U.S. GRAIN ARSENAL
NACLA
Introduction The United States' control over the world grain trade is greater than the dominance of the OPEC nations over oil. With three-fourths of the world's net grain exports coming from the...
...The leading grain trader, Cargill, also proved to be one of the leading beneficiaries...
...In July 1972 Continental Grain Co...
...This change is reflected in the Administration's food aid plans...
...THE CCC Another little-known device in the U.S...
...The fact that it takes 21 pounds of grain protein to produce 1 pound of beef protein fits right in with the Agriculture Department's objective of expanding the demand for surplus U.S...
...9. Harry Fornari, Bread Upon the Waters, Aurora Publishers Inc., Nashville, Tenn., p. 93, pp...
...Realizing that prosperous export markets could only develop if the major economies of the world were rebuilt, the United States used first the United Nations Relief and Rehabilitation Administration (UNRRA) and then the Marshall Plan to send unprecedented quantities of grain to the European and Asian nations...
...For decades, Cargill has enshrouded itself in a veil of secrecy precisely to ward off this possibility: it realizes that publicity about the company's operations can only lead to increased public hostility...
...And PL 480 also become an increasingly important element in U.S...
...KISSINGER'S FOOD DIPLOMACY In the early 1970s, food aid assumed a new significance in U.S...
...THE FOOD WEAPON "Mightier Than Missiles" In the midst of the widespread famine of recent years, it has become dramatically clear that the United States will use its agricultural abundance not to alleviate starvation, but to further its own imperial interests...
...The export drive contributed to food price inflation of 20 percent in 1973...
...1965 Canada Poultry breeding Purchased Canadian-based Shaver Poultry, with subsidiaries in England, Germany, Sweden, India, Barbados, Pakistan & Japan...
...264 388 People's Republic of China...
...exports in 1972 was partly due to a decline in world grain production and the large Soviet purchases, devaluation greatly stimulated demand for U.S...
...Thus a large grain company with advance knowledge, or the ability to project the movement of the market, will profit from the futures contract, while the farmer is least likely to come out ahead...
...See also Don Mitchell, The Politics of Food, James Lorimer & Co., Toronto, 1975, pp...
...Under Title II, the U.S...
...By 1962, Cargill, through its wholly owned Nutrena* subsidiary, operated 27 domestic feed mills, and in addition owned 14 vegetable oil processing plants...
...Two Born brothers were recently kidnapped by Argentine guerrillas, and released in exchange for a $60 million ransom...
...The claim by Administration officials that they were caught unawares by the enormous size of the Soviet purchase is not supported by the evidence...
...government, it by no means restricts the political usefulness of PL 480...
...In 1973, its fishmeal plant in Peru was expropriated, and in Argentina, the increasing radicalization of the country has caused Cargill to curtail its activities...
...See Kissinger's speeches of May 28, 1975 and October 2, 1975...
...2 5 Cargill is already laying plans for the end of government export controls: late in 1974 it purchased National Grain Limited, a Canadian company with 268 local elevators and a large grain terminal...
...The attitude of U.S...
...But even with an investment of several hundred thousand dollars, and hundreds or thousands of acres, the grain farmer is caught between the banks and the corporations that provide capital inputs on one end, and the grain monopolies on the other...
...4 9 Cargill's financial statement for 1973 reveals that the company's net assets increased from $246 million to $352 million, an increase of over 40 percent...
...See also "Christian Missions for the Empire," NACLA's Latin America and Empire Report, December 1973...
...grains...
...6 To carry out the export drive envisioned in the Williams report, U.S...
...Aside from Cargill's special ties with Chase, company executives also sit on the boards of banks in the Minneapolis area...
...and Daniel Balz, "Economic Report/ Exports, High Food Prices Boost Administration Efforts to Reverse Farm Policy," National Journal, February 24, 1973...
...Not only did the United States deny food aid credits, but shortly before the coup a request from the Allende government to purchase U.S...
...power...
...agricultural exports, wheat and flour, jumped from 48 million bushels in 1944 to 503 million in 1948!9 PL 480 Although the U.S...
...power that would result from the cooling of the world's climate which is predicted by some climatologists...
...flag vessels, in response to demands by the maritime unions...
...Ibid...
...list of Most Seriously Affected nations...
...As one Senate aide who has investigated the trade noted, "by controlling the inspectors, the companies control the price mechanism...
...egg business 1966 Holland Soybean plant Pre-1969 El Salvador Feed plant 1969 South Korea Integrated feed, poultry, and egg operation 1970 France Soybean plant Joint venture with European firms...
...7 The key officials serving under Butz at the Agriculture Department were even more directly tied to the trade...
...workers to relend to large corporate interests, including the grain companies...
...In the past twenty years, approximately $25 billion worth of commodities have been shipped abroad under PL 480 to serve a variety of U.S...
...capitalism-problems that lead to the progressive weakening of the system...
...volumes of grain in relatively short periods of time, the subterminal elevators are used by Cargill to bypass the country's elevators that are often under the control of local cooperatives...
...Projected country spending levels for PL 480 are contained in the annual AID Program Presentation to Congress...
...As one African official noted, "Thieu and Lon Nol receive millions of dollars...
...Three years later, most of Cargill's properties were placed in receivership, and the Cargill grain merchandising empire appeared to be on the brink of dissolution...
...The consequence of U.S...
...empire and to aid the international expansion of the corporations...
...food aid flowed into Europe as part of the effort to bolster the area against Communism.4 The passage of Public Law 480 in 1954 signalled a new era in U.S...
...Dan Ellerman, the National Security Council representative on the Inter-agency Staff Committee that oversees PL 480, made this remark at a secret Committee meeting...
...With American production unlikely to be affected by this trend, the CIA speculates that "as custodian of the bulk of the world's exportable grain, the U.S...
...strategy of maintaining a low-profile, non-official presence in Chile...
...The export drive must go on, but at the same time constantly rising food prices continue to undermine the position of poor and working people around the world...
...In an attempt to coerce the oil rich nations to recycle their petrodollars by financing U.S...
...Expropriated in 1973...
...While small Title II donation programs under the voluntary agencies continued, this was in keeping with the U.S...
...This in turn eliminated a key provision in the licensing requirement that 50 percent of exports be shipped on U.S...
...Increasingly, Third World countries are demanding not only control of their resources, but also a basic restructuring of the international economic system that serves the interests of developed capitalist countries, particularly the United States, at the expense of the Third World...
...The Big Five and PL 480 Exports of Grains and Vegetable Oils Under Title I, PL 480 (Figures in Thousands of Dollars) 1972-74 1954-67* Cargill 151,363 1,572,968 Cook Industries 143,616 158,249** Continental Grain 140,889 1,626,472 Louis Dreyfus, Inc...
...8 The company established feed milling and vegetable processing divisions that moved into domestic manufacturing, and it also built tankers for the Navy and Army...
...Maritime hostilities ended direct private grain exports, and the government stepped in to regulate the domestic grain market as well as other sectors of the economy...
...food exports...
...Coffee, and the Bechtel Corporation...
...Ibid...
...client regimes (as in South Korea...
...At the same time, the United States faced new challenges from Third World nations, especially the OPEC countries, who moved to assert greater control over their natural resources...
...Nixon's turnaround had an immediate impact: in November 1971 the Soviets purchased 3 million tons of U.S...
...3. Interview with former employee of Cargill...
...These companies control export-import facilities in Europe, operate large shipping and transportation networks, have close relations with European bankers, and even own manufacturing subsidiaries in Europe that process imported grain...
...foreign policy is clear...
...This pressure for profit translates inexorably into rising food prices.7 "Our primary concern is commercial exports...
...After his defeat in the California gubernatorial race in 1962, Nixon went to work for the Wall Street law firm of Mudge, Stern, Baldwin & Todd, which counted Cargill among its corporate clients...
...trade crisis was competition from Japanese and European manufactured * By the State we mean the array of governmental and political institutions that help sustain capitalism...
...strategists sought desperately to prop up the tottering regimes in South Vietnam and Cambodia, PL 480 funds became a direct military subsidy for the Indochina war machine...
...Cargill also had interlocking directorates with some of the railroads...
...wheat exports tripled and corn exports increased by about 20 percent...
...policy has aimed first of all, at undermining the OPEC cartel...
...The State Department quickly mobilized to get around the 30 percent limitation on the political distribution of food aid...
...At the end of World War II, the U.S...
...4. Williams Report, op...
...Port facilities are frequently financed and constructed by urban port authorities which then lease them to the grain companies...
...In addition, the plan to overcome the U.S...
...1,195 1,310 Republic of Korea...
...Interview with Richard Bell, the Assistant Secretary of Agriculture for International Affairs and Commodity Programs...
...balance of payments...
...Washington Post, September 11, 17 and 18, 1975, and Reuters Wire Service dispatches...
...They're a way of life...
...creating new vegetable oil business in Spain and Holland...
...While the companies of European origin built elevators, terminals, and other marketing facilities in the United States similar to Cargill's, the native grain giant cornered a large share of the European market...
...There it forced out the old trading giant of the city, the Rosenbaum Grain Company, and soon became the largest grain merchant in the Chicago area...
...in times of short supply, it would allow the United States to meet commercial demand abroad, and yet be able to manage domestic inflation without having to resort to export controls...
...It dealt primarily in cotton trading until the early 1960's, when Edward "Ned" Cook, the head of the company, began diversifying...
...corporations to help them finance the establishment of new subsidiaries abroad.** A further use of counterpart funds was to provide "economic assistance" to U.S...
...export strategy, the vast Soviet market was finally opened...
...grain processors with an important market...
...In reality, the main beneficiaries are the U.S...
...By 1971, more than $1.7 billion had been spent in this way, with two thirds going to South Korea and South Vietnam...
...John H. MacMillan, a member of the prominent business family from LaCrosse, Wisconsin, married into the Cargill family in 1895 and soon assumed important administrative positions...
...A former president of General Mills summed up the attitude of Minnesota agribusiness interests toward Hubert Humphrey: "It's a lot cheaper to give Humphrey a few thousand dollars than to fund the Republican Party...
...To lay the groundwork for its response to the economic crisis, the Nixon Administration in May 1970 appointed a presidential Commission on International Trade and Investment Policy...
