Corporate Crime
US Companies
Caught Trading with the Enemy
DynCorp Discrace
Top 100 Corporate Criminals
of 1990
TOBACCO INDUSTRY
THE CORPORATE CROOKBOOK
THE SHAREHOLDER ISSUE
Politics
Meet the
Carlyle Group
Articles
about the Carslyle Group, Enron and the Bush Junta's Corporate Connections
Halliburton
Bush and Corporate Globalism
(see Bush)
ONE SOLUTION
TO CORPORATE MALFEASANCE: ELECT BETTER REPRESENTATIVES
THE BEST DEMOCRACY MONEY CAN BUY
BRIBING CONGRESS
BUSH FAMILY PART OF CORRUPT SYSTEM
AMERICAN KLEPTOCRACY
BUSH IN CORPORATE CORRUPTION
BUSH ADMINISTRATION FACILITATES
CORPORATE CRIME
HHS WEAKENS REGULATION OF CORPORATIONS
Corporations Gaining in Power
Corporations
Are Insane
By Ross Crockford, AlterNet
January 29, 2004
RISE OF CORPORATE POWER: THE SILENT
TAKEOVER
FIRST AMENDMENT RIGHTS TO
CORPORATIONS
MONOPOLY CORPORATE
TAKEOVER
CARTELS, WWII, AND POWER TODAY
Corporations and the Environment
MONOPOLIZING WATER
MONOPOLIZING WATER 2
TOXIC CHEMICALS IN ENVIRONMENT
Fighting Corporate Power
WOMEN'S INTERNATIONAL
LEAGUE FOR PEACE AND FREEDOM ON CORPORATE CRIME: GETTING AT THE ROOTS
REFORMS
DO NOT CHANGE CAUSAL STRUCTURES OF CRIME
MULTINATIONAL
MONITOR
Corporations Are Insane
By Ross Crockford, AlterNet
January 29, 2004
Enron. WorldCom. Bechtel. Halliburton. To the cheerleaders on MSNBC
and in The Wall Street Journal, such deceitful, profiteering companies
are a few "bad apples" in a healthy economic barrel, as rare as a murderer
in a convent. But a new documentary that premiered at the Sundance festival
film last week argues that these rogue companies aren't the exception,
they're the rule. The controversial premise of The Corporation is that
every company is legally programmed to act like a psychopath. And the
bigger it gets, the worse it behaves. "The corporation is a paradox,"
says Mark Achbar, who co-directed and wrote the documentary with Vancouver
filmmaker Jennifer Abbott and law professor Joel Bakan. "It generates
tremendous wealth, but at tremendous social and environmental cost."
Achbar, best-known for his 1992 documentary "Manufacturing Consent:
Noam Chomsky and the Media," says that when he started working on the
new film six years ago, it originally was about the anti-globalization
movement. But he realized that the growing protests were really against
corporate power Ð and despite the millions of news hours and pages devoted
to mergers, acquisitions, marketing strategies and CEO profiles, no
one had really examined the history and the character of the corporation
itself. An unlikely subject for a hit film, perhaps. But The Corporation's
entertaining mix of interviews, cartoons and old industrial films has
already won three "people's choice" prizes at film festivals, including
Sundance's World Cinema Documentary Audience Award (sponsored, ironically,
by Coca-Cola). In Canada, where "The Corporation" has garnered rave
reviews Ð one compared it to "the best issue of Harper's magazine set
to music" Ð it's currently playing to sold-out theatres across the country.
"Everybody wants to buy their products from a socially responsible corporation,
not from some horrible polluter," Achbar says. "The question is, how
are we going to resolve this dilemma?" As the film spells out, corporations
have often been regarded with suspicion. America's founding fathers
worried that enterprises like the Dutch West India Company, which controlled
vast areas of the new world, would overwhelm their republic. (Thomas
Jefferson wrote to a friend: "I hope we shall ...crush in its birth
the aristocracy of our moneyed corporations which dare already to challenge
our government to a trial of strength, and bid defiance to the laws
of our country.") So when the U.S. government granted charters allowing
new corporations to come into being, the terms were restricitve. But
corporations grew in size and power during the booming 19th century,
and their owners wanted to expand their legal rights as well. Since
owners or shareholders couldn't be held personally liable, they argued,
the corporation itself should be treated as a "person" Ð thus entitling
it to all the protections of the Constitution. The argument was accepted
by the U.S. Supreme Court in 1886, in the case of Santa Clara County
v. Southern Pacific Railway Company. Consequently, a corporation today
has the right to free speech, the right to own property, and the right
to due process of law, just as a person does. So what kind of person
is it? To answer that question, the film ingeniously compares notorious
examples of bad corporate behavior to a list of psychiatric symptoms.
Nike jumping from sweatshop to sweatshop in ever-poorer countries? That
shows an "incapacity to maintain enduring relationships." Monsanto's
refusal to acknowledge the harm caused by Agent Orange? That's an "incapacity
to experience guilt." Corporate directors are required by law to do
only what's best for the company, regardless of the consequences to
anyone else Ð in other words, a corporation is motivated purely by self-interest.
Add up the symptoms, as an FBI consultant does onscreen, and the corporation
starts to resemble Ted Bundy. Several of these points are scored in
the film by Michael Moore, Noam Chomsky, writer Naomi Klein and historian
Howard Zinn. The filmmakers also interviewed CEOs Ð and discovered that
many of them are equally troubled by corporate pathology. The perverse
genius of the corporation is not just that it maximizes profit by offloading
as many costs (employee education, environmental cleanup) as possible
onto the public; it also enables owners and managers to simultaneously
claim that each other are ultimately responsible for the company's actions.
Even to those at the top, the corporation seems like a monster beyond
anyone's control. "Even though the perception is that you have absolute
power to do what you want, the reality is that you don't have that power,"
says Sam Gibara, the former CEO of Goodyear, when asked in the film
about the massive layoffs he oversaw in the late 1990s. "Sometimes,
if you really had a free hand, if you really did what suited your personal
priorities, you'd act differently. But as a CEO you cannot do that."
Gibara's not entirely correct; Ray Anderson, CEO of the carpetmaker
Interface, emerges as the soft-spoken hero of the film, for pushing
his company to embrace principles of environmental sustainability. But
as "The Corporation" points out, such conversions are rare, because
one-half of all stock in publicly traded U.S. companies is owned by
the wealthiest one percent of the population. If there's any criticism
to make of the film, it's that the barrage of such facts is relentlessly
depressing. It also tends to lose its focus in the latter half of its
145-minute run time, by detailing even more alarming case studies of
corporate malfeasance, such as Fox News suppressing its own reporters'
investigations into Monsanto's bovine growth hormone, or IBM's collaboration
with Nazi Germany, each of which deserve an entire documentary on its
own. But like a Hollywood blockbuster, "The Corporation" does manage
to end on an upbeat note. Co-directors Achbar and Abbott turn their
lens on citizens' movements around the world that are discussing and
protesting corporate power, and in some cases initiating petitions and
court proceedings forcing governments to revoke the charters of particularly
malevolent companies. After all, as Nobel prize-winning economist Milton
Friedman says onscreen, the corporation is merely a legal structure.
And to filmmaker Abbott, that leaves room for hope. "We created the
corporation, and we can change it," she says. "We want people to emerge
from the film feeling there are things we can do." Ross Crockford is
a freelance writer who lives in Victoria, British Columbia.
ONE SOLUTION TO CORPORATE MALFEASANCE: ELECT BETTER REPRESENTATIVES
Yesterday WorldCom, the nation's second-largest long distance company,
announced that it had cooked its books to the tune of $3.8 billion,
almost six times the size of the Enron scandal. Every day seems to bring
a new revelation of massive wrongdoing by corporate executives. At companies
across the country, CEOs have made themselves rich while stealing from
the rest of us. Why is our government unwilling to go after these guys?
For one thing, many top officials have close ties to these corporations.
Enron, for example, is President Bush's top financial backer. Vice President
Cheney used to be the CEO of Halliburton, another energy company whose
accounting is now under SEC investigation. We don't have to put up with
this corruption. Instead, we can send new leaders to Washington, hardworking
people of principle and courage. Right now, you can make a big difference
by giving just $10 or $20 to support people like Ron Kirk, who's running
for the Senate, at: http://www.moveonpac.org/moveonpac/viewcandidates.phtml
Ron Kirk is a ray of hope for all of us -- a popular African- American
mayor of Dallas, now the Democratic candidate for the Senate from Texas,
the heart of Bush-Enron country. Kirk is a pro-choice, environmentally-friendly
moderate; an advocate of affordable housing; a promoter of economic
investment and empowerment initiatives in minority communities; and
an official who takes thoughtful positions on complicated issues. He
also has a rare ability to reach across ethnic and party lines. That's
why he got a majority in each of the white, Hispanic and African-American
communities the last time he ran for mayor of Dallas, and why pollsters
are giving him an even chance of winning the Senate seat, rating the
race a "toss-up." Kirk is running against Texas Attorney General John
Cornyn. Cornyn has taken $193,000 from Enron, issued a legal opinion
favoring the company, and then recused himself from the state's investigation
into the Enron collapse, in which more than 4,000 Texans lost their
jobs and pensions. Kirk is a perfect example of why it matters who we
elect....
WOMEN'S INTERNATIONAL LEAGUE FOR PEACE AND FREEDOM ON CORPORATE
CRIME: GETTING AT THE ROOTS
WILPF Statement on "corporate malfeasance" This is an opportune time
to talk with people about corporate trampling upon democracy, but the
danger is that we concerned citizens will once again be co-opted by
diversionary reforms and rhetoric about corporate accountability and
responsibility. Only human beings can be responsible, and the corporate
form should be more than accountable to us; it belongs subordinate,
as do all institutions that We the People create to serve us. George
Bush and other administration officials, with the complicity of the
media who are part of the corporate class, are engaged in the rhetoric
and reform of damage control. They are scrambling to frame the problem
as one of accounting, as a lack of integrity and character in a few
bad corporate apples. It is our job to frame the problem as a constitutional
one: the privileging of property over people, especially property organized
in the corporate form; the Supreme Court's longtime and continuing empowerment
of corporations through the Commerce Clause and the Contracts Clause;
and the Court's 1886 declaration that corporations are legal persons
entitled to 14th Amendment protections, from which a host of illegitimate
rights and governing authority flow. We as democracy activists must
not allow ourselves to be co-opted by the longstanding pattern of pallid
reforms. The early 20th century Progressive/regulatory era took the
steam out of the powerful Populist Movement. The New Deal forestalled
a serious challenge to corporate capitalism. The flurry of environmental
regulations in the 1970s co-opted the growing awareness of ecological
peril. Some of the resulting reform measures were indeed necessary and
useful, like labor laws, Social Security, the Clean Air and Water Acts.
However, their underlying purpose and net effect were to prevent more
fundamental systemic change in who governs. Are we once again going
to trade our self-governing birthright for a mess of potage? The remedy
is not pressuring or cajoling or seeking "reforms," but building a democratic
movement -- already underway -- to challenge the authority of corporations
to govern. Of course the harms and abuses (many of which are legal)
exposed by "scandalous" events of recent months must be addressed. However,
we have a larger, longer term goal: to put we the sovereign people in
charge of defining and instructing our economic entities and other institutions.
WILPF's national action to Abolish Corporate Personhood is designed
to educate and mobilize people to challenge and change the power structure
rather than simply react to specific corporate+government harms and
abuses. This is a critical time and opportunity for WILPF to provide
leadership toward this end. Leadership Team, Challenge Corporate Power:
Assert the People's Rights Campaign July 11, 2002 Pamela Jones-Burnley
Women's International League for Peace and Freedom 1213 Race Street
Philadelphia, PA 19107 Phone: 215-563-7110 Fax: 215-563-5527 Email:
pjburnley@wilpf.org Website:
www.wilpf.org
RISE OF CORPORATE POWER
THE SILENT TAKEOVER - global capitalism and the death of democracy,
by Noreen Hertz
I first encountered the author on Bill Moyer's "NOW" show on PBS. I
was impressed with the scope of her knowledge and grasp of current reality
when she spoke of corporate power vs. government and the service of
citizens. I wanted to read her book. I ordered it that evening, from
Amazon.com. I finished it this weekend and now want to bring it to the
attention of everybody I can. I recommend this book to those of us who
need a historic perspective that will bring us up to the present alignment
of power in the world. Many of us have an idea of what is happening;
are even reacting to it with demonstrations of dissent. But how many
of us understand why and how things got this way? I mean, beyond pet
conspiracy theories and simple judgments like, "It's just a matter of
greed!" Noreen Hertz has both the academic qualifications (MBA, Wharton;
BA in Philosophy & Economics, University College, London; PhD, University
of Cambridge) and real-world experience, having worked for the World
Bank advising Russia on its economic reforms and engaging the Middle
East Peace Process with the Palestinian Authority and the governments
of Israel, Jordan and Egypt. She will, in well-crafted, short sentences,
pull you through the slow abdication of government responsibility to
citizens and the corresponding increase of corporate power. You see
how this has happened before, but not in exactly the same way, nor with
the same degree of ultimate consequence. Humanity lies revealed, even
in the sequestered environments of corporate offices; at the same time
terrifying and hopeful. In the end, you may have a better idea of what
we need to do to bring democracy back to life. Wilson (Woody) Powell
National Administrator Veterans For Peace, Inc. 438 No Skinker St. Louis,
MO 63130 (314) 725-6005 vfp@igc.org "We, having dutifully served our
nation, do hereby affirm our greater responsibility to serve the cause
of world peace by applying the concept of engaging conflict peacefully,
without violence." http://www.veteransforpeace.org
Info about Greg Palast and an outline of his book - THE BEST DEMOCRACY
MONEY CAN BUY -
"The information is a hand grenade." John Pilger, New Statesman "Greg
Palast is investigative journalism at its best. No one has exposed more
truth about the Bush Cartel and lived to tell the story." Baltimore
Chronicle "Here's how your President was elected: In the year leading
up to the Presidential election, Katherine Harris and Jeb Bush removed
tens of thousands of citizens from the voter rolls. Harris claimed they
were felons - but almost none were - though 54% were guilty of being
African-American...." -- The Best Democracy Money Can Buy - excerpted
in this month's Harper's Award-winning reporter for BBC Television's
Newsnight and The Observer of London, Greg Palast's extraordinary reports
have been front page news in Europe, yet blocked out of America's main
stream media. "To Americans who cannot read his stories printed in Britain's
Observer, he is America's journalist hero of the Internet." Alan Colmes,
Fox Television "His stories about Bush's election theft, about intelligence
agency cover - ups, and globalization - backed up with smoking gun documents,
inside sources and on - the - record interviews - will shock even the
most informed readers." -- Guerrilla News Network, naming Palast "Reporter
of the Year." Palast won Britain's highest journalism honors for his
1998 undercover investigation of influence peddling within Tony Blair's
cabinet - by Enron and other US corporations. He then turned his sleuthing
skills on to the Bush money trail: uncovering for BBC and The Observer
the uncomfortable truths of how the Bush Administration quashed investigations
of Saudi financing of terror -- and Poppy Bush's extraordinary methods
for stuffing his bank account and his son's campaign coffers. Palast,
winner of the Financial Times David Thomas Prize and Nominated Business
Journalist of the Year (UK) for his exposing "Reverend" Pat Robertson's
legally dodgy business scams, has appeared in Salon.com ("Politics Story
of the Year" 2000), Harper's and The Washington Post ... yet he remains
to most Americans, "The world's greatest investigative reporter you've
never heard of." (Cleveland Free Times) Not everyone has a taste for
Palast. After exposing on BBC TV the contents of a stack of documents
from inside The World Bank and the World Trade Organization, the WTO
called his writings, "Rubbish rubbish rubbish," and CNN reported, "The
World Bank hates Greg Palast" -- for stories the Wall Street Journal's
Jude Wanniski called, "Extraordinary reporting on the IMF," and Nobel
Laureate Joe Stiglitz called, "Excellent on the WTO." Before taking
up the pen for the The Observer and Guardian newspapers, Los Angeles-born
Palast traveled the globe as expert investigator of corporate fraud
and racketeering. For the Chugach Natives of Alaska, he unearthed the
doctored safety records that proved the Exxon Valdez disaster was an
inevitability, not an accident. In Chicago, he bargained contracts for
the United Steelworkers Union in Chicago, in Peru he helped found a
consumer rights organization. Years ago, he guided the formation of
an alliance linking Enron workers in Brazil and India. In 1988, Palast
directed the government's investigation of a US nuclear plant builder
in which the jury awarded the largest racketeering penalty in US history.
And this summer, the United Nations International Labour Organisation
(Geneva) will issue his book, Democracy and Regulation, based on his
lectures at Cambridge University and University of Sao Paulo. At booksellers
in March * Published by Pluto Press * 221 pages plus illustrations *
Hardback $25 For reviews, interviews and events bookings contact Fredda
Weinberg fredda@gregpalast.com (347) 528 7789 * For sales: pluto@plutobooks.com
THE BEST DEMOCRACY MONEY CAN BUY Contents Who Gives a Shit? An Introduction
Chapter 1. JIM CROW IN CYBERSPACE - The Unreported Story of How They
Fixed the Vote in Florida. In the days following the Presidential election,
there were so many stories of African Americans erased from voter rolls,
you might think they were targeted by some kind of racial computer program.
They were. Chapter 2. SELL THE LEXUS, BURN THE OLIVE TREE - Globalization
and its Discontents. A cache of secret documents from inside the IMF,
World Bank and World Trade Organization explains the inner workings
of the iron triangle of globalization. Chapter 3. SMALL TOWNS, SMALL
MINDS I live in one of those lovely little rural villages in America
that still preserve good old American small town virtues. So why has
our local newspaper written two editorials requesting I get the hell
out? Chapter 4. PAT ROBERTSON, GENERAL PINOCHET, PEPSI-COLA AND THE
ANTI-CHRIST: Special Investigative Reports Award-winning investigative
reports. Chapter 5. INSIDE CORPORATE AMERICA Fifteen thousand stockholders
believe they hear Sam Walton speak months after he died - and other
strange tales Planet Dollar. Chapter 6. THE BEST DEMOCRACY MONEY CAN
BUY Who owns America? How much did it cost? Cash, check or credit card?
The Bushes and the billionaires who love them. Chapter 7. CASH-FOR-ACCESS
- ?LOBBYGATE? - the Real Story of Blair and the Sale of Britain. My
bald head took up the entire front page of the Mirror under the headline,
?THE LIAR!? Did I upset someone? When Tony Blair came to power, I set
up an undercover sting exposing the influence kasbah in 10 Downing Street.
Chapter 8. KISSING THE WHIP When the TV infotainment hypnosis wears
off, when ?Have a nice day? is an insufficient answer to getting screwed
by the powers that be, Americans can surprise themselves, rise up, and
say, ?No thanks, we won?t kiss the whip that beats us.? Thoughts in
exile. Chapter 9. Victory in the Pacific - A Conclusion
BRIBING CONGRESS
CENTER FOR RESPONSIVE POLITICS Web Update July 25, 2002 tel: 202-857-0044,
fax: 202-857-7809 email: info@crp.org, web: www.opensecrets.org Corporate
Fraud: Accounting Industry Contributions to the Conference Committee
By Vikki Kratz Members of the House-Senate conference committee that
drafted the final version of the accounting reform bill before Congress
today have received more than $770,000 from the industry since 1999.
To see a complete breakdown of contributions to members of the committee,
click here: http://www.opensecrets.org/news/accountants/accountants_conferenc
e.asp
BUSH FAMILY PART OF CORRUPT SYSTEM
July 22, 2002 The Sellouts in the Fourth Estate by Wayne Madsen
To paraphrase Benjamin Franklin, "Journalists who would give up some
credibility for a little government access deserve neither." Too many
members of the Washington press corps have become nothing more than
toadies for the current administration. While every administration can
be expected to have its fair share of loyalists penning favorable pieces
on the news, editorial, and op-ed pages, what is amazing in the current
environment is the lemming-like rush by a number of heretofore liberal
and progressive reporters to support the Bush II administration's extreme
right-wing policies. These modern day quislings in the media even provide
the White House with helpful cover from investigations by more independent-minded
journalists. Such has certainly been the case with the recent publication
in English of "Forbidden Truth: U.S.-Taliban, Secret Oil Diplomacy,
Saudi Arabia, and the Failed Search for Bin Laden." Written by French
journalists Jean-Charles Brisard and Guillaume Dasquie, the book's first
French language publication in Europe caused a major furor. But it was
not with the French government or its friends in the media. The angst
was among members of the Bin Laden family -- the so-called "good bin
Ladens" and those who have done business in the past with George W.
Bush and his father. Yeslam bin Laden, one of the "good" bin Ladens
in Switzerland sued the authors for the information they provided on
the bin Laden family's past business dealings. The suit went no where
because the authors had absolute proof that not everything the bin Ladens
have done in finance and business has been on the up and up. But now,
some self-appointed media spokespeople in Washington have taken up the
cause that the bin Ladens wisely decided to drop. They have criticized
Forbidden Truth without having read it or only having read snippets
from it. It would appear that they have taken their cue from a White
House family, who, like the bin Ladens, seem to have an awful lot to
hide. The book has also been criticized for being unsourced when, in
fact, it has over 500 footnotes. Footnoting and providing references
is a practice that some of Washington penultimate journalistic insiders,
including Bob Woodward of The Washington Post, should adopt in their
own future docu-novels concerning administration cover-ups and malfeasance.
