(introduction...)

The pattern of landownership in Bangladesh profoundly affects both the production and distribution of food. Although Bangladesh is often called a "land of small farmers," the reality in the villages is more complex. On the one hand, many villagers own no land at all and depend upon wage labor for their livelihoods. On the other hand are landlords whose holdings, though modest by American standards, are large enough to free them from the necessity of working in the fields.

A recent study commissioned by the United States Agency for International Development (AID) found that a "dichotomy between ownership of land and labor on it" is widespread in Bangladesh. Less than 10 percent of Bangladesh's rural households own over half the country's cultivable land, while 60 percent of rural families own less than 10 percent of the land. One third own no cultivable land at all, and by including those who own less than half an acre, the study concludes that 48 percent of the families of rural Bangladesh are "functionally landless." Pointing to the difficulties of collecting reliable data, the authors of the study note that these figures probably underestimate the actual extent of landlessness and the true level of concentration of landownership.¹

Based on their different relationships to the land, the villagers of Bangladesh fall into five basic classes:

· Landlords do not work on the land themselves, except sometimes to supervise their workers. Instead they hire labor or let out land to sharecroppers.

· Rich peasants work in the fields but have more land than they can cultivate alone. They gain most of their income from lands they cultivate with hired labor or sharecroppers.

· Middle peasants come closest to our image of the selfsufficient small farmer. They earn their livings mainly by working their own land, though at times they may work for others or hire others to work for them.

· Poor peasants own a little land, but not enough to support themselves. They earn their livings mainly by working as sharecroppers or wage laborers.

· Landless laborers own no land except for their house sites, and sometimes not even that. Lacking draft animals and agricultural implements, they seldom can work as sharecroppers, and must depend upon wages for their livelihoods.

A villager in Katni told us, "Without land, there is no security." Indeed, without land there is often no food. An International Labor Organization study reports that landless laborers consume only 78 percent as much grain as those who own over seven and one-half acres of land, despite the fact that the landless need 40 percent more calories because they work harder.² As we shall see, landownership not only determines who will have enough to eat, but also affects how much food is actually produced.

Not surprisingly, the small minority of rural families who own over half the country's farmland are, in the words of the AID study, "at the apex of the structure of power in rural Bangladesh; the political economy of the countryside is controlled by them."³ Land is the key to their power, power which in turn brings them control over other food-producing resources such as irrigation facilities and fertilizer. Since these agricultural inputs are often highly subsidized by the government, they are all the more desirable to the rural elite.

“Land, the ultimate source of wealth and power in rural Bangladesh, is becoming concentrated in fewer and fewer hands.”

Similarly, the large landowner is better able to receive low interest loans from government banks. His land serves as collateral, and he knows how to deal with the bank officials: how to fill out the necessary forms and when to propose a snack at the nearest tea stall. The large landowners also usually dominate village cooperatives which have access to government credit.

The rural poor meanwhile must turn to the village moneylender when they need cash, often paying interest rates of more than 100 percent a year. Not coincidentally, the moneylender and the large landowner are often one and the same person. Since Islam, Bangladesh's main religion, condemns the taking of interest, moneylenders ease their consciences through such simple expedients as buying a peasant's crop before the harvest-at half the market rate. To get credit small farmers frequently mortgage their land, forfeiting the right to cultivate it until they repay the loan.

The large landowners' control of food-producing resources- land, inputs and credit-allows them to appropriate much of the wealth produced in the countryside. As a result, they are able to buy out hard-pressed smaller farmers, driving them into the ever growing ranks of the landless. One study found that peasants who own less than an acre of land sell half their remaining land every yearn Land, the ultimate source of wealth and power in rural Bangladesh, is becoming concentrated in fewer and fewer hands.

Shaha Paikur: landlord, merchant and moneylender

Shaha Paikur lives with his four wives in a cement house in Dosutari, a village adjoining Katni. He is typical of the local merchants, for he is also a landlord and moneylender. He deals in jute, rice and mustard seed, and his warehouse is large enough to hold the produce of many local peasants as well as that of his own extensive landholdings. When he sells his jute, a caravan of 50 oxcarts carries it to town. Villagers often speculate about his riches, and some claim he buries gold in his courtyard.

Shaha Paikur's moneylending has earned him an unsavory reputation. "He began life with nothing but a sharp eye," recalls our neighbor Aktar Ali. "First he married an orphan girl who had some land, and then he worked himself up by moneylending, charging interest rates so high that borrowers could seldom pay him back. When we first came here, he took some of our land too. Now we have learned never to borrow from him; when in need, we borrow from our relatives.

"Shaha is clever, though. When a man falls on hard times, Shaha offers money. He acts so friendly, 'You have no rice? You have no clothes? Here, take this! You can pay me back at harvest time.'

"Men are weak. They know they shouldn't take his money, but they think: 'Let me eat today. Let the future bring what it may.' At harvest time Shaha is back, demanding payment in rice at half the market rate. When a man cannot repay, Shaha takes his land-he never lends money to a landless man.

"Our Koran tells us that moneylending is a great sin. In Allah's eyes, taking interest is as evil as murder. Let me tell you a story to prove it. Last year, when caterpillars attacked my rice crop, I tried all kinds of chemical sprays with no effect. Finally someone suggested the old method of writing a moneylender's name on pieces of paper and tying them to stakes at three corners of the field. You leave one corner open so the insects can escape. I wrote Shaha Paikur's name, tied it to the stakes, and in two days those caterpillars were gone! That is how much Allah despises the moneylender-even pests flee his name!"