...economic and political interests around the world...
...2. United States International Economic Policy in an Inter dependent World, Report to the President submitted by the Commission on International Trade and Investment Policy (Washington, D.C.: July 1971...
...client regimes in Indochina has made South Korea more important than ever in holding the line against further losses in Asia...
...cit., p. 275...
...government in 1954 forged the perfect instrument for their continued expansion-Public Law 480.* * See part I above for a more extensive discussion of PL 480...
...cit., p. 205...
...8 Since 1971, the United States has insisted on dollar repayment of PL 480 credits, with the notable exceptions of Cambodia and South Vietnam...
...112-13...
...upgrading diets . . . raising new demands for the American farmer's crops...
...The companies can either sell the commodities and use the proceeds to finance their operations, or else use the commodities to supply their processing plants...
...arsenal...
...According to one company official, "Cargill wants to spread the risk base and the profit base...
...4. Harry Cleaver, "Will the Green Revolution Turn Red...
...In 1973, for example, the Duluth Port Authority and Cargill announced a $15 million project for constructing new port facilities...
...One loan for $500,000 came from PL 480 under the special provisions of the Cooley amendment...
...Within several years, Will was joined in the grain trading business by two of his brothers, and they built elevators and grain storage houses in Iowa, Minnesota, and Wisconsin...
...1964 Belgium Feed plant Part of the Hens companies acquired in 1964...
...working people...
...The companies would probably prefer to operate abroad without providing funds for kickbacks, but if such payments become necessary for closing an important grain deal, then the dictates of business require that the bribe be paid...
...It means developing markets...
...9 FOOD POWER IN CHILE Like other forms of U.S...
...One fb Secretary of Agriculture declared: "The p bureaucratic influence of the grain compare pervasive...
...Because Cargill in many cases controlled the only elevator at major railroad stops, the local farmers were often forced to accept the price offered by the company for their grain...
...Interview with vice president of Continental Grain...
...The men who run the enterprise keep a tight lid on its activities, permitting only an occasional article to be written by a trusted business journal or newspaper...
...diplomatic objectives...
...government is relying on the Soviet Union to provide a large and steady market for U.S...
...Interview with a Vice President of Continental Bank of Illinois...
...Although the company was not the leading exporter to the Soviet Union in 1972, the unloading of the large U.S...
...As the current Assistant Secretary of Agriculture said in an interview, "Our primary concern is commercial exports...
...political priorities...
...strategists do not see humanitarian food aid as something that will serve U.S...
...You're either going to pay or not do business...
...and its philosophy is reflected in the 1975 Economic Report of the President...
...Foreign Agricultural Policy, PhD...
...Interview with a retired Cargill official...
...With U.S...
...Although Cargill lost the legal battle when its Illinois subsidiary was excluded from trading on the Chicago market, it won the economic war, since the subsidiary was already in the process of dissolution and the parent company was able to continue expanding in the Chicago grain market...
...I know that is a strong statement but in view of continued harassment, new decrees and restrictions, I cannot help but draw that conclusion...
...E 0 4) >Z ZT...
...1,470 1,631 West Germany...
...U.S...
...Cargill did not put up any of the money: $13.5 million came from revenue bonds backed by the Port Authority, while the remainder flowed from special federal and state programs...
...In the last part, we look at the five companies that dominate the grain trade...
...Once again, timely backing from the U.S...
...As a result, Colombia now imports over 85% of its wheat requirement...
...Cargill was in the forefront of the push by business to develop new markets for farm production...
...economic aid to Chile, PL 480 has been an off and on spigot in the last several years: "off" for the socialist government of Salvador Allende, and "on" for the military dictatorship the U.S...
...The groundwork for the large sale of the following year was carefully planned by the Administration...
...The current world food crisis is not a crisis of production or overpopulation, but rather a crisis of distribution...
...Known collectively as the grain trade, these companies hold a pivotal position in the world's food supply system...
...cit.31 THE GRAIN TRADE 1. Interview with official at General Accounting Office (G.A.O...
...Domestically, the company operates at the three main points of grain collection and distribution: the local elevators where the farmer sells his grain, the subterminals and terminals at the major transportation crossroads, and the large export elevators located in major U.S...
...Figures obtained by NACLA from the State Department...
...To protect itself, Cargill will strive to maintain the veil of secrecy and attempt to use friendly politicians and bureaucrats as a protective shield...
...In 1974, Chile was the ninth largest purchaser of U.S...
...THE ASSAULT ON THE COMMON MARKET A focal point for U.S...
...Food for Profit," NACLA Newsletter, May-June, 1971...
...grain companies export to Japan, the huge Japanese trading companies control much of the internal movement of grain, and two Japanese firms, Mitsui and Mitsubishi, are even active in the U.S...
...Cargill markets grain...
...Among other places, it has offices in Manila, Tokyo, Panama, Buenos Aires, Amsterdam, and London...
...Today it is involved in banking, real estate and shipping as well as commodities trading...
...When Palmby left the U.S.D.A...
...For example, in the Central America countries, local and foreign capitalists, instead of producing nutritional foods to feed Central Americans, are major exporters of bananas, coffee, and now beef...
...In this context, Secretary of State Henry Kissinger in 1973 directed the National Security Council (NSC) to undertake a comprehensive study of U.S...
...In 1974, a Cargill representative, S. D. Ward, Jr., in a letter to the Departmelst of Agriculture, summarized the problems the company and other multinationals faced in South Korea...
...But most importantly, the thinking of the Commission was behind all the major moves made by the Nixon Administration in the field of agriculture...
...8. The History of Cargill, op...
...By bribing inspection officials to raise the grade or alter the classification of grain, the companies in effect increase their earnings by millions of dollars...
...Nations which concentrate their efforts in areas where they are most capable enjoy a comparative advantage in world trade...
...Seung Man Park, Cargill's local partner and the president of Korea Cargill, "was a supplier to U.S...
...6f10 851 Italy...
...The Williams report recognized the costs of maintaining empire as a major factor in the U.S...
...6. Ibid., pp...
...The implications of this new policy for the U.S...
...Quoted by Goodfellow, ibid...
...Examples of other large private corporations are the Hearst Corporation, Hills Bros...
...Cargill, of course, rallied behind Nixon in 1968...
...The CIA study projects serious food shortages in coming years and growing world reliance on U.S...
...access to raw materials at stable prices, and prevent producers from taking independent action...
...Former employee of Cargill, op...
...Without the crutch of government support payments, U.S...
...government reserves would inevitably push up prices...
...It has not been our policy to use food as a political weapon despite the oil embargo and recent oil price and production decisions...
...Sales Soar, Nearly Triple Cargill Profits," Minneapolis Tribune, Dec...
...As revealed in Senate hearings on the Soviet grain transaction, in late 1971 Soviet and U.S...
...foreign policy interests...
...could give the U.S...
...Foreign Agricultural Trade Policy, March and April 1973 (Washington, D.C.: G.P.O., 1973), p. 160...
...With no alternative means of moving grain, farmers were sometimes forced to accept price discounts of 10 to 25 and, in some cases, as much as 50 cents on each bushel of grain sold to Cargill...
...6. For more on the PL 480 program see Israel Yost, "The Food for Peace Arsenal," NACLA Newsletter, May-June, 1971...
...POLICIES TAKE EFFECT By 1973, the U.S...
...economic aid to Chile was the second highest for Latin America), and completely cut off military aid...
...FOREIGN MARKETING ACTIVITIES "THE SUN NEVER SETS ON CARGILL'S CORN" (In-house Cargill slogan) Since its first trading offices were established in Europe in 1929, Cargill's international operations have penetrated into every corner of the globe...
...And in a very real sense it's our extra measure of power...
...But ideological considerations do not starid in the way of the company's business interests...
...When the new facilities are completed in 1977, they will be leased to Cargill for thirty years...
...cit., p. 99...
...workers to sustain their economic growth...
...wheat for cash was denied "because of a political decision at the White House...
...And expanding them...
...4 The growing domination of the farmer's economic life by the railroads, the grain traders and the banking interests led to the Populist revolt in the 1880's and 1890's...
...1965 Brazil Feed plant, poultry Part of Cargill Agricola, S.A...
...Even the Title II donation program should be seen, at best, as only a stop-gap measure which ignores the systemic causes of hunger...
...Mondale read public statements by Cargill into the Congressional Record as recently as 1972, and he has received campaign contributions from Cargill...
...In a very real sense it is our extra measure of power...
...Cargill did enter into a joint venture with Toyo Futo Company in 1966 THIS LITTLE PIGGY MADE A MARKET...
...7 World War II brought with it a new commercial framework for the operations of the grain companies...
...In fact, the long-run impact of U.S...
...8. Yost, op...
...government...
...This should include a recommendation on how the private transactions of the U.S...
...Cargill's first manufacturing investment abroad was in Peru...
...New York Times, February 19, 1975...
...Instead, we need to focus on the real structural causes of the crisis...
...agriculture - chronic overproduction and the resultant depressing effect on farm income - the State had become heavily involved in the farm economy...
...2 Although we can only speculate on the contents of the NSC study, a widely leaked report prepared at the time by the CIA's political section gives insight into the thinking of U.S...
...It is likely that in the future, as the conflict between the United States and the Third World heightens, policy-makers will look increasingly to U.S...
...His son, Tom Palmby, works for Cargill.4s At the Department of Agriculture, Clarence Palmby played an important role in the shift to policies that Cargill had been advocating for years...
...A.NEW AGRICULTURAL POLICY The man Nixon brought in to head the Agriculture Department and orchestrate the export drive was Earl Butz...
...I do not like what is going on and I am not alone...
...At the same time, the South Korean government became less responsive to the demands of multinational corporations...
...U.S...
...economy...
...Washington Post Parade, July 2, 1975...
...trade mission to the Soviet Union was fully briefed by the CIA, which keeps a close watch on crop developments in the Soviet Union, and the mission was able to observe conditions first hand...
...Minnesota state politics are dominated by the Democratic Party (or the Democratic Farmer Labor party, as it is called locally), and Cargill works closely with many of its party leaders...
...THE AID WEAPON The chief weapon in the U.S...
...New York Times, May 25, 1975...
...Although involved in Argentina since 1929, Cargill's Brazilian operations are of much more recent origin...
