16 - Small farmers in 1999 shout "Oi!"...

…Can you not hear me up there? This shit aint working out for us down here! Cheap imports and a strong currency are somehow making milk from Italy cheaper than the milk I just squeezed out of this cow right here! And how on earth are we meant to finance investments with double-digit interest rates? Market pricing is squeezing our profits to below profitability. We have already lost over 1.3 million hectares to market pressures. Can’t you see? Are we really that expendable?” It certainly did seem so. But then again, what has changed since abolition? I’m sure people would say a great deal. I’m sure they’re right. But financial pressures and public policy’s priorities have been squeezing farmers into the ground and forcing them to crawl to slums in the cities or over 100 years. This is despite their benefits to the environment, health, culture & society, their efficiency per square meter, food security for the poor and all the multidimensional aspects of family farming we looked at earlier.

Could all this have happened because of the neo-liberal path we walked down a few moments ago? Maybe. But just to make sure the knife is twisted, say hello to my little friend.

His name? William Thomas Oswald. His occupation? Trade negotiator. (Known as WTO by his friends and foes alike). This character is a strange creature born after world war two, like all the other global governors: The UN, the IMF and the World Bank. His destiny, he assures us, is to strive to create a romantic world where every nation in the world loves its neighbour so much, that none would be rude enough to stick its tariffs up at the other. Sounds like a wonderful idea. But wait a minute. How come small family farmers in Brazil are not walking around whistling with that romantic spark in their eye?

I know a guy who knows The WTO like the back of his hand. His name is Adriano Campolina, and he is the policy officer at Actionaid. Adriano specialises in dealing with the WTO, and getting ‘him’ to see that his policies are not having the promised positive effect on the small farmers who’s rights Adriano fights for. I go back to Actionaid several weeks after meeting with Glauci. It’s always a pleasure to walk into such a pleasant working environment, and the warm welcoming smiles of the people I come across.

Adriano is a little late and apologises profusely. “The traffic! It’s a nightmare”. He looks more like a banker or a consultant on a dress-down Friday than a man fighting the system in the belief that another world is possible. His look is a reflection of his professionalism, knowledge and experience rather than a conservative slant. After reading his chapter in an impressive book on trade, food security and small farmers, I note his name hoping to somehow track him down, and I am delighted to realise he is a contact Glauci suggested I speak with. 

Link> http://www.globalexchange.org/campaigns/index.html

15 - Seeds & sprouts

As I take a bite and stare at the black seeds embedded in the apple I am holding, it hits me: One day I might be forbidden by law to take that seed and plant it in my back yard. The fact that I don’t have a back yard is irrelevant. It’s the principle that bothers me. That seed might be the intellectual property of a bunch of shareholders on the other side of the planet. Planting the seed and reaping the fruits from the future tree could well be considered as theft!

This concept fascinated me. It seemed absolutely absurd. So I decided to visit Actionaid and speak to Glauci, an advocate against transgenics and for food security. I took a cab from Ipanema and we drove around the lake to Actionaid’s beautiful little house on the other side of the large expanse of water. An old pink house sprung humbly from a plush concentration of plants and flowers. A few seconds after pressing the button on the interphone I heard the reciprocal buzz allowing me to push open the black gate. I entered the pleasant and welcoming world of Actionaid, the Brazilian arm of the UK’s biggest NGO, with offices in several countries around the world.

Glauci finds me flicking through the front covers of the last three editions of The Economist magazine placed next to the latest edition of Democracia Viva, a thematic publication by Ibase, which I highly respect for its depth and breadth. I am lead into an inviting conference room where I am slowly exposed to the world of agriculture.

As a city guy I never really gave much thought to agriculture, and pretty much took the landscape of the countryside and the food in the shops for granted. Here I am with a professional who dedicates her life to the cause of monitoring and solving the problems of the rural sector. Within a few minutes Alberto Silva, a director of Actionaid Brazil joins us. He tells me about their work in Paraiba, in the North East semi-dry region of the country. There he says they are working with communities of family farmers, helping them build primitive but effective water tanks using the roofs of their houses to collect rainwater. He even draws a house and its roof on the blackboard to illustrate his point, maybe conscious of my weakness Portuguese. He also tells me about a community seed bank, which is exactly what the name suggests, a bank that borrows and lends seeds as opposed to money. At this point I am beginning to wonder what all this has to do with GM crops.

Soon I learn that the GM issue is part of a wider struggle for eradicating hunger and for the preservation of our environment.

Before I even delve into the question about GM, I am exposed to the bigger picture. And for an ignorant city boy like myself, I am astounded that such a far-reaching struggle with such incredibly profound consequences has been taking place away from the public sphere I have been exposed to. The mainstream media I guess decided that bringing these issues to the attention of the masses is unnecessary, and would rather keep this debate behind closed doors.

But what a debate! Farming touches issues well beyond the obvious production of food for consumption. It has impacts on our health, the environment or more precisely the ecosystem and its bio-diversity, the economy, our culture and way of life, employment and of course, securing food and nutrition for our survival.

The world of agriculture can be split into two camps, family farmers and large commercial farmers. They are not just thought of as separate because of the difference in size, but because their effects on all the above aspects are clearly different. The European Union gave farming an adjective that describes this multi-dimensional relationship it has with the world around it. It calls it the ‘multifunctional’ nature of farming.

In Brazil, approximately half of the people below the poverty line live in the countryside, and many of them are excluded family farmers struggling to make ends meet. There are over four million family farms (plots smaller than 100 hectares) occupying almost 108 million hectares and over half a million commercial farms occupying 240 million hectares.

