact: consumer
pressure has clearly prompted concern for corporate image. In South Africa,
multinational corporations initially insisted they had no responsibility for
apartheid; after 15 years of concerted pressure, major business leaders had
acknowledged an independent role in society, and began to call for an end to
strict racial segregation. Similarly, in India, when activists rst raised ques-
tions about child labor, leading carpet manufacturers claimed that childrens
nimble ngers were required for knotting the best carpets; within a decade,
leading manufacturers were much more likely to point out that for the highest
quality carpets, only a trained adult weaver would do. And in Guatemala,
apparel employers were clearly aware of international pressures to improve
working conditions, especially as major brands and even the Guatemalan
state began to discuss working conditions.
But was the change in discourse mirrored by changing behavior within the
workplace? Here, the record is rather murkier. In South Africa, there is
ample evidence to suggest that the monitoring scheme had little impact on
the workplace, and even less on the overall problem that the Sullivan system
was designed to address. In 1987, after the Reverend Sullivan himself
publicly announced that his program had not contributed adequately to-
ward eliminating racial discrimination, only a tiny handful of advocates
mostly, people who worked directly with the monitoring scheme, either
through the accountancy rm paid to carry out Sullivans monitoring or
working on the board of the organization overseeing the principles
continued to claim its impact was meaningful (e.g., Sethi & Williams, 2000,
p. 351). In India, Rugmarks impact is probably even more negligible: after
10 years of Rugmarks existence, child labor activists and trade unionists are
bitterly critical of Rugmarks approach, using the same kinds of terms
corporate camouage, window-dressing, and worse that anti-apartheid
activists used to describe the Sullivan system. Finally, while Guatemalan
labor activists tend to be less dismissive of COVERCOs efforts, they
nevertheless regularly assert that monitoring has not made an important

contribution, pointing out that when monitoring has revealed problems in a
sub-contractor, major brands have been more likely to cut off the contract
(and lose workers jobs) than to insist on ameliorating conditions.
Two issues seem particularly important in evaluating the impact of mon-
itoring schemes. First, as critical activists point out in the case of each of
these schemes, any consistent non-state monitoring program has been fund-
ed by corporations, usually through a levy on participating companies, but
sometimes more directly through contracts between brand names and mon-
itoring programs. This pattern of funding seems unavoidable in non-state
regulatory schemes, but in each of these cases, it has caused suspicion,
antagonism and angry accusations of complicity. Repeatedly, corporate
funding for monitoring clouds the integrity of the process, causing, in each
case, bitter division between activists who initially worked together to raise
public awareness of the issue.
Second, each of these monitoring schemes seems woefully inadequate to
the task it is meant to achieve. This is not surprising, of course, since only
the most glaring problems have attracted the kind of global attention that
engages corporate compliance. But in each case, decisions about the actual
design of the monitoring process seem surprisingly arbitrary so arbitrary
that it is hard not to interpret the vagaries of each scheme as little more than
an effort to offer overseas consumers vague promises, providing the cover of
monitoring, in the terms of the old Brazilian saying, para os ingles ver [for
the English to see].
Finally, however, it is important to note that each time a monitoring
scheme has been put in place, it has quickly been surrounded by a prolif-
eration of other corporate codes of conduct many of which have no
monitoring whatsoever attached. In India, for example, the Carpet Export
Promotion Council has created its own code of conduct, claiming moni-
toring but giving no evidence that monitoring has occurred; simultaneously,
every carpet factory in the world seems to have attached No Child Labor
labels to their rugs, with no evidence whatsoever of its validity. Similarly, in
Guatemala, the apparel export council has created its own code of conduct
for the apparel industry, and published posters and guidelines in English,
Spanish, and Korean, so that the industry can claim that all its companies
are good corporate citizens despite the councils apparent failure to mon-
itor that claim (interviews, Guatemala, 2003).
This proliferation of codes and schemes has an obvious effect: by crea-
ting confusion for consumers and contractors, it undermines any like-
lihood that monitoring will lead to the ratcheting up of conditions.
202 GAY SEIDMAN
Most consumers indeed, many activists in the ethical consumer move-

ments will be unable to distinguish between labels and codes.
While some proponents for a non-state approach to corporate regulation
suggest that consumers will begin to insist on monitoring the monitors, these
three examples do not offer much reason for optimism: in each case, com-
panies who were unwilling to submit to even problematic monitoring
schemes quickly found alternative ways to indicate some compliance with
the basic thrust of the program.
And, of course, this proliferation of codes serves as a reminder that by
their very structure, global codes of conduct give workers no voice in their
design. In contrast to traditional workplace channels of grievance articu-
lation, codes of conduct impose global concerns, which may not reect the
priorities of local workers themselves. Especially in cases where codes are
linked to larger human rights issues, monitoring tends to emphasize the
visible and the measurable; in none of these cases have independent mon-
itoring schemes been important in efforts to construct meaningful channels
at work, through which workers could articulate grievances or monitor their
own conditions through appeals to external regulatory agencies.
CONCLUSION
What lessons, then, can we take from this comparison? On the negative side,
there is the obvious conclusion about codes of conduct and corporate self-
regulation. None of these examples offer much support for a vision of
stateless global governance, where multinational companies might be mon-
itored by independent civil society groups supported by alert consumers.
Instead, they all support a more skeptical view, stressing both the limits to
corporate self-regulation, and the risk that consumer pressure will be wa-
tered down by a profusion of less-meaningful codes.
Moreover, each of these cases underscore the limits of the human rights
approach to global working conditions. In bearing witness or making
workplace grievances visible to an international community, none of these
processes of monitoring have been able to incorporate real attention to
developing workplace mechanisms of communication. Instead, they tend to
stress human rights violations, and to draw on a larger agenda as monitors
dene the workplace issues that are of most concern. In order to attract
international consumer attention to workers rights, must we abandon a
basic industrial relations framework?
But there are positive lessons as well, ones that resonate with the history
of labor protections in the United States in the rst part of the twentieth
century. Historian Eileen Boris (2003) argues that throughout the early
decades of the century, efforts to promote private workplace codes worked
in parallel and in tandem with state efforts to regulate working conditions;
although these hundreds of codes worked through voluntary systems of
enforcement, they gave impetus to growing state regulation.
In the same way, perhaps, each of these cases point to a similar possibility:
as calls for codes of conduct and consumer boycotts spread internationally,
growing awareness and concern about workplace issues might begin to cre-
ate a constituency for greater regulation of work, both domestically and
internationally. As each of these cases show, state involvement clearly pro-
voked corporate self-regulation; perhaps publicity around major grievances
and transnational consumer activism makes it increasingly plausible for
state actors, in both exporting and importing markets, to attempt new forms
of global governance. However, that conclusion also points to a somewhat
different direction than most scholars and policy-makers have stressed:
rather than focusing on independent, non-state action, perhaps efforts to
regulate transnational working conditions should instead be focusing on
bringing the state back in.
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THE POVERTY OF
RESOURCE EXTRACTION
Stephen G. Bunkery
ABSTRACT
One of the defining characteristics of industrial capitalism is the rapid
expansion of social production. This expansion requires increased use of
matter and energy. Society cannot create either matter or energy, so
industrial expansion in one place means that matter and energy must be
extracted and transported from other places. Because social production
expands through both new technologies and new products, industrial
growth requires not only greater amounts, but also an increasing variety
of material and energetic forms. Because these different forms of matter
and energy are found in limited quantities in different parts of the world,
expansion, technological innovations, and product differentiation in pro-
ductive economies entail the frequent relocation of extractive economies,
either because they have depleted the natural resources on which they
depend or because new technologies have shifted the market. Regions
which depend on exporting extracted natural resources are therefore
likely to suffer from severe fluctuations in income. Capital sunk in ex-
tractive infrastructure may devalue radically. These problems limit their
capacity for sustained development. Nonetheless, resource extraction fig-
ures prominently in the economic plans of many lessdeveloped nations.
A growing literature addresses the economic or the political pitfalls that
beset extractive economies. This essay explores their ecological roots.

ISSN: 1057-1922/doi:10.1016/S1057-1922(05)11008-7
211
212 STEPHEN G. BUNKER
SOCIETY AND NATURE

We cannot understand social production without understanding natural
production. Social production requires matter and energy, which humans
can neither create nor destroy, and whose transformations follow physical
laws which humans cannot change.
Most analyses of development focus on the differences between the
means, relations, and amounts of production and consumption in different
societies. Production in society, however, is merely the transformation of
matter and energy originally produced in nature. Natural production is also
the transformation of matter and energy, and so differs from social pro-
duction only in the sense that humans intentionally intervene in those
transformations, which we call social production.
This single difference, however, though, has a series of profound and far-
reaching consequences. Human intentionality is directed by social learning
and information, and this information is cumulable across generations.
Much of this accumulated information is technological, that is, it species
the outcomes of particular combinations of matter and energy. Human
needs and desires are expansive, so humans have used this information to
direct and accelerate the transformation of matter and energy into in-
creasing numbers and volumes of useable or exchangeable forms. Because
technological information is cumulable, social productivity has increased
enormously over the relatively short period since the evolution of
Homo sapiens.
As more technological information has accumulated, and as this infor-
mation has been directed to the transformation of an expanded amount of
matter and energy into a larger mass and greater variety of products, social
production has been divided into a growing number of specialized tasks.
Different specialized groups produce different commodities. Within each
resulting sector, smaller groups carry out different steps or processes. These
processes must be coordinated in time and space.
Coordination is easier and less costly across shorter distances, so the
different processes tend to locate as close to each other as possible. The
resulting spatial concentration of social production not only facilitates
transport and communication, it also lessens the cost to each specialized
sector of the roads, canals, railroads, water pipes, drainage systems, power
lines, and other infrastructure which their operation requires. Industrial and
transport use of fossil fuels has greatly increased the tendency for social
production to expand rapidly within relatively concentrated spaces, because
these non-human energy forms allow an increased amount of matter and
The Poverty of Resource Extraction 213
energy to be imported and transformed by less human labor in a bounded

area.
Natural production, in contrast, is not subject to intentional direction.
The kinds of information that affect natural productivity are genetically
encoded through selective processes of evolution and coevolution within and
between species. They are not susceptible either to social learning or cross-
generational transmission except in a few limited cases, and those few cases
are not technological in the sense dened above. Rather, they involve the use
of a single tool or the exploitation of a particular kind of food and so are not
cumulable in the same sense as social learning and technological innovation.
An even more important difference between social and natural produc-
tion, though, is that production in nature occurs only within and between
the metabolisms of individual organisms. A particular organism contributes
to natural productivity only to the extent that it stores internally energy and
matter in forms which can be consumed, transformed, and stored again by
some other organisms metabolic processes. In contrast, most social pro-
duction occurs outside of the individual organisms human body; human
producers are not directly consumed but rather continue to manipulate
matter and energy to produce desired products rather than simply to sustain
and reproduce themselves physically.
Social productivity can be increased by learning and applying information
about the results of energetic and material transformations. In nature, pro-
ductivity can only be increased if new species add to the total amount of
matter and energy transformed within an ecosystem a bounded area de-
ned by interaction between interdependent species (Kendeigh, 1974).
These new species can only evolve, however, if other species are already
storing metabolically that is, within the individual organisms of their
members the amounts and forms of matter and energy necessary to sustain
the new species. The new species sustains itself by consuming matter and
energy stored in other species. It produces by transforming this matter
and energy into new molecular structures within its members own organ-
isms. This transformation requires energy, so some of the energy consumed
is dissipated as heat. The consumed matter is not all perfectly absorbed;
some is lost as excrement or detrita. Because some matter and energy are
thus lost in each transformation, the new species itself can only produce a
mass smaller than the mass made available to it by other species
production.
The new species can store and dissipate matter and energy in ways that
feed back into the environment in ways that promote the growth of other
species in the production chain on which it depends. The entire system,
however, is nally bounded by the metabolic processes of all of the different

species within it. This limits both the rate and the amount that natural
production and productivity within an ecosystem can increase. Through the
coevolution of multiple species, an ecosystem can become more productive,
but its biomass that is, the total amount of matter and energy produced
increases much more slowly than social production. Unlike increases in
social productivity, this growth is asymptotic, that is, it tends to level off
beyond a certain point (Ophuls, 1977).
The attentive reader will by now be objecting that I am trying to explain
far too much with what I called the single difference between natural and
social production, that is, that humans intentionally intervene in one but not
in the other. Intentional intervention by itself, this reader will argue, is
certainly not enough of a difference to explain why social production ap-
pears almost indefinitely and rapidly expansive while natural production
expands slowly and then levels off. If both natural and social production are
merely the transformation of matter and energy, why should one be able to
expand so and the other not. We all know that matter and energy cannot be
created or destroyed, but only transformed; why and how does society ap-
pear to escape from these bounds when nature cannot.
The answer, of course, is that natural production systems are limited to
the transformation of matter and energy that occur within the bounded
space of particular ecosystems. Previous transformations of matter and en-
ergy, ranging from volcanic upheavals to the far gentler and more routine
photosynthetic capturing of solar energy by plants, provide the stored
material and energetic forms that comprise biomass within particular eco-
systems. Ongoing photosynthetic capture of solar energy by plants contin-
ues putting energy into the system. Other organisms consume and store the
energy and matter combined in plants which perform photosynthesis. These
organisms are themselves consumed, and the energy and matter they have
stored are again transformed and stored in the organisms which consume
them. This chain of transformations and storage involves an ongoing in-
teraction between contemporary and past production. The fertility of the
soil, and indeed the contours and composition of the ground that determine
water ows, retention and even patterns of evapo-transpiration, are the
results of previous natural production processes. Any natural production
system, however, is limited to the matter and energy stored plus the incident
solar energy in the bounded area of its ecosystem.
Social production systems, through the accumulation of information and
the development of production and transport technologies, have been able
to break beyond the bounds of particular ecosystems and to import matter
and energy across these boundaries. It is for this reason that social pro-
duction can expand so much more rapidly than natural production. No
matter how much it expands, or how productive its technologies become,
however, social production cannot create the matter and energy which it
transforms, so it must import these from the natural production systems of
multiple other ecosystems.
Social production systems tend to concentrate in relatively small areas. If
the social production system has to import matter and energy in order to
continue its expansion, and if these have to come from natural ecosystems
which are not spatially concentrated in the same way, it follows that some
other kind of system must emerge to export the material and energetic forms
required for social production. These systems, which we will call extractive
economies, are not themselves directly productive. They are social, but they
cannot develop in the ways that social production systems do. First of all,
they cannot concentrate spatially, because they must extract an increasing
amount of matter from spatially bounded, geographically dispersed, natural
production systems which are not increasing their productivity. This means
that extractive economies must constantly expand into new spaces. Also, the
extractive economies do not themselves determine the kinds of matter and
energy which they exploit; social production systems determine that with
their own technologies and market demands. Because different ecosystems
produce different material and energetic forms, extractive economies must
locate near the natural systems that happen to produce the forms, which are
at that time required by the social production systems. This means that
extractive economies cannot concentrate in relatively small areas that do not
control their own location. It also means that if the production systems
demands change, the extractive economy located near a particular resource
loses its market or suffers a fall in prices. We will consider these problems
soon, but rst we must examine a related problem, resource depletion.
Production and consumption are really integral parts of the same process
in natural systems. Production occurs within the metabolism of the pro-
ductive organism, and the organism is consumed in the productive processes
of other organisms. Natural production within an ecosystem depends as well
on the physical congurations of previous productions as they are stored in
the soil and as they have shaped crucial geological formations such as water
systems. When extractive economies start to export matter and energy from
natural systems, they necessarily reduce the matter and energy stored in the
natural system. Indeed, they may actually reduce the number of direct pro-
ducers if they take out living organisms, such as trees or sh. If only a
limited number of older members of a species are taken out, natural
production may actually increase, as there is more matter and energy avail-
able to younger members of a species, but, for reasons which will be ex-
plained later, direct producers are usually reduced at rates that diminish
their capacity for reproduction. Alternately, extraction may disturb the
conguration of soils and water courses by taking out sub-soil minerals. The
minerals may not directly contribute to contemporary production, but the
soils and water courses do.
Because the production that occurs within the metabolism of the organ-
isms of one species becomes the matter and energy required for the pro-
duction of the species that consume them, reduction of producers in one
species can ramify through numerous other species within a single eco-
system, thus reducing their total productivity. If this happens, the reduction
of matter and energy in an ecosystem can be far greater than the amount
actually exported to the social production system. This means that the ex-
tractive economy that depends on living or self-renewing resources actually
reduces the natural production on which it depends. Such an economy must
constantly relocate or expand its area of operation. The problem is simpler,
but just as difcult, when the extracted resource cannot renew itself in hu-
man time. In this case, the amount of minerals, fossil fuels, or other ma-
terials extracted directly and irrevocably reduces the remaining stock and so
hastens the moment when the resource is exhausted.
A society that must constantly relocate faces a series of social and eco-
nomic costs, which reduces its capacity to develop. In a productive econ-
omy, human labor directs some of the matter and energy it transforms into
permanent structures roads, canals, buildings, power lines, and docks,
which facilitate production, communication, and transport. Some of this
infrastructure includes machines that directly heighten labors productivity,
but all of it in one way or another carries past labor into the present in ways
that reduce production and marketing costs. Some of this infrastructure
wears out through use and some of it is made obsolete by technological
innovations; but because the social system is diversied, different parts are
replaced at different times. There is seldom a need to abandon or replace the
entire conguration. The relative stability of these congurations also means
that social services, hospitals, schools, etc., can be built with the expectation
that there will be ongoing opportunities for schooling, health services, and
employment for subsequent generations.
All of this is possible because the location of social production is in large
part determined by social decisions. Certainly, many cities were originally
located because of particular natural advantages fertile soils, adequate
water, bays for shipping, even forests and minerals. The progressive
concentration of population and economic activity, however, responds to

the accumulation of multiple intentional acts to take advantage of the op-
portunities offered by proximity between these specialized activities. Ex-
tractive economies, however, must locate near the naturally produced
resources they exploit. Extractive activities, instead of encouraging other
enterprises to locate nearby, may actually diminish the economic opportu-
nities in the region (Bunker, 1985). Extraction therefore tends to be a dead
end, both economically and socially. In the following sections, I will discuss
why extraction and production are separated in space, how extractive econ-
omies work, why they are different than productive economies, and why
they tend to underdevelop themselves. I will leave for more extensive treat-
ment elsewhere the obvious next questions if extractive economies tend to
underdevelop society, why do some human groups engage in them? And
why do some countries deliberately promote them?
THE SPATIAL SEPARATION OF

PRODUCTION AND EXTRACTION
In simple economies, extraction and production often occur in close prox-
imity; individuals and groups typically engage in both activities. As social
production expands under capitalism, both the amount and the variety of
material and energetic forms consumed in its concentrated industrial loci
increase. Natural production, however, does not increase or diversify at the
same rate as social production. Indeed, many particular forms are naturally
produced only within particular ecosystems in specific locations, and ex-
traction usually leads to a depletion or reduction of natural products in
these specific locations (Jalee, 1969; Caldwell, 1977; Bunker, 1985). Cap-
italist expansion can only occur, therefore, through the proliferation of
dispersed extractive economies (cf. Lenin, 1965; Luxemburg, 1968). The
expansion of industrial capitalist production entails, as a physical necessity,
the widening spatial and temporal separation of extraction and production
(Bunker, 1992, 1996). Matter and energy ow from increasingly dispersed
extractive economies, whose locations are primarily determined by natural
processes, to increasingly centralized productive economies whose locations
are socially determined. The development of transport technologies that
reduce the time and cost of bringing raw materials to industrial centers
accelerates this ow and widens the cumulative distances between the many
extractive and the few productive economies (Bunker & Ciccantell, 1999).
The accumulation of value, growing social complexity and power, and

continuity and exibility of physical infrastructure and social organization
in the productive economy all require expanding quantities of matter and
energy, which can only be gained through corresponding loss of value, social
simplication, organizational instability, and infrastructural impermanence
in extractive economies. The search for raw materials drove the expansion of
early states and empires and extended trading networks (Ekholm & Friedman,
1982, p. 97; Diakonoff, 1969, p. 28; McNeill, 1963, pp. 7174; Adams, 1977,
pp. 165174; Drennan, 1984; Chaudhuri, 1985, pp. 203204). Nonetheless,
with the notable exceptions of lumber for ships, metals for arms, and stones
for building, most of the matter socially transformed was extracted close at
hand. It was not until the conquest of the New World that extracted matter
in large quantities was transported between widely distant regions, as gold
and silver, cacao, animal oils, and spices fueled the surge of commerce that
preceded the capitalist revolution (Bunker & Ciccantell, 1998).
Industrial capitalism makes the progressive spatial separation of extrac-
tion and production physically inevitable. Under capitalism, dominant
classes systematically intervene in the organization and coordination of
production for profitable exchange. Individual rms compete to lower
commodity prices by substituting non-human energy for human energy. The
reduced unit costs of production allow increased per capita consumption of
transformed matter and energy. Expanded consumption widens and deep-
ens the markets through which capital circulates, thus accelerating the
accumulation of capital at the same time that it stimulates investment in new
enterprises. New enterprises purchase more labor. Urban industrial popu-
lations grow as per capita consumption of matter and energy increases.
Through these cumulative and mutually reinforcing processes, each incre-
ment in the industrial transformation and consumption of matter and en-
ergy creates the conditions for a further increase in the amounts of matter
and energy required. Fossil fuels and new technologies have so reduced
transport costs that a wide range of material and energetic forms once too
bulky for profitable exchange can now move, in large quantities, across
great distances. This, in turn, allows for tremendous increases in the mass of
matter and energy transformed by industry. It also intensies its inherent
tendencies to spatial concentration.
The same forces that expand capitalist production foster its spatial con-
centration (Smith, 1984). The increased use of non-human energy requires
an increased scale of production. This reduces the number of individual
competitive rms in specific sectors, so it centralizes production spatially at
the same time it concentrates entrepreneurial control. It also requires larger
and more costly machines within larger and more specialized rms. The
proliferation of different machines means that the chain of labor the
number of specialized steps or phases in the transformation of naturally
produced forms into commodities becomes longer. The different phases
that result must occupy different physical spaces, so the movement of the
matter and energy being transformed through this chain imposes increased
transport and communication costs.
These communication, coordination, and transport costs can be reduced
by proximity between the different processes within this chain, so rms tend
to locate close to each other. Proximity also lowers costs by allowing for the
sharing of some of the capital xed in infrastructure docks, streets, canals,
railroads, etc. The spatial concentration of multiple rms promotes as well
the urban agglomerations, which provide both labor for production and
markets for commodities. In summary, expansion of social production, the
concentration of ownership of the means of production, the proliferation of
increasingly specialized and interdependent divisions or links in the chain of
labor, and the spatial concentration of industrial production all reinforce
and accelerate each other.
Expanded production entails product diversication. Social demand for
particular products is necessarily nite, so expansion requires the contin-
uous creation of new needs or demands. The mass of energy and matter and
the diversity of naturally produced forms consumed thus increase together.
The progressive substitution of labor by new and larger machines also re-
quires an expanding variety of material and energy; coal instead of wood, oil
instead of coal; bauxite, manganese, and chromium instead of iron. They
also require more intense conversions of energy, which result in higher
temperatures that can only be contained and controlled by alloys that use
new combinations of minerals. The energy thus transformed must be trans-
mitted at new efciencies and speeds requiring, for example, the substitution
of copper by more conductive metals. These material forms occur naturally
in different parts of the world, so they must be extracted from an ever wider
range of locations. The expanded mass and diversied forms of matter and
energy consumed must be drawn from progressively more distant and dis-
parate sources.
Because matter and energy can be imported from many ecosystems, social
production can be vastly increased within a bounded space. To a lesser
degree, the mix of social and natural production which comprises agricul-
ture can be similarly intensied. Natural production, however, does not
accelerate at the same pace; indeed, most extraction either depletes what is
already produced or reduces productivity in ecosystems. The progressive
separation of extraction and production proceeds at rates determined by the

different rates and direction of change in social and in natural production,
as well as by social demand for new energetic and material forms.
THE INTERNAL DYNAMIC OF

EXTRACTIVE ECONOMIES
As we have seen, extractive economies must locate near the natural pro-
duction systems they exploit, but once organized there, labor is directed
according to the exchange-based, profit-maximizing logic of social produc-
tion systems. Ecosystemic production tends to conserve energy through
complex cycles of production and consumption between multiple species,
but extractive economies tend to concentrate on those few material forms
which provide the greatest returns to labor and capital. Because the ef-
ciency of ecosystemic production resides in the tight cycles of production
and consumption between multiple species, extractive specialization disrupts
ecosystemic production far more than the extraction of an equivalent
amount of matter and energy from a wider range of forms. Where species
diversity and interdependence is high, as in tropical forests, the effects of
extracting most members of a few species can ramify through extensive
biotic chains, reducing production by several times the amounts of matter
and energy actually extracted (Janzen, 1973; Richards, 1977; Bunker, 1985).
Exchange-oriented extractive specialization thus maximizes ecosystemic
costs in order to minimize labor and capital costs.
Specialized extractive economies develop in response to demands created
by direct consumption and technological needs within the productive econ-
omy. Self-sufcient regional economies that previously exploited a wide
range of natural products for their own use values start to concentrate on
the extraction of the narrow range of natural products, which will provide
the highest returns on external markets. In productive economies, produc-
tion is intentionally directed to products for which there is a known market.
In extractive economies, exportable goods are produced in nature without
and beyond human intervention or intention. Their value in exchange does
not direct the process of their production. Indeed, their exchange value can
only be realized by removing them out of the natural system that produced
it and away from the human economy, which extracted it.
This spatial separation of production, exchange and use in extractive
economies critically inuences the mechanisms that lead to different
patterns of development in extractive and productive economies. In

productive economies, where exchange value is socially and deliberately
created, competition between rms to lower costs engenders increased pro-
duction by increasing the scale of production. Labor benets as goods be-
come cheaper. Extractive economies, in contrast, cannot redirect natural
production, so increase can only occur by more destructive exploitation of
labor and nature. This causes a diminution of natural forces of production,
and a consequent loss of both use and exchange values.
The search for profit leads to specialization in both extractive and pro-
ductive economies, but the effects of specialization are very different. Spe-
cialization in a productive economy enhances labor productivity and
increases the mass of socially produced goods. Specialization within an
extractive economy, however, typically leads to depletion or to the disrup-
tion of the ecosystemic linkages, which sustain natural productivity and
symbiotic balance. Specialization promotes exibility in the production, and
rigidity in the extraction, of exchange values. The capitalist can determine
the form of the social product, and can thus direct labor to produce goods in
accordance with demand. Natures production cannot be directed; the only
possible response to changing demand is to extract more or less of a par-
ticular resource.
The dynamics of scale function inversely in extractive and productive
economies. The forces of production develop progressively in industrial
systems because the unit costs of commodity production tend to fall as the
scale of production increases. In extractive systems, unit costs tend to rise as
the scale of extraction increases. Extraction usually starts by appropriating
the most accessible sources. Greater amounts of any extractive commodity
can be obtained only by exploiting increasingly distant or difcult sources.
Although technological innovation may reduce costs of some extractive
processes in the short run, unit costs of extraction continue to rise in the
long run. Therefore, when extractive systems respond to increased external
demand or internal pressures to increase profits, they tend to impoverish
themselves (1) by depleting easily accessible non-self-renewing resources, or
(2) by exploiting the most proximate self-renewing resources beyond their
capacities for regeneration, thereby (3) requiring more labor and capital per
unit extracted and so (4) forcing the unit cost of the extracted resources to
rise so high that the development of synthetic or cultivated alternatives in
other regions or the development of transport technologies that cheapen
transport to more distant sources become cost effective.
The tendency for unit costs to rise is exacerbated by reduction of natural
production within symbiotic chains, which include the extracted resources
or which are disrupted by the process of extraction. Such disruption limits

the human carrying capacity of the extracted environment, and may over
time restrict the availability of labor (Bunker, 1985). It also increases the
costs of reproducing labor by limiting agricultural potential in areas near the
extractive enterprise. When this occurs, states and rms in productive econ-
omies seek other sources, or devise material substitutions.
Once an economy producing the raw material has been freed of the need
to locate near the source of the natural product, it will tend to locate where
land, labor, and infrastructure are more readily accessible and politically
controllable. Technologies that cheapen access to larger, more distant
sources, and successful plantation or industrial production of formerly ex-
tracted commodities, complete the cycle of extractive impoverishment and
instability by introducing progressive economies of scale in new locations.
The new locations competitive advantages eventually eliminate or seriously
reduce the original and increasingly costly extractive economy. The lowered
cost of the previously extractive raw material allows further expansion of
industrial production (Bunker, 1992).
Extractive economies constitute an extreme case of what de Janvry (1981)
has called dependent disarticulation. Socially articulated economies produce
goods for internal consumption. The resulting acceleration of social and
economic activity through linkages between wages, consumption capacity,
and markets enhances returns to capital and expands production of goods.
The articulation of production and consumption partially resolves the con-
tradictions between wage costs and profits, making wage increases and so-
cial welfare expenses systemically rational. The disarticulated economy, in
contrast, depends on externalmarkets and therefore lacks an internal con-
sumption-driven accelerator to rationalize high wages and welfare costs.
The spatial dispersion of extractive economies, their spatial and temporal
instability, and the periodic dislocation of the labor force as more accessible
resources within a region are depleted to create extreme forms of social
disarticulation.
SUMMARY AND CONCLUSION

