Neither the Big Monopoly Bourgeoisie Nor the Rural Bourgeoisie! Against An Alliance With The Protesting Farmers In India

On November 26, 2020, nearly 250 million people went on strike for one day in India, making it what some have billed “the largest general strike in history.” The strike was a response to a change in labor laws. Previously factories employing more than 100 workers were required to get state approval before layoffs, but recently they have been given the power to lay off workers at will. 

One crucial detail set this “general strike” apart from historical general strikes, such as the Seattle General Strike of 1919 or the string of general strikes that seized tsarist Russia in 1905: the November 26th, 2020, General Strike in India had a definite predetermined duration of a single day, making it more of a “May Day in November” than a real militant assault on the bourgeoisie capable of transforming relations of force between antagonistic classes. In fact, “general strikes” of such a limited and ceremonial character ultimately serve as safety valves for diffusing worker grievances. 

The strike was organized by local coalitions of various political parties and trade unions. The most farsighted and militant sections of the strike’s participants raised the slogan: “Let’s not waste the precious weapon of the working class in such a ceremonial manner, let’s work for a militant strike of the working class!

Nearly coinciding with the worker’s strike, thousands of farmers have converged on the nation’s capital, New Delhi. The ongoing farmers’ protest is a response to three agricultural laws passed in June 2020 by the fascist Modi government:

1. The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, which expands the scope of trade areas of agricultural produce from Agricultural Produce Marketing Committee (APMC) mandis – i.e., government markets – to “any place of production, collection, and aggregation.” This bill allows private buyers to approach farmers directly, purchasing agricultural goods from them outside the APMC market system.

2. The Farmers’ Empowerment and Protection Agreement on Price Assurance and Farm Services Act, which provides a legal framework for contract farming, i.e., allowing farmers to enter into prearranged contracts with buyers, allowing corporations to enter directly into contract farming such that the corporation decides the variety of crop, the quantity produced, and a pre-fixed price.  

3. The Essential Commodities (Amendment) Act, which requires that imposition of any hoarding limit on agricultural produce be based on price rise. This law repeals the Essential Commodities Act of 1955, which regulated a limit on the stocking of essential commodities. 

The current protests have been fueled by the first two laws, which target a policy called the Minimum Support Price (MSP), first introduced during the 1960s-70s state-led “Green Revolution” organizing large-scale capitalist agriculture, largely in Punjab and Haryana.

The MSP is a price floor for 23 different crops (mainly wheat and unmilled rice), determined on a bi-annual basis by a government-formed committee. This committee calculates MSP based on the comprehensive cost of production, which includes all costs a farmer could potentially incur: labor and non-labor inputs, including depreciation of machinery and interest; family labor (calculated on the basis of the average daily wage in the agricultural sector); and rent. On this basis, the government-set MSP provides an enormous profit over the comprehensive cost, amounting to 3-5 times the average rate of profit in the overall economy! The Indian state agrees to procure these crops at this set price to safeguard profits for the farmer in the face of lower prices for the same goods on the open market.

Although the three agricultural laws passed in June do not explicitly discontinue or even mention the MSP, the first two laws directly target MSP. The first law targets MSP by allowing private corporate buyers to approach farmers directly, which means they may (or may not) pay for agricultural produce at prices below the MSP, effectively rendering the government-fixed price floor meaningless. The second law targets MSP by allowing corporate buyers to dominate contract farming, which entails sales of produce at pre-fixed prices that therefore bypass MSP. The protesting farmers fear that the effective dismantling of MSP will drive down prices.