That Washington's media elite appears to be anesthetized to Bush's current
drive to turning the United States into some mirror image of East Germany,
China, or Pinochet's Chile cannot be overstated. The creation of the
Freedom Corps, with neighbors turning in neighbors under the Terrorism
Information and Prevention System (TIPS), the scrapping the Posse Comitatus
Act of 1878 to once again permit Federal troops to engage in civil law
enforcement (including the possibility of their providing "security"
at polling places this November and in November 2004), having booksellers,
librarians, and video rental clerks report on the reading and viewing
habits if their customers, and even the suggestion by a Bush appointee
to the US Civil Rights Commission that internment camps may be necessary
for Arab-Americans all point to an administration that is hell bent
on destroying this country in order to save it. So the media elite,
in some perverted and confused quest to show its loyalty to the Bush
family, has decided that linking its policies in Afghanistan and the
Middle east to its past oil dealings, is somehow off the mark, "out
there," unworthy of consideration. Reconstructed liberal and progressive
journalists throw around the "C word" (conspiracy) to detract from those
who write about the massive evidence that points to the Bushes having
traded the nation's economic well-being and national security for personal
profit. Grandfather Bush, Prescott, certainly did this during World
War II when his investments included companies that supported Nazi Germany's
war effort. Now we have Neil Bush, from Silverado Savings and Loan infamy,
cutting deals all over the Middle East using Daddy's and Dubya's business
and political connections in that part of the world. And why shouldn't
he? Dubya did this with a lucrative pipeline deal in Argentina for Enron
in 1989 when he was pimping for Enron and Daddy was in the White House
gearing up for a war with Iraq, another act that would eventually line
the pockets of the Bushes. Brisard and Dasquie provide concrete evidence
how this same self-serving approach to business permitted the Taliban
to negotiate with senior members of the Bush administration on a lucrative
pipeline deal just weeks prior to the al Qaeda terrorists slamming commercial
jetliners into the World Trade Center towers and the Pentagon. It's
the same mind set that in 1990 convinced U.S. ambassador to Iraq April
Glaspie to tell Sadaam Hussein that the Bush I administration had no
interest in his inter-Arab border dispute involving Kuwait. We now all
know why the Bush family had no great interest in that "minor" dispute.
They made a fortune from it, along with then Secretary of Defense Dick
Cheney, whose Halliburton company helped rebuild the oil infrastructures
of both Kuwait and Iraq. And now we have some of the same players standing
to make a fortune from a trans-Asian CentGas pipeline that will extend
from Turkemenistan, through Afghanistan, to Pakistan's Indian Ocean
port of Gwadar. Dubya's, Cheney's, and Condoleezza Rice's Big Oil friends
at Unocal, Halliburton, Chevron, and Saudi Arabia's Delta Oil all stand
to make a handsome profit from the CentGas deal. Enron, in concert with
Bush's Special Envoy for Afghanistan, Zalmay Khalilzad, actually developed
the feasibility study for the pipeline. And current Secretary of the
Army, Thomas White, who now influences U.S. military policy in Afghanistan,
was a Vice President of Enron in charge of such "special deals." So
its little wonder we are told in Forbidden Truth that representatives
of the Bush administration told the representatives of the Taliban in
Berlin in July 2001 that they would be faced with a "carpet of gold
or a carpet of bombs." Its so arch-typical Bush. Meanwhile, First Brother
Neil has found lucrative comfort in Saudi Arabia, the home of 15 of
the 19 hijackers of 911. His company, Ignite!, Inc., an e-learning educational
software company, has been busy finding clients in the educational community
of Saudi Arabia and the United Arab Emirates. It's always a great thing
to find better ways to teach. But we also know that schools in these
countries are financed and influenced by the Wahhabi clerical structure,
the most radical form of Islam that preaches violence against Christians,
Jews, and even fellow Shia and Sufi Muslims. It is, therefore, astounding
that Brother Neil would be trying to sell software to schools that can
then put vile and extremist religious rantings online and accessible
to more "students," madrassas , and future terrorists throughout the
Middle East. But then again, when have the Bushes ever cared about the
consequences of their business dealings? In fact, so-called "homeland
security" also seems made to order for the Bushes. From 1994 to 1999,
Neil ran Interlink Management Corporation from 10000 Memorial Drive
in Houston in the same building where Daddy Bush has his office. Interlink
is a venture capital firm that funded start-up companies in the biotech
fields, including many that are currently engaged in bio-war defenses
involving people, animals, and crops. Once again, how convenient for
the Bushes. Has anyone at the FBI thought about looking into these firms
and how they may have profited from the anthrax attacks against the
Democratic leadership of the Senate? Probably not, wait -- certainly
not! And who is one of Neil Bush's best friends and advocates in the
Middle East? A leader who said this following 911: "the United States
must not to act in haste, it must give diplomacy and legal means every
opportunity before launching a military strike on Afghanistan, it must
not rush to accuse people without hard evidence." His name is Shaikh
Mohammed bin Rashid al Maktoum, the Crown Prince of Dubai and Defense
Minister of the United Arab Emirates, a country that was one of three
to recognize the Taliban and a center for the financing of al Qaeda
and other terrorist groups. Last October, while visiting Dubai, Brother
Neil praised the good Shaikh as a man with "foresight and vision." Bush's
other escort was Shaikh Hamdan bin Rashid al Maktoum, the Finance Minister
of Dubai and someone who certainly had his pulse on the millions of
dollars sent through the emirate on their way to the Taliban and Pakistani
madrassas and Islamic "charities." So once again, the Bushes are up
to their asses with corruption and questionable business partners and
acquaintances. "Forbidden Truth" highlights some of these. But it is
only a start. But the Washington-based sell outs in the Fourth Estate
cannot be counted on to expose the rest of the Bush dirty business deals.
And they extend far and wide: The Caryle Group and Barrick Gold, on
whose boards Daddy Bush serves -- the first company does business with
the Bin Laden Group while the second is involved with questi onable
CIA-backed regimes in Africa; Scowcroft Associates, headed by Daddy
Bush's National Security Adviser and Dubya's Chairman of the President's
Foreign Intelligence Advisory Board -- it is involved with shady deals
from the privatization of South Africa's state-owned telecommunications
company to the CentGas deal; JNB International, an oil firm that along
with Enron used Bush influence to get oil and gas contracts in Argentina;
M&W Pump and its partner Bush-El, Florida firms that used Jeb Bush to
intercede with it in military-ruled Nigeria in 1989; and the list goes
on and on. If only the media elite in Washington would just stop shooting
their own messengers and begin focusing on the real issues in this town,
we might all be able to breathe a little easier. Wayne Madsen is a Washington-based
investigative journalist. He wrote one of the introductions to "Forbidden
Truth." He can be reached at: WMadsen777@aol.com
TOBACCO INDUSTRY
Orey, Michael. The Mavericks, the Lawyers, and the Whistle-Blowers
Who Beat Big Tobacco. Little, Brown, 1999.
THE CORPORATE CROOKBOOK
Take a look at this link to an impressive list of investigations and
lawsuits against apparently crooked corporations. It comes from a website
Ralph Nader suggested on his Donahue Show appearance last week. The
Corporate Crookbook http://www.citizenworks.org/enron/corp-scandal.php
KLEPTOCRACY
AMERICAN KLEPTOCRACY MoveOn Bulletin Wednesday, July 31, 2002 Edited
by Eli Pariser (eli.pariser@moveon.org) Subscribe online at: http://www.moveon.org/moveonbulletin/
CONTENTS Introduction: The Problem One Link The Causes The Team The
Pitch The Real Solutions Update: Operation TIPS About the MoveOn Bulletin
and MoveOn.org INTRODUCTION: THE PROBLEM "CORPORATION, n. An ingenious
device for obtaining individual profit without individual responsibility."
--Ambrose Bierce, The Devil's Dictionary So much for the notion that
accounting's a boring profession -- the best illusionist in the world
could not have "disappeared" billions of dollars as well as the recent
spate of corporate criminals did. WorldCom, for example, "discovered"
$3.8 billion in expenses. That's nearly five times the budget of the
entire Securities and Exchange Commission, the government agency that's
supposed to be watching for these crimes. The WorldCom announcement
came after months of revelations about accounting malpractice. Starting
after the Enron scandal broke, lawmakers made a lot of noise about corporate
reform, but no new laws were in place over half a year later when WorldCom
went down. It wasn't until the stock market tanked that politicians
and business leaders finally recognized the magnitude of the scandals'
impact. Although attention has focused on Wall Street and the Dow Jones
Industrial Average, the economic fallout from corporate wrongdoing has
been widespread. It's been especially painful for the middleand lower-class
Americans who can't afford top-of-the-line stock brokers and well-managed
mutual funds, and for those who work for the fallen companies or their
vendors. The telecom sector faces record job losses in the hundreds
of thousands this year, largely due to the collapses of Adelphia and
WorldCom. When all is said and done, WorldCom, Enron, Tyco, and Adelphia
(to name a few) could cost the United States over a trillion dollars
this year. That's a fifth of the Gross Domestic Product. The FBI estimates
that white collar crime costs more than $200 billion in a typical year,
over 46 times the cost of street crime and burglary. Yet while millions
of low-level thieves have been imprisoned in the last ten years, the
SEC has jailed only 87 executives for corporate wrongdoing. The term
"kleptocracy" was coined to refer to the regime of an African dictator,
Mobutu, who used his power to amass an enormous fortune. The recent
actions of CEOs and CFOs are similar: the people at the top abused their
authority to steal from the little guys. To make things worse, the upper
echelons of the Bush Administration are packed with people who have
engaged in this type of corporate misbehavior. They've shown a marked
resistance to any proposals for serious reform, although sliding poll
numbers have pushed them to retreat. Alan Greenspan blamed the scandals
on a culture of "contagious greed." Many of our government leaders --
the men and women who are supposed to solve this mess -- prospered in
and emerged from that culture. ONE LINK Originally titled "Flavors of
Fraud," this short article by economist and New York Times columnist
Paul Krugman explains the recent corporate scandals in the context of
an ice cream parlor. If accounting jargon has you confused about who
did what to whom, or where all that money went, the explanation below
will make things crystal clear. http://www.9-11peace.org/r2.php3?r=97
THE CAUSES Ever since the Enron scandal broke, pundits have been grappling
with the meaning of the current spate of corporate crime. Critics on
both sides of the political spectrum know that the "lesson" of this
crisis -- what happened and why it happened -- will determine its impact
on the private and public sectors. Here are a few of the favorite positions:
The Hangover "America must get rid of the hangover that we now have
as a result of the binge, the economic binge we just went through,"
Bush said on July 15th. The theory goes as follows: history shows that
after speculative bubbles burst, newly sobered investors often look
more closely at the ventures they've been throwing money at. This scrutiny
often brings to light fraudulent activities that kept the bubble growing.
Of course, if you accept this analysis, then almost everyone shares
the blame for the plummeting stock market and the teetering economy.
After all, investors, stock brokers, and corporate folks alike joined
in "talking the market up" in the late 1990s. Conservatives like this
theory because it takes the heat off corporate executives and their
political friends. Deregulation Corporations and the accounting industry
brought the scandal upon themselves by eroding all of the existing safeguards.
In a decades-long campaign, lobbyists pushed for increasing deregulation.
The checks and balances that kept corporate directors and CEOs accountable
were destroyed; accounting auditors were allowed to develop ever stronger
relationships with the companies they were auditing. By the 1990s, corporations
were operating with few external controls; executives turned the lack
of independent scrutiny to their own advantage. An examination of the
enforcement arm of the Securities and Exchange Commission certainly
bolsters this viewpoint. According to the General Accounting Office,
the SEC's workload grew by 80% between 1991 and 2000 while its staff
grew just 20%. Stock options The ascendancy of stocks as a keystone
in the finances of both companies and individuals is responsible. Increasingly,
executives have received part of their pay in stocks or stock options,
and companies have made financial arrangements that are based on the
value of their stock. The resulting incentive to inflate the prices
of a company's stock often conflicts with the goal of building a strong
company that will deliver real profits. More on the Meaning of the Crisis:
Bob Borosage of the Campaign for America's Future argues against the
"hangover" theory: "This bubbleology would allow conservatives to shirk
responsibility for what they have wrought. The fact is that after the
'excesses' of the 1920s drove us into the Great Depression, there was
no equivalent epidemic of financial and political corruption for 50
years until the current crime wave. That's because Franklin D. Roosevelt's
New Deal put cops on the beat to police corporations and regulate their
behavior." http://www.ourfuture.org/readarticle.asp?ID=1468 A commentator
at TomPaine.com suggests that Borosage doesn't go far enough: "The issue
is not simply one of saving capitalism from itself; it's also a question
of saving us from capitalism's extremes of exploitation and inequality.
We don't want to 'restore confidence in the stock market,' as both parties'
leaders keep intoning. That's like restoring confidence in the casino
after the little guys discover that the house and the big bettors always
win. We need to restore the real economy, not the hyper-speculative
stock market." http://www.tompaine.com/feature.cfm/ID/6012 THE TEAM
The Bush Administration has been widely described as the most business-friendly
administration in American history. Since Eisenhower's presidency, no
president has had more than one former chief executive in his cabinet;
Bush has four. At lower levels, an overwhelming proportion of the appointees
come from backgrounds in business rather than public service or academia.
White House spokespeople have long argued that the depth of business
experience reflected in Bush's cabinet allows for an intimate understanding
of the corporate world and a corresponding ability to make the necessary
fixes. But many of the former businesses of Bush's appointees have histories
of fraud and corporate crime. There are serious questions about whether
the administration is sufficiently distanced from the recent scandals
to offer real solutions. Here's a rundown of the corporate connections
(and past wrongdoings) of Bush's top brass: President George W. Bush:
Bush himself has recently come under attack for his actions as a director
of Harken Energy, a small oil company in Texas. After Bush sold millions
of dollars' worth of stock shortly before bad news sent the price plummeting,
the SEC opened an investigation. As economist Paul Krugman put it, the
investigation was "peculiarly perfunctory," but SEC officials promise
that the fact that Bush's father was president at the time had nothing
to do with it. Vice President Dick Cheney: Our previous Bulletin on
Cheney (http://www.moveon.org/moveonbulletin/bulletin1.html) offers
an in-depth description of Cheney's corporate ties. Halliburton, the
company Cheney ran between 1995 and the time he started working for
Bush, is currently under investigation by the SEC for illegal accounting
practices. Secretary of the Army Thomas White: As the former head of
Enron's energy-trading department and an 11-year Enron employee, White
may have known about the accounting tricks that led to Enron's disastrous
collapse. White only left Enron in May 2001; the division he headed
now appears to have hidden more than $500 million in losses. (See http://www.newsday.com/news/nationworld/nation/ny-uswhit282567672jan28.story
for more.) SEC Chairman Harvey Pitt: Appointed with the express approval
of Enron CEO Ken Lay, many prominent Democrats and Republicans (Senate
Majority Leader Tom Daschle and Senator John McCain, for example) have
called for Pitt to resign. Pitt was the accounting industry's lead lobbyist
until only a few years ago; his work was key in watering down proposed
SEC regulations that would have strengthened auditors' independence.
Pitt also continued to meet with several former clients after he was
appointed SEC Chair, which further blurred the line between Pitt's old
job as a lobbyist and his new one as a supposed enforcer. Larry Thompson,
Deputy Attorney General and head of Bush's Corporate Fraud Task Force:
In a bizarre twist, even the leader of Bush's new white-collar crime
task force has ties to corporate fraud. While he was a board member
of Providian Financial Corporation, state and federal police investigated
Providian for gouging consumers. The company ended up settling the cases
and investigations for more than $400 million. (See http://www.nytimes.com/aponline/national/AP-Thompson-Providian.html
.) These are just a few of the Bush Administration officials with ties
to corporations that are in hot water. Those with corporate ties (although
not necessarily to criminal ones) in the upper echelons of the Bush
Administration include Treasury Secretary Paul O'Neill, former CEO of
Alcoa; Defense Secretary Donald Rumsfeld, former CEO of General Instruments;
Commerce Secretary Don Evans, who ran the oil company Tom Brown; Secretary
of the Navy Gordon England, who worked for General Dynamics; and Secretary
of the Navy James Roche, who worked for defense contractor Northrup
Grumman. THE PITCH Worried about the political ramifications of looking
soft on white-collar crime, President Bush stepped up his efforts to
promote "corporate accountability" in the month of July. In a major
speech on July 9, Bush delivered a ten-point proposal for dealing with
corporate fraud. The wall behind Bush was emblazoned with the phrase
"Corporate Responsibility" in large white letters on a field of blue.
The Dow Jones Industrial Average dropped more than a thousand points
in the following two weeks, demonstrating that the speech had hardly
reinstalled confidence in the markets. Although many of the reforms
Bush suggested were enacted in the Sarbanes accounting reform bill discussed
below, the general tone of the speech hardly cast Bush as a corporate
crime crusader. The central argument went as follows: "A few bad people
have unleashed a series of scandals on us. By and large, most corporate
executives are good people, but they've been caught up in a culture
of greed that has made them complacent. Corporate execs need stronger
moral fiber -- and as for those few bad people, we need to catch 'em
and jail 'em." In his speech, Bush argued that "corporate leaders who
violate the public trust should never be given that trust again." But
given the number of high-ranking members of his administration who have
been involved in corporate scandals, it's difficult to take this exhortation
seriously. Bush's speech did have several interesting ideas: He challenged
CEOs to highlight their compensation packages in their companies' annual
reports, and make a case about why they deserve those earnings. He argued
that stock exchanges should require a majority of a company's directors
to be independent. In somewhat vague language, he said that stock analysts
must be stopped from touting the stocks of companies with which they
have contracts. These suggestions do little to dispel the underlying
concern that Bush's conflicts of interest make him incapable of providing
the solutions we need. As one commentator said, "Bush lecturing executives
about corporate responsibility is like Clinton talking about chastity
-- only Clinton had the sense not to." More on Bush's Pitch: The full
text of speech: http://www.cnn.com/2002/ALLPOLITICS/07/09/bush.transcript/index.html
A New York Times editorial: Ambrose Bierce's definition of the corporation
(quoted above) "came to mind when President Bush called for a 'new ethic
of personal responsibility in the business community' during his Wall
Street speech. Bierce would've been delighted at the coincidence." http://www.9-11peace.org/r2.php3?r=98
THE REAL SOLUTIONS The Enron scandal may have had politicians talking
tough, but by early summer even basic sensible measures for corporate
reform had not been enacted. After weeks of fierce lobbying by the accounting
industry and other groups (see http://www.opensecrets.org/news/accountants/accountants_topsenate.asp
for a list of the top Senate recipients of accounting money), Senator
Paul Sarbanes' (D-MD) reform bill was dying in committee. WorldCom's
astounding revelations of accounting fraud, and the precipitous drop
in stock markets that accompanied it, brought the legislation back to
life. It quickly passed the Senate, 98-0. After surviving a House-Senate
conference intended to reconcile it with a weaker House analogue, Bush
signed it into law on July 30th. The bill is the most sweeping overhaul
of accounting industry laws since the 1930s, when similar circumstances
prompted the first real regulation for audits. While it's not a panacea,
the Sarbanes bill addresses some of the most immediate problems that
have led to corporate fraud. Provisions in Sarbanes and other bills
soon to become law include: Tougher sentencing for white-collar criminals.
The bill increases the maximum jail time for wire and mail fraud to
20 years, a fourfold increase, and creates a new category of crime called
securities fraud. Expansion of the definition of corporate fraud. Restrictions
on the consulting services auditors can provide to audit clients. Highly
lucrative consulting gigs have often been cited as a major impediment
to auditor independence. Lengthening of the amount of time during which
lawsuits can be brought against corporations. The creation of a new
auditors' oversight board that would set and enforce auditing standards
for accounting. A requirement that CEOs and CFOs certify financial reports.
The executives would face perjury charges if they were shown to have
lied. The boosting the SEC budget by 66%. Even the staunch free-market
magazine The Economist, however, argues that the Sarbanes bill doesn't
go far enough. And many of the practices which led to a culture of "infectious
greed" haven't been remedied. Below is a sampling of some of the reforms
that have yet to be enacted into law. Stop offering government contracts
to companies that repeatedly break the law. Boeing, Raytheon, and GE
all have government contracts for billions of dollars; each has been
convicted of 24 or more violations of federal law. Some people suggest
that the "Three Strikes and You're Out" policy applied to street criminals
be applied to corporations as well. Under this scheme, corporations
which had committed more than three major violations of law would lose
their government contracts. According to the Project on Government Oversight,
"the government's 43 top contractors have paid a total of $3.4 billion
in fines/penalties, restitution, and settlements; sixteen of them have
been convicted of a total of 28 criminal violations. . . only one of
the 43 top contractors were ever suspended or debarred from doing business
with the government. That one suspension action, against General Electric,
lasted only five days, when typical suspension and debarment actions
last 18 months to three years." Require corporations to "expense" stock
options -- or to stop offering stock options altogether. A stock option
allows a person to buy a stock at a given price, even if the stock is
currently valued at a higher price. When corporations give executives
stock options the executives are clearly receiving something of value,
current accounting practice doesn't require that corporations count
this value as an expense. Given that many corporations give out tens
of millions of dollars' worth in stock options each year, the practice
can substantially distort a company's report. Some critics allege that
stock options don't offer executives the right incentives anyway. The
Economist describes the problem in a recent article: "Unlike stock itself,
a stock option has no downside: the owner might gain a lot of money
if his company's share price rises, but he loses only the cost of the
option if the share price falls (and nothing at all if the option is
given to him). . . . Combined with the freedom to sell the company's
stock once the option is exercised, stock options might also have encouraged
short-term business strategies, or even fraud. By fiddling with their
accounts, company bosses could hope to drive up the share price, cash
in their options, and set sail in their yachts." (See http://www.economist.com/business/displayStory.cfm?story_id=1235996
for the entire article) Appoint auditors through an outside party, or
require companies to change auditors every three years. While Sarbanes
restricts the degree to which independent auditors can serve as consultants,
it retains the current system under which corporations can choose their
auditor. More on Real Reform: Business Ethics magazine's lead editorial
suggests four tough ways to crack down on corporate fraud. "Toothless
codes of ethics like Enron’s are no help. Ethical concerns must grow
teeth – which means biting into reform of corporate governance. While
most proposals for reform today merely tinker at the margins, some get
to the heart of the matter. [Here] are four of the best." http://www.business-ethics.com/corporat.htm
Restore The Trust is an online campaign dedicated to accounting reform.