Today the villagers are wary of Shaha Paikur's advances, and turn to him for money only in desperation. But Shaha has found other avenues to expand his fortune. He is now the biggest landlord in Dosutari, with holdings scattered in neighboring villages. At harvest time his agents ply the local markets and his warehouse fills. When the price is right an oxcart caravan takes his goods to town. He sells jute to the government and to bigger merchants, rice to the grain dealers in the nearest town, and mustard seed to a company which presses it for oil. With his profits he buys more land.

Although trade is not as morally repugnant as moneylending, many villagers resent Shaha Paikur as much for his merchant activities as for his usury. "I grow the jute in Shaha's warehouse," said one middle peasant. "Without me, where would he be? What do I get for my labor? Worn hands, aching muscles, and just enough to eat so that I can live to work another day. Meanwhile Shaha sits and eats, and counts his taka."

(introduction...)

Just as Bangladesh is often called a land of small farmers, so the country's agriculture is sometimes described as "subsistence farming." The implication is that the peasants grow barely enough to feed themselves, with little left over for anyone else. Once again, reality is more complex. Much of the wealth which the peasants produce in the fields is siphoned by large landowners, moneylenders and merchants. The hunger of Bangladesh's poor majority is intimately related to the ways this wealth is extracted and used.

Who Works, Who Eats?

Surplus is siphoned from poor peasants and landless laborers by the twin mechanisms of sharecropping and wage labor, production relationships which determine who works the land and who eats its fruits.

Sharecropping, according to a 1977 AID study, covers at least 23 percent of Bangladesh's farmland.¹ In Katni's vicinity, landlords and rich peasants generally cultivate about three-fourths of their land by means of sharecroppers and the remaining one-fourth with hired labor. The landowner and sharecropper normally split the crop equally, although in some districts the landowner often takes two-thirds.² The sharecropper usually must bear the costs of seed and fertilizer, so that in practice his share is really less than half the crop.

Although the rewards from sharecropping may seem meager, those of wage labor are even less. In Katni the standard wage for male laborers is about 33 U.S. cents per day, paid in a combination of rice, cash and a morning meal which insures that the laborer has enough strength to work all day in the fields. Women from poor families who work processing crops in well-to-do households earn even less-about 20 cents for a day's hard labor.

The number of landless laborers in Bangladesh is rising rapidly due to population growth and the displacement of small farmers. The dramatic rise in landlessness has not been matched by a rise in employment opportunities. As a result, in 1974 real wages for agricultural laborers had fallen to less than two-thirds of their 1963 level.³ As Dalim, a landless laborer, told us: "I earn two pounds of rice, one taka (about 7 cents) and a meal for a day's work. With that taka I used to be able to buy two more pounds of rice, with a little left over for oil, chills and salt. But today one taka won't even buy one pound of rice. Employers used to let their workers take a few free vegetables when they went home in the evening, but nowadays they aren't so generous. Times are getting harder for men like me."

With wages declining, it is becoming more profitable for the landowner to cultivate with hired labor than to give land to sharecroppers. The large landowners in Katni's vicinity calculate that wage labor only costs them one-fourth to one-third of the crop. They are slowly shifting more and more land to hired labor.

In some countries this shift has been associated with the "green revolution"-the introduction of new crop varieties, chemical fertilizers and irrigation-which by raising yields also makes wage labor more attractive to the landowner than sharecropping. But in Katni the main reason for the shift is not that yields are going up, but rather that wages are going down.

Poor peasants and landless laborers are caught on an economic treadmill. No matter how hard they run they keep slipping backwards. The siphoning of the surplus makes it almost impossible for them to save enough money to buy land of their own. Instead, illness and unemployment often force them to sell their remaining tiny plots of land and their meager household possessions (The Trials of A Poor Peasant Family, p. 27). Though they devote their lives to growing and processing food, they face perpetual hunger.

What happens to the surplus once it passes into the landowners' hands? If it were used productively, the suffering of the poor might not be entirely in vain. After all, any society must generate a surplus for investment if the economy is to grow. But in Bangladesh very little of the surplus finds its way into productive investment. Luxury consumption absorbs much of the income of the rural elite. For example, Nafis, a big landlord, bought himself a new Japanese motorcycle while we were in Katni. It cost him as much as a laborer working on his land would earn in 20 years.

Large landowners are reluctant to invest in agriculture, for farming is a difficult and risky business. They may buy more land, but this is simply a transfer of resources (usually from small farmers), which adds nothing to the nation's productive base. Even less of the surplus is mobilized for investment elsewhere in the economy through taxes or savings because the government does not want to tax the large landowners for fear of losing their political support, and the interest paid on savings deposits cannot compare with other more profitable uses to which the landowner can put his money. Trade and moneylending-both of which siphon surplus from the peasants while leaving the production process untouched-offer by far the most lucrative and easy avenues for investment.

The Market

Through the exchanges of the marketplace, merchants are able to siphon surplus from Bangladesh's peasants. Receiving low prices for the crops they sell and often paying high prices for the goods they buy, the peasants lose whether they enter the market as producers or as consumers. The transfer of wealth is often hidden by the seemingly impersonal movement of prices, but in Katni we found several examples which throw the relationship between peasants and merchants into sharp relief.

"In Bangladesh we call our jute ‘the golden fiber,’" said one peasant. But tell me, who gets the gold?"

Jute, the fiber used to make rope, burlap and carpet backing, is the main cash crop of Bangladesh's peasants and provides about four-fifths of the country's export earnings. After independence jute prices stagnated, while rice prices soared. As a result, peasants grew less jute and more rice, so that by 1975 jute acreage had shrunk to two-thirds of its pre-independence level. Worried about export earnings, the government announced a floor price for jute which it hoped would check the decline in production. Government purchasing centers throughout the country were instructed to buy jute from the growers for about 90 taka per maund (one maund is about 80 pounds).

