We buy 95% of the food we eat in supermarkets. Four chains – Tesco,
Sainsbury’s, Asda and Morrison (now amalgamating Safeway) are
responsible for two thirds of all supermarket sales. Tesco alone, the
market leader, gets 30% of all food sales. Supermarkets are central to
the way food production is organised under modern capitalism.
So what? Aren’t they competing with each other for market share? Isn’t
the best way for a firm to compete and bump up sales to mark down
prices? Don’t people shop in these places because they’re cheaper? So
this is a sector where capitalism works!
We are going to argue that the competition between supermarket chains
is based on a systematic ratcheting down of standards across the board.
Prices are driven down by reducing production costs. And that
inevitably means:
- forcing down the standards of living of the workers and small farmers who produce the food they sell,
- wrecking the environment,
- destroying communities and, all too often, poisoning the consumers.
Capitalist economists like competition. They say it brings out the
best in the system. And the big supermarket chains are competing
against each other. Every time I walk round my local (which is
Sainsbury’s), signs constantly remind me of what the Tesco price for
the equivalent product is. But this competition between supermarket
chains is based on a collective monopoly they have over the suppliers.
Because they sell such a big proportion of the food we eat, they have
the whip hand over the suppliers. Economists call this buying power
monopsony power.Screwing the farmers
Much of the food sold in supermarkets comes, of course, from farmers.
Farmers, to many workers, are seen as dependent on handouts from Europe
who gave us mad cow disease. Cows are by nature vegetarian creatures,
as a quick trip to a field near you will establish. Farmers fed cows
with the remains of dead sheep in order to bump up their protein intake
and get them to produce more milk. In doing so they passed the sheep
disease scrapie to cows, and it then jumped the species barrier to
infect humans. So people died horribly as their brains, in effect,
turned to sponge. All to save a little money!
Actually the story’s a bit more complicated than that. Farming is a
capitalist industry. It is dominated by big farmers, such as the
‘barley barons’ of East Anglia. They behave exactly like any other
capitalist. But there are a lot of small farmers out there as well.
They are struggling. For years it has cost dairy farmers 21p to produce
a litre of milk. But the supermarkets demand they sell it to them for
18p. ‘Take it or leave it’ is the message. The alternative for the
farmer, given the stranglehold supermarkets hold over supply to the
consumers, is to get 0p for the milk – to pour it away. A bigger farmer
is more able to diversify – to offset any supermarket sales by seeking
out alternative outlets for their produce.
Shafting the workers
Other suppliers feel the pinch
in the same way. In the first week of September it was announced that
Northern Foods in Old Trafford is to close its gates with the loss of
600 jobs. They make pies and quiches, two thirds of which goes to the
supermarkets. Relentless pressure to cut prices from their principal
buyer Tesco is to blame for the closure. One small food outlet a week
goes to the wall through this process. And Northern Foods, with 600
workers, is small fry up against Tesco.
Stuffing the small firms
Those that survive are
fleeced shamelessly by the big boys. They actually have to pay the
supermarkets to get their stuff displayed. What is most sinister is
that this bullying is kept secret. Small firms dare not talk about it
to journalists and researchers for fear of losing their outlets. For a
larger branded product, this is not a problem. The supermarket would
get a lot of stick from customers if it didn’t stock Heinz Baked Beans,
for instance.
In this murky world, the supermarkets are accused of other dubious
practices. For instance, they may be approached by a small capitalist
with a good product idea. Then they’ll copy the product and launch it
nationally as an own label brand. Patrick Holden of the Soil
Association (the outfit that verifies organic status) says, “A
significant number of small organic businesses have suffered from
supermarkets switching suppliers or abandoning a brand in favour of own
label production. There is a tyranny about own label products that
allows supermarkets to abuse small producers.”
Tesco also holds reverse auctions, where the lowest charging supplier
wins. Marxists believe that there is a tendency for capital to
concentrate in bigger and bigger units. This is because of economies of
scale, the ability of bigger firms to produce cheaper than small ones.
But the rise of the supermarkets to dominance is not the result of
competing with small shops on a level playing field. Supermarkets can
insist on discounts that producers will not give to independent shops.
Inevitably this pressure on small capitalists causes them to crack down
on their workers. The tragedy of the Chinese cockle pickers drowned at
Morecambe Bay shows that the gangmaster system is still alive and well.
