Can Fairy Tales Come True? The Surprising Story of Neoliberalism and World Agriculture
The last half century has witnessed dramatic socio-technical changes in the agrifood sector, restructuring both city and countryside in radical ways. On the one hand, new genetic, genomic, transport and information technologies have become commonplace. On the other hand, new forms of intellectual property and new institutional structures have emerged. In particular, supply chain management and certification of suppliers have become commonplace activities among input suppliers and supermarket chains. At the same time various forms of resistance ranging from farmers' markets to organic production to fair trade have arisen. Why? Using the methods and insights of science studies, I argue that both agribusiness firms and their detractors have acted in response to the successful performances of neoliberalism in national and international settings. Hence, the current agrifood sector may be best understood as the product of continually evolving, and often conflict-ridden, negotiations between neoliberals, their supporters (who love it selectively) and their detractors. The moral of the story: fairy tales can come true, but they usually have surprise endings.
Once upon a time a small group of concerned intellectuals met in Paris at the invitation of Louis Rougier, a philosopher of physics and mathematics. It was August 1938. Hitler's regime was rapidly arming itself and had already incorporated Austria into the Third Reich. At the same time the Soviet Union was in the full grip of Stalin's reign of terror. Europe and perhaps the world was on the eve of another war, and everyone who attended knew that. The invitees were few. Among them were a number of leading advocates of liberalism including Michael Polanyi, Ludwig von Mises, F. A. Hayek, Jacques Rueff, Wilhelm Rüpke, Alexander Rüstow, Walter Lippmann (whose book was the formal occasion for the colloquium), several bankers, lawyers and industrialists, and two sociologists: Raymond Aron and Alfred Schütz. The invitees decried the failures of classical liberalism. They appear to have agreed on several critical points. Lippmann's (1938) latest work, The Good Society, spelled out clearly the problem at hand.1 Classical liberalism had failed nearly everywhere as the state had grown enormously in size. For the participants, this was true not only in Germany and the Soviet Union but also in the UK, France, and the USA. If left unchecked, the nation-state would stifle all liberty and freedom. The laissez-faire approach of classical liberalism was inadequate to the task at hand. It presumed that markets would work best if the state merely did not interfere with them. What was needed was a new liberalism – a neoliberalism – in which an activist state would be always and everywhere at the service of the market. Put differently, the role of the state would be to legislate in such a manner that the logical or mathematical model of the perfectly functioning market would be, as far as possible, realised in practice. The end result would be greater individual liberty – liberty bounded not by arbitrary rules of nation-states but by competition in the marketplace. The colloquium ended with an agreement on the need to establish a Centre International d'Etudes Pour la Rénovation du Libéralisme. The Centre would be located in Paris.
War intervened. Within a year of publication of the short proceedings of the colloquium France was under German occupation. But the ideas assembled there re-emerged as the war was ending. In particular, F. A. Hayek's (2007 ), The Road to Serfdom, serialised in the USA by Readers Digest, became an instant best seller. In a world which was weary of war, a world obsessed by the evils of communism and Nazism, Hayek struck the right chord.
In brief, Hayek (and his supporters) argued against any form of central planning, and for the use of markets – and especially competition –‘because it is the only method by which our activities can be adjusted to each other without coercive or arbitrary intervention of authority’ (Hayek 2007 , p. 86). Of note was that Hayek based this conclusion on what today would be recognised as a peculiarly post-modern idea: namely, that knowledge is always fragmented and incomplete. The magic of the market was that it could co-ordinate the affairs – the free decisions – of countless individuals without their needing to have complete knowledge of anything. Unlike planning, in which the planners picked the winners, markets merely established the legal framework (the rule of law) in which all comers had to act. Finally, Hayek suggested that there was a need for an international body that would promote markets even as it kept nation-states from engaging in activities that would limit the market. Moreover, this international body was to have limited power such that it did not itself become a tyrannical agent. After the war, Hayek and others formed the Mont Pelerin Society (2006), whose annual meetings would be a venue for elaboration of these ideas. While they are present only in embryo in The Road to Serfdom, they were developed at much greater length over the next three decades (Hayek 1973, 1976, 1979).
Clearly, the World Trade Organization (WTO), as well as various related organisations such as the World Intellectual Property Organization (WIPO), the World Bank, and the International Monetary Fund (IMF), are in large part the concrete manifestations of Hayek's imaginary. This is not to suggest an idealist interpretation of history in which the brilliant idea is inexorably realised in practice. On the contrary, the neoliberal orthodoxy – and it is certainly an orthodoxy today, even if battered by the recent financial crisis – has been enacted for other reasons.
Capitalism and freedom to operate
Why was Hayek's approach so rapidly taken up in more or less the same way (albeit with considerable variation) in nearly every western nation? Why did it become the orthodoxy in international development circles over just a few decades? Why did the former communist nations also find it a convenient mantra to replace that of state socialism? Why did it succeed in transforming the agrifood sector from research stations to consumers' plates and wallets in such a short time? And, why did non-governmental organisations (NGOs) pick up the neoliberal banner as well? In short, how did neoliberalism become a set of self-evident truths so rapidly, replacing those of classical liberalism as well as of non-capitalist visions of the future? The answers to these questions, I submit, lie in the way in which the neoliberal imaginary resonated with the goals and projects of the owners of corporate and financial capital. I will use the agrifood sector as case materials for my argument. I shall not critique the neoliberal project here (but see Peck 2004; Harvey 2005); but shall attempt to show instead how it was enacted.
