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"SI, SE PUEDE" BECOMES "SI, SE PUDO":
CALIFORNIA'S GOV. GRAY DAVIS SIGNS
CONTROVERSIAL FARM LABOR ARBITRATION BILL
JIM WASSERMAN, ASSOCIATED PRESS: Gov. Gray Davis, choosing between bitter opponents in one of the most controversial calls of the 2002 legislative session, has signed bills offering mediation to California farmworkers in labor disputes with farmers.
The governor's action capped months of political rallies that included a farmworker march through the Central Valley to Sacramento and a weekslong vigil by farmworkers and their supporters at the Capitol.California's seasonal farmworkers say the bills will help them get the larger paychecks, health care and other benefits typically given to workers in industries.
A group of about 50 who have sat vigil outside the state Capitol for weeks broke out in loud cheers and hugged and kissed as Davis staffers announced on the Capitol lawn that he had signed the bill. Juanita Ontiveros, the chairwoman of the UFW support committee for Northern California, called the signing "such wonderful news." The farmworkers "see a road to justice with this. They see that finally there is hope," she said.
After weeks of chanting the rallying cry "si, se puede," or "yes, we can,"
farmworkers holding a vigil at the state Capitol chanted "si, se pudo," Spanish for "yes, we did."
Davis called the bills "a truly historic effort," adding that "the bottom line is that too many people who were supposed to benefit from the protections of the ARLA (Agricultural Relations Labor Act) are left without a contract, without a remedy and without hope."
Senate President Pro Tem John Burton, Dem.-San Francisco, who carried the main bill and had clashed with Davis in August over the issue, said Davis "had pressure from both sides" and called the governor's signing "a good thing."
Farmers had lobbied hard for the governor to reject forced mediation for farm labor disputes. They called the bills unconstitutional and legally questionable. Growers and others inside the state's $27 billion agriculture industry also conducted a major letter-writing campaign to the governor's office, calling a newer concept of "mediation" simply a thinly veiled version of binding arbitration.
Mediation or arbitration would allow the state's Agricultural Labor Relations Board to force contracts on them, farmers said, and lessen California farming's competitive edge in the world economy.
The issue had placed Davis in a bind between the mostly Hispanic farmworkers, who are aligned with one of his most loyal groups of supporters, and the agriculture industry that had made significant contributions to Davis' re-election effort against Republican financier Bill Simon. Simon said Monday in Orange County he would have vetoed the bills. "I'm comfortable with that system as it presently exists," he said.
During the last days of August, Davis pressured lawmakers to pass a compromise bill that rejected the binding arbitration provisions in a bill they had passed only three weeks earlier. The new bill substituted a less stringent mediation process to break deadlocks in labor disputes.
Later, under renewed pressure from Davis, the Legislature passed another companion bill setting limits on mediation at five years and limiting the number of potential mediation cases to 75. It also doubled the number of days for required negotiations to 180 before bringing in mediators. Lawmakers portrayed themselves as having no other options under the threat of a veto and said they were making "significant concessions."
The bills apply only to farm operations with more than 25 workers.
Supporters for the state's farm laborers argued that farmers have historically stalled during contract talks and intimidated their workers. Many pointed out that since 1975, when the state created a collective bargaining system for farm labor disputes during Gov. Jerry Brown's administration, only 43% of unionizing elections have resulted in actual labor contracts.
During a long summer debate, the United Farm Workers Union countered farmers' claims that mediation and arbitration would put them out of business with support from statewide labor unions and Hollywood celebrities. The union also attracted widespread attention in mid-August with a 150-mile march from Merced to Sacramento. Since arriving, farmworkers have maintained an almost nonstop Capitol vigil with lighted candles and such religious symbols as the Virgin of Guadalupe.
That vigil ended in cheers Monday when they learned Davis had signed the
BRACEROS' TIME TO RECOVER BACK WAGES
EXTENDED UNTIL 2005 BY NEW CALIFORNIA LAW
ASSOCIATED PRESS: Gov. Gray Davis signed legislation [September 29] to give Mexican workers more time to recover wages they say were denied them when they came to the United States to work during World War II.