That’s over 85% family farming establishments occupying 30.5% of the farmland, and actually contributing 37.9% of the National Gross Value of agricultural production (NGV). That’s about 6 billion dollars (18.1 billion Reals). In the North east family farming contributes about half the NGV.

Despite cultivating just over 30% of agricultural land, family farming employs 76.9% of rural workers. This is because large commercial farms exploit 67.5 hectares of land per employee, compared to 7.8 hectares per employee in family farms. Furthermore, large commercial farms are known to be the worse employers in Brazil. 

So as we can see, family farmers contribute significantly to economic activity, and actually contribute much more per hectare to the GDP (Gross Domestic Product, often used to measured economic growth in an economy) than commercial farming. In fact, you might be as surprised as I was to learn that on average, a family farm generates R$104 per hectare per year, whereas a large commercial farm only produces an average of R$44 per hectare per year. This higher efficiency occurs in all the regions in Brazil. This is despite receiving only 23.5% of total agricultural financing. So large commercial farmers, who own a disproportionately large share of the agricultural land in Brazil, owing to the distribution of power back in the days of colonisation, receive 76.5% of the government financing, despite being less efficient.

Most of the products grown by family farmers are for domestic consumption, whereas most of the crops grown on large commercial farms are for the export market. Most poor people living below the poverty line survive on products grown on family farms, such as rice and cassava beans in the North East. Family farming offers the poor more than just home-grown food. It offers millions of poor people access to food through the wages paid to those millions working in family farms.

With overall agriculture occupying just under half of Brazil’s ecosystem, it is not surprising that as well as having a profound economic impact, it also plays an significant role when it comes to the environment.

Methods of farming have a tremendous impact on land and water in a multitude of ways. Chemicals, whether herbicides or pesticides, used to protect plants from insects and herbs for instance penetrate the land as well as rivers and lakes. Methods of planting and harvesting also affect the soil and the bio-diversity. Commercial methods of farming for example tend to replace diverse flora with monocultures. They also often cause land erosion. Large commercial monoculture farming needs enormous land cleared of trees. This method of farming was developed during the ‘green revolution’. But the absence of trees and roots allows the healthy top layer of soil to slide away when it rains, or to fly off when it’s dry and the wind blows. This is known as land erosion. These are just a few examples of the potential negative impacts farming can have on the environment.

Family farmers on the other hand often have a positive impact on the environment. Their priority is to feed themselves, the family, and to preserve their land for future harvests and future generations. They are less likely to sacrifice the long-term sustainability of their land for the pursuit of short-term profits. Put it this way, if the economy pushes the agricultural sector into a crisis, a family farmer can eat what he grows and live on very little money and survive, albeit only just; a commercial farmer on the other hand would have the dark shadow of bankruptcy looming and would feel much more pressure to ‘cut corners’. It’s this commercial pressure to ‘cut corners’ that drives the ‘environment’ further down the priority list of commercial farmers.

Family farmers usually grow several different types of crops, such as rice, beans, tobacco, tomatoes and onions. This is in direct contrast to the monoculture of a large commercial farm that specialises, say, in corn. The diversity is good for the land, and helps preserve the bio-diversity. Even the decision makers in family farms are in a better position to make decisions aligned with the environment, as they are the ones working in the fields. They touch the fruits; they know every inch of their land. Decision makers in large commercial farms are usually detached from the reality on the ground, and their decisions are more aligned with the profits that they seek. Family farmers value the ecosystem in a way that is meaningless to a purely commercial mind frame. The birds and butterflies for example are worth zero to the bottom line of a balance sheet, but are priceless to a family farmer who would be horrified to wake up one day and find that they have all disappeared.

Even a family farmer has a choice of techniques available to him or her, each with varying effects on the environment. The relationship between farming and the environment has been the subject of continuous studies. A method of farming has been developed, which according to the experts is the most sustainable and healthy method of farming available today, for both the environment as well as our health. It is called agro-ecological. This method requires small patches of land, and requires more people to tend to it.

The viability of family farming doesn’t just depend solely on producing crops. Numerous social factors play an integral role in the viability of family farming, such as access to healthcare, education, culture and leisure amongst many others. If I were born in a family farm, I would need more than just a good harvest to keep me from pursuing another life in a big city far away.

Public politics, in other words the actions society takes as a whole, can have a tremendous effect on family farming. These include macro-economic decisions, decisions on infrastructure projects, decisions regarding incentives and taxes, regarding government spending on health and education. In fact every decision taken by society, or by the government, will inevitably have effects on certain sections of society. The multifunctional aspect of family farming, with its critical impact on the world around it, calls for ‘political’ decisions to be made in light of their possible effects on this crucial sector of society. I put an inverted comma around ‘political’ because some people try to separate political decisions from economic decisions. Economic decisions are political. What a just society aims to do is make political decisions for the benefit of the majority, or in favour of those most in need. This is why the belief in democracy, the equal representation and participation of all the people, is so widespread.

Unfortunately in Brazil it seems that those making the political and economic decisions on behalf of society at large do not consider the repercussions on family farming as worthy of primary concern. This is evident when looking back at Brazil’s economic models of ‘development’ before and after 1990. 

14 - Alternative Money in Porto Alegre

The social benefits of the Tupi in deserts of capital, where people can produce but have no means of triangular exchange, is enormous. But as Ari confirms the next day when I track him down at a meeting of several representatives of communities managing Tupi-based trading systems, the system is not meant to work for millions of people, and certainly, in his opinion and those sitting around the conference table, is not designed to replace the existing monetary system. It is only, he explains, designed to stimulate trading and self-sufficiency amongst excluded communities.