Hayek, Milton Friedman (1962), and their supporters were convinced that political freedom and economic freedom went hand in hand. It was through free markets and the consequent development of entrepreneurial skills that political freedom emerged. The free market society, according to Friedman, would be ‘a collection of Robinson Crusoes’ (p. 13); each an individual striving to make his way in the world.2 Friedman got his chance to demonstrate the claimed validity of his thesis in 1975 when he accepted an invitation to go to Chile. Soon after, Chicago School graduates became key players in the regime of Augusto Pinochet. Arguably, neoliberal interventions in the Chilean economy ultimately helped to topple Pinochet's brutal regime and replace it with a democratically elected one. In the aftermath, Chile also became one of the world's leading counter-seasonal fruit exporters. However, at the same time, most social supports for the poor were dismantled. But this is to get ahead of the story.
Perhaps the best way to understand neoliberalism is as a complex of technologies – social technologies in the form of organisations, institutions and strategies enacted in part to bring it into being, but also artefacts of various kinds that have been coaxed along and channelled in certain directions in part because doing so meshed well with neoliberal goals and assumptions. Over the last several decades much of the world has been enrolled in the neoliberal project. In so doing, the way we are governed has changed rather radically.
As Latour (1987) pointed out several decades ago, new ideas do not effortlessly diffuse through society: people and things must be enrolled in networks in order for ideas to be enacted. Hence, the first task faced by neoliberals was the enrolment of allies. A two-pronged approach was employed. Corporate and financial actors were wooed by the prospects of greater profits in a global marketplace combined with a reduction in government intervention (read: limitation) in the form of laws and regulations. While some companies were quite comfortable with the government-regulated economies of the immediate post-war period – what Robert Reich (2007, p. 46) has called the ‘not quite Golden Age’– the temptation of reduced regulation, especially for key corporate shareholders and financiers looking for higher rates of return and top managers in the largest companies eager to design their own strategies with limited government intervention was nearly irresistible. The critical term here was and remains, freedom to operate. This would mean that many decisions previously restricted by legal and regulatory means would henceforth be made in company boardrooms and strategy sessions. Hence, it required little effort to convince financial and corporate elites that a neoliberal world would be to their advantage.
Secondly, the general population would be convinced through appeals to choice. The argument was simple: by extending the market, or market-like arrangements, to all sorts of places from which it had previously been absent, the range of individual choice would be greatly enlarged. People would be able to choose which healthcare plan to adhere to, which school to send their children to, which pension plan worked best, which companies would provide utilities that had hitherto been public and so on. Moreover, the elimination of various tariffs and quotas as well as non-tariff trade barriers would open the door to a cornucopia of goods and services.3 The inefficiencies of government-provided goods and services would be replaced by the allegedly greater efficiencies of the competitive marketplace. This approach worked particularly well in the USA and the UK as Reagan and Thatcher, respectively, were elected on deregulation platforms. But politicians in other nations as well soon raced to join the neoliberal bandwagon.
Arguably, the decisions of the early 1980s by the Chinese elites to open their nation to the world, as well as the collapse of the Soviet bloc in the late 1980s aided the neoliberal project immensely. It illustrated the failures of Soviet-style central planning and the bankruptcy of state socialism, thereby eliminating one of the few extant alternative futures. As was suggested at the time, when the Soviet Union ended the future appeared to have died as well. Margaret Thatcher summed it up when she famously noted that ‘there is no alternative’.
Neoliberal technologies of governance
The neoliberal project was also helped along by a series of governance technologies, or what Foucault (2007) called technologies of power. Despite the rhetoric of deregulation, the neoliberal project required (per Hayek) the creation of a new set of organisations,institutions and strategies.4 Four organisations are of particular import: the WTO, the World Bank, the IMF and the WIPO. In addition, the strategies of supply chain management (SCM) and the tripartite standards regime (TSR) (Loconto and Busch 2010, forthcoming) have provided large firms with new ways of acting in a neoliberalising world. Furthermore, financialisation has been an essential neoliberal technology of governance.
Perhaps the key organisation in all this was the WTO. The WTO is the instantiation of Hayek's 2007  dream of a global organisation that would enact neoliberalism. States adhering to the WTO agree to limit tariffs and quotas, to adhere to international sanitary and phytosanitary standards, to expand the scope of intellectual property rules and apply them evenly, to avoid non-tariff trade barriers – in short, to open their markets to global trade. Disputes among members are to be settled through the dispute settlement process, with trade sanctions imposed against the losers.
In short, the WTO provides a global legal regime that regulates and promotes the extension of markets globally – a regime that has gradually been extended to much (though not yet all) of the agricultural sector.5 Equally important, the WTO constitutionally has no jurisdiction with respect to labour, the environment, human rights or other non-trade issue of global importance. Indeed, it is legally blind to such issues.
The World Bank was founded after World War II as a means of rebuilding European economies under the leadership of Robert McNamara. Using the debt crisis of the 1980s as a lever, it rapidly transformed itself into a global entity that emphasised the neoliberal goal of a limited state and of integration of the former colonial world into the global economy (Goldman 2005). The Bank worked in tandem with the IMF (Harper 2000) to ensure that poor nations would not merely restructure their debts but would follow a neoliberal approach to solvency; structural adjustment became a global slogan as national systems of health care and education were dismantled, and transport infrastructure was allowed to collapse, all in the name of fiscal soundness.6 The collapse of the Soviet bloc opened Eastern Europe to both entities as well.