The ecological dynamics of extraction have a series of unfavorable economic
outcomes. The economic and political mechanisms that underlie most of the
Dutch disease and resource course explanations, though, imply social agen-
cy, and so encourage a tendency to blame the extractive victims for their
own aborted development. In this nal section, I show how these economic
failures result from material, not social, causes.
Extractive economies necessarily locate at the most accessible sources of
raw materials; depletion removes them to areas increasingly distant from
existing demographic and economic centers. This raises the costs of labor
recruitment, subsistence, shelter, and infrastructural development. Labor
often becomes expeditionary, requiring the temporary migration of males.
Demographic instability impedes the emergence of linked local economies;
local sources of supply may not have time to develop fully. Because the
extractive enterprise is located far from other economic activities, it often
monopolizes whatever labor is locally available, further limiting the poten-
tial for other, linked economies.
Also, transport into the extractive region may be articially cheap, as
export vehicles for the extracted good would otherwise come in empty
(North, 1961). Cheap transport heightens competition from externally pro-
duced goods; further restricting whatever production is already established
or might emerge (see Weinstein, 1983). The extractive economy thus fosters
near total dependence on imported foodstuffs and other staple goods. This
further reduces the possibility of local economic linkages. The absence of
linkages and the distance from demographic centers enhance control over,
and exploitation of, labor, because the purchasers of labor can control the
provision of labors subsistence needs. Distance from established commu-
nities eliminates competitive demand for labor and reduces labors ability to
organize in its own defense, as there are few alternative social organizations
to provide support. Even when labor manages to organize successfully, its
power and its militancy are vulnerable to uctuations and instability in the
extractive enterprise and to the brutal repression, which its demographic
isolation and residential homogeneity facilitate.
The same forces that disperse extractive labor into unstable, economically
disarticulated, and politically isolated transitory communities also restrict
the potential for significant accumulation and reinvestment of capital that
might foment articulated productive economies in the region. Because the
extractive sector forms enclaves removed from other economic activities,
and because the infrastructure which it does develop tends to be highly
specialized and located in areas, which do not offer other economic oppor-
tunities, profits tend to be invested either in warehouses or transport fa-
cilities (Watkins, 1963, 1972; Levin, 1960; Naylor, 1972) or in other regions,
which offer better investment opportunities (Innis, 1956).
The tendency for unit costs to rise in extractive economies may lead to
more capital investment in the extractive process itself, but this concentration
of capital in removal and transport infrastructure frequently creates

especially severe technological dependencies on the industrial countries.
Railroads, steamships, docks, drilling rigs, pipelines, and earth-moving
machinery require techniques and capitals, which extractive economies are
highly unlikely to develop. The concentration of investment in export facil-
ities instead of production- enhancing infrastructure further concentrates
control over exchange and profit (see esp. Weinstein, 1983; Moran, 1974;
Solberg, 1976; Blair, 1976; Cobbe, 1979; Levin, 1960; Katzmann, 1961).
Alternately, excess capital accumulated from extractive exports may be in-
vested in real estate speculation in the urban export nodes (Weinstein, 1983;
Feagin, 1985; cf Harvey, 1982). This drives up urban rents and makes pro-
ductive investment even less likely. This phenomenon, though recognized
in the literature considerably earlier, only gained general recognition and
notoriety when it was baptized the Dutch disease in 1991 (see Barham &
Coomes, 1996; Coronil, 1997).
Some extractive economies have replicated the integration of extraction
and production that characterized pre-capitalist and early capitalist econ-
omies. The potential for such development depends in part on the spatial
location of the resource, in part on its natural or physical characteristics,
and in part on the degree of capital concentration and intensication in
the economic sector which uses or consumes the resource (North, 1961).
Because of the general tendency for capital to concentrate and intensify in
all productive sectors over time, and for materials to be used in more and
more costly machines, these possibilities for productive economies to emerge
from extraction diminish as capitalism evolves (Mandel, 1975). Capital ac-
cumulation and technological advances in productive economies also work
directly to restrict such possibilities; as transport technologies improve and
lower the costs for bulk movements of matter, the marginal price advantage
which preliminary processing to reduce bulk provides to the extractive re-
gion is pushed back toward pure extraction (cf. de Silva, 1982, p. 78). In this
sense, advancing globalization and the concentration and expansion of -
nancial and technological power that drives it exacerbates the relative im-
poverishment of extractive economies and their subordination to industrial
ones.
It should be clear that most of these dynamics occur beyond the power
domains that the society organized around an extractive economy can con-
trol. Social scientific theories focus on social causation whether as struc-
ture or through human agency and so may not incorporate the non-human
material or physical constraints on the progressive development of the
economics that mediate between social and natural production.
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FROM COLONIALISM TO GREEN
CAPITALISM: SOCIAL MOVEMENTS
AND EMERGENCE OF
FOOD REGIMES
Harriet Friedmann
ABSTRACT
This paper suggests that a corporate-environmental food regime is emerg-

ing as part of a larger restructuring of capitalism. Like past food regimes,
it reflects specific social and political compromises, which I interpret
through the social movement concept of interpretive frames. The di-
asporic-colonial food regime of 18701914 grew up in response to working
class movements in Europe, and created a historically unprecedent class
of commercial family farmers. When world markets collapsed, those
farmers entered into new alliances, including one that led to the mercan-
tile-industrial food regime of 19471973. Lineaments of a new food re-
gime based on quality audited supply chains seems to be emerging in the
space opened by impasse in international negotiations over food stand-
ards. Led by food retailers, agrofood corporations are selectively appro-
priating demands of environmental, food safety, animal welfare, fair
trade, and other social movements that arose in the interstices of the
second food regime. If it consolidates, the new food regime promises to
shift the historical balance between public and private regulation, and to

ISSN: 1057-1922/doi:10.1016/S1057-1922(05)11009-9
227
228 HARRIET FRIEDMANN
widen the gap between privileged and poor consumers as it deepens com-
modification and marginalizes existing peasants. Social movements are
already regrouping and consolidation of the regime remains uncertain.
THE QUESTION: IS A NEW FOOD

REGIME EMERGING?
It has been a decade and a half since scholars have recognized the unfolding
crisis of the postwar international food regime, and begun to track changes
that might constellate into a new food regime (Friedmann, 1994, 2005;
Friedmann & McMichael, 1989; Burch & Lawrence, 2004). That crisis be-
gan in 1973. This paper suggests that an emerging regime is part of a larger
restructuring of capitalism in response to green issues (Sandler, 1994;
Campbell, 2004; Campbell & Coombes, 1999; Campbell & Liepins, 2001).
The lineaments of what I call a corporate-environmental food regime appear
in very specific and unequal compromises among social movements, states,
and powerful agrofood corporations.
The corporate-environmental food regime, like past food regimes, is a spe-
cific constellation of governments, corporations, collective organizations, and
individuals that allow for renewed accumulation of capital based on shared
definition of social purpose by key actors (Ruggie, 1982), while marginalizing
others. Like prior food regimes, it will have important and very different
implications for farmers, food workers, and consumers in various parts of the
world. Unlike the postwar regime, which standardized diets, it is likely to
consolidate and deepen inequalities between rich and poor eaters. Like past
food regimes, it will deepen commodity relations in agriculture and transform
relations between farmers, food workers, and agrofood corporations.
International Food regimes are sustained but nonetheless temporary con-
stellations of interests and relationships. They are part of larger periods of
stability in relations of power and property, in the past corresponding to
British and U.S. hegemony. They are above all historical. Since international
markets in grain and livestock products began in the 19th century,1 food
regimes have been shaped by (unequal) relations among states, capitalist
enterprises, and people, who migrated, bought, sold, and reshaped cultures of
farming and eating within large, indeed, global constellations of power and
property. Relatively stable sets of relationships fall into distinct periods, with
unstable periods in between shaped by political contests over a new way
forward. Emphasis on periods of global stability, and of change, distinguishes
From Colonialism to Green Capitalism 229
the food regime approach from other ways of understanding agrofood sys-
tems (cf. Goodman & Watts, 1997). At the same time, even at their most
stable, food regimes unfold through internal tensions that eventually lead to
crisis, that is, to an inability of the key relationships and practices to continue
to function as before. At this point, many of the rules which had been implicit
become named and contested. That is what crisis looks like.
In order to understand the present transformation, I shift the focus of
analysis of past food regimes toward periods of restructuring instead of pe-
riods of stability. Contests over new directions have so far created new food
regimes something by no means guaranteed to continue into the future.
Contests have lasted almost as long as the regimes themselves. We are due for
a new food regime, if there is to be one. In order to ground analysis of an
emerging regime, I refocus historical analysis on transitions between the rst
and second food regimes, and on the rise of the rst. These are times of choice
over alternative ways to organize power and property in land, labor and
consumption. While I will not explore counter-factual trajectories what
might have happened if other actors and relationships had prevailed this
view of food in global history (Grew, 1999) attends particularly to those spe-
cific periods when several outcomes were possible. This shift in emphasis di-
rects attention to social movements as engines of regime crisis and formation.
Social movements take a much larger role in the paradoxical unfolding of
successive food regimes. On that basis, it is easier to understand how the
unraveling of the food regime that was in its prime between 1947 and 1973
left specific actors in trouble, particularly farmers and consumers, and how
other groups began to press new issues, particularly related to environment
and health. After a quarter century of contested change, a new round of
accumulation appears to be emerging in the agrofood sector, based on se-
lective appropriation of demands by environmental movements, and in-
cluding issues pressed by fair trade, consumer health, and animal welfare
activists. I take the reader through the following steps: rst, I describe an
emerging ecological or green capitalism; second, I interpret social move-
ment demands as entering into the shared perceptual frames that allow for
food regimes to emerge, and as contributing to unfolding regime crisis by
naming rules that were implicit while they worked; third, I retell the stories
of the rst and second food regimes as outcomes of social movements in
contention with each other and with powerful institutions of rule and
wealth; fourth, I look at environmental and other social movements that
arose in the interstices of the second food regime; fth and nally, I outline
how environmental and related politics are shaping an emerging food re-
gime as green.
GREEN CAPITALISM?
An ecological phase of capitalism would entail a shift in rules of economic
activity so that profits are renewed through less depletion of resources
(which can mean lower raw material costs), less pollution (which can create
demand for new technologies), and selling products that are culturally de-
ned as environmentally superior. This would be a dramatically different
environmental regime from the one that encouraged industrialization of
agriculture and food after the Second World War. According to Sandler
(1994, p. 44), an environmental regime always implicitly shapes class rela-
tions and profit-making activities, for instance, through understandings of
nature, cost accounting, allowable materials and products, taxes, and con-
sumer goods. Thus, environmental regimes always exist, even when they
promote ignorance of ecosystem effects or repression of social opposition to
damaging practices.
A green environmental regime would be one that reshapes accumulation
of capital through altering production practices so as to reduce harmful en-
vironmental effects and satisfy cultural shifts in demand for green com-
modities. This possibility contrasts with the usual assumption that capitalist
enterprises by their nature seek to externalize costs, such as pollution of
waterways by fertilizer runoff. Similarly, changes in environmental conscious-
ness and related changes in health, animal welfare, and trade concerns, lead to
consumer demand for new kinds of commodities. In a green environmental
regime, opportunities arise for technical, managerial, marketing, and input-
manufacturing enterprises associated with green food commodities.
In agriculture, other things being equal, this could mean elimination or
reduction of polluting industrial inputs. Of course, whether profits rise, fall,
or stay the same depends on whether, for example, on-farm nutrients (e.g.,
manure or compost) are recycled on farm or purchased from another en-
terprise, which becomes a new source of profit. In other words, does agro-
ecology dene new production methods, leading to reduction of market
activity? Or do green industrial farms shift demand away from agro-
chemical input industries and toward organic input industries specializing
in allowable inputs (Guthman, 2004)?
A green environmental regime, and thus green capitalism, arises as a
response to pressures by social movements. For example, concerns about
food safety and quality by consumers and about environmental effects of
industrial farming have inspired rapid growth since the early 1970s of a web
of enterprises that produce, process, transport, advise, supply inputs, certify,
and market organic foods. At the same time, the response is selective,
choosing those demands that best t with expanding market opportunities

and profits. Thus, according to Guthman (2004, pp. 110111), when the
farm crisis of the 1980s articulated with increased environmental concern
and changes in consumer tastes, prospects for growth tempted many pro-
ducers to shift from sustainable farming (a process and production orien-
tation) to organic commodities (a product and marketing orientation). This
in turn led to a drive for regulatory legislation [that] effectively subsumed
much of the organic movement into an organic industry.
Thus green capitalism is not a contradiction in terms. The imperative to
grow or die, Sandler (1994) argues, refers to profits not to quantities of
products. Only under specific rules of land use and taxation, and only with
certain cultural norms governing consumption, are profits dependent on
increased resource use or externalizing costs of pollution. Parallel to the
selective appropriation by the 19th century capitalism of demands for re-
duced exploitation initially in the form of shorter hours of work green
capitalism can selectively appropriate demands of environmental move-
ments for reduced pollution and depletion. Just as a coalition of enlight-
ened capitalists, middle-class reformers, and militant labor movements
brought us not socialism but welfare capitalism (ibid., p. 49), so the co-
alition of environmental, consumer, and fair trade movements promises not
reorganization of society around the central value of enhancing ecosystem
integrity, but green capitalism. If successful, it promotes a new round of
accumulation as a specific outcome of the standoff between conventional
and alternative food systems. If a new regime consolidates, a new frame
will make terms like these redundant; it will need no name. Challengers will
seek to name it, that is, to expose its implicit workings.
The shift to a corporate-environmental food regime is, if I am correct, the
most recent manifestation in agrofood production of the resilience of pow-
erful organizations, which appropriate social movement demands to serve
renewed accumulation (Scott, 1998). Before I turn to the two past regimes, I
would like to introduce a language for bringing social movements more
centrally into the histories.
RISE AND FALL OF FOOD REGIMES:

FRAMING AND NAMING
Food regimes have so far been based on implicit rules. The rst food regime
was framed within a general rhetoric of free trade and the actual workings of
the gold standard. The world wheat market that arose in the decades after
1870 was not really anyones goal. However, vast international shipments of
wheat made possible what actors really wanted to do capitalists wanted to
build railways, states of the European diaspora wanted to push back fron-
tiers against indigenous peoples and build states to rival (and complement)
those of Europe, and the poor and politically repressed of Europe wanted to
nd a better life in the European colonies. Wheat was the substance that
gave railways income from freight, expanding states a way to hold territory
against the dispossessed, and diasporic Europeans a way to make an income.
The second food regime was even more implicit. Agriculture was framed
specifically not as trade for much of those commodities that crossed fron-
tiers. Under the rubric of aid, an innovation of the post-World War II era
that worked through a monetary system centered on the US$, commodities
could be transferred without payments in the usual way. Because currencies
were divided into hard and soft according to whether anyone wanted
them outside the country, and after the War most currencies were soft, aid
was a way to transfer commodities for soft currencies; that is, not for pay-
ment of the usual kind. These transfers beneted everyone involved at cer-
tain times. Of course, they had many of the effects of trade, but ignoring
those effects and calling some transfers aid, suited powerful (and many not
so powerful) interests in all the countries that mattered.
The point is that beneath the natural appearance of a working regime lie
unstated assumptions that are in effect implicit rules guiding relationships,
practices, and outcomes such as which countries specialize in growing
certain crops and which countries are importers. Borrowing from the social
movement literature (e.g., Tarrow, 1994), I understand an enduring complex
of assumptions and implicit rules as a socially constructed frame for inter-
preting reality.2 I argue that food regimes emerge out of contests among
social movements and powerful institutions, and reect negotiated frames
for instituting new rules. The relationships and practices of a regime soon
come to seem natural. When the regime works really well, the consequences
of actions are predictable, and it appears to work without rules.
Implicit aspects of the frame become named, when the regime stops
working well, that is, when actions no longer have the same consequences.
Arguments over alternative ways of solving problems that arise as a result
take place in part over how to name aspects of the faltering regime. When
names catch on, it is a sign that the regime is in crisis.
A good example is naming certain transfers of agricultural commodities,
which once went under the universally approved rubric of aid, as dumping.
During the 1950s and 1960s food aid, as I explain below, was the frame for
transferring huge amounts of grain and other commodities internationally.

In the 1980s, some of it came to be named subsidized exports, which
sounds very different. In 1982, I argued that concessional aid (the ma-
jority of U.S. aid) was in effect dumping (Friedmann, 1982). Dumping refers
to sale of a commodity abroad at a price lower than in the domestic market.
This clearly t the practice of selling wheat and other surplus com-
modities to governments in return for soft or inconvertible currencies,
which was how most U.S. (and later European) aid worked. Case studies
showed that aid shipments, as one would expect dumping to do, led to a
decline in domestic food production. However, the frame included a widely
held belief that peasant agriculture was backward and bound to disappear.
There was widespread resistance to naming aid as dumping as long as it
helped the U.S. to dispose of its domestic farm surpluses, and the Third
World governments to welcome the many benets they got from accepting
multiply subsidized food imports.
Only when aid became competitive did the frame become open to ques-
tion. How can something as benecial as aid be competitive? However, it
was not the intellectual conundrum that caused the questioning. It was
practical and dangerous conicts between powerful states, initially the U.S.
and the European Community (as it was in the 1980s). Mounting domestic
food surpluses eventually appeared in Europe, because its domestic agri-
cultural policy was similar to the U.S. in key respects, and it started to try to
get rid of them in the same way. Competition between the two giants was
costly and verged on what came to look like trade wars. One of the goals of
the trade negotiations that began in 1986 was to reframe agriculture as
trade. They succeeded in 1995, when an Agreement on Agriculture became
part of the World Trade Organization (WTO). Now it is rarely denied that
export subsidies constitute dumping, and the word aid is less often used to
describe that practice. Aid has shifted to mean something done in emer-
gencies, and is usually assumed to be a gift.3
Naming is a way that social groups challenge specific features of a waning
regime. Naming emphasizes change rather than stability, in contrast to some
approaches to international regimes (e.g., Hopkins, 1980; Krasner, 1983),
and it does so in two ways. First, prolonged periods of confusion and
experimentation, as regimes unravel and alternative interpretations and
projects emerge, last as long as the regimes themselves. Second, regimes
appear less as static structures (Goodman & Watts, 1997) and more as
provisional compromises among some of the contending social actors, who
manage to create a new interpretive frame in common. The new regime is in
turn built on a historically specific set of relationships, which will over time
diverge from the implicit expectations of the frame. No compromise can

endure indefinitely.
Times of contention offer real choices of direction. More than one com-
promise is always possible. Social movements play a key role both in un-
folding crisis and in emerging relations of wealth and power. The emblem of
quality standards which is presently reconguring relations among social
movements, transnational corporate food supply chains, governments and
international organizations appears to be the basis for new and contending
frames, and thus for one of several possible new regimes. Before arguing
that a corporate-environmental food regime is emerging, I rst reinterpret
past food regimes with a focus on the social movements that shaped new
relations of power and inequality.
WORKERS AND FARMERS: SOCIAL MOVEMENTS

AND FOOD REGIMES
Each of the past two food regimes was the combined outcome of social
movements intersecting with state strategies and strategies of profit-seeking
corporations. Each regime unfolded for 2030 years, and so did the crisis
that followed each regime. New groups created by or in response to the old
regime workers in the rst regime, and farmers in the second organized
to pursue their goals or defend their perceived interests. Their search for
solutions entered into the compromises with powerful economic and polit-
ical actors to shape a successor regime. Of course, the new regime rarely had
all the results they had envisioned. Like states and corporations, social
movements are rarely careful about what they ask for.
Colonial-Diasporic Food Regime, 18701914
The colonial-diasporic food regime4 arose in the form of a world wheat

market, which was the rst price-setting market in basic subsistence good. It
emerged from a convergence of state policies in Europe and the European
diaspora. Governments in Europe, faced with popular unrest by labor,
anarchist, and socialist movements, were interested in promoting emigration
of troublemakers and import of cheap foods to pacify hungry citizens who
remained. England was the rst country intentionally to sacrice domes-
tic food security. It sacriced the interests of very powerful groups
landowners and capitalist farmers, who were unable to compete with cheap
imports in favor of social stability for industrial employers and growing

cities. Instead, they left to diasporic states the task of nancing the trans-
continental stage of the railways, along with shipping among the most dy-
namic capitalist sector of the era. Demand spurred rail, train, and ship
industries in England, and gave another boost to industrial profits.
Even as they sought autonomy from European rule, states in America,
Australia, and New Zealand embarked on projects to conquer territories
inhabited by indigenous peoples. To consolidate their hold, it was crucial to
link the conquered territories economically and culturally to Europe. After
violently evicting indigenous peoples, expanding European diasporic states
reorganized landscapes by imposing a grid of homesteads through rail-
ways and surveys (Crosby, 1986; Cronon, 2003, 1991). They recruited mi-
grants to use land in a way different from both the ways of indigenous
peoples and the ways of the European homeland. By organizing conquered
land into a grid of potential farms and recruiting Europeans to work on
them, Neo-European states secured territories culturally.5
Farmers recruited through the European diaspora were very different
from colonial elites in classical colonies, such as India. While the latter
found a variety of ways to mobilize the labor of colonial subjects, European
settlers were eeing economic deprivation and political persecution in
Europe. They intended to establish themselves as farmers and to stay. Far
from having colonial subjects to exploit, they were themselves vulnerable to
powerful interests, particularly the railways, who transported rst them and
then their commodities. European settlers, unfamiliar with farming in new
terrains or perhaps at all, grew what was asked by railways and merchants,
who wanted to ship wheat and livestock products back to England and the
rest of Europe. Settlers not only paid fares for themselves and their families,
but steadily paid freight charges for wheat. The dependence of settlers on
selling specialized wheat and livestock commodities via national railways
and ports to distant markets in Europe guaranteed their attachment to
expanding national economies and states.
Thus, a novel constellation of class and inter-state relations grew out of
the convergent interests of industrializing European states, pressed by social
unrest, and expanding states of the European diaspora. Working class
movements were a key driver of the late-19th century European diaspora.
Territorial expansion was a key driver of railway expansion and thus
European and international profits.
The food regime created a new class of farmers dependent on export
markets. Indeed, the central innovation of the colonial-diasporic food re-
gime was the fully commercial farm based on family labor. In contrast to
peasants, European diasporic settlers had to buy consumption goods and

tools and were compelled to sell their products, and therefore to specialize in
what was demanded. Their reliance on unpaid labor of men, women and
children exploitation of family labor allowed them to lower costs relative
to farms in England and elsewhere, including former export regions in
Eastern Europe. Despite notorious exploitation of agricultural laborers,
English farmers nonetheless did have to pay wages. Thus, a food regime
arose on the basis of family farmers specialized in a monocultural export
crop. Paradoxically, the triumph of wheat farms with unpaid family labor
underpinned the rst price-setting world market in a basic food staple.
The regime had the intended effect of reducing food costs to urban pop-
ulations in Europe. It unfolded through a downward spiral of falling prices,
crisis of European agriculture, leading to further immiseration and eviction
of small farmers and agricultural workers from the countryside, and a
complementary upward spiral of immigration to grain export regions in
North America, temperate South America, Australia, and New Zealand.
Thus, implicitly complementary policies of European and diasporic states
drove the emergence and unfolding of the rst international food regime.
Their convergent practices created classes of family farmers, which had
never existed in history, could exist only through international trade, and
would suffer most from a collapse of the regime.
Environmentally, the colonial-diasporic food regime promoted mining of
virgin soil, whose fertility (in the case of North America) was the outcome of
eons of use by indigenous peoples and bison. The soil erosion consistently
plaguing North American prairie farms can be traced back to the fragility
introduced by plowing perennial grasslands (Jackson, 1984), which for a
brief time (in geological measure) was able to yield crops with little labor or
renewal of nutrients. The regime converted vast grassland ecosystems into
neo-European landscapes(Crosby, 1986). These transformed landscapes,
which were later naturalized as the breadbaskets of the world, performed
apparent miracles. In place of the complex of perennial grasses, buffalo, and
indigenous societies partly through use of re (Pyne, 2001) which had
sustained a stable ecosystem European settlers introduced European
grasses and cattle (Cronon, 1991). These changes in the land (Cronon,
2003) led to soil depletion, and eventually water depletion, in the very area
on which large number of eaters across the ocean depended. It set the stage
for industrial monocultures, which arose in the second regime to cope with
environmental problems of the colonial-diasporic regime.
In contrast English High Farming, as it was called, was based on scien-
tific principles of agronomy designed to renew soils and even to maximize
long-term fertility. English farming, which went into precipitous decline

after 1870, had become scientific as well as capitalist in the preceding cen-
tury. High Farming has been called the most ecologically sophisticated and
energy efcient farming system ever known (Bayliss-Smith, 1982). There is
much to recover from its careful attention to recycling of nutrients, farm
scale, and other features of ecological farming (Duncan, 1996).
Crisis of the Colonial-Diasporic Food Regime: Legacies and

Alternative Possibilities
The colonial-diasporic food regime collapsed in world depression and ec-

ological catastrophe (in North America called the Dust Bowl) in the
1930s, only two generations after the rise of a wheat market. The key legacy
of the regime was a new type and significance of farm politics. The defunct
colonial-diasporic food regime left a class of wretched farmers concentrated
in export-dependent regions inappropriate for European crops and agron-
omy. Because of their non-capitalist structure, commercial family farms
responded perversely to falling prices (relative to economic models) by
growing more. Historic limits to price falls no longer held. Many farmers
had no choice but to leave the land and join the masses in search of work.
Their misery complemented that of the remaining peasants and farmers of
Europe. Surviving farmers formed or renewed political movements that
became significant in settler countries and in Europe.
A new type of farm politics, distinct from peasant movements in other
parts of the world,6 was a legacy of the unraveling settler-colonial food
regime. Farmer movements in the rising hegemonic power, the U.S., were to
shape the unusual features of a later regime, but only after a crisis lasting
through world economic depression and war between 1925 and 1945.
The actual conguration of the second food regime, which is the subject
of the next section, was not the only one possible, or even the one that
seemed most likely in the 1930s. First, in the rst regime, the U.S. was not a
dominant wheat exporter. The colonial-diasporic food regime created a
number of new export regions, among which the U.S. was far from dom-
inant. In fact, Punjab in the 1890s was seen by the US Department of
Agriculture as its most alarming competitor. Punjab was also a settler region
of the time, complete with wars (against Afghans), state-sponsored railways
and laying out farms, and recruitment of settlers to grow wheat for export to
Britain. Other newly colonized wheat export regions have also fallen from
memory, namely Siberia and the Danube Basin (Friedmann, 1978). Second,
European colonies (later the Third World) were not dependent on food
imports, but (despite variations due to climate and political changes)
were largely self-provisioning and occasionally exported surpluses.7 Third,
European diets were not spread into racialized colonies of rule. The legacy
of colonial interactions was culinary and agronomic diversity and creativity
rather than standardization (Friedmann, 2005).
During the Depression of the 1930s, unsalable wheat stocks coexisted
with hungry people. The problem was widely framed by governments during
the Depression as volatile agricultural markets, which led to price instability
for farmers and unstable supplies for consumers. The rst solution was
international, which seemed appropriate to the scale of the problem. Inter-
national commodity agreements committed governments to export and im-
port quantities within negotiated bands. Then during World War II, Allied
governments tightly coordinated food supplies, including domestic regula-
tion of agriculture for the war effort. Trade commitments during the War
were understood as preliminary to national economic plans after the War.
The latter reected widely shared commitments by governments to their
people to create what came to be named welfare states, including both a
minimum diet and farm stability. These took shape as a postwar plan for a
World Food Board. Commitments to export and import would guide do-
mestic economic plans.
Had wartime plans prevailed to create a World Food Board,8 the vic-
torious Allies would have made the Food and Agriculture Organization of
the United Nations into a powerful organization, authorized by leading
states to administer international agricultural commodity agreements. Yet,
the World Food Board proposal, designed by the U.S. and U.K., was de-
feated at a meeting in Washington, DC, in 1947, only 2 years after the end of
World War II, with the U.S. and Britain (under a Labour government)
voting against it. This was the lost alternative for a second food regime
(Friedmann, 1998).
The reasons for its defeat lie in a reframing of the interests of commercial
family farmers in the U.S. in such a way that domestic farm policy precluded
agreement to the World Food Board proposal. Other changes in 1947
shocked wartime agreement on postwar plans, but they do not account for
the shift in this plan. A massive rupture in Allied relations occurred in 1947,
when Cold War rivalry replaced cooperation between the West and the
Soviet Union. Since rivalry between blocs centered on competition over
delivery of high standards of living, including food, this might suggest a
revision of the Proposal to stabilize food and agriculture within the Free
World. Indebtedness of Britain to the U.S. for war loans marked a big
change in hegemony, and allowed U.S. position to carry more weight than
during the War. This explains why even a Labour Party delegation would
have bowed to U.S. pressure to abandon the World Food Board. The puzzle
remains why the U.S. should have reversed its policy regarding international
regulation of food and agriculture.
The key to the puzzle is the particular shape of U.S. domestic farm policies
during the Depression, which were continued into the postwar period and
which were to limit U.S. international commitments and thus shape interna-
tional trade and through them, domestic policies of other countries. U.S. farm
policy was not the only type developed during the Depression and World War
II. Among the many agricultural support programs created in various coun-
tries during the Depression, the one chosen was the only one that would result
in government held surplus stocks. The British system of deciency payments
had the advantages of transparency and non-trade-distortion to use phrases
current in the 21st century. The government set target incomes for farmers
and paid the difference between actual and target incomes out of general
revenues. No surpluses accumulated anywhere, and prices to consumers were
not affected. This form of subsidy was consistent with the World Food Board
proposal and with liberal international trade.
By contrast, U.S. farm policy was designed not to be transparent (what
were effectively subsidies were called loans) and to raise agricultural
prices rather than directly subsidizing farm incomes. An elaborate system of
government purchases removed enough wheat or other specied commod-
ities from the market to achieve target prices set by Congress. The result was
surpluses held by government agencies. These put downward pressure on
prices and therefore became self-perpetuating. They also required import
controls to prevent farmers from all over the world sending their grain to the
U.S., where prices were kept above world prices. This mercantile system of
domestic agricultural policy was the achievement of the farm organizations,
which were one of the three pillars of the New Deal coalition of the Dem-
ocratic Party in power during the last years of the Great Depression and
early postwar reconstruction.
Farm politics in the U.S., via emerging U.S. hegemony, led not only to
refusal of the World Food Board, but also to a set of practices that struc-
tured the second international food regime. U.S. farm subsidies, which were
unusual in their inconsistency with liberal trade, created the tail that wagged
U.S. policy dogs, not only in agriculture but more widely in international
trade agreements.9 Because it was the leading economic power, all the fea-
tures of the second food regime owed from protection and dispersal of U.S.
stocks. Domestic dispersal, which had begun during the Depression through
food stamps as a form of welfare payment in kind, continued after the