...Meanwhile the parent firm, which owns flour mills, chemical and textile plants, and an array of other industrial operations throughout Latin America, is also encountering problems...
...With massive sales to the Soviet Union in progress, 1975 is likely to be another record year...
...For the current fiscal year, the Administration again plans to rely heavily on food aid to support the Junta...
...Judy Carnoy and Louise Levison, "The Humanitarians" in Weissman, op...
...The implications of U.S...
...See also Minneapolis Tribune, February 10, 1970...
...in Japan...
...agricultural policies in the 1970's led to a boom for the grain trade...
...Not even Cargill, the "Cadillac of the grain trade," possesses anywhere near the amount of capital needed to finance these seasonal grain inventories...
...And You" (Washington, D.C.: Agribusiness Accountability Project, mimeo, 1973...
...Interview with officials at the Agriculture Department, including a former administrator of the Barter Program...
...The company operated mainly in the European market until the rise of Hitler forced the family to flee to the United States with its business...
...negotiators ran into obstacles in agriculture, "they went ahead in the industrial area alone and didn't pay much attention to agriculture...
...Figures are from "Agriculture: the Biggest Growth Industry," Business Week, April 28, 1973...
...As the vice-president of Continental Grain Company complained, when U.S...
...farm programs designed to protect farmer income and moving to a market-oriented agriculture - a change the grain companies had long supported...
...See A. V. Krebs, "Of the Grain Trade, By the Grain Trade and For the Grain Trade," in Catherine Lerza and Michael Jacobson, ed., Food For People Not For Profit (New York: Ballantine Books, 1975...
...Each company buys and sells contracts for shipping space, never intending to use all of the space, but rather to keep its options open and to maximize profits...
...Address all correspondence to Box 57, Cathedral Station, New York, NY 10025 or Box 226, Berkeley, CA 94701...
...strategists, the fall of U.S...
...To satisfy these capital needs, Cargill maintains credit lines with 30 to 40 banks, including eight of the ten largest U.S...
...Because of such links, one government investigator who is looking at the grain trade succinctly labeled the situation in the U.S.D.A...
...Cargill is Argentina's leading exporter of wheat, barley, maize and other grains...
...Three of the country's major feed mills are owned by U.S...
...6. Interview with John Schnittker...
...To this day, family farms and medium-sized commercial units supply most of the world's grain...
...China Trade...
...At the same time Cargill used its control over railroads and elevating facilities to exploit the farmers...
...The success of the oil producing nations in setting their own terms on price and access to oil has led to similar attempts by other commodity producers as well...
...The * The General Agreement on Tariffs and Trade, or GATT, is one of the multilateral institutions that grew out of post-war efforts to re-structure the international economic system...
...Interview with official at General Accounting Office...
...food policy...
...And finally, the imperatives of capitalist agriculture within the United States required higher prices...
...These files include private correspondence and data submitted by companies such as Cargill...
...if the cooling trend in the world's climate predicted by climatologists] continues for several decades there would almost certainly be an absolute shortage of food...
...By the turn of the century, Cargill's profits enabled the family to expand into new areas totally unrelated to the grain trade...
...in 1972, his ties with the grain trade were made official - he became a Vice President of Continental Grain Company...
...Most accounts of the sale have focused on the way the grain companies manipulated the sales to obtain maximum subsidy payments (with the cooperation of Department of Agriculture officials), and on how the Soviets managed to buy U.S...
...there's a free market, but freedom exists only for the few and not for the many...
...The promise of food aid which Kissinger made to Egypt in late 1974 was one reason he fought so hard against Congress' effort to limit political food aid to 30 percent of the total...
...diplomacy...
...30 The chief construction and engineering manager, Myung Cho Chang, worked for the U.S...
...refusal to grant emergency food aid, Cofigress passed an amendment requiring that 70 percent of U.S...
...cit., p. 95...
...Cargill had especially close ties to Richard Nixon...
...But when it comes to putting it into practice, we've still got a long way to go...
...2 2 Thus the outlines of mutual interest are clear: the Soviet government is relying on the United States for food and technology, and the U.S...
...The company also owns two merchant shipping firms, one based in London and the other in Paris...
...CARGILL AND THE STATE Although the company loudly proclaims the need for free trade and abhors government regulation, it would be virtually impossible for the world's largest grain trader to operate without the continued support of many State institutions and organizations...
...Ibid...
...The existence of large reserves cushioned the market against abrupt price rises, since there was never a threat of shortages even with a big upswing in demand...
...With most of the economies of the world in disarray, the United States became the world's principal food supplier...
...Not all of Cargill's capital needs are satisfied by lines of credit with commercial banks...
...And Kissinger himself lobbied to have South Vietnam placed on the U.N.'s M.S.A...
...And finally, counterpart funds were a device to channel direct military aid to U.S...
...farm surpluses and to pave the way for later commercial sales, the program's political potential was immediately recognized by its proponents...
...They run offices in every corner of the globe, and their system of gathering information is so extensive that even the CIA turns to them...
...Officials claimed that the limitation applies only to food, not to other commodities shipped abroad under PL 480, such as tobacco and cotton...
...influence in the recipient countries...
...The figures listed in the PL 480 Annual Reports under Title III do not accurately reflect the actual spending level, since the Barter Program had spending authority under the Commodity Credit Corporation Charter in addition to Title III...
...efforts to counter growing challenges from the Third World...
...dominance over the world's grain trade...
...According to the Agriculture Department, half the remaining 2.3 million farms should not even be considered farms, since they have sales of less than $5,000 and account for only 5 percent of all cash receipts in farming...
...68-72...
...Exploiting people's most fundamental needs and making enormous profits in the process, firms like Cargill vividly illustrate the basic injustices of capitalism...
...in the agricultural sector 2 7 -a victory for those who complained agriculture's interests were "sold down the river" in the previous negotiations...
...As one government officer investigating the grain trade observed, "In the U.S...
...Forbes...
...The immediate causes, such as the U.S...
...The Incredible Empire of Michel Fribourg," Business Week, March 11, 1972...
...The concessional credits offered to foreign governments to import U.S...
...This is in response to Third World demands at the Paris energy conference last spring to broaden discussions to deal with the whole range of raw material questions...
...Even though U.S...
...Under the "Cooley loan" program, local currencies were loaned to U.S...
...509 396 Egypt...
...4 To manipulate the market the companies have developed a sophisticated intelligence network...
...It may be the one thing that we have in greater abundance and in the ability to produce beyond anyone else...
...balance of trade...
...The post-war period proved to be an even greater boom for Cargill...
...By focusing on the largest of these corporations, Cargill, we examine how these firms maximize their profits at the expense of farmers and urban working people alike...
...exports expanded greatly during the post-war boom, U.S...
...While this means that local currencies are no longer directly manipulated by the U.S...
...Richard Bell, Assistant Secretary of Agriculture Although the Farm Bill of 1970 had moved U.S...
...See also, "Sales Soar, Nearly Triple Cargill Profits," Minneapolis Tribune, December 2, 1973...
...representative of the Bunge Corporation...
...When one recalls that Cargill controls much of the flow of grain on the railway system without owning a single locomotive, that it received millions of dollars in storage payments for holding CCC grain surpluses which it could buy and sell at a moment's notice, and that much of Cargill's international trade is financed by PL 480 and other government lending programs, then one has a some understanding of how Cargill runs its commercial system...
...With farm input purchases amounting to $75 billion annually,' 0 the large corporations that manufacture machines and chemicals (such as International Harvester and Dow Chemical), view food production as a source of capital accumulation that is expected to yield the same rate of profit as any other industry...
...export strategy...
...In 1945, Cargill noted that among its many creditors, "the most important of these to Cargill is the world's largest bank, the Chase [Manhattan] Bank...
...Just after the First World War, Herbert Hoover used the U.S...
...This situation had serious implications for the United States' position in the world, since without a strong dollar and a healthy economy, the State* could not perform the many functions necessary to protect U.S...
...2 Chairing the Commission was Albert L. Williams, head of IBM's Finance Committee, and working with him were other representatives of the corporate elite, the academic community, and two labor leaders...
...market development programs in penetrating foreign markets...
...OPIC, op...
...Interview with official in the Agriculture Department's Food for Peace office...
...economy is correspondingly eroded.* One other factor contributed to the U.S...
...By 1960 Cargill had become a major international distributor of Peruvian fishmeal - a high-protein meal used for animal feed - and in 1963 the company purchased a large fish meal plant in Peru, as well as a fishing fleet to supply it...
...Food donations under Title II have also been used as an effective instrument to create markets for the U.S...
...A leading proponent of detente with the Soviet Union, Fribourg has entertained Soviet officials on yacht cruises since 1961, and his company has sold more grain to the Soviet Union than any other company...
...At the World Food Conference in Rome in 1974, the U.S...
...8. For a radical analysis of the history of U.S...
...Not only did the opening of trade with the Soviet Union play an important role in the U.S...
...In the age of monopoly capitalism, these companies hold a unique position...
...Cargill official, op...
...He was a leading architect of the Williams Commission Report (which drew up the blueprint of U.S...
...838 328 Source: Foreign Agriculture, August 18, 1975, p. 1 1 United States is now demanding the removal of the Common Market's protective tariff system which effectively prevents U.S...
...3 4 Kissinger carried this theme further when, at the Rome Food Conference, he tried to blame oil-induced inflation for "shattering the ability of developing countries to purchase food, fertilizer and other goods...
...Another little known provision of PL 480, the Title III barter program, was used to channel support to the Vietnam war effort...
...At the same time, the Soviets were negotiating privately with the major U.S...
...strategic interests has shifted elsewhere - to South Korea and the Middle East...
...312 759 Iran...
...As one company representative noted, "the grain companies can adjust much quicker than a farming community" to changing market conditions...
...6 Cargill's use of cut-throat business practices and its rapid pace of expansion upset many of the established grain trading interests...
...The concept of nations working together for the mutual benefit of all isn't new either...
...3. The History of Cargill, Incorporated...
...The Williams report did not gather dust on government shelves...
...Even before the Soviet sales, the impact of devaluation was apparent: in the two quarters following devaluation, the quantity of U.S...
...commercial banks.' 8 Cargill draws on these credit lines to pay for its grain purchases...