Finally, WIPO was developed to ensure that intellectual property rules would be globally harmonised, so that something patentable in one nation would be patentable everywhere. Moreover, in keeping with the neoliberal belief that all exchanges that can be made into market exchanges should be so transformed, WIPO has aided in expanding the range of entities that may be subject to patents, copyrights and the like. Among the items on the expanded list are seed and pharmaceuticals, entities that for the last several centuries were largely outside the realm of patentability.
Furthermore, to the extent that WIPO contains nearly all the nations of the world, it is rather slow in its deliberations. The agreement on trade-related intellectual property rights (TRIPs), linked directly to the WTO where the larger trading states dominate, has helped to push along recalcitrant nations. Under the TRIPs agreement patents are to be enforced with equal vigour everywhere, such that, for example, a multinational company might demand that one nation bring a suit against another nation for failure to enforce intellectual property rules.
Perhaps no one has benefitted more in the agrifood sector from these policies than have seed producers, especially Monsanto. Thanks to the expansion of intellectual property rights (both to seed as IP and globally), and the expansion of ‘free’ trade, Monsanto now dominates the world seed market with an astonishing 23 per cent share (ETC Group 2008). The top ten companies control some 67 per cent of the market.
Food processors and retailers have also benefitted considerably from these new organisations and institutions, especially the WTO. Even as the USA and the EU continue to maintain agricultural subsidies, thereby depressing the prices of primary products (especially grain and oilseed) in the rest of the world, multinational processors and retailers have been able to expand the scope of both their purchasing and sales considerably. Global trade in food and agricultural products has thus increased markedly, with exports rising from US $135 billion in 1961 to almost US$ 12 trillion in 2006 (FAOSTAT 2009). And, at the same time, the share of packaged food sold in supermarkets worldwide is now estimated at 51 per cent (Economic Research Service 2008). One consultant estimates that 70 buying desks for supermarket chains now control most of Europe's food supply (Grievink 2003). Doubtless, the situation is similar in much of the rest of the world.
Furthermore, supermarkets have extended their reach far beyond national borders. Whereas little more than a decade ago supermarkets in poor and middle-income countries were locally owned and supplied mainly the upper classes, today more and more middle-income and even poor consumers buy at least some of their food in supermarkets owned by multinational chains. In short, these supermarkets source and sell in a wide range of countries (Reardon et al. 2003; Weatherspoon and Reardon 2003; Dries et al. 2004; Konefal et al. 2007). The result of all this is that shoppers in most nations can now find a veritable cornucopia of foods and food products on the shelves of their local supermarkets if they can afford it.
To a lesser extent European farmers and small processors have benefited through the extension of intellectual property to include geographical indicators (including appellations). In contrast, in the USA the federal government, backed by large processors and retailers, has been quite opposed to such indicators, although individual states have seen potential benefits for local rural development. Furthermore, much to the embarrassment of the United States Department of Agriculture, several commodity groups banded together to successfully get Congress to enact a country of origin labelling law.
Furthermore, in addition to the organisational technologies described above, two new and intertwined strategies were invented to extend neoliberalism to the world: SCM and the TSR. It is important to note that these strategies were not initially part of the neoliberal project. One will look in vain in the classical works of neoliberalism for information about either supply chains or standards. On the contrary, these twin strategies were invented as a means for firms to have their cake and eat it too. While large firms (and even many mid-sized and small ones) appreciate the withdrawal of the state from direct action in the marketplace as well as the expansion in the size (global) and scope (anything that can conceivably be bought and sold) of the market form, neoliberalism also celebrates competition on a level-playing field. Indeed, competition is its central dogma, its DNA. But, as any neoclassical economist will tell you (perhaps with some reluctance), in a world of perfect competition, profits cease to exist. Clearly, no firm wants to play an economic game where profits evaporate.
The solution to this problem can be found in the invention of SCM and TSRs. SCM involves abandoning, or perhaps subsuming, the economic theory of the firm in favour of the entire supply chain seen from the vantage point of the supply chain captain, that is, the firm that leads the chain (Busch 2007). In the case of the agrifood sector the captains that have emerged have been largely supermarkets. The top five are well-known global retailers: Wal-Mart (USA), Carrefour (France), Tesco (UK), Metro (Germany), and Ahold (The Netherlands)7 (CIES 2009). Such captains take on the role of organising the chain from acquisition of raw materials all the way to purchase by final consumers. However, in order to accomplish that goal as well as to protect their reputations, the captains demand that their suppliers adhere to a set of stringent standards.8 Moreover to ensure that the suppliers adhere to the standards; to avoid the costs of checking; and so as not to cast themselves in the role of police officers, the lead firms require that some third party certify that the suppliers are operating in conformity with the standards. Furthermore, in order to ensure that the certifiers themselves behave as expected, the lead firms demand that certifiers be accredited by international accreditation bodies. The result is to create a space that is nominally in the free market, but in which all players in the supply chain are governed by the lead firm (or grouping of firms, such as GlobalGap) which to a considerable degree protects the chain members from the vicissitudes of the market. However, it does this while at the same time attempting to ensure that most of the value-added accrues to the lead firm. This strategy of governance can be called, following, John Stone (Loconto and Busch 2010, forthcoming), a TSR, consisting of standards, certifications, and accreditations.
Importantly, the TSR has arisen alongside the international state organisations described above as a kind of virtual or quasi-state, what Foucault (2007, 2008) might have called a governmentality. Today, the International Accreditation Forum, the International Laboratory Accreditation Cooperation, the International Organization for Standardization, and several other similar, but more specialised, non-state bodies govern aspects of much international trade. In the agrifood sector we can also identify the Codex Alimentarius, GlobalGap, CIES, Safety Quality Food and the Europe-Africa-Caribbean-Pacific Liaison Committee among others. Both nation-states and international organisations have been more than happy to help in establishing such entities. Yet, they are rarely mentioned in neoliberal or neoclassical economics texts.