"The new laws will only work well if the Securities and Exchange Commission
appoints the right people to do the job. Once [the Sarbanes bill] is
signed into law, the SEC will have 90 days to appoint five members to
the new auditor oversight board set up by Congress. Send a free letter
to the SEC and others today, and tell them you demand strong investor
advocates, NOT accounting industry advocates, on the Board!" http://www.restorethetrust.org/
UDPATE: OPERATION TIPS Many thanks to the readers who alerted us to
Operation TIPS, an indication that the answer to the title question
of the last Bulletin, "Can Democracy Survive an Endless 'War'?" may
be "No." Following in the tradition of the Stasi secret police in East
Germany, U.S. Attorney General John Ashcroft is looking for a million
Americans who are willing to snoop on their fellow citizens. Letter
carriers, utility employees, and other workers who routinely have access
to living areas are being targeted. According to the official website
for the program (http://www.citizencorps.gov/tips.html), TIPS is intended
to "establish a reliable and comprehensive national system for reporting
suspicious, and potentially terrorist-related, activity." Not mentioned
on the website is the fact that according to current policy, information
reported through TIPS will be stored in Justice Department databases,
where it will be broadly -- and indefinitely -- available to other agencies
and local police forces. (See http://www.smh.com.au/articles/2002/07/14/1026185141232.html)
We agree with the Boston Globe: "Ashcroft's informant corps is a vile
idea not merely because it violates civil liberties in a narrow legal
sense or because it will sabotage genuine efforts to prevent terrorism
by overloading law enforcement officials with irrelevant reports about
Americans who have nothing to do with terrorists. Operation TIPS should
be stopped because it is utterly anti-American. It would give Stalin
and the KGB a delayed triumph in the Cold War -- in the name of the
Bush administration's war against terrorism." (Full op/ed reprinted
at http://www.commondreams.org/views02/0717-01.htm) ABOUT THE MOVEON
BULLETIN AND MOVEON.ORG The MoveOn Bulletin is a free, biweekly email
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MoveOn.org engages people in the civic process, using the Internet to
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of pressing issues, and coordinating grassroots advocacy campaigns to
encourage sound public policies.
BUSH IN CORPORATE CORRUPTION
The Daily Enron Florida Recount Funded by Enron/Halliburton The Bush
Family's Made Men Bush's Magical Mystery Tour JULY 30: If George W.
Bush were cast as a TV sitcom character he would have to be modeled
after ad man Darrin of Bewitched or Astronaut Roger of I Dream of Jeannie
- a hapless fellow whose success hinges almost entirely on the extraordinary
powers of others. And so it was when the presidency hung by a thread
in Florida during the last election. A contentious recount was underway
and the genies that had gotten Bush so far assembled en masse to assure
his victory over Al Gore. Only now are those last-minute efforts fully
becoming known. According to papers filed with the IRS on July 15, nearly
$14 million magically poured into the Bush/Cheney Florida recount effort
- four times the amount raised by the Gore/Lieberman camp. The money
flowed in so fast, and in such enormous chunks, that Bush campaign officials
- unaccustomed to Bush's perennial good fortune - were dumbfounded.
"I think we were a little bit stunned by the amount we received," Benjamin
Ginsberg, a Bush attorney for the recount, told USA Today. According
to IRS documents, the Bush campaign took in $13.8 million, most in large
contributions. Listed among those large contributors were Bush and Cheney's
two most reliable genies - Enron and Halliburton. While the Gore/Lieberman
campaign filed its IRS disclosures of their Florida recount expenditures
months ago, the Bush's recount fund filed the required forms at the
very last moment allowed by law. July 15 was the final day of an IRS
amnesty program for groups that hadn't already complied with the law.
"They obviously begrudgingly disclosed, and did it way after the fact,"
said Larry Noble, executive director of the Center for Responsive Politics.
"It's better than nothing, but it would have been better to have disclosed
it when the money was coming in." The filings show that as soon as a
recount was announced, Bush forces moved quickly. Money was no object.
They dispatched over 100 lawyers to Florida and Texas, booking hundreds
of plane tickets, rental cars and hotel rooms. Among the expenditures
listed was a payment of $13,000 to Enron Corp. and $2,400 to Halliburton
Co. for the use of their corporate jets and other unspecified services.
"Eighteen months after the election, we find that the (Bush) administration
literally flew into office on the Enron corporate jet," said Jennifer
Palmieri, press secretary for the Democratic National Committee. "The
administration's close ties with unscrupulous corporations like Enron
and Halliburton prevent it from showing real leadership on corporate
reform." Former Enron CEO Kenneth Lay and his wife also donated $5,000
apiece, according to the filings. George W. Bush trying to morph into
a business ethics professor is a bit like a Jessie Ventura trying to
pass as a prim and proper schoolmarm. It's at once amusing and painful
to watch. And, Americans are not buying the act. Numerous polls show
that voters continue to believe that George W. Bush is more in tune
with the wealthy and corporate interests than those of regular folk.
Almost weekly now some publication or another reveals another politically
connected, sweetheart deal that benefited either the President himself
or one of his brothers. This week it was the St. Petersburg Times, and
the focus was on brother Jeb Bush. It seems that back in 1989 (around
the same time he was in business with a now-fugitive HMO operator as
well as a convicted HUD borrower, and while Jeb was defaulting on a
$4.5 million loan from a failed Florida S&L) Jeb was also partners with
a fellow whose company is now under investigation for misappropriating
federal loan funds to Nigeria. That deal reared its ugly head again
this month when details became public thanks to a whistleblower and
a federal lawsuit. The lawsuit claims the company, MWI Corp., a water
pump manufacturer based in Deerfield Beach, FL, improperly used more
than one-third of a $74.3 million U.S. loan to pay bribes and kickbacks
to Nigerian government officials. Jeb Bush's business partner in the
deal was prominent Florida Republican contributor J. David Eller. Court
filings allege that Eller flew suitcases of cash to offshore tax havens
to hide assets from the deal. Jeb Bush was paid $648,250 by Bush-El,
a company he and Eller formed in 1988 to promote MWI's pumps. Eller
and his company have contributed more than $129,000 to the Republican
Party since 1989, according to the watchdog group Common Cause. The
old deal was given new light this month when Bush's former partner moved
to have all the court records of the ongoing suit sealed from public
view. Jeb Bush, who is not named in the federal suit, continues to claim
he had nothing to do with the Nigerian deals now in question. However,
court records show that twice while his father was in the White House,
Jeb Bush visited Nigeria on behalf of MWI. The Nigerians were so impressed
with the fact that the son of a sitting President of the United States
was associated with MWI that Jeb was welcomed by a parade of 1,300 horses,
and tens of thousands of people lined the road to welcome him. The St.
Petersburg Times also obtained a MWI marketing video, filmed around
the time of Jeb's 1989 visit, in which Eller brags that his company
has "support at the highest levels of our own government." The video,
made for the Nigerian market, featured pictures of Eller with then-President
George Bush. Eller also pointed out Jeb Bush's stake in the company.
"In fact George Bush's son will be coming to Nigeria with us for the
inauguration of our factory," Eller says on the tape. "And we're very
proud of that, and it shows that our government is very interested in
what we're doing in Nigeria and very supportive." The U.S. Export-Import
Bank eventually approved $74.3 million in loans to Nigeria expressly
to purchase MWI's pumps. Now federal prosecutors say that $28 million
of those loans was improperly used to grease the palms of Nigerian officials
and MWI insiders. The lawsuit cites one example in which MWI officials
brought "large quantities" of cash to the Abuja Hilton Hotel, where
they met with Nigerian officials. The MWI representatives left the meeting
without the money. The lawsuit is all that now remains of the deal as
the Bush Justice Department notified MWI in March that it had closed
a criminal investigation into the pump deals. The Department of Justice's
civil litigation division only recently joined a whistleblower lawsuit
when the whistleblower refused to drop the case. Ordinary citizens are
allowed under law to file suits in behalf of the US Government when
the government itself refuses to act. Now part of the civil action,
the Justice Department will be in a better position to determine its
outcome. ------------------------------------------------------------------------
Quote of The Day "The Bush administration, with its economic happy talk,
excessive corporate influence and unwillingness to grapple with a serious
new federal regulatory role, bears a resemblance to the GOP of the '20s.
Like the unlucky Herbert Hoover, George W. prefers business self-regulation
and volunteerism, which will prove inadequate if the crisis deepens."
Kevin Phillips, Los Angeles Times
THE SHAREHOLDER ISSUE
Questioning the Call for Shareholder Power By Russell Mokhiber and Robert
Weissman
If nothing else, the still-unfolding corporate scandals should free
us to think freely and creatively about corporate power, corporate form
and the rules governing corporate behavior. A common diagnosis of the
current scandals is that they can be traced to company executives' ability
to function with little accountability to shareholders. An alternative
view is that the problem was that executives were thinking too much
about what shareholders want. Of course, shareholders did not want CEOs
to steal from their companies and arrange bogus loans to themselves.
But the more serious accounting crimes -- projecting inflated profits
and revenue streams -- were arguably a result of what shareholders did
want: short-term profits and other indicators that raise share prices,
especially in the short term. Marjorie Kelly is an adherent to this
second interpretation. Kelly is the author of The Divine Right of Capital:
Dethroning the Corporate Aristocracy (www.divinerightofcapital.com),
and editor of Business Ethics magazine. Starting in the late 1980s,
she points out, "shareholders got precisely what they wanted. The Enron
and attendant scandals hold some interesting lessons. We think of this
as a situation where shareholders got harmed, but forget that leading
up to it, shareholders got precisely what they wanted. The financial
elite got complete alignment between CEOs and shareholders through stock
options, they got the removal of a regulatory regime to a large extent,
and they got a rising stock market -- all the things that they wanted
-- and yet it imploded." "People are saying we need to align executives
closer to shareholders," she says. "I believe their alignment was too
close. We need a corporation that is accountable to someone besides
shareholders." Moreover, Kelly says, shareholders do not deserve to
exert control of the corporation. Shareholders contribute very little
to the company. But for initial public offerings (IPOs) and other sales
of new company stock, none of the back-and-forth trading on the stock
exchanges contributes new money to the company. Indeed, Kelly notes,
in 15 of the last 20 years, corporations have spent more on stock buybacks
than shareholders have invested in new equity. For the one-time contribution
to corporations at their founding, or at the placement of shares on
the market, shareholders gain perpetual absolute control of the corporation.
Recognizing the minimal contribution of shareholders, says Kelly, leads
away from questions about enhancing shareholder power, and instead to,
"Is any amount of return ever enough for a one-time hit of money? Or
must a company have as its single-minded purpose, forever, that it will
move heaven and earth to create return for that one-time gamble?" Kelly
suggests a range of alternatives to the entrenchment of shareholder
power and privilege. One of her most provocative suggestions is time-limited
shareholding. One approach would be to dilute shareholder control progressively
over time. Residual control could be lodged in employees, or a public
entity. Or the for-profit corporation could morph over time into a non-profit
enterprise -- a reversal of the current trend to convert not-for-profit
and mutual insurance companies (such as Blue Cross) to for-profit status.
All of this is far from immediate enactment, of course. But it is nonetheless
worth assessing as a conceptual tool, and perhaps as a long-term project,
to move business enterprises out of the shareholder-dominated and for-profit
paradigms, to a place where new values may govern their operations.
One place where such conversions might be contemplated first is at the
point of least shareholder power, in bankruptcy -- a place where more
and more corporations are sure to find themselves in the months ahead.
Russell Mokhiber is editor of the Washington, D.C.-based Corporate Crime
Reporter. Robert Weissman is editor of the Washington, D.C.-based Multinational
Monitor, http://www.multinationalmonitor.org. They are co-authors of
Corporate Predators: The Hunt for MegaProfits and the Attack on Democracy
(Monroe, Maine: Common Courage Press, 1999; http://www.corporatepredators.org).
(c) Russell Mokhiber and Robert Weissman This article is posted at:
http://lists.essential.org/pipermail/corp-focus/2002/000123.html _______________________________________________
Focus on the Corporation is a weekly column written by Russell Mokhiber
and Robert Weissman. Please feel free to forward the column to friends
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us (russell@essential.org or rob@essential.org).
REFORMS DO NOT CHANGE CAUSAL STRUCTURES OF CRIME
CORPORATE CRIME TIME By Russell Mokhiber and Robert Weissman In signing
corporate reform legislation on July 30, President Bush said that the
new law "says to every American: there will not be a different ethical
standard for corporate America than the standard that applies to everyone
else." The corporatists apparently took this as a challenge from their
fearless leader. Since the signing, they are working overtime to prove
him wrong. Let's start with the editorial page of the Wall Street Journal.
In an editorial on August 8 titled "Corporate Crime Blotter," the Journal
justifiably ripped into Adelphia's Rigas family, ImClone's Samuel Waksal,
Martha Stewart, and former Tyco boss Dennis Kozlowski for inflicting
"enormous harm" on "the markets and the cause of liberty." But then
get the conclusion: "The faster individual law-breakers can be punished,
the sooner any public taint over honest business will be lifted." Note
the focus on individual law-breakers. What about the corporate criminals?
Leave it to the Journal editors to write a column about "corporate crime"
and then leave out any discussion of corporate crime. Bob Bennett, brother
of the ethicist and better known Bill, is a leading inside-the-beltway
corporate criminal defense attorney. He's Enron's lead attorney. Bennett's
job: makes sure Enron, the corporation, doesn't get indicted. If he
has to offer up to prosecutors Enron executives in lieu of the corporation,
so be it. At the National Press Club this week, Bob floated the idea
that we should seriously question the whole idea of corporate criminal
liability. "The concept of corporate criminal liability has not gotten
enough attention," Bennett said. "When you indict a company, you are
doing enormous damage to its stock. You are doing enormous damage to
innocent people. When a company gets indicted, it has a real impact
on them. I really question the value of that. Why you would hobble a
company trying to come out of bankruptcy? What do you get from that?
Is it just this macho -- we indicted so and so? Why do that harm?" Bennett
made clear that, as Enron's attorney, he was cooperating with federal
prosecutors to make sure that responsible Enron executives were brought
to justice. "We are fully cooperating with the Justice Department, we
have waived the attorney/client privilege," he said. "And some damaging
memos have come out that have impacted individuals." In June 1999, when
he was with the Justice Department prosecuting crime, Eric Holder wrote
a memo (known as "the Holder memo") to give guidance to prosecutors
on when and when not to indict a corporation. Citing that memo, Holder,
now in private practice defending corporations, last month argued that
"on balance, and based on what is at least publicly known, it is difficult
to see the case for WorldCom being charged." ("Don't Indict WorldCom,"
by Eric Holder, Wall Street Journal, July 30, 2002). As Holder knows
better than most, what is publicly known of a criminal investigation
of this magnitude before a decision is made on whether or not to charge
a company is virtually nothing. According to the Holder memo, in deciding
whether or not to criminal indict a corporation, prosecutors must consider
the pervasiveness of the wrongdoing within the corporation, including
the complicity in, or condonation of, the wrongdoing by corporate management.
They must also consider whether the corporation cooperated with prosecutors,
the adequacy of a corporation's compliance programs, and the corporation's
remedial actions. There is virtually no public information on any of
these factors, and yet Holder finds it difficult to see a case for criminal
prosecution of WorldCom. Holder argues today that if the Justice Department
indicts the culpable individuals at WorldCom ? which it did just days
after Holder's article appeared in the Journal, the case for bringing
charges against the company is greatly weakened. Why? "Because under
the guidelines, the degree to which current management has cooperated
with the government and dealt with those who engaged in wrongdoing must
be factored in," Holder writes. But in his own June 1999 memo, Holder
writes that: "a corporation should not be able to escape liability merely
by offering up its directors, officers, employees, or agents in lieu
of its own prosecution." This is a practice that is common among corporate
defense counsel ? offer up the executives to save the company's hide.
Is this the strategy we are now seeing put into place by Bennett for
Enron, and by defense attorneys for WorldCom and Adelphia? (In the Adelphia
case, the executives were charged with crimes and arrested at their
homes before a media mob ? and with the arrests announced at a White
House press briefing -- while the corporation was only charged by the
SEC with civil fraud.) In making his case against a criminal charge
against WorldCom, Holder says that he focused on collateral consequences
? the workers who will be thrown out of work and the innocent shareholders
who will lose money ? if as a result of an indictment, the company is
put out of business. First of all, whether the shareholders are innocent
in these cases is an open question. After all, they are the owners of
the company and they have nominal control. Second, it is not clear that
a criminal conviction would put WorldCom out of business. But if it
might, the question about workers is a good one. Perhaps where companies
face extinction as a result of a corporate criminal prosecution, the
companies should be thrown into public receivership ? as happens with
criminal unions ? or assigned a corporate appointed monitor -- as was
the case when Consolidated Edison was convicted of environmental crimes
in November 1994. Corporations, their defense attorneys and lobbyists
are swarming all over Washington seeking to save their collective hides.
They wish to preserve the double standard that President Bush says the
new law will eliminate. They must be defeated. Russell Mokhiber is editor
of the Washington, D.C.-based Corporate Crime Reporter. Robert Weissman
is editor of the Washington, D.C.-based Multinational Monitor, http://www.multinationalmonitor.org.
They are co-authors of Corporate Predators: The Hunt for MegaProfits
and the Attack on Democracy (Monroe, Maine: Common Courage Press, 1999;
http://www.corporatepredators.org). (c) Russell Mokhiber and Robert
Weissman This article is posted at: http://lists.essential.org/pipermail/corp-focus/2002/000124.html
_______________________________________________ Focus on the Corporation
is a weekly column written by Russell Mokhiber and Robert Weissman.
Please feel free to forward the column to friends or repost the column
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MONOPOLIZING WATER
Hightower's article on water profiteers is alarming, the moreso because
of this other article from '99, posted below, which shows close connections
between Tom Ridge, George H.W. Bush, and water profiteers. Barry Gan
[ Error! Bookmark not defined. ] You don't have to crack the latest
annual report of the American Water Works Company to figure out that
this is a hungry corporation. By Mark Worth Or, better put, thirsty.
That one word, "More"--printed underneath an eerily computer-altered
picture of a glass of water--says it all. American Water Works, which
counts Cal-Am among its country-spanning network of 23 subsidiaries,
wants more of just about everything. More water, because the 257 billion
gallons it sold last year isn't enough. More customers, because its
10 million ratepayers isn't enough. More revenue, because the $1.02
billion it took in last year isn't enough. More profits, because the
$127 million it cleared isn't enough. Here in Monterey County, American
Water Works--AWW, for short--wants to get more of those things by raising
rates and building a new dam on the Carmel River. Unlike the dam that
voters rejected in 1995, this one would be a "no-growth" dam--or so
Cal-Am officials have promised with cross-your- heart sincerity. Upon
deconstructing AWW's corporate behavior, however, one would have a hard
time believing Cal-Am's parent company would get involved with anything
that wasn't going to grow--a lot. For those who didn't realize Cal-Am
even had a parent company, don't feel bad. In the 33 years since AWW
came to town, Cal-Am officials have wanted you to think of them as your
neighbors. They work in an office in Monterey, all right, but the "California-American
Water Company" exists only as four words at the top of your water bill
and as a line-item in AWW's annual report. Cal-Am and the American Water
Works Company are one and the same. And when the parent tells its offspring
to jump, Cal-Am dutifully asks how high. As the putative leader of the
nation's private water industry, AWW is heading a campaign to privatize,
deregulate, and consolidate the U.S. water system. Here on the Peninsula,
Cal-Am is doing its part--by eyeing and snapping up small public and
private water systems, and by eyeing and trying to snap up permits that
the Monterey Peninsula Water Management District holds for a new Carmel
River dam. Cal-Am is doing the legwork, but the orders are coming straight
from New Jersey. Judging by the way AWW goes about its business, it's
little wonder that Cal-Am has worked so diligently to maintain the masquerade.
