Hatian and California Farmers: Squeezed by the Same Company

I will make you a bet of
ten to one that, in a matter of months, relations are healed and the American
Ambassador returns. You forget-Papa Doc is a bulwark against Communism.
There will be no Cuba and no Bay of Pigs here. Of course there are other
reasons. Papa Doc's lobbyist in Washington is the lobbyist for certain
American-owned mills (they grind grey flour for the people out of imported
surplus wheat -it is astonishing how much money can be made out of the
poor with a little ingenuity).

-- Dr. Magiot, character in The Comedians, Graham Greene's 1965 novel set
in Haiti.

The U.S. owned Rice Corporation of Haiti (RCH) is Graham Greene's scenario
revisited more than thirty years later. According to a special Washington
Office on Haiti report, RCH began operations in September 1992 when former
World Bank official and post 1991 coup leader Marc Bazin's regime signed
a nine year development aid contract with RCH. RCH's corporate parent
is Comet Rice. Comet Rice has been the largest importer of rice in Haiti
for many years. The flood of its imported "Miami rice" in the 1980s, much
of it supported by U.S. tax dollars through various AID and USDA programs,
drove thousands of small scale Haitian rice farmers out of business. Corn
and other grain production also declined due to the importer's marketing
techniques.

Both RCH and Comet Rice are owned by a powerful U.S. company with a
history of what the New York Times called "tainted trade". They are both
owned by Erly, Inc., an international agribusiness and consulting conglomerate
with a history of repeated legal irregularities and close ties to political
power circles.

Under the terms of the contract signed with the de facto government,
RCH was supposed to improve Haiti's rice production create jobs, and assure
an ample supply of affordable rice to Haitian consumers. It was supposed
to increase Haitian rice production. In addition to importing a minimum
of 5,500 metric tons of bulk processed rice. RCH was supposed to accomplish
these objectives by establishing a rice processing plant in Haiti, providing
technical assistance, technicians, and the transfer of technology at the
level of national rice production and improvement of the distribution
system. The Washington Office on Haiti report concludes that three years
after the contact was signed, the agreement does not appear to have resulted
in its intended objectives of making Haitian rice plentiful and of high
quality or increasing Haitian rice production for sell to RCH for export.

o RCH for export. RCH and Comet Rice's roles in undermining food security
in Haiti do not, in this day of globalization, leave U.S. citizens untouched.
The plight of Haitian and U.S. rice farmers are intertwined. In December
1991, for example, "Comet Rice 'set the California rice industry on its
ear when it 'shocked growers with returns that fell painfully below competitors
prices' "(Sacramento Bee, Feb. 17, 1992). While other California rice
buyers that year paid $1.70 to $1.80 per hundred pounds above what the
U.S. government was paying for rice, Comet - with no advance warning -paid
25 cents. The growers' loss amounted to approximately $120 per acre. Not
only did Comet fail to warn the rice growers what was coming, but that
same year its parent company Erly, reported a net income of $3.2 million-a
sharp increase over the net earnings of $455,000 it reported the year
before. Over 150 growers resigned from their contracts with Comet and
formed a new marketing pool.

WOH's REPORT ASKS A CRITICALLY

IMPORTANT QUESTION:

How much of RCH's activity-either directly or through its chain of corporate
parents and siblings-has been funded by U.S. tax dollars? Various Erly
company activities have been subsidized by AID, USDA and possibly other
publicly funded agencies. Projects like RCH are typically championed as
promoting the privatization and free trade needed to 'develop' Third World
economies. Since the U.S. agribusiness system is enormously subsidized
by the taxpayer it does not itself constitute either 'free trade' or 'privatized' industry.

Institute for Food and Development Policy Backgrounder
Fall 1996,
Vol. 3, No. 3