...cit., p. 76...
...Food will give us influence because decisions in other nations will depend on what we do...
...grain, even if it means a disastrously inefficient use of the world's protein supply...
...But by the end of the year, the Administration had taken advantage of the new availability of grain originally allocated to Indochina and the overall increase in the PL 480 budget to raise Chile's share of food aid to $65.2 million ($61 million in Title I and $4.2 million in Title II).24 The U.S...
...3 6 The growth of nationalism and popular movements in Latin America forces Cargill to rely heavily on its Brazilian base...
...See Kissinger's speech of September 2, 1975, and interview with Kissinger in Business Week, January 13, 1975...
...9 As one government official observed, "The food aid program today exists as an arm of Kissinger's foreign policy...
...7. Cooley loans are listed in an Agency for International Development document prepared by the Office of Financial Management, Status of Loan Agreements As of December31, 1974 (#W-224...
...In spite of the commitment of government and corporate leaders to "free enterprise," State intervention was essential to meet the constant threat of overproduction and farmer discontent...
...Today the U.S...
...cit., p. 7. 5. Ibid., p. 152...
...Cargill received 95 percent of its financing from the U.S...
...imperial interests, it is apparent that Third World countries cannot look to the United States government for a solution to the on-going crisis of hunger...
...oil needs...
...Then in 1964 Cargill acquired the Hens companies, a major feed manufacturing * Nutrena is one of the three largest U.S...
...Second, through these commodity arrangements Kissinger hopes to establish ground rules that assure U.S...
...has the capability to produce grain and other foodstuffs in abundant quantities...
...Immediately after the war in Europe, U.S...
...3 The Cargills also extended their commercial influence by forming partnerships with a number of other grain merchants to erect or control elevators...
...Today, the company has offices and plants in 34 different countries...
...As the report stated, "many of the economic problems we face today grow out of the overseas responsibilities the United States has assumed as the major power of the non-Communist world...
...A U.S...
...As a newcomer, Cargill's market initiatives met with resistance...
...There's no way of knowing how much this amount may be increased in the course of the year...
...officials, the sale was a crucial element in U.S...
...food arsenal is the food aid program...
...Cargill in effect is now a mini-conglomerate involved in an array of operations that have no direct relations to the grain trade or to food processing...
...Based in France, the Dreyfus family has been active in the grain trade since 1842...
...In 1973 the company possessed net assets worth only $352 million, but with this relatively small capital base it conducted a volume of trade worth $5.3 billion...
...interests overseas...
...imperialism is exemplified in its South Korean operations...
...in Steve Weissman, ed., The Trojan Horse (San Francisco: Ramparts Press, 1974...
...In 1972, they used this position to their utmost advantage...
...Louis Dreyfus Corporation Of the five major grain companies, least is known about Dreyfus...
...formulas...
...In fact, events surrounding the recent large Soviet purchases suggest that U.S.-Soviet relations have reached a new level of accommodation...
...Comparative advantage" was simply another way of describing an international division of labor structured in U.S...
...And why Cargill is now building up poultry in Pakistan and Taiwan...
...This has helped make that country the fifth largest market in the world for U.S...
...5. G.A.O., op...
...General Assembly, issued an unmistakable warning to Third World commodity producers that the United States would withhold food to retaliate against cartels: The attempt by any nation to use one commodity for political purposes will inevitably tempt other countries to use their commodities for their own purposes...
...2 4 The report predicts that the prospects for U.S...
...The companies oppose all forms of export controls and some of them are lobbying against international grain reserves...
...General Accounting Office, Alleged Discriminations and Concessions in the Allocation of Railcars to Grain Shippers, 1974, pp...
...The companies manipulate every possible market mechanism - the more the better...
...As one person close to Cargill observed, "If a person has the power, Cargill finds the way to influence the person...
...Both the small country elevator owners and the farmer cooperatives complained bitterly that the companies were able to take advantage of subsequent price rises at their expense.Is And, of course, the CCC also lost a sizable amount of potential revenue since it could have waited for corn prices to rise before selling the surpluses...
...Thus, it was no surprise that every major move made by the Administration in agriculture coincided with the interests of the grain companies...
...The other loan, for more than $1 million, came from the Private Trade Entity provisions of PL 480, which extends credits to foreign subsidiaries of U.S...
...By the 1880's, Cargill operated along major railway arteries in five states-North and South Dakota, Iowa, Minnesota, and Wisconsin...
...But they rely on us for soybeans, feed grains and wheat...
...wheat, and their per capital beef consumption has doubled in the past decade...
...is the largest privately owned U.S...
...Feed Grains Council, a trade organization dominated by the major grain companies, which is devoted to expanding U.S...
...It invoked the principle of "comparative advantage" to justify increasing the U.S...
...Five companies - Cargill, Continental Grain, Cook Industries, Bunge, and Dreyfus - dominate the world's grain trade and control about 85 percent of U.S...
...vessels, whose rates were far above world prices...
...Control of these currencies gave the United States an important mechanism to further U.S...
...One month later, the Department of Agriculture explained that "a major consideration [in the NEPI is the need for American agriculture to remain a growth factor and to continue expanding its markets abroad...
...concessional programs, while others have "graduated" from PL 480 and now use their meager foreign exchange to satisfy the new demand for U.S...
...Bids are made in fractions of a penny per bushel as a company strives to beat out a competitor for a potential sale...
...imported more than it exported, registering the first trade deficit of the century...
...But the Junta received a double benefit...
...government agencies," it diversified its operations and prof- ited from the war...
...Like other large corporations under monopoly capitalism, Cargill seeks to limit the commercial options available to the small producer...
...Pre-1971 Thailand Feed mill Insured by OPIC Guarantee for $600,000...
...The reasoning was that the more poor nations felt the fuel and price squeeze, the more likely they would be to turn on OPEC...
...foreign policy makers is revealed by the fact that Chile ranked 6th worldwide on the list of recipients of PL 480 credits in fiscal year 1975...
...policy makers was well summarized by a member of the National Security Council who commented, "To give food aid to countries just because people are starving is a pretty weak reason...
...5 The Great Depression did little to deter the company's expansion...
...Not only is Cargill involved in exporting U.S...
...THE INTERNATIONAL FRONT The Administration's first major move on the international front to implement its export drive was the devaluation of the dollar in August 1971...
...only in its manipulation of the market, but also to use the State for its own interests...
...I U z Drawing by lmcIcK Logan xx 20 THE BIG FIVE Cargill, Inc...
...Third World nations do import food, but the same market mechanisms operate within these countries: the affluent minority eats increasingly well while the masses go hungry...
...agricultural exports reached an all-time high of $21 billion...
...Subscriptions: $10 per year for individuals ($18 for two years), $16 per year for non-profit institutions ($30 for two years), $25 per year for profit-making and government organizations ($48 for two years...
...EXPANSION AT HOME AND ABROAD By the early 1920's, Cargill had fully recovered from its brush with bankruptcy and embarked on a new expansive phase...
...Counterpart funds have also aided the expansion of U.S...
...Nominally set up to control speculation and profiteering in the grain trade, the Board in reality is dominated by the grain trading interests which it is supposedly regulating...
...As of May 31, 1975, Cargill's world-wide annual sales stood at about $9 billion, making it the largest grain trader in the world.** In spite of Cargill's sprawling business empire, its name is not a household word...
...Thus, higher food prices and the resultant decline in the standard of living for North Americans are acceptable to the multinationals, especially when these changes are part of a strategy to prop up the U.S...
...helped install...
...3. Interview with Washington, D.C...
...balance of trade $8 billion by 1980...
...interests in the Third World...
...Los Angeles Times, September 11, 1974...
...As Administration officials admit, one effect of these sales will be rising food prices...
...For more on U.S...
...The most politically active of the grain companies, Cargill in the early 1960's set up a Public Policy Committee within the company which formulates positions on key issues and works out guidelines for the company representatives who speak out publically...
...The railway owners and 'the grain elevator operators, such as Cargill, sometimes conspired to fix grain prices...
...Based in New York, Continental Grain, more than any other grain company, projects a "cool, corporate, Wall Street image...
...power and influence especially vis-a-vis the food deficit poor countries...
...In one recent year, Cargill borrowed more short term cash than any other corporate entity in the United States...
...The ideal circumstance for the grain traders is a widely swinging market that allows them to take advantage of the ups and downs in supply and demand, and thus maximize their profits...
...Frundt, op...
...As a result, the Japanese are now major consumers of U.S...
...The Argentine subsidiary is now run by executives stationed in Brazil...
...Although the First National Bank provides Cargill with only a small part of its capital needs, it heads up the First Bank System which controls 88 banks in five Midwestern states...
...government, in an effort to overcome the deepening trade crisis, launched a drive to expand agricultural exports, and in the process touched off an unprecedented increase in world food prices...
...PL 480 also serves as a handy tool to undercut competitors in foreign markets and to coerce aid recipients into increasing commercial purchases from the United States...
...San Francisco Examiner, October 5, 1975...
...policy makers are walking a thin line...
...export strategy had its intended impact: agricultural exports were at record highs,* U.S...
...files on Private Trade Entity loans...
...44 Sometimes personnel go from the grain companies to work for the Department of Agriculture, while in other instances people who leave the U.S.D.A...
...Ever since the conclusion of the previous GATT negotiations in the mid-1960s, the grain traders had protested bitterly that their interests had been ignored...
...supplies...
...As many grain company executives are fond of pointing out, the trade is highly competitive...
...When Palmby left that job in 1972 he became vice-president of Continental Grain, one of the largest grain traders, and he was replaced by Carroll Brunthaver, who came to the Department from Cook Industries, another major exporter...
...CONCLUSION: PROFITEERING & THE FUTURE OF THE GRAIN TRADE The shift in U.S...
...The Nixon Administration was finally able to make a decisive move to free market agricultural policies...
...agricultural products...
...4 3 As Nixon's first formal press conference since the California debacle, it proved to be a success and encouraged many people to take a second look at him...
...The History of Cargill, op...
...s This scheme coincided with the interest of U.S...
...had subsidy programs, it could not effectively demand that its trading partners remove theirs...
...349-51...
...Harold Cooley, once powerful head of the House Agriculture Committee...