‘Illegal’ migrant workers criminalized by our immigration laws live
thirty to a house, are bussed out to work at the crack of dawn and have
their pathetic wages subjected to arbitrary deductions. All this is
happening now to the ‘strawberry slaves’ employed by S & A in
Herefordshire who the Transport and General Workers Union are trying to
organise. S & A’s main customers are Tesco and Sainsbury’s. This is
all stuff Marx and Engels wrote about over a century ago. It still goes
on, and the supermarkets are ringmasters of the whole show.
Poisoning us
Food is subject to the same cost cutting – and that’s a threat to our health. Felicity Lawrence points out in her book Not on the label
(Penguin Books, 2004) that, “Chicken, like other animals, have become
industrialised and globalised.” Not only do we not know where our food
comes from. The poor old humble chicken is part of a global division of
labour. She explains how the body parts are shipped out all over the
world, for instance gizzards to Russia and chicken feet to China. But
there was one part they did not know how to sell – the skin. So they
invented the chicken nugget as a way of selling disguised skin together
with mechanically recovered meat. Yum! In case vegetarians are feeling
smug at this point, they should read the next chapter of this truly
scary book – on salads. Bagged salad leaves are washed in chlorine, the
stuff they use in swimming pools. Lawrence comments, “Some chlorinated
compounds are known to be cancer-causing, but there appears to be
little research on foods treated with high doses of chlorine, the
process having evolved in an ad hoc way.” So the real problem is
capitalism, not what we choose to eat.Chicken nuggets are not very good
for you. But they are an easy food for harassed parents to serve up to
their kids. It is easy to sneer at these parents, but it really isn’t
their fault. It’s not so easy to pick up a packet of processed food in
a supermarket and work out exactly what’s in it. Their kids are
much more likely to be obese than they were twenty years ago. Eating
junk food is a big part of the reason. Is it too outrageous to suggest
that it ought to be illegal to sell food that poisons our kids? Health
Secretary Patricia Hewitt says, “There’s only so much governments can
do…People need to want to change their lifestyles and take
responsibility for their health.” This government is so in thrall to
business interests that it’s not even prepared to support a ban on junk
food adverts targeted at kids. Some of us would like Hewitt to ‘take
responsibility’ for being Health Minister and advocate an advertising
ban on junk food aimed at children as a first step.
Spoiling the environment
Supermarkets
also play their part in mucking up the environment. Cost cutting means
intensive farming. That in turn means the excessive use of pesticides.
These kill the insects that skylarks eat. That’s why you’re less likely
to hear skylarks these days. Pesticides could also be poisoning us as
rainwater runs off the fields into the streams and into our water
supply. In a previous article –Capitalism and the Environment
– we dealt with overfishing, pointing out it was a result of the
relentless pressure to come up with more and more cheap fish on the
supermarket shelves.As we know (seeCapitalism and the Environment)
the main challenge facing human beings on the planet earth is global
warming. This is caused by the emission of greenhouse gases such as
carbon dioxide. This may lead to climate change, causing large parts of
the earth’s surface to become uninhabitable. And supermarkets are a
major contributor to carbon emissions. Enter the shop and you are
confronted with a picture of permanent summer, with green beans flown
all the year round from Kenya for instance. There are beans in Tesco
with more air miles than the Secretary General of the United Nations!
Recent estimates by scientists have suggested that temperatures may
rise by as much as 6 degrees celsius by the end of the century. That
could lead to the biggest load of mass extinctions since the dinosaurs
died out. The problem is that life forms are dependent on each other in
an ecosystem. For example, insects live on plants and are eaten by
birds. Let Dr. Tim Sparks of the Centre for Ecology and Hydrology
explain. “One of the biggest problems is that species don’t adapt to
warming at the same rate. So if you have a bird that feeds on an insect
that relies on a certain plant for food, and any one of these responds
differently to warming differently to the others, the whole system can
break down.” Can the plant flee southward or northward as fast as the
insects and birds? If not, they’re all doomed.
It has been estimated that to get a kilo of apples from New Zealand
generates a kilo of CO2, all of which contributes to global warming.
And for every calorie we get from an iceberg lettuce flown out from Los
Angeles, 127 calories are burned up in fuel. To get an idea of the
damage air transport does, recall the story of Barbara Haddrill Invited
to a friend’s wedding in Australia, she decided to go by sea and land
and not to fly. She worked out that the flight would use up enough
energy per passenger to heat five homes for a whole year. This was a
principled decision by Barbara, but it’s not always an option for
people. What is needed is a complete change in the priorities imposed
by capitalism.
This is not an argument against an international division of labour.
Clearly if we were confined to British produce we would never have a
cup of tea or coffee. But when we read that we in Britain export milk
to Holland and they export milk to us we have to ask, what the hell is
going on?