The farmers’ protest has its own set of demands and grievances distinct from the charter of demands raised by the striking workers. The two movements should not be confused and treated as one and the same thing, the way filmmaker and musician Boots Riley does in a recent Instagram post, in which he writes: “It was a one-day demonstration of power, that shows what will happen if they go all the way. Farmworkers are still blockading all roads in and out of Delhi.” Such confusion has been nearly-universal on the US “left.” For example, in a recent interview, Richard Wolff offers the following gem of professorial “wisdom”: “Even more remarkable, [the striking workers] got together with a group of farmers’ organizations – and remember, India remains a very significantly agricultural organization – and so they got the farmers’ organizations together with most of the labor organizations.” This mixing up of the workers’ struggle and the farmers’ protests displays an utter inability to grasp the concrete situation in India.

The confusion of “left” commentators is made possible by – and in certain cases, stems from – the fact that the word “farmer” itself obfuscates the real class relations which constitute capitalist agricultural production in India. Not all farmers have the same interests or belong to the same class. A poor peasant family in Bihar that owns .25 hectares and uses the resulting crop as a meager supplement for the wages earned working on a larger neighboring farm – or by migrating to the city and working in a factory – does not have the same interests as a rich capitalist farmer in Punjab who employs migrant workers to harvest his 20-acre crop. 

Capitalism leads to class differentiation in the countryside. We must distinguish: 

agricultural proletarians with no land of their own, and who therefore have to sell their labor-power in order to purchase the means of subsistence; 

the rural semi-proletariat, who are either semi-owner peasants with insufficient land, and are thus forced to sell part of their labor-power, rent land from others, or engage in petty trade; or poor peasants, i.e., tenant-peasants who have little land and who cultivate side crops, selling part of their labor-power and borrowing funds from local usurers.

the rural petty-bourgeoisie, that is, owner peasants in an unstable position;

the rural bourgeoisie, who belong to the capitalist class and are either rich tenant farmers, capitalist farmers who own land but are directly involved in capitalist management (directly exploiting hired farmworkers), or kulak capitalist rentier landlords who live on rent collected from tenant farmers.

These different agrarian classes have sharply divergent economic interests. When analyzing the farmers’ protests, we must determine which class interests correspond to the demands raised by the mass movement. 

First, we should understand the agrarian class structure of India. Of the total rural population of 263 million, around 56% are agricultural workers who own no land and depend on wages alone to subsist. Of the remaining 44% of land-owning peasants, 67% own under 1 hectare, which effectively means: 

(1) that their entire agricultural product is consumed, i.e., not sold on the market; 

(2) that the bulk of their means of subsistence are purchased using wages, i.e., they are net purchasers of food;

(3) they are dependent on usurious loans from rich farmers and kulaks in order to purchase the means of production required to farm their plots. The combination of high interest, meager plots, and low productivity conspire to perpetually increase the indebtedness of the peasant until the land passes into the hands of the creditor and they are proletarianized.

Images of Sikh farmers from Punjab marching on Delhi in turbans have captured the naïve imaginations of US “left” spectators who can’t possibly fathom that these protesting farmers are, in fact, not all modest and noble peasants just trying to subsist in a backward country, but wealthy capitalist farmers, rentier landlords, usurers, and middlemen who prey on those who are in fact largely absent from the protests: agricultural wage workers, poor peasants, and lower-middle peasants.

In reality, the MSP benefits a minority of wealthy farmers in particular regions. According to studies by the Centre for the Study of Regional Development and by the National Institute of Public Finance in New Delhi, most small farmers do not have access to markets where government agents purchase crops at the MSP, as both storage costs and transport costs to distant government markets are prohibitive. The January 2015 Shanta Kumar Committee report determined that under 5.8% of agricultural households had sold unmilled rice or wheat to a government procurement agency: “The direct benefits of procurement operations in wheat and rice, with which FCI is primarily entrusted, goes to a minuscule of agricultural households in the country.” Unlike the rich peasants and kulaks, small farmers sell their surplus crops at prices well below MSP. 

