News and new experiences

Some news that I didn't have time to report last post: the JNC's accountant, Segundo Gonzales, passed away suddenly in his sleep last Saturday of a massive heart attack. He was only forty-five years old and appeared to be in perfect health. He was buried in a short ceremony on Monday morning. We (meaning I and my friends at the JNC) got the news late and went to visit his grave that afternoon. It was weird and sad - this guy who was bouncing around the office cracking jokes one day, was suddenly dead the next.

He used to practice his (very rudimentary) English on me - often times when I was right in the middle of something. Most of you know how much I enjoy being interrupted ... needless to say, I wish I had appreciated him a little more. I think everybody felt the same way. He was the office buffoon, a roly-poly guy with a simple soul and a tendency to make inappropriate comments. People made fun of him and talked about him behind his back. I felt sorry for the guy and tried to hide my irritation when he would interrupt me in the middle of some important e-mail to any one of the High Muckety-Mucks and Grand Poo-Bahs that I seem to have become very fond of interviewing. (Met a great one today, by the way, but that's another story.)

So that was Segundo. Here today, gone tomorrow, but not forgotten. Rest in Peace.

Some other news on a lighter note. I mentioned that I went and talked with José Rivera from COCLA. What I didn't mention is that his office is on the same property as their processing plant in Callao (the port of Lima). And that I got a tour of the plant from one of his managers, Juan Jordán (who told me he was Michael's uncle, of course.) The plant was amazing - a labyrinth of blue pipes and tanks stretching about twenty-five feet in the air and covering probably a thousand square feet of space. Next time I go I'll take pictures.

The coffee comes into the processing plant in "parchment" form, which means that everything has been removed from the bean except for a little shell the color of parchment. (Bean is actually a misnomer - coffee is a seed. When I found that out it made me think differently about what I was drinking. I don't know why.) The coffee sits in a big tank until it's ready to be husked. Then it gets picked up by an endless conveyor belt of little tubs and sent into a big husking machine. Once it emerges from the machine fully husked, it gets whisked up a vertical blue tube into another tank, where it awaits being processed. At this point it's green or raw coffee, but the good beans are mixed together with a bunch of bad beans and even rocks and twigs. The rocks and twigs get sorted out via one machine, and then the beans get sorted by size via another. This machine is electronically controlled to adjust for size. You walk up a staircase into a control room where you can see the processing speed. You can also see five pipes reaching down from the ceiling to below the floor. If you open a little trapdoor you can look down below these pipes and see five jetstreams of green coffee beans flying into five little tubs based on the size.

This whole contraption, I should mention, is really, really cool to look at. I felt sort of like Charlie Bucket being taken on the grand tour by Willy Wonka. It touched on that primordial part of me that still likes playing with Legos and blocks, and toy trucks of course (although the first two were a much bigger part of my life.)

Then Juan Jordán showed me the inventory. I am a coffee lover, as some of you probably are too. Imagine being surrounded by something like two thousand sacks of raw coffee beans, each of which weighs at least two hundred pounds. They were sorted into stacks, with labels like "Organic IMO Naturland." Juan Jordán pointed out their classifications and their destinations. COCLA ships all over the world - Belgium, the UK, the Netherlands, Germany, New Orleans, Oakland. In 2005 it shipped 213,969 kilos of coffee for $23,958,567 worth of revenue. (I am reading those figures off a sheet.) In 2005 it returned $4 million in profits to its 8,500 families, adding to their income by an average of 20% above what they would have made selling on the private market (not counting COCLA's price premiums from selling to Fair Trade, organic, and gourmet markets.) It is the biggest co-operative enterprise I have ever seen or even heard of. Heard of a bigger one?

Today I went back to COCLA for another visit and was treated to a cupping. Cupping is the coffee world's word for professional tasting. At COCLA, it is what happens every time they get a new shipment of beans, to test their viability on the extremely varied markets to which they sell. For instance, a coffee with no major defects but with no particular flavor profile will get sent to the conventional market. Most likely you'll find some COCLA coffee at Trader Joe's - that'll be the organic stuff with nothing special about it, mixed in with a bunch of other stuff from different origins. But some of these cups were delicious, full of flavor, and those will be sold to specialty coffee companies like Colorado's Allegro Coffee, which has a brand that comes entirely from COCLA. The efficiency of COCLA's operation is enhanced by this process: no sense in selling a top-quality organic coffee with a unique flavor profile to a transnational that'll mix it together with any number of average to poor-quality beans.

This was my first cupping. Shades of Roald Dahl again. I get to combine this kind of stuff with social justice work? ... Did I mention I love this project?

More to come, of course ...

