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The Politics of Food Aid

Food aid played a role, but perhaps was not the smoking gun it is often assumed to be. The impacts of food aid were at once less serious as a direct cause of the famine, and more so among the structural factors that made it inevitable. Food aid was vital to the Bangladesh economy, as it had been to that of East Pakistan, ensuring donors significant leverage over government. Since 1971, food aid disbursements (excluding loans) averaged USD 143

The value of food aid (USD millions)

Figure 5.2. The value of food aid (USD millions)

Source: Flow of external resources into Bangladesh 2012/13 (ERD 2014).

million per year (see Figure 5.2), declining steadily after the 1970s; recent figures totalled USD 50 million, chiefly earmarked for poverty-focused schemes.[1] Of the USD 60 billion of aid disbursed to Bangladesh to date, nearly USD 7 billion has been food (ERD 2014). US food aid provided one-third of food imports and 40 per cent of food aid well into the 1990s. Until 1987, food aid distributed under the US Public Law 480 (PL480) alone was the equivalent of 10 per cent of export earnings (USAID 1997).

In the 1950s, the key purpose of PL480 was to offload US grain surpluses and create markets for American foodgrains, a strategy that was so successful in food-insecure East Pakistan that it was credited with permanently changing Bengali food culture by introducing wheat bread. Remarkably, relieving hunger only became an objective of PL480 in the 1960s (Atwood et al. 2000). In a poor country like Bangladesh, the volume of food aid meant it became vital to the operations of the government—and therefore to maintaining the terms of the political settlement. Its importance in helping structure and reproduce the political economy dated to pre-independence times, when food aid was used to finance rural development programming under the Basic Democrats programme. From the 1960s, food aid became an important source of budget support, sold and used as government revenue (Atwood etal. 2000). This was possible because some 71 per cent of PL480 was in the form of programme food aid that could be sold on the open market to fill the government's coffers, rather than going direct to hungry people (USAID 1997).

Food aid was so extensive that it became an important subsidy to public sector wages (see Clay 1979), and is blamed for weak agricultural investment in the East Pakistan and early independence period (World Bank 1977; Franda 1981b; Ahmed, Haggblade, and Chowdhury 2000). In the first two years of independence, food aid was supplied mainly through humanitarian channels. But already by mid-1973, the government was having difficulties securing the commitments it needed. Food aid flows dropped in the crucial year of 1973/4 because of global commodity price rises, donor fatigue due to corruption and mismanagement, and the US withholding PL480 (Atwood etal. 2000). According to one insider, in mid-1973 the government requested 300,000 (later revised to 220,000) tons of food assistance from the US, 10 per cent of the estimated food gap of 2.2 million tons (Islam

2003). Even then, more than a year before the floods that triggered the 1974 famine, the government of Bangladesh appeared to have read the reluctance of the US correctly, as the request was repeated again that summer and again in early 1974.

World food prices were high at this time, and as its stocks dwindled, the Bangladesh government was forced to try commercial imports. But the government was in effect bankrupt, hit particularly hard by the global commodity price rises of 1973-4 and the need to pay hard currency for food imports it had hoped would be covered by aid. Two large grain contracts with US suppliers were cancelled because the government was considered insufficiently creditworthy (Rothschild 1976). Sobhan hints at collusion between the grain traders and US officials, aiming to 'bring Bangladesh to its knees' (1979, 1978).

Islam notes that the government of Bangladesh was still expecting US food aid when the US Ambassador dropped the bombshell in May 1974: because Bangladesh had agreed to sell Cuba jute sacks worth USD million, it could not have food aid under PL480, which bans trade with communist countries by recipients. Why the US government chose that moment to remember this rule, apparently ignored for other (more geopolitically important) countries like Egypt (Hossain 1999; Dowlah 2006), is not recorded. Islam recalls that even when the government of Bangladesh cancelled any future trade, the US government lawyers stalled, arguing that Bangladesh was technically still trading with Cuba. The jute sacks were shipped in October 1974, after which the food aid agreement was finally signed, a year after the initial request. 'This grim drama', recalls Sobhan, 'was being transacted in the capital city in the full view and knowledge of the US embassy as to the nature and gravity of the crisis' (1979, 1979).

Whether or not the timely shipment of PL480 would have made the difference is contentious, as it is not clear how much would have gone to the relief effort in any case (Islam 2003).[2] This is because food aid would have entered the Public Food Distribution System (PFDS), the official system for distributing subsidized or free foodgrains that had been in place in the region since 1943, and the PFDS had neither the mandate nor necessarily the administrative machinery with which to prioritize the needs of the rural landless poor. The organization of the PFDS will be discussed in more detail presently. But in order to assess the difference a more timely shipment of PL480 might have made, it is important to understand that in 1974 food aid would likely have been absorbed by the Modified Rationing channel reserved for rural populations. This was the channel that got what was left after the main beneficiaries under the Statutory Rationing channel (covering government servants and the main urban populations) had been served. Although directed to rural areas, Modified Rationing never targeted the landless rural poor effectively, and much of what they were supposed to get never reached them because of corruption (Chowdhury 1988; Chowdhury 1986). So it seems unlikely that more grains pouring into the Modified Rationing channel would have made a significant difference in alleviating the distress of the starving rural population. Sobhan's view that 'as far as it is possible [Modified Rationing] represents a conscious attempt to reach the poorest segment of the population' is either disingenuous or uninformed (1979,1975); after 1974, the government and its partners did find ways of reaching the poorest, and it was not through Modified Rationing. Nevertheless, Sobhan is correct in principle, because the timely arrival of PL480 food would have eased pressures on food prices, in particular by alleviating fears that the government was unable to intervene—fears that speculators exploited to good profit.