Ari does tell me about a country that turned to a similar trading system called the Trueque. In Argentina, after the flight of short-term speculative capital left the country with virtually no access to credit, people began using their own community-based currency for trading. The system never reached the mainstream shops and businesses, but according to the BBC around 5 million people relied on the Trueque for triangular exchange. Others believe the figure was nearer one million. Either way, that’s a lot of people. The system had no time for planning, instead it just flourished over night. Employees of factories that went bankrupt turned around to the global financial system and screamed “Vaya te!” telling them to go away. “We have the factories, the machinery, the workers and the know-how. We don’t need you!” And so the Trueque system supported a large layer of people who otherwise would have fallen through the cracks of capitalism, cracks that widen during times of crisis. The Trueque system eventually collapsed because of corruption and miss-management, owing to the speed of its implementation. But in Argentina, when the capitalist system turned its back on an entire nation, people did not wait around hopelessly. They took the situation into their own hands and managed a deep economic crisis; a predictable economic crisis that has been tearing countries apart one after the other over the past twenty years.

My three months in Rio have exposed me to a snapshot of reality in communities living marginalized lives at the fringes of society, and helped me make sense of this snapshot of reality in a historical and economic context. My journey to other parts of the country begins with a taxi waiting to take us to the airport. Our next stop: Porto Alegre, the famous city in Rio Grande Do Sul, in the Southern tip of Brazil. On the way to the City hotel from the airport I have the impression of having gotten off the train a couple of stops too soon on my way to a cute skiing resort in the Swiss Alps. It’s a dull, built up, grey city on a lake referred to by everyone as a river. Mind you the thick layer of clouds blocking the last remnants of sun in a winter afternoon might be an unfair time to judge Porto Alegre, home to the first three World Social Forums, and the focal point to the world for its system of participatory budgeting and democracy.

The next day, still overcast, we catch a taxi to the other side of town, and notice the driver trying to rip us off by setting the meter on 3 (the late-nigh week-end charge) instead of 1. We manage to scrape a little off the price out of principle, and enter the year old offices of Instrodi, the magnet that had drawn us South to the coldest tip of Brazil, away from the hot and sunny beaches up North. I am sitting with Camilio, a visionary who’s come all the way from Holland a year ago to help set up an Instrodi office in Brazil.

Camilio is a young dynamic guy full of energy in his early thirties I presume, not too tall, broad shouldered, coarse stubble and short light brown hair fashionably all over the place. He has an intense look, a cross between questioning and confirming. Camilio is certainly known within the civil movement, or at least many people I spoke to in Rio had heard of him. He often publishes articles and lectures about his work.

Apart from him being known within the narrow scope of civil society, or at least within the even narrower spectrum I have been exposed to, Camilio is an anonymous guy doing his thing. Yet hidden away between his office on the outskirts of town and his farm-house an hour away from Porto Alegre, Camilio’s vision is no less than an economically vibrant Brazil, independent from the global financial system holding this country to ransom, and free of the IMF debt, its suffocating exponential interest and its painful anti-social conditions holding Brazil in a state of paralysis. No, he doesn’t just dream of this, he believes he holds the road map ahead.

To understand Instrodi’s proposed solution to communities, neighbourhoods, municipalities, civil movements and business networks making up Brazil’s population, it is essential to understand the present global financial system, and its fundamental component: money. Blue and black felt-tip pens in hand, Camilio stands in front of the white board and begins my first lesson.

Once upon a time the ‘currency’ used for triangular exchange was a commodity or product of actual value, such as salt, shells, gold or precious stones. Five thousand years ago the Egyptians held large stocks of grain that were used as a means of exchange of goods and services. This however became inconvenient, especially when large amounts of goods were traded across vast expanses of water, and equivalent values of gold would have to sail the opposite direction. A genius answer to this logistical problem of early triangular trading was the invention of a bond. You could deposit a certain amount of gold in a ‘bank’, and get a piece of paper with your name on it as an equal representation of that gold. Like that you didn’t have to drag along kilos of gold to buy tons of rice. So far so good. Then someone in the middle ages in Italy turned up at a ‘bank’ with no gold, but offered the banker a deal: “Lend me the gold, and I can buy low and sell high, and I’ll give you a share of the profits”. The banker agreed. This printed piece of paper was guaranteed not by gold but by the value expected to be generated by the borrower. Its cost was literally the piece of paper it was printed on, but the cost of borrowing it was the promised share of profits. Its valued lay in the ability of the borrower to use it to generate value. Eventually all the gold was sold (the US Dollar was freed from gold in 1971) and since then expected value generation by borrowers has been the major guarantee of the value of money.  

Today private banking institutions offer money for investments and trading by creating it and lending it against a small base of money deposited with them. Usually national laws state that only 10% of loans need to be guaranteed by deposits. So with 1 pound (with the necessary licenses of course) I can legally create (on a computer screen) 100 pounds and lend it out. This percentage can be tweaked by governments as a tool to control money supply, although seldom used. Should these loans not be honoured the bank risks bankruptcy. These would be called bad loans. The cost to borrowers seeking this means of exchange for the creation and trading of the products and services they work so hard to generate compensates the bank for its risk of bad loans. This cost is called interest. This interest is exponential, which puts borrowers under pressure to repay loans on time.