The bill extends the statute of limitations for legal claims through 2005. It is intended to help the more than 300,000 Mexican farm workers, known as braceros, hired by the American government to relieve the labor shortage during the war. Previously, no one could file a claim that was more than three years old.
"It's an outrage that many braceros who worked in California during a national time of need have never been paid for their labor," Mr. Davis said.
The labor agreement between the American and Mexican governments required that part of the workers' wages be withheld as a savings fund, to be paid upon their return to Mexico. But many never received the payments. Some never knew about the money, while others tried to claim it but were thwarted by the bureaucracy.
The workers and their heirs sued the American and Mexican governments and
Wells Fargo Bank in 2001 to recover the money. A Federal District Court judge
dismissed much of the suit in August, but the workers' lawyers say they will
continue to try to pursue the case.
SALOMON SMITH BARNEY FINANCIAL ANALYST
SEES NO FOOD BUSINESS OLIGOPOLY,
STILL "AN INCREDIBLY FRAGMENTED INDUSTRY"
KENNETH N. GILPIN, NEW YORK TIMES: The big companies that sell much of the food that Americans eat have huge appetites. In the last couple of years, they have been gobbling up one another.
The consolidation trend was at least temporarily halted this month, when Hershey Foods rebuffed an $89-a-share offer from the Wm. Wrigley Jr Company.
Jaine I. Mehring, an analyst at Salomon Smith Barney, talked last week about the meat-and-potatoes section of the stock market. Following are excerpts from the conversation.
Q. What is the logic behind consolidation in the food industry?
A. Normalized earnings-per-share growth is about seven or eight percent, but most companies would still tell you they are shooting for eight percent to ten percent. When I started covering the group five years ago, every chief executive told me it was 13% to 15%. Some companies have merged for cost savings to put more money into things like promotion. Some have merged because they wanted access to categories of food they didn't manufacture themselves. It also has to do with leveling the playing field with their retailers, who for a number of years were merging aggressively.
Q. Is the food business becoming an oligopoly?
A. Not by any means. The top ten beverage manufacturers have more than 80% of that market, as do the top ten household products companies. The top ten supermarket chains have more than 50% of that market. But the ten biggest food companies have a market share of about 20% It is still an incredibly fragmented industry.
Q. Are there formidable barriers to entry in the food business?
A. They are high to achieve national distribution and get that product slotted on a store shelf. And there are some food businesses, like chocolate, that are more difficult to get into. But you see new ideas spring up in the form of small private regional companies all the time. As far as the fundamentals are concerned, since the late 1990's they have deteriorated.
Most importantly, pricing flexibility has been unwound. In the late 1990's, companies were pricing some products at two to three times the rate of inflation, and were also pulling back on reinvestment. You never know when that strategy is going to fail.
Also, as retailers consolidated and as Wal-Mart emerged as the largest food retailer, the customer has been pushing back in terms of pricing. That takes away a big chunk of your earnings. And costs have gone up. Finally, over the last six to nine months, consumption volume has decelerated. That is strange, and is perplexing people. Most retailers are reporting that traffic in stores is depressed. When traffic is light, people buy staples, but not the impulse stuff.
Q. What is your take on the situation with Hershey Foods?
A. Well, the $89-a-share offer from Wrigley is still hanging out there. The situation is like watching someone rub two sticks together, and you are not sure if there will be a spark. It is either up to Wrigley to do something by pushing the issue, or to Hershey's board, who might pressure the Hershey Trust by claiming this was a very good offer that would benefit all classes of shareholders equally. Then you have the shareholders themselves. Where are they? Are they angry? The ultimate outcome will depend on whether there is activism. I think the chances are 50-50 that one or a combination of those constituencies will push for a deal. I am floored by how passive everyone seems.
Q. Do you consider any of the other big food companies takeover candidates?
A. I recently upgraded Campbell Soup and made the call that the valuation has finally gotten low enough to potentially attract the interest of someone trying to unlock value. The business has some discrete operations within it that have embedded value, like Pepperidge Farm and Godiva chocolates.
Q. Do you have other favorite stocks?
A. Kellogg is still very reasonably priced. It offers the best combination of earnings visibility, solid execution and valuation. Kraft Foods has been the best performer in the group this year, and I am still recommending it. And Hormel Foods, which is a different animal, is also recommended.