War but were far from adequate to the scale of the problem. Postwar mon-
etary rules, which replaced the defunct gold standard with a dollar-based
international system, allowed for a much larger outlet abroad in the form of
food aid. The most remarkable innovation of U.S. hegemony was aid
in the form of sales of U.S. goods for soft currencies held by the U.S.
government as counterpart funds. Food aid was such a large proportion
of all international agricultural shipments for two decades that it dened the
unique feature of the second international food regime, its state-led or
mercantile character.
Mercantile-Industrial Food Regime
For 25 years, the food regime that emerged after the defeat of the World
Food Board in 1947 framed what seemed natural about agriculture, food,
farm labor, land use, and international patterns of specialization and what
was loosely called trade. It unfolded as the expression of complementary
goals of states, rms, social classes and consumers, dramatically changed
patterns of international production and trade. Within the framework of
food aid, export subsidies became a dening feature of the emergent food
regime. It transformed the U.S. from one among many exporters in the rst
food regime, to a dominant exporter. It transformed Japan and the colonies
and new nations of the Third World from self-sufcient to importing coun-
tries. It transformed Europe from the dominant import region of the co-
lonial-diasporic food regime, to a self-sufcient and eventually major export
region. And it paradoxically framed the emergence of a number of giant
agrofood capitals, which eventually became powerful actors, whose interests
diverged from both farmers and national states. It did this through pro-
moting industrialization of agriculture and elaboration of manufactured
edible commodities sold by ever larger retail capitals.
The food regime of 19471973 can therefore be called mercantile-
industrial. Its mercantile and industrial aspects contrasted sharply with the
free trade and family labor of the earlier regime. The tensions among mer-
cantile policies, family farmers, and agrofood corporations were contained
for a quarter century as the food regime transformed ways of farming and of
eating in all parts of the world, starting with the U.S.
Diasporic farmer movements of the 1930s forced an agenda with an
unanticipated and unprecedented outcome. The diaspora that grew out
of labor strife in Europe in the 1800s experienced its own crisis, when
international wheat markets collapsed in the 1930s. Diasporic and European

farmers demanded protection from unstable international markets, and ag-
ricultural protection took many national forms. However, it was the specific
set of policies demanded by farmer movements in the U.S., which was the
emerging hegemon, which shaped the next food regime. Only the particular
ideology and political leverage of U.S. farmers can explain how the U.S.
would introduce a form of domestic farm subsidy that led to government
held surpluses and required import controls. When other states were con-
strained to adopt complementary domestic and trade policies, the whole
regime took on a mercantile character. This took shape through a shared
belief upheld in the GATT agreement that agricultural trade was
exceptional.
Subsidized exports were a key institution of the mercantile-industrial food
regime. Export subsidies originated and to some extent continue as
food aid. As a broader institutional innovation, foreign economic aid was
based on the unique role of the dollar under the Bretton Woods monetary
system. Most national currencies were not convertible to dollars, because
most countries did not have sufcient export capacity to earn dollars.
However, foreign aid allowed the U.S. to sell goods abroad in return for
inconvertible (or soft) currency of the import country.10 This was in-
tended to be temporary, to help countries develop export capacity so that
eventually they would earn hard currency. In Europe, the Marshall Plan
pioneered U.S. aid as a temporary and successful measure to rebuild
trading partners, and to wean European colonies from dependence on im-
perial trade in favor of dollars (Wood, 1986). When Public Law 480 applied
food aid in 1954 to underdeveloped countries the new definition of
those emerging from colonial rule it became the foundation of the mer-
cantile-industrial food regime.
As undisputed hegemon, the U.S. balanced its power and the wealth
which allowed it to protect its domestic policies with the vision to foster
complementary accommodations in the interests of other governments.
Subsidized exports elevated the rank of the U.S. to leading export nation,
and fostered a perception that it was somehow naturally a breadbasket.
European countries devastated by war accepted Marshall Aid for food, feed,
and fertilizer, which set major commodity crops, especially wheat and live-
stock, on a path to industrial farming on the U.S. model. That aid did yield
to commercial imports, especially feeds for intensive animal operations
(Friedmann, 1994). The shared vision of development as national indus-
trial growth encouraged Europe to agree to U.S. leadership even as their
empires dissolved. Equally important, it encouraged new states created
through anti-colonial struggles also to embrace U.S. leadership (Sachs,

1992; McMichael, 2004). (The Soviet bloc was separated from the west by
mutual trade embargoes.) As development was almost universally under-
stood to mean industrial growth,11 that embrace included subsidized wheat
imports from the U.S. For the Third World, however, aid did not yield to
commerce but to chronic import dependence.
Food aid shipments undermined agriculture in many traditional peasant
regions. Many could not compete with subsidized U.S. commodities. At
their peak, the U.S. wheat shipments under PL 480 constituted more than 40
percent of international shipments. While the U.S. had actively promoted
conversion to wheat diets in the early years, for instance in occupied Japan
after World War II, urban elites in the Third World often embraced wheat
as superior to local staples.12 Together, these contributed to large move-
ments of peasants to the cities.
However, neither growing dependence on food imports nor undermining
farm sectors were problematic for Third World governments. First of all,
within the frame of the food regime, aid shipments did not count as exports.
Second, and related, agriculture and food were framed as backdrops to the
main play, which was industrialization. The Third World governments
needed to get labor out of backward farming and into the anticipated
modern urban industries. Proletarianization was thus an explicit goal of
developing countries, as they came to be called (after underdeveloped
went out of fashion). Food aid helped in several ways. It substituted for
domestic food supplies, helped with patronage-based state-building after
independence from colonial rule, and forced people out of self-provisioning
and local markets. These were all good things for what McMichael (2004)
calls the Development Project.
Domestic food and agricultural policies in all parts of the world were
shaped by two factors. Externally, subsidized grain and other shipments put
a chronic downward pressure on world prices, even for non-recipients. Low
prices required protection in import countries with the clout and desire to
protect domestic agriculture, particularly Japan and European countries.
Low prices also hampered export competition even by other European di-
asporic exporters such as Canada and Argentina.
Internally, the U.S. modeled and supported major state involvement and
industrialization of agriculture. Governments in all parts of the world
adopted locally suitable versions of U.S. mercantile agricultural policies.
Both were encouraged by international development agencies during the
1950s and 1960s. In the Third World, industrialization of agriculture, called
the Green Revolution, increased grain production and as in the U.S. also
contributed to expulsion of farmers from the countryside. Japan, Britain,

and the European Economic Community all adopted farm subsidies that
were modied versions of the U.S. model (and eventually had surpluses of
their own). The Common Agricultural Policy of 1957 (with specific policies
dened in 1958) was the founding policy of European integration in the
Treaty of Rome. During the 1950s and 1960s, these mercantile policies
allowed for complementary national regulation of domestic farm sectors
and agricultural trade. And within these nationally regulated spaces, agri-
culture and food became reorganized into industries with their own tech-
nical dynamics and the source of large profits.
The mercantile regime was also, paradoxically, industrial. The colonial-
diasporic food regime had been led by merchant capitals, at least in agri-
culture; even railways took profits through shipping wheat and meat. In the
mercantile-industrial food regime, large industrial rms nally become
dominant within an increasingly specialized and integrated agrofood sector.
Some capitalist organizations grew up to supply agriculture with machinery,
chemicals, livestock feeds, veterinary medicines, and a variety of other in-
puts related to industrialization of agriculture. Others processed farm prod-
ucts as ingredients for evermore elaborate edible commodities. Still others
began the long road from small specialty stores and farmers markets to
giant supermarkets. These large capitalist rms sandwiched farmers between
them as buyers and sellers. Farm organizations began to talk of the cost-
price squeeze they faced between corporations with great market power.
On one side were corporate sellers of chemical and mechanical farm inputs,
and on the other buyers of crops and livestock as raw materials for further
processing.
Paradoxically, beneath the mercantile surface of trade rules, these rms
integrated production sectors transnationally. For example, the national
livestock sector of Holland, which depended on imports of industrial feed
grains from transnational suppliers, in a sense only appeared to be national
(Friedmann, 1994). Similarly, promotion of import substitution in the Third
World, for instance through the Green Revolution, actually substituted
grain import dependence for dependence on industrial inputs such as tube
wells and chemical fertilizers. In tandem with the growth and transnational
reach of agrofood corporations, farmers became ever more specialized.
Mixed crop and livestock operations, arguably important in many regions
for ecological sustainability, gave way to monocropped elds and factory
livestock operations. Agrofood corporations increased profits and control
by lengthening commodity supply chains. Particularly to supply consumer
demand for meat (a complex cultural phenomenon), monocropping of
maize and soybeans as feedstuffs became the basis for much farming in the
old diasporic regions. Farmers in the U.S. especially became larger and
more monocultural, fewer in number, more integrated into corporate con-
trolled supply chains, more dependent on subsidized exports, and in receipt
of a shrinking share of prices.
Four changes gradually came into conict with the practices and the
frame of the mercantile-industrial food regime. First, Third World coun-
tries (which came to be called the South with the demise of the Cold War)
were caught in a squeeze between import needs for basic foods and plum-
meting prices for the colonial exports they still depended on from the earlier
regime. Industrial or durable foods increasingly found substitutes for
sugar and tropical oils, which were among the most important. As reference
to any ingredient label will attest, sugars have been replaced by a variety of
sweeteners, including chemicals such as aspartame, and industrial by-
products such as high fructose corn syrup (which also benets from U.S.
government subsidies). Second, corporate reorganization of commodity
chains accelerated the declining numbers and political resources of farmers,
and farm lobbies came to reect growing corporate presence even in
farming. Third, transnational corporations found themselves constrained by
the mercantile trading rules and domestic subsidies of the regime, and sup-
ported moves to liberalize trade.
Detente between the U.S. and the Soviet Union in the early 1970s revealed
the fourth, deeply implicit framework for the mercantile-industrial food
regime: the mutual trade embargo between Cold War blocs. The capitalist
bloc had acted as a dam containing agrofood trade and aid. Surpluses
accumulated behind the dam and had to be disposed of within it. Surplus
disposal was key to the dynamics of the regime. The regime would cease to
exist without surpluses and non-market subsidized exports that worked
for both sender and recipient.
Yet, the regime was not visible as such, and surpluses simply presented
themselves as a chronic problem. The U.S. saw an opportunity to sell off its
surpluses for hard currency and at the same time shift geopolitical alliances
through Detente with the Soviet Union in 1972 and 1973. The Soviet
American grain deals of those years were so huge that they cleared surplus
stocks for the rst time since World War II. They caused the price of wheat
and other grains and oilseeds to more than triple. Food aid and even some
commercial contracts crucially a sale of soybeans to Japan were sus-
pended. Food import-dependent countries of the global South, which also
faced soaring energy prices in the same years, began to borrow from pri-
vate banks. The U.S. consumers outraged at the high meat prices started
boycotts. Farmers enraged at being closed out of a share of the high prices,
which were captured by trading corporations, put intense pressure on Con-
gress. The regime fell into an acknowledged though rarely remembered
World Food Crisis in 1974.
Crisis of the Mercantile-Industrial Food Regime: Reframing Trade
The World Food Summit of 1974 began to reveal the frame of the mer-
cantile-industrial food regime. It was called by the Food and Agriculture
Organization in Rome. The FAO, which had been marginal to the operation
of the regime, had (like many specialized United Nations agencies) devoted
its energies to hunger and peasant agriculture in the Third World. Suddenly,
billions of people were dened as food insecure by the disappearance of
U.S. surplus stocks and surge in world grain prices. The initial response was
not to question whether markets themselves might increase vulnerability
despite the lessons of the crisis of the 1930s. It was to frame the problem as
hunger, that is, people lacking food. At the rst World Food Summit gov-
ernments declared an inalienable right to be free from hunger and mal-
nutrition, and committed themselves to achieving this right universally by
1984 (FAO, 1996; Friedmann, 2004). The Summit created the World Food
Council to upgrade the desultory activities of the World Food Program, the
International Fund for Agricultural Development and the FAO Committee
on World Food Security. The language of food security and right to
food emerged from this moment. While the right to food was already
mentioned in the 1948 Universal Declaration of Human Rights (Alston,
1994, pp. 206207), food security named the absence of an automatic con-
nection between meeting needs and agricultural production, which had been
implicit in the regime frame (Lacy & Busch, 1984).
As hunger increased, export subsidies were no longer disguised. First, the aid
became reframed as inconsistent with subsidized exports. Bilateral U.S. con-
cessional ows dried up after the Soviet sales. Multilateral food aid institu-
tions were upgraded. European aid expanded. A newly enriched Organization
of Petroleum Exporting Countries began to use its oil revenues to give its own
aid. Food aid came to be understood more explicitly as either humanitarian
or an extension of foreign policy. Congress changed the U.S. food aid leg-
islation to emphasize grants rather than concessional sales in the wake of
revelations that allocations had been illegally redirected to the war in Vietnam.
Second, export subsidies became dangerously competitive. Once named,
they led to formal attempts to include agriculture in trade agreements.
European surpluses, predictably generated by a parallel system of domestic

agricultural price subsidies, had also led to subsidized exports. By the
1980s, competitive export subsidies led to a near trade war between Europe
and the U.S. Their interest was to resolve this mutually destructive com-
petition. At the same time, second rank exporters led by Argentina,
Canada, and Australia formed the Cairns Group to press for an end to
mercantile practices. New exporters of grains and soy for industrial live-
stock, notably Brazil, joined the effort (Friedmann, 1994). These govern-
ments had not been able to afford to subsidize their own exports,13 and
expected that an end to mercantile practices would nally give them a fair
share of world exports. The major countries of what came to be called the
North, therefore, agreed to try to include agriculture within trade agree-
ments in the GATT negotiations that began in 1986. This shift was sup-
ported (somewhat ambivalently at rst) by agrofood industries, which had
come to experience as restrictive the mercantile framework that had nur-
tured their growth for more than three decades. The effort got momentum
from the collapse of the Soviet bloc and the rapid privatization of assets in
each country. The WTO was created in 1995, complete with an historic
Agreement on Agriculture.
The mercantile-industrial food regime was over. Interests in the old re-
gime died hard, however. The U.S. was hooked on grain exports, and its
trade deficit was growing. Japan and Europe had large constituencies that
dened food security as domestic sufciency, and active farm lobbies. Mer-
cantile trade practices did not end, nor did domestic farm subsidies. Al-
though the North, especially through the Group of Seven industrial
governments, made great strides in reframing the issue from hunger to
trade,14 the Agreement on Agriculture of the WTO remained very much an
agreement in principle.
Farm lobbies supposedly prevented powerful governments from meet-
ing their commitments to end domestic and export subsidies. Farm lobbies
in the North were pillars of the unraveling mercantile-industrial food re-
gime. Yet, the inuence of farm organizations on national policies, which
seemed formidable in the 1980s and 1990s, ultimately rested on a fragile
social base. The number of farmers had fallen to a tiny percentage of the
population because of the very success of the regime price supports re-
warded larger farms, and industrialization of agriculture subordinated
farmers to large agricultural input and food-processing rms.
The interests of farmers (and as we shall see, consumers) became less
monolithic as the regime unraveled. The U.S., despite increasing farm
subsidies to unprecedented levels, was increasingly committed to policies,
such as promotion of genetically modied seeds, which intensied concen-

tration of industry power and farm size. Meanwhile, eld crops had become
concentrated in livestock feed grains, for both domestic and export oper-
ations. Domestic U.S. grain prices continued to fall, beneting increasingly
concentrated livestock capitals. Some grain farmers recognized that they
were no longer helped by domestic subsidies, and began to identify a shared
interest with farmers abroad, who continued to be hurt by the low U.S.
prices. They advocated for a mix of measures to raise domestic prices (Ray,
De La Torre Ugarte, & Tiller, 2003). However, the most vocal and inu-
ential voices in the ofcial U.S. farm lobbies, which represented the largest
actors interested in each specialized commodity, had become those of
agribusiness. They beneted from increasing U.S. subsidies while opposing
subsidies in international organizations.
The EU began to shift in the direction of non-trade distorting subsidies
under the rubric of multifunctionality. This meant that farm subsidies
would be redirected toward specific environmental, landscape preservation,
rural community, and other services by farmers and away from com-
modity-specific subsidies. Yet, this policy was largely a tactic in negotiations
with the U.S. It was designed with environmental organizations rather than
farm organizations, and not particularly welcomed by farmers (Vihinen,
2004). Nonetheless, multifunctionality was a dramatic reframing of agri-
culture. As we shall see, it got extra purchase from food safety scares, which
rocked consumer condence in industrial agriculture. It opened new spaces
in Europe, and intersected with new possibilities for reframing food and
agriculture in other parts of the world.
By 2003, Europe and the U.S. still had not resolved their disagreements
but found a new solidarity in face of a coherent challenge by countries of the
South. In that year a coalition of leading governments of the South walked
out of the WTO talks because the North remained intransigent over ag-
ricultural subsidies, both domestic and export. The three countries that led
the 2003 coalition had emerged from marginal roles prior to 1974. Brazil
had become a leading competitor, especially in soy exports. India shifted
from leading recipient of U.S. food aid to more or less self-provisioning.
China shifted from isolation to embrace Western seeds and techniques to
industrialize agriculture. If the North does accede to the demands of the
South, however, the results may not be as hoped by any of the protagonists.
Abolishing subsidies cannot bring a new regime.
Two dominant, opposing positions remain locked into the productivist
frame of the old regime. The rst response to high food prices in 1974 was
universal confusion about how such a reversal of development could have
happened and framed hunger as the problem. The question was whether
redistribution or increasing supply was the solution. Advocates of the right
to food focused on income redistribution to widen access to commercial
food. The attention to redistribution had indeed been the alternative to
neoliberalism, which was particularly promoted by the G7, and would have
applied not only to social classes but also to rules creating greater equality
between North and South.15 But the 1980s and 1990s saw the triumph of
neoliberal policies centered on trade and nance. Advocates of free trade
pinned hopes on technological change, now including genetic technologies
(Runge, Senauer, Pardey, & Rosegrant, 2003).
As the trajectory of crisis in the global South followed the shift from
hunger to trade, farmer movements and land reform came to the fore. In the
South, significant social movements have arisen among farmers facing dev-
astation from subsidized North imports and enforced reorientation of do-
mestic agriculture toward exports to make government debt payments. They
have pressed governments to take a stand at the WTO. Farm movements are
also pressing governments to redistribute land, such as the Landless Move-
ment in Brazil; to protect them against new threats from intellectual prop-
erty claims on seeds, typical of several movements in India; and resist the
pressure to redirect agriculture toward export crops to the North instead of
food production.
Farm movements became international. A transnational network of farm
organizations called Via Campesina was founded at a 1993 meeting in
Mons, Belgium of 55 peasant and farmer organizations from 36 countries.
This reframed farmers and peasants of North and South as one group,
people of the elds. It has grown quickly in its rst decade, in both
numbers and sophistication. Via Campesina was the culmination of national
and cross-border organizing in the Americas, Europe, and Asia to oppose
regional and international free-trade agreements (Edelman, 2003). Non-
governmental organizations and social movements had mounted increas-
ingly large and lively parallel summits to many international organizations,
including the World Food Summits between 1974 and 2002. Demonstra-
tions opposing trade agreements, beginning with the Canada-US trade
agreement of 1989 and extending to the North American Free Trade
Agreement in 1994 and the WTO in 1999, exposed farmers and their sup-
porters to international perspectives. Analytical and strategic discussions
evolved into the Agricultural Forum parallel to the Summit of the Americas
in Quebec City, Canada, in 2001, and broadened to reframe issues. Cultural
and biological diversity, gender equality, dietary effects on health, ecological
effects of farming systems, appropriate technologies, farmers knowledge,
and fair trade, joined classical issues of farmers rights, land reform, ag-
ricultural labor, hunger, and social justice in the World Social Forums in
Porto Alegre, Brazil and Mumbai, India, and then in the regional social fora
it spun off (Friedmann, 2002). From these gatherings emerged a rough
consensus on a reframing concept: food sovereignty.16
Between 1974 and the turn of the century, old institutions had ceased to
work as before or especially in the South even to exist. Changes in food
aid, farm subsidies and marketing boards, and consumer food subsidies led
to a panoply of contests over how to reframe issues. These contests, how-
ever, took place in the midst of a wider loss of condence in many parts of
the world in the merits of the agrofood system created by the mercantile-
industrial food regime. A new regime seems to be emerging not from at-
tempts to restore elements of the past, but from a range of cross-cutting
alliances and issues linking food and agriculture to new issues. These include
quality, safety, biological and cultural diversity, intellectual property, an-
imal welfare, environmental pollution, energy use, and gender and racial
inequalities. The most important of these fall under the broad category of
environment.
ANTECEDENTS TO GREEN CAPITALISM
New issues brought food and agriculture, which had been marginal to public
consciousness and administered by separate branches of government, to a
contentious center in the politics of the North. Environmental criticism of
industrial agriculture began at the pinnacle of the mercantile-industrial food
regime. Rachel Carsons Silent Spring, often credited with launching the
environmental movement in the U.S., documented the effects of pesticides
on what later came to be called biological diversity. Yet, agriculture was
far from the center of early environmental institutions. Air pollution was the
rst unifying issue of newly created national environmental ministries in the
years after the rst international conference on the environment in Stock-
holm in 1972. However, in the 1960s and 1970s, concerns about food ad-
ditives and pesticide residues came to the fore. As more consumers were
supplied by the industrial food system in the 1980s and 1990s, environ-
mental and consumer movements took up issues related to food safety and
food quality in response to outbreaks of diseases such as E. coli and BSE.
Challenges to industrial agrofood practices also arose from animal rights
activists. A large international movement opposed genetically engineered
seeds, which were announced and rapidly introduced into maize and soy
elds around the world in the 1990s.
Organic and local farms, which had begun to experiment with agro-
ecology and a revival of cooking during the 1960s and 1970s, were always
interesting to large food corporations. A game of naming played out around
the terms natural, health, and organic. Corporate manufacturers (and later
fast-food corporations) rightly considered the terms an implicit criticism of
their own products as unnatural, unhealthy, and not organic (often chem-
ical). At the same time, they were alert to market trends. A massive wave of
mergers and consolidations swept the U.S. and the world in the 1980s. Some
of the new giants, such as Beatrice Foods and General Foods, purchased
some of the more successful alternative food producers in California and
integrated their product lines to supply the growing network of health
food stores across the continent. Retail corporations, whose power in the
food system grew in tandem with increasing consumer anxieties, developed
their own brands, which often claimed to raise quality and environmental
standards, even as they displaced brand loyalty to old manufacturing cor-
porations. These early experiments with niche product lines allowed cor-
porate brands to appropriate the words healthy and natural, which came to
adorn even the most extraordinarily reconstituted edible commodities. In-
deed, at the end of the trend, candy bars with vitamins added are sold as
functional foods claimed to promote health better than freshly prepared
balanced meals.
Organic, however, was more sensitive because it related to farming.
Farmers and farm lobbies joined agribusiness interests in rejecting the crit-
icism of chemical-intensive industrial farming. As the sector grew in re-
sponse to demand, certication became a complex political issue, both
among farmers and at various levels of government. By the time it began to
be resolved nationally in the 1990s (Guthman, 2004), international conicts
over food safety, including farm techniques, had become part of trade con-
icts. The European Union and Japan refused imports of products from
livestock treated with hormones and genetically modied foods and seeds.
The conict with exporting countries the U.S. and the new Cairns Group
at the WTO overlapped with trade conicts already described in previous
sections.
In the South, the mercantile-industrial food regime had brought the
Green Revolution and industrial agriculture. It simplied agro-ecosystems
to increase production of basic food staples, such as rice in Asia and po-
tatoes in the Andes. It marginalized rural communities based on mixed
farming cultures and threatened loss of both indigenous cultivars and
knowledge. The crisis of the mercantile-industrial food regime reversed this

classical project of import substitution via industrial farming. International
pressure to collect debts, which consolidated under the term structural
adjustment in the 1980s, insisted on shifting to exports and removing gov-
ernment regulation, especially farm and food subsidies, and import restric-
tions. In many places, agriculture shifted from domestic food production to
non-traditional exports such as fruits, vegetables, and owers (as well as
re-emphasizing traditional exports of coffee, sugar, and other tropical
crops introduced by the colonial-diasporic food regime). Cattle production
moved into tropical forest ecosystems to provide beef for industrial chains
extending to cooked hamburgers. Social movements arose that linked clas-
sical issues of land, labor, and livelihood to new ones: displacement of
indigenous peoples, protection of indigenous knowledge and cultivars, and
agroecology (McMichael, 2005b).
By 2001, when the rst World Social Forum brought together social
movements from North and South, common understandings began to
emerge of the inter-relationships among biological and cultural diversity and
the threat posed by industrial farming. In North and South, experiments
proliferate in growing food in ecologically sensitive ways and relinking
consumption in municipal regions and protecting, reviving or creating re-
gional food cultures. The Slow Food movement creates convivia to
revive ecological and pleasurable eating, and more recently presidia to
protect the diversity of cultivars, livestock, and local techniques. Indigenous
farmers are playing increasingly effective roles in the larger movement of
small farmers in Via Campesina.17 Building on several decades of interna-
tional feminist dialogues, women play a large and self-conscious role in
many of these movements. If the past is a guide, some of the demands of
these movements will inspire a new food regime and partly shape it, prob-
ably with unexpected results (Friedmann, 2001). In the wings, capital is ever
ready to appropriate what works.
LINEAMENTS OF A CORPORATE-ENVIRONMENTAL
FOOD REGIME
A convergence of environmental politics and retail-led reorganization of
food supply chains suggests the emergence of a corporate-environmental food
regime. The emergent regime, as I see it, consists of two differentiated ways
of organizing food supply chains, roughly corresponding to increasingly
transnational classes of rich and poor consumers. Both are led by private
capitals, sometimes the same rms selling quality and cheap commodities to
different classes of consumers. In the U.S., the two supermarket chains
dening the two class markets are Whole Foods (a stunning appropriation
of a 1960s counter-cultural term)18 and Walmart. In Europe, by contrast, a
single consortium coordinates a massive transnational organization of qual-
ity audited supply chains; however, the fact that these are constructed by
private capitals, and not by government policies, opens the door to Walmart
or small entrepreneurs catering to low-income consumers in the future.
While the U.S. and Europe remain the largest markets, the rise of privileged
consumers in large countries of the global South and China, and the reach
of agricultural supply chains into the elds of the global South, raise ques-
tions about new articulations between interstate relations and agricultural
land and labor.
The lead by private capitals is the outcome of a continuing impasse
among governments of the North in international organizations. Although
the WTO Agreement on Agriculture in 1995 reected the determination of
the EU and U.S. (and other powerful states) to resolve their trade disputes,
these had already been overtaken by food standards issues.19 These were to
be negotiated in Codex Alimentarius, a joint committee of the World Health
Organization and the Food and Agriculture Organization, which after 1995
would be enforceable by a WTO disputes tribunal. Whether specific San-
itary and Phyto-Sanitary measures by national states were to be treated as
hidden import restrictions was to be arbitrated through governmental chal-
lenges brought to the new WTO tribunal. The U.S. successfully challenged
EU rules banning any beef treated with hormones, resulting in annual pen-
alties of $180,000,000. In this context, the EU decision not to renew its
moratorium on genetically modied foods which pitted wide public sup-
port against intransigent opposition by export governments was made in
the shadow of a threatened U.S. challenge. The decision indicates accept-
ance of a different conguration; public standards will be lower, as the EU
drops its international insistence on higher standards, but new measures,
particularly traceability, support private sector initiatives to negotiate and
enforce their own, higher than public standards.
Pressure to yield national standards to trade agreements is amplied by
the pressure for the North to present a unied front against a resurgent
South. The rst crisis of the WTO in 1999 in Seattle simply delayed ne-
gotiations on an Agreement on Agriculture. The second crisis came in
Cancun in 2003, when major governments of the South vetoed further con-
cessions until the North met its existing commitments on subsidies. Within 4
years, the main cleavage had shifted from U.S.EU to NorthSouth. Con-
icts over national standards would not be easy to resolve at the WTO.
Action has quietly moved to private capital. Regulation has historically
helped food manufacturers by creating trust among consumers and clear
rules for producers. The question is whether transnational agrofood cor-
porations can effectively regulate themselves. I once answered in negative
(Friedmann, 1994). Now I can qualify that answer. They have the capacity
to organize supply chains that cross many national borders as private
transnational supply chains, and to create, enforce, and audit (govern-
ments would call it inspect) producers, shippers, and handlers along the
chain. Yet, they still need inter-governmental standards to set a oor for
their activities. Thus, in contrast to the 19th century national regulation,
which forced private interests to raise standards above what the market
allowed, the quality commodities offered to privileged consumers are
being constructed above the oor set by international organizations.
Governments of North and South are for different reasons embracing
minimal inter-governmental standards. As the EU drops its state-level com-
mitment to specific quality standards such as hormone-free animal prod-
ucts and ban on genetically modied foods, it abandons government
standards as public and universal. Instead, private capitals, which operate
outside the jurisdiction of inter-state agreements, create their own carefully
regulated supply chains containing just those higher standards that cannot
be sustained in inter-governmental negotiations. Of course, the lower public
sector standard invites importation and even local production of commod-
ities meeting minimal standards for low-end consumers. Supply chains for
both quality and minimal standard commodities cross many and changing
frontiers. They are supported by uniform inter-governmental standards even
when private audits require additional standards. As a result, faltering in-
ternational organizations, including the WTO, are being outanked by pri-
vate transformations of agrofood supply chains in response to social
movements of consumers, environmentalists, and others.
There were national precedents for a new conguration of public and pri-
vate standards. In the 1980s and 1990s, U.S. national controversies over public
certication of organics pitted large-scale corporate growers against ad-
herents to holistic principles from which the term derived in the 1970s.
Increasing market opportunities had attracted farmers with little commitment
to principles of the social movement, with regard either to ecosystem integrity
or even less to labor standards (Guthman, 2004, pp. 5153). Moreover, the
proliferation of certication bodies created confusion, and in the face of inter-
governmental failures to resolve it, corporations began to shift the terrain.
Corporate supply chains, more than social movement supply chains they
appropriated, depend on some kind of certication. According to Raynolds
(2003, p. 737), The rising importance of mainstream retailers and food
corporation in Northern organic markets is reinforcing the position of big
producers in Latin America able to guarantee large continuous supplies of
standardized goods. The standards applied by corporate supply chains are
an elaborate set of specications applied to all links in the chain, abstracting
from local environmental (and labor) conditions that originally informed
organic and fair trade movements. They press against the small producers
and trade organizations still adhering to those principles. Campbell (2004,
Campbell & Coombe, 1999) calls this a form of green protectionism by
the North, forcing higher national standards, e.g., in New Zealand, to give
way to those dictated by private supply chains ending in rich Northern
consumers.
Corporations have selectively responded to consumer demand (a priva-
tized expression of demands by health and environmental movements) with
audited supply chains delivering identity preservation and traceability
from seed (or embryo) to plate. Thus, U.S.-based Cargill corporation is
reorganizing to contract for specialty audited lines of formerly standard
products. A recent innovation is to sell off its Brazilian subsidiaries that
grew oranges and processed them into frozen orange juice. Instead, it is
contracting Brazilian companies Citrosuco and Cutrale to supply oranges
with specific characteristics, such as those picked from a tree with a certain
age, comparing the taste differences to those among grapevines. It is sim-
ilarly investing in ingredients for functional foods, claimed to offer spe-
cifically engineered health effects. Cargill is selling a product called
CoroWise, made from plant sterols that might help reduce cholesterol.20
A more far-reaching innovation has emerged in Europe, where public
consensus could not result in public policy because of Cairns Group and
U.S. intransigence at the WTO. By 1999, private capitals in Europe, an-
ticipating the imminent expiration of the ban on genetically modied foods
yet perceiving that consumers would continue to want a guarantee of
quality, organized an innovative consortium of private retailers, manu-
facturers, private certifying bodies, and others representing perceived
consumer interests, to negotiate their own quality standards. Led by su-
permarket chains, EUREP-GAP (Euro-Retailer Produce Working Group-
Good Agricultural Practice) is a consortium of enterprises including food
manufacturers, restaurant and catering chains, and credentialing and au-
diting bodies, that requires documentation at every stage of production and
transport that an elaborate set of rules has been followed. EUREP-GAP sets
standards according to their own interpretation of social movement issues.

