by Galen Hunt, MPA '21 for Annotations Blog

I was in a taxi on my way down the hill from a middle school I worked at in the Guatemalan countryside. The potato farmer sitting next to me struck up a conversation. He asked me if I could help his group of farmers file the paperwork to become recognized as a potato-farmer collective; they had been unable to sell their crops at a profit that year and were desperate to organize. I lamented that I did not know the process. As I said goodbye to him, I wondered if, even as a collective, they would ever again be able to eke out a profit.

President Biden has made ambitious promises to tackle the “root causes” of migration from Central America through $4 billion USD in development aid to address poverty, violence, and corruption. The administration’s commitments to economic and institutional development are underscored by the recent high-level visits from Vice President Kamala Harris  and USAID Administrator Samantha Powers to Central America. This strategy, in contrast to that of the previous administration, reflects the “big-push” mentality championed by economists like Jeffrey Sachs who believe that underdevelopment can be solved by massive aid investments by industrialized countries. But this approach is unlikely to produce the desired transformation as long as U.S. agriculture policy and trade policies work directly against the interests of Central American farmers. 

In particular, the Central American Free Trade Agreement (CAFTA) of 2005 pits regional farmers against U.S. growers. For example, when U.S. corn surpluses are too great, driven by an agriculture policy that incentivizes ever-increasing scale, the United States dumps these commodities on emerging markets selling at below the cost of production. Poorer corn farmers in Central America are woefully under-equipped to compete. 

Corn and potatoes are hearty crops able to grow in Guatemala’s higher altitudes and rocky soil. Development projects attempting to help affected farmers transition to higher value crops have produced underwhelming results. Droughts driven by climate change also exacerbate the difficulties of growing profitable crops in the country. Additionally, corn production bears a cultural significance that cannot be understated; the Mayan creation myth even describes the original humans as beings built from corn. Thus, simply convincing and teaching farmers to grow more valuable crops does not seem to be a durable mitigation strategy either.

U.S. development aid to the region in many ways seeks to undo damage done by other wings of the U.S. government. In essence, we’re arm wrestling with ourselves.

Furthermore, CAFTA came touting strong provisions for improving labor standards in the region but has failed to foment meaningful action towards addressing poor working conditions and anti-union violence on large plantations. These provisions failed to stop the killing of some 68 Guatemalan unionists without a single arrest. In 2008, the AFL-CIO along with Guatemalan unions filed a formal complaint under the trade agreement’s labor provisions, citing anti-union violence and wage theft. The case failed. At present, anti-unionization efforts, dismal wages, and other labor abuses continue.

Although CAFTA brought increased opportunity to many small- and medium-sized Central American businesses, small-scale farmers and farmworkers have borne the brunt of the downsides. Out-migration from rural areas should not come as a surprise when the compounding effects of climate change and unfavorable terms of trade combine to damage rural livelihoods. U.S. development aid to the region in many ways seeks to undo damage done by other wings of the U.S. government. In essence, we’re arm wrestling with ourselves. 

Ultimately, any development strategy for Central America will not produce desired results unless it is situated within a larger U.S. economic and foreign policy strategy that places the experience of the Central American farmer at its center.

While it is naïve to think that the Biden administration would take action that would benefit Guatemalan farmers over American interests, it should recognize the role of U.S. trade policy as one of the root causes of migration. It should seek ways to harmonize trade policy with development policy objectives. It should focus on helping small farmers commercialize current crops, and shift to growing higher value crops that do not require significant capital investments and behavior change. The administration should hold multinational corporations and suppliers to U.S. companies accountable for labor violations through strengthened labor provisions.  Finally, we should expand and better regulate the H2A and H2B guest worker visa programs and add a human capital development element by creating avenues for returned migrant farmers to invest their earnings in capital projects and apply experience and knowledge gained. Ultimately, any development strategy for Central America will not produce desired results unless it is situated within a larger U.S. economic and foreign policy strategy that places the experience of the Central American farmer at its center.

But despite the recent visits from influential decision makers and declaration of redoubled support,policy from Washington may only go so far. At a deeper level, what may truly be needed are Central American negotiators with the willingness and ability to go toe-to-toe with Americans and champion the interests of their small farmers. Perhaps we should not expect a truly effective development plan for Central America to emerge from policy drafted in the halls of the White House, where true incentives for regional development are murky. Rather, it will come from the will of many motivated farmers, unionists, and anti-corrupt politicians across these countries to organize, strategize, and compete, regardless of whether this counteracts U.S. corporate interests.