Rip off the mask, and you'll see the face of a corporation that just
might scare you. Headquartered across the Delaware River from Philadelphia
in Voorhees, New Jersey, the American Water Works Company is the largest
private water company in the United States--by far. It pumps and pipes
more than a quarter-trillion gallons of a water a year to 10 million
people living in about 1,000 communities scattered throughout 23 states--of
which you and yours is but one. By all accounts--including those of
its own executives--AWW is one of the most aggressive, politically active,
profit-driven utilities in the country. For starters, the haughty water-industry
trade group headed by AWW's CEO--the oft-described affable J. James
Barr--thinks water companies shouldn't have to spend more than $10 million
to rid water of a certain contaminant unless doing so could save someone's
life. Translation: If it would cost companies like AWW more than $10
million to save a life by improving water quality, then that person
should be allowed to die from drinking bad water. Translated further:
Your life, according to the private water industry, isn't worth more
than $10 million. Like virtually all gigantic corporations, AWW has
figured out that you can't do big business in America without getting
your hair mussed once in a while. For nearly a year, the mayor of Chattanooga--whose
drawling chief of staff refers to AWW execs as "sons o' bitches"--has
been battling a multimillion-dollar legal and public-relations campaign
aimed at stopping him from wresting the city's waterworks from AWW's
Tennessee subsidiary. And four years ago, in Orange County, Calif.,
Cal-Am President Ted Jones Jr. tried what was believed to be the first-ever
hostile takeover of a public, taxpayer-owned agency by a private, stockholder-owned
company. Jones and his crew of lawyers and accountants failed, suffering
public tongue-lashings in the process. "Many cities find it's a very
emotional issue to sell their water systems," deadpanned Barr to Chief
Executive magazine in July. AWW execs, however, aren't easily humbled.
And they aren't accustomed to losing, either. The company has absorbed
about 100 small water providers during this decade alone, many of them
discovered by "scouts" who literally cruise backroads--sometimes driving
more than 1,000 miles a week--in search of impoverished water systems
to snatch up. So, where does your money go after it's sent to Voorhees,
New Jersey? Some of it goes to former President George Bush, whose copious
investments are handled by a venture-capital firm that owns a huge chunk
of AWW stock. Some of it goes to the Republican National Committee.
AWW Chairperson Marilyn Ware, a rising star in the expanding galaxy
of female corporate executives, is a top GOP soft-money contributor
and high-profile Republican operative. In a recent interview, Ware said
one of her favorite hobbies is "studying and collecting people." Like
Cal-Am's water, all of this may be leaving a strange taste in your mouth.
Attempts to reach Barr and Ware for an interview were unsuccessful.
AWW spokesperson Kathleen Rohrbaugh said she did not want to discuss
the company's overall business practices, referring the Weekly to Cal-Am.
"The feeling here [in New Jersey]," Rohrbaugh said, "is that we'd like
to keep this a local story." Gulping It Down American Water Works traces
its roots to the American Water Works & Guarantee Company, founded in
1886, busted by antitrust legislation in 1935, and bought in 1947 by
a former paperboy and teenaged electrician from Philadelphia named John
H. Ware, Jr. Ware, and later his Republican Congressman son, grew the
business by what today is known as "mergers," but what were then good
old-fashioned buyouts and takeovers. The company has been buying out
and taking over ever since. Since 1990, AWW has swallowed up as many
as 22 water systems a year, mainly private companies but a few taxpayer-owned
systems as well. In 1996, AWW swung the largest buyout in the industry's
history, corralling Pennsylvania Gas & Water--and its 400,000 customers--for
$409 million. Around this time, rumors began trickling into business
publications that J. James Barr, Marilyn Ware, and other AWW execs were
trying to romance an electric company into taking them over. The electric
utility industry had been substantially deregulated in 1992, and water
companies like AWW wanted to cash in by cashing out. As AWW grew, so
would the potential price tag. With this subtext not too far beneath
the surface, AWW outdid itself--twice. In June, the company paid $700
million for National Enterprises of St. Louis, along with its 1.5 million
Midwestern customers. And, just last week, AWW plopped down $835 million
for Connecticut's 1 million-customer-strong Citizens Utilities, whose
ratepayers include 55,000 people in Sacramento and a few thousand more
in the Bay Area. Absorbing the new customers will be Cal-Am, which,
besides the Peninsula, also does business in Coronado, the San Gabriel
Valley, and Ventura County. While perfecting the blockbuster deal, AWW
has also mastered the pint-sized buyout, like the Oahu wastewater system
and New Jersey business park the company recently enveloped. Via Cal-Am,
AWW has acquired several small but strategically important Carmel Valley
operations in recent years and is eyeing several others locally, including
the city of Seaside's system. "Circumstances," Barr told Chief Executive,
"have forced smaller systems into our arms." Those circumstances essentially
can be boiled down to this: a profit-minded corporation capitalizing
on well-funded, water-industry rhetoric that is beginning to convince
private water companies that consolidation is inevitable, and public
water systems that taxpayers don't want to pay for infrastructure improvements.
Just like the transformation of the electric-utility and telecommunications
industries, barely a word of skepticism has managed to trickle into
the debate. When the last of its 20-some pending deals goes through,
AWW's customer base will near 11 million. By then, the number of publicly
traded water companies will have shrunk from 17 just three years ago
to about 10. "Ultimately," Barr told a New Jersey business publication
last year, "the bulk of the industry will consist of [private] investor-owned
and a few major city-owned systems." Barr may be right. Bigger, so the
trend undeniably seems, is better. In the water world, the number of
small systems fell 10 percent in the past decade, while large systems
grew by 40 percent. "The momentum in favor of consolidating," Barr told
Barron's in August, "is stronger then ever." Privatize This About 8
out of 10 Americans get their water from public water systems. This
means that private water companies like American Water Works are missing
out on a big piece of the $30 billion annual water pie. Margaret Thatcher
privatized England's water system 10 years ago. France is three-fourths
of the way there. Argentina, Australia, Chile, and Italy are catching
up. Is the U.S. next? Barr, Ware, and AWW's 45,000 stockholders would
certainly like it to be. Though it's been a slow process, Barr seems
happy with the way things are going. "It's thrilling to watch America's
water become privatized," the CEO told Chief Executive, "especially
in our company's hands." Barr thought the Santa Margarita Water District
of Orange County would fall into his company's hands. Which may explain
why AWW put out a press release on the takeover attempt even before
a state law making such an attempt possible took effect. "I was visited
by about a dozen suits who basically said, 'Get out. We're taking over.'"
So the district's general manager, John Schatz, remembers that Friday
afternoon in May 1994, when a team of Cal-Am execs walked into his Rancho
Santa Margarita, Calif., office and dropped the bomb. "It was a stealth
effort," says Schatz, just five months on the job at the time. "I was
besieged by the sheer number of them. I felt like Butch Cassidy in that
movie." Thanks to a well-timed change in state law, Cal-Am, if it collected
enough signatures, could ask that the water district be dissolved. All
went according to plan at first, as Cal-Am got the signatures--with
the help of paid workers and volunteers--and filed the paperwork. "They
ran a pretty strong campaign," says Schatz. "They were coming after
us pretty hard." Cal-Am came hard but, as it turned out, not hard enough.
After more than a year of study, scores of heated letters to the editor,
and several even more heated public hearings, Cal-Am's $300 million
hostile-takeover bid--reportedly the first of its kind in the U.S.--failed.
Cal-Am President Ted Jones Jr. told the Weekly he "never felt it was
fair" for the company's effort to be labeled a hostile takeover. This
debacle aside, AWW has notched a few privatization victories of late.
In 1995, citizens of Howell Township, N.J., voted to sell their waterworks
to AWW for $35 million. Last year--with the help of a low-interest,
$2.2 million loan from the state--AWW bought a 300-customer system in
Clarion, Penn. And earlier this year, the people of Brimfield, Ill.,
voted 224-57 to privatize its like-sized water system. Taking some of
the joy out of those wins, however, is a nasty situation that erupted
in Chattanooga. After a squabble over AWW's fire hydrant fees, Mayor
Jon Kinsey wondered why the city had a private water company in the
first place. After discovering AWW's franchise may have expired, Kinsey
asked the courts to condemn the company's property--pumps, pipes, and
all--through eminent domain and award it to citizens. Billion-dollar
corporations don't take such challenges lying down. AWW hired one of
the slickest multinational P.R. firms there is, New York City's Burson-Marsteller--
self-proclaimed experts in "perception manage- ment"--to whoop up public
opposition against the mayor. A string of TV ads slammed Kinsey, using
unflattering pictures of him, to boot. "These sons o' bitches...they
have spent millions of dollars on one of the most disruptive campaigns
that one could imagine," says Kinsey's chief of staff Ken Hays. "It
is an unorthodox amount of money that they're spending to basically
put out mistruths." Uglier still, a researcher hired by Burson-Marsteller
blew the whistle after the firm asked her to "dig up dirt" on Kinsey
and Hays, a former aide to President Jimmy Carter. Juicier yet, it turns
out that a top Burson-Marsteller executive once worked as a Republican
Party fundraiser--perhaps no coincidence, given AWW Chairperson Marilyn
Ware's political affinities. The whole mess finally blew up in the Washington
Post in May under the headline, "Chattanooga Boo-Boo." An agreement
to end the dispute was reached at press time and awaits City Council
approval. Despite his company's privatization blitz, Barr made a revealing
confession in a recent speech to government regulators: "I doubt the
consumer will be well served if we go that route." When forced to make
a choice between the consumer and the company, however, Barr said "the
interests of the shareholders" come first. In his own words, Barr explains
the No. 1 difference between "private" water and "public" water. In
the former, shareholders run the show. In the latter, it's the taxpayers.
Accordingly, if you're a Cal-Am customer with a complaint that the company
isn't addressing, you've got to call the state agency that regulates
private water companies--the Public Utilities Commission in San Francisco.
If you get your water from the government and you have a complaint,
however, you could simply toddle down to city hall and give the mayor
and city council an earful. If you work for a water system, you, too,
might be happier in the public rather than the private sector. Government-owned
systems employ 3.5 workers per 1,000 water connections, more than twice
the level in the private world. And, salaries make up more than a third
of public systems' budgets, nearly three times the rate in the private
sector. Details aside, here's the question that citizens have to ask
themselves: "Who do I trust more to handle my water--people who work
for me or people who work for stockholders?" How Much Is Your Life Worth?
There's a lot more to running a water company than damming, pumping,
treating, and piping water. Like any government-regulated business,
you have to schmooze members of Congress, get laws amended in your favor,
keep pesky lawsuits at bay, that sort of thing. By the private water
industry's own admission, it is "enjoying unprecedented success in numerous
initiatives." Taking most of the credit is the industry's Washington,
D.C.-based trade group, the National Association of Water Companies.
And no one benefits more from the NAWC's success than the American Water
Works Company, whose CEO J. James Barr, is the group's long-time chairperson.
With little doubt, Barr, Ware, and every other water exec in the country
is most worried about changes Congress made to the Safe Drinking Water
Act in 1996. Though generally happy with the changes themselves, the
water industry wants to make sure that when they're written into law,
they don't go overboard. Translation: They don't want the cost of treating
water to cut too deeply into their profits. Remember the Pinto? The
car with the exploding gasoline tank? It turns out that Ford execs knew
about the problem but decided it would be cheaper to settle lawsuits
filed by injured Pinto drivers--and the families of dead ones--than
it would be to fix the defect. In the corporate world, it's called "bean-counting."
Just as Ford chose to pursue profits rather than protect life, the water
industry is doing some bean-counting of its own. Today, they call it
"cost- benefit analysis." The Barr-led NAWC thinks water companies shouldn't
have to spend more than $10 million to remove a given contaminant from
water unless going to the trouble and expense--at least theoretically--could
save someone's life. Said another way, Barr's trade group thinks the
value of a human life is no more than $10 million; spending more than
that on water purification isn't worth it--period. Writing in the NAWC
magazine Water last year, Executive Director Peter Cook put it this
way: "The generally accepted range is roughly $2-10 million per excess
fatality avoided." (Back in the 1970s, Ford attorneys came up with $200,725.)
"Doing a calculation on the cost of a human life and on the cost of
illnesses that shorten your life," says a congressional staffer familiar
with NAWC lobbyists, "is a very unfortunate, crass way of looking at
it." Barr's NAWC, in fact, doesn't even want the government to consider
regulating a certain contaminant unless, in Cook's words, it is "likely
to pose a significant national public health threat." Doing otherwise,
Cook says, would be tantamount to "wasting drinking water resources
to conduct extensive and detailed health studies on a contaminant."
Making the nation's water supply safe for contaminants that could sicken
or even kill people--while not wasting water on extensive health studies--is
just the beginning of private water's lobbying campaign. Among its many
initiatives, the NAWC wants Congress and the Clinton administration
to: -- Make it tougher for people sickened by contaminated water to
sue their water company. A recent spate of lawsuits in Northern and
Southern California, an NAWC rep testified to Congress last spring,
"could threaten the financial stability of the water system across the
country." -- Give private water companies access to low-interest government
loans previously available only to taxpayer-owned water systems. --
Make it easier for cities and counties to privatize their water systems,
loosen certain labor laws, and generally deregulate the water industry
a la the airline, telecommunications, and electric-utility industries.
Despite--or perhaps, because of--such positions, American Water Works
was named the "Environmental Company of the Year" in 1998 by the New
Jersey Technology Council. Profits Runneth Over As one could surmise,
American Water Works is a company on the move. Stock analysts, normally
a reserved lot, have found themselves using ever-more colorful language
to describe AWW's attractiveness to investors. "This is an exciting
time in the industry," one said recently. "I'd say you could buy these
stocks and sleep at night." A quick trip through a decade's worth of
AWW's annual reports--some with cover photos of canoeing couples and
fountain-sipping children--shows why: -- Corporate profits grew to $127
million last year, up 10 percent from 1997 and more than doubling since
1988. -- Water revenues expanded to $997 million, up 6 percent from
1997 and doubling since 1988 despite the fact that, over the period,
AWW's customer base rose by only 31 percent and water-volume sales edged
up only 15 percent. -- Residential sales grew to $575 million, double
the 1988 figure despite only a 21 percent increase in the amount of
water used by residential customers. -- While the typical customer's
yearly usage actually fell by 12 percent from 1988-98, AWW's revenue
per customer rose from $337 to $513--more than a 50 percent increase.
During the period, the company nearly doubled what it charged per gallon
of water, from just over two-tenths of a penny to a little under four-tenths
of a penny. -- AWW isn't shy about raising rates. It boosted water bills
by $17 million in 1995, $63 million in 1996, $53 million in 1997, and
$10 million last year. Here, Cal-Am has asked state officials to increase
rates by $4.6 million over the next three years. That would be the 13th
rate hike since 1970; only once--last year--has the state rejected a
proposed rate increase. (Nationally, private water companies asked for
an average rate increase of 30 percent for the quarter ending March
31, receiving an average of an 11 percent hike.) -- AWW's stock prices
grew nearly fourfold from 1988-98, from $8.56 a share to $33.75. Soaring
stock prices aren't just good news for AWW execs like Barr and Ware.
It's also good news, naturally, for the corporation's investors. Among
them is the Bessemer Group, the New Jersey-based venture-capital firm
that handles former President Bush's money, along with the investments
of 45 "Fortune 1,000" CEOs and several former U.S. Treasury secretaries,
including Lloyd Bentsen, Nick Brady, and Don Regan. Founded in 1907
with the proceeds Andrew Carnegie partner Henry Phipps reaped when Carnegie
Steel was sold to J.P. Morgan, the Bessemer Group owns 6.7 million shares--or
8.3 percent--of AWW stock. Bessemer, whose publications include A Guide
to Investing for the Wealthy, won't talk to you unless you have $5 million
to invest. All told, it manages some $25 billion in investments on behalf
of 1,100 clients. Quite literally, George Bush's fortunes rest, though
in very small part, on whether Cal-Am wins permission to build a new
dam on the Carmel River. The People Behind the Pipes Whether you're
happy or angry about being a Cal-Am customer, you have John H. Ware
Jr. to thank. A self-taught electrician in Philadelphia, Ware went on
to buy a steam railroad, the Northeastern Water Company, and, in 1947,
the American Water Works Company. His son, the Wharton School-educated
John H. Ware III, took over for his pop, serving as AWW's chairperson
and going on to serve in the Pennsylvania Senate and in Congress. Upon
his death at age 88 two years ago, Ware was honored in Harrisburg as
a "political giant" whose advice was sought by governors and presidents,
including George Bush. Carrying on the family tradition of parlaying
business success into political influence is John Ware III's daughter,
Marilyn Ware, AWW's chairperson since 1988. At 56, Ware seems to be
hitting her stride. Eleven years after chairing President Bush's statewide
campaign, Ware made Fortune magazine's list of George W. Bush's major
fundraisers. Her personal $100,000 contribution to the Republican Party
in 1997 placed her among the top 30 soft-money donors, ahead of Boeing,
Dow Chemical, and PG&E. Ware is tight with Pennsylvania's Republican
governor, too, serving as Tom Ridge's campaign chair and, with the rest
of her family, kicking in $210,000 to his 1994 election fund. Along
with Italian opera and gardening, Ware listed "politics as a contact
sport" as a favorite hobby in a recent interview with Chief Executive.
Despite reading seven newspapers a day, Ware has time to serve as a
trustee of the American Enterprise Institute, a conservative think-tank
whose board also includes Steve Forbes and executives from American
Express, Coca-Cola, Motorola, and State Farm. She also serves on the
boards of CIGNA Insurance and PP&L Resources, a large electric-utility
company based in Allentown, Penn. (an appointment that fueled merger
speculation). Earlier this year Ware received top awards from the Ms.
Foundation for Women and the Philadelphia Chamber of Commerce. When
she's not driving her Mercedes, Ware sometimes drives a flatbed truck,
though she doesn't have to. She personally owns 9.6 million shares of
AWW stock--12 percent of the total--worth about $275 million (as of
this week). Collectively, Ware descendants--including the four siblings
and cousins who serve on AWW's board--reportedly hold more than 20 percent
of the company's shares, about a half-billion dollars' worth. The person
responsible for keeping Ware's stock afloat is a Lincoln man. Before
driving his silver Towncar to work, CEO J. James Barr gets up at 3 or
4 in the morning, cracks open his briefcase, and starts thinking. When
he's not trying to turn struggling water companies into profit-making
enterprises, the 58-year-old AWW lifer can sometimes be found with a
Tom Clancy novel or a joystick in his hand. He used to fly more, but
nowadays he enjoys flight-simulator computer games. Barr is following
in the footsteps of his father, John J. Barr, an AWW exec from the 1950s
to 1980s. But Barr the younger disavows any favoritism; he started as
a radio dispatcher and worked his way up, he insists. Nearly 40 years
later, he's earning $700,000 a year (thanks to a 22 percent raise last
year) and keeping an eye on his own 740,000 shares of AWW. Rubbing Elbows
Besides electoral politics, large corporations are prone to involve
themselves with organizations that share their particular political,
economic, and social value systems. American Water Works is no exception.
AWW is a financial backer of the Reason Foundation, a Los Angeles-based
libertarian organization that is at the forefront of the corporate-sponsored
privatization and deregulation movement. Also bankrolling the group
are the likes of Bank of America, the Chemical Manufacturers Association,
Coca-Cola, Exxon, Ford, General Motors, Microsoft, Proctor & Gamble,
and Shell Oil. AWW is also a sponsor of the National Council for Public-Private
Partnerships. Founded in 1985 in Washington, D.C., the group describes
itself as a "catalyst for privatization activities at all levels of
government." Other sponsors include consulting giant Arthur Anderson
and ubiquitous accounting firms Deloitte & Touche and PricewaterhouseCoopers
(AWW's accountant). AWW is also a benefactor of Women Executives in
State Government, founded in 1983 to help women serving in state government
to understand issues such as public-private partnerships. Other sponsors
include pharmaceutical giant Glaxo Wellcome, defense contractor Lockheed
Martin, Nike, and cigarette makers Philip Morris and RJR Nabisco. And,
Elizabeth Hucker, an executive with the Ware family's business, serves
on the advisory board of Space Vest. The $100 million-plus venture-capital
firm invests in corporations pursuing the commercialization of space.
Among the initiatives the Virginia-based outfit has funded is the use
of satellites to find natural resources--a breakthrough technology that
may be in demand sooner than later. Turning Droughts into Dollars If
you think there's a water crisis here in Monterey County, consider yourself
lucky. Thirty-one countries with a total population of a half-billion
people suffer chronic water shortages for all or part of the year. In
China the water table is falling 5 feet a year. In India, where the
population is growing by 18 million people a year and will reach a billion
any day now, people are emptying aquifers at double the recharge rate.
By 2025, when the Earth's population is expected to reach 8 billion,
3 billion people won't have enough water. Overall, there is no more
fresh water on the planet than there was 2,000 years ago, when the population
was 3 percent of today's 6 billion. The situation is so desperate that
Jordan may take water from the Red Sea, canal it to the Dead Sea, harness
the elevation difference to drive a hydropower/desalination plant, and
then use the brine to restore the level of the Dead Sea. Crazy stuff.
Not so crazy, though, for multinational chemical conglomerate Monsanto
to try to make a buck. Monsanto execs think they can bring in $400 million
a year by entering the water business, starting with India and Mexico.
As a European financial official recently put it, "Water is the last
infrastructure frontier for private investors." Water Power If this
is true, then few should expect the American Water Works Company--via
its local subsidiary, Cal-Am--to back down from the people, the environmental
advocacy groups, or even the government agencies that don't want to
see a new dam built on the Carmel River. To the company and its shareholders,
water simply equals money. As CEO Barr said himself in a recent speech,
"I am a businessman who happens to be the chief executive officer of
American Water Works Company. My responsibility is to create value for
shareholders of the company." The Monterey Peninsula Water Management
District, which is staging a potentially history-shaping election next
Tuesday, holds permits for a new Carmel River dam. Voters, by nearly
a 3-2 margin, stopped the district from building it four years ago.