The website states:
In responding to the demands of consumers, retailers and their global suppliers have
created and implemented a series of sector specific farm certication standards. The aim
is to ensure integrity, transparency and harmonisation of global agricultural standards.
This includes the requirements for safe food that is produced respecting worker health,
safety and welfare, environmental and animal welfare issues.21
Yet, this combination of basic public regulation underpinning higher private

standards differentiates citizens all of whom benet equally from public
regulation into consumers only some of whom can afford expensive
quality standards. Neither the industrial food system nor the growing num-
bers of poor are going away; indeed, standard edible commodities are pro-
duced by some of the same corporations involved in constructing quality
audited food chains. For example, both Codex Alimentarius and EUREP-
GAP are now deciding standards for animal production, including feeds for
intensive livestock. If Codex allows genetically modied feed grains (espe-
cially if it permits no labeling), while EUREP-GAP requires audits guar-
anteeing use of GM-free feeds, the combination of public and private
standards would create conditions for distinct rich and poor supply
chains in animal products.
The new mix of private and inter-governmental regulation will have sig-
nificant effects on inter-state power. Private power may weaken rival na-
tional farm lobbies. Whatever mix of residual popular strength and large
corporate inuence keeps U.S. farm lobbies together, they are likely to
fragment in face of EUREP-GAP temptations. If European retailers were to
offer premium prices for, say, beef fed with non-genetically modied feeds,
some U.S. farmers would likely respond. They would therefore increase
demand for segregated, identity-preserved feeds. Segregated supply chains
for organic soy already exist. Thus, intransigent U.S. and Cairns Group
refusal to be required to segregate by international bodies22 would no longer
be bolstered by a solidary farm bloc. EUREP holds training workshops for
auditors all over the world, including the U.S.
The third food regime also takes place against the backdrop of declining
U.S. hegemony. One mechanism of decline, which I documented elsewhere
(Friedmann, 1994), is that rising states are able to be exible while hegemons
are locked in to existing investments, geographies, alliances, and institu-
tions. In the early stages of crisis in the late 1970s, Brazil and Japan formed
a new trade link that shifted patterns in the mercantile-industrial food re-
gime and made Brazil a major exporter. The form of investment was also
distinct, consisting of joint ventures with both states and national capitals,
and locating soy processing in Brazil. Similarly, EUREP represents an in-
novative approach to international supply chains and quality assurance that
is likely to put its members at an advantage relative to U.S. corporations.
While U.S. Department of Agriculture inspectors enforce quality standards,
for instance in the booming export region of Sao Francisco in Brazil, by
locating government inspectors at the port, EUREP requires each rm in
the supply chain to document (and invest in labor, equipment, and organ-
ization) every stage of the life and travel of each mango, and trains auditors
to check (Cavalcanti, 2004). The detail of the U.S. standards is consequently
lower, and Whole Foods, for example, has to arrange its own quality audits
for a much smaller supply chain.
As emerging power (perhaps even eventual hegemonic successor), China
has already had massive effects. Vast plantings of genetically modied soy-
beans (and cotton) took place in a short time, giving China a boost in the
latest phase of industrial agriculture and undermining international efforts
to oppose GM crops. Chinas imports of GM soybeans gave Argentina an
option to the European and Japanese markets, which resisted GM soy
throughout the 1990s. The Chinese outlet, plus smuggling of outlawed seeds
across the border, undermined Brazils ban on GM crops, which has since
expired. On the quality side, China has developed an entire exotic sector of
tomatoes, which it exports as paste (Pritchard & Burch, 2003). As Chinas
proportionally small, but absolutely large class of privileged consumers
emerges, it is likely that it will affect quality supply chains as well.23
The South has been the laboratory for elements of the corporate-
environmental food regime. Structural adjustment policies, which system-
atically attacked all aspects of the state-centered development in universal
favor until the 1970s, paved the way for both global markets in edible
commodities and transnational quality supply chains. Exports of fresh fruits
and vegetables and of livestock products have been well established in many
countries. Increasingly centralized private supply chains set national and
local regions in competition with each other to sell mangoes or green beans.
Some areas are now emerging as major quality export sites, such as North-
eastern Brazil, South Africa, and New Zealand.
At the same time, as sites get locked in through elaborate technologies of
quality control and documentation, their bargaining power may increase.
Quality requirements, which selectively take up fair trade and other social
justice and environmental demands, actually meet some of the old demands
for development. For instance, documentation requires that agricultural
workers be literate, and upgrades what have been marginal occupations. Yet,
in the short run it means that a tractor driver, who cannot write, or work
with computers, loses his job. Social justice requirements can include hiring a
proportion of women, which is a good thing, but the standard format and
external authority may play havoc with local social and family relations.24
National states continue to play a key role in regulating food and ag-
riculture private capital alone cannot regulate conditions of production,
such as land use and labor markets, or of consumption, such as food safety.
As agrofood systems restructure transnationally, international organiza-
tions such as the WTO and UN institutions are proving indispensable even
as their role is subordinated to the private sector. International rules will
determine standards in governments of the South to the extent that na-
tional regulatory capacity allows for enforcement. Challenges to inequality
among states are directed not to private corporations or consortia, but to
Codex Alimentarius. This already burdened international organization is
thus trying to take on the burden through a trust fund to which qualied
governments of the South may apply for relatively small sums of money to
help them develop capacity to administer international standards.
Even if some labor standards improve, both quality and standard com-
modities deepen longstanding processes that dispossess and marginalize
peasants and agrarian communities, and create more poor consumers and
more people without stable incomes to consume at all. Workers in large
agricultural export operations in northern Mexico do not easily nd ways to
grow or buy either the tomatoes they produce for export or the beans and
corn they once grew or bought in local markets (Barndt, 2002). They are now
switching not to commercial burritos (a traditional meal of corn and beans)
but to manufactured Chinese soups.25 It is unlikely that the vast majority
of Chinese rapidly entering food markets will demand or be offered qual-
ity foods of the kind organized by EUREP-GAP, at least for a long time. At
the same time, EUREP-GAP includes MacDonalds of Germany. As long as
income inequality remains the same or worsens, cuisines of the poor are
likely to be based on standard edible commodities. While the rise of qual-
ity agrofood systems may herald a new green capitalism, it may serve
only privileged consumers within a food regime rife with new contradictions.
NO CONCLUSION: THE CONTEST CONTINUES

The emerging corporate-environmental food regime is already contested by
the very movements it draws on, because many health and environmental
problems, and most social problems, cannot be reduced to consumer
demand. In place of a conclusion, I offer some speculative forays into how

my picture of global restructuring of capital and classes ts with Lang and
Heasmans (2004) analysis of conicting paradigms for the future of food.
These paradigms help to interpret initial, promising moves by social and
environmental movements, whose projects are being appropriated and dis-
torted by powerful capitals and states.
Lang and Heasman name the industrial aspect of mercantile-industrial
food as a Productionist paradigm. It is dying. Two paradigms are vying
to succeed it. Each offers distinct and opposing solutions to inherited health
and environmental problems. The Life Sciences Integrated paradigm fo-
cuses on individual disease predispositions and crop characteristics, and
privileges the biochemical, genetic approach linking specialized sciences with
centralized industries. The Ecologically Integrated paradigm, by contrast,
builds on the holistic science of ecosystems and human health, and asserts
an intrinsic link between the two. It elevates the public sector, which is the
way that citizens manage their collective needs.
The mercantile aspect of the dying food regime invites us to interpret the
two paradigms on a global scale. The Life Sciences Integrated paradigm
offers engineered foods containing vitamins and other synthetic nutrients.
These will complement the distinct foods offered to high- and low-end con-
sumers. Plants and animals engineered to require fewer environmentally
dangerous chemicals and toxins (so far, more have been engineered to tol-
erate larger doses of herbicides) are designed to improve productivity to feed
low-end consumers. And bureaucratically organized and centrally moni-
tored corporate supply chains transform selected aspects of the ecological
model into transnationally sourced high-end commodities. The corporate-
environmental food regime encapsulates two distinct corporate strategies for
privileged and cash-poor customers across the globe. Therefore, the dis-
tinction between fresh, relatively unprocessed, and low-chemical input
products on one side, and highly engineered edible commodities composed
of denatured and recombined ingredients on the other, describes two com-
plementary systems within a single emerging food regime.
My analysis of the emerging corporate-environmental food regime sug-
gests interpreting the Ecologically Integrated paradigm at multiple scales,
including the global. Lang and Heasmans concept of ecological public
health names an emergent project to reclaim political spaces within which
citizens relate to one another and to the places they inhabit in common. This
can already be seen at all levels of scale, from municipal food security
projects in tension with transnational supply chains, to international or-
ganizations in tension with one another and with private rms over the
relative weight of environmental (and health) versus trade concerns in

regulating agrofood relations. Social movements are already regrouping in a
variety of ways from the Food Alliance in the U.S. which brands eco-
logically sensitive, regional foods, to the Slow Food Foundation for Bio-
diversity, which creates a global network for private groups and local
governments to brand typical products, and to develop and exchange their
seeds and skills.26 Both reassert the deeper meanings of agroecology and
community in ways that do not reject markets but rather seek to multiply
niches as an alternative strategy to expansion of one set of products and
procedures at the expense of all others (Fonte & Boccia, 2004).
The tension at the heart of the emerging corporate-environmental food
regime is thus coming into view: states, rms, social movements, and citizens
are entering a new political era characterized by a struggle over the relative
weight of private, public, and self-organized institutions. The key issue,
therefore, for food and agriculture, and for reshaping governance at all
scales, is democracy. That implies rethinking the meaning of public. Eco-
logical public health must encompass the biosphere. An unequal contest is
under way over the restructuring international institutions. Whether there
will be a public sphere at the global level depends in part on the outcome of
struggles between governments and non-governmental organizations pro-
moting the Life Sciences Integrated paradigm, and those promoting the
Ecologically Integrated paradigm. It is not known how irreparable is the
damage to human and ecosystem health and environment of the mercantile-
industrial food regime, nor whether it can be corrected or will be worsened
by the emerging corporate-environmental food regime. The unfolding of
another hierarchical regime based on accumulation of capital may not be
the only, necessary, or even stable future. Integrated networks may offer a
democratic and sustainable alternative. Much depends on whether and how
democracy can nd cosmopolitan27 expression.
NOTES
1. Earlier markets in sugar, coffee, tea, etc. reshaped vast agro-ecosystems, labor
systems, cultures, and diets, and their legacies are part of the story. See the oeuvre of
Sidney Mintz, e.g. (1985). However, the point of entry is after the expansion of
European rule and cultures, including transformation of exotic landscapes and diets
according to European ideas and practices, to the period of price-setting world
markets in wheat and other settler foods (Friedmann, 1978; Cronon, 1991).
2. Of course, the social movement literature focuses on how movements frame
grievances about powerful institutions. The negotiation is mainly within the move-
ment, of course in relation to experiences of challenging powerful groups. I am
adapting the term to express something closer to hegemony, but because it applies
only to a food regime, and not to the larger context, I prefer the more limited term
frame.
3. The implication of the word is still that shipments are charitable gifts, and the
word is powerful. In fact, even much emergency aid is tied, that is, it requires
recipients to use money donated to buy commodities from the donor. Critics such
as Oxfam International have argued against this practice for a long time but have not
succeeded in undermining the frame on this point.
4. Diaspora is a Greek word literally meaning the dispersal of seeds. It is used
metaphorically to refer to the spread of cultural colonies from a homeland, which
may still exist or existed only in the past. Jews have used this word for a long time.
Africans spread across the earth, originally through the slave trade, adopted it later.
Now it is widely used for any group. In application to Europeans opens more
nuanced ways of thinking about inter-cultural relations than the traditional (and
usually implicit) assumption that cultures correspond to state or have specific class
belongings (see Cohen, 1997). Similar recruitment of setters created what could be
called farming diasporas in Northwest British India (now Pakistan), Siberia, and the
Danube Basin. The rst was not European, and the diasporic farmers of the second
two are not usually treated that way, but perhaps should be. Thanks to Tony Weis
for suggesting the term diaspora to describe the founding process of the rst food
regime.
5. The phrase from Alfred Crosby (1986) refers to the transformation of land-
scapes and mix of species with the joint invasion of humans and their companion
species, wanted and unwanted, from Europe. I have tried to incorporate cultural
aspects inextricably linked with species, especially in agriculture and cuisines, with
the concept of biocultural diaspora (Friedmann, 2005).
6. Although sharecroppers of the South shared many characteristics of peasan-
tries and entered into populist politics of the late-19th century and the farm politics
of the New Deal coalition. Race politics complicated the story as much as relations
to landlords and markets.
7. The immense suffering from famines in certain peripheral regions of the co-
lonial-diasporic food regime resulted from colonial disorganization of old coping
systems and climatic cycles (Davis, 2001).
8. War often provides the occasion for massive institutional change (Arrighi,
1994; Ikenberry, 2001).
9. Inconsistency with domestic Agricultural Commodity Programs was a key
reason that the International Trade Organization agreement, signed in Havana in
1948, was not ratied by Congress. Instead, the General Agreement on Tariffs and
Trade, which was meant to be temporary until the ITO came into effect, became
permanent, and included a clause at the behest of the U.S. excluding agriculture
from trade negotiations. This lasted through several rounds of the GATT. In-
cluding agriculture was a goal of the last Uruguay Round and culminated in the
Agreement on Agriculture of the WTO.
10. These payments in national currencies, called counterpart funds, could only be
used in the country itself. Thus, the word aid is appropriate in the sense that the
U.S. accepted soft currencies in return for its goods, and in the case of Marshall
Aid particularly, used those currencies to assist in the rebuilding of national
industries, including export capacity. Thus about a decade and a half after World
War II, most countries of Europe were exporting enough to make their currencies
convertible into dollars.
11. The leading exception was Gandhi, who led the Indian independence move-
ment and believed in self-reliance in all sectors. However, the government was
formed by believers in industrial development, including Nehru, the rst prime
minister and leader of the emerging non-aligned movement (third world).
12. Earlier movements toward a world cuisine were industrial (Goody, 1982,
pp. 175190). The shift of basic staple is more clearly a feature of the intersection
between ideas of modernity and U.S. hegemony.
13. Nonetheless, the U.S. has consistently attacked the Canadian Wheat Board,
which holds a legal monopoly of wheat and some other grains destined for export, as
inconsistent with free markets.
14. The Group of Seven industrial nations attempted collectively to manage the
growing rivalry among international currencies that had supplanted dollar suprem-
acy in the 1970s; the footloose speculative capital released after the Thatcher and
Reagan governments removed capital controls in the 1980s; and the transfer in the
1980s and 1990s to the Third World and former Soviet bloc governments of full
responsibility for bad loans made to them by private banks to during the energy and
food crises of the 1970s the debt crisis.
15. The challenge originated in the late-1960s and culminated in the early-1970s as
The New International Economic Order. Its institutional expression was the
United Nations Conference on Trade and Development, formed in 1967, whose
passage through the neoliberal era may offer partial support to a voice for the South
in a new regime, along with other UN agencies, particularly the Convention on
Biodiversity (Bartlett & Friedmann, in press). In the North, it was the Brandt
Commission, which supported a sort of global Keynesian solution to the impasses of
the 1970s.
16. Sometimes also as food democracy.
17. http://www.viacampesina.org/. See McMichael (2005a).
18. A popular joke is to call it Whole Paycheck.
19. The Agreement on Agriculture relegated all quality issues to two categories,
called Sanitary and Phyto-Sanitary measures and Technical Barriers to Trade, which
would allow governments to make exceptions to the general principle of unrestricted
trade. The agreement specied Codex Alimentarius, an obscure agency of FAO and
the World Health Organization, as the arbiter of standards enforceable by the WTO
(see Bartlett & Friedmann, in press).
20. www.cargill.com, 2/7/04, and Cargill press release reported in Star-Tribune,
10/7/04, both cited in The Rams Horn, 222, July 2004, 23.
21. http://www.eurep.org/ Accessed September 4, 2004.
22. Most recently at the meeting of technical experts on traceability on the Con-
vention on Biodiversity in Montreal, March 2005.
23. As a personal complaint, Canadian cherry prices have skyrocketed, I am told
by local merchants, because of Japanese demand.
24. These examples come from Salete Cavalcanti, personal communication.
25. Victor Heurta of Equipo Puebla, personal communication, June 2004.
26. www.slowfoodfoundation.com
27. A promising vision comes out of part of the experience of European rene-
gotiation of sovereignty (e.g., Archibugi, Held, & Kohler, 1998).
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GLOBAL DEVELOPMENT AND THE
CORPORATE FOOD REGIME
Philip McMichael
ABSTRACT
The corporate food regime is presented here as a vector of the project of

global development. As such, it expresses not only the social and eco-
logical contradictions of capitalism, but also the world-historical con-
juncture in which the deployment of price and credit relations are key
mechanisms of accumulation through dispossession. The global dis-
placement of peasant cultures of provision by dumping, the supermarket
revolution, and conversion of land for agro-exports, incubate food sov-
ereignty movements expressing alternative relationships to the land,
farming and food.
INTRODUCTION
The concept of global development, informing the Doha Round, is prem-

ised on the political reconstruction of agriculture as a world economic sec-
tor. In 2001, the U.S. Secretary of Agriculture, Ann Veneman, envisioned a
global agriculture (where) future agriculture policies must be market-
orientedythey must integrate agriculture into the global economy, not
insulate us from it (quoted in IUF, 2002, p. 4). Such reference to a global

ISSN: 1057-1922/doi:10.1016/S1057-1922(05)11010-5
265
266 PHILIP McMICHAEL
agriculture is a discursive construct embedded in the political narrative of

globalization, as a progressive realization of economic liberalization. The
narrative is prescriptive, but not inevitable. And yet, while agricultural trade
remains the center of political controversy in the WTO, the seemingly ir-
resolvable nature of these trade rules will continue to realize this narrative.
Meanwhile, V a Campesina, the transnational peasant coalition, observes
that the massive movement of food around the world is forcing the increased
movement of people. Notwithstanding the profound impacts of human
displacement on such a growing scale, the juxtaposition of new circuits of
food and labor represents a historic moment in the reproduction of capitalism
through mechanisms of accumulation by dispossession. The latter is both
an originating and a self-propelling dynamic, where capital expands through
the release of assets, whether new or over-valued: [w]hat accumulation by
dispossession does is to release a set of assets (including labour power) at very
low (and in some instances zero) cost. Over-accumulated capital can seize
hold of such assets and immediately turn them to profitable use (Harvey,
2003, p. 149).
In the context of corporate globalization, accumulation by dispossession
operates through general mechanisms of structural adjustment, which de-
value and privatize assets across the global South, as well as through par-
ticular mechanisms of displacement of peasant agriculture, as a world
agriculture emerges. Here, local provisioning is subjected to the combined
pressures of dumping of Northern food surpluses, an agro-industrial su-
permarket revolution, and the appropriation of land for agro-exporting.
That is, through economic liberalization, new food circuits relentlessly dis-
place small farmers into an expanding circuit of casual labor, exibly
employed when employed at all. Thus, a global labor reserve, and (dis-
placed/released) cultures of provision, represent new opportunities for
accumulation in a global project of development.
This chapter proceeds by examining the institutional tensions in the Doha
Development Round associated with the pursuit of global development, via
the corporate food regime. While the rhetoric of development frames the
WTO Ministerial meetings since the Doha Ministerial in 2001, the practice
of global development is ltered through the competitive relations among
(unequal) states. And these competitive relations are increasingly governed
by the corporate pursuit of comparative advantage across the state system.
The latter is decisive in constructing a world agriculture, generating the new
circuits of labor fueling global development.
The corporate food regime is a key vector of the project of global
development. This project is characterized by the global de-regulation of
Global Development and the Corporate Food Regime 267
nancial relations, calibrating monetary value by credit (rather than labor)

relations as practiced through the privatizing disciplines internalized by
indebted states, the corporatization of agriculture and agro-exports, and
a world-scale casualization of labor (McMichael, 1999). The corporate
food regime exemplies, and underpins, these trends, through the determi-
nation of a world price for agricultural commodities strikingly divorced
from cost.
It is one thing to subject agriculture to the price form, but quite another,
through political means, to articially depress agricultural prices through
a food regime of overproduction and dumping. While the postwar U.S.-
centered food regime managed overproduction to serve targeted Third
World markets, the world price of the corporate food regime is universalized
through liberalization (currency devaluation, reduced farm supports, and
corporatization of markets), rendering farmers everywhere vulnerable to
dispossession as a precondition of the construction of a world agriculture.
THE DOHA MINISTERIAL AS A

DEVELOPMENT INITIATIVE
The designation of the WTO Ministerial in Doha (2001) as the development

round responded to concerns in the global South that globalization was
not meeting its promise. Accordingly, the Doha Development Agenda
Round aimed to strengthen globalization as an inclusive force. Naming it a
development round recalls the legitimizing function of development dis-
course in moments of intensied global inequality, like the era of decolo-
nization (Escobar, 1995). It also reminds us that calling the new round
development simultaneously promises and proscribes.
The Doha Round proposed to facilitate new trade-offs for the global
South, whereby further de-regulation of Southern economies would be
matched with possible Northern concessions. These concessions were:
1. Freer trade, e.g., improved access to Northern agricultural markets, and
reduction of Northern subsidies of farmer and agro-exports.
2. Qualication of WTO protocols, e.g., public health emergencies overrid-
ing specications of TRIPs for trade in pharmaceuticals.
3. Management of liberalization of services to enable participation by
Southern countries in service trade.
4. Reinforcement of Special and Differential Treatment provisions to ad-
dress food security and rural development needs of Southern countries.
5. Technical assistance and capacity building schemes for the global South,
especially for the least developed countries.
As it happened, the development round was stillborn, because of insti-

tutional inertia, concessions by Northern states to corporate lobbies (e.g.,
the pharmaceutical industry), and lack of capacity in Southern states to
address and/or implement reforms. In the run-up to the Cancun Ministerial
in September 2003, the Northern states adopted a more aggressive stance,
reformulating the Doha Round as an opportunity to impose a corporate
agenda of equal domestic treatment of foreign corporations, notably in
private investment in public services, in return for Northern action in ending
farm subsidies. However, where the latter decoupled subsidies from farm
prices, removing farm assistance to the WTOs non-trade-distorting Green
Box (as part of the Agreement on Agriculture), the Northern states, and
especially the EU, disingenuously retained the capacity to dump cheap farm
produce onto the world market.
The combination of the Europeans attempt to reintroduce the Singapore
agenda regarding a global investment treaty, and the Norths avoidance
of the dumping question, crystallized a counter-mobilization in Cancun
(September 2003) of the global South, represented by the so-called G-20 (the
Southern equivalent of the Cairns Group of agro-exporting states). Since
Cancun, while trade negotiations have slowed if not stalled, the parties have
regrouped the U.S. around bilateral negotiations, the G-20 around re-
gional agreements, and the Europeans around CAP reforms offset by
progress in trade in services, via the GATS. At the same time, the EU and
the U.S. have made attempts to co-opt the leaders of the G-20, Brazil and
India (Wiggerthale, 2004, p. 20).
Revival of the Doha Round pivots on agriculture, whose centrality to
Doha is reected in its contentiousness. New negotiations in 2004 involved a
revision of the pre-Cancun agreement struck between the EU and the U.S.,
including counter-proposals by the G20 (Oxford Analytica, 2004). The focus
of the new March text included the three key, original issues of market
access, export subsidies, and domestic support policies. The subsequent July
Package contained a commitment to end export subsidies, but over at least a
decade. Meanwhile, additional demands from the global South, led by the
newly empowered G-33 (exporters dedicated to protecting their domestic
markets), for a Development Box, to sanction subsidies supporting agri-
culture which is farmer-driven rather than trade-driven (surplus dumping)
gained little ground (Khor, 2004, p. 3). While agricultural reform is central,
it unfolds in piecemeal fashion, with the EU making what it considers
concessions in decoupling farm payments from commodity prices (though

without ending overproduction), and successful WTO litigation by Brazil on
U.S. cotton subsidies, which have wrought havoc on African producers.
In short, Doha concentrates international tensions and the contradictory
relations which constitute development. Currently, Doha claims further
global deregulation as the premise of development. Historically, Doha rep-
licates the GATT Uruguay Round of the 1980s, which aimed to liberalize
agriculture and services (then banking, insurance, and telecommunications)
in which the North held a competitive advantage. At the time the global
South was skeptical, as its cheaper exports of steel products, footwear,
electronic products, and agricultural products were limited by Northern
protections. India and Brazil led the resistance to broadening GATT, but
Northern pressure and the promise of open markets, including agricultural
markets, tipped the balance (Adams, 1993, pp. 196197). When GATT be-
came the WTO, the liberalizing Agreement on Agriculture was the quid pro
quo for the global Souths acceptance of TRIPs and TRIMs, which soon
proved to be a double threat to food security and sovereignty in the de-
veloping world (Wallach & Woodall, 2004, p. 193).
The Doha Round continues this dance, disingenuously representing
GATS 2000 as a trade agreement, which demands openness to cross-
border provision of services (by TNCs) as a condition for opening EU and
U.S. markets in garments, textiles, and agricultural products (Wallach,
2003). Oxfams Kevin Watkins (2002, p. 21) argues this replays the Uruguay
Round, when the global North offered market access in return for protec-
tion of TNC patents (costing the South $40 billion in technology rents). He
maintains that while the game has changed, the rules are the same: The
West buys your bananas and shirts if you give its banks and insurance
companies unrestricted access to your markets.
Offering perspective on the terms in, and means by, which Doha ad-
dresses agricultural reform, V a Campesina, noted: The negotiations on
agriculture still seem to be a ght between the corporate elephants of the
agro-industry represented by the European Union, the United States and
the Cairns group instead of negotiation on how to come to fair, equitable
trade relations that give protection to domestic food production and con-
sumption and the worlds environment (quoted in Wallach & Woodall,
2004, p. 215). Sophia Murphy (2004, p. 4) suggests the U.S. and the EU are
ghting what is likely to be a losing battle to maintain their export share in
world agricultural markets. Subsidizing their farmers is a short-term,
and increasingly untenable, tactic in the world market where countries
like Brazil, Argentina, Russia, China, and India can offer cheaper farm
commodities to transnational agribusinesses concerned with reducing costs

and accessing emerging markets of middle class consumers in these coun-
tries. She concludes: While the U.S., E.U. and Cairns Group/G20 ght
with each other over who will get (or keep) the investment of transnational
agribusiness, most developing countries [notably in sub-Saharan Africa] are
left on the sidelines (idem).
LINEAGES OF A CORPORATE FOOD REGIME
The losing battle within the global North nevertheless conditions the con-
struction of a world agriculture. The combined dumping of subsidized
food surpluses and growing agribusiness access to land, labor, and markets
in the global South clears the way for corporate-driven food supply chains
binding together a (selective) global consumer class. I examine this historic
process via the concept of the food regime.1
Food regime analysis has centered on distinguishing specific political
economic organization of food production and consumption relations dur-
ing the periods of British and U.S. hegemony (Friedmann, 1987; Friedmann
& McMichael, 1989). As Harriet Friedmann (2005, p. 129) puts it, Free
trade in agriculture, key to British hegemony, gave way under U.S. hegem-
ony to managed agriculture within the Free World. The point of such a
distinction is to account for the particular developments in agriculture as-
sociated with each regime. In the second half of the nineteenth century, the
British-centered world market encouraged the incubation of industrial ag-
riculture in settler states geared to supplying cheap foodstuffs for a pro-
letarianizing Europe. Through the devices of the U.S.-aid program of the
mid-twentieth century, surplus foods and green revolution technologies
from the First World entered the urban markets and the agrarian sectors of
the Third World, respectively.
The continuities across these two eras were the progressive industriali-
zation and specialization of agricultures (alongside tropical export agricul-
tures originating in colonialism), and a project of state-building, proceeding
from the settler colonies to the ex-colonies, as European empires collapsed
and the development era took shape. But there the similarities end. In fact,
these periods reveal quite distinct principles with respect to food and
capitalism.
The rst period was anchored in Britains model of free trade imperi-
alism, the deployment of a policy of economic liberalism to gain access to
the economies and colonial empires of its rival European states, and thereby
consolidate British commercial dominance in the world economy. The City