Q. Do you expect food stocks to suffer when the overall market improves?
A. The group has outperformed the market by 80% since March of 2000. Right now, the group is trading at 17.8 times forward four-quarters earnings, which is just about a market multiple.
When the technology bubble was peaking, the group got as low as a 55%
discount to the market. In the 30 years before that, the biggest discount was
20%. When the stock market decides that happy days are here again, the food
group will again underperform.
U.S. ASSET POVERTY FIGURES
REVEAL IF NATION'S POPULATION
HAD TO EXIST ONLY ON THEIR LIQUID ASSETS
NEARLY 40% WOULD LIVE AT POVERTY LEVEL
RAY BOSHARA, NEW YORK TIMES: Last week, in an annual autumn ritual, the Census Bureau released its latest statistics on poverty and income. After falling for four consecutive years, the poverty rate rose to 11.7 percent in 2001. But this figure, whether rising or declining, tells only part of the story about poverty in America: It measures only income. For a more complete picture --- and a more disheartening one --- it is necessary to measure the assets of the poor as well.
Between 1983 and 1998, the last year for which a comparison can be made, income poverty declined about 16%, while asset poverty rose 14%. Today, fully one-quarter of the United States population is asset-poor. This means that, if they had to live only on their net worth --- savings, home equity and other assets --- they could survive at the poverty level for three months. Take away home equity, or just consider liquid assets, and the poverty rate jumps to nearly 40%.
When families don't have enough income, they can't buy enough food, shelter, clothing and other necessities. With 33 million Americans now classified as officially "poor," income poverty is a huge problem. But at least twice as many families don't have enough assets --- and so they lose their economic security and their ability to plan, dream and pass on opportunities to future generations. Lack of income means you don't get by; lack of assets means you don't get ahead.
Clearly, both income and assets are important measures of well-being. But when the government frames the problem in terms of income, the solutions are framed in terms of income. Hence, reports of rising poverty are usually met with calls for greater income and food assistance, higher rental subsidies and increases in the Earned Income Tax Credit and minimum wage. The need for the poor to save and build assets is hardly discussed.
In fact, it turns out that the federal government has two policies. For the nonpoor, there is over $300 billion a year in tax breaks or incentives for individuals for asset development: tax deductions for home mortgages, favorable treatment for contributions to retirement plans or college-savings plans, myriad benefits for small business ownership and stock investment. Over 90% of these benefits go to families earning more than $50,000 a year. Combine these inaccessible income tax breaks with strict asset limits in public-assistance programs, and the poor face asset denial.
It's not that the government doesn't spend on the poor. It's that it spends very differently on the poor. They are grudgingly provided barely enough income and food to get by, while better-off Americans receive generous subsidies to build assets to get ahead.
This disparity in asset accumulation shows up in data on wealth inequality --- which, not surprisingly, dwarfs income inequality and reaches well into the middle class. The top 20% of households earn about 56% of the nation's income --- but command 83% of our wealth. The bottom 60%, the majority of the country, earns 23% of the nation's income --- but owns less than five percent of the wealth. And the bottom 40% earns ten percent of national income but owns less than one percent of the wealth. Despite the greater magnitude of wealth inequality, however, income inequality --- like income poverty --- receives far more public attention.
To be sure, there have been some efforts to rethink the poverty line, including a comprehensive study by the National Academy of Sciences, some of whose recommendations are now included in annual Census reports. And some advocates for the poor have proposed the use of a self-sufficiency standard to better capture the needs of the poor.
Most helpful, however, would be a set of policies to help the asset-poor, not just the income-poor. We know such policies can work. In a nationwide demonstration project, in which savings are matched on a two for one basis, the poorest of the poor --- those at 50% of the poverty line or below --- are saving more than three percent of their income. We can help the poor accumulate more assets with matching deposits and refundable tax credits for savings that lead to homeownership, higher education, business development, investment and retirement. To combat pervasive child poverty and enable asset accumulation throughout life, we could establish a savings account at birth for every person in America.
If we continue to combat poverty primarily in terms of income, we do not
merely mislead ourselves with a false sense of progress or an insufficient
sense of urgency. We also deny the poor benefits and strategies for improving
their lives that we have long offered to millions of other Americans.