Cal-Am execs weren't all that impressed by the gesture. Even before
the election, they made it clear they were going ahead with the project--voters
be damned. Now Cal-Am execs want those permits to build a dam of their
own, perhaps by paying the district through a "public-private partnership."
Exactly how they propose to get the permits--especially if the water
board undergoes an anti-dam transformation--has been the subject of
sparse public discussion. Billion-dollar corporations, however, more
often than not manage to find solutions to such challenges. Regardless
of whether AWW and Cal-Am should be stopped, the question for folks
around here is: Can they be stopped? Error! Bookmark not defined. |
Error! Bookmark not defined. ©Coast Weekly The entire contents of www.coastweekly.com
are Copyright © 2000. Coast Weekly is a California corporation based
in Monterey County, California. For information on obtaining rights
to republish any information on this site contact Error! Bookmark not
defined. or call (831) 394-5656.
MONOPOLIZING WATER
The Water Profiteers by Jim Hightower The Nation http://www.thenation.com/doc.mhtml?i=20020902&s=hightower
here's the Department of Homeland Security when we really need it? I
suppose that Homeland czar Tom Ridge is too busy with his color codes
and his TIPS snitch patrols to notice or care that dozens of American
communities presently find themselves under assault by foreign powers
with names like RWE, Suez, Vivendi and Perrier. These global corporate
raiders are grabbing for our most essential public resource: water.
In just the past few years, such transnational conglomerates (along
with such US players as Bechtel, T. Boone Pickens, Monsanto and, until
recently, Enron) have quietly privatized all or part of the water delivery
systems in Atlanta, Berlin, Bolivia, Buenos Aires, Casablanca, Chattanooga,
Houston, Jacksonville, Jersey City, Lexington, Ky., Peoria, San Francisco
and many other places (some of which have reverted to public ownership),
plus laid claim to whole bodies of water, including the Midwestern Ogallala
Aquifer, Blue Lake in Alaska and Canada's huge James Bay. The water
profiteers are seizing control by using weaselly politicians, campaign
contributions, outright bribery, hordes of lobbyists, multimillion-dollar
propaganda campaigns, NAFTA, the WTO, the IMF and the World Bank. An
example of their reach can be found in the Water Investment Act moving
through Congress, a generally worthy bill to provide funds for local
cities to upgrade or expand their water systems. But industry lobbyists
have tucked two little bombs into it, which remain in the House version:
(1) a city cannot get federal financing unless it "has considered" privatizing
its water system; and (2) private water corporations could get public
subsidies for their water schemes. The Grassroots Rebellion hile politicians--from
Congress to city halls--have been bamboozled by privatization hucksters,
who promise to bring "market efficiency" to the distribution of scarce
water, ordinary folks have shown themselves to be way warier of surrendering
public control. They know instinctively that the corporations are simply
trying to grab a monopoly over a substance no one can live without,
then squeeze maximum profits from it by firing experienced city workers,
slashing wages, raising consumer rates, cutting service and ignoring
repairs. The great story here, untold by the establishment media, is
of courageous rebels who are daring to step in front of the Great Corporate
Water Rush. Meet two of these. Hiroshi Kanno, 64, works a small farm
in central Wisconsin. He stands only 5'6" tall, but--with his family
and neighbors--he became a giant killer, beginning two years ago when
the multibillion-dollar Perrier Group arrived in the towns of Newport
and New Haven. It informed startled locals that it had a wondrous plan
to begin continuous pumping of 500 gallons per minute of the area's
pure spring water into its assorted bottles (Perrier's labels include
Arrowhead, Calistoga, Deer Park, Oasis, Ozarka, Poland Spring and Utopia).
But Kanno asked, "Who needs this?" He and others began asking more pointed
questions, but got only evasive answers, so they got to organizing,
with "Perrier Go Away" as their rallying cry, and also launched referendums
in both Newport and New Haven. Perrier responded with hired lobbyists,
a PR offensive and cash--including $20,000 to the city of New Haven.
But money didn't buy love. New Haven voted 3 to 1 against the water
scheme, and Newport voted 4 to 1 against it. New Haven went further,
voting overwhelmingly to recall the town chairman, who'd accepted Perrier's
$20,000--then they gave back the money. "This is about the people versus
the powers that be," said the new town chairman. But Perrier wasn't
about to give up. It had the backing of then-Governor Tommy Thompson,
whose natural resources agency quickly obliged Perrier with pumping
permits. In response, Kanno's group, with the help of Ed Garvey, the
savvy and scrappy people's lawyer from Madison, sued the state to revoke
the permits. While Perrier retains local water leases, a state judge
has ruled that the state erred in granting the permits. The Big Sleazy
everal global corporations have been drooling over the possibility of
getting a billion-dollar contract to privatize New Orleans's water and
sewage systems, the largest such deal in US history. Outgoing Mayor
Marc Morial had stacked the water board that would award the contract,
and he thought he had the deal wired...but the people of New Orleans,
informed by three major experiences, had other thoughts. First, part
of the city's sewage treatment system has been privatized since 1992,
with US Filter (owned by Vivendi) now holding the contract. When it
was up for renewal five years later, at a time when another company,
now also owned by Vivendi, had the contract, company executives got
caught bribing a water board member. Second was the sewage incident.
Last year, raw sewage spread from a treatment plant onto surrounding
lands and into the Mississippi River for two hours, even though equipment
problems had been known to US Filter for weeks. Third, while Morial
talked of huge savings, an independent analysis found Hizzoner's numbers
to be Enronesque. Then, Josephine Elow got on the case. A 70-something
retired public health nurse, Elow is an activist with Seniors with Power
United for Rights--SPUR! She and the group went door to door, making
calls and eventually helping to put on the ballot a charter amendment
that said simply: no water privatization without voters' approval. This
people's amendment passed last March by a stunning vote of 9 to 1, changing
the balance of power--one corporate contender withdrew, citing "political
volatility," and the new mayor says he doesn't like the old mayor's
deal. A 9-to-1 margin is daunting to those who dared hope they still
might slip privatization past the voters. Wisconsin and New Orleans
are only two skirmishes in the long and hard struggle we face against
this antidemocratic power grab, but the stories confirm that the only
thing that'll stop it is people like Kanno, Elow...and you. To join
the fight, contact Public Citizen's water staff (202-546-4996 or cmep@citizen.org).
TOXIC CHEMICALS IN ENVIRONMENT
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with two words in the body of the message (not in the subject line):
Last week the NEW YORK TIMES took a slap at one of my favorite organizations,
the Science and Environmental Health Network or SEHN (http://www.sehn.org).
The TIMES accused SEHN of harboring beliefs far outside the mainstream
of science: "[SEHN] gives much more weight than do most industry scientists
and government regulators to theories that chemicals in the environment
are disrupting the human endocrine system and contributing to a wide
range of ailments." (NY TIMES Aug. 19, pg. C5.) As president of the
board of SEHN, I thought I should take this accusation seriously. It
is true that SEHN supports the view that industrial chemicals in the
environment can disrupt hormones and by this means are probably contributing
to a wide range of human ailments. Is this view not generally held by
the mainstream scientific community? SEHN's position has been stated
best by science director, Ted Schettler, a physician. Before he joined
SEHN, Schettler, along with several co-authors published GENERATIONS
AT RISK: REPRODUCTIVE HEALTH AND THE ENVIRONMENT (MIT Press, 1999) --
a 230-page review of medical and scientific data showing that some industrial
chemicals in the environment (such as lead, mercury, cadmium, arsenic,
manganese, chlorinated solvents, some pesticides, PCBs and dioxins)
can and probably do interfere with the hormone systems of humans (and
non-human animals), causing or exacerbating disease in some who are
exposed.[1] In 2000, Schettler and SEHN board member David Wallinga
(also a physician) and other co-authors published a shorter book titled,
IN HARM'S WAY: TOXIC THREATS TO CHILD DEVELOPMENT. That book concluded
that "Neurodevelopmental disabilities are widespread, and chemical exposures
are important and preventable contributors to these conditions."[2,
pg. 117; and see RACHEL'S #712.] Is this conclusion warranted by the
facts? It certainly seems so. Scientific studies of a single toxic element,
lead, spanning the last 100 years provide ample justification for such
a statement. (Notably, the hormone-disrupting characteristics of lead
and about 75 other environmental chemicals are described in three recent
technical books.[3]) Do "most industry scientists and government regulators"
disagree with Ted Schettler and SEHN? Neither we nor the NEW YORK TIMES
has any reliable information about what "most" scientists and regulators
think about hormone-disruptors. I suspect the TIMES simply manufactured
its conclusion out of thin air. (Unfortunately, it wouldn't be the first
time the TIMES had done such a thing to belittle health dangers from
industrial chemicals. See, for example, RACHEL'S #346 and #486.) Still,
the accusation against SEHN warrants a fresh look. I decided to investigate
the current scientific status of the idea that chemicals can interfere
with hormones. To do so, I chose one hefty scientific journal that often
carries articles about the effects of environmental chemicals on wildlife
and humans. Then I spent a grueling week reading every chemicals-and-health
study in the last 24 monthly issues. The journal I chose is ENVIRONMENTAL
HEALTH PERSPECTIVES (EHP), which is published by the federal government's
National Institute of Environmental Health Sciences, a division of the
National Institutes of Health. The editorial board of EHP is composed
mainly of academic scientists but it also includes representatives from
Dow Chemical Company, the Schering Plough pharmaceutical company, and
the Chemical Industry Institute of Toxicology (CIIT). You can think
of CIIT as the research arm of the American chemical industry. Of course
I didn't start off completely ignorant. I had been reporting on environmental
hormone disruptors since 1991 (see RACHEL'S #263). But I have to tell
you, I wasn't prepared for what I found. I'm going to summarize recent
studies of hormone-disrupters published in EHP, but first some background
on this problem: In 1991, about two dozen scientists from half a dozen
countries published a consensus document that became known as The Wingspread
Statement. (See RACHEL'S #263.) It said in part, "We are certain of
the following: "A large number of man-made chemicals that have been
released into the environment, as well as a few natural ones, have the
potential to disrupt the endocrine [hormone] system of animals, including
humans. Among these are the persistent, bioaccumulative, organohalogen
compounds that include some pesticides (fungicides, herbicides, and
insecticides) and industrial chemicals, other synthetic products, and
some metals. "Many wildlife populations are already affected by these
compounds. The impacts include thyroid dysfunction [impaired or abnormal
functioning] in birds and fish; decreased fertility in birds, fish,
shellfish, and mammals; decreased hatching success in birds, fish and
turtles; gross birth deformities in birds, fish and turtles; metabolic
abnormalities [impaired or abnormal use of energy, manufacture of tissue,
or handling of resulting wastes] in birds, fish, and mammals; behavioral
abnormalities in birds; demasculinization and feminization in male fish,
birds, and mammals; defeminization and masculinization of female fish
and birds; and compromised [impaired] immune systems in birds and mammals.
"The patterns of effects vary among species and among compounds. Four
general points can nonetheless be made: (1) the chemicals of concern
may have entirely different effects on the embryo, fetus, or perinatal
[meaning "near the time of birth," from the 28th week of pregnancy through
the first week of life, in humans] organism than on the adult; (2) the
effects are most often manifested in offspring, not in the exposed parent;
(3) the timing of exposure in the developing organism is crucial in
determining its character and future potential; and (4) although critical
exposure occurs during embryonic development [from conception through
the end of the second month of pregnancy], obvious manifestations [effects]
may not occur until maturity. "Laboratory studies corroborate the abnormal
sexual development observed in the field and provide biological mechanisms
to explain the observations in wildlife. "Humans have been affected
by compounds of this nature, too. The effects of DES (diethylstilbesterol),
a synthetic therapeutic agent, like many of the compounds mentioned
are estrogenic [meaning they act like estrogen, female sex hormone].
Daughters born to mothers who took DES now suffer increased rates of
clear cell adenocarcinoma [cancer], various genital tract abnormalities,
abnormal pregnancies, and some changes in immune responses. Both sons
and daughters exposed in utero [while in the uterus] experience congenital
anomalies of their reproductive system and reduced fertility. The effects
seen in in utero DES-exposed humans parallel those found in contaminated
wildlife and laboratory animals, suggesting that humans may be at risk
to those same environmental hazards as wildlife." The Wingspread Statement
continued on, but those were the key points. The main message of the
Wingspread Statement -- that industrial chemicals can interfere with
hormones and thus harm animals and humans -- wasn't totally new in 1991.
Researchers in 1950 had demonstrated that the pesticide DDT could dramatically
shrink the testicles of roosters, obviously interfering with their normal
testosterone (male sex hormone).[4] In the early 1970s, researchers
discovered to their horror that "occupational exposures to pesticides
could diminish or destroy the fertility of workers." [EHP Vol. 108,
No. 9 (September, 2000), pgs. 803-813.] In 1980, the term "environmental
estrogens" was invented to describe industrial chemicals found in the
environment that behaved like the female sex hormone, estrogen.[5] What
the 1991 Wingspread Statement did was shine a spotlight on an unrecognized
world-wide pattern of harm from endocrine-disrupting chemicals, mainly
in wildlife, but also plausibly in humans. The following year Theo Colborn,
who had convened the original Wingspread meeting, published a volume
of scientific evidence supporting the Wingspread conclusions.[6] As
time passed, these findings electrified the scientific community, persuading
thousands of researchers to look for similar effects in wildlife, laboratory
animals, and humans all over the world. In 1995 Theo Colborn, J.P Myers
and Dianne Dumanoski published OUR STOLEN FUTURE, a scientific treatise
on hormones written like a mystery story to reach a wide audience. OUR
STOLEN FUTURE awoke the environmental community and focused enormous
media attention on this emerging problem. The web site http://www.ourstolenfuture.org
is still the best single place to learn about the latest hormone-disruptor
studies. Because it was scientifically solid yet easily readable by
the general public, OUR STOLEN FUTURE drove the chemical industry into
a frenzy of denial and retribution. They hired PR attack dogs aiming
to destroy the reputations of Colborn, Myers and Dumanoski, and NY TIMES
science writer Gina Kolata began barking and snarling with the best
of them (see RACHEL'S #486). Now, 11 years after the Wingspread Statement,
are these ideas ridiculed, held in disrepute, or simply ignored by the
scientists who publish in EHP? Has the scientific community moved beyond
"endocrine disruptors" or is this problem still being taken seriously?
By way of answers to these questions, here are a few general statements
from EHP: "Endocrine-disrupting chemicals are among the most complex
environmental health threats known today. By mimicking natural hormones
such as estrogen and testosterone, these chemicals can interact with
the body's endocrine system and exert toxic effects that may lead to
reproductive and developmental abnormalities or cancer." [EHP Vol. 109,
No. 9 (September 2001), pg. A420.] "The developing organism is exquisitely
sensitive to alterations in hormone function. In the early embryonic
state, the gonads of human males and females are morphologically [physically]
identical. Sexual differentiation [turning a fetus into a boy or a girl]
begins under hormonal influence during the fifth and sixth weeks of
fetal development, and thus alteration of hormone function during this
highly sensitive period can have profound, often debilitating, consequences.
The balance of estrogens and androgens [male hormones] is critical for
normal development, growth, and functioning of the reproductive system.
Although it is especially important during development, this balance
is important throughout life for preservation of normal feminine or
masculine traits. "A number of environmental chemicals have actions
that mimic or alter the normal sex steroid hormones. The fetus is especially
vulnerable because this is the period of time when organs develop. If
the normal balance between estrogens and androgens is disrupted, the
result may be feminization of males, masculinization of females, birth
defects of the reproductive organs, reduced fertility, and alteration
of the expression of normal feminine or masculine personality traits,
probably including sexual preference."[7] To be continued. ==========
[1] Ted Schettler, Gina Solomon, Maria Valenti, and Annette Huddle,
GENERATIONS AT RISK: REPRODUCTIVE HEALTH AND THE ENVIRONMENT (Cambridge,
Mass.: MIT Press, 1999). ISBN 0-262-19413-9. [2] Ted Schettler, Jill
Stein, Fay Reich, Maria Valenti, and David Wallinga, IN HARM'S WAY:
TOXIC THREATS TO CHILD DEVELOPMENT (Cambridge, Mass.: Greater Boston
Physicians for Social Responsibility [GBPSR], May 2000). Available on
the web at http://www.igc.org/psr/ihwrept/ihwcomplete.pdf or as a paper
copy from GBPSR in Cambridge, Mass.; telephone 617-497-7440. [3] See,
for example, Lawrence H. Keith, editor, ENVIRONMENTAL ENDOCRINE DISRUPTORS:
A HANDBOOK OF PROPERTY DATA (New York: Wiley, 1997; ISBN 0471191264).
See also M. Metzler, editor, ENDOCRINE DISRUPTORS; THE HANDBOOK OF ENVIRONMENTAL
CHEMISTRY VOL. 3 (New York: Springer-Verlag, 2002; ISBN 3540422803);
and Louis Guillette, Jr. and D. Andrew Crain, ENVIROMENTAL ENDOCRINE
DISRUPTERS; AN EVOLUTIONARY PERSPECTIVE (New York: Taylor & Francis,
2000; ISBN 1560325712). [4] H. Burlington and V.F. Lindeman, "Effect
of DDT on testes and secondary sex characteristics of white leghorn
cockerels," PROCEEDINGS OF THE SOCIETY FOR EXPERIMENTAL BIOLOGY AND
MEDICINE Vol. 74 (1950), pgs. 48-51. [5] Sheldon Krimsky, "An Epistemological
Inquiry into the Endocrine Disruptor Thesis," ANNALS OF THE NEW YORK
ACADEMY OF SCIENCES Vol. 948 (Dec., 2001), pgs. 130-142. [6] Theo Colborn
and Coralie Clement, editors, CHEMICALLY-INDUCED ALTERATIONS IN SEXUAL
AND FUNCTIONAL DEVELOPMENT: THE WILDLIFE/HUMAN CONNECTION [Advances
in Modern Environmental Toxicology Vol. XXI] (Princeton, N.J.: Princeton
Scientific Publishing Co., 1992). [7] EHP Vol. 110 Supplement 1 (February,
2002), pgs. 27.
FIRST AMENDMENT RIGHTS TO CORPORATIONS
Advertise This! Corporations are gaining ground fast in their effort
to assume all of the U.S. constitutional protections afforded human
beings. Some of the last limitations on corporate free speech rights
may be about to fall, thanks to Supreme Court decisions that increasingly
equate commercial advertising with political speech, and a Food and
Drug Administration (FDA) that appears eager to accept Court-imposed
restrictions on its authority. To see what you can do to help block
this corporate empowerment, see: http://www.essentialaction.org/commercialspeech.
An 1886 Supreme Court decision established that corporations in the
United States are entitled to constitutional protections. Since then,
the Court has progressively extended Bill of Rights protections, including
First Amendment speech rights, and other constitutional guarantees to
corporations. In 1978, the Court established a constitutional right
to "commercial speech" -- speech intended to promote and advertise products
for sale, as opposed to political or expressive speech. Since 1978,
the courts have steadily expanded commercial speech rights, taking a
potentially dramatic step in a decision issued earlier this year. In
that decision, Thompson v. Western States Medical Center, the Supreme
Court interpreted its commercial speech test, developed in a case called
Central Hudson, to make it very difficult for the government to restrict
commercial speech. Western States Medical Center involved a provision
of a 1997 law that permits pharmacies to make compounded pharmaceuticals
-- drugs manufactured on the premises, to serve the specific needs of
particular patients. The 1997 law permits compounded drugs to be sold
-- even though they have not passed FDA safety and efficacy tests --
but on condition that they not be advertised. The basic idea is to seek
a balance: to permit manufacture for specifically prescribed needs,
but to prevent pharmacies from circumventing the FDA's safety rules
by advertising untested compounded drugs to the broad public. The Supreme
Court struck down this provision, holding that it violated the commercial
speech rights of the pharmacies. In conducting the Central Hudson test,
the Court agreed that there is a substantial governmental interest in
protecting public health and preserving the integrity of the FDA drug
approval process, and conceded the advertising restrictions might directly
advance these ends. But it held that the law failed to satisfy the final
prong of the Central Hudson test, "whether it is not more extensive
than necessary to serve that interest." Justice O'Connor, writing for
the majority, posited a series of alternatives to an ad ban, without
citing any evidence, or even providing compelling arguments, that these
alternatives would work as effectively as an ad ban. But they were enough
for the majority to conclude that the advertising restrictions were
more extensive than necessary. This holding seems to move the Central
Hudson test away from ascertaining whether there is a reasonable fit
between the government's commercial speech regulations and its legitimate
goals, and towards a much higher level of scrutiny. The Court is beginning
to break down the constitutional distinction between political and (nonmisleading)
commercial speech -- even though commercial speech protections essentially
apply uniquely to corporations, which do most commercial advertising.
The Supreme Court justifies this rising level of protection for commercial
speech on the grounds that the government cannot legitimately deny the
public truthful commercial information to prevent the public from making
bad decisions with the information. But why not? If the Court is going
to justify commercial speech protections based on the public's right
to know, as opposed to the speaker's right to speak, it makes sense
for the government to make determinations about whether the commercial
information actually will educate the public to advance public policy
goals. It is hardly a revelation that advertising contains promotional
elements that may drown out its educational benefits. The high level
of protection afforded to commercial speech by the courts poses a difficult
challenge for regulatory agencies that reasonably seek to restrict advertising,
including and especially the FDA, which has good public health reasons
to restrict advertising and promotional claims. For example, drug companies
now spend billions of dollars a year on Direct-to-Consumer (DTC) prescription
drug advertising, with more spent to advertise leading drug brands than
Pepsi or Budweiser. These ads encourage consumers to demand, and doctors
to prescribe, pharmaceuticals that people don't need. The ads fail to
convey the comparative benefits of the marketed drugs to alternatives.