of London and the sterling/gold standard facilitated capitals rst world
market, especially in channeling investment to the peripheries of the world
economy given the protectionism of European rivals (McMichael, 2005a,
pp. 1127). Within these global circuits the rst price-governed market in
food emerged, anchored in the U.S. frontier of family farming, which pro-
duced low-cost wheat relative to that produced on capitalist farms in Europe
(Friedmann, 2005, p. 125, 1978). Cheap foodstuffs from the colonies (from
sugar to grains) sustained capitals primitive wage-relation in Europe, where
elites remained committed to restricted consumption for the proletariat
(Mintz, 1986; Halperin, 2004, p. 91).
The second period, characterized as embedded liberalism (Ruggie,
1982, but see Lacher, 1999), was governed by a series of social protections,
from policies of full employment, through xed monetary exchanges, to
managed farm sectors. Farshad Araghi (2003, p. 51) views this as an aid-
based food order of an exceptionally reformist period of world capitalism
rather than as a food regime of capital. The question here concerns both
history and intentionality. Historically, Britain formed its free trade empire
spatially through incorporation of new lands and resources, politically
through backstopping the gold standard (as an instrument of economic
liberalism), and temporally through manipulating countries sterling bal-
ances in London to deepen the circulation of capital. The U.S., by contrast,
was not concerned with outmanoeuvring economic rivals, so much as con-
taining the Soviet empire. Accordingly, it reconstructed the capitalist world
order not through formal empire, but rather through the reconstitution of
states as integral elements of an informal American empire (Panitch &
Gindin, 2004, p. 17). Central to this objective was political legitimation via
the development project: a state-building process in the Free World via
economic and military aid, with the U.S. model of consumption as the
ultimate, phenomenal, goal of development (McMichael, 2004a).
This model, represented as the endpoint of development (Rostow, 1960),
was historically particular to the U.S. as one of a set of (mainly settler) states
lacking a landed aristocracy, which might restrict domestic markets and
consumption levels for the working poor (Halperin, 2004, p. 280). In ad-
dition, the Fordist response to the Great Depression in the U.S. promoted
mass production via mass consumption (Halperin, 2004, p. 282). The inner-
directedness of this dynamic model, integrating agriculture and industry,
facilitated the incorporation of food consumption relations into an inten-
sied capital accumulation in the postwar period, and distinguished the U.S.
model of modernity (Friedmann & McMichael, 1989). Following the British
imperial legacy, beefing up (steak and fast-food hamburger) was the dietary
form in which modernity was represented (Rifkin, 1992). Historically, it was
a product of a managed agriculture, depending on commodity stabilization
programs and public support for capital-intensive agriculture, and expressed
in mounting food surpluses (a model also adopted in Europe, stimulated by
Marshall Plan aid).
The food aid regime was a solution to the overproduction of agricultural
commodities within a heavily protected U.S. farm sector, offering food at
concessional prices as aid to friendly Third World regimes on the Cold War
perimeter. Local, counterpart funds generated through this program pro-
moted agribusiness and adoption of western diets (Friedmann, 1982). Thus,
the Pax Americana centered on states as guarantors of markets. Agricultural
commodity prices remained relatively stable during this period of publicly
regulated trade in foodstuffs (Tubiana, 1989). Hegemony was achieved
through the development project, which was also a vehicle for the freedom
of enterprise associated with the reach of the U.S. multinational corpora-
tion (Arrighi, 1982).
The distinctiveness of these food regimes lay in the instrumental role of food
in securing global hegemony in the rst, Britains workshop of the world
project linked the fortunes of an emergent industrial capitalism to expanding
cheap food supply chains across the world; in the second, the United States
used food politically to create alliances and markets for its agribusiness. The
model of accumulation differed markedly across these two eras.
The point is not to hypostatize food regimes. They constitute a lens on
broader relations in the political history of capital. They express, simulta-
neously, forms of geo-political ordering and, related, forms of accumula-
tion, and they are vectors of power. In the rst, British hegemony, premised
on gunboat diplomacy and a sophisticated nancial architecture centered
on London, constructed a price-governed world market through which food
resources were developed in, and appropriated from, European peripheries
to cheapen labor costs (Friedmann, 1978; Luxemburg, 1963; Davis, 2001).
In the second, U.S. informal empire balanced the historic commitment to
the social contract with containment-driven state-building, legitimized
through the aid regime of the development project. Foods role was to
subsidize, simultaneously, the First World social contract and Third World
urban-industrial development.
The difference across the two food regimes was the realization of
First World citizenship and Third World independence. This emerged
through the crisis of the British model (Polanyi, 1957), social transformation
precipitated by ensuing warfare in Europe (Halperin, 2004), the collapse of
European empires, and the completion of the states system championed

by the rising power of the U.S. and its model of accumulation anchored in
national economic integration. Through these successive food regimes, the
relations of production and consumption of food expressed the distinct
moments in the political history of capital.
The corporate food regime is yet another moment. It carries legacies of
the previous food regimes, nevertheless expressing a new moment in the po-
litical history of capital. The political decomposition of citizenship and of
national sovereignty, via the neo-liberal globalization project, reverse the
political gains (welfare and development states) associated with the period
of U.S. hegemony, facilitating an unprecedented conversion of agriculture
across the world to supply a relatively afuent global consumer class. The
vehicle of this corporate-driven process is the WTOs Agreement on Agri-
culture, which, as above, institutionalizes a distinctive form of economic lib-
eralism geared to deepening market relations via the privatization of states.
The distinguishing mark of the corporate food regime as a new moment in
world capitalism lies in the politics of neo-liberalism. As argued elsewhere,
the globalization project emerged to resolve the crisis of the development
project, in which the nancial relations associated with the rise of trans-
national corporations and banks, and offshore money markets, were con-
strained by the social and spatial limits of the national state and its charge of
civic protection (McMichael, 2004a). The 1980s debt crisis of the Third
World revealed a world-economic crisis generated by over-reaching: of the
U.S. dollar, transnational bank lending, and borrowing by Third World
states. In this atmosphere of crisis, investors chose nancial instruments
over productive investments and rms relocated manufacturing to Third
World export processing zones.
This was enabled by the new conditions of structural adjustment, and
the dumping of cheap foodstuffs (lowering wage costs), stemming from the
breaching of the U.S.-centered food regime in the 1970s. Here, U.S. detente
with the Soviet Union was marked by massive U.S. grain shipments to the
Soviet Union, opening the door to an escalating trade war with Europe in
commercial food exporting (Friedmann, 2005, pp. 132133). Behind the
protections of the Common Agricultural Policy (CAP), Europe had
achieved self-sufciency by the 1970s, in the form of an imported (U.S.)
model of industrial agriculture producing surpluses of butter, milk, cereals,
and beef. With the French government proclaiming Produce to export:
agriculture is Frances green petrol (Bove & Dufour, 2001, p. 148), and
the U.S. committed to agro-exporting as a rear-guard green power
strategy expressing hegemonic decline (Revel & Riboud, 1986), intensied
competition for world market outlets via agro-export dumping shaped the
transition from developmentalism to globalism.
Agro-export dumping undermined the U.S.-centered food regimes system
of stable prices and managed disposal of food surpluses. World agricultural
prices fell from a mean of 100 in 1975 to 61 by 1989 a 39 percent decline.
Bearing less and less relation to the cost of production, which included
increasingly expensive farm subsidies, price volatility and decline brought the
agro-exporting states to the 1986 GATT Uruguay Round (1986), declaring
an urgent need to bring more discipline and predictability to world agri-
cultural trade (quoted in Watkins, 1991, p. 44). The outcome of this round
was the signing of the Agreement on Agriculture in the newly founded WTO,
1995, and the institutionalization of the corporate food regime.
ORIGINS OF FOOD SOVEREIGNTY
As a lens on the political history of capital, the food regime embodies the
tensions of periods of world ordering. In this sense, the food regime is not a
politicaleconomic order, as such, rather it is a vehicle of a contradictory
conjuncture, governed by the double movement of accumulation/legitima-
tion. The British-centered food regime embodied the tensions associated
with the demands for citizenship and decolonization, realized in the sub-
sequent U.S.-centered food regime, which modeled the possibilities of each
via economic nationalism. The U.S.-centered regime, in turn, embodied the
tensions associated with social protectionism, as the principle of freedom of
enterprise, central to the U.S. informal empire, undermined economic na-
tionalism (Arrighi, 1982; Lacher, 1999; Friedmann & McMichael, 1989).
Resolution via economic transnationalism has been institutionalized in the
governance mechanisms of the multilateral institutions, led by the WTO.
Here, the corporate food regime embodies the tensions between a trajectory
of world agriculture and cultural survival, expressed in the politics of food
sovereignty.
The current political conjuncture is the culmination of a long-term
imperial trajectory not simply the conversion of the non-European
world to export monocultures, but also the power relation consigning the
peoples of the colonized hinterlands to an unseen, racialized underconsump-
tion that has become the condition for metropolitan development and over-
consumption. In this trajectory, the appropriation of agricultural resources
for capitalist consumption relations (encompassing regions of capitalist mo-
dernity in much of the global North and parts of the global South) is realized
through an expanding foundation of human impoverishment and displace-

ment, and the marginalization of agrarian/food cultures. This much the ge-
neric capitalist dynamic of accumulation/dispossession would predict.
What is distinctive about this conjuncture is how dispossession is accom-
plished. Briefly, where the development project socialized security, the
globalization project privatizes security. These phases both represent po-
litical solutions to material needs. But Third World material needs under the
development project were already the result of colonial-induced social ca-
tastrophes. Mike Davis (2001) has documented, for example, how empire
dismantled village grain reserve systems in the non-European world, by
commodifying grain and transforming it into an export product.
The insecurities attending colonialism animated the twentieth-century
decolonization movement. However, despite Frantz Fanons (1967), warn-
ings in the execution of the development project across the postcolonial
world: Instead of the state being used as an instrument of development,
development became an instrument of the states legitimacy (Bose, 1997,
p. 34). In other words, while all states were ofcially charged, under the UN
system, with implementing the social contract, most ruling elites saw that as
an opportunity to centralize power and thereby progressively undermine the
viability of cultural forms of security in the name of development. To this
end, they prosecuted cash cropping with World Bank funding, prioritized
industrialization as the centerpiece of development, promoted mechanisms
of urban bias for political purposes, dam-building, and imported cheap
foodstuffs via the food aid regime. The managed construction of the Third
World (urban) consumer paralleled the decimation of peasant agriculture.
Each conrmed the central tenets of the development vision: that the west-
ern consumption pattern was a universal desire and peasants were historical
remnants destined to disappear.
The development project incorporated postcolonial states into a univer-
sal system of national accounting methods, standardizing the measurement
of material well-being (GNP), and the externalization of a variety of en-
vironmental degradations and social catastrophes. Only monetized trans-
actions were counted as productive, devaluing subsistence, cooperative
labor, indigenous culture, seed saving, and managing the commons as un-
productive, marginalized and undeveloped activity. As a consequence, the
worlds rural population decreased by some 25 percent in the second half of
the twentieth century with the steady displacement of peasant cultures
(Hobsbawm, 1992, p. 56; Araghi, 1995, 1999).
It is important to stress that this process is not simply the realization of
the development narrative a preordained movement of rural populations
into an increasingly urbanized wage-labor force but the displacement of

biodiversity, customary forms of knowledge and moral economy. This his-
toric rupture accounts for the emergence of food sovereignty as an alter-
native to the productivist paradigm, which measures food security in the
quantitative/monetized terms of market transactions. Food sovereignty is as
much a cultural, as a material, principle. How this rupture came to express
itself in the food sovereignty paradigm depended on the de-legitimization
of development.
The development honeymoon lasted at most for three decades (ca
19501980). The so-called lost decade of the 1980s was a key turning point,
as the management of the debt crisis heralded three profound changes in the
global political economy. First, the deployment by the debt managers (IMF,
World Bank, G-7) of structural adjustment conditions across much of the
Third World punctured the developmentalist illusion (Arrighi, 1990).
States, compelled to adopt neo-classical economic solutions, reversed course
on the social contract. Second, on a world scale, neo-liberalism reinforced a
nancialization of capital, away from productive investment toward sec-
uritization and business mergers and takeovers. Third, international power
relations were recast in terms of the North/South axis, rather than con-
tainment politics legitimized by developmentalism.
The debt regime began the institutionalization of the globalization
project, via the WTO, as the mother of all trade agreements (though not the
father, given the virulence of NAFTA, for example). During this transition
from a collapsing development, and emerging globalization, project, the
Agreement on Agriculture sprung from the Uruguay Rounds movement to
reform farm sectors and agricultural trade. Consistent with the neo-classical
agenda, food security came to be redened, and institutionalized, in the
WTO as an inter-national market relation. That is, in spite of the asymmetry
between the Northern and Southern agricultural labor force percentages 4
percent, versus 3070 percent, respectively (Kwa, 2002), a system of free
trade in agricultural products was installed to privatize food security as a
global, corporate relation.
PRIVATIZATION OF FOOD SECURITY VIA THE

CORPORATE FOOD REGIME
The shift in the site of food security from the nation-state to the world
market was engineered during the Uruguay Round (19861994), anticipating
the WTOs Agreement on Agriculture (1995). Under this agreement, states

no longer have the right to food self-sufciency as a national strategy. The
WTOs minimum import rule requires all member states to allow imports of
food up to at least 5 percent of the volume of domestic consumption
despite Article 25 (1) of the UNs Universal Declaration of Human Rights,
and Article 11 of the International Covenant on Economic, Social, and
Cultural Rights, which viewed the right of peoples to exercise sovereignty
over their natural wealth and resources as essential to the realization of
human rights (Desmarais, 2003, p. 148).
On the face of it, states appear to have been trumped by the WTO,
exposing their domestic food markets to the grain traders. French Farmers
Confederation leader, Jose Bove declares this is a totalitarian exercise that
allows the TNCs to force domestic producers to submit to their logic
(Bove & Dufour, 2001, p. 137). Nevertheless, the logic of subordinating
agriculture to the corporate model is not synonymous with a stateless world
food market.
In the rst place, the U.S. introduced a redefinition of food security as
best provided through a smooth-functioning world market (quoted in
Ritchie, 1993, fn 25) into the Uruguay Round in order to secure a com-
petitive advantage for U.S. agribusiness via the GATT, and subsequently
the WTOs Agreement on Agriculture. Second, and related, the WTO re-
tains this mercantilist imprint in managing asymmetrical agricultural rela-
tions, founded in an unequal state system. Third, corporate agricultures
trajectory is governed by historic divisions of labor and current nancial
mergers that centralize agribusiness capital. Unlike industry or services, the
capitalization of agriculture retains important spatial dimensions, expressed
politically in Northern agribusiness lobbies and farm sector policies geared
to producing (and dumping) food surpluses.
Thus, in Europe food self-sufciency was the initial postwar goal, shaping
Common Market policies in 1957, and into the 1960s. In return for the right
to protect large-scale staple food production (cereals, milk, beef, sugar), the
EEC agreed to import U.S. soya beans for European livestock in the
Kennedy Round of 19621967 (Herman & Kuper, 2003, p. 5). Bove notes:
The arrival of the rst soya beans in French ports, not subject to any
Customs duties, signaled the start of agricultural industrialization (Bove &
Dufour, 2001, p. 61). Cheap imported soya beans, complementing
local maize grains and silage, underwrote a global livestock complex
(cf. Friedmann, 1993). This in turn drove a CAP (1962) geared to guaranteed
high internal prices and the overproduction of cereals, generating food sur-
pluses and their untidy dumping on the world market. CAP management of
overproduction involved establishing production quotas, reducing the farm

population by 90 percent, and hastening corporate monocultures (Herman &
Kuper, 2003, pp. 1011). Moving to manage overproduction internationally,
the U.S. Agriculture Secretary, John Block, observed in 1986: the idea that
developing countries should feed themselves is an anachronism from a by-
gone era. They could better ensure their food security by relying on U.S.
agricultural products, which are available in most cases at lower cost
(quoted in Schaeffer, 1995, p. 268).
This form of global food security is accomplished through the political
construction of commodity prices. In 1986, U.S. corn dumping forced
Zimbabwes grain marketing board to cut domestic producers prices almost
in half and to reduce its purchase quota from these producers (Watkins,
1991, p. 43). A decade later, in 1996, politicization of price was key to
NAFTA in 8 months the domestic price of Mexican maize fell almost 50
percent, converging with the world price 12 years earlier than envisaged
(Herman & Kuper, 2003, p. 72). In 2002, the average price below the cost of
production of various U.S. agribusiness exports was 43 percent for wheat,
25 percent for soybeans, 13 percent for corn, and 35 percent for rice (IATP,
2004, p. 3).
The political determination of world agricultural commodity prices
emerged through the Uruguay Round negotiations, which sought to stem
the escalation of farm subsidies and manage the crisis of overproduction
arising from the U.S. and European Community agricultural policies
(Dawkins, 1999). Anticipating the outcome of the Round, in 1992 (by the
McSharry reform) the EU began switching from its original CAP farm
price support policies to U.S.-style government subsidies (Dawkins, 1999).
Replacing a guaranteed price with direct payments introduced the world
price to European producers, stimulating rather than eliminating surpluses
(Herman & Kuper, 2003, pp. 2728), and synchronizing EU policy with that
of the U.S. in favoring traders over producers.
The preference given to the price form disempowers farmers, and em-
powers agribusiness, across the world. In the North, traders and processors
purchase commodities through farm contracts at low prices unrelated to
production costs. For processors, articially cheapened corn subsidizes
supersizing in the fast food industry (Manning, 2004, p. 43). For traders,
low commodity prices enable commodity dumping in the world market
(assisted by export subsidies, especially European), forcing local prices down
at the expense of small farmers. The resulting, or potential for, low-cost
agricultural production in the global South in turn enables global sourcing
by agribusiness to exert further downward pressure on Northern farmers.
The result has been a mass exodus from farming in North, and South. It is
accomplished by depressed prices and the competitive advantage of inten-
sive agriculture integrated into agribusiness, and favored by a system of
asymmetrical farm supports. Privileging the price form facilitated the re-
structuring of Northern farm sectors, dominated by corporate agriculture.2
Synchronization of Northern farm policy anticipated the WTOs Agree-
ment on Agriculture. Despite the rhetoric of free trade, the Northern agenda
is realized through a corporate-mercantilist comparative advantage in a
highly unequal world market. The Agreement on Agriculture was designed
to open agricultural markets through minimum import requirements and
tariff and producer subsidy reductions. Southern states signed on in the
hopes of improving their foreign currency income from expanded agro-
exports (under the imperative of servicing foreign debt). But the effect was
to open markets for northern products, strengthening the position of the
global North in the international division of labor in agriculture (Pistorius &
van Wijk, 1999, pp. 110111). From 19702000, declines in the world per-
centage of agri-exports from Africa (10 to 3 percent), Latin America and the
Caribbean (14 to 12 percent), and the Least Developed Countries (5 to 1
percent), contrasted with a Northern increase from 64 to 71 percent
(FAOSTAT, 2004).
Within the rules set by the WTO, delinked from the UN Charters pro-
visions for economic and cultural (food) sovereignty, growing food de-
pendencies fullled the global vision of food security. National health,
social, and environmental regulations are assumed to restrict trade, and,
therefore, were required by the WTO to be translated into visible and
quantiable tariffs, then subject to reduction over time. In addition, a sub-
sidy hierarchy was constructed, where subsidies were consigned to boxes,
arranged according to degree of protectionist effect (Herman & Kuper,
2003, pp. 3536). The box system works to the advantage of the Northern
states, which routinely consign decoupled farm support payments to the
non-trade-distorting Green Box. The CAP, in particular, justies such an
arrangement through a rural development initiative prepared for the 1999
WTO Ministerial, whereby direct farm payments support the multifunc-
tionality of agriculture.
Besides allowing for a bait and switch operation to hide Northern sub-
sidies, the box system also disadvantages Southern states, which lack the
resources for (decoupled) farm support programs. The combination of re-
duction of customs duties via tarrication and protection of expanding
farm subsidies via boxes, has constructed a regulatory system that transfers
resources from public to private hands in the North, and exports food
dependency (and insecurity) to the South via dumping.3 Already in the mid-
1990s, half of the foreign exchange of the FAOs 88 low-income food deficit
countries went to food imports (LeQuesne, 1997). The destabilizing effects
of intensied export dumping, and Northern agricultural subsidies, frame
Doha and the geo-political tensions expressed at Cancun.
While the WTO is composed of member states, the very asymmetry of the
state system privileges corporate solutions in the implementation of rules.
For instance, the recent CAP reform, introducing multifunctionality as a
method of renaming the decoupling of farm subsidies to reward agricul-
tures non-remunerative services (environment, space, rural habitation, food
safety, and animal welfare) and making the CAP WTO-compliant, paves
the way for the end of any policy of market management and allows
beneciaries of decoupled subsidies to produce without restraints (other
than those of a phony ecology), to produce what they want and eventually
to change their production every year (Herman & Kuper, 2003, p. 84). The
logical extension of this reform is the de-localization of agricultural pro-
duction to preserve the European environment, while importing food from
offshore regions with low wages and weak environmental regulations as
the Doux group, the foremost French and European poultry producer, ac-
complished by purchasing Frangosul, the fourth largest poultry producer in
Brazil, where production costs undercut those in France by two-thirds (ibid.,
pp. 2122). De-localization is part of the global sourcing strategy of U.S.
corporations (Blank, 1998; Public Citizen, 2001), a movement conrmed by
the recent migration of failing U.S. soy farmers to Brazils expanding and
low-cost Matto Grosso region.
The WTO policy eliminating market management of agriculture shifts
priorities from public interest in producing use-values for domestic provi-
sioning, to private/public encouragement of producing exchange-values to
expand profits and export revenues. Liberalization is the means to this end
either through de-coupling, which supports Northern agribusiness with
public monies, or through reduction of Southern protections opening
economies to food importing and/or agribusiness offshore investment. Le-
gitimized by the discourse of food security, its privatization conditions an
emerging world agriculture subordinated to capital.4
WORLD AGRICULTURE AND EMPIRE
Historically, the movement of capital involves the progressive subordination

of agriculture, as an attempt to resolve agro-ecological crises stemming from
the metabolic rift, in a deepening of the rupture in nutrient cycling between

countryside and city (Moore, 2000, p. 123). Across the former food regimes,
subordination occurred within the framework of the nation-state, whether
via the national/colonial state nexus, or the national/neo-colonial state
nexus. The WTO, as the material expression of the state/capital nexus,
continues this process of subordination by capital on behalf of its member
states.
The WTO is not a state, rather a disembodied, and unrepresentative,
executive, but on a world scale. Comprised of member states, the WTO not
only instrumentalizes the competitive and hierarchical relations among those
states (cf. Buttel, 2003), but it also denies civil society full representation. In
these terms, the Cancun impasse expressed opposition to Northern hypocrisy
by Southern states, disenfranchised by WTO procedures and overwhelmed
by the material consequences in the erosion of their domestic farm sectors.
But, ironically, the G-20s call for greater market access expresses at one and
the same time a formal demand for equivalence in trade opportunities, and
yet a substantive complicity in the movement toward a world agriculture
based in agro-exporting (Peine & McMichael, 2005).
G-20 complicity expresses the logic of the Agreement on Agriculture,
namely to complete the liberalization of trade relations as the condition for
a world agriculture. But a world agriculture involves more than an inten-
sifying system of food swapping across national boundaries. It is premised
on the green revolution principle of appropriation, the progressive removal
of components of agricultural production from the control of the farmer via
intervention in natural processes (Goodman, Sorj, & Wilkinson, 1987),
starting with bio-engineered seeds, and complemented with a range of
chemical and mechanical inputs and specialized agricultural inputs (e.g.,
livestock feed).
Green, and subsequently, gene revolution technologies deepen the elim-
ination of biodiversity, seed saving, and local knowledge via agro-industrial
monocultures. Bio-engineering has transformed the crop development in-
dustry5 through the concentration and centralization of agri-chemical cor-
porations (Pistorius & van Wijk, 1999), and the corporate gene giants
already account for more than one-third of the global seed market and 100
percent of the transgenic seed market (Shiva, 2000, p. 9). Deploying the
discourse of intellectual property rights, the biotechnology industry seeks to
institutionalize gene patenting, through the WTOs TRIPs protocol,6 as a
key to elaborating a world agriculture, premised on the elimination of extant
agricultures and agro-ecologies through the privatization of knowledge a
principal feature of the corporate food regime.
The abstraction from ecology and local entitlements associated with a

world agriculture privileges the production of inputs for food processors,
agri-chemical companies or global retailers. Agro-industrialization, deliver-
ing agriculture to an array of input industries (from energy through fertilizer
to animal feed), consolidates a specialization process whereby [I]n intensive
farming the object is to adapt the soil to the crop, never the other way
round (Bove & Dufour, 2001, p. 67), also a movement of abstraction
anticipating a world agriculture. While this movement of abstraction is as-
sociated with the history of the agricultural frontiers of European capitalism
(Friedmann, 2000; Moore, 2000), its completion as a world agriculture is
pregured in the biological and socio-economic blueprints of the gene rev-
olution and the WTOs Agreement on Agriculture.
The concept of a world agriculture refers, not to the entirety of agri-
culture across the earth, but to a transnational space of corporate agricul-
tural and food relations integrated by commodity circuits. Justin Rosenberg
terms this space the empire of civil society: a politically managed material
integration of social reproduction across borders involving the extraction
and relaying of surpluses (Rosenberg, 2001, pp. 134135, 131). But the
material integration of social reproduction across borders is not simply a
space of globalized commodity ows creating new interdependencies an
immanent tendency in the history of capital. Rather, beyond Rosenbergs
formulation, a world agriculture resembles Hardt and Negris (2000, p. xv)
emergent concept of Empire, characterized by the removal of boundaries
either spatial or temporal (implicit in the process of abstraction), and, most
significantly, a paradigmatic form of biopower, where capital reconsti-
tutes humans through reconstituting the natural order, in the name of food
security and peace. This is particularly the case for agricultural workers,
more than half of whom are women, and who comprise a third of the 1.3
billion people actively engaged in agricultural production (half of the
worlds labor force), concentrated in the global South, and as high as 80
percent of the workforce in some countries (IUF, 2002, p. 3).
Deborah Barndts (1997) representation of one set of increasingly com-
mon conditions of social reproduction of the agricultural labor force in
corporate agriculture captures this process:
[T]he only Mexican inputs are the land, the sun, and the workersy. The South has been
the source of the seeds, while the North has the biotechnology to alter agro-export
production also denies them participation in subsistence agriculture, especially since the
peso crisis in 1995, which has forced migrant workers to move to even more scattered
work sites. They now travel most of the year with little time to grow food on their own
plots in their home communitiesy[W]ith this loss of control comes a spiritual loss, and a
loss of a knowledge of seeds, of organic fertilizers and pesticides, of sustainable practices

such as crop rotation or leaving the land fallow for a yearpractices that had main-
tained the land for millennia (1997, pp. 5962).
Such abstraction of agriculture through its incorporation and reproduction

within global capital circuits imparts a food from nowhere character to the
corporate food regime (Bove & Dufour, 2001, p. 55). At the core of this
process is the appropriation of farming, via the expulsion of rural popu-
lations through land dispossession and concentration, as farming is ren-
dered unviable by withdrawal of public supports and exposure to a world
price, or the conversion of farmers to contract farming or hired/plantation/
migrant labor, depending on context and crop. Mexico, the home of maize,
has been so transformed by liberalization and NAFTA into a food deficit
country, and forced to import yellow corn from the U.S. at the expense of
almost 2 million campesinos, unable to compete with corn price falls on the
order of 70 percent (Carlsen, 2003; Oxfam, 2003). In Brazil, price falls for
staple crops like rice and beans render small farming increasingly non-
viable, exacerbating a swelling rural exodus and rising urban unemployment
(Cassel & Patel, 2003); while in China recent liberalization associated with
WTO accession has accelerated a swelling rural migrant population that
overwhelms urban job markets, coinciding with the shrinking of state
enterprises (Eisenburger & Patel, 2003). In a 1997 FAO study of 16
Southern countries, reporting the dispossession of at least 2030 million
people, the overall impact of liberalization was identied with: ya general
trend towards the concentration of farms, in a wide crosssection of coun-
tries. While this led to increased productivity and competitiveness with
positive results, in the virtual absence of safety nets the process also
marginalized small producers and added to unemployment and poverty
(Madeley, 2000; p. 75).
Loss of land, livelihood, and knowledge constitute the core of cultural
displacement and dispossession. But empire, as the corporate food regime,
emerges through related forms of dispossession, notably of local food mar-
kets and cuisines such as displacement in Mexico of inexpensive white
maize tortillas by yellow corn tortillas manufactured at triple the price
(Bensinger, 2003; Oxfam, 2003, p. 19). Analytically, the construction of a
world agriculture involves accumulation by dispossession (Harvey, 2003).
While this process is both secular and cyclical, the neo-liberal project focuses
the expansion of profit on the release or privatization of (public) assets.
Here, the global integration of social reproduction is effected through the
appropriation of farming and informal provisioning (wet markets, street
vendors, and the commons). These processes eliminate extant systems of
provisioning, converting them to inputs for the corporate food regimes