There are only two ways of getting hold of this means of exchange for investments and trading: Loans from banks or equity from investors. This interest rate is the benchmark of minimum accepted profitability for investors. Why would anyone accept less from a real product or service generating project if they can make more from a seemingly interest free return from low risk government bonds? This race to maximise the return on investments and loans (with the minimum acceptable return being the exponential interest paid by governments) is how people and communities can gain access to the means of triangular exchange necessary for investments and trading.

There are several problems, explains Camilio, with this global financial system of spreading access to the means of exchange: First, people and communities must be able to communicate to lenders and investors. Some communities are so remote and seek such small amounts of money for their local trading needs that it is not even worth investor’s time and effort to deal with them. This creates what are known as deserts of capital, where people are suspended in paralysis.

This is one reason why there is a shortage of capital in the productive circuit. Yet there is plenty of money in this world. The amount of money in this world has increased 10,000 times, explains Camilio, since 1945, yet production has only increased 50 times, “which is huge by the way. For production to multiply by 50 in 50 years, it has never happened before in human history. But money multiplied 10,000 times, and still there is not a money surplus but a money shortage. This is contradictory”. So where is all this money then? Camilio explains that it is in the speculative circuit. Embedded deep in a mind-opening speech by David Corthen, a modern day economist who might one day be remembered along side legends such as Keynes and Smith, is reference to the fact that approximately 99% of money in this world is speculative. A speculative investment adds absolutely no value to people and communities; they are purely designed to take advantage of an expected increase in price, in other words inflation. So when people buy land purely for the hope of selling it at a higher price in the future, without harvesting it or building on it, this is a speculative investment. When shares are bought hoping to be sold for a profit, this is a speculative investment. When currencies and bonds are traded, they are bought and sold purely as a speculative gamble. No tangible value is generated in the real world.

Yet only 1% of money is flowing in the productive circuit. This scarcity of cash as an essential fuel for production and trading is forcing companies to compete ferociously for capital from a speculative circuit where returns must exceed interest rates. This competition for the scarce resource, money, is what drives companies to offer maximum returns, no matter what the consequences on the communities they function in, the people they employ and the environment they affect. The best way to attract money from the speculative circuit, where exponential interest rates are a benchmark, is to offer exponential returns. If you set up a business selling a constant stream of products, such as a shop selling at full capacity say, the returns are linear. So an investment of 100 pounds could yield 25 pounds a year of profits. This return however is linear. In order to be even more attractive, and therefore attract money from the speculative circuit to the productive circuit, a company needs to grow. (One could argue that profits could be re-invested into another linearly profitable venture, thus creating exponential returns. But what would you chose if returns were your only objective in this system, a business that offered you this level of exponential returns, or the headache of searching for another attractive opportunity every time you receive profits? A speculative investment effectively reinvests the profits every second with no effort whatsoever.) The interest-based financial system, concludes Camilio, therefore creates deserts of capital, and forces businesses to compete ferociously for scarce capital, at the cost of communities, employees and the environment.

But money, Camilio says, has been demystified. People are beginning to understand the nature of money, as an invented number on a computer screen (sometimes physically represented by a piece of paper) given value by the expected productivity of the borrower. Communities are waking up to the fact that it is their work and their risk that is guaranteeing the value of money that is created from nothing by private banks, and that generating this money is as simple as ABC, if managed properly. People are also realising that money can have any characteristics we choose to give it. The interest rate set by a free market of speculative investments is just one way of allocating cash to projects. It is clear to many that this system has failed to provide the necessary means of exchange for the development of communities all over the world. People are also waking up to the fact that even if interest rates were paid on borrowed money, there is no reason to give this ‘tax’ on the use of money to banks on the other side of the planets. The interest could quite easily go into a community account, to be used for whatever the community chooses to use it for. Or maybe communities can find other ways of ‘programming’ money without the use of interest rates, to suit their own specific needs.

Instrodi has built networks of alternative socially friendly money in Spain, Holland and Ireland before coming over to Brazil. Their system has developed over time, and they have recently developed software for administering the latest version, and built into it enough flexibility to give any community the choice of how to program it. Instrodi give the option for communities to choose an inverted interest rate on cash. Camilio explains that this would encourage people to spend the money they make, thus promoting local development. Furthermore, the local currency would encourage people to buy products made inside the community, as a ‘tax’ could be charged for converting the money out of the community. The money charged for either holding cash or converting local money would go into a community account. This could be used for whatever the community chooses.

The thought of having my money depreciate in value on a monthly basis gives me the shivers. I want to be able to save for my children, or for a year off travelling, or an expensive product. I ask Camilio how one could save for security or an expensive purchase. He explains that their program allows for a savings account. But this savings account does not pay interest, which in many religions is considered as wrong, but can be placed in a fund, and made available for loans to people in the community looking to open a business. A carpenter could use it to buy some tools for example.

“Oh my God!” screams out the capitalist trained side of my mind, “surely this is risky!” Camilio tells me to think about it: If all the businesses that borrow money free of interest fail, then yes, my savings would be lost. But within the community, if these loans are made democratically, then the majority of the people obviously think it is a good idea, and their own money is also at stake. So overall you must trust that the community, using a democratic process, would make the right investment decisions that would add most value to the community. Think about it, if the customers are also investors and employees, you have a better chance of success. So overall, savings should increase. The key to the success of this social currency is a truly participative democratic process. This must be the new driving force behind investment decisions, because communities are in a better position to understand their own needs than speculators and lenders on the other side of the planet. And anyway, why should these unaccountable institutions profit from the work, the risk and the natural resources of a local community?