The final technology of neoliberalism that needs to be introduced here is financialisation, that is, the tendency of financial markets to dominate and for financial organisations to dictate conditions to those organisations involved in production. Here the neoliberal twists and turns are more difficult to follow. Harvey (2005, p. 33) sums it up by noting that ‘Neoliberalisation has meant, in short, the financialisation of everything’. But one will look in vain through neoliberal texts for any statement suggesting that finance should dominate. Indeed, financialisation has occurred in at least four interrelated but quite different ways.
Firstly, financialisation refers to the growing role of financial transactions in the everyday lives of the middle class in the western world and elsewhere. The shift from defined-benefit group plans for healthcare and retirement to individualised plans has made many of us into investors. For example, whereas only 3 per cent of Americans owned stock in 1929, today more than half own at least some stock (Langley 2007). This transformation has been very much in keeping with the neoliberal transformation of state-sponsored social protection into products of individual responsibility, that is, from placing the burden of risk on the state or firm to placing it on all individuals who are now responsible for managing their investment portfolio. In addition, credit card debt has soared; whereas food stores previously did not accept credit cards, today they do. And, of course, mortgage debt ballooned (especially in the UK and the USA) leading to the bursting of the housing bubble in 2008. In short, a very substantial portion of us are implicated in and help to support financial markets.
Secondly, financialisation refers to the global domination of production and service industries by the financial sector. This has occurred more as a result of omission than commission. That is, neoliberals have been so concerned with introducing competition everywhere, attempting thus to turn all social relations into markets or quasi-markets, that they have given short shrift to potential problems associated with financial innovation. Indeed, neoliberalism appears to lack any theory of production. Its proponents apparently presumed that production would follow new market opportunities as new products were invented that accomplished new tasks or were more efficient at accomplishing old tasks. But for bankers, innovations are new kinds of financial instruments that increase the profitability of financial institutions while ostensibly keeping risks (for the bankers) within established bounds (cf. MacKenzie and Millo 2003). Indeed, financial innovations have abounded, ranging from securitisation of mortgages to the invention of hedge funds and sovereign funds. Already, by the 1980s many manufacturing corporations (such as General Motors) had established financial divisions that were more profitable than their production lines. So attractive has finance been that even Wal-Mart has attempted to establish itself as a bank so as to enhance its profits. (It failed in the USA (Biano 2007), but succeeded in Mexico (Gelpern 2006–2007).)
Indeed, the financial sector grew at breakneck speed until the recent string of bank collapses. Moreover, in direct violation of neoliberal norms of behaviour, when the entire global financial system appeared likely to disintegrate, central bankers were all too eager to make good on bad loans, nationalise banks and otherwise act in clearly Keynesian ways.
Thirdly, the actions of the IMF and World Bank, as described above, clearly involved the use of the power of finance to restructure entire economies. At any given point in time a nation might have simply defaulted, opting out of the global financial system. After all, there is no International Court of Financial Settlements with the power to enforce IMF or World Bank loan repayments. Numerous times, as nations have reached the brink, such ‘solutions’ have been posed. Indeed, when Luiz Inácio Lula da Silva first ran for President of Brazil, there were many who feared that, if elected, he would let Brazil default on its then massive debt obligations. But, in each case the financial networks proved more solid than they appeared. Some loans were rescheduled; others were forgiven. But the international financial networks managed to retain control.
Finally, the recent rapid rise in the prices of grain and oilseed appears to have been due in part to neoliberal policies. Specifically, in the past grain futures markets have been closed to all except those actually concerned with the grain business, that is, farmers, shippers, and processors. These individuals and firms use these markets as means for reducing price fluctuations and stabilising their incomes. But in recent years those markets have been opened to speculators. There is now considerable evidence that speculation on world grain markets was a major factor contributing to the rapid rise of grain prices far beyond any shortage that might have been brought on by harvest shortfalls or diversion of cropland to agrofuels (cf. Lobstein et al. 2008; Pace et al. 2008a, 2008b). As Burch and Lawrence (2010, forthcoming) put it:
The catalyst for this development – along with the fact that the agri-food commodity sector at the time was increasingly attractive in terms of the returns it generated – was the decision by the Commodity Futures Trading Commission (CFTC) (the US regulating agency with responsibility for managing futures markets) to allow an increase in the number of futures contracts that hedge funds could hold.
This appears to have opened the door, while the actual speculation was brought on by the comparatively poor performance of financial markets. Under those circumstances, grain markets as well as other commodity markets became potentially higher yielding than other investments.
Technologies of neoliberal governance
But it would be an error to see the advent of neoliberal governance as merely a matter of neoliberal technologies of power. As Latour (2004, 2005) and Haraway (1997), among others, have taught us, we live in a world that is populated by people and things. Things count; they are transformative because new things open new possibilities (Dewey 1927). In recent years we have seen at least four new classes of technologies develop, each of which permits the enactment of the neoliberal project in ways not previously possible: genetics and genomics, nanotechnologies, transport and information and communication technologies (ICT). Let us examine each briefly.
Genetics and genomics
The technologies of genetics and genomics are highly individualising. Hence, these technologies are well-suited to enclosure as private property. The central dogma of genetics is all about the formation of individual entities. Individual organisms, we are told, are programmed by their genes to express not only certain physical features, but certain forms of behaviour. Geneticists look, with varying degrees of success, for the gene that codes for various diseases, that confers drought tolerance on crop plants or increases milk yields in dairy cows.
