This article is continuing: “Biotechnology’s Promise”

Food has become a casualty of biotechnology’s promise because the agricultural sector offers pharmaceutical conglomerates unique opportunities to pursue the development and
monopolization of proprietary biotechnology platforms while reducing their financial risks. The enormous public resources invested in agriculture have benefited these companies by promoting the sale of GE seeds over and above their actual value and by allowing them to multiply their research efforts at minimal cost through collaborations with public institutions.
Over the course of the last century, farming has become increasingly capital intensive. Discreteelements of the agricultural production process have continually been displaced from farm fields, deconstructed in laboratories, reconstructed in manufacturing facilities, and reincorporated back into agriculture as purchased inputs. Resources that were formerly sourced and supplied by the farm have been replaced by industrial equivalents.
These changes in the structure and operation of American farms did not occur entirely of their own accord. Rather, they are the consequence of government policies that have promoted capital accumulation in the agricultural sector. In 2000, nearly 50 percent of U.S. farms received payments for income or price support. These payments, comprising almost one-half of net farm income, reached a historic high of $20 billion that year. Most of the payments farmers receive from the government are compensation for the difference between their high costs of production and the low market price. For example,
in 2000 it cost farmers an average of $2.72 to grow a bushel of corn, while the market price was only $1.77. Government payments largely covered the difference, helping to maintain farm solvency in the face of massive overproduction and rock bottom prices. As a result, farmers continue to push their yields, increasing both the absolute volume of inputs and the technological sophistication of those inputs, knowing that the expenses they incur will be covered by the generosity of Uncle Sam. That is, government support for commodity prices ultimately translates into government support for industrial inputs.
Industry sales are then further reinforced by tax policies: tax credits, accelerated depreciation, the special treatment of capital gains, all of which stimulate investment in agriculture by lowering the cost of capital. These policies are then complemented by government-backed financial institutions such as the Farm Credit System and the Farmers Home Administration that lend to farmers at highly subsidized interest rates, thereby encouraging excessive capital investment for operating inputs. The bottom line is that industry has the government to thank for its sales. Government supported commodity prices, tax breaks on capital goods, and cheap credit translate into greater demand for manufactured inputs. These interventions have made it possible for agribusiness to sell products to farmers that actually increase their losses. (If it costs $2.72 to raise a bushel
of corn for which you receive $1.77, the more you produce the more you lose). But so long as taxpayer funds can be used to foot the bill for these technologies and purchase the excess they generate at premium prices, farmers will continue to demand them.
Unfortunately, farmers are not the primary beneficiaries of federal largesse. For as Jeanne- Pierre Berlan calls to our attention, the “idea upon which modern agricultural policies were founded never intended to defend the family farm but to foster capital accumulation in the emerging agribusiness complex increasingly dominated by large corporations.”43 Farm receipts as a percentage of total farm household income continue to fall and most farmers are forced to find off-farm work to make ends meet. The fact of
the matter is, the money we fork over as taxpayers eventually ends up in the pockets of agribusiness (strangely enough agribusiness now includes the pharmaceutical industry). It is with this in mind that we should evaluate the success of GE seeds, an invention whose adoption is largely attributable to government subsidies.

Priming the Biotech Pipeline

The government essentially promotes the sale of GE seeds; that is, so to speak, the demand side of the equation. On the supply side, universities and public research institutions enter into the analysis. The Harvard zoologist Richard Lewontin sums it up best when he notes:

“the costs of long-range research are socialized by changing the locus of the work from individual enterprises [i.e. pharmaceutical companies] to public institutions such as universities and national institutes. In this way, by tax subsidization, no individual firm need risk an investment and the total costs are spread over the entire tax base. [Then, when] such socialized research comes close to producing a marketable product, the final
development stages are taken back into private hands to realize an exclusive property.”
Through their collaborations with public research institutions, the biotechnology industry has managed to reorient science, affecting what questions will be asked, which problems will be investigated, what solutions will be sought, and what conclusions will be drawn. As research funding from federal and state sources continues to stagnate while universities seek to expand their research facilities, they have progressively become more and more willing to entertain the designs of industry.
At State Agricultural Experiment Stations and Land-Grant Universities, the “lure of large
sums of private money for biotechnology research have led to a change in disciplines,” as staff conducting agricultural biotechnology research have increased substantially at the expense of conventional breeding programs. Through monetary enticements, private firms have managed to leverage their relatively minor financial contributions throughout the university or institute, thereby capturing within their orbit human and laboratory resources that are primarily sustained through public funding. A strategy reinforced by tax deductions: in California, the center of the biotechnology industry in the United States
and home to the expansive and well-endowed University of California educational system,there is a 24 percent tax credit for business investments in university research.
Federal legislation encouraging publicprivate partnerships and the patenting of university
generated knowledge also serves to discipline public research to the pursuit of private profits. In 1974, prompted by Stanford University’s petition to patent the Cohen-Boyer recombinant DNA process, the National Institutes of Health decided to allow “universities to patent and license in the field of genetic engineering” greatly simplifying “the privatization of university research by removing any claims on behalf of the public regarding ownership of government-funded research.” Most large research universities now have Offices of Technology Transfer (OTT) to facilitate cooperation between corporations and university researchers. A development encouraged by the 1980 Bayh-Dole Act which officially made it legal for public universities to patent inventions, established frameworks to facilitate technology transfer from the public to the private sector, and made it possible for universities to go into business for themselves. Since then, universities have formed hundreds of startup companies “based on technology they developed and licensed” – companies wherein faculty members frequently sit on the board serving as “advisers, recruiters of trained personnel, and information sources on current developments in academic science”. A development which offers these companies a foothold in the academy and assures that university research will be commercialized on industry’s terms.

Extracted from “How Food Became a Casualty of Biotechnology’s Promise“, by By Michael Heimbinder, Fellow, Oakland Institute.

This article continues in: “Normalizing Biotechnology“

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