Giving a community economic democracy and increased autonomy from the global financial system, whether a local neighbourhood, a chain of businesses, a cooperative or a municipality, would unleash a torrent of creative energy to structure community-based economic systems in a multitude of ways. This would bring humanity back to the markets where it belongs, turning money back into a useful tool for triangular exchange, back from its current status as master.

I’ve been here four days now, and I have had a chance to think over the overwhelming wealth of paradigm-shifting information from Camilio and the serious amounts of reading I have been given. I am heading back to Camilio for my last chance to have a chat before I leave to Sao Paolo. To my pleasant surprise Camilio suggests we head down to the beach for a more pleasant atmosphere. I find myself sitting on the edge of a road abruptly terminated by a one-meter dip into a narrow expanse of public beach cut short by private land on either side. I am overlooking a vast expanse of sea naturally cordoned by hills in the not so far horizon. The sun is an hour away from setting behind the hazy-green hills, still warm enough to keep my cotton sweater wrapped around my waist. 

I ask Camilio what his dream is for Instrodi’s alternative community-based economic system, and what he believes Brazil can gain from it. He tells me (and I quote from memory as I don’t want to ruin the vibe with my recorder): “Imagine if every community in Brazil is freed from the need to please the global financial system for its means of exchange, and every community is trading with one another, linked democratically into a web, with Brazil as its whole. Then, and only then, can Brazil turn around to the IMF and say, “Go away, we don’t need you any more”. If Brazil did this today, it would cause a serious credit crunch that would paralyse the country and turn it into a desert of capital. Today, Brazil relies on the global financial system for its means of triangular exchange, but one day I hope Brazil can become independent, free of the financial blackmail from the global financial system”.

I sincerely wish him luck as we say goodbye, and on my way back to the hotel I am somehow left with a positive and optimistic feeling about Camilio’s ambitious dream for Brazil. Despite its mammoth scale, it makes sense; and it’s this logic and reason that leaves me with a sense of belief that another Brazil is possible. A democratic Brazil made of communities in control of their own destinies. 

13 - Tupis & Mirins

It’ cold, grey, windy and raining. No I haven’t cut my trip short and returned to London, in fact my brother tells me the sun is shining and the weather is blue in London, and people are half-naked in the parks. It’s the beginning of July, the onset of a Brazilian winter. This grey Sunday will not stand in the way of the weekly fair in the Paso do Peisce, a community of around four hundred people living in the hills near Teresopolis, a mountain village two hours from Rio.

The second bus I take from Teresopolis stops to drop me off at the spot I had requested. People stare at me as I walk to the rear exit and get off seemingly in the middle of nowhere. As I begin walking down the dirt road the bus driver had indicated, a truck drives past. It takes merely my inquisitive look for the driver to stop and offer me a lift. As we drive down the windy dirt road, I look out and admire the serenity and lushness of the hills around us. Thick vegetation and trees make the few houses we pass on either side and in the distance barely visible.

The kind man drops me off at the mouth of another dirt road, this one narrower and muddier. I ask the first person I see for the Casa do Ari (the house of Ari). I am told to keep going until the end of the path, about fifteen minutes walk. I figure that if it takes this kind old lady fifteen it should take me ten. She expresses this exact thought, “I am an old woman, it should take you a little less than that”. We laugh.

As we approach the end of the path the hills on either side converge into a steep hill separated from the muddy path by a wooden gate. A side entrance allows us to continue our journey up a cobbled path leading to the Casa do Ari.

I am astounded by the natural beauty of this heavenly spot, with a small water fall, and stream and a little river. All around us are tropical trees and all sorts of plants, and in no particular pattern I come across a circle of carefully planted herbs; several different types of herbs separated by well placed stones as though it were a pie cut into slices. I notice several such man-made plantations, each containing different types of herbs. In the centre is what I assume is the Casa do Ari, a wooden house with an open-air courtyard right outside.

Ari is not there, but his assistant kindly explains that he will be back soon. I meet a young kid called Fernando, who takes me to meet his family. He says I could call Ari from their telephone. Ari’s line is busy, but Fernando’s mum assures me he will definitely be back later for the Sunday fair. They invite me to sit in their balcony and wait for Ari. I oblige.

In this wonderful spot people began to claim land that was uninhabited and un-cultivated, and built their own houses themselves. Fernando’s uncle joined his brother five years ago and was proud to show me his redbrick house that he built with his bare hands. He explains how he was lucky to find a piece of empty land so close to his brother’s house. The house cost him about three thousand Reals, and he built it slowly by buying materials in phases. A loan shark lent him the money, which considering he earns 350 Reals a month, takes a long time to pay back. Banks would not lend him money because he doesn’t have a secure source of income or a legitimate address. Until recently there were no toilets, now toilets exist in the houses and are flushed into the river further down, untreated. No one has bothered to build roads for these people; in fact their existence is illegitimate in the eyes of the law.

Fernando takes me to see the river that gives them water, and I can see the joy in his eyes when he explains the water is fine to drink. I tell him he is lucky to live in such wonderful surroundings, and he responds with equal enthusiasm, clearly appreciative of what he’s got. I admire such wisdom and reflection from a fourteen-year-old. Later he takes me back to the house to see his drawings. He draws very well, and I am particularly impressed by a surrealist depiction of a rose sticking out of a boat. His mum looks on proudly and explains how they cannot afford to buy him paint and canvass. Fernando also builds wooden airplanes. He is clearly talented and I hope he finds the opportunity to develop his skills further.