One such purchasing center was located three miles from Katni. Nevertheless, the villagers sold their jute in the local markets for 60 taka per mound, two-thirds of the government rate. At this price jute was decidedly a losing venture. As the rich peasant Kamal complained: "I sold my jute for less than half of what it cost me to grow it!"

A visit to the local jute procurement center yielded some clues as to the reasons for the striking discrepancy between the official support price and the actual market rate received by the peasants. The purchasing center consisted of a half dozen large warehouse buildings which had once belonged to a West Pakistani company. The buildings were piled high with rough bales and loose mounds of the golden fiber.

The manager, a heavyset young man dressed in Western clothing, was happy to explain how the jute is graded and how to operate the baling press. But when asked where the jute in his warehouse came from, his reply was guarded: "We buy from the growers."

"At what price?"

"We pay the government rate, 91.50 take per mound."

"How curious. In the markets a few miles from here, the growers are selling their jute for only 60 taka."

"Oh, they must be selling to the merchants."

"Ah, the merchants. And do you buy from them too?"

"Yes, we buy from the licensed traders." The manager stressed the word "licensed," to emphasize the legitimacy of such transactions.

"The jute in this warehouse-did you buy most of it from growers, or from merchants?"

The manager began to look uneasy. "Well, actually we buy mostly from the merchants. You see, these growers only bring in eight or ten mounds at a time, so it is very inconvenient to buy from them. From the merchants we can buy hundreds of mounds at once."

The manager declined to elaborate as to why the growers are willing to sell so cheaply in the local markets, if they could receive the much higher government price simply by coming to the warehouse a few miles away. The villagers were less reticent. "If I bring in a cartload of jute," said one middle peasant, "the warehouse people say, 'Today we are closed-come back tomorrow.' So my time has been wasted. If I return the next day they will have another excuse: 'We've already bought our quota for the day,' or 'We have to wait for funds from Dacca.' We can never sell our jute to the government."

Why do the warehouse people turn the peasants away? Our middle peasant friend explained: "We sell our jute in the market at 60 taka. The merchants then sell it to the government at 90 taka, making a 30 taka profit on each mound. They share this profit with the warehouse manager, giving him maybe half. So of course he won't buy from us!" Besides paying kickbacks, the merchants are said to pay the warehouse manager a monthly retainer in order to ensure his cooperation. The manager accordingly buys only from those who make it "convenient" for him to do so. Perhaps he does buy directly from a few growers-local landlords who make suitable arrangements.

In previous years jute prices in the local markets had been somewhat higher, because much jute was smuggled to India and this demand had helped to keep prices up. But in 1975, following the assassination of Sheikh Mujib, the political connections which had protected the smugglers unraveled and the illegal flow of jute across the border slowed to a trickle. In collusion with the government authorities, a few merchants were then able to strengthen their control over the local jute market, pushing prices to the abysmally low level of 60 taka per mound.

"In Bangladesh we call our jute 'the golden fiber,' " said one peasant. "But tell me, who gets the gold?"

While some merchants buy cash crops from the peasants, others sell various goods to them. No villager is entirely selfsufficient; all rely on the market to meet some of their needs. Landless laborers and poor peasants must buy food, everyone has to buy salt and cloth, and those who can afford them purchase such items as medicine and footwear. The prices the villagers pay are often high, in part because of hoarding by merchants.

Sometimes hoarding is a reaction to genuine scarcities, but other times it is a means to deliberately raise prices. Merchants not only manage at times to control the supply of a particular good within a given locality; on occasion they are able to corner a market throughout the country. For example, in the autumn of 1974 a cartel cornered the market for salt in Bangladesh. The price rose to 50 times its normal level, and salt riots broke out in major towns. For two weeks the merchants who hoarded the nation's salt reaped tremendous profits. Then they loosened their grip, and prices returned to normal.

Most hoarding is less spectacular, and it is often hard to say where natural scarcities end and artificial ones begin. For example, rice prices are generally lowest at harvest time and highest just before the next harvest. This predictable fluctuation makes speculation in rice attractive to merchants. If they hold stocks in anticipation of rising prices, this in itself helps to lift prices. Landless laborers and poor peasants, who rely on the market for much of their food needs, must pay the price. Middle peasants often lose coming and going: they sell their rice cheaply at harvest time because they need cash for consumption, investment in the next crop and repayment of debts; a few months later they have to buy rice at inflated prices.

The rice trade was not particularly lucrative in the 1960s, but after independence this changed. In 1974 the price of rice climbed to 10 times its pre-independence level. Peasants were particularly vulnerable in parts of the country where floods had damaged crops. As prices rose, many sold their animals, their land and their household possessions in order to buy rice. The poorest, with nothing left to sell, came to the towns in search of work or relief. An estimated 100,000 people starved to death.

A villager recalls: "Lalganj (a town five miles from Katni) became a town of beggars. Whole families were living, sleeping and dying in the streets. Each day there were new bodies along the roadside."

Officially, the government blamed the famine on floods, but many observers believed that hoarding by merchants and a breakdown in government administration were responsible for turning a manageable, localized shortage into a catastrophe. According to an AID official in Dacca: "The food supply was there; it just didn't get to the right people."

The 1974 famine brought terrible suffering to many people, but to some it brought profit. The merchants who hoarded grain were not the only ones to benefit. Moneylenders did a brisk business, and large landowners were able to buy land cheaply from their poor neighbors. In the hardest hit areas land registry offices had to stay open late into the night to handle the record sales.