Progress - Slow but Certain

Almost a month into this trip - my feeling is that the project is undeniably progressing, though slowly. From a casual list of four or five variables, my approach is expanding into a more comprehensive survey and interview format. These new developments are being heavily encouraged by my colleagues at the JNC and those I've met outside it. It appears that at least a significant number of the co-operatives I'll be working with are at significantly higher levels of organizational and management capacity than I had thought. They employ accountants and keep detailed records, to comply with the demands of their certifiers and NGO funders, as well as to analyze their costs and improve their productivity.

Yes, these are businesses, albeit ones unlike any most of us in the United States have ever encountered, in that they are made up of individual farmers instead of wage-workers, and these farmers are the struggling poor of the Peruvian high jungle, scratching out a living on tiny plots. Of course, anyone who lives in an agricultural zone of the U.S. will know that co-ops are not uncommon. Did you know that Sunkist, the orange producer, is a co-op, for example?

Growing up in Berkeley, I thought of a co-op as something progressive that came out of the 1960s and '70s and went out of fashion in the 1980s as the economy got leaner and meaner (okay, just meaner. Fatter and meaner, in fact.) That's not actually true. The co-op has been a viable form of agricultural organization for a long, long time. If anyone's got (lay readable) references for this, I'd love one.

What news? I've moved twice since the last post: first to a private home in Miraflores, Lima's international district, then last night to a hostel across the street from my office. Convenient and clean, with a private bathroom! Too bad the bed is uncomfortable. The housing saga continues.

New contacts:

- Alfonso Cotera Fretel, the director of Peru's Solidarity Economy Network (GRESP.) I met with him last Monday the 16th at his office. Cotera is interested in creating a Peruvian certification system for Fair Trade. It's currently in its early stages and it is not yet certain how it would interact with FLO. However, the idea is a good one: to create a system which is more directly accountable to its constituents, yet which is internationally accredited. Fulfilling both objectives is, of course, the big challenge. Last Friday was GRESP's first meeting, which I attended. The discussion was long and much of it went over my head, but I did record it and will be returning to it later.

- Gycs Gordon of gtz, the German development agency (their version of USAID). He was extremely excited about my project and wanted to connect me with a Peruvian college student doing her undergraduate thesis on Fair Trade. Thanks to Oscar Malca for making the connection.

- José Rivera of COCLA, Peru's biggest coffee co-op. Originally from a coffee growing family, Rivera studied business management and has gone on to manage COCLA's marketing division. COCLA is an extremely sophisticated business organization made up of, at last count, 8,500 families. They market to many, many channels, including Fair Trade, organic, and conventional, and produce at many levels of quality to meet specific importer demands. Rivera's opinion was that Fair Trade was an extremely useful development tool, but its best use was to teach producers how to compete in the specialty coffee market by producing high-quality products with specific attributes.

- Augusto Cavassa of Innovacciones, a network of agricultural development consultants. Cavassa is an amazing guy. I met him at the IEP (Institute of Peruvian Studies), who recently released the latest version of SEPIA, the yearly Peruvian agricultural economics journal. The latest version of SEPIA is full of relevant topics ranging from organic coffee production to globalization and social capital. (Note to UMass-ers and other alt-econ folk: the first person I met at this event was a man named Javier Escobal, a New School Econ Ph.D who had studied Bowles and Gintis's work!) At the SEPIA event, Cavassa told me the story of CECOVASA, a "central" or second-level co-operative made up of a consortium of peasants' associations based in the province (or "department") of Puno, near the shores of Lake Titicaca. Eighteen hours' drive from any major town, these growers worked out a complex system of quality control based on internal incentives provided to those groups that were most productive and delivered the highest-quality coffee. They live in one of the most remote regions of Peru - and in all of South America - yet have managed to become Peru's second-largest coffee co-operative. A couple days later, their general manager walked into the JNC's office. We met and exchanged a few words, including the question, "When are you coming to visit?" ... Good question, but the answer is a definite "Yes!"

I've met with Cavassa twice now, for two hours each, where he's provided me with enormous context and background for the development of my survey. Surveys are his specialty: he showed me one he was working on, a ten-page document aiming to provide a comprehensive profile of a rural organization (that's all I currently remember). He's encouraging me to take a closer look at the first-level producers' organizations. I am not currently sure how much time I will have to do this, especially since they are at different levels of formalization and overall economic development. We will see ...

More to come ... if you're reading this, please provide feedback on format and content - do you want more personal stories or are you more into the gory details of my topic? I'm aiming to provide a balance of both.

First Week's Fruits: Music, Food, New Contacts, and Encounter with Uncle Sam

Officially one week since I arrived here - so much new to see and experience, and recount.

Saturday was nothing but pure fun - two BIG thank yous: first, thank you Frederique for encouraging me to bring my saxophone! Second, thank you Fernando for introducing me to your awesome friends! Marco picked me up around 3 PM and we went for a tour of the city, ending up at his place jamming with his band, drinking pisco and Peruvian wine, and talking history and politics late into the night.

