NACLA, "U.S. Grain Arsenal," Latin America and Empire Report, October 1975,
Chapter 2: "The Food Weapon: Mightier than Missiles."
The article argues that the United States is using its central position in world food production to further its interests internationally.
As the food crisis highlighted the world’s dependence on US grain, policy-makers incorporated “food power” into US foreign policy, especially after Vietnam with its political repercussions.
The chief weapon in the US food arsenal is the food aid program. While Kissinger expanded reliance on food aid as a tool for US diplomacy, it had been an instrument of US foreign policy since WWI. Hoover after WWI used food aid to support anti communist forces in E. Europe and after WW2 the US supported Nationalist forces in China and in W. Europe to counter working class threats and Communism. The passage of Public Law 480 in 1954 signaled a new era in food diplomacy. It was originally conceived to dispose of US farm surpluses and pave the way for exports. There are two main provisions of the law: Title I provides dollar credits to “friendly” foreign governments to finance the import of US agriculture and Title 2 where the US government finances donations to “friendly” nations by private international relief agencies. The political usefulness comes mostly from Title I credits, the foreign governments use the credits to import food and then sell that food commercially which means most of the food does not reach poor and hungry people. Until ’71 the US accepted the local currency generated by the food sales as repayment, and this money was thus useful in furthering US political and economic interests in that country. These “counterpart” funds were used in funding US government operations (including Department of Defense expenditures) thereby offsetting the outflow of dollars. Also have been used to loan to US corporations. Also used to provide economic support to US client states, such as South Korea where it was used to underwrite their military budget.
As popular opposition to the Vietnam War grew and made itself felt in Congress it became difficult for the Administration to get funding from Congress for economic and military aid. There was growing resistance to supporting repressive regimes. Congress was putting limitations on aid and foreign policy strategists were looking for ways to avoid this kind of interference. One solution was to divert US aid through multilateral institutions dominated by the US and another was to use food aid to support US diplomatic objectives. PL 480 programs are not subject to annual congressional appropriations and the president is empowered to spend up to 1.9 billion dollars in Title 1 and 600 million dollars in Title 2 by borrowing from the Agriculture Departments Commodity Credit Corporation. With commercial markets booming and government reserves exhausted the Agriculture Department no longer needs PL 480 to dispose of surplus. The State Department plays the major role in determining where aid goes.
PL 480 became a direct military subsidy for the Indochina war machine. In the beginning of ’74 the food aid to S. Vietnam was $207 million but when Congress cut economic aid by 20% the PL 480 allocation was then increased to $499 million. Also a special provision was made so Vietnam and Cambodia could use 100% instead of 80% of counterpart funds for direct military purposes. Also in ’74 Congress passed an amendment requiring that 70% of food aid be given to countries on the UN’s list of the Most Seriously Affected countries. The State department tried to get around this limitation by arguing that the limitation only affected food but not commodities like tobacco, also Kissinger tried to get the UN to put S. Vietnam on its list, which failed. Ultimately the White House circumvented Congress by just upping the amount of PL 480 aid from $1 billion to $1.6 billion.
Like other forms of US aid to Chile, PL 480 is turned “off” when the socialist government of Allende is in power and “on” when the US backed military dictatorship is in power. Title 1 funds would be turned off (which are about ¾ of PL 480 aid) with Title 2 continuing to maintain a low profile, non-official presence in Chile. Food played a part in the US backed coup of the Allende government. Right wing landowners would sabotage food production and the importance of food imports would go up while the working class increased its purchasing power thus forcing the doubling of food imports and exhausting Chile’s foreign reserves and making it very difficult for Chile to import food. The ensuing food shortages created middle class discontent and the Allende request for food credit was denied by the US. Since the coup there has been resistance for overt economic and military aid by the US so the importance of food aid has gone up. The food aid given to Chile (under the military Junta) that is sold on the open market does not ease the plight of the worker there because of the massive inflation and its erosion on purchasing power. But the Junta benefits as it eases it balance of payments difficulties and frees up money for its military, it’s the 9th largest importer of US arms.
The Agriculture Departments Commodity Credit Corporation, it extends credit to foreign nations to further US foreign interests and develop markets. It has a virtually unlimited spending authority and like PL 480 is turned on and off.
With the defeat in Southeast Asia the US has turned its attention elsewhere, particularly South Korea and the Middle East. The large increase in PL 480 funds that South Korea is receiving in ’75 comes just as Congress moved to phase out military aid to S. Korea over the next 3 years. Food aid is being used to fill in the gap, as the US wants to modernize the S. Korean military. In the Middle East the food is used to separate Egypt from the more radical Arab countries. Egypt receives the largest share of PL 480 aid.
A principal concern among policy makers is the new drive by Third World commodity producers to assert control over their own natural resources. The success of the oil producing states in setting their own terms and prices has led to attempts to do the same by others commodity producers as well. Added to this economic threat is the political threat of Third World unity that is posed to the US. Third World countries not only want control of their resources but also a restructuring of the international economic system that serves the interests of the developed nations. US policy has aimed at undermining OPEC and at undercutting other nations from following OPEC’s example and at driving a wedge between OPEC and other Third World nations. Food has been a primary tool. If food prices went up and more poor nations felt a price squeeze then they would be more likely to turn on OPEC. Kissinger played on this theme at the Rome Food Conference where he tried to blame oil induced inflation for “shattering the ability of developing countries to purchase food, fertilizer and other goods.” Then he tried to get OPEC nations to recycle petrodollars by financing US grain exports by saying that they have a responsibility to finance food aid to poor countries. Kissinger wanted commodity-by-commodity forums to discuss commodity arrangements so as to thwart a common producer front.
Food is used to support US client regimes, it is used as a bargaining lever to extract concessions and to wield against countries engaged in revolutionary processes. Also used against Third World countries that challenge US exploitation of their natural resources.
Summary by N. B. SCHWELLENBACH