Argentina, big soy, and agricultural tariffs

There are many dimensions to the agricultural protests which took place in Argentina this spring and summer, not least the role of transgenic soy in the destruction of agriculture and how a “withholding” tariff would affect that battle. This piece, written by a fellow Tlaxcalan, the Argentinean Jorge Eduardo Aldao, presents a different perspective on the strike from that presented in the translation of the Petras interview some weeks ago.

It’s not Love that United us, but Fright

Notes on the Argentine Agricultural Strike

by Jorge Eduardo Aldao

Translation: Machetera

“It’s not love that united us, but fright

would that be why I loved her so?”

Jorge Luis Borges

Without doubting the good faith of many people who’ve written about the agricultural strike that paralyzed Argentina for more than three months, a few clarifications are needed about this prolonged crisis which originated in the “Mobile Withholdings” imposed by the Argentine Economic Ministry.

The first thing to note is that it was not solely the rich who celebrated the defeat of the project by the government of Cristina Fernández de Kirchner, but many Argentines, among them myself included, who celebrated this legislative defeat.

And among those who celebrated and had participated beforehand in the pickets, besides landowners and their laborers, were factory workers and businesses linked to farming (who felt targeted by the measure) but also leftist groups such as the Independent Movement of Retirees and the Unemployed, led by Raúl Castells, the Maoist Classist and Combative Movement, and the Socialist Movement of Workers and the New Left, led by Vilma Ripoll, which makes it difficult to claim that this strike was only supported by the “agricultural oligarchy.”

As in the Borges quote that begins this piece, the worst oligarchic agricultural exporters, a middle class “hardened” and impoverished by military dictatorships and governments elected by neoliberal clearcutting, as well as humble workers and employees celebrated the government’s defeat. What united everyone was not love, but horror against what is being done by the “Matrimonial Presidency” of the Kirchners (because it’s already gone from being a matrimonial presidency to a presidency at the service of the political and economic interests of the Kirchner-Fernández duo).

We might point out to begin with, that President Néstor Kirchner began his presidential term in 2003, with an emphasis on the human rights of the victims of the most recent military dictatorship, a just and very necessary measure.

As well, he took another just and very necessary measure which was to “sink the knife” into a Supreme Court that with very few exceptions was absolutely corrupt and addicted to the government of the day.

But there the goodness of the Kirchner government ended, and he managed to be his own successor through the simple expedient of putting his wife, Cristina Fernández de Kirchner, up as a candidate for the nation’s presidency, and between the two, there’s not a lot of difference from the governments we’ve suffered since 1983.

To continue understanding the subject, it should be clarified that these withholdings which provoked such ire and that many believe to be taxes, are not taxes, although many websites have spoken of a “tax rejected by the rich.”

This is because the Argentine constitution establishes that taxes imposed by the national government should be established through a congressional law and spread over all provinces, in accordance with a determined schedule.

Despite this and for more than a century, many Argentine presidents have had the bad habit of calling for “withholdings” with the goal of putting their hands in the pockets of various producers.

In this way and over years, illegal taxation has been created, without the approval of representatives of the people, meeting in Congress, through relevant laws.

More importantly, these “withholdings” serve to punish or reward political opponents and to make the national state a generous collaborator of the businessmen friends of the government of the day.

Because these “withholding” revenues are not “distributed” throughout the provinces, and end up in a discretionary “black box” that serves for many things, mostly murky, they are driven through subsidies to the main Argentine businesses that manage energy, transportation and public works, as well as monopolistic agricultural sectors and the food business (supermarkets), all of them belonging to businessmen who are friends or associates of the power of the day, and who obtain benefits in Argentina which are impossible to obtain in Europe or the United States.

Furthermore, the “Matrimonial Presidency” also uses withholdings as a basis for political patronage that dominates the country today.

Therefore, those provincial governments whose deputies and senators are not docile with the Kirchner couple can forget about getting any part of these withholdings and, to make matters worse, the revenue that is “shared” from legal taxes will reach them “drop by drop,” late, badly, or never, plunging these provinces into a very complicated social and economic situation.

