AGALERT DOESN’T APOLOGISE for concentrating so much on the Wilmar dispute, even for all those farmers who don’t grow sugar cane.
That’s because it goes to the heart of modern farming and current business practices.
It’s a very 21st century issue much at the heart of current frustration with the political and business system by the mass of populations in western democracies around the world.
Politics and business is not regarded as being about ‘what’s fair’ and ‘what’s good for as many as possible in our populations and for our country’.
It’s about who can aggressively win the most.
A recent stockbroker report praised a number of companies as terrific investments because they cornered a monopoly which gave them pricing power over customers, and buying power to screw suppliers as employees. That’s what CEOs earn the very big bucks for. To put their conscience in a box and grab monopoly, and screw away at everyone’s they deal with — all, of course, behind the nice politically correct mission statements about serving customers, suppliers, employees, etc, etc.
CSR was a tough, paternalistic, authoritarian sugar miller for a century, but they took the big bucks from Wilmar — $1.7 billion or about half a billion more than they were expecting for their ageing sugar mills, because they recognised they weren’t tough enough to break the sugar industry system they helped build-up that delivered a $100 million a year cash profit. They took the big bucks (to go into a glass venture which loses their shareholders about half their windfall) because they recognised someone else had to have the bigger cohones to break the system for a bigger profit.
And that’s so often the case when a big corporate makes a big and highly priced take-over.
And governments and their regulators generally just stand aside, offering a few occasional stern words and a few ‘beat me with a feather’ conditions — with little regard for the consequences on local suppliers (farmers), local communities or the tax revenues of state and federal governments.
Often, there is little extra real efficiency delivered. Either the processing is moved off-shore (car industry, much of the grocery manufacturing) or if stays local and the accountants screw down every cost, mainly by screwing every supplier. Look at the drop in reliability in sugar mills as locally-produced chains were replaced by ‘cheaper’ ones from, we believe, India.
Stage one — the initial industrial and material suppliers get screwed harder.
Stage two — the old machine gets pushed harder and harder for little extra real investment.
Stage three — the main product suppliers (cattle, cane, vegetables, etc) face new tougher regimes of supply and payments.
With stages one and two largely exhausted, and a fresh wave of regulators and political advisors who know no history of the structure of rural industries, have little care or connection with farmers, their contractors and local communities, and plenty of lobbying and long lunches — the big shakeup starts to shift revenue and profits from the rural sector to the (often) foreign-owned processors who, of course, have set up opaque off-shore marketing hubs in low tax zones.
The big name accountants, lawyers and lobbyists (and their political, city media and business association hangers-on) are in a fee earning splurge that drives-up the price of inner city executive houses and luxury car dealerships, while the real workers in country communities face loss of income, confusion, frustration and an unsettled lifestyle.
Some may say this is just the brutality of efficient capitalism — especially economists on the public payroll in government advisory or regulatory bodies or universities. Easy to say with a guaranteed fortnightly income and a defined benefit government-guaranteed pension.
But the general populace, few of whom have economics or political history degrees, can still sense the general unfairness of the situation. And that’s why the major political parties around the world, whose leaders are so self-obsessed with their ego boosts from the power brokers and money-makers, still don’t recognise the situation dawning on average, ordinary workers and farmers who vote.
The dilemma is that just switching your vote to a person who says things which does recognise the breakdown of fairness in society is just a short-term feel good — like an ice cream on just one hot day of summer.
To turn around 30 years of the unfairness strategy of big business and traditional politics requires ordinary army folk to fight for what’s right.
And that’s why the sugar fight is so instructive.
Some 1,300 of the 1,550 farmers who supply Wilmar have put their lives and livelihoods right on the line to stand-up for a principle. Not to be the richest or flashiest farmer, but to have a choice on how they market their cane, transparency in how it is priced and not to sign a contract that has monopolistic clauses that does not allow them to grow another crop and can impose new charges of any amount at any time without question.
It is an issue facing every farmer, except those very few who grow, process and market (generally at a farmers’ market, a local shop or to a limited online audience).
It is an issue worth fighting for.
It is an issue central to maintaining a fair, innovative, independent farming sector in Australia.