RURAL NEBRASKA TOWN DEFIES
MULTINATIONAL CORPORATE AGRIBUSINESS:
PROVIDE PROMISED JOBS OR REPAY $1 MILLION LOAN
ROBERT E. PIERRE, WASHINGTON POST: In towns like [McCook, Nebraska], small and far off the beaten path, attracting new jobs is a rarity, and losing the existing ones a community tragedy. So it was a big deal five years ago when a multinational corporation, Valmont Industries Inc., promised to create at least 200 new jobs in exchange for a package of state and local grants and tax breaks.
It was seen as a win all around in this town of 8,500: residents would get jobs; stores and restaurants, more patrons; and families, the security of knowing that their children might have a place to earn a living in their hometown. "We're an hour's drive away from the interstate in both directions," said Mayor Linda Taylor. "We definitely need jobs. If the kids don't have jobs, they'll move away."
But the decision to lure Valmont --- which produces irrigation equipment in McCook --- was about more than keeping families together. It was a business deal that communities of all sizes make regularly in hopes of leveraging public dollars into jobs, opportunity and prosperity for their residents. Sometimes in the smallest of communities, the stakes are the highest.
As the deadline neared last fall, Valmont was at least 40 jobs short of its goal, making it contractually obligated to repay a $1 million loan --- with interest --- that otherwise would have become a grant. Company officials, however, appealed for a waiver, arguing that they had spent millions more than planned on infrastructure and paid higher wages than initially projected.
State economic development leaders and local business officials sided with the company, trying to pressure a reluctant city council to do the same. Taking a hard line on the loan, they feared, would scare off other companies that might otherwise consider locating in this part of southwestern Nebraska --- or lead to Valmont leaving.
But the town was intent on making the company live up to its end of the bargain. Taylor, the owner of a local video store, said she understands the ups and downs of business and is grateful Valmont came to town. But she said the town needed the 40 additional jobs that had been promised. She was among a three to two majority on the city council that rejected the waiver but allowed Valmont an additional five years to add the new jobs. "A deal's a deal," Taylor declared. Public interest advocates contend McCook did something that few in the cutthroat world of economic development are willing to do: stand up to big business at its own peril.
"The small towns don't want to make anybody mad," said Steve Virgil, an attorney for Nebraska Appleseed, which is in the midst of a two-year study of the state's economic incentive programs. "They're so isolated and so dependent on one large corporation for jobs that they don't want to go head to head with a corporation because the corporation would leave."
Across the country economic incentives are controversial --- and particularly disdained by advocates for the poor, who contend that tax breaks and grants are corporate welfare, often giving help to companies that would have created the jobs in the same place anyway.
But Stu Miller, deputy director of the Nebraska Department of Economic Development, said incentives are necessary, particularly in rural communities like McCook.
Most times, he said, they work out. Over the past five years, he said, nine out of 105 loans to businesses have defaulted because of bankruptcy, insolvency or inability to meet job requirements. In the three cases, including Valmont, where companies did not meet the job requirement, the department has reduced the goal. "We felt they were making a good-faith effort," he said.
Valmont, a Nebraska company founded in 1946, counts itself among those that try to do business the right way. With offices in China, Europe and South Africa, the company is a world leader in producing lighting and utility poles and the irrigation systems that are produced in the McCook plant. A decline in the agricultural sector and the overall economy led to the company's failure to meet the goal of creating 200 to 255 full-time jobs at that plant, said company officials, who have not threatened to leave McCook.
"We're not a company that abuses economic incentives and moves for an extra dollar," said Terry J. McClain, Valmont's senior vice president and chief financial officer. "Where you get criticism is from people who are not educated [about specific projects] and assume that business is somehow [cheating] the public out of something."
The company certainly has it boosters in McCook. Greg Wolford, who heads the local economic development corporation, said he thinks town leaders were wrong. "I was worried about creating a detrimental relationship with Valmont," Wolford said. "And I was concerned about future projects."
He said the focus on the $1 million was shortsighted. Average wages at the plant were 20% higher than the $7.65 per hour that had been projected. And he said the number of jobs created --- more than 160 --- was akin to 25,000 jobs in a big city.