The villagers are well acquainted with many of the merchants who profit at their expense. The men who buy their jute, for example, are local landlords who have diversified into trade and moneylending (Shaha Paikur: Landlord, Merchant and Moneylender, p. 19). A pyramid of trade extends above these local merchants to regional, national and sometimes even international economic interests. At the base of this pyramid are the peasants. They sum up their situation with a simple phrase: "The merchants drink our blood."

The trials of a poor peasant family

Abu and Sharifa live with their six children in a one-room bamboo house with broken walls and a leaky straw roof. They are poor peasants, and year by year they are becoming poorer.

"I wasn't born this way," says Abu. "When I was a boy I never went hungry. My father had to sell some land during the '43 famine, but still we had enough. We moved to Katni when he died-my mother, myself, and my three brothers. We bought an acre and a half of land. As long as none of us brothers married that was enough, but one by one we married and divided the land."

''I was young," recalls Sharifa, "and I worked very hard. I husked rice in other women's houses to earn money, and finally I saved enough for us to buy another half acre of land. But my husband's mother was old and dying, and he wanted to spend my money to buy medicines for her. He threatened to divorce me if I didn't give him the money, so I gave in. The money was wasted-she died anyway-and we were left with less than half an acre. Then the children came. Our situation grew worse and worse, and we often had to borrow to eat. Sometimes our neighbors lent us a few taka, but many times we had to sell our rice to moneylenders before the harvest. They paid us in advance and then took the rice at half its value."

"People get rich in this country by taking interest," Abu interjects bitterly. "They have no fear of Allah-they care only for this life. When they buy our rice they say they aren't taking interest but really they are."

"No matter how hard we worked," continues Sharifa, "we never had enough money. We started selling things-our wooden bed, our cattle, our plow, our wedding gifts. Finally we began to sell the land."

Today Abu ant Sharifa own less than one-fifth of an acre of land. Most of this is mortgaged to Mahmud Hazi, a local landlord. Until Abu repays his debt, he must work his own land as a sharecropper, giving Mahmud Hazi half the crop. "I can't even earn enough to feed my family," he says, "let alone enough to pay off the mortgage."

Sharecropping is difficult. "When I work for wages," he explains, "at least we have rice, even if it's not enough to fill our stomachs. But I don't eat from my sharecropping until the harvest. To plow the land I have to rent oxen from a neighbor, plowing his land for two days in exchange for one day's use of his animals. In this country a man's labor is worth half as much as the labor of a pair of cows !"

When Sharifa can find work husking rice, she usually receives only a pound of rice for a day's labor. Often she cannot find employment. ''If we had land I would always be busy," she says. "Husking rice, grinding lentils, cooking three times a day. Instead I have nothing to do, so I just watch the children and worry. What kind of life is that?" She unwraps a piece of betel nut from the corner of her sari. "Without this we poor people would never survive. Whenever I feel hungry I chew betel nut and it helps the pain in my stomach. I can go for days without food. It's only worrying about the children that makes me thin."

Soon after our arrival in Katni, Abu fell ill with a raging fever. For a month he was unable to work. Sharifa husked rice in other households and their children collected wild greens, but finally hunger and the need to buy medicine forced the family to sell another bit of land: threehundredths of an acre. They slipped a little further towards total landlessness.

Six months later, in the lean season before the autumn harvest, Abu and Sharifa could not find any work. Again the family faced a crisis. "Sharifa will tell you she lost her gold nose pin," a neighbor whispered to Betsy. "It's a lie. If she had really lost it, her husband would be beating her. He sold it in the bazaar. How else would they be eating rice tonight?"

The money from the nose pin was soon gone, so one sunny afternoon Abu cut down the jackfruit tree beside his house. He had planted it four years earlier, and in another year it might have borne its first fruit. By selling it as firewood in town he hoped to get 25 taka. Sharifa and a young son watched as he dug up the roots, which he could also sell as fuel. ''Do you know what it is like when your children are hungry?" asked Sharifa. ''They cry because you can't feed them. I tell you, it's not easy to be a mother."

She brushed a strand of hair from her forehead and unconsciously fingered the small twig stuck in the hole where her nose pin used to be. ''Why do you sit here listening to our troubles? When people in this country are happy and their bellies are full, they won't listen to tales of sorrow. They say, 'Why are you telling me this? I don't want to hear.' "

Abu nodded. "Our religion says that the rich man should care for the poor man. He should ask him whether he has eaten. But in this country a rich man won't even look at a poor man."

Sharifa gazed into the fields and mused aloud: "They say that Allah makes men rich and poor. But sometimes I wonder-is it Allah's work or is it the work of men?"

(introduction...)

From the pages of economic texts and the documents of government planners the familiar theme often emanates that inequalities in income distribution are economically efficient. We are led to believe that the concentration of wealth in the hands of a few leads to higher savings and investment, which ultimately benefits society as a whole. But a look at the realities of rural Bangladesh has already revealed that the surplus the elite extracts from the peasants is not invested productively. The squandering of wealth which could potentially finance development is only one side of the inefficiency of inequality in Bangladesh. The other side is the chronic underutilization of existing resources: land, labor and water.

Bigger isn't Better

In Bangladesh the concentration of land in the hands of a few large farmers is a major cause of low agricultural productivity. Several studies indicate that in Bangladesh, as in many countries, small farms have per acre yields equal to or higher than those of large farms. As one report noted: "This may be considered remarkable in view of the heavy discrimination against marginal farmers as far as distribution of modern inputs is concerned."¹ Even though they reap the advantages of subsidized fertilizer, irrigation and credit, Bangladesh's large farmers still don't produce more than their smaller neighbors!