An hour or so later Ari arrives. He is tall and thin, has a long face, a thick black beard and shoulder-length, thin black hair tied in a ponytail. His big blue eyes pierce through his bearded face and will quite happily stare you straight in the eyes while he is talking to you or listening tentatively. His intensity is not intimidating however, but comes across as a product of his passion. For Ari is certainly passionate about his work

Eight years ago Ari left his previous home near Calcutta in India, and came to settle here. Ari explains how at the time there were no toilets in people’s houses and no electricity. He tells me how he expects nothing from the government to whom these people are insignificant. He stresses how they receive nothing, and repeats Nothing with a capital enn  to stress the level of neglect these people have experienced. But Ari does not feel sorry for the people he has been living and working with for the past eight years, on the contrary. He says “We don’t need the government, for me there is no government; poor people can organise themselves”. From what I can see they certainly seem to have come a long way. Their main street, the long dirt road I walked down towards Ari’s house, is spotless; a symbol of the pride these people have for the little heaven they are constantly working to develop for themselves.

A good half an hour away from the village of Teresopolis, the people of the Paso do Peisce are striving to be as self sufficient as possible. This self-sufficiency is the vision of Ari, who has taken this village on a sturdy step forward towards this ideal: Ari is an agronomist, and specialises in growing medicinal plants. He took me to see his laboratory.

I am fascinated by what I see. There are three rooms. The first one, the largest room, is where the herbs are dried and packed into a mountain of well-labelled brown paper bags. In the second room, the dark room, I am facing shelves with a multitude of large glass jars containing a mixture of distilled water, alcohol and leaves. Ari explains that it take about ten days for the mixtures to be ready for consumption. The third room was filled with ready-to-consume medicines. Ari explains: “In these grounds you see around us we grow 180 different types of herbs, enough to cure 90% of illnesses”. He explains how before he arrived, people had to either spend a fortune to buy commercial medicine from the pharmacy or simply do without due to the un-affordable prices. Now everyone in the community relies on the medicinal herbs for a cure. They barter whatever it is they make, grow or possess in exchange for these cheap and effective remedies. Colds and flues are the most common forms of illness.

As I am reaching the peak of my admiration, indulging in this romantic utopia come true (yes, it seems utopias are at an arm’s length), Ari brings me back to the harsh realities of the world around them, our world: “The police have closed us down twice already because we don’t have a license to operate. Of course this is because we are a threat to the big pharmaceutical companies. The license is extremely expensive and we simply cannot afford it. Only the big commercial laboratories can afford the license. But I continue to work, and if they want to arrest me I am here, ready to go with them”, Ari crosses his wrists as if he were handcuffed. “There is enough of everything for everyone in this world; enough food, enough clothes and enough medicine. The only problem is how to distribute it, how to spread it, how to share it… Look around you” he says, waving his hand at the hills surrounding us, “my partner and I alone run this entire operation. My colleague tends to the plants and dries them, and I am in charge of mixing the medicine and selling it. Every community in the world could have a set-up like this”.

After the initial shock that the government, the so-called decision-making body of the people through the system of governance, has made such easy access to medicine illegal, I remember the Radio do Gran Tijuca, and that over 100 small radio stations had been closed down since I landed in Brazil three months ago. Again this was blamed on the threat they presented to large corporations. It is still hard to come to terms with the fact that Ari, who in my eyes is as good a man as can be, who is loved and respected by the people of his community, is a criminal in the eyes of the Law.

I find a chair in the courtyard outside Ari’s house, and talk to Ari and Fernando’s uncle about the exchange fair that was about to take place at 3:00, as is the case every Sunday. Ari hands over a piece of printed-paper in the shape of a bank note. I am holding in my hand one Tupi. Ari explains that this is equivalent to one hour of work, which is equivalent to ten Reals. I ask Ari why ten. “It is based on information from the Brazilian Institute for Economic research, that an average worker, to satisfy his or her basic needs, needs R$ 1,400 per month, equivalent to R$10 per hour”. Half a Tupi is equivalent to fifty Mirins. Ari explains that a manufactured product is valued by the time it takes to produce the item, plus the value of the raw materials used to produce it. A service is valued the same way.

I ask Ari why use Tupis and Mirins as opposed to Reals. He explains, “First of all people here do not have Reals. Here in this community there are very few Reals. In fact in Brazil there is little amounts of Reals circulating. So by introducing this social currency here in the village, we achieve a ‘triangular’ exchange. The currency is a means of exchange. Second, the real devalues, but not the Tupi. The Tupi has a value worth one hour of work”.

Tupis are not actually convertible into Reals. This rate of R$10 to one Tupi is a way of valuing different products for exchange. It is not meant to be an exact science, simply a way of putting a rough value to a product for exchange. Which makes sense, because if you were about to barter a product for another, you would have a very rough idea of what your product and your counterpart’s product are worth. This rough approximation, with a little negotiation is all you need to value and trade those products. The Tupi offers a benchmark for valuing products for exchange, and thus allows what Ari calls ‘triangular exchange’.

Furthermore, everyone who arrives with a product for exchange receives a five Tupi loan, payable a week or so in the future if not later that afternoon. This simple system is effectively a way of generating micro-loans. One could use the loan to buy say oranges, turn the oranges into jam, and exchange it the next week for some oranges and some bread, as the profit is the work it took to make the jam. As there is no interest on the loan, and no loan shark exploiting the vulnerability of the poor, this system offers an honest path to the development of this community.