"McCook in 1997 was fairly bleak," he said. "We needed some help. I cannot imagine what the town would look like today if [Valmont] had not been here. If another business came to McCook offering to invest $30 million and create 167 jobs, I would give them the same deal today." By standing firm, however, town officials by a slim margin defied the will of business and state economic development leaders.
"The bankers and the economic development corporation had worked for years to bring this plant here, and they didn't want us to mess it up," said John Bingham, the McCook town manager. "Their mind was made up, and they felt that people should stand in formation and salute."
Taylor, the town's mayor, wouldn't have done it any other way, despite the
controversy. Anyway, she said, there doesn't appear to be hard feelings between
the town and the company. "Valmont has been good for this community," she said.
"But we had an agreement. We needed the jobs [they promised] for our region, and
U.S. BANKRUPTCY COURT REJECTS
STOCKHOLDERS AND INVESTORS BID TO FORM
COMMITTEE TO REPRESENT THEIR INTERESTS
IN FARMLAND INDUSTRIES CHAPTER 11 PROTECTION
BLOOMBERG NEWS: Shareholders of Farmland Industrieslost a bid [September 26] to form a committee to represent their interests as Farmland, the largest United States farm cooperative, reorganizes under bankruptcy protection.
Judge Jerry Venters of United States Bankruptcy Court rejected the request from the John Hancock Life Insurance Company, the Commerce Indemnity Company, the Erie Insurance Company and others which own preferred and common stock in Farmland, according to an order posted on the court's Web site.
The order did not explain why the request was denied. Creditors and lenders holding $1.47 billion in Farmland debt had objected to formation of the committee, saying it would slow the reorganization, waste money and reduce funds available to creditors.
Judge Venters recommended that the bankruptcy-court trustee overseeing the case consider appointing three shareholders as nonvoting members of the committee representing bondholders.
Farmland filed for Chapter 11 bankruptcy protection May 31 after widening losses in its fertilizer business left it unable to service debt. On Tuesday, Judge Venters gave the cooperative until November 27 to file a recovery plan, a two-month extension of the original deadline.
Tens of thousands of individual investors are among those who have bought
Farmland debt and stock for retirement planning since the end of World War II,
analysts said. Their claims take a back seat to those filed by banks holding
liens on Farmland's slaughterhouses, fertilizer plants and an oil refinery. The
cooperative, owned by 600,000 farmers, was formed in 1929 to sell seeds,
fertilizer and other supplies to its members.
THE TRUE LIMITS OF MANUFACTURERS & COMMERCE
"Manufacturers, sufficient for our own consumption, of what we raise the raw material (and no more). Commerce sufficient to carry the surplus produce of agriculture, beyond our own consumption, to a market for exchanging it for articles we cannot raise (and no more). These are the true limits of manufactures and commerce. To go beyond them is to increase our dependence on foreign nations, and our liability to war. These three important branches of human industry will then grow together, and be really handmaidens to each other."
--- Thomas Jefferson, letter to John Jay, 1809
WORLD BANK PRESIDENT DECRIES
WEALTHY NATIONS OF "SQUANDERING"
$1 BILLION A DAY ON FARM SUBSUDIES
EDMUND L. ANDREWS, NEW YORK TIMES: For all the polite nods toward the protesters outside, those in charge of the World Bank and the International Monetary Fund offered few apologies [last] weekend for the many failed attempts to increase prosperity in the world's poorest countries.
Reflecting the views of their biggest shareholders --- governments of the world's richest countries, led by the United States --- both institutions continued to push poor countries to take steps to stimulate business: privatize industry, improve financial management, embrace free trade.
But as the two institutions wrapped up their annual meetings [in Washington, D.C.], people inside and outside the elite gathering attacked what some described as a major hypocrisy of the rich countries: their own continued barriers to imports, particularly of agricultural products and textiles.
James D. Wolfensohn, president of the World Bank, accused wealthy countries of "squandering" $1 billion a day on farm subsidies that often have devastating effects on farmers in Latin America and Africa.
Stanley Fischer, who was the fund's deputy managing director in the 1990's, said protectionist policies by the United States, Europe and Japan were "scandalous."
Oxfam International, a nonprofit group focused on world poverty problems, issued a scathing report in which it charged that subsidies to big American cotton farming operations were wiping out African rivals.