They don't reveal price information. DTC ads should be prohibited. But
as long as the Supreme Court holds that there are constitutional speech
protections, they must be highly regulated. Now, the extent of FDA's
authority to regulate DTC ads is somewhat uncertain. Or consider tobacco
(not currently under the jurisdiction of the FDA, or any federal health
agency). There is an abundance of studies conclusively showing that
advertising increases smoking rates, especially among youth. Tobacco
ads and promotions should be banned. Commercial speech protections make
this impossible. The Court's new formulation may also make even more
modest restrictions on tobacco promotion very difficult. There is no
question that the Court has made things hard for the FDA, which must
maneuver to give itself the greatest possible latitude to restrict advertising
to protect public health. Unfortunately, the FDA seems quite happy to
forfeit the powers it needs to do its job. In May, the agency put out
a request for comments (with a comment period open until mid-September)
on issues involving First Amendment protections for commercial speech
and the scope of the agency's authority. It appears the agency is looking
for excuses to throw up its hands -- "Sure, we'd like to do our job,
but there's not much we can do. The Supreme Court says corporations
have a constitutional right to advertise, even if that will harm public
health." The outcome, however, is not a foregone conclusion. Twenty-five
years ago, there were no constitutional protections for commercial speech.
The tide can be turned back, beginning with a public demand that the
Food and Drug Administration -- the leading U.S. public health regulatory
agency -- assert the supremacy of protecting the public health over
a purported constitutional right for corporations to hawk their wares.
Russell Mokhiber is editor of the Washington, D.C.-based Corporate Crime
Reporter. Robert Weissman is editor of the Washington, D.C.-based Multinational
Monitor, http://www.multinationalmonitor.org, and co-director of Essential
Action. They are co-authors of Corporate Predators: The Hunt for MegaProfits
and the Attack on Democracy (Monroe, Maine: Common Courage Press, 1999;
http://www.corporatepredators.org). (c) Russell Mokhiber and Robert
Weissman This article is posted at: http://lists.essential.org/pipermail/corp-focus/2002/000126.html
_______________________________________________ Focus on the Corporation
is a weekly column written by Russell Mokhiber and Robert Weissman.
Please feel free to forward the column to friends or repost the column
on other lists. If you would like to post the column on a web site or
publish it in print format, we ask that you first contact us (russell@essential.org
or rob@essential.org). Focus on the Corporation is distributed to individuals
on the listserve corp-focus@lists.essential.org. Focus on the Corporation
columns are posted at . Postings
on corp-focus are limited to the columns. If you would like to comment
on the columns, send a message to russell@nationalpress.org or rob@essential.org.
JULY-AUGUST, 2002 NO. OF MULTINATIONAL MONITOR
I recommend this magazine to all interested in resisting abusive
corporate power, which has resulted from 50 years of Republican efforts
to free corporations from oversight and accountability. This "Corporate
Reform After Enron" issue contains six articles, "The Corporate
Crime Scorecard," three interviews, and several short pieces.
BUSH ADMINISTRATION FACILITATES CORPORATE CRIME
Business as Usual By PAUL KRUGMAN The mood among business lobbyists,
according to a jubilant official at the Heritage Foundation, is one
of "optimism, bordering on giddiness." They expect the elections on
Nov. 5 to put Republicans in control of all three branches of government,
and have their wish lists ready. "It's the domestic equivalent of planning
for postwar Iraq," says the official. The White House also apparently
expects Christmas in November. In fact, it is so confident that it has
already given business lobbyists the gift they want most: an end to
all this nonsense about corporate reform. Back in July George W. Bush
declared, "Corporate misdeeds will be found and will be punished," touting
a new law that "authorizes new funding for investigators and technology
at the Securities and Exchange Commission to uncover wrongdoing." But
that was then; don't you know there's a war on? The first big step in
undermining reform came when Harvey Pitt, chairman of the S.E.C., backtracked
on plans to appoint a strong and independent figure to head a new accounting
oversight board. But that was only a prelude. The S.E.C. has been underfunded
for years, and most observers - including Richard Breeden, who headed
the agency when Mr. Bush's father was president - thought that even
the budget Mr. Bush signed back in July was seriously inadequate. But
now the administration wants to cancel most of the "new funding" Mr.
Bush boasted about. Administration officials claim that the S.E.C. can
still do its job with a much smaller budget. But the S.E.C. is ludicrously
underfinanced: staff lawyers and accountants are paid half what they
could get in the private sector, usually find themselves heavily outnumbered
by the legal departments of the companies they investigate, and often
must do their own typing and copying. Officials say there are investigations
that they should pursue but can't for lack of resources. And the new
law expands the S.E.C.'s responsibilities. So what's going on? Here's
a parallel. Since 1995 Congress has systematically forced the Internal
Revenue Service to shrink its operations; the number of auditors has
fallen by 28 percent. Yet it's clear that giving the I.R.S. more money
would actually reduce the federal budget deficit; the agency estimates
that it loses at least $30 billion a year in uncollected taxes, mainly
because high-income taxpayers believe they can get away with tax evasion.
So starving the I.R.S. isn't about saving money, it's about protecting
affluent tax cheats. Similarly, top officials don't really believe that
the S.E.C. can do its job with less money; the whole point is to prevent
the agency from doing its job. In retrospect, it's hard to see why anyone
believed that our current leadership was serious about corporate reform.
To an extent unprecedented in recent history, this is a government of,
by and for corporate insiders. I'm not just talking about influence,
I'm talking about personal career experience. The Bush administration
contains more former C.E.O.'s than any previous administration, but
as James Surowiecki put it in The New Yorker, "Almost none of the C.E.O.'s
on the Bush team headed competitive, entrepreneurial businesses." Instead
they come out of a world of "crony capitalism, in which whom you know
is more important than what you do and how you do it." Why would they
turn their backs on that world? And don't forget the personal incentives.
Almost all of those ex-C.E.O.'s in the administration became wealthy
thanks to the connections they had acquired in Washington; the exception
is Mr. Bush himself, who became wealthy thanks to the connections his
father had acquired in Washington. This process continues. Senator Phil
Gramm, who pushed through legislation that exempted Enron's trading
practices from regulation while his wife sat on the company's board,
is retiring and taking a new job: he's going to UBS Warburg, the company
that bought Enron's trading operation. Somehow, crusaders against business
abuse don't get similar offers. The bottom line is that you shouldn't
worry about those TV images of men in suits doing the perp walk. That
was for public consumption; now that the public is focused on other
things, it's back to business - insider business - as usual. From: http://www.nytimes.com/2002/10/22/opinion/22KRUG.html?todaysheadlines
MONOPOLY CORPORATE TAKEOVER
How to Break the American Trance By Doris Haddock,
AlterNet http://www.alternet.org/story.html?StoryID=14506 November 8,
2002
The following is a speech given by 92-year-old Doris "Granny D" Haddock,
who walked across the U.S. in 1999-2000 for campaign finance reform.
She made this speech to Citizens for Participation in Political Action
in Boston, on Sept. 27, 2002.
I want to begin by congratulating you for all the work you do. I know
it is often frustrating work. You are blessed to be able to see ahead
to a world of cooperation and peace -- a world of justice and sustainable
economies and meaningful democracies. You wonder why others cannot or
will not see these things or reach out for them, and why they in fact
oppose the obvious good -- why they take the part of the oppressor,
the blindered war horse. I would like us to take a few moments to consider
why this work is so hard, and what we might do to move toward our common
dreams more rapidly and with greater joy. Some of you may be old enough
to remember the Reagan Administration. Mr. Reagan and those around him
believed in a very new kind of American hero. This new hero was a business
hero -- not the fellow who built up a family furniture store on Main
Street and supported the Little League and the Scouts; this new hero
was not the woman who worked late hours to create a successful travel
agency, nor was this new business hero anything like any of the hard-working
Americans who built-up our middle class, advanced our standard of living
and gave us the resources and leisure for the proper civic life of a
democracy, with its leagues and Rotaries and Lions and Elks and VFWs
and party conventions and all that glory. No, the Reagan business hero
was the corporate takeover artist. Any regulations that might get in
the way of these ruthless new capitalists were removed -- removed so
that reptiles of uncommon greed and brutality might rule the earth,
which they now nearly do. What soon happened was that ALL corporations
of medium size or larger had to look over their shoulders. How did a
corporation protect itself in this environment from a hostile takeover?
It had to close down any factories that were not earning obscene profits.
Never mind that a factory had served a town well for a century, or that
it provided a healthy and regular profit for its stockholders. If it
seemed to be underperfoming by the new hypergreed standards, or if it
could be closed in favor of opening a foreign plant that provided a
slightly higher rate of return, then, in this new atmosphere, the company
was derelict in its duty to its stockholders if it did not ruthlessly
act. Perfectly good and profitable factories were closed. Benefits to
employees everywhere were attacked, and staffs were downsized, outsourced,
computerized, downsized again, outsourced again to temp agencies that
paid no health care or retirement, and on and on until America became
a very different place. The gap between rich and poor is now wider than
at any time in our history. It is still a wealthy nation for many people,
but poverty is on the rise, and those with jobs find themselves so overworked
trying to make ends meet that there is little time for family or for
the joy of living. Indeed, there is very little joy left in American
life. Workers are not loyal to their companies, because companies treat
them like expendable slaves, with no dignity or assurance that hard
work will result in advancement or security. We are living in the harsh
world invented by a handful of corporate raiders whose values were completely
foreign to the fairness and moderation that had so long served as the
proper foundation of American success and the American dream of plenty
for all. They were not a new kind of person, for there have always been
among us a few reptilian hearts of uncommon greed. What was new was
the political permission they received for their rape and rampage, which
continues. And so a new world devolved as if from a virus. The new business
hero, a Horatio Alger on crack, did very well. The new model CEO derived
from that moment -- the ruthless mercenary who would come in to reorganize
a company and render it takeover-proof by rendering it inhumane. This
executive was worth millions per year, we were told. In this way, a
Darwinian system of corporate survival assured that the most carnivorous,
rather than the most responsible, would rise to lead our most powerful
commercial organizations. And if you need an explanation for Fox News
or Enron, this is the history you need to remember. These superwealthy
predators now, through their political patronage, control both political
parties. They control Congress and the White House. They control elements
within your state house. They are not particularly smart people, as
their current agent in the White House clearly demonstrates. Here is
how the takeover of corporations became the corporate takeover of American
democracy: To get along and move up in one of these right wing business
organizations, you have to be like the boss. The people working under
you will then want to be like you to get along themselves. In Fox News,
even reporters in local regions are told how to slant each story hard
to the right. There is no pretense of journalism within the organization.
And many people stuck in those jobs, who got into journalism with the
idea of doing legitimate journalism, are sick to their stomachs every
working day. In this way, the right-wing leanings of a few people have
distorted entire industries, including television news. Political leaders
are quickly infected in this trickle down reptilism -- trickling down
from the people who write the checks for political campaigns and who
control political news. And the reptilism trickles down further, to
the weaker minds listening to talk radio or silly enough to spend too
much time watching cable television news -- people who buy the lies,
who are simply suckered into forking over their own political best interests
to the con artists who attempt to pick their pockets at the same moment
they are pointing out others who, they say, are the real trouble makers.
About 25 percent of our people are susceptible to this kind of con,
and they then give us problems by standing against any reasonable reforms.
They have been spiritually twisted by the cheap poison of a hundred
Rush Limbaughs into the angry, unthinking agents of the superrich. On
my long walk across America, a man driving a garbage truck told me that
the biggest problem facing America today was the inheritance tax. I
didn't have to ask him if he had a radio in his truck. I remind you
of all this because it is important to know that the reason our reforms
are difficult is not because Americans are split into two camps, conservative
and liberal. It is not like that at all. There are lots of conservatives
and liberals in America, but we are not the two sides of the divide.
True conservatives in our country don't have many political leaders
to look to with respect. Among the last was Barry Goldwater. He believed
that the government had no business in our bedrooms. He believed that
a woman and her doctor didn't need the government's help in deciding
her important issues. He would have laughed and then, I think, become
very, very angry at Ashcroft's attacks on the Bill of Rights and his
citizen-against-citizen snitching system. Goldwater believed that the
only issue of importance regarding gays in the military was whether
or not they could shoot straight. What we are seeing now from the far
right is not conservatism at all. It is fascism: the imposition of a
national and worldwide police state to enforce a narrow world view that
enriches and empowers the few at the expense of the many, and that gives
no respect or honor to other cultures, ways of living, or opinions.
To call that conservatism is a crime against the memory of America's
great and true conservatives, who might think that government ought
to be less involved in life than we old liberals would concur with,
but who nevertheless stood for the core American values that today's
right-wing leaders undermine at every opportunity. We Americans are
not split into liberals and conservatives. In fact, if you are running
for office from the center, or from left of center, just do a better
job of demonstrating how far right-wing your opponent is, and you will
win more and more votes. You will win them from the vast number of people,
most especially urban women and professional men, who identify themselves
as Republicans for old time's sake, but who are very uncomfortable when
forced to look squarely at the far right positions of many candidates
running under the flag of the Grand Old Party. Given moderate alternatives,
they will vote for them. That was exactly the truth that Clinton understood
and exploited so brilliantly. He understood that Republicans are conservatives
but the Republican Party is not. If you want to reflect upon how well
he exploited this insight, remember that Hillary was a Republican when
he met her. If we Americans are split into two meaningful camps, it
is not conservative versus liberal. The two camps are these: the politically
awake and the hypnotized -- hypnotized by television and other mass
media, whose overpaid Svengalis dangle the swinging medallions of packaged
candidates and oft-told lies. It is all done to politically prolong
the open season on us -- open season indeed, as the billionaire takeover
artists bag their catch for the day. And in their bags are our freedoms,
our leisure, our health care futures, our old age security, our family
time, our village life, our family-owned businesses on Main Street,
the middle class itself, and our position of honor and peaceful leadership
in the world. Once we understand what we are up against, and where the
meaningful dividing lines truly run, our lives as reformers can be easier
because we shall know how to proceed. How to break the hypnosis is then
the question. It is easy. Pull any contractor out of his white pickup
truck, turn down the talk radio blaring from it, and ask him, "Government
good, or government bad?" His glazed eyes will widen. "Government bad!"
he will say. Ok, good. You found one to play with. Now, ask him what
the town might do to make it safer for kids to get to and from school,
and around town when they're not in school, without getting killed by
traffic or getting in trouble. He will have a million ideas. Good ideas.
He has no clue that he is being government -- if government is what
happens when we get together to solve our common problems and to make
life better for our communities. You have broken his trance. When a
proposition is on the ballot, people talk about the mechanics of the
idea, and the hypnosis is largely circumvented. You see quite progressive
ballot propositions passing in otherwise quite unprogressive states.
Why? Because people are problem-solvers at heart, and they enjoy it.
They want to participate and be helpful and accepted as valuable players.
It takes a lot of hypnosis to overcome that instinct, and a lot of hypnosis
is what we have had. But we can get around it. Government agencies,
of course, have been the communitarian's worst enemies. Anything that
smacks of bureaucratic rudeness or pushiness or counterproductive stubbornness
does nothing but damage the idea that government is us -- we the people
acting together to solve our problems as fellow citizens. That brand
of government really needs to be stamped out whenever it shows its pinched,
gray face. That is what can be done and must be done to prepare the
ground for what must come next, which is a new engagement of citizens
with the issues of interest to them in their communities. We should
begin in our high schools. During the years from 13 to 19, lifelong
civic values are formed. We should start with our younger people. As
community leaders, we should work with the popular history and civics
teachers in our high schools to bring the issues of the day and the
issues of the town into the classroom -- not to propagandize but to
openly invite students to learn, research, and offer advice to the community
on a wide range of issues. This is where the hypnosis falls apart. This
is where democracy finds its feet again. This summer I asked America's
independent community radio stations to get involved with those same
teachers in our high schools, to make students into community reporters
and commentators. I reminded these indy news stations that they have
the technology and the dramatic missions young people crave. I said
young people will never become robots if they are enlisted in the cause
of truth at an early age. What we do in schools, we must also do in
colleges and then in the general community. But if we only have the
means to focus on the high schools, that is enough. These young people
will be voting in only a few years. If we support their increased civic
engagement as they move through college and into the community, we will
have raised an army of citizens immunized against corporate hypnosis.
Our victories for needed reforms will come naturally. With an engaged
and informed citizenry, who knows what good we might do, and what great
civilization we might yet again move toward? True conservatives and
liberals unite! Bring your issues and your opinions to our young people,
and create a new expectation that they will get involved, get informed,
and form a view of themselves as problem-solving citizens of a democracy.
Our differences from the left or right are nothing compared to the differences
between the politically awake and the hypnotized drones of the new colonialism
that now stalks and shreds our civilization. I urge you to think young,
to link with moderates on the other side of the fence, and to approach
the schools and teachers who can help you connect your young, rising
citizens to the issues that will shape their lives. If you believe that
human beings, in addition to all their other instincts, want to help
create and live in a happy, creative and cooperative world, then you
must believe that people are to be trusted in their politics so long
as they are encouraged to study everyone's experience and study the
competing points of view -- and so long as they are raised with enough
love and security to be capable of empathy. We need not force a liberal
agenda on our society, any more than we need force our political opinions
on our children. We can enjoy life instead of banging our heads against
the old walls. If we encourage an awake thoughtfulness, democracy and
justice will have all the victories our hearts can handle. To read more
of Doris Haddock's writings, visit GrannyD.com. Doris Haddock --------------------------------------------------------------------------------
Born Doris Rollins: Jan. 24, 1910 in Laconia, New Hampshire USA Widow,
two grown children. Thirteen great grandchildren (soon 15). Attended
Emerson College in Boston for 3 years. Left upon marriage to James Haddock,
an Amherst graduate. Emerson awarded her an honorary degree in 2000.
With her husband, Jim, she helped stop the planned atmospheric testing
of hydrogen bombs in Alaska in 1960, saving a fishing village at Point
Hope. After the defeat of Senator McCain and Senator Feingold's first
attempt to remove unregulated "soft" money from campaigns in 1995, she
became interested in campaign reform and led a petition movement. In
1998 she decided to walk across the U.S. to demonstrate her concern
for the issue of campaign reform. She walked around her hometown of
Dublin, New Hampshire for most of 1998 to get in shape for the walk.
On Jan. 1, 1999, she began her walk in Pasadena, California. She walked
10 miles per day for 14 months, arriving in Washington, D.C. on Feb.
29, 2000. She was hospitalized once, in Arizona, with dehydration and
pneumonia. She walked 3,200 miles. Her route: Pasadena to Twentynine
Palms CA, Parker AZ, Wickenburg, Phoenix, Tucson, Tombstone, Lordsburg
NM, Las Cruces, El Paso TX, Midland, Dallas, Texarkana AK, Little Rock,
Memphis TN, Louisville KY, Cincinnati OH, Parkersburg WV, Morgantown,
Cumberland MD, Washington, D.C. Her hardest miles were climbing the
Appalachian Range during blizzard conditions. She made speeches along
her walk, and made an effort to draw reform groups together. When she
arrived in Washington, she was met by 2,200 people, representing a wide
variety of reform groups. Several dozen Members of Congress walked the
final miles with her. Pro-reform Capitol Hill staffers and elected officials
credit her with demonstrating that Americans care about campaign finance
reform. She connected the issue with patriotic values in a way that
provided wider popular support for reform. She was instrumental in moving
the issue forward. When presidential candidate Al Gore adopted a campaign
finance reform plank, his speech credited John McCain, Bill Bradley,
and Doris Haddock. During the 2001 McCain-Feingold debate, she walked
continuously around the Capitol building for seven days. During the
final three days of debate, she walked 24 hours a day, stopping only
for catnaps and food. This was done in subfreezing winds and rain. She
met with 35 senators during this vigil, representing to them the feelings
of the people she met along the road. She is five-feet tall. She wore
out four sets of shoes on her long walk. When snows between Cumberland,
Maryland and Washington threatened to delay her arrival in February
of 2000, she cross-country skied 100 miles along the old C&O Canal tow
path. She has emphysema and arthritis, both of which improved during
the walk.
HHS WEAKENS REGULATION OF CORPORATIONS
Molly Ivins, what a gal... >
AUSTIN -- Under the radar. Wheee, it is coming down > fast and hard
out here. > > The Wall Street Journal devoted some coverage to the >
interesting case of Janet Rehnquist, inspector general > at the Department
of Health and Human Services. > Rehnquist, daughter of U.S. Supreme
Court Chief Justice > William Rehnquist, is in hot water for politicizing
her > non-partisan office and forcing out longtime career > civil servants:
This is the kind of thing that draws > attention in Washington, D.C.,
but buried in the story, > we find some interesting nuggets concerning
Inspector > Rehnquist's efforts to create a kinder, gentler IG > department.