Children and young people are active participants in this system of exchange. It is a wonderful educational tool, as children learn the true value of money as a note that represents the work done, and the value of the end product to the community. Therefore work is of more value than money, and not the other way round. It also encourages children, as well as adults, to become productive within the community, and think how they could turn the resources around them as well as their skills into sought after products and services. A child could buy the ingredients to make biscuits one week, using the micro-loan, and exchange the ready-to-eat biscuits the next week. If these biscuits prove to be very popular, ‘customers’ will drive its ‘price’ up by out-bidding each other, from say 1 Tupi to 1 ½ Tupis, which should encourage others to make biscuits for the following week.

Today is a cold and rainy day, so only one table was needed for just a few participants brave enough to venture out and go ‘shopping’. The painted cotton sign in the background says “Let us together build another Brazil that we all want, with little money and a lot of exchange, without corruption and with a great deal of solidarity”.       Today about thirty people turn up, which is half the usual number. Products include home made products such as bread and biscuits, which prove to be the most popular; home grown fruits and vegetables, such as lemons, bananas and lettuce; and second-hand products such as belts, a harmonica (Fernando’s brother is delighted to earn/buy that one; now you can always tell when he is nearby) and books. Everything was exchanged within a few minutes. Without the Tupi and the accounts held by a ‘rotating bank’ (Ary is covering for someone else who is in charge of overlooking the accounts this period), this system of exchange would be impossible. How would you split a harmonica in half and buy its equivalent value from two people selling fruits and bread? It would be impossible. This is what Ari is talking about when referring to their system of ‘triangular exchange’.

Ary explains how this system of exchange is extended to ‘cooperatives’. For example many households own chickens that give eggs, which are exchanged within the community. Unfortunately the price of corn to feed the chickens is very high, as it is set by the global market (with influences beyond the control of this community, such as the exchange rate). So they are creating a ‘cooperative’ to work in the fields and grow corn. These workers will ‘exchange’ the corn for Tupis, and households with chickens can ‘exchange’ their Tupis for the corn. Ari’s dream is for this community to become as self-sufficient as possible. “We are building a chain of solidarity economics. We are becoming self-sufficient within our community. If we need something, we make it… all this creates work and creates income within the community and we strive towards self-sufficiency. For example today we have bread, which is made here in the community. So the exchange fair offers a solution for our basic needs, as people start producing those basic needs and exchanging them in the exchange fair.” Ary is thinking of encouraging the production of cleaning products such as soaps, shampoos, detergents and other home made products. These are good for the environment as they are made of natural ingredients, and are cheaper than the chemical-based products on the market. This would be one step nearer Ary’s dream of self-sufficiency for the people of Paso dos Peisces. Ary believes this system of exchange therefore breaks the traditional dependence people have on money, and frees the people to produce and ‘earn a fair exchange’.

“How does the cooperative system reflect the difference in effort and skill in a group of workers, if they all earn the same Tupi per hour of work?” I ask, self-conscious of how ludicrous this question must sound within this set-up of four hundred close-knit community members. Ary responds, “In a cooperative, there is no need to differentiate these quantities, because in the example of the maize cooperative for instance, people work together to harvest the ground. So there is no need to measure who works harder or who works less hard. What we measure is the number of hours worked by each person. For certain activities however we have a scale from 1 to 5… For example if a doctor comes here, the hour of work is worth more because he or she had to invest more to become a doctor… So the doctor would earn 5 Tupis per hour of work. This is a negotiation between both parties. So people in the group understand that some work is of higher value than other work. But you can never surpass the upper limit of five”. This creates a maximum level of income as well as a minimum level of income. “In a cooperative this system makes sure that no one earns more than five Tupis per hour, and no on earns less than one”.

Before visiting this community I was very sceptical about this ‘alternative money’ they had created. It turns out my mistake was the thinking cap I wore. I thought about this system with a purely capitalist mind frame, tending the concept to its limits, imagining thousands or millions of people participating in exchange fairs as an alternative to our capitalist system. But soon I realise that this is not meant to be a system that could be adapted to the entire world. Far from it, it’s a system that generates a form of capital in the monetarily dry pockets of excluded communities. It is a way for people to strive towards self-sufficiency, to generate self-esteem, to be creative, to live. Capitalism through free markets, despite its promise to spread wealth through the ‘Heineken’ economic theory of trickle-down economics, has failed to penetrate forgotten and excluded communities such as this one. But poor people are not sitting there passively, waiting for this external power to come and transform their lives. No, they are taking their destinies into their own hands and carving a path ahead.

This is not to say that the wider capitalist system has nothing to learn from the people of Paso do Peisce. On the contrary; this perspective reminds me what money was meant to be in the first place, its essence: A tool for ‘triangular’ exchange, a value of the work done. Their system encourages creativity and entrepreneurship on a fair playing field, with the objective of self-sufficiency and sustainability within their environment and community. They are striving to grow together, with an emphasis on self-employment. Even the workers in the cooperative are self-employed in the absence of an owner or manager reaping all the rewards. Yet their 1 to 5 scale allows for higher incentives for highly valued work, while maintaining a fairly flat pyramid, supporting a minimum wage worthy of a decent existence, and limiting the abuse of the law of supply and demand on the upside. 