In addition to making living things more easily appropriable, genetic and genomic technologies have the effect of compressing time and space in such a manner as to increase the rate of turnover of capital. On the one hand, the time required to move genetic material from one organism to another can be reduced considerably. On the other hand, the space required can be drastically reduced. Both are accomplished by shifting much of the field biology required by breeding programs into the laboratory. Indeed, in the late 1980s claims that plant breeding would be all but eliminated, as well as claims of having developed 2-m tall cows and nitrogen-fixing maize were commonplace (Busch et al. 1991). These claims have since been tempered.
Moreover, Richard Dawkins (1989) has even gone so far as to argue for a gene-based determinism, pushing individualism all the way down to the level of the (now patentable) gene. Although Richard Lewontin (1992) pointed out some time ago the limits – perhaps the absurdity – of this approach, it has yielded some low-hanging fruit: glyphosate (Roundup®) tolerance in soybeans, insect resistance in cotton and bovine somatotropin for dairy cows have been among its marketed products.
On the horizon, if we are to believe its proponents, is nutrigenomics, which will permit personalised diets (Afman and Müller 2006, cf. Chadwick 2004).9 Further down the road, proponents of proteomics, metabolomics and other ‘omic’ sciences promise us a variety of other individually tailored products and processes. As one observer notes, ‘ “omic” disciplines have emerged, with the goal of analysing the components of a living organism in its entirety’ (Evans 2000, p. 127, emphasis added).
These new fields of biology are marked by some considerable differences from older sciences. They presume that the variables of concern are to be found at the molecular level. They rely not on hypothesis testing, but on the collection of massive data sets from microarrays in which patterns may be found. They have played an important part in the further privatisation of agricultural research, with its attendant greater secrecy and patent protection. Finally, they have shifted attention away from what agronomists call ‘cultural practices’, that is, the practices employed by farmers to manage their fields,10 as well as agroecology and virtually ended support for taxonomic studies.11 Even studies of the ecological effects of widespread use of various products of molecular biology have been largely neglected. Indeed, recently a group of US entomologists complained that they were denied access to the materials necessary to engage in such research (Pollack 2009).12
Anyone who entered a port prior to the 1970s would have witnessed a rather chaotic scene in which piles of goods, packaged in various ways, were heaped up in and around great warehouses. These, in turn, were packed into awaiting breakbulk (cargo) ships. Large numbers of itinerant dock workers carried goods on their backs or on carts to the waiting ships. The ships themselves were in port for weeks at a time unloading and loading. The ports themselves tended to be rather dangerous places, both because of the risks in handling loose cargo and because the heaps of goods on the docks tended to attract thieves (Russell 1966).
In contrast, in all the major ports of the world such scenes have virtually vanished. Today, ports are essentially large paved parking lots with thousands of containers stacked on top of each other and moved about by enormous gantry cranes operated from high above the ground. This was made possible by the development of standard-sized containers that could withstand stacking (for use on ships and docks) as well as pressure exerted on either end (for use on railway cars), could be easily attached to ships, railway cars and lorries (with twist locks) and that could be lifted by specially designed cranes.
Moreover, the advent of containers has been accompanied by a rapid decline in the need for dock workers, the rapid development of intermodal container transportation (by ship, train, lorry), the removal of manufacturing from the immediate vicinity of ports, as the need to be close to the port was eliminated, the domination of ocean shipping by a handful of enormous container ports served by very large container ships and the redesign (and often relocation) of ports to accommodate containers first and foremost (Levinson 2006).
Importantly, this transformation, largely taking place from 1970 to 1990, was itself dependent on the deregulation and re-regulation of shipping. In particular, it involved the abandonment of separate rates for different kinds of goods, often fixed by nation-states, replacing them with flat, market-based fees for the shipment of individual containers. At the same time as the state was ridding itself of shipping rules and regulations and spending massively to create giant container ports the private sector became involved (with considerable state support) in developing a global agreement on the size, shape, design and coupling devices that would be used to make shipping containers into standard commodities. The agreement was sufficiently effective that global trade is now measured in TEUs – twenty-foot equivalent units – where shipping container height and width are fixed and length may vary from 20 to 48 feet.13 The consequences included a sharp drop in shipping rates and a removal of much manufacturing from the western world to China and other locations with large container ports and cheap labour.
A third area of neoliberal interest has been nanotechnologies (ETC Group 2004; Joseph 2006; Kuzma and VerHage 2006). Arguably the least understood of the new technologies under review here, nanotechnologies – despite their mislabelling as solely size-dependent – are all about the quantum properties of matter that can be exploited only at small scale. Specifically, at the nanoscale the ratio of surface area to mass increases dramatically, amplifying various quantum properties and permitting the creation of new forms of products and processes. In particular, they permit control at a very detailed level (although, ironically, it is at that scale that objects become very difficult to pin down). For example, smart dust, small chips that are broadcast (literally) in a vineyard or orchard, permit the monitoring of various parameters from a distance, and highly specialised follow up. Hence, smart dust might signal the need to reduce insect populations in a narrowly defined area.
Other examples of nanotechnologies in various stages of development are ‘lab on a chip’ devices to monitor individual farm animals for multiple diseases in real time. Particularly important is the growing use of radio frequency identification (RFID) devices to tag animals and products in fields, warehouses and supermarkets. Widespread use of such devices permits faster and more accurate inventory control, reduced pilfering, detailed real-time monitoring of what is on store shelves, thereby reducing out of stock problems (Gruen et al. 2002), and eventually rapid checkout with purchases automatically charged to consumers' credit or debit cards (Metro Group 2005).