The criticisms are not new. But they are more intense this year, and they carried a special sting for the United States. Earlier this year, Congress passed and President Bush signed a bill that authorizes more than $100 billion in farm subsidies over the next eight years.
"It is hypocrisy to encourage poor countries to open their markets while imposing protectionist measures that cater to powerful special interests," said Nicholas Stern, chief economist of the World Bank.
Mr. Stern estimated that the average cow in Europe received about $2.50 a day in subsidies, and that the average cow in Japan received nearly $7 a day. By contrast, he said, 75% of the people in sub-Saharan Africa live on less than $2 a day.
On Friday, just as financial leaders from the Group of 7 major industrialized nations were about to meet, Brazil filed a legal complaint against American cotton subsidies at the World Trade Organization.
Brazilian officials contend that American cotton subsidies contributed heavily to a downward spiral in cotton prices that cost Brazil $640 million last year. India, another big cotton producer, estimated that American subsidies eroded its export revenues by $1 billion last year.
The Bush administration agrees in principle with the goal of reducing subsidies, which encourage overproduction and tend to depress prices, as well as tariffs and quotas that block imports.
In July, not long after Congress passed the new farm bill, the United States trade representative, Robert B. Zoellick, proposed that countries around the world agree on a sharp reduction in both kinds of protection. Because the plan calls for even deeper cuts in Europe than in the United States, American farm groups say they support it.
Protectionism in wealthy countries has a disproportionately large effect on poor countries, because the biggest barriers are on farm products and labor-intensive products like textiles. According to the World Bank, exporters from Bangladesh pay about as much in tariffs to the United States as exporters from France do.
Oxfam, which analyzed the effect of American cotton subsidies on African producers, estimated that American cotton subsidies eliminated one percent of the total economic output in three impoverished African nations --- Burkina Faso, Mali and Benin.
Mali lost about $43 million as a result of plunging cotton prices, which was significantly more than the $37 million in foreign aid it received from the United States. Over all, according to Oxfam, the American government spends three times as much on cotton subsidies as it does on foreign aid for all of Africa.
Other economists caution that farm subsidies are not the only reason for declining commodity prices. Prices for many other commodities have plunged in the last two years, partly because of the weak global economy and partly because of the rise of new producers.
Uganda, which has been diligently rebuilding its economy, has been battered by a huge decline in world prices for coffee --- its biggest export. But the International Monetary Fund and the World Bank can put much more pressure on poor countries than on rich ones to open up markets.
"The I.M.F. tells the United States that it should drop its subsidies
too," noted Mara Vanderslice, a spokesperson for Jubilee, an organization
that campaigns for debt relief. "But the United States doesn't borrow any money
from the I.M.F., so it doesn't have to listen."
U.S. OF A.: THE "WORLD'S BREADBASKET" ???
"Unfortunately you and other leaders have made some wrong assumptions. First, we don't need to feed the world. The world needs to be fed. But the U.S. and other global trade policies actually inhibit the development of vital diversified wealth creating and efficient food systems within, particularly, the developing countries. This paternal policy creates unrest, not world peace, forcing these countries to accept our imports when they either have or should have the capacity to provide for themselves. Secondly, is there really a demand for U.S. production?"
--- Herman Schumacher, a cattle producer, cattle feeder,livestock auction
operator and auctioneer from Herried, South Dakota in a 1998 letter to U.S.
Congressman Pat Roberts (Rep.-Kansas).
"I have heard . . . that people may become dependent on us for food. I know that was not suppose to be good news. To me that was good news, because before people can do anything they have got to eat. 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."
--- Sen. Hubert H. Humphrey, in naming P.L. 480 the "Food for Peace"
program, Wall Street Journal, May 7, 1982.
ADM AND CARGILL COME AWAY
FROM CUBA TRADE FAIR WITH
LUCRATIVE AG AND FOOD CONTRACTS
DAVID LUHNOW, THE WALL STREET JOURNAL: Fidel Castro got exactly what he wanted from an unprecedented five-day fair of American agricultural products that ended Monday in Cuba: cheaper food for his hungry people and a host of new fans, many of them staunch Republicans, who return home sharply critical of the U.S. trade embargo.