The effectiveness of the MSP varies widely from region to region too. According to the Times of India, in Punjab, more than 95% of paddy growers benefit from MSP, whereas in UP, only 3.6% of farmers benefit.” Ultimately “only 12% of paddy growers [nationwide] benefit from procurement at MSP.” States like Punjab and Haryana have sufficient infrastructure to transport crops to government buyers. However, according to Reuters, in poorer states like Bihar, the government purchases produce from less than 2% of the state’s total production, and farmers sell their crops at 25-35% below the MSP. 

India’s poorest farmers who do not have access to MSP are often forced to sell their crops at discounted prices to their richer neighbors who have the means to transport produce to government markets, where they resell at the MSP. These parasitic middlemen profit from both the taxpayers who subsidize MSP purchases and the poor farmers whose crops they are reselling. These same rich farmers also often engage in predatory lending practices to their poorer neighbors, further squeezing them dry. The first two agricultural laws will finish off the monopoly of these rural middlemen.

Moreover, the fact that all workers and the vast majority of agricultural producers are net purchasers of subsistence foodstuffs alone means that MSP increases will adversely affect them – Why? The more costly food is, the more upward pressure is exerted on wages. Thus, since MSP is directly correlated to price increases of staple crops, then – everything else being equal – an MSP price increase means a decrease in real wages. Those farmers who rent or own a little land to supplement their income end up spending more money on food than they receive from their crops. Higher grain prices end up harming these farmers more than benefiting them. Although higher food prices will eventually tend to lead to higher wages, this process is a protracted and painful one: because wages do not immediately react to food prices, the working class will be squeezed by the higher food prices and suffer in the immediate term.

The direct relation between price increases and real wage declines means that the revolutionary working class must oppose the third agricultural law: hoarding raises the prices of essential goods, putting upward pressure on wages.

The struggle over MSP is a contest of economic and political power entirely internal to the bourgeoisie, setting the rural bourgeoisie against big monopoly capital. The agrarian bourgeoisie is interested in maintaining high prices for their products, whereas the big monopoly bourgeoisie wants a tool they can use as they see fit: insofar as they are involved in the marketing of produce and retail trade, they have an interest in higher prices, but they do not want prices to rise too high, because this could cause high pressure on wages.

Moreover, the relatively high rate of profit established by MSP means that there must be a transfer of value from non-agricultural sectors to the agricultural sector. This further harms the profits of the industrial bourgeoisie.

Out of this conflict, what political positions have emerged corresponding to the various social forces in Indian society? Big monopoly capital, with the support of the Modi government, wants to eliminate MSP. The rich farmers and kulaks, organized in various farmers’ associations, want to maintain MSP. Petty-bourgeois liberal reformers cook up policy proposals for the expansion of access to MSP to all Indian farmers. The confused petty-bourgeois left, which perpetually proves its capacity to dissolve reality in its own fantasies, fails to distinguish between rich farmer demands, poor peasant demands, and worker demands. Finally, the revolutionary working class and its friends oppose MSP as a reactionary demand.

Some of the rich farmers and kulaks have called for “mazdoor-kisan” (“worker-peasant”) solidarity. However, real solidarity is impossible between two classes with opposing interests. On what concrete basis could such an alliance be forged? Rich farmers and kulaks would never support poor farmers and laborers’ demands for measures like banning tenant farming or the implementation of labor protections for agricultural workers, including the 8-hour day, minimum wage, and social security.

Revolutionary forces must stake out an independent working-class position distinct from both that of the rich farmers and the big monopoly bourgeoisie. In particular, we support the poor farmers and agricultural wage-laborers’ distinct demands for a national employment guarantee (NEGA) and the extension of labor law to agricultural workers. The MSP subsidies should be invested in productivity increases and agricultural infrastructure, not in propping up rural rich farmers, kulaks, and middlemen. We firmly reject the third law, as it is a frontal attack on the working class. The other two laws are of no consequence to the working class and toiling masses of India. Rather than allow ourselves to be instrumentalized by our class enemies, revolutionaries in India and beyond must put forward demands that serve the interests of the working class and its allies in the line of revolution.