The story of RFID provides a particularly interesting example of how neoliberalism permeates technology development. Bar codes were developed and placed in the public domain (Brown 1997; Dunlop 2001). This had the effect of making it easy for manufacturers to use them on labels and opened the door to dozens of different designs for readers; the only requirement for the reader was that it could accurately read the code. In contrast, RFID tags have been proprietary since their inception. Ironically, the very fact that they are proprietary has slowed their widespread use; no one has wanted to invest heavily in a technology that might be incompatible with other similar technologies. Indeed, just a few years ago, there was a widespread concern that RFID might have simply fizzled out (Schrage 2003). However, of late, it appears that RFID has picked up speed again, especially at the pre-final consumer stage, in part because the number of significant players has diminished and in part because the size and price of tags continues to decline.
Finally ICT have been essential to all this. ‘Information technology is the privileged technology of neoliberalism. It is far more useful for speculative activity and for maximising the number of short-term market contracts than for improving production’ (Harvey 2005, p. 159). ICT permit the transformation of vast quantities of information into data, that is, bits of quantitative information that can be mathematically manipulated in ever more complex ways at great speed. Moreover, this can be done, even while keeping track of information about individuals – be they humans, containers, base pairs, monetary values or nanodevices attached to various things.
Genetics and genomics, nanotechnologies, container technologies and even global financial transactions would create massive and probably unmanageable streams of paper records were it not for ICT. Moreover, ICT allow the separation of data collection from data analysis, both physically and conceptually in this way.
Firstly, the data collected need not be analysed at the collection site; this can be done centrally in a manner that allows for market calculations, cost–benefit comparisons, and a more rapid turnover of product. Hence, Burger King can collect data about sales at all its stores and analyse them at headquarters, determining how many workers, burgers and stores should be available at what hours so as to maximise sales (Reiter 1991). Wal-Mart can manage its vast inventory centrally and even automatically place orders with its huge range of suppliers as inventories decline. A fruit grower or vineyard manager can sit in an air-conditioned office far from the field and determine when the temperature is too low or insect populations are too high, following that by corrective action. A financier can sit in an office far removed from places where bulk commodities are grown, mined, refined or processed and establish automated algorithms to buy and sell financial instruments. And data can be collected from hundreds of molecular biology laboratories into massive databases analysed by computational biologists (see Waterman 2000). Astonishingly enough, computational biologists can sit behind computer screens running complex programs to locate various homologies and never come into contact with any biological entity.
Secondly, the very process of data analysis has changed in two quite distinct ways. On the one hand, the scale, speed and cost of doing analyses has shifted. A certain Richard J. Foote (1958) of the Agricultural Marketing Service of the United States Department of Agriculture issued a bulletin in 1958 that explained how to perform a multiple regression analysis. The technique required a roomful of statistical clerks with electrical desk calculators. Clearly, under these circumstances only the very largest government offices or companies could afford to engage in this type of analysis. Moreover, it was laboriously slow, requiring checking at each stage of the analysis, especially with respect to the calculation of the determinant of the matrix and the correct placement of the decimal point. Today, of course, the same analysis can be performed instantaneously on a desktop computer, and probably with greater accuracy.
On the other hand, the nature of the analyses performed has changed. Half a century ago statisticians were mainly concerned with identifying measures of central tendency. This was associated with hypothesis testing on small samples. With the exception of a handful of highly technical and mathematical fields such as particle physics,14 and the work of actuaries employed by the insurance industry (Porter 1995), where profitability was directly tied to the robustness of particular individuals (people or things) in the pool, the high cost simply ruled out any other sort of analysis. In contrast, today data mining is the rule. This means tracking each data point, examining and acting on trends for as long as they hold, and engaging in ever more sophisticated error analysis (Taylor 1997).
A word of warning is necessary here, lest my argument be misinterpreted. What I am arguing is not that neoliberals or neoliberalism somehow caused these techno-scientific changes. Instead, changes in genetics and genomics, nanotechnologies, transportation and ICT have been fostered through public and private funding. However, to a considerable extent they have been shaped by, and have, in turn, shaped and supported the enactment of the neoliberal project.
Even the very practice of doing science has changed. Intellectual property has permeated much of biology, chemistry and physics. In the food and agricultural sciences ‘materials transfer agreements’ are now commonplace. Much sophisticated instrumentation is leased in which the lessor makes a claim on research results. Intellectual property lawyers comb through research findings at public research institutions looking for patentable products and processes.
Secondly, the private sector has taken the lead in setting much of the research agenda. In the UK most of the public agricultural research system was dismantled, leaving the nation vulnerable to new pests and diseases. In the USA, the European Union and much of the rest of the world, much of the research performed at agricultural experiment stations is now useful to farmers only if it passes through the hands of chemical and seed companies (Wolf and Zilberman 2001). Furthermore, the Consultative Group for International Agricultural Research plays a minor role in world agriculture and has a budget that is dwarfed by that of the chemical and seed companies.
Finally, scientific reward systems have been transformed. It is no accident that the Science Citation Index (SCI), initially developed for use in locating bibliographic references, has become a means for evaluating scientific performance in many academic settings. The use of the SCI permits – although clearly in a highly flawed manner – the creation of market-like competition among academics, universities and even nations. Arguably, a different political-economic project would have spurred different emphases in developments in techno-science, perhaps with greater concern for ecological approaches to biology, for management-intensive approaches to crop yield improvement and pest management, for a more even distribution of container ports around the world, with the interface for RFID devices and readers in the public domain, with free movement of scientific instruments, methods and materials, with more limited intellectual property rights and with less concern with detailed control of people and things.