proliferating supply chains.
Land expropriation may be the original form of accumulation by dis-
possession, but the realization of the corporate food regime involves a
deeper, and broader, reconstitution of material culture, centered on bio
political mechanisms. Thus, the global fast food industry, grossing $110
billion a year in the U.S., provides cheap and unhealthy convenience foods,
based on the appropriation of home-cooking activities and knowledges
(cf. Friedmann, 1999). The supermarket revolution in the global South
(Reardon, Timmer, Barrett, & Berdegue, 2003) intensies the combination
of food processing and retailing accumulation, incorporating small or in-
dependent producers and local markets and street vending into new cor-
porate circuits and biopolitical relations.
In the 1990s, supermarkets expanded their reach in Latin American
countries from 1530 percent to 5070 percent of national retail sales a
growth rate ve times that in the U.S., and accelerating now across Asia. In
Latin America, rms, including Ahold, Carrefour, and Wal-Mart, comprise
7080 percent of the top ve supermarket chains, centralizing procurement
from farmers across the region (and their own global processing plants), and
serving regional consumers (Regmi & Gehlhar, 2005). In a case study of
Guatemala, where supermarkets now control 35 percent of food retailing, it
was reported that their sudden appearance has brought unanticipated and
daunting challenges to millions of struggling, small farmers especially
tenuous relations in the absence of binding contractual agreements, re-
warded only if they consistently meet new quality standards, but subject to
declining prices as retailers have virtually unlimited suppliers (Dugger,
2004). Meanwhile, urban diets converge on a narrowing base of staple
grains, increasing consumption of animal protein, edible oils, salt and sugar,
and declining dietary ber, as consumption of brand name processed and
store-bought foods rises, contributing to an increasing prevalence of non-
communicable (dietary) diseases and obesity (Kennedy, Nantel, & Shetty,
2004, p. 14).
Corporate circuits frame the global transformation of social, biopolitical
and ecological relations. Thus, the director-general of the Centre for Inter-
national Forestry Research (Cifor) noted: In the 1970s and the 1980s most
of the meat from the Amazon was being produced by small ranchers selling
to local slaughterhouses. Very large commercial ranchers linked to super-
markets are now targeting the whole of Brazil and the global market
(quoted in Vidal, 2004, p. 3). Huge ranching operations organized by
European supermarkets now dominate the beef export market (75 percent of
Brazils beef exports ow to Europe and the Middle East). At the same time,
corporate-led factory farming is transforming the food sector currently
targeting Argentina, Brazil, China, India, Mexico, Pakistan, the Philippines,
South Africa, Taiwan, and Thailand. Asia, whose global consumer class
outstrips that of North America and Europe combined, leads the livestock
revolution (French, 2004, p. 148). Two thirds of the global expansion of
meat consumption is in the global South, sourced with Brazilian soybeans.
As a Chinese middle class emerges, China has shifted from a net exporter of
soybeans to the worlds largest importer of whole soybeans and oils even
Brazilian pastures are converted to soyelds, pushing cattle herds deeper
into the Amazon (Rohter, 2003, p. 3). In this way, biopolitical dynamics are
expressed in dietary and ecological transformations.
Neo-liberal discourse represents the material integration of social repro-
duction as an expansion of market efciencies through freedom of trade and
enterprise. However, it is premised on the deployment of the price weapon,
through dumping, to undermine local farming and incorporate local con-
sumption relations into global circuits, as well as on agro-exporting, via
structural adjustment measures, to displace publicly entitled foods. Given
the extent of displacement and dispossession, what is being socially repro-
duced? The contradictory relations of the corporate food regime. The par-
adox of this food regime is that at the same time as it represents global
integration as the condition for food security, it immiserates populations,
including its own labor force. The perverse consequence of global market
integration is the export of deprivation, as free markets exclude and/or
starve populations dispossessed through their implementation. In turn, dis-
possessed populations function as reserve labor, lowering wages and offer-
ing the possibility of labor casualization throughout the corporate empire.
More than simply a cumulative agro-ecological crisis (Moore, 2000), the
corporate food regime is also realized through social crisis. For example,
neo-liberal policies introduced in 1991 threaten Indias tens of millions of
small farmers, the livelihood source of 75 percent of the population. In 2000,
the Indian Ministry of Agriculture observed: The growth in agriculture has
slackened during the 1990s. Agriculture has become a relatively unreward-
ing profession due to an unfavourable price regime and low value addition,
causing abandoning of farming and migration from rural areas (quoted in
Paringaux, 2000, p. 4). Corporate seed prices have inated tenfold, cheap
imports (notably of rice and vegetable oils) have undercut local farmers and
processors, and policies promoting agro-exports of high-value commodities
like farmed shrimp, owers, and meat in the name of food security increase
human insecurities. Every dollar of foreign exchange earned on meat
exports destroys 15 dollars worth of ecological capital stemming from the

use of farm animals in sustainable agriculture, according to Vandana Shiva
(2000, p. 14). In other words, a condition for the social reproduction of
afuence is cultural displacement and unsustainable ecologies.
Is this an inevitable condition? Certainly not: the global integration of
social reproduction is an immanent, rather than an absolute, process, in
tendency and scope. The corporate food regime is a political construct, and
its beneciaries constitute only about a quarter of the worlds population,
despite the widening effects of social exclusion, through the appropriation of
resources (material, intellectual, and spiritual), and the privatization of
public goods. At the same time, these effects generate the conditions for
overcoming the social and ecological crisis of the corporate food regime, in
resistance movements dedicated to the social re-embedding of markets. Ul-
timately, the trajectory of the corporate food regime is constituted through
resistances: both protective (e.g., environmentalism) and proactive, where
food sovereignty posits an alternative global moral economy.
THE FOOD SOVEREIGNTY MOVEMENT
Food sovereignty represents an alternative principle to food security, as

currently dened by the corporate food regime. But it is not the antithesis of
food security, rather, food sovereignty is a premise for genuine food secu-
rity, since food is rst and foremost a source of nutrition and only sec-
ondarily an item of trade (V a Campesina, 2002, p. 8).
In the terms of the corporate food regime, food security is to be achieved
through trade, rather than through a strategy of self-sufciency. The chair-
man of Cargill put it recently like this: There is a mistaken belief that the
greatest agricultural need in the developing world is to develop the capacity
to grow food for local consumption. This is misguided. Countries should
produce what they produce best and trade (quoted in Lynas, 2001). This
definition frames the WTOs Agreement on Agriculture.
In this context, the concept of food sovereignty was developed by the
international farmers movement, V a Campesina, and introduced into
public debate during the 1996 World Food Summit. V a Campesina denes
food sovereignty in the following way:
In order to guarantee the independence and food sovereignty of all of the worlds
peoples, it is essential that food be produced through diversied, farmer-based produc-
tion systems. Food sovereignty is the right of peoples to dene their own agriculture and
food policies, to protect and regulate domestic agricultural production and trade in
order to achieve sustainable development objectives, to determine the extent to which

they want to be self reliant, and to restrict the dumping of products in their markets.
Food sovereignty does not negate trade, but rather, it promotes the formulation of trade
policies and practices that serve the rights of peoples to safe, healthy and ecologically
sustainable production (V a Campesina, 2001).
It is important to emphasize that trade is not ruled out, under the V a

Campesina vision, rather it is a question of the regime under which trade
occurs. The anti-capitalist resistance represented by the V a Campesina does
not reject the global for the local, rather it redenes the global in terms
appropriate to democratic conditions of food production and distribution.
As Judit Bodnar emphasizes in her interpretation of the conict between the
French Farmers Confederation and MacDonalds in 1999, Jose Bove and
his followers destroy transgenic corn produced by global rms not because
the seeds are produced by others but because of the way they are pro-
duced (Bodnar, 2003, p. 141). Under the slogan of the world is not for
sale, Bove and the V a Campesina emphasize two central premises: rst,
that the international tensions surrounding the politics of food ultimately
derive not from conict between governments, but that between models of
production and rural development a conict that exists in both the North
and the South (V a Campesina, 2003, p. 5); and second, that the struggle is
global but decentralized in content and leadership. Bove articulates the lat-
ter point as follows:
The strength of this global movement is precisely that it differs from place to placey. The
world is a complex place, and it would be a mistake to look for a single answer to complex
and different phenomena. We have to provide answers at different levels not just the
international level, but local and national levels too (Bove & Dufour, 2001, p. 168).
Embedded in this quote is the global vision represented by the V a

Campesina, namely that an alternative modernity depends on rejecting the
WTO/corporate move to privatize modernity and erase (shared) local
knowledges (cf. Desmarais, 2003), and on reinstating the right of peoples,
communities and countries to dene their own agricultural, labour, shing,
food and land policies which are ecologically, socially, economically and
culturally appropriate to their unique circumstances (quoted in Ainger,
2003, p. 11). Bodnars study emphasizes that, despite Boves relative priv-
ilege in producing the internationally traded Roquefort cheese, as an artisan
he represents a production model that appeals to farmers and consumers
worldwide, striving for transparent production and distribution in opposi-
tion to the mass production model of industrial agriculture. In addition, the
model elevates democratic economy and fair trade principles, as essential to
a global civil society, over the reactionary link between land and nation
(Bodnar, 2003, pp. 141143).
On the other side of the world, this sentiment echoes through another
constituent of the V a Campesina, the landless-workers movement in Brazil,
where exports of coffee, sugar, poultry, cacao, orange juice concentrate, and
soy and corn destined for livestock in the global North leave behind 44
million chronically hungry Brazilians as Candido Grzybowski (2004),
director of IBASE in Rio de Janeiro, observed:
Probably in Brazil there exists no greater taboo than that centuries-old question, the
agrarian question. But there is no question that is more current because it is not limited
to the countryside itself, to its populationy. The modernity of the MST consists in
questioning us about this, about the past of our agrarian origins and about the future in
the use of our natural resources, with the question of land at the centery. We are, of the
large countries of the world, the least demographically dense, the most privileged in
terms of natural resources land, water, biodiversity and at the same time, the most
unequal and tragically, the most predatory. For how long, in the name of an even more
narrow vision, will we be able to maintain the right to act on this part of Planet Earth in
a way that is so socially and ecologically irresponsible?
This appeal to a global movement against the uniformity of the corporate

trade regime, in the interests of the future sustainability of the social
and natural world, proceeds from an analysis of the power base of the
neo-liberal model. First, the V a Campesina argues that a world market of
agricultural products is non-existent, rather, the corporate food regime,
accounting for 10 percent of world agricultural production, is:
an international trade of surpluses of milk, cereals and meat dumped primarily by the
E.U., the U.S. and other members of the CAIRNS group. Behind the faces of national
trade negotiators are powerful TNCs such as Monsanto and Cargill who are the real
beneciaries of domestic subsidies and supports, international trade negotiations and the
global manipulations of trade regimes (2001, p. 6).
Second, agro-industrialization is being rapidly globalized through the mo-

bility of nancial capital, and its ability to rapidly concentrate, centralize,
and coordinate global agribusiness operations. According to Joao Stedile of
the MST, world agriculture is dominated by 10 TNCs, such as Monsanto,
Bayer, Cargill, Nestle, Syngenta, BASF, Novartis, and ADM, operating in
and across distinct sectors related to agricultural production, and control-
ling commercial agriculture, agrobusiness, the agro-toxins, and seeds: now
capital is not content to buy labor and hold land as private property, but it
also wants to turn knowledge, technology, farm technologies and seeds into
private property to increase productivity per acre, with the goal of devel-
oping a food model based in the unication of eating habits across the world
(V a Campesina, 2004c, p. 2). The power relation in the corporate food

regime is expressed in the V a Campesina (2004b, p. 3) claim that mul-
tinational corporations want to manipulate our crops to be able to control
all of the food chain around the world, requiring us to stop producing food
and start consuming their products.
The mechanism realizing this world agriculture is the neo-liberal model,
institutionalized in the WTO and structural adjustment policies. As the V a
Campesinas website observes:
The specialisation of production in regions that can export at lowest costs, importation
of agricultural products at prices below the cost of production in the importing country,
the agreement by the WTO of public support that allows the rich countries to export at
prices below their cost of production, is destroying food sovereignty in all regions. Prices
called global, are articial and result in dumping. They are disconnected from the reality
of production. Many countries are forced to export because of their debt and the struc-
tural adjustment programs imposed by the IMF and the World Bank (http://
ns.rds.org.hn/via/).
Within this context, the V a Campesina reformulates the crisis of the

corporate food regime, critiquing unequivocally the representation of the
Cancun standoff as a NorthSouth conict. Maintaining that the real con-
ict is between centralized, corporate-driven, export-oriented, industrial
agriculture versus decentralized, peasant- and family farm-based sustainable
production primarily oriented towards domestic markets, a conict in-
visibilized in global trade negotiations the V a Campesina (1999, p. 3)
argues the WTO is a totally inappropriate institution for democratic de-
cision-making regarding food sovereignty and social and ecological sus-
tainability, should get out of agriculture. Through this critique the V a
Campesina separates itself from the freer trade bid by the G-20, which it
views as promoting agro-export interests in the South at the expense of the
majority of domestic producers:
they too are demanding the abolition of trade distorting subsidies and more access to
markets, both in the North and in the South, without acknowledging that it is in fact the
unbalanced focus on exports and corporate interests which is the main problemy.
Increased liberalization and generalized market access will serve only to strengthen the
grip of multinational agribusiness cartels, deepening the problems of poverty and social
exclusion of millions of people in the world (2003, p. 5).
The V a Campesina opposes the WTOs neo-liberal project of constructing a

world agriculture based in comparative advantage, because it is not about
strategies of regional differentiation so much as about corporate global
sourcing strategies, premised on the existence of a reserve army of cheap
labor. Noting that the massive movement of food around the world is
forcing the increased movement of people, the V a Campesina offers a new

paradigm based in self-reliance at the national or community scale, as the
anchor of an alternative globalization. Here, food sovereignty depends on
access to credit, land and fair prices to be set via rules negotiated in a
reformed UN and alternative multilateral institutions such as a Convention
on Food Sovereignty and Trade in Food and Agriculture, an International
Court of Justice, a World Commission on Sustainable Agriculture and Food
Sovereignty, and so forth (2001, p. 8). As Bove asks, Why should the
global market escape the rule of international law or human rights conven-
tions passed by the United Nations? (Bove & Dufour, 2001, p. 165). The
premise, of course, is the active participation of farmers movements in
dening agricultural and food policies within a democratic framework. The
specicity of this politics is that, while the consumer movement has discov-
ered that eating has become a political act, articulating the health/trans-
parency relations of food, V a Campesina adds the social/ecological and
historical dimension: producing quality products for our own people has
also become a political actythis touches our very identities as citizens of
this world (www.ns.rds.org.hn/via/).
In sum, the coherence of the V a Campesina vision, uncompromising in
its relationship with the growth paradigm of neo-liberalism, and with NGOs
and multilateral institutions (Desmarais, 2003), constitutes a distinctive
politics of modernity rooted in a global moral economy. Echoing the early
twentieth-century argument by Peter Kropotkin that the preminent social
question is the question of bread, Amory Starr (2001) proposes that the
global anti-capitalist movement for diversity is best summarized as agri-
cultural:
encompassing rst world farmers seeking market protection, farmers resisting genetic
engineering, indigenous sovereignty movements seeking to control land and practices,
sustainable development, localist economic visions, and third world peasant movements
reacting to the failures of urbanization and neoliberalism by insisting on rights to land
and subsistence. These movements have a variety of relationships to political economy,
formal democracy and existing nations. But none imagines that growth, modernization
or technology provide answers to their problems; indeed they see corporate technology
as economically and ecologically dangerous (2001, p. 224).
And just as Starr characterizes the core of the anti-corporate globalization

movement as centered on agricultural issues, so the V a Campesina can be
viewed as the core of the resistance to the corporate food regime by artic-
ulating that which it seeks to eliminate. There are many strands of resistance
to the corporate food regime, from environmentalists through seed savers to
community supported agricultures, but the V a Campesinas unique method
of uniting the diversity of agrarian producers across the world unies a

heterogeneous resistance in which social, economic, cultural, and environ-
mental relations feature in different congurations across the world.
GLOBAL CAPITALISM AND THE CORPORATE

FOOD REGIME
The phenomenal dynamics of the corporate food regime, namely global

dispossession of farmers, reorganization of food supply chains, and cen-
tralization of agri-food relations, express the immanence of capital and its
drive to deepen commodity relations. The question is how these dynamics
also specify the world-historical conjuncture? The answer lies in the politics
of the corporate empire, that is, how a recongured state system accom-
modates the strategy of corporate globalization, centered on a U.S. imperial
strategy.
The origins of corporate globalization stem from the de-regulation of
nancial relations in the 1970s, as a U.S. strategy to unburden itself of rising
claims on the dollar, relocate debt to weaker states in the currency hier-
archy, and reassert U.S. power within an emergent neo-liberal framework
(Helleiner, 1996, pp. 111119). Decoupling the dollar from gold in the early
1970s allowed currencies to oat, and facilitated a rapid expansion of the
offshore dollar market and global banking institutions. The era of nan-
cialization expressed a hegemonic crisis (Arrighi, 1994; Panitch & Gindin,
2004) as the U.S. state moved to reconstitute its power through eliminating
capital controls, and laying the conditions for gaining access to global sav-
ings by liberalizing capital markets, with lowered trade and investment
barriers beneting U.S. transnational corporations. This strategy was the
condition of and for a counter-mobilization of capital to disorganize labor,
globally. It shaped a general reconstitution of states, via structural adjust-
ment and free trade agreements, to institutionalize nancialization in the
WTO and GATS protocols, and, more recently, has governed U.S. pre-
emptive neo-liberal development policies for failing states (Soederberg,
2004; Panitch & Gindin, 2004).
Financial liberalization encouraged securitization (tradable debt) and the
proliferation of a variety of nancial instruments, creating new money out
of expected future income. As argued elsewhere, under this regime the value
of money is determined increasingly by its ability to command credit, rather
than by creating value through the wage relation (McMichael, 2000).
This is consistent with Harveys concept of accumulation by dispossession,

where capital expands through releasing, and centralizing, assets. The
decomposition of the wage relation (casualization) is directly related to the
decomposition of the nation-state, as capital undermines its foundation in a
wagelabor order (embedded in the modern social-democratic state) by
seeking to evade or weaken organized labor through access to a world
market in labor. Since the wage form no longer governs valorization, various
forms of labor are valorized directly through political/non-market mecha-
nisms as corporate globalization reconstitutes its labor force on world scale,
through dispossession, casual contracts, and the recursive race to the bot-
tom dynamic. The reproduction of money, via global nancial relations,
supplants capitalisms earlier focus on the reproduction of wagelabor in the
consolidation of the nation-state.
An emergent world agriculture is premised on three key dynamics. First
is the reconstitution of capital through nancialization, such that corporate
strategies intensify vertical integration (from seed to supermarket) with
exible horizontal mergers and alliances, on a global scale. V a Campesina
has noted that agri-power no longer resides in control over land, rather it
resides in the relations that surround agricultural production those that
control loans, materials supply, the dissemination of new technologies,
such as transgenic products, on the one hand, and those that control na-
tional and international product warehousing systems, transportation, dis-
tribution and retail sales to the consumer, on the other hand, have real
power (V a Campesina, 2004a, p. 5). As Burch and Lawrence (2005) have
shown, one pertinent form of this reconstitution is the rise of highly inno-
vative and exible (generic) own brand agri-food manufacturers serving
supermarket chains (with specialty foods, including home meal replace-
ments, organic foods, functional foods and prepared dietary products) and
challenging the independence of brand-based manufacturing capital in the
supply chain stemming from the so-called Fordist era.
Second, the privatization of states via the relations of nancialization,
including WTO trade and investment rules, reconstitutes capital on a global
scale, and the transformation of food security into a private relation
(McMichael, 2004b). Under this dynamic, agricultural protections mutate
from a public food security/self-sufciency goal into a goal of subsidizing
corporate agriculture, agro-exporting, and global sourcing, facilitated by the
power relations within the WTO, as well as currency devaluations induced
by structural-adjustment policies in the global South.
Third, the priority given to the reproduction of money has specific po-
litical and social consequences. The preservation of money value increasingly
governs institutional politics in global and national arenas, generalizing a

cycle of liberalization and crisis management through structural adjustment,
at the expense of sustained social policies. Globally, the casualization of
labor through redundancy and exibility practices is linked to, and condi-
tioned by, peasant expropriation. This reserve army of labor, within a
transnational space governed by WTO principles of liberalization, is the
foundation for capitalist development on a global scale.
CONCLUSION
The argument of this chapter is that the food regime is a vector of social
reproduction of capital on a world scale. As such, it expresses the genetic
structure of capitalism in the accumulation/dispossession dynamic, and the
political structure insofar as states govern transnational circuits of food, and
their role in subsidizing the wage relation. Nonetheless geo-politics and the
accumulation/legitimation dialectic order the political history of capitalism
in distinct ways. The moment of world capitalism that denes the corporate
food regime is realized through the construction of a world agriculture. The
discursive element of this construction is akin to Cameron and Palans (2004,
p. 15) imagined economies of globalization, where authority and sover-
eignty no longer inhabit the same space. These imagined economies inhabit
different normative and cognitive spaces whereby the boundaries of the
state y are rendered multiple, complex and dynamic (ibid., pp. 1517), and
while they have an ontological force, their importance lies less in what they
describe than in what they narrate. In representing a dynamic respatializat-
ion of social and economic relations, the discourses of globalization and
exclusion posit the immanent development of new spatial forms to which
policy-makers, industrialists, jurists and ordinary people must adapt (ibid.,
p. 20). Such construction of a world agriculture serves to legitimize this
transnational circuit and its assault on peasant cultures, as a condition for
global food security.
The immanence of a world agriculture is ultimately shaped by the world-
historical conjuncture, which I specify via analytical comparison. Polanyi
viewed the institution of the self-regulating market as an attempt to com-
modify land, labor and money, and the protectionist movement as a
counter-movement of regulation of each of these social substances. The
counter-movement involved a cumulative politics of nation-state formation,
whereby labor legislation, agrarian protectionism, and central banking
attempted to re-embed the market in society. But this was a nineteenth and
early twentieth-century double movement that congured the modern wel-

fare/development state (McMichael, 2005b). In the twenty-rst century, this
trinity no longer operates through the same double movement. Rather, the
regulation of money is no longer vested in the state per se, but in instru-
mentalities such as the IMF, whose task has become a generalized imper-
ative to reproduce (corporate) money through expending labor and land
across the world with decreasing regard for their sustainability. The con-
struction of a world agriculture, deepening the instrumental use, misuse, and
abandonment of natural and social resources, unfolds within this general
imperative.
Arguably, the food sovereignty movement is the most direct symptom of
this socio-ecological crisis, especially insofar as it embodies a diversity of
responses corresponding to the re-spatialization of social and economic re-
lations in the corporate food regime. As an expression of the corporate food
regime, it reveals both the immanent, and the historical, conditions govern-
ing the politics of capitalist development in the twenty-rst century. That is,
in the crisis of the Doha Round, the discourse of development is most
clearly framed by the dialectic of food security versus food sovereignty.
NOTES
1. In relation to Harriet Friedmanns chapter in this volume, which reworks the
food regime concept in politico-normative terms, I offer a complementary use of the
food regime as a vector of the social reproduction of capital on a world scale, and as
a lens focusing on the social fact of dispossession. While a price-governed market is
the common feature of food regimes, the construction of this relationship is specific
to the historical conjuncture in which each operates.
2. By the mid-1990s, 80 percent of farm subsidies in the OECD countries con-
centrated on the largest 20 percent of (corporate) farms, rendering small farmers
increasingly vulnerable to the vicissitudes of a de-regulated (and increasingly pri-
vately managed) global market for agricultural products. U.S. farm income declined
by almost 50 percent between 1996 and 1999 (Gorelick, 2000, pp. 2830), and Europe
lost half of its full-time equivalent agricultural employment between 1980 and 2001,
with the equivalent of 1 million farm jobs disappearing in the latter half of the 1990s
(Herman & Kuper, 2003, pp. 2940).
3. Dumping was institutionalized within the WTO, via what is know as the Blair
House Agreement, concerning exports, negotiated between the U.S. and the E.U.
The agreement tied reductions in both domestic support and export subsidies to
baseline levels of 1986, when stocks and subsidies were at their peak, thus giving both
the E.U and the U.S. ample exibility in meeting their obligations, and established a
peace clause regarding action against farm support programs and export subsidies
(Dawkins, 1999). The legitimation of export subsidies (for 25 of 132 WTO members)
perversely allowed the U.S. and the E.U to intensify export dumping such that just
3 (members) are responsible for 93% of all subsidized wheat exports and just 2
of them are responsible for subsidizing 94% of butter and 80% of beef exports
(Dawkins, 1999).
4. Thus, in 2001, President Bush proclaimed, on the eve of the WTO Doha Min-
isterial, I want America to feed the worldy It starts with having an administration
committed to knocking down barriers to trade, and we are (quoted in IUF 2002,
p. 4). The associated U.S. vision of a global agriculture is premised on the supe-
riority of a corporate-dominated world market for foodstuffs over domestic food
systems (Peine & McMichael, 2005).
5. Typically, a crop development conglomerate is organized around one OECD-
based transnational enterprise (TNE), rooted in the chemical, pharmaceutical, or
food processing industry. This TNE maintains a network of linkages with one or
more plant breeding rms, new biology rms, genomics and software rms, and also
with public research institutes. The nature of the linkages is diverse and varies from
temporary research collaboration to complete take-overs (Pistorius & van Wijk,
1999, p. 118).
6. The TRIPs protocol requires states to regulate biological resources, whether
through patenting or an effective sui generis system, deriving from the 1992 Con-
vention on Biological Diversity. Although the protocol is yet to be universally im-
plemented, states choosing the latter path remain under pressure to market their
genetic resources for foreign exchange (McMichael, 2003, pp. 183184).
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SHIFTING STRATEGIES OF
SOVEREIGNTY: BRAZIL AND THE
POLITICS OF GLOBALIZATION
Sara Schoonmaker
ABSTRACT
This chapter explores Lulas internationalist strategy toward the politics
of globalization, which involves building alliances within the Common
Market of the South (Mercosur) and between Mercosur and the European
Union. It compares Lulas internationalism with the earlier nationalist
Brazilian informatics policy as shifting strategies of sovereignty, highlighting
their differences as interventions in the politics of globalization. In the
process, it explores the changing conditions of globalization and assesses
the potential of Lulas strategy as an alternative to the dominant neoliberal
globalization form.
Since his election as Brazilian president in December 2002, Luiz Inacio Lula
da Silva intervened in the politics of globalization in controversial and
complex ways, primarily in the context of participating in three sets of
negotiations over free-trade agreements. He co-chaired talks on the Free
Trade Area of the Americas (FTAA) with the U.S., sought to strengthen
and expand relationships among Latin American governments in the

ISSN: 1057-1922/doi:10.1016/S1057-1922(05)11011-7
301
302 SARA SCHOONMAKER
Common Market of the South (Mercosur), and was a key leader of the
Group of 22 alliance among delegates from the global South in the World
Trade Organization (WTO). In each of these venues, Lula challenged the
dominant form of neoliberal globalization, designed to open markets
around the world to global capital. He developed a strategy to transform
free-trade negotiations by forging an alternative culture of globalization, or
an emergent moral economy, centered on the issues of combating global
hunger and poverty. Lulas strategy reected key contours of contemporary
struggles over the politics of globalization, including struggles between
countries from the global North and South over the political, economic and
cultural conditions for development, as well as struggles between groups
united in their opposition to the dominant form of neoliberal globalization
but divided over the strategies to put their opposition into practice.
Lula thus developed a strategy to respond to changing dynamics in the
politics of globalization. That strategy was particularly relevant for the
Brazilian government, since it was rooted in a history of Brazilian govern-
ment intervention to promote national economic and political sovereignty.
One notable example of such intervention was the informatics policy begun
in 1976. This policy was designed to combat what Brazil and other gov-
ernments in the global South viewed as a new form of information depend-
ency, based on their lack of development of technological, industrial and
scientific capacities in computer manufacturing and software. The informa-
tics policy targeted the development of computer and software industries as
key sectors inuencing Brazils ability to compete in the global economy. It
sparked trade wars with the U.S. government in the mid-1980s, when Pres-
ident Reagan charged that its restrictions on foreign investment in Brazil
represented unfair trade practices against the U.S. rms. Indeed, the con-
troversies and struggles that arose over the Brazilian informatics policy were
grounded in the Brazilian governments strategy of opposing the U.S. gov-
ernment efforts to promote free trade and protecting its local industry from
competition from foreign capital.
Decades later, Lula used a markedly different strategy to continue this
struggle to promote Brazilian economic and political sovereignty. He raised
the stakes in the politics of globalization, pursuing an internationalist vision
of solidarity among Latin American governments and other nations in the
global South to advocate for human rights for the worlds poor. This chap-
ter will compare Lulas internationalism with the informatics policy as
shifting strategies of sovereignty, highlighting their differences as interven-
tions in the politics of globalization and assessing the potential of Lulas
strategy as an alternative to neoliberal globalization.
Shifting Strategies of Sovereignty 303
GLOBALIZATION, DISCOURSE AND