The reasons for this discrepancy are not hard to fathom. The large landowners tend to cultivate their lands less intensively than small owners. The small landowning peasant, who tills the soil with his own hands, knows that his work determines how much he and his family will have to eat. He invests more labor in his agriculture, and strives to use every bit of land and every drop of water to its utmost. The large landowner's incentive is not so great, and the incentive of the sharecroppers and wage laborers who actually work his land is often minimal.

The sharecropper knows that half the fruits of his labor will go to the landowner, so he saves his extra effort for the little land he owns himself. He has little incentive to invest in agricultural inputs, not only because the landowner will reap half the benefits, but also because he knows that next year he may not be around to enjoy the returns to his investment. According to the AID land survey, more than 70 percent of all sharecroppers have cultivated their tenant lands for a period of three years or less. This leads the authors to conclude, "It may be reasonably assumed that with such a high turnover in tenant-operated areas that tenants might be less than enthusiastic concerning the need to invest in improvements in such land-including the use of fertilizers having residual impact in succeeding years."² The landowner also displays a marked reluctance to invest in improvements, for he has easier ways to make money. The AID study found that less than one percent of landowners supplied any inputs to their tenants.³

If the large landowner cultivates with hired labor, he may be more likely to invest in inputs, but once again yields are likely to be lower than if the same land were owned and tilled by a smaller farmer. Hired laborers have even less incentive to produce than sharecroppers: they worry about their wage, not about the landowner's yields. And since the landowner must pay for their labor, he uses it sparingly. Moreover, large landowners are often poor farm managers. They usually disdain the dirty work of farming, preferring instead to devote their entrepreneurial talents to such refined activities as trade and moneylending.The villagers of Katni described the incompetence of one big landlord: "Nafis understands nothing about farming. He seldom even goes to the fields. His workers cheat him all the time, and laugh at him behind his back."

Since small farmers cultivate their land more intensively, they also tend to make more efficient use of credit and agricultural inputs-when they can get them. But most of these resources flow to the large landowners, by virtue of their political power. Commenting on the Bangladesh government's latest rural credit scheme, the World Bank notes: "As usual for such programs, the small farmers demonstrated a better repayment record but did not get a large share of the credit outlays."⁴

While in Katni, we had the chance to see the government's agricultural extension service in action. One day the village children ran to tell us that a "foreigner" had come to see us. It turned out to be the local agricultural extension agent. With his immaculate clothing and upper-class accent, the children were sure he was not a Bengali. The agent's job was to give technical advice to farmers, but he was a stranger to the poor and middle peasants of Katni. We learned that his main role was simply apportioning subsidized fertilizer among the local landlords. These realities are what the AID study calls "institutional impediments" to the dissemination of new agricultural technology.

In Japan and Taiwan, the groundwork for a highly productive agriculture was a far-reaching land reform, which put control of food-producing resources into the hands of small farmers. In the absence of such a land reform, to imagine that one could redirect credit, inputs and agricultural extension services to the small farmers of Bangladesh is wishful thinking. Moreover, even if by some stroke of political magic one could reorient development programs in favor of the poor and middle peasants, this would still leave out the large and growing numbers of landless.

Underemployment of Labor

The chronic underemployment of Bangladesh's- landless and poor peasants represents a terrible waste of the country's greatest resource: the labor of its people. The demand for agricultural labor is highly seasonal-in the peak periods of harvesting, weeding the spring rice and transplanting the rainy season rice, most of the poor can find work. But between these periods they are often unemployed, with no income at all. Taking these seasonal fluctuations into account, a United Nations study set the unemployment rate in rural Bangladesh at a staggering 42 percent.⁵ For many, this figure translates into chronic hunger and even starvation (The Death of A Landless Laborer, p. 36).

Massive underemployment means that millions of people cannot afford to buy basic consumer goods. This lack of what economists call "effective demand" is in itself a cause of economic stagnation. Industry cannot grow without a market, but families who can hardly afford to eat are not about to become consumers of even basic items such as footwear and soap. Indeed, their lack of buying power may act as a brake on food production too. Discussing the prospect of rising unemployment, a cable from AID's Dacca mission states, "These findings in turn cast doubt upon the feasibility of current foodgrain production strategies, implying as they do a general reduction in the level of demand."⁶

The rural poor of Bangladesh represent a huge, untapped work force for labor-intensive agricultural and industrial projects. Mobilized for development, they could be transformed from a drain on the nation's economy into a powerful asset. Yet despite the fact that labor-intensive rural works projects are frequently endorsed as a key to development in Bangladesh, efforts to implement such projects run aground on hard political realities; the government has other priorities. As the AID cable notes: "The government's Rural Works Program is widely reported to have been in a state of deterioration in recent years owing to a variety of management difficulties. "⁷

For their part, the rural poor have no incentive to undertake such projects as long as they are deprived of the land which would be improved by their labor. Even if more rural works projects were instituted, the extent to which the landless would benefit is open to question. As an AID study points out:

Such projects (e.g., the building of a farm to market road) provide income to rural workers for a specified period, but do nothing generally to change the fundamental economic conditions that produced unemployment in the first place. At the same time, such projects tend to provide long-term benefits to landholders who, in this example, use the road to gain access to local markets.⁸ In the same vein, the World Bank warns that the scope for reducing unemployment and poverty through rural works projects "would be offset by the inequitable distribution of secondary benefits of the program."⁹ As one experienced Bank official told us, "It's hard to see much we can really do for the landless." Hard, that is, under the present inequitable social order.

Water, Water Everywhere, But...

The present structure of landownership in Bangladesh results in the underutilization of another precious agricultural resource: water. Although Bangladesh has vast surface and ground water resources, only 12 percent of the country's cropland is currently irrigated. Irrigation would bring tremendous production increases in the dry winter season, would insure the regular spring and monsoon season crops against drought, and would allow earlier plantings which reduce the risk of flood damage. But today the uneven distribution and fragmentation of landholdings blocks the cooperative effort needed to harness Bangladesh's great water resources.