Conversely, the “addicted provinces” will enjoy unlimited funds, will be able to pay salaries and engage in public works and can direct, from the most remote provinces, large convoys filled with public employees to fill the Plaza de Mayo whenever Cristina Fernández de Kirchner needs them.

But the most serious aspect in all of this is that it’s not true that these withholdings have been designed to target rich agro-exporters and redistribute wealth toward hospitals, schools and roads.

The former National Deputy Mario Cafiero and Mr. Javier Llorens undertook a very serious analysis of the more than 55,000 shipping permits authorized during the last 18 months by Argentine customs and proved that these well-publicized withholdings were not designed to target the planting pools and agricultural exporters, but rather to benefit them, something that culminated in a criminal complaint which they filed jointly with the well-known Argentine attorney, Ricardo Monner Sanz. (Complaint text in Spanish here.)

This is because these agricultural export groups understand – because of their complicity with the government – that the withholdings would increase, and believing that the international price of soy would not go up further, favored themselves in permissive legislation and “froze” prices on exports not yet made (and therefore, also “froze” the value of the withholdings to be paid) in anticipation of their future Sworn Declarations Regarding Foreign Sales [DJVE in Spanish].

However, the price of soy continued to increase and the agro-exporters warned that no producer would sell soy at the frozen price, but they would be forced to deliver soy to fulfill their assumed obligations. The only way of meeting those commitments without losing money was to depress prices through an increase in withholdings that would oblige producers to sell at 2007 year-end prices, and so they went along, very kindly, with the matrimonial presidency of Néstor and Cristina Kirchner, dictating the famous Resolution 125 in regard to “Mobile Withholdings.”

Furthermore, these well-known and much discussed withholdings have not served solely to protect agro-exporters facing the demands for a better price by the small and medium producers, but have also served as another more or less legal way of defrauding the Treasury, since having “pre-sold” almost two Argentine harvests through the DJVE, the agro-exporters will pay withholdings for the 2007 and 2008 harvests at values prior to December 2007, instead of paying on their current value.

On the other hand, the affirmation of the Argentine government that the money from these withholdings would be designated for a “redistribution of wealth” in favor of the most needy, should be rejected.

First: there will be hardly any extraordinary income to the Argentine state coming from the mobile withholdings, for at least two years. This is because, as indicated above, the payment for the exports of two harvests were frozen before the price increases and therefore, they will pay for the lower prior withholding price on the two harvests.

Second: The decree that tried to put a “pretty face” on these withholdings through the creation of a Fund for Social Redistribution for hospitals, schools and roads, provides that only the portion of the withholdings that surpasses 35% of the FOB [Freight on Board] value will be earmarked for this, when in reality and in the majority of the cases, the Treasury has never charged more than 25% of the value, which makes this solidarity fund an illusion.

But to contextualize the matter a bit further, it’s also necessary to deconstruct the myth that President Cristina de Kirchner is concerned with “de-soyifying” agricultural production, in order to guarantee Argentina’s food sovereignty.

The exponential growth of the areas planted with soy was encouraged over the last four years by President Kirchner and his wife, since the withholding income on these exports was important revenue for the state.

Not only that.

The love of the Kirchners for soy is such, that in a trip to Venezuela, Cristina de Kirchner was accompanied on the presidential jet by the “Argentine Soy King,” Gustavo Grobocopatel, who promised to help Chávez boost soybean development in that Caribbean country.

The Argentine “soyification” pushed by the Kirchners was done at the cost of thousands of campesinos [very, very small farmers] who lived, along with their parents and grandparents, on state-owned lands of various Argentine provinces that, before the fabulous soy business, were coveted by speculators. These speculators convinced the governors of the provinces to sell them these state-owned lands for pennies and threw the campesinos off their humble parcels in which they planted and harvested “a bit of everything,” raised goats, pigs and chickens and had food security. These small farmers displaced by the armed patrols of the new owners (in the best Colombian style) are today without work and without food, on the peripheries of the people and cities of the “soy nation” encouraged by the Kirchners.