Why did the US government delay signing a food aid agreement, even when death by starvation was visible to US embassy officials? Sobhan seems clear that the Cuba-PL480 crisis was little more than an attempt to call Bangladesh to heel. The 'tilt' to Pakistan had endured in a generalized hostility to 'the Bengalees' which spilled over into food aid policy. US officials took the opportunity of a Washington DC visit by Finance Minister Tajuddin Ahmed to press for Bangladesh to stop war crimes proceedings against Pakistanis, presumably the quid pro quo for food aid, while Rothschild notes the US attempt to create a 'despairing chorus line' of food aid recipients to lobby OPEC to cut oil prices (1976, 295).

Sobhan is clear that food aid was being used as a weapon against a regime whose overall agenda the US government did not approve of:

Its decision to suspend PL-480 shipments to Bangladesh against pre-committed food aid on grounds of Bangladesh's miniscule exports of jute goods to Cuba should thus be seen not just as an attempt to constrain the regime's external relations, but as a direct assault on the viability of the regime. The political motivation underlying this embargo may be derived from the fact that at that time Kissinger sought a special dispensation for Sadat's Egypt to continue exporting cotton to Cuba while receiving US PL-480 commodity aid. Whether this assault on the stability of the Bangladesh regime, through creating a crisis in the local food market, was itself the prelude to the dislodgement in August 1975 of the post-liberation regime in Bangladesh remains open to fuller enquiry, though there is some circumstantial evidence to suggest that such might have been the premise to US economic policy towards Bangladesh in 1973-5.

(Sobhan 1991, 104)

Sobhan is no doubt correct that the US government treated food aid as a source of power over a disaster-ridden, war-torn, broke Bangladesh (see also McHenry and Bird 1977). But it may have been less the pursuit of hard-headed strategic interests than the lack of interest—the low priority of these events in far-off, unimportant Bangladesh—that stalled US food aid. US officials thought the teeming millions of a third world hotspot had 'a "power" to let millions of children starve on television'; an Assistant Secretary of State responsible for US food policy found it ' "hard to think of any real purpose when it comes to the Indian subcontinent"'(Rothschild 1976, 294). Declassified official cables suggest the US feared being embarrassed by their failure to help with famine relief. Negotiations around the Cuba issue went on in secret, because both sides wanted it that way. But once noticed, the regulations regarding Cuba could not be un-noticed; lawyerly attention to detail in Washington DC somehow took precedence over humanitarian disaster in Dhaka, partly because PL480 was law and not policy. It would have taken an executive order or legal amendment for USAID to have permitted the signing of the agreement. All of this suggests that the diagnosis of a bureaucratic 'bungle' is close to the mark (McHenry and Bird 1977).

Part of the story, then, appears to be Bangladesh's low priority in the geopolitical order. An executive order had been forthcoming to permit Egypt, whose people were not starving, to continue to receive PL480, but not Bangladesh, whose people were. A likely motivation for such discrimination is that an ideology of 'triage'—in brief, that resources should be concentrated on those likely to survive rather than those destined not to—was at work in the minds of at least some US policy types. Triage theory, or 'lifeboat ethics' in Garrett Hardin's formulation (1974), was popularized by a book- length prediction that the world as we knew it would come to an effective end with mass worldwide famine in 1975 (Paddock and Paddock 1968). The Paddocks' Famine1975! now reads as a faintly amusing anachronism. This breathless account of the impending world food crisis is almost parodic in its Malthusian descriptions of copulating brown masses being fed by idealistic, misguided Peace Corps-types. And yet triage theory and lifeboats were deadly serious ideologies (Singer 1972). And the Paddock brothers were in key respects accurate when it came to Bangladesh, where 2 per cent of the population was lost to famine in 1974-5. The extent to which triage theory helped make its predictions come true is not known, but it was among the ideological baggage with which the US government addressed the Bangladesh famine (Rothschild 1976; Tweeten 2001).

The politics of food aid in 1974 may in fact not be that the US pursued important political objectives, but something more insidious, because the only interest served was ideological. At least some of its officials appear to have been inclined to let mass starvation occur because they were possessed of an ideology that told them that Bangladesh anyway had more people than it could do with, and here was as good a laboratory as any in which to see what might happen if the US did not act.

  • [1] Author's calculations from Economic Relations Division data (ERD 2014).
  • [2] Dowlah argues that it would not have mattered, but as he refers to an amount of 20,000 ratherthan 200,000 tons, it seems he underestimates the quantitative significance of the shortfall(Dowlah 2006).
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