STRATEGIES OF SOVEREIGNTY
Under contemporary conditions of globalization, states interact with a
range of powerful transnational bodies, including international trade re-
gimes like the WTO and FTAA. As Held (2000, p. 398) argues, states
deploy their sovereignty and autonomy as bargaining chips in negotiations
involving coordination and collaboration across shifting transnational and
international networks. Indeed, the power of international networks
and regimes like the WTO and FTAA are part of an increase in regional and
global governance that states must address as they engage in trade and
development in the global economy. Since these non-state actors exercise
major inuence in the politics of globalization, states face pressures to de-
velop a strategy to engage with them. Globalization thus transforms the
conditions for states to exercise power, leading states to become central in
initiating new kinds of transnational collaboration, from the emergence of
different forms of military alliances to the advancement of human rights
regimes (Held, 2000, p. 397).
Lulas strategy of sovereignty exemplies such an approach, emphasizing
the centrality of the state as initiator of transnational alliances. Indeed, it
focused on strengthening collaboration between states in the global South to
negotiate not only with powerful states, but also with non-state actors like
the FTAA, the WTO and MERCOSUR. Lula shifted away from Brazils
historic emphasis on national government intervention to an internationalist
strategy rooted in alliance building, pursuing sovereignty beyond the
boundaries of national borders as a way to more effectively confront pow-
erful international interests in the politics of globalization. This strategy ts
with Helds (2000, p. 399) argument that under contemporary conditions of
globalization, the idea of a political community of fate of a self-
determining collectivity can no longer be meaningfully located within the
boundaries of a single nation-state alone.
Indeed, Lula pursued sovereignty through an internationalist vision rath-
er than a nationalist one. This approach was apt since he sought to advocate
broadly for human rights for the poor, not just within Brazil, but also within
the global South as a whole (and particularly in Latin America). He used
innovative discursive strategies as central elements in his struggle against the
dominant form of neoliberal globalization. He rearticulated the discourse of
free trade in a distinct way to ght for cultural values that have been his-
torically juxtaposed to free trade and the dominance of global capital, em-
phasizing the social implications of trade in terms of hunger and inequality
on an international scale. Through this politically astute approach grounded

in alternative cultural values, Lula joined the discourse of free trade with the
discourse about global hunger and the social exclusion of the worlds poor
from economic development.
In this process, Lula engaged in what Williams (1977, p. 126) called an
emergent alternative approach, involving new meanings and values, new
practices, new relationships and kinds of relationshipsywhich are substan-
tially alternative or oppositional to the dominant form. Indeed, Lula
framed his advocacy for free trade as a struggle for the rights of farmers and
the poor in the global South, to be waged by forming new relationships
among Latin American governments in the Common Market of the South
(Mercosur), the FTAA and among delegates from the global South in the
WTO. Drawing on Williams (1977), I conceptualize Lulas strategy for
sovereignty as emergent internationalism.
These new alliances are a vital part of Lulas shifting strategy of sover-
eignty, through which the Brazilian government rearticulates its opposition
to neoliberal globalization in a new and politically skillful way. This
approach is particularly tting in the context of the reconguration of
political power, where states face a proliferation of regional and interna-
tional forms of governance (Held, 2000, p. 394). In order to understand the
meaning and implications of this strategy compared to the informatics
strategy pursued in the 1970s and 1980s, I theorize globalization as a mul-
tifaceted process, where economic and political conditions and practices are
inextricably bound up with cultural and discursive ones. In the process,
I highlight the dynamic changeable and multidimensional nature of global-
ization and the political struggles to shape it.
Building on Schoonmaker (2002), I conceptualize globalization as a com-
plex, multidimensional process involving the simultaneous interaction of
economic, political, cultural and discursive practices. This post-structural
political economy perspective illuminates the importance of the cultural and
discursive dimensions of globalization through which key meanings of the
economic and political conditions of globalization are interpreted and
dened.
For example, Gibson-Graham (1996, p. 120) conceptualizes globalization
as a discourse, that is, as a language of domination, a tightly scripted
narrative of differential power. In discourse, actors exercise power through
the use of language as they struggle over how to dene the conditions for
economic and political practices. Theorizing globalization as a discourse
thus involves appreciating the ways that these political and economic prac-
tices are constituted and contested through struggles over language and
definitions of the terms and conditions for operating in the global political
economy. As Foucault argues, it is in discourse that power and knowledge
are joined together (1978, p. 100).
Analyzing the discursive dimension of globalization makes it possible to
identify how relations of power are constituted in language as well as in
action, and particularly in the complex interaction between the two. In the
rst volume of The History of Sexuality, Foucault emphasizes the impor-
tance of understanding that [d]iscourse transmits and produces power; it
reinforces it, but also undermines and exposes it, renders it fragile and
makes it possible to thwart it (1978, p. 101). Discourses are articulated
through a complex, unstable process where they have multiple meanings for
multiple interests. Discourse can thus be an instrument for exercising power,
a point at which we see the effects of power as well as a starting point for
strategies to oppose and resist power (Schoonmaker, 2002).
Foucault provides guidelines for how to conduct such a discursive anal-
ysis, which are useful in understanding the discourse of globalization. He
argues that the theorist must reconstruct the
multiplicity of discursive elementsywith the things said and those concealed, the enun-
ciations required and those forbiddeny; with the variants and different effects
according to who is speaking, his position of power, the institutional context in which he
happens to be situated that it implies; and with the shifts and reutilizations of identical
formulas for contrary objectives that it also includes (1978, p. 100).
Such a theoretical reconstruction sheds light on the power struggle involved

as Lula challenged the dominant neoliberal discourse of globalization with a
discourse of sovereignty and on the potential for using the sovereignty
discourse to create an alternative strategy.
DISCURSIVE STRUGGLES OVER FREE TRADE AND

NATIONAL SOVEREIGNTY
The discursive elements (Foucault, 1978, p. 100) of the neoliberal glo-

balization discourse involve four key assumptions. The rst is economic
determinism, where an objective economic logic determines market oper-
ations and leads markets to expand on a global scale. Second, free trade is
viewed as most conducive for operation in the global system, since erad-
icating the so-called barriers to trade, allows free access to trade and
markets for those parties most rationally equipped to participate. Third, the
state is viewed as an impediment to the rational operation of these objective
market forces. Finally, there is an ahistorical assumption that the expansion

of global trade and production is a novel, unprecedented development
(Schoonmaker, 2002).
Since the mid-1940s, the U.S. government championed various versions
of a free-trade discourse in its negotiations over international trade and
development, which coalesced into a fully articulated neoliberal globalizat-
ion discourse during struggles over the General Agreement on Tariffs and
Trade (GATT) during the 1980s. In trade debates during the 1970s and
1980s, Brazil led other countries in the global South to struggle against the
discourse of free trade with an oppositional discourse of national sover-
eignty. The sovereignty discourse was based on nationalist cultural values
that viewed national governments as the rightful arbiters of trade and de-
velopment policy, in a global context characterized by historical relations of
power between former colonies and colonial powers. This discourse recog-
nized the rights of governments in the global South to implement protec-
tions to promote the growth of local industry and technology.
Brazil and India led the opposition to the neoliberal globalization discourse
in debates over whether to expand the GATT into a regime governing trade in
services as well as goods, using these trade negotiations as a vehicle to resist the
domination of markets in the global South by global capital. They lost this
struggle with the inclusion of services trade within the GATT and the eventual
consolidation of the WTO as the global neoliberal trade regime replacing the
GATT, when the Uruguay Round of negotiations concluded in 1995 (Cowhey
& Aronson, 1989; Nicolaides, 1989; Marconini, 1990; Schoonmaker, 2002).
During the 1970s and 1980s, the Brazilian government fought a simul-
taneous, protracted struggle to implement its informatics strategy and pro-
mote national development of its information technology sector. This sector
was targeted for its potential to promote productivity in an array of indus-
tries, due to the integration of information technology into a diverse eld of
economic processes. Given the large size of the Brazilian market, as well as a
highly trained pool of scientists and engineers with expertise in information
technology, this sector held the promise of promoting national development
in a cutting edge eld. Informatics policy proponents also argued that the
policy could help decrease Brazilian dependency on computer imports,
which grew 600 percent between 1969 and 1974, comprising Brazils third
largest manufactured import and costing approximately $100 million in
foreign exchange (Evans, 1995, 1986).
Indeed, the Brazilian informatics policy was a cardinal example of a na-
tionalist development strategy and its conicts with the dominant neoliberal
globalization discourse. The cornerstone of this strategy, and its dening
feature as an economic nationalist approach, was the concept of the mar-

ket reserve, which was rooted in nationalist cultural values that dened the
market as part of Brazils national patrimony that should be protected by
the government to promote local economic development. The market re-
serve policy was established in 1976 and then extended for 8 more years in
1984 through the National Informatics Law. It prohibited multinational
corporations with home bases outside Brazil from investing in markets for
mini- and personal computers and restricting foreign imports and the ac-
quisition of foreign technologies (Adler, 1987; Schoonmaker, 2002).
The nationalist form of the informatics policy, rooted in its strategy of
pursuing national sovereignty by restricting the access of foreign capital to
Brazilian markets, threatened the U.S. government. In 1985, President
Reagan responded to this perceived threat by initiating an investigation of
Brazilian informatics for potentially violating the interests of the U.S. rms
under Section 301 of the 1974 Trade Act.
The reasons for this investigation were complex and largely symbolic,
rather than a response to short-term economic interests. Indeed, the U.S.
computer-related exports to Brazil rose by 146 percent between 1979 and
1985, compared with a 138 percent increase in such exports worldwide. The
U.S. government concerns with Brazilian informatics thus extended beyond
the traditional focus on exports that motivates trade disputes. As a State
Department ofcial testied before Congress, [i]t seems that Brazil, despite
its rapid growth, still sees itself as an underdeveloped country, a developing
country, which needs to utilize what we call infant industry policies in order
to nurture its growthy. We are concerned in fact that other developing
countries not emulate Brails approach to development (U.S. House Com-
mittee on Energy and Commerce, 1988, pp. 2223).
In the interviews I conducted with Brazilian business executives involved
with the informatics policys development and implementation, they under-
scored the symbolic nature of the policys perceived threat to the U.S.
government. They noted that the overtly nationalist character of the policy
made it a target for trade conicts, since the U.S. government disliked the
notion of Brazil being a nationalist model for other governments in the
global South (Ripper, 1990, interview; Fregni, 1990, interview). Indeed, U.S.
computer transnationals doing business in Brazil developed a working re-
lationship with the Brazilian government under the conditions of the policy,
and executives in these rms expressed concerns that U.S. trade pressures
might disturb this arrangement (Gomes, 1992, interview).
The Reagan administrations investigation of Brazilian informatics sparked
a trade war with the Brazilian government. It unleashed a complicated array
of national and international pressures that eventually led to the demise of the
informatics policy and the Brazilian governments support for nationalist ap-
proaches to economic development. From 1990 until 2001, the Collor and
Cardoso administrations dismantled the informatics policy as part of a broad-
er process of opening Brazilian markets in response to the constraints of
neoliberal globalization. During this period, the Brazilian government accom-
modated the neoliberal globalization model by advocating free trade and
opening Brazilian markets to foreign trade and investment. Its use of both the
free trade and neoliberal globalization discourses paralleled the use of those
discourses by the U.S. government and transnational corporations seeking
access to Brazilian and other markets in the global South. The advocacy
of free trade by this range of international actors was thus an integral part of
the broader advocacy of the neoliberal globalization model (Schoonmaker,
2002).
During his candidacy for and presidency of Brazil since 2002, Lula rup-
tured this fusion of the free trade and neoliberal globalization discourses. In
a bold and politically insightful move, Lula used the free-trade discourse to
rearticulate the Brazilian strategy to defend national sovereignty by oppos-
ing neoliberal globalization. He understood the free-trade discourse as a key
element of the neoliberal globalization discourse used by the U.S. govern-
ment since the post-war period. Drawing upon its symbolic power, he cre-
atively rearticulated the free-trade discourse, combining it with elements
from the sovereignty discourse to oppose the domination of markets in the
global South by the U.S. and European economic and political interests. In
the process, Lula developed an internationalist, yet regionally based, strat-
egy linking Brazils struggle for sovereignty with other Latin American
countries and with the poor people in all parts of the world. As an alter-
native to neoliberal globalization, this strategy was markedly different from
the informatics strategy. The key contrasts between these two alternatives
lay in their underlying values and their stance with respect to trade politics
and negotiations.
BROADENING THE SCOPE: INCORPORATING

ALTERNATIVE VALUES INTO TRADE AND
DEVELOPMENT POLICY
Lulas new strategy of sovereignty involved a shift from a nationalist to an

internationalist form of development and trade policy. As discussed above,
the informatics policy was oriented virtually exclusively toward the Brazilian
market, as a nationalist strategy to develop computer manufacturing and
software as key industrial sectors to compete in the global economy. By
contrast, Lula pursued an internationalist strategy designed to promote
Brazilian sovereignty by shifting its policy focus from the national to the
international arena in the struggles over trade and development politics.
Central to this internationalist shift was Lulas incorporation of alterna-
tive values into negotiations over trade and development. As mentioned
above, Lulas strategy is what Williams (1977, p. 124) called an emergent
alternative to the dominant, involving the development of new practices,
values, relationships and kinds of relationships that the dominant form
neglects, undervalues, opposes, represses, or even cannot recognize. In-
deed, Lulas emergent internationalism emphasized the eradication of hun-
ger on a global scale as a central theme in his discourse on development and
trade policy, a theme completely absent from, and thus truly unrecognized,
by the dominant neoliberal globalization discourse.
Indeed, this dominant discourse is based upon the assumption that mar-
kets operate efciently to allocate resources so that social welfare will be
maximized at the national as well as international levels. Markets are viewed
as neutral, objective forces that work to the benet of all, rather than fos-
tering the interests of one class or social group at the expense of others
(Epstein, Graham, & Nembhard, 1993). The global expansion of markets,
crafted through free-trade agreements such as the WTO and the FTAA, is
thus viewed as a way to foster conditions for prosperity on an international
scale.
Such expansion, however, has been shown to exacerbate problems of
global inequality with respect to the distribution of income, which has be-
come more unequal since the 1970s and had dire consequences for the
worlds poor (Hirst & Thompson, 1999). Free-trade regimes create condi-
tions, where transnational corporations exercise substantial power over
markets. In the agricultural sector, this has led to an international system of
trade and production geared toward the export-oriented crops produced by
corporate agriculture, rather than toward small producers catering to local
needs. Crops like strawberries and cut owers are grown on large industrial
farms and exported to afuent consumers, and livestock are fed large
quantities of grain that could otherwise be used to feed the poor (http://
www.globalpolicy.org/socecon/hunger/economy/).
According to a report by Action Aid International, the interests of small
farmers in the global South are damaged in three key ways by such trans-
national corporate control. First, market concentration drives down prices
for staples such as wheat, coffee and tea, which provides short-term benets
for consumers but hurts small producers, who grow these crops, and nd it
difcult to compete with large corporations that enjoy lower operating costs
due to economies of scale. For example, Monsanto controls 90 percent of
the world grain trade and manages 91 percent of the market for genetically
modied seeds. Second, small farmers are hurt, when agribusinesses raise
the prices of agricultural inputs or form price-xing cartels, again depressing
prices for the products of small farmers and making it difcult for them to
enter markets. Finally, agribusinesses set standards for participation in
supply chains for fruit, vegetables and other products that small, poor
farmers are unable to meet (http://www.globalpolicy.org/socecon/tncs/2005/
01powerhungry.pdf).
In addition to its damaging effects on the interests of small farmers, the
expansion of free trade is linked to environmental problems and the com-
plex economic, political and military conicts involved with what President
Bush calls the war on terror. The growth of world trade involves ex-
panding processes of both production and consumption, leading to increas-
ing trafc in workers, natural resources and other factors of production, as
well as the consumption of fossil fuels required to transport them. Such
growth is often accompanied by lax environmental regulations allowing
corporations to consume the raw materials available in one area of the
world and then freely move their operations to another (Brennan, 2003). As
Brennan (2003, p. 35) argues, [t]he impetus to expand (and nd the fuel to
maintain) transportation and telecommunications networks was a common
cause of twentieth-century warythatywill also feature in the twenty-rst
century. The U.S.-led war and occupation of Iraq supports Brennans
(2003) emphasis upon the connections between the neoliberal expansion of
trade and production and the drive to gain access to natural resources as
integrally linked causes of twenty-rst century war making.
Lula made a similar point when he raised the issue of world hunger in
international debates over trade and development, employing the discourse
of combating terrorism and weapons of mass destruction that emerged in
the years following the September 11 attacks. He argued that hunger in
itself is a weapon of mass destruction that kills 11 children every minute, a
fact virtually unrecognized in previous political speeches about the war on
terror (http://www.brazil.org.uk/page.php?cid=1812).
Despite the multiple links between the dominant model of neoliberal
globalization and global inequality, these connections were not effectively
articulated in the discourse over trade until Lula brought them to the fore-
front. In the 2 years following his election, Lula consistently raised the
problem of hunger in international fora such as the World Forum, the G-8
Summit, the United Nations General Assembly, and the Summit of the
Americas. In a speech entitled Making Globalisation Work for All, given
at an international conference on globalization held at the HM Treasury in
London in February 2004, Lula exhorted participants to muster the po-
litical will to fund programs in the global South that would contribute to
eradicating hunger, such as worker training, health care and education
(http://www.brazil.org.uk/page.php?cid=1812). He emphasized the ght
against hunger as a central pillar in the struggle against exclusion and in-
ternational inequality, as well as a crucial step on the road to greater social
justice, sustainable growth, human development and peacey (http://
www.brazil.org.uk/page.php?cid=1812). This integration of the struggle to
eradicate hunger as a centerpiece of international negotiations over trade
and development, rather than as a side issue to be dealt with separately from
the main agenda, was a crucial element of Lulas internationalist strategy for
sovereignty.
Indeed, the emergent alternative nature of this new internationalist strat-
egy was rooted in Lulas insistence upon viewing global trade and devel-
opment within the context of power relations between countries in the
global North and South and upon raising those inequalities in discussions at
a range of international fora. In a speech at the United Nations General
Assembly in September 2004, Lula emphasized these power relations by
discussing hunger and inequality as part of the legacy of colonialism. He
stated that 125 of todays 191 nations were
subjected to the oppression of a few powers, which originally occupied less than 2% of
the globe. The end of colonialism conrms, in the political arena, the right of peoples to
self-determinationy Political transformation, however, has not been transposed to the
economic and social elds. And history shows this will not happen spontaneously
(http://www.brazil.org.uk/page.php?cid=1887).
Lula noted that the current per capita income of the worlds wealthiest
country (U.S.) was 80 times greater than that of the poorest country, dra-
matically more unequal than in 1820, when it was ve times greater. Prob-
lems of global inequality increased even in the last 10 years, as per capita
income fell in 54 countries: the number of children starving to death grew in
14 countries, life expectancy decreased in 34 countries and lack of basic
sanitation killed more children than all the military conicts since the second
World War (http://www.brazil.org.uk/page.php?cid=1887).
In his speeches about trade and development, Lula thus emphasized the
ethical, as well as economic, problems involved with the effects of the
neoliberal globalization model on global inequality. He brought hunger

back in to the discourse on trade and development, integrating values of
social justice into these debates. These efforts t with political economists
Hirst and Thompsons (1999, p. 75) call to recognize the ethical dimension
of global inequalities in income and trade, stating that
[t]here are good ethical arguments against this situation. Its consequences for the living
conditions, life expectancy and security of the worlds poor are obvious. It should not be
allowed to go on and we should do something about it urgently as a matter of conscience.
Ethics, however, have rarely moved economists, Western policy-makers and company
executives: they need other rationales in terms of economic and business opportunities.
(Emphasis in original).
Hirst and Thompson (1999, p. 76) provide some of these rationales, such as
economic and security problems that may arise, when two-thirds of the
worlds population is excluded systematically from the prosperity enjoyed
by the already employed and successful in the wealthy 14 percent of the
world and a few client states. Indeed, what the Bush administration and its
allies perceive as threats to national security and the war on terror
arose in a global context fraught with inequalities and tensions between the
worlds rich and poor.
Lula provided further rationales for economists and policy-makers in the
global North to consider hunger and inequality in the context of negoti-
ations over global trade and development, arguing that such negotiations
will not be successful unless they are broadened to include these issues
crucial to the global South. Lula thus integrated alternative values of con-
sidering the effects of trade on hunger and inequality as a political tactic
both to pressure representatives from the global North and to mobilize
those from the global South.
Lulas strategy was rooted in an oppositional stance toward the dominant
neoliberal globalization model, particularly within the FTAA and the WTO,
and its links to inequality and hunger in the global South. Opposition to the
neoliberal globalization model appealed to a diverse range of constituencies
within Brazil, including the poor, landless movements, and large sectors of
Brazilian business and agriculture as well as with the international alter-
mondialiste movement.1 For example, the Central Unica de Trabalhadores
(CUT), Brazils major industrial union, actively mobilized against the
FTAA. Lula thus attempted to build alliances among local capital, labor
and the poor around their common interests in opposing neoliberal global-
ization, and particularly the interests of the U.S. and other representatives
from the global North within the FTAA and the WTO.
This strategy was complicated, however, since Lula did not reject free-
trade agreements outright as the more radical groups and movements ad-
vocated. By contrast, he expressed a commitment to participate in the
FTAA and the WTO, albeit through a process of struggle to transform
them. The contradictory nature of his strategy created tensions between
Lula and his allies to the left. These tensions coincided with other political
struggles in Brazil, where Lula failed to fulll his electoral promises to
address inequalities in income, education and health care as the top pri-
orities of his administration. Instead, Lula strove to balance competing
interests in Congress to build a coalition to pursue a much more limited
agenda, including social security reform designed to increase the contribu-
tions of government workers and limit retirement benets to future workers,
tax reform designed to increase efciency and reduce tax competition be-
tween Brazilian states and scal conservatism and efforts to retain foreign
investment within the country. During his rst 2 years in ofce, Lula thus
struggled to maintain his Workers Partys (PT) traditional support base
among workers, particularly unionists and the poor, and a range of social
movements. (Helfand, 2004; Chu, 2005). As Gleber Naime, PT organization
secretary, stated, These two years weve demonstrated our capacity to
governy. And the changes may not be as far-reaching as we want them to
be, but theyre whats been possible (Chu, 2005, p. A3).
Lulas struggle to balance the desire for far-reaching changes with what
appears politically possible extends from conicts within Brazil to the in-
ternational sphere. This struggle is particularly evident in Lulas participa-
tion in the World Social Forum (WSF), a gathering of diverse participants
in the broader altermondialiste movement held annually since 2001. In 2003,
a newly elected Lula was welcomed as a celebrity at the WSF, where the
participants largely embraced his opposition to neoliberal globalization and
advocacy for the poor in the global South. By 2005, however, leftist activists
and academics at the WSF critiqued Lula for attempting to build support
for his government by repackaging neo-liberalism as the way to help the
worlds poor. (http://www.zmag.org/content/showarticle.cfm?Section-
ID=1&ItemID=7197).
Lulas engagement with the neoliberal model in the WTO and the FTAA
is more complex, however, than such a repackaging process suggests. The
strategy of participating in free-trade negotiations with the intention to
transform them is fraught with contradictions that could undermine or de-
rail it and is certainly not guaranteed to promote alternative values of
combating global hunger and poverty. This strategy is an attempt, however
awed and problematic, to make choices, to navigate the conicting
interests involved with power relations between countries in the global

North and South, within an institutional context of free-trade regimes
freighted with the legacy of colonialism and the economic and political
power of the North.
In making this attempt, Lula at times sounds like a hypocrite, a political
pragmatist, who will say whatever it takes to score political points and win
short-term victories. For example, Lula sounded such a note, when he ad-
dressed the issue of world hunger in a speech to the Mercosur-EU Business
Forum in October of 2003. He stated that it would be ineffective to play
the poverty card in such negotiations, because in business, no one respects
someone who arrives hanging his head in a submissive way. Its necessary
to have pride because if you dont respect yourself, the other side in the
negotiations wont respect you either (http://www.brazil.org.uk/page.
php?cid=1766). This statement implies that confronting countries in the
global North with hard questions of global inequality, hunger and social
injustice is merely a card to be played at the most advantageous moment
and that such a gesture involves an act of submission rather than pride or
deance. This statement is loaded with possible meanings, given its dis-
juncture with Lulas other public appeals to honor alternative values in the
context of free-trade agreements. It signies the complex, fractured nature
of Lulas venture to integrate alternative values that, as Williams (1977)
argues is characteristic of the dominant form, are neglected, undervalued,
opposed, repressed and unrecognized by the neoliberal globalization dis-
course. It raises questions about how one can speak a repressed, unrecog-
nizable language while undertaking communication with the powerful.
Indeed, the contradictory nature of Lulas strategy is underscored by the
rest of his 2003 speech to the Mercosur-EU Business Forum. After noting
the ineffectuality of playing the poverty card, he described his approach
as developing partnerships with governments that were willing to strike
mutually acceptable terms, where each government gave up something that
made it worthwhile for the other to make a counteroffer. In the case of
Mercosurs negotiations with the European Union (EU), he urged his
European counterparts to add additional agricultural products to the ne-
gotiating process, since those were of most interest to Brazil. He noted the
importance of understanding that international trade is still a long way
from being a relationship between equal partners. It needs to be liberalized
in such a way as not to extend or reinforce the inequality existing between
countries (http://www.brazil.org.uk/page.php?cid=1766).
In the end, Lula thus called on his trading partners in the global North to
recognize the inequalities of power involved with their relationship and to
move toward trade agreements that would counteract them. In order to

address the problem of global hunger in the context of international trade
and development negotiations, Lulas emergent internationalism thus in-
volved both attempting, in awed and contradictory ways, to articulate
alternative values in the discourse on trade and development, and building
new kinds of relationships between Brazil and its trading partners.
FROM NATIONAL TO INTERNATIONAL POLICY:

DEVELOPING INTERNATIONAL ALLIANCES
The importance of these new relationships attests to the changing conditions
of globalization that have transformed the prospects for sovereignty and
undermined the viability of the traditional form of economic nationalism
based on states acting alone to promote their countrys economic develop-
ment (Held, 2000). Lula responded to these changed conditions by pursuing
an internationalist strategy to strengthen and extend the Common Mar-
ket of the South (Mercosur) beyond its current membership of Brazil,
Argentina, Paraguay and Uruguay. He advocated strengthening Mercosurs
regional presence as a trading bloc by expanding it to include Chile and
Bolivia as full members, and eventually the rest of the Andean Community
(Downie, 2003). During his rst year in ofce, Lula engaged in extensive
outreach to South American governments in an effort to foster these new
regional alliances. On trips to Peru and Colombia, he encouraged greater
cooperation between these Andean Pact countries and their historic rivals in
Mercosur (Greider & Rapoza, 2003). Such efforts were not new in and of
themselves, since they resonated with earlier efforts by the Brazilian gov-
ernment to bolster South American trade alliances. The alternative nature of
Lulas strategy, however, was shaped by the historical context of the rise of
the EU, which Lula viewed as an example of the economic and political
benets to be gained by building these new forms of alliances extending
beyond the nation state.
Lula pursued the development of such alliances at Mercosurs meeting in
Paraguay in June 2003. The Brazilian contingent presented a program to
promote Latin American unity and bargaining power in relationship to the
U.S. and other governments in the global North by developing Mercosur
based on the model of the EU (Downie, 2003). They emphasized the con-
nections between trade relationships and the complex social and political
conditions involved with the broader process of development, advocating
the growth of Mercosurs political, social and cultural programs. Such

changes would involve expanding Mercosurs purview beyond its traditional
focus on trade relationships. They are still in the negotiating stage, however,
these changes suggest the potential to institutionalize new forms of co-
operation to address common concerns in the Latin American region from
improving the quality of life for the poor to providing a stronger alliance to
work through the United Nations and the Security Council to address in-
ternational conicts and threats to human rights. Such new forms of co-
operation are examples of the transnational collaboration that Held
(2000, p. 397) views as key to navigating the current conditions of global-
ization. Indeed, these alliances could provide a stronger institutional base
for Latin American governments to challenge the dominant neoliberal glo-
balization form.
The centerpiece of Lulas strategy to develop this institutional base was to
strengthen and expand Mercosur as a Latin American trading bloc. To
further international economic and political cooperation among Mercosur
trading partners, the Brazilian contingent advocated the development of
Customs Union and Common Market programs at the June 2003 meeting.
It proposed that the members should consider following the example of the
EU to create a Mercosur parliament as well as establishing a Monetary
Institute to develop a single regional currency. These programs might in-
volve developing new trade partnerships and negotiating new trade agree-
ments with the EU, India, South Africa and South Korea (Angrisani, 2003).
Lulas strategy for sovereignty thus involved an emergent internationalism,
emphasizing the development of new alliances and relationships among Latin
American nations extending from trade and development policy to social,
political and cultural programs. This internationalist vision was grounded
primarily in the effort to strengthen and expand Mercosur using the model of
the EU, which Lula described as a paradigm for integration (http://
www.brazil.org.uk/page.php?cid=1766). It responded to the changed condi-
tions of globalization theorized by Held (2000), where sovereignty involved
building new forms of cooperation beyond the bounds of the nation state.
The move to expand Mercosur, however, also occurred within a context
of Brazilian and Argentine dominance within that bloc, where those coun-
tries pursued individual interests through domestic decrees if they were un-
able to forge a regional consensus. Similar to the above discussion, Lulas
strategy for sovereignty was complicated. Relationships in Mercosur were
fraught with tensions arising from the history of difculties in implementing
regional accords, which would need to be addressed in the process of build-
ing increased cooperation (Angrisani, 2003).
Lulas emergent internationalist strategy for sovereignty thus viewed the

EU as a potential model for building transnational alliances to pursue Latin
American sovereignty under contemporary conditions of globalization. He
engaged in the politics of globalization by intensive alliance building, both
within Mercosur and by strengthening political and economic ties between
Mercosur and the EU, which was Brazils principal trading partner and
source of foreign investment. Lula articulated the importance of these mul-
tidimensional relationships in a speech at the Mercosur-EU Business Forum
in October 2003, stating, [o]ur afnity with Europe is also historical, cul-
tural and political. We see the world in a similar way. All of this forms a
solid base that we must value, and on which we must build a closer rela-
tionship that is more profitable for both blocs. (http://www.brazil.org.uk/
page.php?cid=1766).
In the geopolitical context of the Bush administrations policy of pre-
emptive war and continuing occupation of Iraq, and of widespread in-
ternational opposition to those policies, Lulas remarks underscored the
political significance of his emergent internationalist strategy to strengthen
alliances between Mercosur and the EU. Such alliances provided a potential
counterweight to the power of the U.S. in trade negotiations in the WTO
and the FTAA, which could bolster Brazils position in the politics of
globalization. These alliances were also freighted with tensions, however,
since Lula engaged in struggles with the EU as well.
SHIFTING NEGOTIATING STRATEGIES:

FREE-TRADE DISCOURSE AND
EMERGENT INTERNATIONALISM
In addition to formulating trade and development policy by strengthening
international alliances, Lula crafted a new negotiating strategy to engage in
trade politics, breaking from the earlier informatics strategy closing the
market to foreign capital to promote economic development and national
sovereignty. In the new era, the Lula administration demanded that the U.S.
and EU open markets in the global North to exports from the global South.
Instead of using the sovereignty discourse to defend the rights of govern-
ments in the global South to close their markets, Lula thus employed the
free-trade discourse to push for open markets in the global North.
This skillful discursive strategy sharpened the NorthSouth conict in
the politics of globalization by highlighting ways that governments and
corporations based in the global North failed to comply with their own calls
for free trade, and in the process, hurt the economic interests of farmers and
industrialists in the global South. The goal of this emergent struggle over
trade politics was to promote sovereignty and development in the South.
Lula articulated alternative values, however, to frame this development as a
human rights issue to advocate for the worlds poor.
Lula thus used the free-trade discourse in an innovative way: to call for
a new moral economy that infused questions of social justice with those
of economic development and trade. As discussed above, this strategy
did not involve merely repackaging neo-liberalism as the way to help
the worlds poor (http://www.zmag.org/content/showarticle.cfm?Section-
ID=1&ItemID=7197). By contrast, Lula pinpointed the inequalities be-
tween countries in the global North and South within the existing neoliberal
trade regime of the WTO, as well as ongoing discussions over the FTAA. He
emphasized the inconsistent application of free-trade principles to favor the
U.S. and EU, particularly in the area of agricultural subsidies. For example,
at the Mercosur-EU Business Forum he stated, What we want is equality
of opportunity, which is to say unimpeded access to markets and an end to
abusive restrictions that distort international trade to the detriment, most
of all, of developing countries. The billion-dollar agricultural subsidies
have created veritable trade apartheid (http://www.brazil.org.uk/page.
php?cid=1766).
Lulas powerful metaphor of trade apartheid further signies the sharp-
ening of the NorthSouth conicts over the politics of globalization, even in
the context of his strategy to strengthen transnational alliances between
Brazil, Mercosur and the EU. Through this language, Lula highlights the
inextricable connections between what the dominant neoliberal discourse
views as objective processes of economic development and the structural
conditions of race and class inequality that make such development possible.
Struggles over trade apartheid were particularly acute in the area of
agriculture, where the U.S. and EU governments maintained subsidies that
hurt agricultural interests in the South. The Lula administration used the
WTO as an institutional framework to attack these trade policies, using the
discourse of free trade, speaking the language of the dominant neoliberal
discourse in an effort to undermine it.
It led a complaint with the WTO, noting that the U.S. governments
cotton subsidies were particularly important to Brazil as the worlds fth
largest cotton producer. In this complaint, the Brazilian government charged
that between 1999 and 2003, the U.S. used $12.47 billion of subsidies to
American farmers to retain its position as the worlds second-largest cotton
grower and largest cotton exporter. In April 2004, a WTO panel decided in
favor of Brazil, nding that these subsidies articially lowered international
cotton prices and damaged the interests of farmers from the global South. In
March 2005, the WTO appellate body upheld that ruling, paving the way for
further challenges to subsidies in the global North that undermine the in-
terests of farmers in the global South (Becker, 2005; Sequera, 2004).2
These events highlight the importance of trade negotiations as a terrain for
the struggle over the politics of globalization. The Brazilian government ef-
fectively employed the free-trade discourse as a tactic to wage these struggles.
These successes do not, however, reveal that single states pursue strategies for
sovereignty primarily by acting alone. Indeed, the above WTO complaint was
further evidence of the Brazilian governments effective emphasis on alliance
building, since it was joined by Argentina, Australia, Benin, Canada, Chad,
China, the European Community, India, New Zealand, Pakistan, Paraguay,
Taiwan and Venezuela (Becker, 2005).
In a similar vein, the Brazilian government engaged in extensive, and
sometimes tense, negotiations with other governments to dene the issues to
be covered within the FTAA and the WTO. Lula fought for a particular
position with respect to those definitions, however, the multilateral nature
of these institutional contexts required him to negotiate the content of those
positions and build alliances in order to put them into practice. Due to the
contrasting politics of globalization in each venue, the FTAA involved a
greater emphasis on negotiation and the WTO on alliance building.
With respect to the FTAA, Lula sought to limit the scope of the issues
discussed, and thus marginalize it as a venue for trade negotiations, due to
the dominance of the U.S. government in that context (Brazil News, 2003).
Toward that end, Lula advocated a weaker FTAA that would cover what-
ever issues were not addressed within the WTO or bilateral negotiations;
such as standards, technical issues like rules of origin, competition policy
and harmonization. By contrast, the U.S. government favored a broader
scope of negotiations for the FTAA, which would expand its purview to
include the questions of opening markets in services and government pro-
curement, as well as strengthening roles on investment and intellectual
property. It pressured Latin American governments to support its position
by threatening to forego the FTAA in place of bilateral arrangements with
individual governments, or smaller groups of governments, willing to co-
operate with its free-trade agenda.
In this context, a range of Latin American governments supported the
U.S. call to widen the FTAAs purview to include questions of opening
markets in services, government procurement, investment and intellectual
property. Smaller Caribbean economies were relatively unconcerned about

the Brazilian governments charge that a strong FTAA would increase
competition from U.S. industry. Indeed, they were primarily interested in
negotiating access to U.S. markets. Colombia, Peru and 10 other Latin
American governments supported the U.S. position as a way to solidify their
existing trade preferences with the U.S. government and avoid the prospect
of being excluded from the FTAA, as the U.S. government had threatened
(Brazil news, 2003, The Economist, 2003).
In the wake of U.S. government pressures and the compliance by other
Latin American governments to the U.S. position, Lula continued to oppose
the broader version of the FTAA. On the basis of the free-trade discourse,
such an agreement would prohibit domestic-content policies, which have
been used historically by governments in the global South to promote eco-
nomic development. The Brazilian government has used such policies since
the 1950s to promote the transfer of technology and the development of
local industries, including informatics. Under such an application of the
free-trade discourse within the FTAA, the Brazilian government would not
be allowed to require transnational corporations selling their products
within Brazil to include a percentage of domestically manufactured parts.
By outlawing such policies as impediments to free trade, the FTAA would
deny the Brazilian government one of its key tools for encouraging indus-
trial growth, potentially fostering greater dependence on the U.S. capital in
the process. Such a version of the FTAA would strengthen the process of
neoliberal globalization by supporting the interests of transnational corpo-
rations in challenging national regulations that impede their access to global
markets.
In a similar vein, the current version of the FTAA gives corporations the
power to sue national and local governments over health and safety reg-
ulations as restraints of free trade. And the Bush administration is pushing
Latin American governments to accept a degree of patent protection for
transnational corporations that even the WTO has refused. According to a
study by the Center for Economic and Policy Research, Brazils net losses
from increased royalties and licensing fees would outweigh the benets from
increased trade (Gourevitch, 2002).
These impacts on Brazilian development help explain why the Lula ad-
ministration continues to struggle to limit the purview of the FTAA, and
highlights the stakes involved with the FTAA negotiations for the broader
neoliberal globalization agenda. Indeed, supporting the free-trade discourse
within the institutional context of the FTAA involves supporting the dom-
inant neoliberal globalization model of opening markets around the world
to global capital and creating obstacles for states in the global South to
enact policies to shape conditions of economic development. These impli-
cations contrast markedly with Lulas use of the free-trade discourse dis-
cussed above, to pressure governments in the global North to open markets
to those in the global South.
Lulas broader strategy of emergent internationalism involves a series of
interrelated elements in the sphere of trade politics. His negotiating strategy
on the FTAA is linked to his efforts to nalize a free-trade agreement
between Mercosur and the EU by the end of 2004. Lula highlighted these
connections in a speech to farmers at an agricultural conference, noting
that reducing tariffs and quotas between these two trading blocs would
improve Brazils position for the FTAA, so were not exclusively subject-
ed to U.S. economic pressure (www.latimes.com/business/investing/wire/
sns-ap-brazil-europe,0,193650.story?coll=sns-ap-investing-headlines).
Such an EU-Mercosur deal could increase Lulas willingness to include
agricultural issues in the FTAA negotiations, rather than relegating disputes
over agricultural subsidies and tariffs to the WTO. It would strengthen the
Brazilian governments prospects for pursuing its emergent internationalist
strategy within the institutional context of both of these trade accords.
As Lula stated in a speech to the Mercosur-E.U. Business Forum, Brazil
wants to negotiate [the FTAA]yWhat we dont want is to be defeated
in the FTAAybecause we want to defend our economy, our industry,
our agriculture, our trade, our jobs and our sovereignty. (http://www.
brazil.org.uk/page.php?cid=1766).
Lula thus employed distinct strategies to pursue the overarching goal of
sovereignty in different institutional venues. Since the U.S. government
dominated the FTAA negotiations, he sought to limit the scope of those
talks and bolster Brazils position by forming an agreement with the EU. In
the WTO negotiations, he emphasized alliance building to pressure gov-
ernments in the global North to open their markets to the global South.
Lula initiated a dialogue with South Africa and India, sparking the for-
mation of the Group of 22 (G-22) alliance of delegations from 22 countries
at the WTO meetings in Cancun, Mexico in September of 2003. The G-22
voiced opposition to the neoliberal trade agenda within the WTO, critiquing
it for perpetuating world hunger and inequality, as well as a lack of tech-
nological development and cooperation to benet countries in the global
South. The G-22 successfully challenged the neoliberal globalization agenda
at Cancun. The WTO talks collapsed, since neither the G-22 nor the U.S.
government and its allies would make sufcient concessions to warrant
continued negotiations.
Yashwant Sinha, the Indian Finance Minister, explained the significance

of the G-22 alliance, stating, We have thought enough about South-South
cooperation and we have reached this stage now where we want to give it a
concrete shape (Greider & Rapoza, 2003, p. 11). Lula echoed similar
themes in his speech at a parliamentary meeting on the FTAA in October of
2003, where he described the creation of the G-22 as an extraordinary new
political phenomenon, not because of what was achieved there, but because,
for the rst time, a group of countries sharing certain similarities in terms of
their economies and their social problems discovered it was necessary to
unite in order to try to make the rich countries open up a little space for us
In this speech, Lula used the free-trade discourse to articulate his strategy
for sovereignty by expressing his support for free trade and advocating
Latin American countries having policies in common to push for access to
markets in the global North. In the process, Lula exposed the U.S. and EU
efforts to dene neoliberal trade regimes in terms favorable to their eco-
nomic interests. He articulated the conicting interests between the U.S., the
EU, and governments in the global South. He argued that the U.S. and the
EU have dominated world trade debates and asserted their economic in-
terests at the expense of farmers, a range of business sectors, the middle
classes and the poor in the global South. He emphasized the importance of
understanding that trade politics are about more than economic interests,
since conditions of international trade are powerful forces shaping social
issues of hunger and inequality on a global scale (http://www.brazil.org.uk/
page.php?cid=1764).
Lulas use of the free-trade discourse was a politically creative and astute
strategy to struggle for economic and political sovereignty for countries in
the global South. It t with Foucaults (1978, p. 100) argument that we
must not imagine a world of discourse divided between accepted discourse
and excluded discourse, or between the dominant discourse and the dom-
inated one; but as a multiplicity of discursive elements that can come into
play in various strategies. Indeed, the advocacy of free trade was a vital
discursive element used in distinct, opposing ways in the strategies of the
Brazilian and U.S. governments during negotiations over the WTO and the
FTAA in the early 2000s.
Lulas remarks highlighted the importance of developing political unity
among countries from the global South to acknowledge and defend their
common economic and social interests in the context of neoliberal global-
ization, however, they misrepresented the novelty of the G-22 alliance. This
alliance was not the rst time that countries from the global South with
common economic and social problems united to defend common interests

in struggles with the global North (http://www.brazil.org.uk/page.
php?cid=1764).
Indeed, there was a vital history of alliance formation by governments in
the global South to forge alternatives to the neoliberal globalization agenda.
In 1955, the Non-Aligned Movement of Asian and African governments
called on the powers of the global North to recognize their concerns that the
dominant model of economic development subverted their ability to make
economic, political and social choices. In 1974, the G-77 Third World states
proposed radical changes to strengthen their position in global trade and
development by creating a New International Economic Order (NIEO).
These changes included increased transfer of technology, improved access to
international nancing and terms of trade for mining and agricultural
products, as well as opening markets in the global North to industrial ex-
ports from the global South (McMichael, 2004). This last demand reveals
the historical roots of contemporary struggles over the politics of global-
ization, and particularly Lulas strategy to use the free-trade discourse to
pursue sovereignty for the global South.
Brazil and Indias leadership of the alliance within the WTO was rem-
iniscent of a struggle in the 1980s. From 1984 to 1986, Brazil and India led a
group of 10 delegations (the G-10) from the global South to oppose U.S.
government efforts to expand the purview of the neoliberal GATTrade from
the regulation of trade in goods to trade in services. These delegations rep-
resented Argentina, Cuba, Egypt, Nicaragua, Nigeria, Peru, Tanzania and
Yugoslavia. They favored greater government control over services, and
were concerned that being pressured to open their markets in areas like
banking and insurance would exacerbate their comparative disadvantages in
the services elds.
By contrast, the U.S. delegation led a group including Canada, the United
Kingdom, Sweden and Japan to push for incorporating the regulation of
services trade directly under the GATT trade regime, and accomplishing this
shift at a rapid pace. The U.S. government pressured the members of the
G-10 by threatening to withdraw their tariff preferences unless they changed
their positions and supported inclusion of services trade within the GATT.
Schoonmaker (2002, p. 63) described the reaction of the Reagan adminis-
tration to this struggle; quoting Clayton Yeutter, the U.S. Trade Repre-
sentative, who stated that [w]e simply cannot afford to have a handful of
countries, responsible for 5 percent of world trade, dictate the destiny of a
large number of countries who deal with 95 percent of that trade. After
intensive and protracted negotiations culminating at the end of 1988, the
U.S. government and its allies successfully established the GATT as the
international regime governing trade in services. Its neoliberal regime pro-
moting free trade in goods, opening markets throughout the world to global
capital, was extended to cover the expanding markets for trade in services
(Schoonmaker, 2002; Aronson & Cowhey, 1984; Nicolaides, 1989; Bhalla,
1990; Marconini, 1990; Kakabadse, 1987).
The Bush administration employed similar tactics in response to the
G-22s efforts at the WTO meetings almost two decades later. Robert
Zoellick, the U.S. Trade Representative, characterized the collapse of the
WTO talks in Cancun as the fault of the intransigent G-22 delegations.
Roundly criticizing Brazil as the leader of the alliance of wont do
countries, he stated that the U.S. government would move towards free
trade with can-do countries (http://www.investmentwatch.org/articles/
ft11january2004.html). Similar to the actions during the GATT negotia-
tions, U.S. Trade Representative Zoellick stated that the U.S. would make
advances on multiple fronts (The Economist, 2003, p. 35) by cutting off
bilateral trade negotiations with wont do countries remaining within the
former G-22 alliance and formulating either bilateral or regional alliances
with can-do countries. In a similar vein, Charles Grassley, the chairman
of the Senate Finance Committee, expressed doubts that any member of the
G-22 would be able to negotiate a bilateral trade deal with the U.S. gov-
ernment (The Economist, 2003, p. 35).
Tensions between the U.S. and Brazilian governments ared in the wake of
the WTO talks collapse. The Folha de Sao Paulo, a major Brazilian news-
paper, accused the U.S. Trade Representative Zoellick of making an open
declaration of war against Brazil (Greider & Rapoza, 2003, p. 12). Brazilian
foreign minister Celso Amorim critiqued the U.S. Trade Representative
Zoellick for making threats against U.S. trading partners in the WTO (The
Economist, 2003, p. 35). In an interview with a Newsweek reporter, Amorim
stated that the delegates were making progress and ready to negotiate
amendments on agricultural subsidies (http://www.brazil.org.uk/page.
php?cid=1759) when the U.S. and other Western nations insisted on dis-
cussing rules concerning government procurement, competitiveness and trade
nancing, the so-called Singapore issues. In Amorims view, [n]o one
benets by saying, OK, now we will only pursue bilateral trade agreements.
There is no substitute for the WTO (http://www.brazil.org.uk/page.
php?cid=1759). Indeed, Amorim viewed Cancun as a victory for Brazil, since
[w]e were able to cut our lossesythe proposal by the United States and European
Union, would have meant greatly scaling back expectations from previous talks in Doha.
The Brazilian delegation decided that the limited gainsywere not worth it. This was not
obstruction. It was a deliberate position. And if we all take care not to let ourselves get
carried away by emotions, we have the basis to continue negotiating. We achieved a
political victory. Despite the initial resistance, we were treated as a legitimate negotiating
party, not as a grouplet of countries over in the corner shouting and creating obstacles
This victory, however significant, was a single battle in a longer struggle to

forge an alternative to the neoliberal globalization agenda. As such, this
victory sparked resistance and conict. The U.S. government pressures in
the wake of Cancun shook the alliance of delegates from the global South.
In the weeks following the united stand against the neoliberal trade agenda,
the Group of 22 shrunk to 12 members. Central American and Caribbean
governments left the coalition after they were threatened with the loss of
trade preferences with the U.S. government. Peru, Colombia, Paraguay and
Uruguay soon followed. Colombian President Alvaro Uribe expressed
hopes that his government would enter negotiations over a bilateral trade
deal in the wake of that decision (Greider & Rapoza, 2003; The Economist,
2003).
Despite these effects of the U.S. pressure on small countries more vul-
nerable to losing their ties to the U.S. markets, the initial formation of the
G-22 highlighted the breadth of opposition to the neoliberal trade agenda
championed by the U.S. government. Federico Cuello, former WTO am-
bassador from the Dominican Republic, stated that Brazil embodies the
hope of countries like the Dominican Republic, showing that you can still
have dignity at the negotiating tabley . I doubt that Lula, who has massive
public support and a top-notch Cabinet, will be intimidated (Greider &
Rapoza, 2003, p. 12). The fact that delegations left the G-22 revealed their
vulnerability to political pressure. The prospects for resistance to the neo-
liberal trade agenda remained, however, as Lula and his allies from the
global South continued to strategize their next moves.
Indeed, the U.S. government was far from wholly successful at stiing the
opposition. Five months after Cancun, in the context of national and inter-
national resistance to the U.S. governments neoliberal agenda, the Bush
administration shifted to a more conciliatory stance. The U.S. Trade Rep-
resentative Zoellick characterized the U.S. government as trying to reach out
to developing countries http://www.investmentwatch.org/articles/ft11jan-
uary2004.html) by addressing the issues of agriculture and investment, as
well as backing a candidate from the global South as incoming chair of the
WTO general council. Zoellick expressed this pacificatory stance by stat-
ing that [w]ere trying to provide constructive leadership (http://www.
investmentwatch.org/articles/ft11january2004.html) rather than dictating the
terms for global trade talks. He crafted a letter, trying to make some sug-
gestions without crossing the line of creating controversy over specifics,
suggesting options for how to proceed with the WTO talks (http://www.
investmentwatch.org/articles/ft11january2004.html).
Zoellicks remarks suggested that he recognized the depth of the conicts
between its position and that of the delegations from the global South, as
well as the unlikelihood of resolving them in time to complete the talks by
the original deadline of January 2005. Indeed, the change in the U.S. gov-
ernments position supported Lulas characterization of the G-22 as an
extraordinary new political phenomenon (http://www.brazil.org.uk/page.
php?cid=1764). What was extraordinary about the G-22, however, was not
the process of alliance building among delegates from the global South to
articulate their interests in a global trade forum. The unusual quality of this
alliance was its success in pressuring the U.S. government to make conces-
sions both in terms of specific trade issues and in terms of the overall process
and timetable of the trade negotiations. For example, the U.S. Trade Rep-
resentative Zoellick expressed his willingness to reconsider the timing of
reductions in industrial and agricultural tariffs, as well as particular de-
mands by African delegations to reduce cotton subsidies (Alden & Barber,
2004).
The Bush administrations changed negotiating stance revealed the extent
of U.S. interests in concluding the Doha round of the WTO talks. As Held
(2000) argued, transnational networks and regimes have become increas-
ingly important under contemporary conditions of globalization; so impor-
tant that even dominant states like the U.S. must engage with them. Such
engagement is particularly vital on trade issues like agricultural subsidies
that involve changing the trade policies of a wide range of government.
Indeed, Jagdish Bhagwati (2004), a Columbia economist and External Ad-
visor to the Director General of the WTO, argued that multilateral trade
negotiations were the only effective way to address such issues. Bhagwati
(2004) criticized the G-22 for their unwillingness to reduce their own re-
strictions on agricultural trade, and was equally judgmental of the U.S.
government for negotiating bilateral deals in the wake of the Cancun talks
collapse. He viewed this collapse as a stepping stone to a successful con-
clusion of the Doha round, however, since none of the parties involved
could successfully meet their objectives without this multilateral forum
(Bhagwati, 2004, p. 52).
As discussed above, Brazilian Foreign Minister Celso Amorim expressed
a similar view of the importance of multilateral trade negotiations as
indispensable for resolving issues such as trade in agriculture. Minister
Amorim had a vision of the importance of alliances between delegations from

the global South as a vital part of these negotiations, however, which differed
from Bhagwatis (2004) view that it is necessary to work within the multi-
lateral structure of the WTO to forge accords including so many parties.
Bhagwati (2004) thus emphasized the constraints of structural forms, while
Amorim highlighted the relationships between participants as a shifting, dy-
namic force shaping the negotiating process. Indeed, decades of participating
in multilateral trade negotiations never guaranteed governments from the
global South that their interests would prevail in the nal agreements. The
prospects for pursuing these interests were forged through ongoing processes
of struggle and alliance building. The difference between Bhagwatis (2004)
and Amorims views was revealed in Amorims comments after WTO ne-
gotiations resumed in Geneva in August 2004; where he cited a new dy-
namic within the WTOy. This new multipolarity is important because
without it the notion of a multilateral trade system, represented by the
WTO, would be a ction (http://www.brazil.org.uk/page/php?cid=1877).
True multilateralism, or multipolarity, thus required active participa-
tion by delegations from the global South. This multipolar dynamic arose
with the reemergence of the G-22 at Geneva. They made proposals and won
inclusion of an agreement by all 147 members of the WTO to eliminate
agricultural export subsidies. This agreement reected the continuing vital-
ity of the G-22 alliance as a force pressing the interests of governments in the
global South within the WTO. Its success was limited, however, since no
decision was made about when the elimination of subsidies would begin or
how this process would be implemented (http://www.brazzil.com/2004/
html/articles/aug04/p105aug04.htm). The struggle to open agricultural mar-
kets in the global North to farmers from the global South thus continued to
infuse trade debates and the politics of globalization.
CONCLUSION
The Brazilian governments shifting strategies of sovereignty, from a na-

tionalist effort to restrict access to Brazilian markets in the informatics
sector in the 1970s and the 1980s to an internationalist struggle to open
markets in the global North to agricultural products in the early 2000s,
reveal key dynamics in the process of globalization. Indeed, the informatics
strategy involved pursuing national development, and a long-range vision of
national sovereignty through greater local control over conditions of
development, by ghting the neoliberal globalization project of opening
markets around the world to global capital. This earlier strategy employed a
discourse of national sovereignty and an oppositional stance toward the
U.S. government and its efforts to promote the neoliberal agenda. Decades
later, however, conditions of globalization are characterized by the increas-
ing importance of international actors and the difculty of pursuing sov-
ereignty through nation states acting alone (Held, 2000). In this changed
context, Lula initiated a politically insightful and creative process of crafting
a strategy that retained the broad commitment to sovereignty, both within
Brazil and throughout nations in the global South, by rearticulating these
nationalist goals in internationalist terms.
Lulas emergent internationalism stressed economic development as mul-
tidimensional, inextricably linked to cultural norms and forged through
political and discursive processes. In his speeches to various international
audiences, from the European Union Business Forum to Parliamentary
Meetings on the FTAA, Lula highlighted the implications of trade and
development policy for conditions of global inequality and particularly for
the worlds poor. His call to craft a trade and development agenda that
would eradicate hunger as a weapon of mass destruction demanded inven-
tive experimentation from all parties involved in international negotiations
such as the FTAA and the WTO.
Such an approach is emergent, in Williams (1977) terms, because it in-
volves the development of new practices, values, relationships and kinds of
relationships that are repressed, opposed, and indeed, unrecognizable by the
dominant form. It contradicts the dominant neoliberal view that markets
operate according to objective economic laws that must be obeyed to ensure
the efcient functioning of the global economy. By contrast, Lulas emer-
gent internationalism views cultural norms as embedded in all trade and
development policy decisions; thus emphasizing a cultural, normative di-
mension to economic policies and practices that the dominant neoliberal
model cannot recognize or support. Indeed, if trade and development pol-
icies are assumed to be governed by objective laws outside cultural inuence,
then a normative approach such as Lula advocates is inconceivable and
repressed. Lulas emergent approach calls on policymakers to make the
norms upon which their strategies are based explicit by facing their impli-
cations for the worlds poor. This stance resonates with social groups and
movements both within Brazil and in the broader altermondialiste move-
ment, although potential allies on the left critique Lula for repackaging
neo-liberalism as the way to help the worlds poor. (http://www.zmag.org/
content/showarticle.cfm?SectionID=1&ItemID=7197).
Lulas strategy for sovereignty was more complicated, however, involving

both the use of the free-trade discourse combined with alliance-building in
the institutional context of the WTO, and the struggle against that discourse
in the U.S.-dominated FTAA. Through this complex and contradictory
strategy, Lula demonstrated that, under contemporary conditions of glo-
balization, traditionally nationalist goals of economic and political sover-
eignty can more effectively be pursued through an internationalist strategy
of alliance building among governments in the global South. Such a strategy
creates possibilities for governments in the global South to both increase
their trade with each other and forge alliances to demand access to markets
in the global North. These alliances created the dynamic of multipolarity
within the WTO, where the G-22 is struggling to transform the agenda to
benet economic interests in the global South.
The consequences of this struggle, and of Lulas emergent internation-
alism, remain to be seen. The G-22s actions at Cancun and Geneva suggest,
however, that the strategy of pressing governments in the global North to
open their markets to the global South can catalyze alliances between these
historically disenfranchised populations, creating conditions to pursue their
sovereignty in dynamic, venturesome ways. By infusing trade debates with
questions about their implications for social justice and the worlds poor,
and thus calling for a new moral economy, Lulas emergent internationalism
makes a vital contribution to this process.
NOTES
1. The French term altermondialiste conjures images of people building alternative
worlds, which are not adequately captured by the English translation as the anti-
globalization movement.
2. In a similar vein, the WTO issued a preliminary ruling that the EUs 75% tariff
on salted chicken imports from Brazil was protectionist (http://oglobo.globo.com/
online/default/asp).
ACKNOWLEDGMENTS
I would like to thank Philip McMichael for his valuable comments and
Michael Thoeresz for his research assistance on this project.
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CONTENTS

LIST OF CONTRIBUTORS vii

DEDICATION: TO FREDERICK H. BUTTEL xi

PART I: NEW RESEARCH AGENDAS IN THE ERA OF

NEW DIRECTIONS IN COMMODITY CHAIN

TRANS-LOCAL AND TRANS-REGIONAL

CHANGING RURAL SCENARIOS AND RESEARCH

CONQUERING, COMPRADOR, OR COMPETITIVE:

PROMOTING SUSTAINABLE DEVELOPMENT:

STATELESS REGULATION AND CONSUMER

PART III: STRATEGIC QUESTIONS AND GLOBAL

THE POVERTY OF RESOURCE EXTRACTION

FROM COLONIALISM TO GREEN CAPITALISM:

GLOBAL DEVELOPMENT AND THE CORPORATE

SHIFTING STRATEGIES OF SOVEREIGNTY:

Stephen G. Bunkery Department of Sociology, University of

Norman Long Wageningen University, Wageningen,

This edition of Research in Rural Sociology and Development is dedicated to

and Global Modernity (2000), Sociological Theory and the Environment

While some researchers have considered commodity chain analysis to be a

INTRODUCTION: A METHOD WITHOUT A THEORY?

Commodity chains have always been central to development discourse.

New Directions in the Sociology of Global Development

underdevelopment took the unequal terms of these commodity exchanges,

commodity systems analysis owes much to neo-Marxist labor process

COMMODITY CHAIN ANALYSIS AND THE CRISIS

COMMODITY CHAIN ANALYSIS AND

capitalism as the heroic/tranformative agent of development and moder-

regimes stands alone, within political economy, in acknowledging gendered

continued tendency, in commodity chain research, to reify corporate ac-

COMMODITY CHAIN ANALYSIS AND ECONOMISM

numbers of women working outside the home, the loss of family-based

COMMODITY CHAIN ANALYSIS AND

that reinscribed inequalities after the dismantling of colonial rule. Julie

Liz Claiborne in New Jersey to a factory oor in Aguascalientes, Mexico.

I began by suggesting that the growing popularity of commodity chain anal-

These accounts are likely to be more fragmentary in their exposition,

This chapter explores the trans-national and cross-regional interactions and

New Directions in the Sociology of Global Development

LOCAL RELATIONS OF POWER IN EUROPE

Distinctions are conventionally drawn between class structures in different

THE TRANS-LOCAL STRUCTURE OF INDUSTRIAL

In the eighteenth century Britain, entrepreneurs sought to escape gov-

Europes Transnational Industrial Expansion

States in Europe were built up within a pre-existing, region-wide system of

The late eighteenth century industrial revolution in Europe did not

dominant classes had achieved through a century or more of struggle

The European Model of Industrial Capitalist Expansion:

exhausted as a market for goods and capital, Britains domestic economy

Therefore, It is not industrial progress that demands the opening up of

(1978, p. 163). Decisions about whether and how to increase or restructure

The development of exogenous demand and consumption through the

The Circuit of Capital: The Nineteenth Century Origins of

Europes economy before World War II was based on the development of

rye, celebrated, in 1879, along with the enactment of an Anti-Socialist Law

the extensive and costly empire remained a permanent object of discus-

WHAT CHANGED AND WHY

rights. Serfdom was abolished in Prussia concurrently with Steins military

volunteers signed up before conscription began in January 1916; by the