> > "The HHS office is responsible for safeguarding $450 > billion-plus
in annual spending, including Medicare and > Medicaid, giving it a big
role in policing health-care > fraud. It annually makes cost-saving
recommendations > totaling billions of dollars, participates in hundreds
> of criminal prosecutions and bars thousands of entities > from government
work," reports the Journal. > > The perfect job for some Republican
who hates waste, > fraud and abuse, right? Whoops, nope. According to
the > Journal, "The new inspector general quickly put her > stamp on
the office, easing anti-fraud measures and > instead emphasizing voluntary
compliance. She scaled > back the use of 'corporate integrity agreements,'
in > which health-care companies found to have defrauded the > government
acquiesce in strict reporting conditions, > saying she was 'concerned
about their financial impact' > on providers." > > June Gibbs Brown,
Rehnquist's predecessor in the > office, says she has "weakened the
system. It's really > giving in to industry." > > Hey, with an alert
guardian watchdog like that at work, > how come the FBI had to raid
Tenet Healthcare Corp., > now accused of pumping up its Medicare revenues
by > hundreds of millions of dollars? > > Perhaps it has something to
do with Tom Scully, the HHS > official who oversees Medicare and Medicaid,
and who > thinks Rehnquist is doing a dandy job. Scully is the > former
head of a hospital industry group. > > Another raccoon in the henhouse.
The new chairman of > the Senate Environment and Public Works Committee
is > Sen. James Inhofe (R.Okla.), a man with a zero rating > from environmental
groups. Inhofe advocates letting > industry police itself and less government
oversight. > > We have already tried letting industry police itself
in > Texas; it does not work. According to his own > environmental commission,
then-Gov. George W. Bush's > voluntary legislation for the 850 plants
with more than > 900,000 tons of pollution "grandfathered" out of the
> Texas Clean Air standards resulted in a grand total of > 134 tons
of pollution reductions. The voluntary law was > such a failure that
immediately after W moved to > Washington, the Texas legislature replaced
W's program > with a mandatory one. > > If the Republicans really think
it is such a good idea > not to have government regulation, let's try
an > experiment. Let's just take down all the traffic signs > and signals
and see what happens. Think voluntary > compliance will make us safer?
And there's not even a > monetary incentive to drive unsafely. > > The
drug industry is salivating. No special interest > campaigned harder
for Republicans than the > pharmaceutical firms, using phony front groups
like > "United Seniors." Wait'll you see the payoff for them: > no price
controls, no patent reform and new laws to > keep drugs that are sold
at cut rates abroad from being > resold in the United States at lower
prices. The Center > for Responsive Politics reports that drug manufacturers
> are the top spending lobby. The industry has 400 > lobbyists in Congress
(there are only 535 members) and > spent nearly $97 million in 2000.
As of June 30, the > industry ranked ninth among more than 80 industry
> groups in direct contributions to congressional > candidates and political
parties: 73 percent of its > $18.1 million spent to that date went to
Republicans. > > The Federal Communications Commission is contemplating
> new horrors. The FCC, headed by Secretary of State > Colin Powell's
son (didn't we used to think that > hereditary power was a bad idea?),
is fixing to repeal > the last of the restrictions on how many media
outlets > can be owned by one company. We already know from > repeated
experience that this decreases competition in > the field. The numbers
are irrefutable, the facts are > all there, so that's why Chairman Michael
Powell is > repealing the restrictions, "to increase competition." >
Gosh, maybe it will work this time: Why let experience > and evidence
bother us? > > The administration is expected to revive its so-called
> plan to reduce the risk of forest fires--a giveaway to > the timber
industry. > > The litany of horrors, both completed and contemplated,
> could go on for days, but that is no excuse for giving > up. In fact,
it's much easier to stop bad legislation > than it is to pass good legislation.
Playing defense in > politics is much easier than playing offense. Smart
> Democrats in Congress and citizens raising cain can > derail most
of this. Just stay alert and involved, > team. There is fun yet to be
had. Indeed, given the > number of blue-bellied nitwits who are about
to become > Senate committee chairs, we can look forward to a high >
degree of unintentional comedy.
CARTELS, WWII, AND POWER TODAY
A link to another article, "Zionism: Compulsory Suicide for Jews --
Are Americans Next?" in the pages of Henry Makow appeared on the GlobalGreens
list. http://www.savethemales.ca/130402.html
Be Afraid: The New World Order's Fascist Pedigree by Henry Makow Ph.D.
April 13, 2002 This 57-cent stamp shows an eagle, which according to
Al Martin is an exact copy of the symbol of the Nazi Waffen-SS. The
USPS introduced it in February 2001 as the innocuous sounding "art deco"
eagle, but in light of September 11, its symbolism is ominous. Martin
says this Nazi design will also be used for the triangular arm badges
and hats given to participants in the new Neighborhood Watch program.
A commercial with Ed McMahon, the new Department of Justice spokesman,
suggests that you cooperate with the Neighborhood Watch Association.
You will be told how to spot "suspicious" characters or even people
you know well, who are suddenly acting "out of character." Similarly,
John Ashcroft christened another homeland security force the "Freedom
Corps", evoking the "Freicorps," the German army's "irregulars" that
cleared the way for Hitler by murdering social democrats and communists.
These allusions are sinister because the Third Reich was an early attempt
at a "New World Order," and the Anglo American business elite was involved
with that up to its ears. Are these fascist allusions coincidental?
Or, is the elite coming out of the closet? Economist Robert Brady defined
the Nazi state as "a dictatorship of monopoly capitalism. Its 'fascism'
is that of business enterprise organized on a monopoly basis, and in
full command of all the military, police, legal and propaganda power
of the state." (Richard Sasuly, "I.G. Farben," 1947, p. 128) Nazi Germany
was a capitalist paradise. There was a 60-hour workweek, low wages and
no unions. Nazi expansionism represented the global ambitions of German
cartels that started preparing for war long before they financed Hitler.
As countries fell under the Nazi jackboot, they absorbed former competitors
at fire sale prices. "For German big business, World War II was a chance
to plunder on a scale without precedent in history," writes Sasuly (p.114).
The key to understanding the elite, and the direction of world events,
is to understand the psychology of the cartel. Cartels by definition
are a conspiracy. Their purpose is to defraud the public by keeping
prices high. They do this by controlling competition, markets, raw materials
and new technology. They are by definition meglo maniacal, anti-national,
and anti social. One of the earliest cartels was J. D. Rockefeller's
Standard Oil, which eliminated the competition by secretly fixing transportation
costs with the railroads. While he professed Christianity, Rockefeller
is famous for saying the only sin is competition. The largest German
cartel was the chemical, film and pharmaceutical giant I.G. Farben.
Farben produced 85% of Germany's explosives in World War Two. In 1926,
Farben and Standard Oil entered into a cartel agreement in which Farben
stayed out of synthetic oil in return for Standard representing Farben
in the US. The upshot of this agreement was that Standard Oil supplied
the Nazis with petroleum in spite of shortages in the US. It supplied
a rare lead additive without which the Luftwaffe could not fly. It suppressed
the production of synthetic rubber in the US, which almost cost the
Allies the war. In turn, Rockefeller got a cut of Farben's other business,
which included the many factories that employed slave labor from concentration
camps like Auschwitz. (Farben- Rockefeller paid the SS for this labor
at bargain rates.) Profits also derived from the poison gas that killed
the laborers after their usefulness was expended. This is the real reason
the rail lines to Auschwitz were not bombed. Allied bombers hit within
14 miles of Auschwitz but the factories and death camp were off limits.
In fact, German industry moved there for this reason. After the war,
the CIA established its German head quarters in the undamaged Farben
skyscraper in Frankfurt. The holocaust was very good business. Throughout
the 1930's Wall Street investment banks participated in "aryanization"
which meant getting Jewish owned breweries, banks, factories, department
stores etc. for 30% of their true value. The gold from the teeth of
holocaust victims ended up in their vaults. It is not an exaggeration
to say that the Nazi war effort was financed by the Bank of England
(which, for example, transferred the Czech gold reserves to the Nazis),
Wall Street (Prescott Bush, W's grandfather was one of the leading Nazi
financiers) and Jewish plunder. It was finessed by lawyer John Foster
Dulles, a member of the Council on Foreign Relations, who later became
US Secretary of State. After the war, Dillon Read banker General William
Draper was put in charge of dismantling German industry and distributing
it among the allies. Needless to say, this did not happen. His Wall
Street cohorts owned too much of it. Nazis businessmen remained in positions
of power, war criminals were transported to South America, or went to
work for the CIA. In contrast, during the war, the allies deliberately
prevented Jews from escaping from Europe. If someone sets a house on
fire, and someone else blocks the exits, don't they share equal blame?
On the first day of World War Two, His Majesty's ship "Lorna" fired
on the limping overcrowded "Tiger Hill" as she approached Palestine
with 1417 Jewish refugees. The first people killed by the British in
WWII were not Germans but Jewish escapees from Germany. Other refugee
ships (e.g. the "St. Louis") were sent back to Germany by the US or
blown up with all souls on board by British MI-6 (the "Struma"). For
the whole story, read "The Holocaust Conspiracy" (1989) by William R.
Perl, a Lt. Colonel with the US Army Intelligence Service. The list
of US corporations that had the equivalent of $8 billion invested in
Nazi Germany include Standard Oil, General Motors, IBM, Ford, the Chase
and National City Banks, ITT and many others. As a result, the men of
"We Were Soldiers" didn't know that ITT built the airplanes that dropped
bombs on them. They didn't know that Ford and General Motors built the
Nazi's trucks and tanks. They didn't know that ball bearings crucial
to the Nazi war effort were manufactured in Philadelphia, yet were in
short supply in the USA. This was all done with the knowledge and permission
of the US government. For details, I recommend Charles Higham's "Trading
with the Enemy"(1983). Christopher Simpson's "The Splendid Blond Beast"(1993)
and "Blowback" (1988) are also useful. This information is shocking
if we assume that cartels owe an allegiance to their native country.
This is not so. They live in a financial virtual reality, a spiritual
limbo divorced from common sympathy with their fellow man. Their native
countries are important only insofar as they provide patriots to die
for the advancement of their financial interests. If the elite backed
the Nazis, why didn't the Nazis win? The elite also backed the Allies.
It doesn't matter which version of NW0 the elite gets. The real money
is in war and genocide itself. In addition, war degrades and demoralizes
humanity so it will accept serfdom. In conclusion, the Third Reich was
an early attempt at the New World Order. The purpose of this kind of
"globalization" is to institutionalize the political power of the cartels.
This is the hidden agenda behind the current "war on terror," hence
the fascist symbols and measures.Most of our nation's leaders are hod
carriers for the cartels, particularly oil. They are careerists who
serve a class of people who have spiritually seceded from the human
race. This class holds us in bondage while it amasses wealth that affords
it neither peace nor joy. I leave you with a famous quotation by US
President Theodore Roosevelt.
To destroy this invisible government, to befoul the unholy alliance
between corrupt business and corrupt politics is the first task of the
statesmanship of today." Henry Makow, is the inventor of the board game
Scruples, and the author of A Long Way to go for a Date. He received
his Ph.D. in English Literature from the University of Toronto. He welcomes
your feedback and ideas at henrym@mts.net.
People Profit From Trade
by Paul Street; March 10, 2003
George W. Bush: "Trade is Good"
As the task of resisting the George Orwell Bush administration's "imminent"
attack on Iraq absorbs the lion's share of global peace and justice
energies, it becomes easy to forget the contributions and continuing
relevance of the "anti-globalization" (really global justice) movement.
The issues raised by that movement, which preceded and is now feeding
into current peace activism, have hardly disappeared. They remain remarkably
germane and inseparably linked to the immediate question at hand - US
imperialism.
How interesting, then to see the imperialist-in-chief refer to the
global justice movement during last week's rare prime-time presidential
press conference, meant to "prepare the American people" for "war" (massacre).
The reference came by way of his evasion of a reporter's query as to
"why...so many people around the world take a different view of the
threat that Saddam Hussein poses than you and your allies." After the
by-now standard White House line that Americans and Europeans are fortunate
to possess the freedom to "express their opinion...in stark contrast
to Iraq" - as if our free speech and assembly birthrights were more
seriously threatened by Saddam Hussein than John Ashcroft - Bush tried
to put the recent historic and massive global demonstrations against
his militarism into proper irrelevant place by likening them to supposedly
past and wrongheaded protests against "trade."
"I've seen all kinds of protests since I've been the President," Bush
noted. "I remember the protests against trade. A lot of people didn't
feel like free trade was good for the world. I completely disagree.
I think free trade is good for both wealthy and impoverished nations."
And just as the many millions who marched against US Empire last February
will not deter him from bombing Baghdad, those earlier demonstrations
"didn't change my opinion about trade."
"Poor People Profit From Trade"
Bush's comments give a simpleton's rendition of the standard American
corporate-Orwellian line on globalization. I know no better statement
of this line than the Chicago Tribune's editorial response to an already
forgotten episode last fall, when maybe two thousand global justice
activists marched in downtown Chicago to protest the Boeing-sponsored
meetings of the Trans Atlantic Business Dialogue (TABD). The marchers
were actually out-numbered by a remarkable assemblage of heavily equipped
riot police, deployed by a corporation-friendly Mayor determined to
reassure his new patron Boeing that "this is not Seattle" - the city
that Boeing's company headquarters fled in the wake of numerous bad
labor practices allegation and with the horrifying memories of November
1999, when 50,000 protestors disrupted the World Trade Organization
(WTO) meetings in Seattle. The TABD brings together leading European
and North American corporations and high-level government officials
to help set the WTO's "free trade" agenda.
Two mornings after the march, the Tribune's editorial board published
a condescending lecture-as-editorial bearing the title "People Profit
From Trade." The Tribune accused the "reactionary" protesters of romanticizing
pre-modern "peasant" lifestyles and counseled readers on the progressive
nature of global capitalism - summarized by the words "trade," "free
trade" and "globalism." "Wherever trade is on the agenda these days,"
the Tribune claimed, "the protestors want to make sure they're there
to get [one] message across: People over profits. They view free trade
with suspicion because businesses profit from trade." "Pssst," the Tribune
wrote, "so do people. People profit from trade. Poor people profit from
trade." Since poor people in developing nations benefit when their societies
engage in global "free trade," globalization is good for the poor.
In support of this thesis, the Tribune cited "rising living standards
in countries such as China, Mexico, India and Malaysia, which have focused
on opening their economies to trade. In China alone," the Tribune claimed,
"more than 200 million people have been lifted out of poverty in the
last two decades, a time frame that coincides exactly with China's economic
liberalization, its decision to hold a coming-out party to the rest
of the world." The paper also cited the "economic stagnation" in "vast
swaths of Africa and the Middle East," where "governments still try
to maintain tight control over their closed economies."
A subsequent Tribune editorial trumpeted the "unparalleled economic
and political success" of Chile, where "free market reforms" were introduced
by the military dictatorship of Gen. Augusto Pinochet. Pinochet ran
what the editorial board called a "schizophrenic" regime - good Pinochet
(University of Chicago "free market" economics practiced in "the morning")
versus bad Pinochet (killing leftists and trade unionists "in the afternoon")
- after he overthrew the democratically elected government of Salvador
Allende in a US-supported coup in 1973.
Suppressing Core Issues and Eternalizing the Existing Regime
Contrary to President Bush last Thursday and the Chicago Tribune last
November, the global justice ("Seattle") movement did not and does not
protest "trade" or "globalism" as such. Its cores issues focus on really
existing and historically specific contemporary globalization - involving
a range of social relations including but not restricted to "trade"
- under the authoritarian command of capital. It opposes not globalization
per se but a historically specific and hardly "free market" form of
globalization that:
- Generates waste and destroys natural habitat at a rate that exceeds
the earth's capacity to regenerate and heal itself.
- Pillages and commandeers that which formerly belonged to the human
and ecological "commons" for private and usually corporate profit.
- Turns everything - water, land, air, animals, vegetation, health
care, science, knowledge, academia, culture, public space, human labor
power, love, law and order, crime, politics - into a commodity and/or
private investment opportunity.
- Soaks every last crevice of human society in what Karl Marx called
"the icy waters of egotistical calculation" - the competitive ethos
and possessive individualism of marketplace capitalism.
- Contributes to the creation of a world wherein the richest 20 percent
of the world's people receive at least 150 times more income than
the poorest 20 percent.
- Increases inequality both within and between states, "concentrating,"
in the words of the United Nation's 1999 Human Development Report,
"power and wealth in a small and privileged group of people, nations
and corporations and marginalizing the others."
- Kicks away the ladder of development from peripheral nations in
the world system, preventing them from using the same policy methods
that produced "successful" internationally competitive development
in core states and "late-industrializing" semi-peripheral states.
These policies include import restrictions, industrial policy, state-owned
industries and extensive controls on foreign capital and exchange
rates.
- Pits unfairly over-indebted "developing" nations against each other
in an orgy of export competition while denying then (in the name of
"free markets") the right to protect their own domestic economies
from the heavily subsidized exports of more "advanced" nations and
the incursions of heavily state-subsidized multinational corporations.
- Requires poor nations to sacrifice their own food security and ecological
balance and divert scarce funds away from education, health care,
social services and environmental protection and into the hands of
wealthy bondholders and corporations as the price of admission to
the world economy.
- Drains tens of billions of dollars out of developing nations through
the intellectual-property protectionism of the richest states - the
costly, inefficient and often life-threatening patent monopolies enjoyed
by corporations based chiefly in Europe and North America.
- Deregulates global currency and capital flows, leaving nations and
governments hostage to rapidly shifting market sentiments and creating
financial crises that cause suffering for millions.
- Saturates the world with a flood of weapons, adding fuel to fires
of violence that are fed by the destabilizing consequences of corporate
and financial globalization and that provide self-fulfilling pretext
for massive state subsidy of high-tech military corporations in the
West.
- Favors authoritarian states over democracies since wages tend be
lower and environmental laws and social protections weaker in the
former than in the latter, giving businesses in dictatorships an advantage
in exploiting human and natural resources and selling exports abroad.
- Generates warfare while deepening and relying on the unilateral
power of an unchallenged rogue militarist empire - the United States
- Reflects and reinforces massive socioeconomic and related policymaking,
racial and other inequalities and escalating state repression at home,
in the United States - the industrialized world's most unequal nation
and the planet's number one incarceration state.
The falsely labeled "anti-globalization" protesters advocated not the
end of "globalism" but rather its transformation into a movement for
democracy, social justice, ecologically sustainable development and
equality within and between states. Rather than deal with this complexity,
Bush, the Tribune's editorial board and the American ruling-class understandably
prefer to employ a standard authoritarian ideological device. Reflecting
the privileged "elite's" desire to portray its dominant position as
an eternal fact of life (no more deserving of opposition than the positioning
of the planets), this device maintains that radical critics of existing
hierarchical social structures are actually opposed to social structures
as such. Following such slipshod ruling-class "reasoning," one might
absurdly argue that criticism of corporate media ownership is really
criticism of media per se or that opposition to the manufacture of murderous
military planes and helicopters by Chicago's TABD-sponsor Boeing is
actually opposition to aviation as such.
"The System Isn't Working At the Level of People"
In pronouncing it a simple uncontested fact that modern globalization
is reducing poverty in "developing nations," Bush, the Tribune's editorial
board and their many plutocratic allies brazenly ignore a significant
body of research demonstrating precisely the opposite. This research
shows that the particular de-regulatory or neo-liberal "free-trade/free-capital"
global trade and investment system enforced by the West and especially
the United States over the last three decades has actually slowed growth
and increased the vulnerability of poor countries. "In 1980," economists
Christian Weller and Adam Hersh note, "the world's poorest 10 percent,
or 400 million people, lived on the equivalent of 79 cents a day or
less. The same number of had 79 cents per day in 1990 and 78 cents in
1999. The income of the world's poorest did not even keep up with inflation."
Thanks to numbers like these, a small portion of what could be cited,
even World Bank president James Wolfensohn had to acknowledge three
years ago that the global "system isn't working" at what he called "the
level of people" - a rather significant level, one hopes.
Interestingly enough, corporate globalization enthusiasts could get
a clue on the consequences of really existing globalization by reading
senior Chicago Tribune correspondent R.C. Longworth. Longworth welcomed
the new millenium by noting that the world's "surging economy enriches
a few" but "bypasses the rest." In Longworth's view, "the 21st century,
like the 20th, began as a belle époque for those lucky enough to enjoy
it." Those "lucky" people were a distinct minority for whom the new
global era was "a golden age of peace, great wealth, booming markets.
Easy travel. Instant communications, fabulous comfort and, with it,
an innocence and confidence that this good fortune is not only deserved
but permanent." Life is "very different," Longworth noted, for the world's
"majority [who]...live in shantytowns on the outskirts of the global
village." He described the dire situation faced by the "rest of humanity"
beneath the opulent minority represented in the halls of the TABD, the
WTO, and the International Monetary Fund, and the White House - the
"millions of unemployed nomads in China, street people in Calcutta,
European workers without jobs, the 28 percent of Americans whose jobs
pay poverty-level wages, semi-educated young men in Morocco begging
in four languages, the hopeless poor of Africa, child laborers in Bangladesh,
the pensioners of Poland, the Russians wondering what happened to their
lives."
Confusing Cause and Effect
At the same time, the nations held up by the World Bank, the Chicago
Tribune, The Wall Street Journal and the rest as shining examples of
unregulated free-trade/free-capital globalization's positive impact
(China and India) actually "undermine the case for a connection between
greater de-regulation and falling poverty." Both nations, Weller and
Hersh note, "have sheltered their currencies from global speculative
pressures (a serious sin, according to the IMF). Both have been highly
protectionist (India has been a leader of the bloc of developing nations
resisting WTL pressure for laissez-faire openness). And both have relied
heavily on state-led development and have opened to foreign capital
only with negotiated conditions. By letting in foreign capital [only]
in a limited and negotiated way, India and China have benefited from
investment without totally sacrificing economic sovereignty."
