World Watch Magazine: May/June 2005

“FARMING’S NEW FEUDALISM” BROUGHT ABOUT BY BIOTECHNOLOGY AND SEED PATENTS

Plus Corporations and Society, Forests that Matter, and More in World Watch magazine’s May/June 2005 issue

World Watch Cover Washington, D.C. – Feudalism has come full circle for Percy Schmeiser, writes Robert Schubert, editor of the online news service Crop Choice, in “Farming’s New Feudalism” (World Watch, May/June 2005).

Karl and Anna Schmeiser, Percy Schmeiser’s grandparents, left 19th century Germany—where they worked a baron’s vast tracts of land in order to shelter and feed their family—for the New World, where they settled in the prairies of western Canada. These days, however, farmers on those prairies are not finding the independence Karl and Anna did. They are struggling to keep their livelihoods in the face of industrial agriculture, which has steadily consolidated its power through various strategies including the commodification of seed. “It’s as if the barons have arisen from the grave and brought the old feudal system back with them,” Schubert quotes Schmeiser.

Until recently, agriculture was more a way of life than an industry. Up until the 1970s, public institutions licensed seed companies to sell to farmers and usually claimed a royalty, and farmers were permitted to save successive generations of seed for planting on their own farms. Patents changed this relationship; when coupled with contracts that enforced the patent rights, they provided the means of legal control over seeds needed to increased profits for the burgeoning multinational biotechnology industry, which was busy absorbing seed companies.

Using biological means (genetic engineering) and social means (patenting), agriculture giants further consolidated their power and bolstered their bottom lines. The effects have been disastrous for farmers, who are now hampered by legal actions such as those suffered by Schmeiser, argues Schubert. Monsanto has sued 90 farmers in 25 states and won over $15 million in judgments for breach of contract or patent infringement. Monsanto sued the Schmeisers after seeds from their canola harvest were found to contain the company’s Roundup Ready genes. (Schmeiser had learned that the stray plants growing in ditches on his property contained Monsanto’s genes, yet he saved and replanted seed from his harvest without informing Monsanto. In May 2004, the Supreme Court of Canada ruled that he had infringed the patent on the gene because it was present in the seed from his field. However, it was ruled that Schmeiser owed Monsanto none of his profits because he had not made money from its patented invention.)

Schmeiser fears for the future of North American and world agriculture. “Farmers are going out of business....The corporations are becoming the barons and the lords, which are what my grandparents thought they’d escaped.”

TOWARDS A MUTUALISTIC PARADIGM: CORPORATIONS AND SOCIETY

“The term ‘hosts’ hints at a biological metaphor—symbiosis—that is useful in describing the relationships between corporations and the societies in which they are embedded,” writes Worldwatch researcher Erik Assadourian in his article, “When Good Corporations Go Bad,” the first in a series on the evolving corporation.

Assadourian looks at the evolution of the modern corporation by comparing its relationship to society with the mutualism and parasitism found in nature. “Interestingly, mutualistic relationships are not stable endpoints in evolution....Parasitism itself is no more stable an endpoint than mutualism, however—perhaps less so in the case of corporations and human society, whose current relationship could lead to the destruction of one or both symbionts.”

If corporations precipitate a decline in the environment, they could cause irreparable damage that could trigger a decline in human society. Or the societal host, infuriated by looming ecological collapse and social injustice, could revolt and purge the corporate parasites from its body. “This too would be costly,” writes Assadourian.

He points to the American Revolution, in which a series of laws, including the Townshend Acts and the Tea Act of 1773—which essentially granted the East India Company a tax-free tea monopoly in the American colonies—incited the colonists to revolt against England and form a new republic in which the role of corporations was significantly restrained.

Evolution of the modern corporation has increasingly led to a more parasitic form of relations between corporations and their societal hosts, according to Assadourian. With shareholder pressures and other demands, “most corporations today focus almost entirely on maximizing profits for their shareholders, and they do so primarily by externalizing as many of their social and environmental costs as possible.”

On the upside, whether out of self-interest or broad concern, a number of corporations are starting to move towards a more mutualistic relationship with society. Later installments of the series on the evolving corporation will explore how this is happening in further detail.

DO WILD FORESTS MATTER?

In “The Shape of Forests to Come?” Karen Charman shows how biotechnology and forestry are converging to the possible detriment of natural ecosystems. Large gaps in scientific understanding of forest ecosystems make it difficult to predict, or even recognize, the wider impact of engineered trees, writes Charman: At a recent conference in North Carolina, one supporter of genetically modified trees admitted, “We don’t know a few important things…We don’t know what a genome really is.”

Charman notes that although experts are familiar with the adverse impacts of genetic modification on agriculture, the effects on forestry could be massive in comparison. “Because of the size of trees, the amount of seeds and pollen they produce, and the updrafts that occur in forests and tree plantations, the scale of gene flow among trees is ‘unprecedented’ compared to food crops,” says one source.