...SOVIET WHEAT DEAL The major boom in U.S...
...Grain farmers are in a somewhat unique position in U.S...
...attempts to apply the principle of comparative advantage are well illustrated by the case of Colombia...
...policy-makers is the new drive by Third World commodity producers to assert control over their natural resources...
...For Cargill, as well as for the grain industry as a whole, Chase is the "lead Bank...
...2 6 Japan is one of the world's leading grain importers...
...Not only was there growing resistance to funding the Indochina war, but also to supporting repressive dictatorships around the worldthe "friendly" countries who figured highest on the foreign aid priority list, from the Junta's Chile to Park's South Korea...
...Aside from obtaining loans from many of the smaller midwestern banks, Will Cargill befriended a prominent Milwaukee banker, Robert Elliott, who "backed his friend not once, but again and again to their mutual benefit...
...Its blueprint for agricultural policy is repeated in reports and documents of the Agriculture Department...
...capitalists to maintain U.S...
...Though Cargill complained about the "frequent and serious incursions by various * The Creditors Committee was composed of representatives of the First National Bank of Minneapolis, the Boston commercial firm of Bond & Goodwin, and a lumber magnate, F. P. Dixon...
...Secretary of Agriculture, Earl Butz, announced that "Food is a tool...
...The United States refused and the meeting broke up...
...economic crisis were clear...
...grain sales should be related to Government actions including the U.S...
...the value of the dollar had plummeted as Washington refused to redeem foreign-held dollars for gold...
...The power of the tr...
...grain trade view the companies as 19th century robber barons and propose government regulation to force them to respond to public needs...
...Sources: Foreign Agriculture, 5/26/75...
...Its international trading operations are directed by Tradax, a subsidiary with headquarters in Geneva...
...Government involvement in domestic and export programs was also an obstacle to the free trade strategy aimed at penetrating foreign markets...
...This year, PL 480 loans to Egypt for wheat and to South Korea for rice were tied to additional commercial purchases of those commodities...
...Thus, the "success" of U.S...
...79-85...
...At about the same time, Cargill began constructing a soybean processing plant in Spain...
...He went on to add "I understand many of the grain companies do it...
...Founded in 1865, Cargill is the only major grain company with roots in 19th century America...
...But the Cargill fortune was saved by the infusion of new blood into the company administration...
...trade strategy...
...Michael Fribourg assumed control of the company in 1944 at the age of 30, and quickly turned the firm into one of the world's largest grain merchandisers...
...661 885 Mexico...
...in the industrial sector in exchange for concessions to the U.S...
...3 2 Unable to profit from its Korean operations, Cargill again fell back on the resources of the U.S...
...A secret document prepared by the Department of Agriculture reportedly admitted to the objective of raising world prices.' Prices within the United States would also inevitably rise as food was diverted to export markets and domestic supplies strained...
...Worried about the growing power of the teamsters and the trucking industry, Cargill, in the 1960's, took the lead in pressuring the Interstate Commerce Commission (ICC) to restructure railway rates and regulations so that rail transportation became more economical for the grain companies.16 First, the regulations were altered so that the companies could take control of entire train units at special rates...
...The last round of negotiations, known as the Kennedy Round, took place between 1963 and 1967.9 MARKET DEVELOPMENT Bread & Butter Imperialism The recent boom in U.S...
...In 1969, Cook took control of a large plywood firm, thus giving the company an industrial base...
...Located in a French-style chateau outside of Minneapolis, the company's officials deal in billions of dollars worth of commodities in pastoral surroundings seemingly far removed from the modern corporate world...
...Partly because of the CAP, U.S...
...Throughout much of the world, living standards have been improved through specialization of labor and resources...
...For fiscal year 1975, the Administration was again budgeting half of PL 480 credits for South Vietnam and Cambodia...
...A contemporary factor which has contributed greatly to the food crisis is the growing integration of the world's capitalist economies...
...The word "grain" is broadly defined to include wheat, corn, soybeans, oats, and barley as well as other lesser known agricultural seeds...
...The prices on these pre-harvest sales, or futures contracts, are determined by what the buyer and seller predict will be the value of the grain when it is delivered...
...It serves as a stick to wield against nations engaged in revolutionary processes (as in Allende's Chile...
...In the 1830's William D. Cargill, a Scottish Presbyterian, migrated to the northeastern United States, where he worked as a captain in the merchant marine...
...3 9 In fact, the reserve proposal contains no concessions to the Third World, and is primarily a model for serving the United States' own self interest: it is intended to provide an outlet for U.S...
...Foreign policy strategists were, of course, anxious to avoid this kind of interference, and sought to channel funds through safer mechanisms not so vulnerable to the Congressional scalpel...
...183 757 United Kingdom...
...In many instances the companies discounted 10 to 25 cents per bushel from the market price they paid the farm coops and the locally controlled elevators for their grain.17 The lack of shipping alternatives meant that the local merchants and farmers had no choice but to sell at the price the grain company dictated.24 FINANCING CARGILL'S EMPIRE Banks and financial institutions play an especially important role in Cargill's sprawling commercial empire...
...corporations, Cargill does not sell its shares to the public...
...intervention in Vietnam placed new limits on their ability to protect U.S...
...Sen...
...for internationally oriented policies...
...Retired Cargill official, op...
...Senate Committee on Agriculture and Forestry, Hearings on U.S...
...They use their enormous size to manipulate the marketplace and to maximize profits at the expense of farmer and consumer alike...
...And then he added: It would be tempting for the United States, beset by inflation and soaring energy rices, to turn a deaf ear to external appeals for food assistance.t The failure of these attempts to undercut Third World militancy have led to a subtle shift away from aggressive confrontation...
...Once they had opened up the market in a given country with PL 480 concessional sales, it was much easier for them to follow up with direct commercial sales...
...famine-stricken Bangladesh received a mere $41 million...
...Ibid...
...The two companies move approximately the same volume of grain each year, but Continental is less diversified with only about 15 percent of its annual sales coming from non-merchandising activities...
...The grain trade forms an integral part capitalism...
...Cargill Incorporated, Cargill Building, Minneapolis, Minnesota 55402 From Cargill ad in Southwestern Miller26 the Latin American countries most susceptible to bribery in arranging grain deals...
...Although competitive, the grain companies, like many other enterprises under monopoly capitalism, are not at the mercy of the free market...
...feed grains...
...3 8 Both of Minnesota's Senators, Hubert Humphrey and Walter Mondale, have ties with Cargill...
...Cargill is also active in the Japanese poultry and meat industries...
...Today, Cargill uses Shaver to form an integrated package of feed mills and poultry breeding stock when it moves to establish operations in other countries...
...About two-thirds of this income derives from the grain trade...
...This large increase occurred just as Congress moved to reduce the Ford Administration's military aid request for South Korea, and proposed to phase out military aid to that country over a three year period...
...The company headquarters reinforce the air of secrecy...
...When this year's PL 480 spending estimates were presented to Congress last spring, the Administration deliberately made no requests for the Middle East, pending a "review" of Middle East policy...
...The U.S...
...Senate, Committee on Agriculture and Forestry, Subcommittee on Foreign Agricultural Policy, Hearings, U.S...
...Thus, the ultimate solution to the crisis can only come about through a radical change in the economic system...
...Samuel Sabin, quoted in Richard S. Frank, "Trade Report," National Journal Reports, October 20, 1973...
...agriculture in the 1970's), he served as deputy special trade representative with the rank of ambassador, and he headed up an interagency team that guided the 1973 Trade Reform Act through Congress...
...Oilseeds-soybeans, flax, sunflower, safflower, copra, rapeseed, ground nuts, etc...
...While economic aid requests for Chile come to only $23 million (the third highest in Latin America), the Administration has allocated $55 million under Title I for the Junta - 84 percent of the Latin American total...
...As an AID official put it, "U.S...
...The grain itself is often transferred on paper from country to country...
...When new agricultural crops or techniques were introduced, they were used to grow commercial crops for export rather than to increase the food supply of the indigenous peoples...
...See also Walter Cohen, "Herbert Hoover Feeds the World" in Weissman...
...One source noted that "Cargill was closer to Richard Nixon than it has been to any President...
...agricultural commodities...
...Hubert Humphrey, who observed at the time: I have heard . .. that people may become dependent on us for food...
...The effect of these support programs, (as in the U.S...
...Cargill is a member of the U.S.-U.S.S.R...
...agriculture...
...exports to penetrate the major commercial markets of Japan and Europe...
...Del Monte Corporation, for example, which is the world's largest processor of fruits and vegetables, grows asparagus in Mexico for export to the United States, and pineapples in Kenya for export to Europe...
...The food situation also has a disastrous impact on the balance of payments position of Third World nations...
...officials to intervene on its behalf with the Korean government to try to obtain a relaxation of the import restrictions and the domestic price controls...
...For Cargill, like many multinational corporations, the heavy hand of a military regime helps insure continued profits...
...embassy costs to Department of Defense expenditures), thereby offsetting the outflow of dollars...
...4 2 The ties go back at least as far as Nixon's vice-presidential days when he was entertained several times by the company in Minnesota...
...Interview with John Schnittker...
...This is why Cargill has helped foster new meat and poultry industries in Japan (now our nation's to construct new grain handling facilities in Japan...
...The Trade Reform Act of 1974, pushed through Congress under the guidance of William Pearce, effectively directs U.S...
...As the Commission's figures revealed, by 1970 the United States' post-war trade surplus in manufactured items had turned into a deficit of $5.5 billion...
...Although originally conceived as a mechanism to dispose of U.S...
...government accepted the local currency generated by the food sales (known as "counterpart funds") as repayment for Title I credits...
...grain, it also buys and exports grain in the other major agricultural producing nations...
...Quote attributed to ex-president of General Mills by retired official of Minnesota Democratic Party...
...The Williams Commission also recognized that "an integrated world economy [where] the multinational'firm makes its decisions in global terms" is the main characteristic of the contemporary capitalist system...
...The expansion of agricultural exports is the cornerstone of Washington's efforts to overcome the U.S...
...The current president of the First National Bank, George H. Dixon, also serves as a director of the Cargill Foundation...
...are hired by the grain trade...
...Able to handle large * For a more extended discussion of CCC credits and the Barter Program, see Part I above...