12 - Radio do Gran Tijuca

Monica is so smooth and funky on that mike her vibe resonates in the homes, offices and cars of favela and barrio residents of Gran Tijuca. To my surprise she introduces me to her listeners and asks me to express my thoughts of Brazil. I talk of my instant love for the people, the beaches, the sunshine, the mountains, the nature and the whole Carioca world that has welcomed me to Brazil. I also talk of the unmistakeable segregation, which I equate with structural apartheid dating back to the 1500s. Monica grins and nods with acknowledgement as I express myself in Portunol, a terrible mix of Portuguese and Spanish. 

 

The Radio do Gran Tijuca, or RGT with the T hanging off the G on the logo, is a tangible product of the Agenda Social. Patricia from Ibase works closely with local communities and introduced me to Monica. I visit the radio station to find out how it helps integrate the barrio with the favelas. Monica explains before I even have a chance to ask:

 

“We started the radio because of the violence between different communities living here. Whoever lives in one community cannot speak to someone from another community. For example if I am from Borel I hate those who live in Casa Branca [and vice versa]. Not everyone but mainly the rival gangs. So many people living in different areas couldn’t speak to each other. So we wanted to create something that could be a point of convergence for these communities. So why a radio station? A radio station can talk about everything that is happening in those communities; the people living in the ‘asphalt’, in official areas, and those living in favelas, in the hills…  They conceived this radio, they created this radio, they built this radio with their own hands and they rose the funds that were needed...So this radio station converges all the ideas from the favelas of the hills, the street favelas and the official neighbourhoods.”

 

Monica explains how the radio helps create public politics: “Everyone who works here also works on a social project. For example I work on a work management project for women. Eduardo works on an environmental project. Miramar works for the church. So here in the radio we democratise information. Why? Because a woman at home, a woman without education, young people with no opportunities, they can learn through the radio. Through this radio. Because the big radios don’t speak the language of the people living in poorer communities. So we create public politics through the democratisation of information across the community radio. Informing, orienting, talking about violence in the family, talking about sexually transmitted diseases, talking about men’s health, talking about black culture, talking about various subjects that will stimulate growth of the poorest communities; those who don’t have access to quality information. Why? Because the large radios, the large medias, they talk about the dollar, they talk about the WTO they talk about NAFTA, they talk of MERCOSU, but people here don’t understand”.

 

I ask Monica if they accepted advertisers. She explains that the law prohibits them from any sort of commercial activity. In fact the government has recently closed down over 100 radio stations across the country because the large radio stations and media groups feel threatened by the proliferation of small, local radio stations. Monica explains, “In August or September a commission will go to Brazilia to personally re-vindicate the law [which prohibits the proliferation of small radio stations], so that us small people can express ourselves. This is part of an on-going campaign called ‘freedom of expression’. We are fighting against the steeling of our equipment and the aggression against our programmers”.

 

Market forces backed by government action stand in the way of the freedom of speech of communities all over Brazil. It seems that no matter what these communities try to do to organise themselves and integrate into mainstream society, they are faced with barriers that insure their exclusion. It just so happens that the poor and excluded in Rio’s favelas are predominantly black. But as we shall see, exclusion is not a racially conscious phenomenon, as it will quite happily capture anyone who happens to be left out. 

11 - Adequate housing?

This discussion of human rights was triggered off by Itamar’s claim that the investments needed in the favelas were people’s rights, not a favour. How serious is the problem though? Let’s face it there are unemployed and homeless people in most major cities in this world. What makes Brazil and Rio so special?

The fact is, not much. Cities with large sections of the population living excluded and marginalized lives is all too common these days, not the exception. It is estimated that 600 million people in cities all over the world now live in overcrowded and poor quality housing without adequate water, sanitation, electricity, drainage or garbage collection. And that’s just urban dwellers. Over 1 billion rural people live in equally bad conditions. In total, 2.4 Billion people do not have access to adequate sanitation services, and 1.2 billion people do not have access to drinking water[1].

I can’t even spend a day without access to sanitation. Why? Because when I get thirsty I neither want to walk for hours or risk my life with badly stored water; and when I need the toilet, I don’t particularly want my excrement floating down open sewers past my neighbours, spreading diseases along its way to the sea. I also don’t particularly want to find myself swimming in our collective excrement on a nice day out at the beach just because my government is incapable of treatment. 

If I live up North in the poorer areas, having to find a spot in the wilderness is not exactly consistent with my image of a technologically advanced global village. I also wouldn’t mind being able to walk out of my house on a rainy day and not find myself grappling with a river of mud. Switching a light bulb without having to either steel the electrons from the electricity companies who find it unprofitable to make that last connection to my poor household or paying a premium to some dodgy neighbour with a meter prepared to sell me electricity at a premium. 

That’s why these services have been deemed as our human rights. We can’t do without them and live a semi-descent life. Yet such huge numbers of people all over the world have to survive without access to services I literally take for granted. And these numbers are so huge they are hard to fathom.

Here in Brazil, the problem is highlighted by the sheer scale and inequality of the problem. Three million houses and twelve million people live without adequate access to water. Almost twenty three million households and ninety three million people do not have access to drainage[2]. Not statistics, but men, women and children, old people, brothers, sisters, fathers, mothers and grand parents. That’s what is meant by exclusion of the masses. In the case of adequate access to sanitation, over 57% of the total population of Brazil is being denied these basic human rights.

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[1] Social Watch reports by commitments. 2003. Privatising Human Rights – the impact of globalisation on access to adequate housing, water and sanitation

[2] Politicas de saneamento ambiental: Inovacoes na perspectiva do controle social. Statistic from ‘Cf. Alianca pesquisa e desenvolvimento (1995) – Page 26