However, I do not want to fall into the structuralist trap. There is not one neoliberalism any more than there is one capitalism (Boyer 1996). The neoliberal project has been enacted differently in different places. Norwegian neoliberalism is not the same as British neoliberalism, which is not the same as US neoliberalism. There are several reasons for this. Most obviously, despite the creation of global institutions like the WTO, there is no theatre, no central location from which the neoliberal drama is directed. Hence, committed neoliberals may and do enact neoliberalism differently in different places. Indeed, Foucault (2008) distinguished at least two versions of neoliberalism: a German Ordoliberal school and a US one. Moreover, situations vary considerably from place to place. If Bismarck were right in arguing that ‘politics is the art of the possible’, then clearly certain things are possible in some places and not in others. Hence, the neoliberal landscape of today is a chequered one. Even as neoliberals agree that the state should foster markets and quasi-markets while destroying collective forms of action they disagree as to how to do so and what form these markets should take, and which collective forms should be dismantled. Like Richard Posner (1987), they are not potted plants.
But it is important not to end here. As neoliberalism has become a dominant taken-for-granted set of practices, it has also fostered resistances of various sorts. In the agrifood sector these forms of resistance have been varied. On the one hand they have included proponents of farmers' markets, box schemes, community supported agriculture, organic agriculture, fair trade, Slow Food and so on. On the other hand, they have included various general farm and commodity groups that have attempted with declining success to maintain agricultural exceptionalism in world trade.
Furthermore, resistance has varied considerably, as a result of different histories, different forms that neoliberalism takes in different places and different strategies of resistance employed. Opponents of neoliberalism in the nations of the former Soviet bloc employ different strategies than do opponents in Brazil or India. Opponents of neoliberalism in Britain share some concerns with their French counterparts but they also have many differences. For example, organic agriculture has taken off in both nations but while an active peasants' union (the Confédération Paysanne) makes headlines in France, occasionally actively attacking fast food restaurants, no equivalent exists in Britain. In the USA mainstream farmer organisations have seen their impact decline, in no small part because their numbers continue to diminish, but also because the large grain traders, food processors and retailers now operate globally and see their freedom to operate blocked by most protectionist agricultural policies.
That said, I believe that there have been slow but perceptible shifts from petitioning the state for legal redress – a reasonable tactic in a liberal capitalist world – towards petitioning the private sector and in the nature of NGOs themselves. Consider the shift from the state to the private sector. This is hardly a surprise since the neoliberal state is far less likely to respond to popular protest than the previous liberal one and growing concentration – especially in the retail sector – has actually increased its vulnerability. An example described by Julie Guthman (2008) is instructive: The alternatives developed in a California project for a sustainable and just food system tended to employ largely neoliberal categories. Petitioning the state for legal redress was not merely absent from the discourse; it was beyond the imaginable for the participants. Instead, stakeholder involvement, audits, best practice and opportunities-based approaches were proposed. As she put it,
NGO advocates and other invited ‘stakeholders’ played a constitutive role in producing the neoliberal outcomes of the project, in part because their input reflected already-developed notions of the possible within the current climate of neoliberalism. (p. 1242)
Funders proved to be as concerned about developing measurable indicators of success as the advocates of neoliberalism. Similarly, Brown and Getz (2008) note how justice for farm workers has shifted from redress by the state to voluntary certification. Finally, Miele (2008) notes how even the Slow Food movement has begun to certify cities as ‘Città Slow.’
Secondly, as Putnam (1995) and others have observed, there has been a shift from membership organisations in which active participation is an essential part of membership – think of farm workers' unions and the US civil rights movement as examples – towards organisations where participation for most people consists in donating money every so often. While some alternatives, such as community supported agriculture and farmers markets, clearly involve regular participation in the activities of the organisation, others such as fair trade and organic agriculture require of most participants only nominal participation, usually in the form of seeking out logos of one sort or another before purchasing food items. This individuation, as the late Pierre Bourdieu (1998) observed, is part and parcel of the neoliberal insistence not merely on methodological individualism but that all solidarities must be eliminated by their transformation into market exchanges.
This is not to suggest that the use of any means acceptable to neoliberals should be by definition unacceptable to their opponents. Nor is it to suggest that such means cannot be put to use in fighting for what Hayek (1976) called ‘the mirage of social justice’. However, those of us who reject many of the premises of neoliberalism should not – at the very same time – allow neoliberal practice to stifle our imaginations.
In writing the abstract for this article, I noted that fairy tales often have surprise endings. The surprise ending – perhaps only to committed neoliberals – is that the neoliberal fear of the state has come back to haunt us. Despite the rhetoric of deregulation, of a neoliberal ‘withering away of the state’, the state has actually grown in scope. Of course, it has grown as the proponents of neoliberalism had expected, that is, in that the state now regularly produces legal and regulatory frameworks as well as bureaucratic structures that support and induce the creation of markets. But it has also grown in several other ways that were completely unexpected by neoliberals.
Firstly, the rapid growth of the TSR, as noted above, can only be understood as new forms of governance. And, despite the formal separation of the standards, certification and accreditation from the state, they can exist only as long as the state – in the form of contract, property and criminal law – backs them up. Put differently, the TSR is a new and ubiquitous form of governance that, although supported by the state, is fundamentally responsible only to itself and not to any democratically elected legislative body. Hence, while it can do good, it can just as easily do harm, with little or no democratic oversight.