Excessive airfreighting of food is not the only way supermarkets pile
up the carbon emissions. They all have a centralised system of national
distribution based on a handful of huge just-in-time distribution
bases. So orders placed from just 110 desks act as gatekeepers between
3.2 million farmers and 250 million consumers. Often this means goods
being shipped from one end of the country and then being shipped back
again. It also means, of course, that it won’t be as fresh as if it
came from down the road. Imagine how, in a planned economy, those links
would allow consumers to inform producers of what they want
collectively and ensure that their wants were met. Under capitalism
those links just give enormous power to the supermarket chains.
Diversity is a good thing in itself. We have hundreds of different
species of strawberry and literally thousands of different kinds of
apple in this country alone. Yet the only strawberry type you’ll find
in a supermarket is the elsanta. Why? Because it’s tastier? Er, no.
Because it’s a survivor. It can travel for hundreds of miles in the
back of a lorry and sit in a carton under artificial light in a
supermarket for over a week before being sold. It’s all about profits.
Supermarkets insist on displaying only ‘perfect’ fruit and vegetables
on their shelves (such as bright red apples that taste of nothing).
This obviously means that tasty but knobbly and misshapen fruit and
vegetables are wasted on the grand scale. The supermarkets don’t worry
about this. They won’t buy the stuff from the farmer, so it’s them that
bear the cost. As counterpart to this, they also waste resources
through unnecessary packaging. Nature provides every cucumber with a
perfectly acceptable protection and wrapping called the skin. So why
does every supermarket bought cucumber have to be encased in plastic?
Even mainstream newspaper articles have ridiculed the notion of
covering coconuts with a wrapper. At this point the reader may be
thinking to themselves, “Blimey, capitalism produces starvation and
war, and this bloke is going on about the plastic on cucumbers.” Fair
point, but it’s just a small example of the waste of resources of the
capitalist mindset.
Destroying local communities
Workers – consumers’
health – the environment – the other victims of supermarket power are
local communities. The growth of out-of town supermarkets has led to
what the New Economics Foundation calls ‘ghost town Britain’. Here
again dirty tricks are part of the story. Tesco has proved particularly
adept at manipulating the planning system. Whenever a superstore is
opened up the local paper will uncritically publish a press release.
High street independent shops can’t compete on price with out-of town
supermarkets and town centres go into decline. They become run-down,
yob-ridden places. Poor people are less likely to own cars, so they end
up paying more for basic foodstuffs in the town centre shops that
aren’t boarded up.
The big one – Wal-Mart
Asda is actually owned by
Wal-Mart, which is, by some criteria, the biggest company in the world.
Wal-Mart employs nearly two million workers worldwide. In 2005 it made
$300 billion in sales from 6,600 stores around the globe. Bob Ortega
comments (in his book ‘In Sam we trust’- Wal-Mart was founded by Sam
Walton), “Wal-Mart’s executives have demonstrated an often breathtaking
contempt for laws and regulations. In the US, courts again and again
have found the company to have lied, to have illegally falsified,
destroyed and withheld documents, to have committed civil fraud, to
have wilfully sold counterfeit goods, to have deliberately
discriminated against disabled job applicants, to have illegally fired
workers for interracial dating, to have discriminated against black and
Mexican employees in other ways, to have allowed managers to sexually
harass women workers – and to have fired women who had the temerity to
complain.” You get the idea. That’s how Wal-Mart got where it is
today.Thomas Friedman has a different take on Wal-Mart. He is one of
the foremost ideologists of ‘globalisation’, the view that capitalism
is all-powerful and benign, and resistance to it is useless. In his
book ‘The world is flat’ he looks saucer-eyed at their distribution
centre in Bentonville, Arkansas and rhapsodises, “Call it ‘the Wal-Mart
symphony in multiple movements’ – with no finale.” And goes on to
comment, “Its role as one of the ten forces that flattened”
(globalised) “ the world is undeniable.”
The reader may find this rant one-sided. Haven’t we all seen those
Waitrose ads where they demand that the farmers who supply them leave
wider field edges so dormice and barn owls can thrive? They’re all
heart! Of course it’s the farmer who’s likely to lose out, not
Waitrose. And we’ll be encouraged to pay a premium at the checkout
because we’re all softies. The enemy is not the supermarket chains. The
enemy is the capitalist system. But capitalism has evolved the
supermarket system as the orchestra conductor of food production, in so
far as there is one. Though competing among each other, they dictate
terms to all the other actors. We need to take them over as part of the
socialist transformation of society.