...21 No major financial moves are made by Cargill without first consulting with Chase...
...To me that was good news, because before people can do anything they have got to eat...
...In a cooler and therefore hungrier world, the U.S...
...The stuff they get is probably shit...
...markets overseas being lost...
...2 0 Although the magnitude of the sale may have exceeded the early expectations of U.S...
...interests...
...capitalism for the past century and a half...
...Although less is known about the operations of many of Cargill's other subsidiaries, the corporation is heavily involved in two South American countries - Brazil and Argentina...
...The rise of agricultural exports after the depression of the 1890's along with the continued growth of the national economy, eventually provided the farmers with new markets, thereby alleviating their financial plight and defusing the Populist movement...
...When he left Purdue University to join the Nixon Administration in 1971, Butz had to relinquish seats on the boards of three agribusiness corporations: Ralston Purina, Stokeley Van Camp, and International Minerals and Chemicals...
...In fact, while Continental Grain, Dreyfus, and Cook Industries tied up most of their elevator and shipping capacity in moving grain to the Soviet Union, Cargill later picked up the more lucrative grain sales to other overseas customers - after the world price of grain had soared to unprecedented levels...
...As one company official noted, "Tradax and Cargill are mirror images...
...1967, p. 5. 25...
...It is not the farmer who benefits from higher prices...
...Many employees of the feed plant are veterans of the Korean War, and almost all of them have had military training...
...As mentioned earlier, a key element in negotiating the 1972 Soviet grain deal and solidifying Detente was the $750 million credit extended to the Soviet Union...
...Since World War II, the development of new transportation techniques has enabled the company to stay one jump ahead of its competitors and to extract the maximum profit from every bushel of grain it handles...
...3 Kissinger's attempts to extract maximum political advantage from the U.S...
...He sold his shipping interests just before the bottom dropped * Unlike most large U.S...
...As one U.S...
...2 His sons soon adapted their father's trading talents to the agrarian economy of the Midwest...
...2, 1973...
...Controlling some 10 percent of the U.S...
...interviews conducted by NACLA's Agribusiness Project...
...4. Work, op...
...4 14 The role of the food weapon in U.S...
...The reason for this policy of maximizing exports regardless of domestic costs goes beyond the Administration's commitment to "free trade" and maintaining the profits of the grain companies...
...1 As the food crisis highlighted the world's dependence on U.S...
...Price supports also kept U.S...
...trade crisis - to pay for imported oil and manufactured goods, and to maintain the value of the dollar...
...In all of these instances legislation was passed, or policies were established, that reflected the general interests of the grain trade...
...Continental Grain Today is Interdependence Day...
...Immediately after the OPEC embargo, the Administration focused its attention on the problem of oil prices...
...The food program became know euphemistically as "Food for Peace," and a White House Food for Peace office was established...
...Cargill's closest link is with the First National Bank of Minneapolis, which served on the Creditors Committee in 1909 when Cargill entered into receivership...
...Current policies mean a continuation of the trend toward concentration, integration and corporate takeovers in farming-precisely the scenario envisioned by the Williams Commission and advocated by Earl Butz.* Only the biggest farmers, with large capital resources, will be able to survive in the "free market...
...Profits were $107.8 million, or over 43 percent return on assets.-s No other large corporation in recent history has reported such astounding profit margins.* * The figure of 43 percent return on net assets should not be confused with annual percentage increase in profits...
...The company also expanded into related areas of international agribusiness...
...Foreign Agricultural Trade Policy, 1973.10 MAJOR MARKETS FOR U.S...
...For example, in South Korea (the second largest recipient of PL 480 credits), 85 percent of food aid proceeds were used for this purpose...
...power...
...In 1932, Cargill assumed control of the new grain export elevator at Albany, New York, at the time the largest facility of its kind in the world...
...2 6 These credits came under the CCC's Export Credit Sales program, another of the CCC's programs with virtually unlimited spending authority, passed out at the discretion of Administration officials...
...85-87...
...share of the world market during the 1960s...
...wheat crop...
...government operations abroad (ranging from U.S...
...Under Kissinger's direction, U.S...
...The Agriculture Department's study, known as the Flanigan Report, fully endorses the Williams Commission thinking on comparative advantage and free trade...
...Butz's announced goal of "getting the government out of agriculture" meant the reversal of policies that had prevailed since the 1930's...
...Using loan repayments on PL 480, the Department of Agriculture last year gave private agricultural associations $12 million to support their promotional efforts...
...Unpublished study by William Goodfellow, former member of the Indochina Resource Center, Washington, D.C...
...Few people were fully aware of the political dimensions of food aid, and it was in any case difficult to oppose a program ostensibly aimed at getting food to needy people...
...3 4 As the Ford Administration's current attempts to hold down inflation by suspending sales to the Soviet Union reveal, U.S...
...Interview with an aide to a Senate Subcommittee investigating the grain trade...
...New York Times, November 3, 1974...
...food arsenal was called into service to rescue the Junta...
...agricultural exports were $5 billion...
...2 As one representative of the grain trade said in an interview, "the NEP was very important in giving U.S...
...agricultural surpluses, to help keep farm prices high, to bolster the U.S...
...4 7 William Pearce of Cargill worked on expanding trade with the Soviet Union from his post in the White House as Deputy Special Trade representative...
...With the program now defunct, the Agriculture Department claims that records about how the money was used are unavailable, but officials admitted that AID used the program extensively to procure supplies for its operations in Vietnam.is The budget for the barter program increased dramatically in the early 1970s, just as U.S...
...Cargill's Chateau Headquarters near Minneapolis23 For Cargill, PL 480 served as a two pronged instrument in its market expansion...
...Union for Radical Political Economics, "Is Food Inflation Painless...
...While farm debt has increased 355 percent in the last two decades, as capital continues to invade the farm sector, the farmer has received a declining share of the food dollar...
...Clarence Palmby, the assistant secretary for International Affairs in charge of export programs, had formerly worked for the U.S...
...Its subsidiaries in these two countries are in effect "miniCargills...
...PL 480 credits for the Middle East will be announced shortly, but according to one Agriculture Department official, Kissinger has already made large commitments.33 FOOD BLACKMAIL AGAINST THE THIRD WORLD Food has also become an important political weapon in U.S...
...Cargill officials also serve in government positions...
...Organizations like the Western Wheat Growers Associates have taught people throughout Asia to bake and eat bread, thus increasing demand for U.S...
...Cargill failed on two earlier occasions to gain a foothold in Brazil - one in 1947, and then again in the 1950's...
...For the Allende government, food imports assumed major importance as right-wing landowners moved to sabotage food production, and the Chilean working class gained purchasing power...
...One small grain company executive who was recently caught bribing a Salvadorean official proclaimed that such payoffs are "not at all unusual...
...Ibid...
...Cook handles between 10 and 18 percent of U.S...
...As one former grain company official who now works in the export division of the Agriculture Department noted, with PL 480 "we taught people to eat wheat who didn't eat it before, particularly in the Far East...
...According to one informed source, the company or its officers "have given money to Humphrey for every campaign since he ran for mayor of Minneapolis...
...might regain the primacy in world affairs it held in the immediate post World War II period...
...Although they import less grain than Western Europe and Japan, the Third World countries are lucrative markets for the grain traders...
...According to a Continental Grain officer, the president of the company, Michale Fribourg, "has felt since the late 1950's that it is better to trade with the Communist countries than to fight them...
...In protest against the Junta's repressive policies, Congress placed a $26 million ceiling on economic aid to Chile for fiscal year 1975 (even with this ceiling U.S...
...However, Cargill, like the other ascendant business interests, emerged largely unscathed from the revolt...
...government involvement in the Soviet grain sales is based primarily on information revealed in the hearings held by the Permanent Subcommittee on Investigations of the Senate Committee on Government Operations, on Russian Grain Transactions, July 1973 (Washington, D.C.: G.P.O., 1973...
...grain company representatives say Americans can no longer take cheap food for granted...
...In the past 20 years, South Korea has received more PL 480 commodities than any country except India...
...agricultural exports and to take the American way of eating to millions of people around the world...
...In fact, throughout the '60s, the maritime unions were attacked by the grain companies as the chief obstacle to trading with the Soviets...
...To be effective, a campaign against the grain trade must form part of the movement that challenges the very existence of capitalism...
...Democratic Party official, op...
...In 1972, Peter Flanigan, head of Nixon's Council on International Economic Policy, requested that the Agricultural Department develop a strategy for the upcoming negotiations...
...Interview with an aide to a Senator on Committee on Agriculture and Forestry...
...To deal with the two basic problems of U.S...
...grain imports...
...Based in Minneapolis, the company projects an "American as apple pie" image...
...Hubert Humphrey put it even more bluntly when he said, "Food is power...
...For one thing, Butz's announced goal of getting rid of U.S...
...Martha M. Hamilton, The Great American Grain Robbery & Other Stories, Agribusiness Accountability Project, 1972...
...Interview with official in the Export Operations Division of the Agriculture Department...
...wheat industry, AID introduced a wheat-soya blend to the Indian market...
...The New Economic Policy and Agricultural Trade," Foreign Agriculture, September 27, 1971...
...As the chairman of one of the major grain corporations put it: The opening of trade with China and Russia is the greatest thing of the century...
...The Cooley loan program derived its name from the late Rep...
...Since Cargill, however, deals primarily in the buying and selling of commodities, it is more accurate to compare it to the leading merchandising firms where it would rank 5th, just behind J. C. Penney, but ahead of Montgomery Ward...
...But just as it appeared that Cargill and the other grain companies would have to reconcile themselves to a smaller role in the world export markets, the U.S...
...A look at these strategies and their implementation reveals that rising food prices and the accompanying crisis for millions of people throughout the world were largely the result of the efforts of U.S...
...Wall Street Journal, January 16, 1973...
...go) formulate foreign policies...
...In the Commission's report to the President the following year, agricultural exports were assigned a pivotal role in overcoming the U.S...
...Foremost among them is William Pearce, a vice president of the company...
...First it asked U.S...
...CARGILL 1. Cargill Today, no publication date, issued by Cargill between 1965 and 1968...
...According to one Agriculture Department official, "word came down" from the State Department to extend the Chile credits, in spite of the fact that the program had been suspended for several months because of the tight food supply situation...