Secondly, the technologies of neoliberalism are also new forms of governance. For all practical purposes, goods must now be made of appropriate size and sufficient volume to fit into shipping containers (think of Ikea); those who are unfortunate enough to live too far from a large container port or the infrastructure that leads to it – most of the residents of sub-Saharan Africa, for example – will find that everything imported is quite expensive and they have nothing to export. We have all experienced the problems caused when the categories embedded in ICT do not fit our particular case. Much of this is part and parcel of the public and private collection of vast quantities of usually unverifiable data about each of us. Similarly, genetics and genomics promises us detailed self-knowledge, but this is likely to be at the price of (either accidental or deliberate) disclosure of extremely personal information to public and private entities. Finally, nanotechnologies promise a world of ambient intelligence (Aarts and Ruyter 2009), a world in which things are made animate, to respond to our desires. But this can only occur if our desires are written on our sleeves, as it were.
None of this is meant to suggest that either we should do away entirely with standards and audits or that the technologies of neoliberal governance are inherently problematic. It is to say that, in our collective quest to escape the state, we are finding that its seeming antithesis is the state itself. Moreover, instead of a democratic state, it is a corporate and bureaucratic state that – often in the name of transparency – is increasingly opaque. In an unintentionally ironic move, Hayek (2007 , p. 60) may well have envisioned the problems of governance noted here when he wrote:
Is there a greater tragedy imaginable than that, in our endeavour consciously to shape our future in accordance with high ideals, we should in fact unwittingly produce the very opposite of what we have been striving for?
Of course, the end of the story of neoliberalism and world agriculture has yet to be written. That said, I can confidently tell you what it will not be: we will not look back 50 years from now and marvel at how the neoliberal approach to governance was an unqualified success. The recent and continuing financial crisis has already revealed some of neoliberalism's major weaknesses. But, more speculatively, I think that neoliberalism will be subsumed by a perfect storm composed of climate change, rising energy costs, biodiversity decline, environmental degradation due to profligate use of water and soils and the quest for sustainability.
Already, a number of projects are underway or have been recently completed to revision the food and agriculture sector (for example, Chatham House 2008; Chaumet et al. 2009; International assessment of agricultural knowledge, science and technology for development 2008). Moreover, the demands placed on public agricultural research are more and more contradictory (Busch 2009). A major shift is likely to be in the offing, although it may require a major crisis – a water shortage, a crop failure, a major food safety failure, an insect or disease plague – to spur people to action. In the meantime, we academics have a job to do: to conceive of alternative democratic futures and the means by which they might be reached. As an unsuccessful candidate for the US presidency, Alfred E. Smith (1933, p. 16), asserted nearly a century ago, ‘All the ills of democracy can be cured by more democracy’. Perhaps an overstatement, but an overstatement that seems worth pursuing.
Lippmann's work received a blistering critique from John Dewey (1987 ) who noted that the word ‘profit’ was completely absent from a lengthy work on capitalism.
Friedman conveniently forgot that Crusoe arrived on his island fully socialised and that he quickly acquired his man Friday, who was a convenient source of local knowledge.
This was one place where neoliberals and neoclassical economists agreed fully. For both, trade barriers introduced inefficiencies to the marketplace. The theory of comparative advantage suggested that elimination of trade barriers would greatly increase the benefits to all (cf. Ormerod 1994).
Economists often distinguish between organisations and institutions (sets of rules). While this distinction can be useful, it is somewhat undermined by the rise of governance institutions that are simultaneously organisations and rule-setting agencies. See, for example, Vatn (2006).
Kay and Ackrill (2009) note that the process has been an iterative one, in which imprecise rules allow initial agreement and are then made more precise by further negotiations as well as through decisions taken under the dispute settlement process.
Williamson (2004–2005) argues that the so-called Washington Consensus actually included more funding for primary education and health care rather than less.
Ahold operates under a wide range of names (for example, Albert Hein, Giant, Tops) and as such is not well-known to consumers.
At the limit, supermarkets can lock in their suppliers to ‘private label’ (also known as store brand) products. Such products, sold under the supermarket's own label, combine the advantages of standards with the fact that the product in question can only be purchased at a particular chain of stores. One UK supermarket chain, Marks & Spencer, takes this to its logical conclusion, selling only its own brand of products. However, so doing also increases the risk borne by the supermarket should a food safety scare occur; hence, most firms have been reluctant to go as far as Marks & Spencer.
It should be noted that the idea of personalised nutrition is misleading at best. Nutrition recommendations must be based on a statistical sample. While the sample may be divided into ever finer subgroups, one can never reach the point of personalisation since one must extrapolate from a sample to an individual.
The system of rice intensification (SRI) is a case in point. While vast sums have been spent on both identifying genes and agrichemicals that improve crop yields, cultural practices have been largely ignored. Indeed, it is commonplace for breeders to do their initial tests in sterilised soils so as to control for soil differences. However, the SRI, an empirically derived system for crop management has produced demonstrated yield increases of 50 per cent or more by manipulating water use and plant spacing. For details see, Cornell International Institute for Food Agriculture and Development (2009).
The recent bar coding of life project has attempted to revive taxonomy by employing the tools of molecular biology (Marshall 2005). However, it is of little value with respect to defining varieties of cultivated plants.
It is perfectly legal to test genetically modified crops to determine if they cause any environmental harm. However, even the implicit threat of legal action, and the significant costs the defendants are likely to incur, is sufficient to deter universities from allowing faculty to engage in this type of research.
The central role played by the US government and US-based firms is evidenced by the fact that containers employ English rather than metric measurements.
For a comparison of high energy physics and molecular biology, see Knorr Cetina (2003)