Although it would be a formidable engineering challenge, there is certainly great potential for taming Bangladesh's rivers through construction of dams, embankments and canals. These could provide not only irrigation but also much-needed flood control and drainage for millions of acres. Bangladesh has no shortage of manpower to undertake these tasks but, as we have seen, the mobilization of this labor is almost impossible under the present social order. Moreover, the fact that land is fragmented into many individual holdings poses great difficulties for any such scheme. For instance, who would decide whose precious plots would be sacrificed to the construction of canals and channels?

“The chronic underemployment of Bangladesh’s landless and poor peasants represents a terrible waste of the country’s greatest resource: the labor of its people.”

Indeed, fragmentation and unequal distribution of landholdings today undermine even modest efforts to provide irrigation with low-lift pumps and tubewells. For example, a deep tubewell can irrigate 60 acres of land. But even the biggest landlords seldom own so much in a single block-their holdings are scattered here and there. So to use such a well to its full capacity requires cooperalion, which is hard to come by as long as a few large landowners control irrigation resources for their own benefit. An AID cable points to "the well known fact that pump group cooperatives exist only on paper or are otherwise captured by the large landowners."¹⁰

The World Bank, which has financed several tubewell projects in Bangladesh, has found persistent "organizational problems arising in conveying the water to the farmers' fields." ¹¹ They are pouring an extra million dollars into one deep tubewell project to facilitate the digging of water channels. "You or I could go out there and dig those channels," one Bank official admitted. "The problem is not that the farmers don't know how to dig ditches, but that they don't want to." In rural Bangladesh political realities not only make large-scale irrigation works impossible-even the use of a single tubewell is problematic!

The Priorities of the Elite

There is another important dimension to the inefficiency of inequality in Bangladesh. The priorities of the government reflect the interests of a narrow elite rather than the needs of the poor majority. For instance, expenditures for "defense, justice and police" have risen from 20 percent of the revenue budget under Sheikh Mujib to 30 percent under the present regime Major-General Ziaur Rahman.¹² Government leaders meanwhile make innumerable pronouncements about the importance of attaining agricultural self-sufficiency. But although agriculture generates almost 60 percent of the Gross National Product (GNP) and employs over 80 percent of the labor force, its share of the government's development budget is scheduled to drop from 30 percent in 1976-78 to 25 percent in 1979-80.¹³ And the little money devoted to agriculture will mainly be used to subsidize the price of fertilizer.

Agriculture suffers not only from a lack of funds, but from a lack of commitment on the part of government officials. The World Bank notes pointedly; "Examples of the few countries which have been successful in rural development (e.g. China, Taiwan and Korea) show that government officials have diligently and persistently worked with local people."¹⁴ In Bangladesh, even the most optimistic foreign aid officials admit this diligence and persistence in rural development is hard to come by. The concept of public service is alien to most members of Bangladesh's elite, who look upon the poor majority with disdain. For them, villages are to be escaped, not to be served.

In fact, the main development which has taken place in Bangladesh in recent years is the development of the elite. Bangladesh's most pressing employment problem is providing work for the millions of landless rural people, but as the World Bank reports, "The only sector which has been booming in terms of employment is public administration."¹⁵ While real wages of landless laborers are plummeting, the government recently increased the salaries of civil servants by 20 to 25 percent.¹⁶

Although Bangladesh suffers from a shortage of skilled workers, ranging from doctors to mechanics, the government is now encouraging such workers to go abroad so they will send home foreign exchange. (One reason the government needs foreign exchange is to repay foreign aid loans.) At present more than 3000 Bangladeshis migrate to the Middle East each month.¹⁷ More of Bangladesh's senior nurses now work there than in their own country! The New York Times reports from Dacca that the mass exodus of skilled labor is "so serious that the Agency for International Development has all but stopped sending Bangladeshis to the United States for training, even though specialized skills are badly needed here to promote development."¹⁸ Exporting labor which is needed at home is like exporting food when people are hungry: resources go where the profits are highest, not where the needs are greatest.

Hunger in Bangladesh is neither natural nor inevitable. Its causes are deeply rooted, but they are man-made. The surplus siphoned from the peasants is squandered; land, labor and water are underutilized; and, at the national level, financial resources and skilled manpower are allocated for the benefit of a few rather than for the well-being of the majority Although we have painted a bleak picture, Bangladesh's future is by no means hopeless. Identifying the barriers to development is an important first step to formulating a positive alternative.

The death of a landless laborer

''Between the mortar and the pestle, the chili cannot last. We poor are like chills. Each year we are ground down a little more, until there is nothing left of us."

These are the words of Hari, a Hindu landless laborer who lived in Katni with his wife Komla, their three young children, and a niece whose parents died in the 1974 famine. Their house consisted of a packed mud floor, a sagging straw roof and walls made of a few dried palm leaves hanging from bamboo poles. Inside there was no furniture-the family slept on burlap bags, covering themselves with straw on cold winter nights. Hari did not even own the land on which the house was built.

Hari's father once owned six acres, enough land to support his wife and five sons. He sold some land to pay for his sons' weddings, but most of it was stolen by powerful Muslim landowners who rose to fill the vacuum left by the departure of the Hindu zamindar. Through fraud, force and moneylending, men like Shaha Paikur wrested Hari's father's land.