Sunday night I discovered a wonderful restaurant around the corner from my hostel - absolutely delicious food, amazing ambience, and run entirely by people in their 20´s. Great people, extremely smart, hip Limeños and Limeñas. It´s not every day that I sit down to a delicious dinner of steak and mushroom risotto and chicha morada (that´s the local beverage made from a deep purple maize, boiled with sugar - it´s delicious) - only to have the chef walk out of the kitchen and start chatting with me! Angel was his name, a guy maybe my age, just out of cooking school; his sister Katy, an interior designer who did the décor, and his girl friend Cynthia behind the cash register. Very, very cool people, all. The restaurant is called "Porque Sí" which translates to "Just Because." Don´t let me forget to write Lonely Planet and tell them about this.

Yesterday was university day - met with UMass alum and Econ department chair José "Pepe" Távara at the Universidad Católica. Pepe (as he is known at UMass at least) has done some great work on competition and public service regulation. It´s also not an everyday occurrence for me to sit down to lunch with the former president of Peru´s Central Bank! Oscar Dancourt, a very smart man, a fan of Bernanke´s and an inflation targeter (no comment). The Peruvian economy is growing fairly quickly, exports are up and credit´s doing well. We agreed about Barry Eichengreen and Paul Davidson (thumbs up on the first, thumbs down on the second, sorry Jimsky). He said some other things but that´s all I remember.

Anyway, thanks Pepe for offering me Católica library access... the JNC will thank you too.

Spent the afternoon in the office of agribusiness economist Oscar Malca from Universidad del Pacífico, a school for business administration and economics - very, very smart and helpful! We had a great discussion and he set me up with contacts and data. A big thank you to Oscar and to Luz Díaz from Head-Royce for making the connection.

Today was my U.S. Embassy security briefing, which was mandatory for Fulbrighters. This is one experience I have to describe to you in detail. The Embassy is about ten miles outside the center of town (but still in town - Lima is huge), an enormous building surrounded by a security wall with one ingress, where Peruvians line up by the hundreds to get their visas, and gringos like me walk right in the other door. The building is an enormous block about ten stories tall with tiny little windows, and now there is a USAID annex part of the same compound, a darker color but similar design. (That´s right, it takes big guns to help poor people, right?) I walked up to Security Checkpoint 1, where they checked my cell phone, flash drive, and pocket translator, and put my bag through a metal detector. Then across an empty stone patio the size of a football field, and on through 14-foot-tall steel doors guarded by a sentry with a machine gun, to Security Checkpoint 2, with another metal detector. After that, I spoke to reception, and an escort came down to escort me past the Marine sentry guard (checkpoint 3?) upstairs and into a windowless office block. There I was met by a guy named Murphy (unfortunately, that was his actual name) who described crime and terrorist scenes in detail for an hour and a half to a group of about 15 of us. He told us not to go anywhere in the center of the country. (Note: the regions I plan on visiting lie to the east of the regions he showed, if anyone is concerned.) A bit troubling is the fact that some Senderistas are getting out of prison pretty soon, but who knows whether these are the main instigators or just peons who got seduced by the Maoism. At any rate, the information would have been a lot better received (by me, at least) if it hadn´t been delivered in an overall atmosphere of borderline-clinical paranoia. If I learned anything in Chiapas, it is that the best way to stay safe in an unstable zone is to stay close within a social network, of which I have quite a good one here in the JNC.

So that was my experience with Uncle Sam in Peru ... it didn´t seem like much of an embassy to me, more like a fort. I want to believe that this is a holdover from the days of the late ´80s and early ´90s when the Shining Path really did threaten a lot of people, or perhaps the Cold War, but I don´t, actually. I think the war on drugs keeps this mentality alive and kicking. I sensed a real reticence to engage with Peruvians by the U.S. government and their representatives. Murphy said some contemptuous things about Peruvians during the talk, and the overall atmosphere was one of distrust for the local people and a desire to wall oneself off from the society at large. He did say one nice thing about the Peruvian police at the end of the talk, but I felt it was too little, too late.

I am writing to you from an Internet station on a busy street in an ordinary part of Lima. The station is full of students of all ages, middle-aged and elderly women and men. It opens onto the street. I go to work every day in an ordinary Lima neighborhood - not the poorest, but not the richest, either. It feels comfortable, not such that I don´t have to be alert, but not menacing, either. Lima is a big city, and certainly full of social ills, poverty and petty crime. But as most seasoned travelers know, the most important things are to keep your wits about you, take basic precautions, and listen to the travel advisories and local people you trust.

The effort to build durable and mutually beneficial transnational networks of trust and co-operation is one of the main things that draws me to Fair Trade. The embassy experience just made me realize how important that aspect of the work really is.