Page 8 RAIN July 1979 • • • • • ••• •• ••• • ••• • • ••• ••• • •• • ••• • • •••• ••• • •• •• •••• • • • • • •• ••• • • • ••••• •• • •• • •• ••••• "Many of the 'economies' which they propose are, of course, real needs for small farmers. But to assume that CDC, or any multinational corporation, has the ability to de!iver these economies to the producing (or consuming) public is simply to ignore the inequalities at the core of the insurance/credit industry where CDC makes most of its profit. I'm talking about those key concepts like 'pooling of risks' which have long-since gone out the window in favor of 'high profit protectionism.' Said simply, over a lifetime what is a 'reasonable profit' for CDC would be beyond the imaginings of small farmers." "We have the technological skills available t; small farm organizers to far surpass those of CDC. We sbould not be intimidated by their pretense at technological ot managerial expertise. We can put together a producer/consumer controlled information system that both provides maximum leverage .in a monopoly market AND promotes cooperative decisions and action ,to fight that monopoly." • "In discussing the CDC proposition with a group of farmers this morning, not a one of them bought the argument that this kind ofapproach would help them AND their neighbors survive. And THAT is the political question!" "This project entirely bypasses the issue offair pricin,g for farm products. CDC is focusing their attention and ours on technology as a solution to young farmer, small farm problems. This is the same solution that is always brought up by business as a way to deal with problems of the 'Have-nots'- poverty, hu~ger; resource depletion, etc." "What intrigues me is the corporate strategy and longterm planning horizon thai seems to be implicit in these moves. I think they envision, not the demise.of agribusiness ·(rather the stabilization of agribusinessmen- large scale food processing and marketing on a more socially sustainable base); instead, the demise of the large farm operation component ofagribusiness·. Several of the corporate farmers (for example, Tenneco, which /CCR, Mark Ritchie and I studied intensiv,ely in 1976) have already moved substantially out offarming their own land and into sub-contracted 'or tenant farming. Less hassle, less public visibility, more profit. In its own perverse way, Wall Street shadows Wendell Berry: larger, even more centralized farms (above the 1,000 acre, $500,000 average) are just not sustainable in the ,credit markets of the . 1980s. CDC knows what kind of loans are most reliable. The social objective ofgetting more people back on the land (and off of welfare in the cities) just happens to ·coincide with an astute reading of longer- , term economic necessity." "The CDC programs are especially_interesting in light offarm policy reports of the "Committee on Economic Development." Their 1964 stateme'nt lJbserved that the agricultural sector could not support an adequate return to both capital and labor as then organized, and recommended that farm population be cut by one-third within five years through a policy of enforcing low farm prices. Their 1974 farm policy report observed the relative success that came from fallowing their program, identified a need to stabilize the declin~ of the small farm sector, and called for a program of direct welfare/subsidy payments to the lower three-fourths of the farm population." What are CDC's real intentiqns and their past record? ~lthou~h ultimate intentions may never be known, their more immediate plans were discussed in a meeting with small farm/ a.t. people in April. Although originally a computer company, _CD~ now gets 60 percent of its profits from credit operations, '"'.h1ch h~ve expanded from an initial lucrative program to provide car msurance for ex-cons. CDC has refined the "social responsibility" corporate public relations activities of past years into an ability to focus on small and disadvantaged. areas where people are incapable of shopping for alternatives, and set things up so it can quite profitably provide those services. ~s their 1978 Social Responsibility Report states, "The maJor problems of our socit;ty are massive, and massive ~esour_ces are requ.ired for their solution. The best approach 1s to view them with the strategy in mind that they can be profitable business opportunities with an appropriate sharing of cost between business and government." Restated, that says you can make a lot of money from government subsidies and appear to be solving society's problems as well. CDC is attempting to parlay ·its "social responsibility" projects into a coalition of support for their small farm proJ~Ct from church ~roups, farmers unions, major agribusiness firms, banks and msurance companies, USDA extension, community development organizations and the federal government. They have already in.vested three ·quarters of a million dollars in grants to major universities for supportive research for its small farm problem-with the hope of gett;ing the federal governme11t to match their funds on a 10 to 1 basis. If successful, the cori:>or~ium would similarly make available even more funds from the other coalition members. A "coalition" • in this case can possibly be defined as using other people's names, dollars and work while you get the profits. When pressed as to what CDC considered a ''reasonable" profit for its activities, it admitted that in one area at least bridge financing for farm land purchase, 18-20 percent pr;fit would be "reasonable and expected." CDC claims that the mainstream of their small farm project is not credit or an attempt to become an agribusiness company, but to provide the farmers with inforI].1ation services. "One hundred thousand farmers spending $500 ~ year on information is a $50,000,000 market. They spend more than that on crazier things." . But other questions remain. CDC "fully intends to vertically· mtegrate the small farmer." They also admit "you've got to realize that these things produced for the small farmer will be used by the large farmer." Norris is rabidly against non-profit organizations (asserting, I assume, that most corporations pay more_than ph~ntorr_i taxes). How d9 they view co-ops, CDC's workmg rela~10n with non-profits, and the government-funding for _CDC projects that they seek? Thejr statements of corporate ethics sound good-much better, in fact, than the $4.6 million in brib~s or "questionable payments" they've admitted making to foreign governments. And CDC's proposals are to improve th_e productivi~y of small farmers, when we clearly know that will depress pnces, make credit repayment more difficult and worsen the problems it attempts to solve.
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