has shown that agriculture as socially “produced nature” in many corners of the world cannot be thought of without taking the transformative, and often state-backed, powers of globalized financial relations into account. The production of settler-colonial agrarian landscapes in contemporary land rush frontiers such as Aotearoa New Zealand cannot be discussed without considering the far-flung financial networks that linked “the city” (metropoles such as London) and “the countryside”. If space permitted it, similar accounts could be provided for places such as the United States, Australia, Brazil, Canada, Uruguay or South Africa, where “within three generations, during the nineteenth century, some of the best lands [were] secured, surveyed, apportioned, registered and drawn into finance capitalism” (Weaver 2003: 89). Russian economist Alexander Chayanov came to a similar conclusion as early as 1925 when comparing different regional pathways of capitalist transitions in agriculture:
If to this we add in the most developed capitalist countries, such as those in North America … widely developed mortgage credit, the financing of farm circulating capital, and the dominant part played by capital invested in transport, elevator, irrigation and other undertakings, then we have before us new ways in which capitalism penetrates agriculture. […] They convert agriculture, despite the evident scarred and independent nature of the small commodity producers, into an economic system concentrated in a series of the largest undertakings and, through them, entering the sphere controlled by the most advanced forms of finance capitalism.
(Chayanov 1966 [1925]: 262)
The places where finance helped transform nature into landed property, people into (enslaved) labouring subjects, and animals into livestock were often “global countrysides” (Woods 2007) from the very onset of colonial encounters. In these places, finance had its own ways of extracting surplus from farming. Although stock-listed or shareholder-based private enterprises were crucial drivers of colonization, generating both dividends and rent for shareholders (e.g. by leasing it out to settlers), the provision of credit was an equally crucial element in the “terraforming” of the planet. Although, in the age of nation states, credit was often provided by national governments, even these would often borrow from international markets or financial institutions to provide agriculture credit. The owner-occupation of farms first established during colonial times, and later flourishing in many state-backed credit agricultural economies across the globe, veiled the fact that such credit relations – at the very core – would often qualify as rent relations (Whatmore 1986) as much as contemporary institutional investments in farming (see also Chapter 9), even though the mode of rent production from agriculture has profoundly changed. As we shall see later, paradoxically, the ongoing expansion of credit in a country such as Aotearoa New Zealand over the past 130 years or so not only transformed agricultural landscapes but also created an opportunity for new forms of capital to enter farming, as a result of increasing debt levels among local farmers. In contrast, in Tanzania it has been precisely the absence of credit for smallholder farmers – a condition with firm roots in the colonial era – that has justified the search for new forms of financing agricultural transformation.
This chapter has also shown that “modern finance” has, in part, firm agricultural roots. Many of the practices and organizational forms now taken for granted in financial markets have origins in agricultural production and trade. This improbable history needs to be acknowledged. My detailed historical account of the finance–farming nexus does not deny that something is new about the contemporary finance-driven land rush, however. The unparalleled financial power of institutional investors such as pension and insurance companies, the more general acceptance of financial practices and rationalities, the emergence of an unseen globality of finance because of regulatory convergence, the “massification of finance” (French et al. 2011: 801) in many countries of the Global North, the proliferation of investment standards, the crises of established asset classes such as stocks and bonds and the increased demand for food, agrofuels and carbon sinks are all new developments shaping the context for agricultural investments. Financiers increasingly extract value – or, better, rents – by acquiring direct ownership of farmland and control of the production process in order to transform an agricultural asset into a financial one.
To be fair, this book is not the first one to note this shift. As early as 1978, during the rise of financial landowners in the United Kingdom, Doreen Massey and Alejandrina Catalano (1978: 161) concluded that “landownership is undergoing a further change”, and agricultural production was becoming “yet more ‘adapted’ to the capitalist mode of production, and … [was] doing so under the direction of banking capital”. Contrary to the radical political economy analyses of the time, however, this book will show that assetization is not as straightforward as imagined and promised by those tasked with it. Such an insight can be generated only when finance, and the people who work on it, are followed on their journey into farming, rather than letting deductive assumptions be made about them from above. Data could provide some orientation here, but the journey quickly ends in muddy waters, as the next chapter shows.
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