...Their control of the means of production enabled them to bypass the merchant houses and set up their own marketing networks...
...First, in the late 1940's, Cargill opened a new access route to the Mississippi River by widening the Minnesota River channel, thereby enabling the company to bypass Minneapolis where labor costs and municipal regulations made grain handling more expensive...
...food relief program to support anti-communist forces in Eastern Europe, and as a lever to extract political concessions from the Bolsheviks in Russia...
...In recent years, the subterminals have assumed a special role in the company's expansion...
...efforts to expand food exports is the multilateral trade negotiations being carried out under the auspices of the GATT.* Preparations for the current negotiations (expected to last several years) began in the early 1970s...
...Cargill of course possessed neither of these ties...
...efforts, people who once relied on their indigenous foods now eat U.S.-grown wheat transformed into American-style steaks, hamburgers and Kentucky fried chicken, all raised on U.S...
...agricultural strategies are equally serious for other working people in the United States...
...food credits that year...
...It erected large 2122 grain terminals on the Great Lake ports, and even built short railway lines to link major commercial and transportation routes in the Midwest...
...2. John L. Work, Cargill Beginnings...
...The adverse impact on Third World countries' ability to purchase food was of secondary concern, however, to U.S...
...Since most of the companies' international transactions are in foreign currencies, they also maintain divisions that deal solely in foreign exchanges...
...Cargill's influence pervades both of the major political parties...
...Many critics of the U.S...
...grain industry lobbied to prevent the Indian government from starting an indigenous processing industry...
...As one former Under Secretary of Agriculture noted, "The grain companies are always at the elbow of people in the U.S.D.A...
...According to one knowledgeable Washington source, Cargill was a force behind the nomination of Clarence Palmby to the post of Assistant Secretary for International Affairs and Commodity Programs, the key post for the grain trade in the U.S.D.A...
...During the outward expansion of Western Europe and the subsequent expansion of the United States, once self-sufficient economies were destroyed as the more developed countries extracted agricultural and mineral wealth...
...balance of payments, and finally, to help meet U.S...
...Bunge Corporation The Bunge Corporation, based in the United States, forms part of the worldwide financial empire of Bunge & Born...
...Japan is the prime example of the success of this government-industry partnership in penetrating foreign markets and transforming people's eating habits...
...From the moment the grain is purchased until the time it is finally sold abroad, Cargill and other exporting companies must have sufficient funds to cover the costs of carrying these large quantities of grain...
...6 Foreign governments use these credits to import food from the United States, and then sell the food13 "To give food aid to countries just because people are starving is a pretty weak reason...
...out of the maritime industry in the Panic of 1857 and moved to Wisconsin to become a gentleman farmer...
...The Japanese market was carefully nurtured during the 1950's through PL 480 shipments, and most recently through the promotional activities of the trade associations...
...And if you are looking for a way to get people to lean on you and to be dependent on you, in terms of their cooperation with you, it seems to me that food dependence would be terrific.s By the early 1960s, PL 480 had been fully incorporated into the arsenal of U.S...
...181-199...
...The main target of the Flanigan strategy (which has become the basis of the U.S...
...As the Williams report pointed out, free trade would allow U.S...
...and William Robbins, The American Food Scandal (New York: William Morrow, 1974), p. 180...
...food under PL 480 became an effective instrument for dumping U.S...
...While the commercial houses focused their international activities on the buying and selling of commodities, the multinationals gained direct control of mining and manufacturing facilities...
...The White House was, according to one of the participants, "deeply involved," through both Henry Kissinger and the staff of the Council on International Economic Policy...
...The CCC has also turned off the credit spigot...
...Sections of the Department of Agriculture are virtually run THESE ARE SOME OF CARGILL'S ACTIVITIES WORLD MARKETING Food grains and feed grainswheat, corn, oats, barley, sorghum, rye, rice, alfalfa, etc...
...This provision, however, had little effect in Indochina or other countries...
...In 1865, the oldest son, Will, went to Iowa where he bought an interest in country grain elevators along the new railway lines...
...grain, policy-makers launched a new initiative to incorporate "food power" into U.S...
...6 Be it detente with the Soviet Un negotiations with the European Common companies work closely with the U.S...
...The $61 million credit eased its balance of payments difficulties and freed dollars for the import of other items, such as weapons...
...farm policy toward more of a market orientation, a decisive shift could not be made until the U.S...
...representative of the Bunge Corporation...
...Domestically they control local grain elevators, storage bins, railroad cars, shipping barges, and port elevators...
...Japan...
...Cargill's subsidiary (called Korea Cargill) also provided lucrative opportunities for Koreans who had served the U.S...
...Another was to rely more heavily on food aid to support U.S...
...political commitments, not only in Indochina, but in other countries as well...
...The emergent corporate interests in the United States never forgot the lessons of this period: farmer discontent against big business could be contained only by constantly expanding market outlets...
...Quoted by Dan Morgan, "Food Aid Role Weighed," Washington Post, March 14, 1975...
...it also helped put detente on a firmer footing...
...Profits soared as the price of grain on the international market reached unprecedented levels...
...Under this program, food was sold in overseas markets by private exporters, who then either turned the sales proceeds over to the government agencies, or used the money to procure goods and services for the agencies' operations abroad...
...government is committed to a 5-year plan to modernize the South Korean army at a cost of $400-$500 million...
...efforts to prop up the Junta with economic and military aid have met with strong resistance in the United States, and the Administration has been forced to rely heavily on PL 480 to channel funds to Chile...
...Ability to provide relief food in periods of shortage or famine will enhance U.S...
...Due to the accumulation of grain surpluses in the 1950's and '60's, the operation of storage facilities by the large grain companies figured prominently in their market strategies...
...As a result, the world food economy has been left to the volatility of a "free market," where a slight shift in demand either up or down causes a huge swing in prices...
...1 8 Finally, the White House simply circumvented Congress by increasing the total budget for PL 480 from $1 billion to $1.6 billion-something it had refused to do at the Rome Food Conference...
...food sold in Chile on the open market did little to alleviate the plight of the Chilean worker, whose purchasing power has been eroded by an inflation rate of 600 percent...
...agricultural exports are bright, if Japan and Europe continue to increase their consumption of grain-fed meat, and if they can be forced to remove their trade barriers...
...And as the manufacturing facilities of the multinationals continue to move abroad, the productive base of the U.S...
...In fact, for the past two years, the Agriculture Department has not even requested any expenditures for PL 480, and the initiative has been taken entirely by the State Department...
...agricultural products, with last year's imports totaling $885 million...
...policies: first, they had to compete on the world market for scarce commodities at rising prices, and second, their financial position deteriorated as a result of devaluation...
...For the U.S...
...It called agriculture "the strongest weapon in the U.S...
...Over a century old, Cargill buys and sells commodities in every corner of the globe while also operating manufacturing plants that process everything from Midwestern feed grains, to salt in Louisiana, and soybeans in Brazil...
...Over the past two years, food has figured prominently in this strategy...
...21, 1974), promoting the idea that the United States should become the world's granary, in the name of comparative advantage...
...policy-makers were searching for ways to support the Indochina war effort...
...Even today this trend continues...
...The Central Intelligence Agency, Office of Political Research Potential Implications of Trends in World Population, Food Production, and Climate August 197417 Treasury George Schultz decided to use the issue of food as a lever against OPEC...
...In April of 1973, it was declassified at the insistence of the Senate Agriculture and Forestry Committee, and printed by the Government Printing Office for use of the Committee...
...cit., pp...
...The political usefulness of food aid stems mainly from Title I credits...
...The food weapon is likely to play a key role in these efforts...
...New York Times, September 19, 1975...
...grain exports are wheat, corn, and soybeans...
...Payoffs: Common in Foreign Grain Sales," Des Moines Register, July 13, 1975...
...Interview with an aide to a Senate Subcommittee investigating the grain trade...
...644 790 India...
...cit., pp...
...government, Korea Cargill began experiencing financial difficulties in 1972...
...channeled food aid to Chiang Kai-shek's forces in China through the United Nations Relief and Rehabilitation Administration...
...farmers' input costs...
...4 Another major cause of the U.S...
...Los Angeles Times, September 22, 1974...
...ad in a farm journal (Feedstuffs, Oct...
...allies in Cambodia and Vietnam, the focus of U.S...
...Highly favorable soil and weather conditions, combined with intensive application of technology and capital, make U.S...
...Cargill official, op...
...government and the grain corporations have used this position of dominance over the world's grain supplies to exploit people at home and abroad...
...2 9 SOUTH KOREA & MIDDLE EAST With the defeat of U.S...
...In other words, they should abandon policies aimed at self-sufficiency and allow the United States to become the world's granary...
...products distributed under PL 480 Title 11 donation programs...
...High profits in recent years have enabled the company to acquire a number of non-agribusiness firms, leading some to label Cargill a "mini-conglomerate...
...Some of the countries import large quantities of grain under U.S...
...2 115 Since the coup, U.S...
...Two important figures with direct ties to major agribusiness corporations were members of the Commission: Edmund W. Littlefield, chairman of Utah Construction and Mining and head of the powerful Business Council, who also sat on the board of Del Monte Corporation...
...balance of payments was increasingly in the red...
...New York Times, July 24, 1974 and November 23, 1974...
...Cargill's position as an integral part of U.S...
...3 9 Humphrey knows many of the Cargill officials on a first name basis and he makes occasional visits to the company chateau outside Minneapolis...
...policy makers, farmers are the necessary cogs in "on-line production factories" producing the commodity that will keep the U.S...
...Thus Third World countries were faced with a double hardship as a result of U.S...
...Today, Continental Grain and Cargill together control about 50 percent of the world's international grain trade...
...When this failed to reverse Korea Cargill's financial fortunes, it called upon the U.S...
...strategy for driving up the price of food on the international market, and Kissinger's efforts to use food as a weapon against other countries, must be opposed whenever possible...
...It now appears that the operations of the multinationals abroad are adversely affecting the U.S...
...In a letter to the secretaries of State, Commerce and Agriculture, Kissinger wrote: The Department of Agriculture in cooperation with other interested agencies should take the lead in developing for the President's consideration a position and a negotiating scenario for handling the issue of grain sales to the USSR...
