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International Socialism, Winter 1966/7


Editorial 2

Bread and People


From International Socialism, No.27, Winter 1966/67, pp.2-3.
Transcribed & marked up by by Einde O’Callaghan for ETOL.


‘If the rate of food production cannot be significantly increased, we must be prepared for the four horsemen of the Apocalypse’ – B.R. Sen, Director General UN Food and Agriculture Organisation, October 1966.

A spectre is haunting the world. This time it is not the threat of revolt, but rather the prospect of mass starvation on a scale that might make the past crimes of capitalism look like gestures of generosity. FAO estimates that world population will increase from 3,400m to 5,000m by 1985 – 1,000m of the extra 1,600m being in the underdeveloped countries, with the majority concentrated in the poorest part of Asia. To feed these numbers, food production must increase by at least 4 per cent per year; in fact, since 1958 production has increased annually by no more than 2.5 per cent, and even this increase may not be sustained. Beside these needs, the pension of some 9-10,000m dollars that the advanced countries annually give the backward barely touches the problem, and ill compares to the 120,000m dollars they spend annually on means to destroy each other.

The industrialisation of countries requires either a relatively high level of surplus wealth (including natural resources) available for investment at home for long enough to create a modern economy, or a net inflow of investible resources from abroad, either as revenue on a commodity simultaneously capable of expanding home production and stable sale abroad, or from straight grants to, or foreign investment in, the backward economy. In practice, the first was important in American and Soviet development, and the second in European and Japanese industrialisation. Even so, the later the development took place, the more necessary was deliberate and ruthless State coercion to mobilise, direct and control investment, and the higher the concentrated cost. Yet the majority of contemporary backward peoples live in conditions where per capita income is too low to provide an investible surplus, where easily accessible resources are not available on a scale sufficient to be significant, where there are few (and declining) opportunities to export an increasing volume of the kind of commodities needed on the world market (oil is the one exception), and where the volume of aid and private investment is far too small in most cases to make a significant difference. In special conditions, some countries may still develop – Mexico, Puerto Rico, Greece, all three parasitic on a neighbouring economic giant; Taiwan, Thailand, South Korea, all crucial for US foreign policy. But the marginal case does not affect the general thesis that it may no longer be possible for those countries containing the major part of the population to develop. As a result, there is an increasing relative gap between advanced and backward – the backward are increasingly backward; at present rates of increase, the backward per capita income of £43 per year may increase to £61 by the year 2000, while the US equivalent will advance from £1,270 to £2,685. Efforts to overcome the current food shortage by the non-Communist backward have led to an increasing dependence on the US, a dependence which is only an ad hoc evasion of ultimate catastrophe. Having launched themselves into growth at the expense of the backward, the advanced have little further need of them, refusing concessions to permit the backward to export an increasing volume of goods to the advanced or even to emigrate, and reducing their aid commitment.

The subject of aid is obscured by Western rhetoric, but it has never reached, in total, the UN target (for the ‘development decade’) of one per cent of advanced national incomes – it was 0.84 per cent in the best year, 1961, and has since declined (0.65 per cent in 1964). While advanced national incomes have advanced by £10,650m, aid remains stuck at £2,185m. More than this, the tight liquidity in the West, compelling high interest rates and shorter repayment periods, is accelerating the tendency for much aid to be shadow boxing – the backward currently return about half the capital they receive in debt-servicing, amortisation, interest and dividends, and will, within the next 15 years, be returning 100 per cent. The worst hit so far is Latin America, receiving a declining flow of aid; since 1960, the average annual gross inflow of capital has been $2,300m, but the net inflow is only $267m, and in 1963 and 1964, the net inflow was only four per cent – 96 per cent went back to the advanced countries. Again, export price fluctuations can wipe out any net benefit from aid: in the seven lean years of the 1950s, Latin America lost in declining export prices an amount equal to all the aid it received, so that aid was no more than a subsidy that the advanced paid to cheapen their imports. In any case, aid is a relatively small element in the foreign exchange receipts of the backward: for example, in 1964, the backward received from exports 34.4, for foreign private investment 2.3, and in gross public aid, 7.8 (US$000m).