U.S. agribusiness didn't fare badly either, selling Mr. Castro's regime $52 million of products ranging from pasta and wine to hundreds of milk cows. Including the new purchases, Cuba has bought more than $172 million of "Made in the U.S.A." foods in the past year, placing it in the top 50 of some 228 nations that buy U.S. agricultural goods. Food and medicines, paid for in cash by Cuba, are the only U.S. products currently allowed under the 43-year embargo.
The fair's biggest deals were inked by sponsor Archer-Daniels-Midland Co. and rival grain giant Cargill Inc., each of which sold about $10 million to the communist country. Mr. Castro personally signed several contracts to show Cuba intends to pay on time.
The Bush administration opposes current moves in Congress to ease the embargo further. The new U.S. envoy to the island, James Cason, told American companies last week not to get too excited about Cuba's "Jurassic economy," but he faced an uphill battle fighting the public-relations blitz by the 76-year-old Cuban leader.
Most representatives at the fair were from rural U.S. states that supported
President Bush during the 2000 election. Just a few years ago, most foes of the
Cuban embargo in Congress were Democrats. That has changed as more Republicans
have lost faith in the embargo's usefulness and believe its demise could benefit
OREGON MEASURE 27 WOULD REQUIRE
FOOD COS. TO LABEL GE FOOD PRODUCTS;
NATIONAL POLLS SHOW MAJORITY OF CONSUMERS
OVERWHELMINGLY FAVOR SUCH INITIATIVES
PATRICIA CALLAHAN, THE WALL STREET JOURNAL: Buried among six other ballot measures in Oregon this November is an initiative that could upend the way the U.S. food industry operates.
Measure 27, the first of its kind to go before U.S. voters, would do what Congress and the U.S. Food and Drug Administration have declined to do --- require food companies to label products that contain genetically modified ingredients. About 70% of processed food contains genetically modified corn, soybeans or some other crop, according to food industry groups. Such crops --- which haven't been shown to cause health problems --- resist pests and weed killers and are easier for farmers to grow.
With the Oregon voter initiative, proponents of labeling may have found the food and biotech industries' Achilles' heel. By putting the labeling question before consumers, rather than politicians, such a law is more likely to be approved.
National polls repeatedly have shown that when asked if they would like to see information about genetically modified ingredients on food labels, an overwhelming majority of consumers answer "yes." Organizers of the Oregon measure collected more than 100,000 signatures to get the measure on the ballot. They've heard from labeling proponents in seven other states interested in introducing similar initiatives.
"If the food is so safe and the technology is great, why not put a label on it and let me have a choice?" says Donna Harris, a Portland mother who formed Oregon Concerned Citizens for Safe Foods, the group leading the labeling campaign.
The food and crop-biotechnology industries are raising a war chest to fight the ballot measure. In documents slated to be filed Monday with the state, the industries' group --- the Coalition Against the Costly Labeling Law --- will report it raised $4.6 million in cash in the seven weeks ended September 20. The group has so far spent about $1.9 million. Of the money raised, about $3.7 million came from Crop Life International, a biotech trade group. Most of the rest came from food companies, including PepsiCo Inc., General Mills Inc., Kellogg Co., ConAgra Foods Inc., Sara Lee Corp. and H.J. Heinz Co., according to Pat McCormick, head of the antilabeling campaign.
By contrast, the pro-label group has raised about $84,000 in cash, loans and in-kind contributions and has spent about $72,000 in about the past 1? years, according to the Oregon secretary of state's office. The group's largest contributor is Mel Bankoff, founder of Emerald Valley Kitchen Inc., a Eugene, Oregon, organic food company, who gave $47,500, most of it in loans, state records show.
The U.S. food and biotech industries have opposed similar laws, concerned that the labels would stigmatize their products unfairly. Such labels, required in parts of Europe and Asia, are "scary sounding," says Ken Yates, vice president of government affairs for the Northwest Food Processors Association, a Portland trade group.
Such a law would create a logistical headache for farmers, food makers and supermarkets. Could the industry apply special packaging to products destined for a single state? Such a system is possible, food industry groups concede, but it would require major, costly changes. Perishable products, such as bread and milk, often are produced locally, making it easier to comply with a state labeling law. But food companies make many processed foods at plants that often serve the entire country.