...feed manufacturers...
...With the close of the Civil War, railroads began to crisscross the Midwest, thereby providing wheat farmers with ready access to national markets, while at the same time opening up new lucrative opportunities for the merchants and grain traders...
...and some admit that Americans will have to adjust to a permanently lower standard of living...
...economy has become increasingly dependent on imported raw materials...
...In justifying this approach, one official in Agriculture's Market Development program said, somewhat apologetically, in an interview, "Rich people have to eat too...
...investors in Peru, the State Department also "put the muzzle" on CCC credits to that country...
...2 2 Over the years Cargill and the other grain companies have become especially adept at tapping public financing...
...Among the grain companies, Cargill was the major firm to take advantage of the latter program...
...In 1966 Cargill built another soybean processing plant in the Netherlands, and in 1970 opened a third such plant in France...
...The report projects that a liberalization of trade would benefit the U.S...
...They still are generally family farmers, not yet overtaken by the corporations that either control or contract production in many other sectors, such as poultry and vegetable farming...
...secondly, at undercutting the efforts of other countries to follow the OPEC example...
...4 8 The Soviet wheat deal played an especially important role in Cargill's profiteering...
...Continental Bank of Illinois, op...
...But this target price is set so low it does not even cover the farmer's cost of production...
...The amount of commodities shipped under the program dropped in 1973 to an all time low of 3.3 million tons, one fifth the level of the mid-1960s...
...Before each year's crop is harvested, billions of dollars of grain are already sold to buyers...
...marketing and transportation system gave it far more control over the basic export commodity, grain, and enabled it to move strongly into European markets after World War II...
...3 7 In addition, Cargill directly manipulates many State organizations by placing its people in key government agencies, and by having a close relationship with the men and women who wield political power...
...In India, the U.S...
...cit., p. 272...
...When Cargill erects grain elevators, storage bins, or any other type of fixed asset, it often turns to insurance companies for long term loans...
...Under a rational and planned economic system this minor decline would not have resulted in a world-wide crisis...
...grain exporters from being competitive in the European market...
...agriculture an advantage due to the devaluation of the dollar...
...After the second devaluation in early 1973, the Japanese yen had appreciated 40 percent and the value of U.S...
...However, as a result of the market mechanism, this shortfall was transmitted into skyrocketing food prices in the industrialized countries and starvation in some regions of the Third World...
...officials were already discussing the possibility of a CCC credit to finance Soviet grain purchases...
...754 804 Spain...
...3 211 The impact in Third World countries, where most people spend 80 percent of their income on food, is to bring millions closer to starvation...
...By 1970, the deficit in this area stood at $3.4 billion...
...foreign policy...
...2 0 The relationship between the two goes back decades, at least to 1933, when John Peterson left Chase to join Cargill as its chief financial officer...
...3 Despite large loans from the U.S...
...9. Congressional Record, June 25, 1973, p. S11905...
...CAPITALISM'S CRISIS By 1970 the outlines of the U.S...
...grain agriculture the epitome of capitalist efficiency...
...One solution was to divert a large share of U.S...
...2 6 To force the Common Market countries to accede to U.S...
...In Argentina, the company is a major exporter of wheat and other grains, owns and operates export facilities, produces hybrid seed corn for the domestic market, and owns two large feed mills that manufacture livestock and poultry feeds...
...Cargill has not disclosed its 1974 sales...
...and Emma Rothschild, "The Politics of Food," New York Review of Books, May 16, 1974...
...grain exports involved government concessional financing of one type or another.* CARGILL'S DOMESTIC STRUCTURE "The Reign It's Plain is Mainly in the Grain" (from a Cargill pamphlet) By the 1950's, Cargill had expanded and consolidated its control over a huge network of merchandising, storage, and transportation facilities...
...2 3 The Nixon Administration was determined that this pattern not be repeated, and agriculture became a central factor in the U.S...
...And more importantly, in response to the Ford Administration's desire to control the inflationary impact of future Soviet purchases, the Soviet Union has agreed to work out a long-term arrangement to make regular, large purchases from the United States.21 As part of this agreement, the Soviets will reportedly also supply the United States with 3 percent of its oil import needs...
...demands, the Flanigan report recommends that the United States threaten to enact protective measures against industrial imports from Western Europe, and this is precisely current U.S...
...While the majority of Americans are forced to spend 30 percent of their income on food,**and at the same time are faced with rising unemployment, government officials recommend belt-tightening...
...grain surpluses set off a price spiral as other nations rushed to secure the remaining grain supplies...
...Every year they move billions of dollars of grains* from the surplus producing countries to the food deficit areas of the world...
...This budgetary support was often used by recipient governments to underwrite their military budgets...
...In addition, U.S...
...strategy led to an immediate increase in exports, the resurgence of agricultural production in Western Europe at the end of the 1940's lessened the demand for U.S...
...In 1973, in spite of the fact that the commercial surpluses the program was designed to dispose of no longer existed, barter sales reached an all-time high of $1.1 billion, four times the average level of spending in the 1960s.' 6 In 1974, Congress attempted to throw another wrench in Kissinger's plans to manipulate PL 480 for political purposes...
...Washington Post, 3/10/75, 3/12/75, 7/5/75...
...Memphis-based Cook Industries is a newcomer to the grain trade...
...See also Overseas Private Investment Corporation (OPIC), Direct Loan Investment Guaranty, Brazil: Cargill Agricola, S.A...
...its recommendations are echoed in the recent report on farm policy prepared by the prestigious Committee for Economic Development (with the help of William Pearce as consultant...
...Tradax performs the same merchandising functions abroad that Cargill carries out in the United States...
...Both the Departments of State and Agriculture agree that "food aid and food reserves are two separate questions...
...prices above world market prices, making U.S...
...farms still produced more than commercial markets could absorb...
...Jack Anderson, "Who Gets U.S...
...the United States was also importing more consumer goods...
...Many other investors feel as I, that inwardly Korea appears not to want foreigners...
...443 454 Republic of China...
...3 2 The promise of this money undoubtedly served as a highly persuasive bargaining lever for Kissinger in obtaining the recent Middle East agreement...
...Subsidized PL 480 food has undercut local producers and alleviated the pressure on Third World governments to make the structural changes essential to expanding food production...
...PL 480, appropriately named the Agricultural Trade and Development Act of 1954, has been the major vehicle for developing markets for U.S...
...In comparing Cargill to the public corporations, the company's sales for 1973 ($5.3 billion) were used...
...Thomas Hart Benton "Cradling Wheat" 193812 II...
...food aid has been to discourage agricultural development in Third World countries and to create dependency on the United States...
...Sources: Cook Industries, Inc., 1974 Annual Report...
...New York Times, November 6, 1974...
...As with Title I, the idea is to introduce these blended foods under the aid program and then shift to commercial sales...
...manufactured goods that were used as inputs by the foreign subsidiaries...
...farmers would be unable to offset the cost of machinery, fertilizers, and other capital inputs, which account for 70 percent of U.S...
...Thus the bulk of the world's food exports - be it grain from the United States or bananas from Latin America - flow to the industrialized nations...
...The Administration's Farm Bill, passed by Congress in 1973, ended government programs to withhold * In 1968, U.S...
...At present the three main U.S...
...agricultural commodities to be processed in their plants...
...trade balance, there is strong evidence that the movement of U.S...
...This Report focuses on how the U.S...
...transportation system as grain was moved from internal markets to the ports, the companies used their control of the railways to hold down the price they paid for wheat...
...The maximization of profits, the manipulation of the State, the insatiable thirst for foreign markets, and the exploitation of people's fundamental needs - these are all characteristics of capitalism which the grain companies embody...
...The outbreak of the Korean War caused only a brief spurt in grain exports...
...In the Middle East, food aid has played a somewhat different role, serving as a crucial bargaining chip in Kissinger's efforts to separate Egypt from more radical Arab countries...
...Even Cargill's official historian admits that by the late 1870's and 1880's the company held monopolistic trading positions "in southern Minnesota and South Dakota...
...food exports to Japan doubled.1 4 According to the President's 1975 Economic Report, the NEP was a significant factor in the 39 percent increase in U.S...
...United States Department of Agriculture, Commodity Credit Corporation, Storage and Handling Payments, 1958-1968...
...As part of the economic blockade orchestrated by Kissinger against the Allende government, food credits to Chile under PL 480's Title I were suspended...
...For more on U.S...
...as one of "structural corruption...
...The company is a stunning example of modern corporate capitalism, where small amounts of capital are used to control vast financial and commercial empires...
...These companies literally hold the power of life and death over millions of people...
...surpluses in times of overproduction, thus maintaining prices...
...1 9 For Cargill and the other grain companies, three Chicago based banks - the Continental Bank of Illinois, the First National Bank of Chicago and the Harris Savings & Trust - play an important role in financing grain inventories...
...Japan has developed an advantage in many fields, including electronics and photographic equipment...
...Politically, the 20-odd people who run Cargill are rock-ribbed Republicans almost to a man, and within the party they support the more conservative positions...
...Cargill official, op...
...Continental Grain Company Run by the Fribourg family, which owns 90 percent of the stock, Continental Grain originated in Belgium in 1813...
...But government programs had precisely the opposite effect of stabilizing the market...
...New York Times, January 28, 1975...
...policy-makers, whose chief goal was to expand exports in the cash markets of the affluent countries...
...Even though at the beginning of each fiscal year AID-which jointly administers the program with the Department of Agriculture-submits a projected budget, this list is only an estimate which can be altered without congressional approval...
...sponsored school lunch program, commercial purchases of blended foods by the Brazilian government now provide U.S...
...Financial Report submitted in December 1973 to the Securities and Exchange Commission...
...When Nixon traveled to Minneapolis in early 1964 to review his firm's accounts with Cargill, the company helped him arrange a conference at the Minneapolis Press Club...
...Senate investigator "there is sentiment within the grain community that Canada may go off the Wheat Board...
...See also, "The Effect of Corn Marketing by the Commodity Credit Corporation upon Small Business," Hearings before the Subcommittee on Special Investigations of Small Business Problems, June 14, 15, 22, 23, and 29, 1966...
...When a reporter recently called its New York office, the company's legal counsel refused to acknowledge publicly that Gerald L. Dreyfus