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How Walmart Dictates Almost Everything

The Tale of the Onion

by P. SAINATH

“My onions are big, aren’t they?” Chris Pawelski asked our group of visitors at his farm 60 miles from New York City. “Any idea why?”

Because of consumer demand, we wondered? Perhaps bigger bulbs caught the customer’s eye better? “Nope,” said Pawelski, a fourth-generation farmer whose family arrived from Poland in 1903 and has worked this land for over a century. “The size is set by the retail chain stores. They dictate almost everything.”

That “almost everything” includes prices. While the Walmarts, Shop Rites and other chain stores sell his kind of onions for $1.49 to $1.89 a pound, Pawelski himself gets no more than 17 cents. And that’s an improvement. Between 1983 and 2010, the average price he got stayed around 12 cents a pound.

“All our input costs rose,” he points out. “Fertiliser, pesticide, just about everything went up. Except the price we got.” Which was about $6 a 50-pound bag. Retail prices though, soared in the same period. Distances are not the cause. The same chains sell cheap imports from Peru and China, driving down prices. And have branches not far from this farm in Goshen, Orange County, New York state.

“Anyone does any cooking?” he asked. A few hesitant hands went up. Pawelski held up the onion. “They want this size because they know you won’t use more than half of one of these in cooking a meal. And you’ll throw away the other half. The more you waste, the more you’ll buy.” The stores know this. So wastage is a strategy, not a by-product.

“For yellow onions,” says Pawelski, “we either grade on a 2 inch or 2/ inch standard. There are exceptions, but those are the norms. The re-packers dictate to us the sizes, which are in turn dictated to them by the chains. S*** rolls downhill, as it were …. Three decades ago our size standard was 1/ths inch.” Small farmers don’t get to bargain with Walmart. A huge pile of rotting onions — those that didn’t meet chain store norms — sits besides his fields.

Qualifying as one

Pawelski’s qualifies as a “small farm.” Which, the United States Department of Agriculture (USDA) tells us, is one with a “gross cash farm income (GCFI) of less than $250,000” a year. Which makes 91 per cent of U.S. farms “small.” About 60 per cent have a GCFI of less than $10,000. Pawelski, his father and brother jointly plant about a hundred acres. Of these, they own 60 and rent 40.

It’s not just the chain stores, however, that work against this exuberant and proud small farmer. Floods, hail and Hurricane Irene, have all claimed a toll. In 2009, he suffered crop losses of $1,150,000 but received just $6,000 from crop insurance. Far less than the $10,000 he had shelled out as premium. The losses drove the farm, which rests on some of the most fertile “muck soil” in the country, into debt.

Issue of labour

The whole agrarian structure and policy — transformed in these past decades — works against small family farms. The Pawelskis lived well for years off the fine farm they built. Chris himself went to college and has a Master’s in Communication Studies. His great-grandfather arrived in the United States with five dollars in his pocket. The great grandson is over $320,000 in debt. The entire edifice of U.S. agriculture is geared towards serving the corporate sector, not small family farms.

His wife being an assistant librarian in the school system helps. “She works to support my farming habit.” His brother, too, lives off non-farm income. His parents collect social security. Last year, he spent $1,60,000 and earned $2,000,000 on his 50 acres in the farm. “On that $40,000, I pay taxes.” The leaves him little to re-invest. The farm is pocked with old barns, aging tractors and trucks flogged off by the army.

Normally, he has four seasonal farm workers. “Three have left this year and I’m down to one guy.” The lack of labour hits harder as small farms take on more land on rent hoping to achieve economies of scale.

It’s an all-immigrant labour force now. “In the 1950s, it was mostly African-Americans,” says Pawelski. “In the 1970s it was Puerto Ricans. Now it’s mostly Guatemalans.” Some of them could be illegal. Checking that out is not within the farmer’s purview, though. “We follow all the laws we have to.”

Pawelski is a battler who has taken his cause to Capitol Hill. “I go maybe three times a year,” he says. And he’s met maybe “20-30 Congressmen and 10-12 Senators,” building up some selling skills in the process. Perhaps the Master’s in Communication helped. But he’s hopelessly outgunned. Large corporations spend hundreds of millions of dollars on lobbying to ensure agriculture remains their captive. A lot of that gets spent when the “Farm Bill” comes up every five years.

AP investigation

An Associated Press (AP) investigation in 2001 showed where the (public) money goes. Even if structured differently since then, the grip of the corporate world and the very rich remains firm. As AP’s scrutiny of over 22 million USDA cheques showed: “63 per cent of the money went to the top 10 per cent of recipients…”

Among those struggling farmsteads receiving huge sums of money were “at least 20 Fortune 500 companies.” Also billionaires like David Rockefeller (with a farm in the same Hudson Valley where Pawelski lives). Others getting farm subsidies that year included media mogul Ted Turner and basketball star Scottie Pippen. And prison farms got a cut, too.

“All I want to do is make a living,” Pawelski testified before Congress during one of his forays there. “I’m not trying to be an Elmer Fudd-type millionaire (the grumpy character in the Looney Tunes/Bugs Bunny comics).” He’s in no danger of being Elmer Fudd, for sure. And his free spirit is much closer to that of Bugs. The question is whether the next generation on this century-old farm can make a living off it. You don’t want to know the answer.

P. SAINATH is the rural affairs editor of The Hindu, where this piece appears, and is the author of Everybody Loves a Good Drought. Sainath is presently in the US teaching for the (Fall) semester. He can be reached at: Sainath@princeton.edu.