"They'd have to have an Oregon market and a market for the rest of the U.S.," says Stephanie Childs, a spokeswoman for the Grocery Manufacturers of America, a trade group representing large food producers. "It's one thing to set up a system for North America, set up a system for Southeast Asia, but to set up a system state by state?"
While food makers track products through lot numbers for recall purposes, food can change hands several times before it reaches its final destination. Food brokers buy products and sell them across the country. Other foods go to supermarket distribution centers, which can send products to retailers in different states.
The Oregon measure, which would likely face court challenges if passed, would require labeling of food sold in the state, as well as of products made or housed in Oregon and distributed to other states. The ingredients used in such products would have to be tracked carefully; a cake-mix maker, for example, would have to know if the hens that laid the eggs used in the mix ate genetically modified feed.
The campaign is heating up. A state packet explaining ballot initiatives, which will be mailed to voters, has 20 pages of published comments for and against the labeling provision. Oregon is the only state where all ballots are mailed to voters.
The anti-labeling group plans TV and print ads and mailings. Already about
330 road signs, many erected alongside farms, tell voters to "VOTE NO ON 27, THE
CO$TLY LABELING LAW." The 41-year-old Ms. Harris insists she and her campaign
aren't a front for any industry. "I'm really just a mom," she says.
CORPORATE AGRIBUSINESS RESEARCH PROJECT
WEB SITE INITIATES RENEWED SUPPORT EFFORT
It is rather curious that as more and more people from literally around the
to regularly receive THE AGRIBUSINESS EXAMINER, lavish in their much
appreciated praise for the work it seeks to do, fewer and fewer people seem willing to
financially contribute to its support.
Those handful of regular contributors who have earned the editor's undying
over the past four years and the few other occasional welcome individual supporters
stand in marked contrast to those many who obviously have believed during that time
that their aid could be better applied elsewhere, particularly when it comes farm and
rural organizations. Such neglect, however, when it comes to rural concerns is
recognized from this desk as not uncommon in our modern affluent and well fed
Since the AGRIBUSINESS EXAMINER first appeared some 193 issues ago it has
the publisher's intent to make the work of the Corporate Agribusiness Research Project
(CARP) and the monitoring of corporate agribusiness from a public interest perspective
available to the widest possible audience, seeing that those few and available publications
that still concern themselves with corporate agribusiness are so prohibitively expensive,
to say nothing of their pro-corporate bias.
But, because there is a more a need today than ever before to make corporate
agribusiness more accountable to the common good, it is the wish and hope of THE
AGRIBUSINESS EXAMINER to continue to play a major role in that effort. Your
contributions will go far in helping to perpetuate that hope. Such contributions may be
sent to the editor at the above address.
As part of a major effort to keep those committed to bringing economic and
democracy to rural America informed, educated and updated the Corporate
Agribusiness Research Project is happy to point out that its web site has been updated
Among the sites many features are:
> A complete index of THE AGRIBUSINESS EXAMINER'S first 162 issues
"Search" engine to provide easy access to the subject matter of each edition.
> Å new edition of THE AGBIZ TILLER, the progeny of the one-time printed
newsletter, featuring the essay "The Merchants of Greed," an in-depth essay dealing with
today's corporate agribusiness. Likewise the "Search" engine is also available for past
editions of THE AGBIZ TILLER.
> In "Between the Furrows," besides a modern "Search" engine, there is a
of pages designed to inform and educate readers on the inner workings of corporate
agribusiness. They include:
* CARP's "Mission Statement," "Overview" and THE AGRIBUSINESS
EXAMINER'S Editor\Publisher's "Resume."
* "Fact Miners," an effort to assist the reader in the necessary art of
* "Quotable Quotes" pertaining to agribusiness and corporate power
* "Links," a page which allows the reader to survey various useful
government and corporate web sites;
* "Feedback" an opportunity for reader input:
* The Corporate Reapers: The Book of Agribusiness, a page where
readers can order
directly the editor's 1992 published book from Essential Books.
The CARP web site was designed and produced by ElectricArrow of Seattle,
Simply by clicking on the address below all the aforementioned features and
are yours to enjoy, study, absorb and sow.