If aid holds no viable solution – it is in the main determined by the need for political support by the advanced, and the decline of the Cold War is rapidly decreasing that need (although the West still supplies nearly six times as much aid as the Eastern Bloc) – the trading prospects look as grim. With the exception of oil, the advanced are decreasing relatively their consumption of the primary commodities that the backward produce. The advanced have achieved 88 per cent self-sufficiency in oils, 83 per cent in fats, 73 per cent in cotton, 90 per cent in sugar, and are increasing these proportions. Other backward exports have reached saturation (tea, for example) or have been reduced by the substitution of other goods or synthetics, produced by the advanced themselves, or by economising on inputs. The FAO estimate that the value of exports of raw cotton, jute, hard fibres, rubber and tea will fall steadily up to 1975. Since 1960, raw material exports have increased by an average of one per cent, while world trade has increased by between five and seven per cent per year. Rubber production is increasing by three per cent annually, but synthetic rubber increases by 10 per cent and plastics by 15 per cent per year; or, again, world consumption of all textile fibres increased by 11 per cent annually from 1960, and synthetic fibre output increased by 50 per cent in the same period, but the consumption of raw cotton increases by only one per cent per year, and of wool, has actually declined – by 1975, synthetic fibres will have overtaken natural fibres in the making of textiles. Even with a continuous boom, advanced countries will increase their consumption of agricultural imports by only 1.5 per cent yearly. All this is symbolised in the declining share of trade held by the backward: the proportion of world exports in trade between industrialised countries increased from 37.1 per cent in 1953 to 45.5 per cent in 1964; simultaneously, the backward share declined from 27 per cent to 20.2 per cent, and if oil is excluded, this last figure becomes 14 per cent. All the efforts of the UN Trade and Development Conference (UNCOTAD) to open advanced markets to manufactured goods from the backward have failed – with sharper competition for a declining increase in world trade, the formation of the Common Market (and British application to join), US bilateral agreements with cotton producers, the British surcharge on imports, the quota restrictions of the French and Japanese, and so on, the trends are all in the opposite direction. Indeed, the bias of advanced tariffs is deliberately against manufactured goods – for example, raw hides enter the Common Market duty-free, natural leather collects a 9 per cent duty, and leather goods 16 per cent.

Weather failures have currently exacerbated the situation. Scarce foreign exchange now goes not on means to industrialise, but on the means of sheer survival by the ruling classes of the backward countries. At the present rate, backward demand for cereals imports could double by 1975, although there are few prospects that the imports could be paid for. The rundown on US grain reserves is now being reversed by some expansion in US grain acreage, but food has now become a primary coercive weapon in the pursuit of US foreign policy – Egypt and India are only the most extreme examples of subversion through the threat of starvation. With US grain comes economic intervention, producing in both these countries deflation (and devaluation in India – export earnings buy proportionately less food abroad) and a cutback in the pace of industrialisation. Liberals see the solution to this problem in technical adjustments– in lowering the tariffs of advanced countries, in an increase in world liquidity, in more intensive technical advice or a larger scale of aid, and even in contraceptives to relieve the population pressure that wipes out modest increases in national incomes. But these are, on the scale open to practical achievement, marginal palliatives. More centrally, no elements in the existing structure of world economic organisation – trade, aid, private capital – present the remote possibility of being able to stave off a major disaster. In the short-term, particular countries or even areas where the population is not already at the limit of existing resources, may develop, and the current disastrous foodgrains situation could be eased by a run of good harvests. But this does not affect the long-term; and neither India nor China – together with 1,200m people, forming the core of the problem – suggest any qualitative innovations likely to divert disaster at some later stage. In evading the issue, the ruling classes of both countries are likely to save their own power at the expense of their starving people – in the case of India, by indefinite mortgage as an American dependent; in China, by increasing autarchy and increasingly radical attempts to share increasing poverty. Poverty of this kind produces no proletarian vanguard, only the apathetic misery of those without hope, faced with ranks of American bayonets so numerous that desperate action constitutes suicide.

Only action from behind the bayonets, within the advanced countries, can offer any real solution. For the labour movements of the advanced countries, the responsibility for the future is very grave, yet there are few signs at the moment that they are capable of shouldering that responsibility. They have provided the only solution – a world socialist revolution – that would seem capable of success. No one doubts that, with the will, the advanced world could develop the underdeveloped in a short enough space of time to avoid disaster. But the will depends on the prior achievement of a society that regards the starvation of any man anywhere as a crime, as matter for urgent emergency action above all other priorities. And theoretical solutions are far from the active power to do the job.

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