At the time of his death, Hari's father owned only one acre of land, which was then divided among the five brothers. Hari's one-fifth of an acre was not enough to feed his growing family, so he worked as a wage laborer and Komla husked rice in other households. Little by little, Hari sold his land to buy food, clothing and medicine and to repay his debts. By 1971 the land was gone, but Hari and Komla still had a few objects of value-a wooden bed, and a house with solid walls of woven bamboo mats. Then came the independence war.

The Hindus of Katni had to flee to India to escape the ravages of the Pakistani army, for whom any Hindu was fair game. In the crowded refugee camps across the border, two of Hari's brothers died, probably of cholera. In retrospect, Hari said he had more to eat in the camps than he did when he returned to Bangladesh. Still he told us, "If we Hindus ever have to Bee again, I'll just stay here. Everyone has to die once, and I would rather do it at home."

When Hari and Komla returned to Katni after the war, they had nothing. Their house had been looted; even the walls had been stolen. Despite the promises of government officials, they received no reliefno food, no clothing, no blankets. Echoing poor people throughout Bangladesh, they maintained that corrupt local leaders sold these relief goods on the black market. Hari and Komla struggled to make ends meet, but rising rice prices cut into the value of their already meager wages.

In the autumn of 1974, when rice sold at 10 times its preindependence level, Hari and Komla came face-to-face with famine. "I had no work, and we had nothing to eat," Hari recalled. "We begged from house to house, but no one had much to give. One day when l went to town, I saw hundreds of poor people living in the streets. The gutters were filled with their excrement. What an awful stench! People sat outside restaurants waiting for the cook to throw out a few scraps. I saw people fighting over the intestines of a chicken. I saw people selling their children in the bazaar."

"Later the government set up a gruel kitchen in the town. One day I went with my brother Kirot. We waited all day, and each got one roti (a piece of unleavened bread). Who can live on one roti a day? I decided I would rather die here than in town. My wife and I collected wild greens and roots, and when we weren't looking for food, we slept. When the children's cries woke us, we went out again to search for food. Kirot and his wife died at the gruel kitchen. That's why their daughter Gopi lives with us now."

The famine had passed by the time we arrived in Katni, but Hari and Komla were still living dangerously close to the margin. During the planting and harvesting of the crops they could find work, but in the slack seasons they often went for days without a decent meal. Hari's health slowly deteriorated. He was trapped in a vicious cycle: without work he could not eat, not eating made him weak, and because he was weak, employers did not want to hire him.

In the lean season before the autumn harvest of 1975 rice prices were unusually low because hoarders had unloaded their rice stocks in the uncertainty following Sheikh Mujib's assassination. But the low prices did not help Hari, who had no cash. Komla spent hours foraging for edible weeds and roots, while Hari searched from village to village for work. They sent their children to the town bazaar to collect the grains which spilled around the rice merchants' stalls. As the cool, damp nights of winter set in, Hari caught a cold. His body, weakened by hunger, could not resist it. Within a week he was dead.

Komla's face was knit in a permanent expression of despair. Villagers promised her work after the harvest, and some gave her a little rice when she begged at their houses, but their generosity was limited by their own poverty. Komla worried about her sari, which was falling to pieces. "This sari will last another month, no longer," she told Betsy. "What will I wear after that? How will I leave my house to look for work? My husband never earned much, but at least he shared my worries. Now I have to face the world alone."

Komla realized she would share the same fate as the other beggar women who passed through Katni-a life of unrelenting hunger. ''People say I will die like my husband, like his brothers and their wives," she confided. "But until then I must try to feed the children."

6. What is the alternative?

With fertile land, abundant water and and vast reserves of natural gas, Bangladesh clearly has the potential to afford all its citizens a decent livelihood. The basic obstacles to realizing this potential are social, not technical. True, agricultural output can be increased somewhat by providing more inputs, more credit and better extension services, and by raising prices to give large landowners more incentive to produce. But this will not help those who have no land on which to grow food and are too poor to buy it; in fact, such production increases may actually result in greater hunger by accelerating the concentration of land in fewer hands. Moreover, the inefficiencies inherent in an inequitable social structure will continue to seriously limit the scope for increasing production.

Social Reconstruction

What is the alternative to the needless hunger of Bangladesh's poor majority? Only a far-reaching social reconstruction can break the fundamental barriers to increased production and at the same time ensure that the poor majority shares in the fruits of development. The key to such a reconstruction is land reform. If a ceiling of 10 acres per family were perfectly implemented and the excess land redistributed among the landless, each family would receive less than 0.4 acre. A more drastic four-acre ceiling would yield enough surplus to provide each landless and near landless family with a total of 0.86 acre.¹ But even if such a radical reform were implemented, over time lands would be subdivided among children, and for one reason or another some peasants would end up selling out to others, so that eventually a landless group would reemerge. This suggests that land reform, though necessary, would not alone be sufficient to overcome the roots of poverty in Bangladesh. Access to the land is only half of the answer to the needs of the rural poor the other half lies in the cooperative use of the land.

Cooperation in agricultural production would enable the peasants of Bangladesh to undertake self-help development projects which remain impossible as long as agriculture is organized on a fragmented, individual basis. Through labor-intensive construction of irrigation facilities, drainage canals and embankments, the peasants could collectively begin to master the forces of nature in the face of which single individuals are powerless. As the people of our village remarked: "One bamboo alone is weak; many bamboos lashed together are unbreakable." The certainty that the peasants themselves would reap the fruits of their labor, rather than the village landlords, would release tremendous popular energy and initiative.