Forests host much of the planet’s biodiversity, protect watersheds and provide clean drinking water, and remove carbon dioxide from the atmosphere. “A key question as we consider genetically engineered forests is what to do to preserve wild forests, and who gets to decide,” writes Charman.

GREEN GUIDANCE

Mindy Pennybacker, Molly Rauch, and Claire Gutierrez look at the toxins found in sunscreens, sunblocks, chapsticks, skin creams, and insect repellents and give tips on how to avoid everything from chemical skin irritants to products that affect the health of aquatic ecosystems long after washing off, or worse—products such as DEET, found in insect repellants, have resulted in death with over-application.

ENVIRONMENTAL INTELLIGENCE

Organic Farming Pays: A recent study suggests that organic farming is expanding rapidly in Asia because organic farmers can make more money. Furthermore, because organic agriculture is labor intensive, it offers job opportunities in areas of high unemployment. On the downside, the farmers benefiting from the increase in organic production are those already producing for export. The study concludes that while it is no panacea, organic agriculture can provide a long-term solution to poverty, reduce migration, and improve health conditions and the environment for entire communities.

Healthy Coastlines Mitigate Disasters: Studies on the impacts of last December’s Indian Ocean tsunami point to the vital role healthy coastal resources play in reducing disaster risks. While natural barriers, including coral reefs, mangroves, and sand dunes, helped mitigate the devastation of the waves, in areas where natural defenses had been degraded by development, shrimp farming, coral mining and other human activities, damage and loss of life were much greater. Unfortunately, these resources were also damaged in the disaster.

UNOCAL Settles in Burma Human Rights Case: Thanks to a suit brought under the Alien Tort Claims Act—a law created by the first U.S. Congress in 1789—a group of Burmese villagers learned late last year they would be compensated for human rights abuses carried out by soldiers hired by a multinational energy company to guard construction of its pipeline in the country. Experts believe this could open the door for other such cases, and significantly alter the way corporations do business.

Nordic Countries Are World’s Sustainability Leaders: Finland, Norway, Sweden, and Iceland ranked among the five most “sustainable” countries in the 2005 Environmental Sustainability Index (ESI) released in January. The ESI rates nations on their ability to integrate economic and human development with sound natural resource management, and the Nordic countries were noted in part because of their low population densities, ample natural resources, and successful management of environment and development concerns.

Everybody Talks About the Weather…and Now They’re Suing, Too: This month, the first lawsuit concerning climate change is due to be argued in U.S. District Court, asserting that the U.S. Export-Import Bank and Overseas Private Investment Corporation failed to assess the contribution to global warming of numerous fossil fuel projects financed with tax-payer money. Many think that climate litigation will follow the path of tobacco lawsuits—perhaps taking time to garner a win, but meanwhile raising public awareness, driving markets to consider climate issues and risks, and encouraging federal leadership.

MATTERS OF SCALE:
FOOD CONCENTRATES

Share of world’s top 100 national (as GDP) and corporate (as revenues) economies that are corporations, 2003 — 51

Rank of Belgium among top 100 economies, 2003 — 18

Belgian GDP, 2003 — $248 billion

Rank of Wal-Mart among top 100 economies, 2003 — 19

Wal-Mart revenues, 2003 — $247 billion

* * *

Worldwide revenues of seed companies, 2002 — $23 billion

Percent of total accounted for by the top 10 companies — 31

Worldwide revenues of agrichemical companies, 2002 — $27.8 billion

Percent of total accounted for by the top 10 companies — 80

Worldwide revenues of the top 30 food retailers, 2001 — $1 trillion+

Percent of total accounted for by the top 10 companies — 57

Percent of total accounted for by the biggest food retailer, Wal-Mart — 21

* * *

Number of 33 U.S. food processing industries in which consolidation from 1973 through 1992 led to lower consumer prices — 4

Number in which the effect was zero or unknown — 6

Number in which it led to higher prices — 23

Percent of total price-fixing fines worldwide paid by food and agriculture cartels in recent years — 85

* * *

Retail price of bread made from one bushel of wheat in Canada, 1975 — $30

Farmers’ price for one bushel of wheat in Saskatoon, Canada, 1975 — $3

Retail price of bread made from one bushel of wheat, 1999 — $90

Farmers’ price for one bushel of wheat, Saskatoon, Canada, 1999 — $3

Sources: Size and rank of economies, and agricultural industry revenues and shares: ETC Group, “Oligopoly, Inc.” (Communiqué #82); food industry consolidation’s effect on prices: A.M. Azzam, “The Effect of Concentration in the Food Processing Industry on Food Prices,” Center for Agricultural and Food Industrial Organization, University of Nebraska/Lincoln; bread and wheat prices: National Farmers Union (Canada), “The Farm Business, EU Subsidies, and Agribusiness Market Power.”

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