The same has happened with the massive clearing of hundreds of thousands of hectares of virgin forest and the displacement of the indigenous and the death of animal species essential to biodiversity. These clearings themselves, have diminished the capacity of the land to absorb water, and flooding of the rivers is increasingly common in the coastal areas inhabited by families with fewer resources.

During this long controversy, almost no-one has talked about these victims of “Kirchner soyification” and very little has been spoken of the inhabitants of the towns surrounding the fields of transgenic soy who are fumigated with the terrible herbicide Glyphosphate (the same used by the DEA in Colombia, against the coca plantations). Because these soy fields are fumigated with this herbicide in order to achieve what’s known as “zero tillage,” (in other words, no person working the soil to eliminate weeds), thanks to this fumigation, 4 out of every 5 agricultural jobs are lost for every 500 hectares, while an agricultural family creates and sustains 35 jobs for every 100 hectares.

Furthermore, Glyphosphate kills all vegetable species except for transgenic soy, and provokes dermatological, pulmonary, cancer and reproductive illnesses in many of these villagers.

Many of those of us who celebrated the defeat of Kirchnerismo don’t have anything to do with the agro-exporters, with the cereal transnationals, nor with Monsanto (Glyphosphate’s creator) nor with transgenic soy (another Monsanto creation). Nor are we with the reactionary sectors of the “bovine oligarchy” (or agricultural oligarchy) and we are strongly in favor of withholdings.

Also, we’re opposed to this model of monoculture that endangers all Argentineans.

Because of soy, many farmers turned their milk cows into hamburgers or razed their plantations of corn, wheat, and other cereals in order to begin planting soy, helping to expand this neo-colonial model of agriculture that condemns us to being only a foraging country; at the same time the desertification of the Argentine grasslands has begun, and once biodiversity is eliminated, the soil that is something very alive, is transformed into something very fragile.

But we’ve celebrated the defeat of a lying government that, in addition to all of the above, has done absolutely nothing in 5 years of governing to tax financial transactions for billions of pesos annually, that are not taxed at all, while it continues to impose a 21% Value Added Tax on all the products traded in Argentina, even those of first necessity, such as bread, milk, meat and cooking oil.

We’ve celebrated the defeat of a government that when it governed the province of Santa Cruz (the home of Néstor Kirchner, who is the province’s big boss) collaborated in the delivery of the Argentine oil and natural gas patrimony to foreign private companies. These companies, without investing virtually anything in new exploration, are draining Argentina’s energy resources.

We’ve celebrated the defeat of a matrimonial presidency that when it governed Santa Cruz province, in an extremely hidden manner, sent funds – that belonged to the province through the privatization of gas and oil – to Swiss bank accounts without, even to the present day, really knowing how much money was sent, if the money was earning interest, nor who benefited. Nor do we believe that this money has been repatriated to Argentina.

We’ve celebrated the defeat of a national government that recently has repeated the handovers of the past by ordering yet another handover by Santa Cruz province, this time, the oilfields of the Gulf of San Jorge, on the Argentine continental shelf, to companies that are emptying the hydrocarbon oilfields belonging to all Argentineans.

In summary, we are aware that this is a “war between gangs.”

On one side there’s the most powerful gang, the governmental gang, that with the mask of human rights conceals the fact that it continues to deepen the neoliberal policies of the military dictatorship and the government of Carlos Menem, and that had and has a clear alliance with transnational capital.

On the other side there’s the gang of the “rural party” which was complicit in so many coup d’etats unleashed in Argentina in the twentieth century and that, among its components, although there are no saints, has fewer alliances with international power and therefore damages the country a bit less.

It was necessary to weaken the stronger gang, but now we must turn the fight against the gang that has gained power, the agricultural gang, so that the food security of all Argentineans, sustainable development and respect for the very small farmers and indigenous are not trampled by soy.

Machetera is a member of Tlaxcala, the network of translators for linguistic diversity. This translation may be reprinted as long as the content remains unaltered, and the source, author, and translator are cited.

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