Western experts tend to disparage such an alternative approach to development. The authors of the AID land study, for example, dismiss this possibility:

It is difficult to imagine the people in the countryside (even the landless), committed as they are by tradition to venerate individual rights in land, being amenable to joint farming activities of any kind. Only under circumstances in which the state was able and willing to employ extraordinary coercive power can such joint farming cooperatives be envisaged in Bangladesh. Therefore, for reasons that are practical rather than ideological, joint farming cooperatives do not appear to be a viable option within a general program for rural development.²

But are joint farming cooperatives in Bangladesh really such a farfetched idea? Certainly no one should underestimate the difficulties involved in such a major social transformation, but one must distinguish between difficulties and insurmountable obstacles.

The assertion that the peasants of Bangladesh are committed by tradition to "venerate individual rights in land" is an overstatement. Land ownership in Bangladesh has been far from stable. After 1947, the breakup of the zamindari system resulted in the transfer of ownership of three-fourths of the country's land to new hands.³ It was through such transfers that many of the landlords in Katni's vicinity acquired their extensive landholdings. The peasants recall this with bitterness; they hardly venerate the landlords' rights to the land.

While we were in the village, we witnessed the constant turnover of land, the buying and selling through which small farmers are being gradually dispossessed. Certainly, land is more than just another commodity to the peasants of Bangladesh, for land ownership can spell the difference between survival and starvation. But this is a question of economic security, not of quasi-religious attitudes.

Furthermore, the notion of cooperation was far from alien to the peasants of our village. Many small landowners worked together in informal mutual aid groups. Five or six peasants would join together during the plowing, transplanting or weeding of the fields or at harvest time, working one day on one man's land, the next day on another's and so on. Mostly this was done by middle and poor peasants, but sometimes landless friends would join the group, being paid by whomever owned the land that was worked on a particular day. The villagers explained, "When you work alone, time passes slowly. Working in a group, we talk and sing and the work gets done much faster."

A transition to joint farming in Bangladesh would necessarily pass through stages, perhaps building at first upon the existing tradition of mutual aid groups. It would have to rely on the peasants' own initiative-it could never be imposed upon them. Once convinced that change was possible, the landless and small farmers could be expected to actively support land redistribution and the growth of agricultural cooperation, for these would bring them improved living standards and greater control over their lives and labor.

Rich landowners would probably be less than enthusiastic about such changes, and force might be necessary to break their resistance. Coercion and the violence of state repression, as well as the more subtle violence of starvation, are today routine in Bangladesh. What would be "extraordinary" about any coercion involved in a social reconstruction would not be its scale but rather that it would be employed against the wealthy minority, instead of against the poor majority.

Who could exercise the necessary force to bring about a basic land reform ? Only the poor themselves, whose numbers give them strength. The act of joining together to bring about social change would help to set the stage for cooperation in agricultural production itself. Industry as well as agriculture would benefit from such a social reconstruction, since those who today are too poor to buy consumer goods would be transformed into a vast internal market.

To suggest that the road to development in Bangladesh lies in this direction is not to say that the "Chinese model" can or should be exactly duplicated. The people of each country must chart their own path of development. What the Chinese have shown is that change is not impossible and that starvation is not inevitable. Development is a great challenge, and one which can only be met through the mobilization of the talents and energies of the poor themselves. It will take patience, organization and dedication. There are no magic words and no instant solutions.

“Only far reaching social reconstruction can break the fundamental barriers to increased production and at the same time insure that the poor majority shares in the fruits of development. The key to such a reconstruction is land reform.”

Too Optimistic?

Some might argue that this scenario is too optimistic. A World Bank staff member told us, "The poor people I knew would not be able to mobilize themselves for development or revolution. In Latin America maybe, but the poor in Bangladesh are too submissive and ignorant. "

Privately, however, many aid officials view a far-reaching social reconstruction in Bangladesh not as a wishful dream but rather as a sad inevitability. AID's Dacca mission states in a 1978 memorandum: "More pessimistically, we foresee that the time will come when the organization of productive forces will have to be radically transformed in such a fashion that rural people will only be able to find security, employment and income in some form of communal agriculture."⁴

Are Bangladesh's peasants too "submissive and ignorant" to see the need for change? Bangladesh has a long history of peasant rebellions.⁵ In 1947 and 1971 the peasants saw that political power can and does change hands. But to struggle against the rural elite is to invite retaliation. The large landowners are backed when necessary by the force of arms. Peasants are not by nature passive; on the contrary, they are among the most energetic, hardworking people in the world. The problem lies not in their ability to act, but in the powerful forces that prevent them from acting.

The rural elite which rules the countryside is not the only obstacle to change. The urban elite which controls the government also benefits from the present social order and wishes to preserve it. Moreover, in Bangladesh most members of the urban upper and middle classes are first or second generation city dwellers with roots still in the villages. The urban and rural elites are not only natural allies, they are also blood relations. Government patronage to the large landowners, in the form of subsidized inputs, credit and funds for local public works projects, serves to strengthen this alliance. The cross fertilization of the two elites has recently taken a new twist, as reported by The Washington Post: "Many of the land transfers recently recorded are to army officers, senior bureaucrats and police."⁶

There is no natural barrier to the satisfaction of the basic human needs of Bangladesh's people. But there is the man-made barrier of a social order which benefits a few at the expense of many. In the cautious language of an AID report, "A local government may lack the political will to implement needed agrarian reforms, however obvious the need for such reforms."⁷ No such shortage of political will however is likely to handicap the government when it comes to crushing any challenge to the vested interests it protects.

Just as Bangladesh's large landowners rely on the backing of the elite-based government, so the government relies on financial and logistical support from wealthier countries. Each year the United States government and U.S.-supported multilateral institutions provide hundreds of millions of dollars of foreign aid to the Bangladesh government. If we as Americans are concerned about the needless hunger of Bangladesh's poor majority, our first duty is to understand the effects of the aid given in our name.