As Mark Weisbrot notes, "the World Bank's favorite globalizers" - China,
India and Vietnam - do not fit the neo-liberal prescription. "China
and India have two of the most protected domestic markets in the world.
China does not even have a convertible currency, and India retains strict
capital controls. So does Vietnam, where the majority of investment
in recent years has been undertaken by the state." The Tribune's other
"free-trade" poster child (Chile) owes much of its development "success"
to its insistence on closely regulating foreign investment flows - another
anomaly for the neo-liberal wisdom.
Corporate neo-liberals confuse correlation with causation when they
claim to prove the benefits of "free-trade" globalization by showing
that foreign trade makes up a significantly larger share of national
Gross Domestic Product in relatively "successful" developing nations.
What this argument misses, notes Harvard economist Dani Rodrik, is that
foreign trade's share of a nation's economy tends to rise with economic
development. All neo-liberals really illustrate with their correlation
is that faster-developing societies tend to increase the proportion
of their economies devoted to trade. Rising trade-share is a consequence
of development, Weisbrot shows, not a policy path producing development
Missing the Meaningful Comparison and Deleting Democracy, Justice,
Ecology Concerns
By framing the globalization debate around the question of how the
poorest people are doing and misrepresenting the central issue as a
conflict between modern global-economic relations ("trade") and reactionary
non-engagement in such relations ("peasant" autarky), privileged "trade"
advocates avoid the fundamental issues at the heart of the global justice
movement. They eliminate in advance the possibility that anyone might
be advocating a more democratic and egalitarian model of modern globalization.
That possibility, however, is precisely what the movement is about.
Beyond complex empirical arguments over whether really existing globalization
is making the poor marginally better or worse off, "the real issue"
for social justice activists is what Nobel-prize-winning economist Amartya
Sen calls "the distribution of globalization's benefits." Even if the
poor could be shown to be getting "just a little richer" under the neo-liberal
regime, Sen reminds us, "this would not necessarily imply that the poor
were getting a fair share of the potentially vast benefits of global
economic interrelations." The "principal challenge" posed by modern
globalism, he argues, "relates to inequality - international and well
as intranational. The troubling inequalities include disparities in
affluence" but also "gross asymmetries in political, social and economic
opportunities and power."
The meaningful comparison, Sen argues, is not between what the worst
off get under the existing hierarchical global system and what they
would get with no global system at all. It is between the distributional
outcomes of the currently existing hierarchical system and the potential
outcomes of a more democratic and egalitarian world system. Many different
global arrangements - when compared with the absence of any world system
- could certainly be shown to be at least beneficial to poor people
as well as rich. The deeper question is how fairly benefits associated
with these different arrangements are distributed.
At the same time, the global justice movement is distinctly green and
democratic. Rejecting the more equal division of a poisoned pie, it
is not interested in closing global socioeconomic gaps while deepening
humanity's self-defeating and capital-led assault on world ecosystems.
The movement also rejects authoritarian power - concentrated public/state
as well as concentrated private/corporate power and notes a positive
relationship between democracy and more egalitarian outcomes that has
been documented by professor Rudrik. For a given level of manufacturing
productivity, his research on 93 nations has determined, factory workers
in relatively "free" countries (those with rudimentary parliamentary
institutions and political rights) like India make 30 percent more money
than their counterparts in "partly free" countries and 60 percent more
than workers in "unfree" nations like Western investment favorite China.
It is a great capitalist myth, Rudrik's work suggests, that wages are
simply set by the global "free market": governmental authoritarianism
pays out a significant profit dividend to local and international capital.
Democracy pays out an equally significant wage dividend to workers fortunate
enough to live in states with comparatively minimal repression. Contrary
to the editors at the Tribune, there is nothing "schizophrenic" about
post Allende Chile's simultaneous use of capitalist economics and savage
anti-left/anti-labor state repression: the latter makes eminent sense
for those who sit atop "private" economic power structures.
Anti-"Trade"/Anti-Empire: Two Sides of the Same Doha
Of special retrospective interest, given the recent Bush-mobilized
explosion of peace activism, the Tribune also deleted the anti-militarist
message that was clearly evident at the "anti-trade" TABD protests.
In Chicago as in other settings, the global justice movement last fall
was already making the connections between global inequality, militarism
and American Empire. They were catching up with something openly acknowledged
nearly four years ago by the explicitly imperialist corporate-globalization
enthusiast and leading New York Times foreign-affairs columnist Thomas
Friedman. "The hidden hand of the market," Friedman wrote as the US
prepared to bomb Serbia, "will never work without a hidden fist. McDonald's,"
he argued, "cannot flourish without McDonnell Douglas, the designer
of the F-15. And the hidden fist that keeps the world safe for Silicon
Valley technologies is called the US Army, Air Force, Navy and Marine
Corps."
Corporate neo-liberal globalization relies, we are learning with special
urgency since 9-11, on American imperial state power (see Street, "Anti-Empire,"
ZNet, February 19, 2004). There is nothing "schizophrenic" about Doha
(Qatar)'s dual status as (1) the home for recent world "trade" talks
and (2) a major US military encampment in preparation for the War on
Iraq. 1 and 2 are dialectically inseparable. They are two sides of the
same world state-capitalist coin.
Also missing from the Tribune's analysis last fall was any sense of
the anti-TABD protestors' opposition to social and related racial inequality
in Chicago and throughout the American "homeland." There was no mention
in its coverage of an excellent speech given prior to the aforementioned
march by African-American housing activist standing at the steps of
the Boeing Corporation. This speaker contrasted the massive expenditures
made to conduct the imperial "War on Terrorism" with the pittance spent
to help the very disproportionately black inner-city victims of a gentrification,
homelessness and other forms of heavily racialized socioeconomic homeland
insecurity experienced by America's millions of truly disadvantaged.
In Chicago as in other settings, the global justice movement today
is making the connections between world inequality, militarism, American
empire and domestic social, urban and racial injustice - something that
is very evident in recent actions (see my forthcoming Z Net Commentary,
"Making Connections: Confronting Hierarchy At Home and Abroad," March
14th). In the process, the falsely-labeled anti-"trade" movement has
fed quite naturally into an anti-imperialist peace and justice movement
that is connecting the dots between inequality, repression, thought
control, racism, regressive state authoritarianism and ruling-class
arrogance at home and abroad.
Public Dismissal, Private Concern
The president can publicly dismiss the significance and deny the core
concerns of global peace justice movements past and present. Privately,
however, Bush and his allies certainly know and acknowledge that they
have reason to worry and to pay attention to the real issues. Like the
"anti-globalization" movement it has partly subsumed, the new anti-imperialist
movement defies arrogant elitist stereotypes portraying it as a stupid
and reactionary effort to resist "progressive" change on the road to
a better, more "modern" "civilization." It is a smart, modern, and democratically
progressive force seeking to stop a barbarian, regressive, authoritarian
and top-down assault on standard civil rules of decent behavior at home
and abroad.
Paul Street ( pstreet@cul-chicago.org
) is the author of "Color Bind,"
a chapter in Tara Herivel and Paul Wright, Prison Nation: The Warehousing
of America's Poor (London: Routledge, 2002).
Halliburton
Halliburton news watch: http://www.hereinreality.com/news/halliburton.html
The ex-presidents' club The
Guardian
Oliver Burkeman and Julian Borger Wednesday October 31, 2001
It is hard to imagine an address
closer to the heart of American power. The offices of the Carlyle
Group are on Pennsylvania Avenue in Washington DC, midway between
the White House and the Capitol building, and within a stone's throw
of the headquarters of the FBI and numerous government departments. The
address reflects Carlyle's position at the very center of the Washington
establishment, but amid the frenetic politicking that has occupied
the higher reaches of that world in recent weeks, few have paid it
much attention. Elsewhere, few have even heard of it...
But since the start of the "war
on terrorism", the firm - unofficially valued at $13.5bn - has
taken on an added significance. Carlyle has become the thread which
indirectly links American military policy in Afghanistan to the personal
financial fortunes of its celebrity employees, not least the current
president's father. And, until earlier this month, Carlyle provided
another curious link to the Afghan crisis: among the firm's multi-million-dollar
investors were members of the family of Osama bin Laden
More...
Carlyle's Way Red
Herring Business Magazine
Dan Briody, author of The
Iron Triangle Wednesday January 8, 2002
Like everyone else in the United States, the group stood
transfixed as the events of September 11 unfolded. Present were former
secretary of defense Frank Carlucci, former secretary of state James
Baker III, and representatives of the bin Laden family. This was not
some underground presidential bunker or Central Intelligence Agency
interrogation room. It was the Ritz-Carlton in Washington, D.C., the
plush setting for the annual investor conference of one of the most
powerful, well-connected, and secretive companies in the world: the
Carlyle Group. And since September 11, this little-known company has
become unexpectedly important...
And as the Carlyle investors watched the World Trade
towers go down, the group's prospects went up. In running what
its own marketing literature spookily calls "a vast, interlocking,
global network of businesses and investment professionals" that
operates within the so-called iron triangle of industry, government,
and the military, the Carlyle Group leaves itself open to any number
of conflicts of interest and stunning ironies. For example, it is
hard to ignore the fact that Osama bin Laden's family members, who
renounced their son ten years ago, stood to gain financially from
the war being waged against him until late October, when public criticism
of the relationship forced them to liquidate their holdings in the
firm. Or consider that U.S. president George W. Bush is in a position
to make budgetary decisions that could pad his father's bank account.
But for the Carlyle Group, walking that narrow line is the art of
doing business at the murky intersection of Washington politics, national
security, and private capital; mastering it has enabled the group
to amass $12 billion in funds under management.
More...
DynCorp Disgrace
Jan. 14, 2002
By
Kelly Patricia O Meara
Middle-aged men having sex with 12-
to 15-year-olds was too much for Ben Johnston, a hulking 6-foot-5-inch
Texan, and more than a year ago he blew the whistle on his employer,
DynCorp, a U.S. contracting company doing business in Bosnia.
According to the Racketeer Influenced Corrupt Organization Act (RICO)
lawsuit filed in Texas on behalf of the former DynCorp aircraft
mechanic, "in the latter part of 1999 Johnston learned that employees
and supervisors from DynCorp were engaging in perverse, illegal
and inhumane behavior [and] were purchasing illegal weapons, women,
forged passports and [participating in] other immoral acts. Johnston
witnessed coworkers and supervisors literally buying and selling
women for their own personal enjoyment, and employees would brag
about the various ages and talents of the individual slaves they
had purchased."
Rather than acknowledge and reward Johnston's effort to get this
behavior stopped, DynCorp fired him, forcing him into protective
custody by the U.S. Army Criminal Investigation Division (CID) until
the investigators could get him safely out of Kosovo and returned
to the United States. That departure from the war-torn country was
a far cry from what Johnston imagined a year earlier when he arrived
in Bosnia to begin a three-year U.S. Air Force contract with DynCorp
as an aircraft-maintenance technician for Apache and Blackhawk helicopters.
For more than 50 years DynCorp, based in Reston, Va., has been a
worldwide force providing maintenance support to the U.S. military
through contract field teams (CFTs). As one of the federal government's
top 25 contractors, DynCorp has received nearly $1 billion since
1995 for these services and has deployed 181 personnel to Bosnia
during the last six years. Although DynCorp long has been respected
for such work, according to Johnston and internal DynCorp communications
it appears that extracurricular sexcapades on the part of its employees
were tolerated by some as part of its business in Bosnia.
But DynCorp was nervous. For instance, an internal e-mail from DynCorp
employee Darrin Mills, who apparently was sent to Bosnia to look
into reported problems, said, "I met with Col. Braun [a base supervisor]
yesterday. He is very concerned about the CID investigation; however,
he views it mostly as a DynCorp problem. What he wanted to talk
about most was how I am going to fix the maintenance problems here
and how the investigation is going to impact our ability to fix
his airplanes." The Mills e-mail continued: "The first thing he
told me is that 'they are tired of having smoke blown up their ass.'
They don't want anymore empty promises."
An e-mail from Dyncorp's Bosnia site supervisor, John Hirtz (later
fired for alleged sexual indiscretions), explains DynCorp's position
in Bosnia. "The bottom line is that DynCorp has taken what used
to be a real positive program that has very high visibility with
every Army unit in the world and turned it into a bag of worms.
Poor quality was the major issue."
Johnston was on the ground and saw firsthand what the military was
complaining about. "My main problem," he explains, "was [sexual
misbehavior] with the kids, but I wasn't too happy with them ripping
off the government, either. DynCorp is just as immoral and elite
as possible, and any rule they can break they do. There was this
one guy who would hide parts so we would have to wait for parts
and, when the military would question why it was taking so long,
he'd pull out the part and say 'Hey, you need to install this.'
They'd have us replace windows in helicopters that weren't bad just
to get paid. They had one kid, James Harlin, over there who was
right out of high school and he didn't even know the names and purposes
of the basic tools. Soldiers that are paid $18,000 a year know more
than this kid, but this is the way they [DynCorp] grease their pockets.
What they say in Bosnia is that DynCorp just needs a warm body —
that's the DynCorp slogan. Even if you don't do an eight-hour day,
they'll sign you in for it because that's how they bill the government.
It's a total fraud."
Remember, Johnston was fired by this company. He laughs bitterly
recalling the work habits of a DynCorp employee in Bosnia who "weighed
400 pounds and would stick cheeseburgers in his pockets and eat
them while he worked. The problem was he would literally fall asleep
every five minutes. One time he fell asleep with a torch in his
hand and burned a hole through the plastic on an aircraft." This
same man, according to Johnston, "owned a girl who couldn't have
been more than 14 years old. It's a sick sight anyway to see any
grown man [having sex] with a child, but to see some 45-year-old
man who weighs 400 pounds with a little girl, it just makes you
sick." It is precisely these allegations that Johnston believes
got him fired.
Johnston reports that he had been in Bosnia only a few days when
he became aware of misbehavior in which many of his DynCorp colleagues
were involved. He tells INSIGHT, "I noticed there were problems
as soon as I got there, and I tried to be covert because I knew
it was a rougher crowd than I'd ever dealt with. It's not like I
don't drink or anything, but DynCorp employees would come to work
drunk. A DynCorp van would pick us up every morning and you could
smell the alcohol on them. There were big-time drinking issues.
I always told these guys what I thought of what they were doing,
and I guess they just thought I was a self-righteous fool or something,
but I didn't care what they thought."
The mix of drunkenness and working on multimillion-dollar aircraft
upon which the lives of U.S. military personnel depended was a serious
enough issue, but Johnston drew the line when it came to buying
young girls and women as sex slaves. "I heard talk about the prostitution
right away, but it took some time before I understood that they
were buying these girls. I'd tell them that it was wrong and that
it was no different than slavery — that you can't buy women. But
they'd buy the women's passports and they [then] owned them and
would sell them to each other."
"At first," explains Johnston, "I just told the guys it was wrong.
Then I went to my supervisors, including John Hirtz, although at
the time I didn't realize how deep into it he was. Later I learned
that he had videotaped himself having sex with two girls and CID
has that video as evidence. Hirtz is the guy who would take new
employees to the brothels and set them up so he got his women free.
The Serbian mafia would give Hirtz the women free and, when one
of the guys was leaving the country, Hirtz would go to the mafia
and make sure that the guys didn't owe them any money."
"None of the girls," continues Johnston, "were from Bosnia. They
were from Russia, Romania and other places, and they were imported
in by DynCorp and the Serbian mafia. These guys would say 'I gotta
go to Serbia this weekend to pick up three girls.' They talk about
it and brag about how much they pay for them — usually between $600
and $800. In fact, there was this one guy who had to be 60 years
old who had a girl who couldn't have been 14. DynCorp leadership
was 100 percent in bed with the mafia over there. I didn't get any
results from talking to DynCorp officials, so I went to Army CID
and I drove around with them, pointing out everyone's houses who
owned women and weapons."
That's when Johnston's life took a dramatic turn.
On June 2, 2000, members of the 48th Military Police Detachment
conducted a sting on the DynCorp hangar at Comanche Base Camp, one
of two U.S. bases in Bosnia, and all DynCorp personnel were detained
for questioning. CID spent several weeks working the investigation
and the results appear to support Johnston's allegations. For example,
according to DynCorp employee Kevin Werner's sworn statement to
CID, "during my last six months I have come to know a man we call
'Debeli,' which is Bosnian for fat boy. He is the operator of a
nightclub by the name of Harley's that offers prostitution. Women
are sold hourly, nightly or permanently."
Werner admitted to having purchased a woman to get her out of prostitution
and named other DynCorp employees who also had paid to own women.
He further admitted to having purchased weapons (against the law
in Bosnia) and it was Werner who turned over to CID the videotape
made by Hirtz. Werner apparently intended to use the video as leverage
in the event that Hirtz decided to fire him. Werner tells CID, "I
told him [Hirtz] I had a copy and that all I wanted was to be treated
fairly. If I was going to be fired or laid off, I wanted it to be
because of my work performance and not because he was not happy
with me."
According to Hirtz's own sworn statement to CID, there appears to
be little doubt that he did indeed rape one of the girls with whom
he is shown having sexual intercourse in his homemade video.
CID: Did you have sexual intercourse with the second woman
on the tape?
Hirtz: Yes
CID: Did you have intercourse with the second woman after
she said "no" to you?
Hirtz: I don't recall her saying that. I don't think it was
her saying "no."
CID: Who do you think said "no"?
Hirtz: I don't know.
CID: According to what you witnessed on the videotape played
for you in which you were having sexual intercourse with the second
woman, did you have sexual intercourse with the second woman after
she said "no" to you?
Hirtz: Yes.
CID: Did you know you were being videotaped?
Hirtz: Yes. I set it up.
CID: Did you know it is wrong to force yourself upon someone
without their consent?
Hirtz: Yes.
The CID agents did not ask any of the men involved what the ages
of the "women" were who had been purchased or used for prostitution.
According to CID, which sought guidance from the Office of the Staff
Judge Advocate in Bosnia, "under the Dayton Peace Accord, the contractors
were protected from Bosnian law which did not apply to them. They
knew of no [U.S.] federal laws that would apply to these individuals
at this time."
However, CID took another look and, according to the investigation
report, under Paragraph 5 of the NATO Agreement Between the Republic
of Bosnia-Herzegovina and Croatia regarding the status of NATO and
its personnel, contractors "were not immune from local prosecution
if the acts were committed outside the scope of their official duties."
Incredibly, the CID case was closed in June 2000 and turned over
to the Bosnian authorities. DynCorp says it conducted its own investigation,
and Hirtz and Werner were fired by DynCorp and returned to the United
States but were not prosecuted. Experts in slave trafficking aren't
buying the CID's interpretation of the law.
Widney Brown, an advocate for Human Rights Watch, tells INSIGHT
"our government has an obligation to tell these companies that this
behavior is wrong and they will be held accountable. They should
be sending a clear message that it won't be tolerated. One would
hope that these people wouldn't need to be told that they can't
buy women, but you have to start off by laying the ground rules.
Rape is a crime in any jurisdiction and there should not be impunity
for anyone. Firing someone is not sufficient punishment. This is
a very distressing story — especially when you think that these
people and organizations are going into these countries to try and
make it better, to restore a rule of law and some civility."
Christine Dolan, founder of the International Humanitarian Campaign
Against the Exploitation of Children, a Washington-based nonprofit
organization, tells Insight: "What is surprising to me is that Dyncorp
has kept this contract. The U.S. says it wants to eradicate trafficking
of people, has established an office in the State Department for
this purpose, and yet neither State nor the government-contracting
authorities have stepped in and done an investigation of this matter."
Dolan says, "It's not just Americans who are participating in these
illegal acts. But what makes this more egregious for the U.S. is
that our purpose in those regions is to restore some sense of civility.
Now you've got employees of U.S. contractors in bed with the local
mafia and buying kids for sex! That these guys have some kind of
immunity from prosecution is morally outrageous. How can men be
allowed to get away with rape simply because of location? Rape is
a crime no matter where it occurs and it's important to remember
that even prostitution is against the law in Bosnia. The message
we're sending to kids is that it's okay for America's representatives
to rape children. We talk about the future of the children, helping
to build economies, democracy, the rule of law, and at the same
time we fail to prosecute cases like this. That is immoral and hypocritical,
and if DynCorp is involved in this in any way it should forfeit
its contract and pay restitution in the form of training about trafficking."
Charlene Wheeless, a spokeswoman for DynCorp, vehemently denies
any culpability on the part of the company, According to Wheeless,
"The notion that a company such as DynCorp would turn a blind eye
to illegal behavior by our employees is incomprehensible. DynCorp
adheres to a core set of values that has served as the backbone
of our corporation for the last 55 years, helping us become one
of the largest and most respected professional-services and outsourcing
companies in the world. We can't stress strongly enough that, as
an employee-owned corporation, we take ethics very seriously. DynCorp
stands by its decision to terminate [whistle-blower] Ben Johnston,
who was terminated for cause."
What was the "cause" for which Johnston was fired? He received his
only reprimand from DynCorp one day prior to the sting on the DynCorp
hangar when Johnston was working with CID. A week later he received
a letter of discharge for bringing "discredit to the company and
the U.S. Army while working in Tuzla, Bosnia-Herzegovina." The discharge
notice did not say how Johnston "brought discredit to the company."
It soon developed conveniently, according to Johnston's attorneys,
that he was implicated by a DynCorp employee for illegal activity
in Bosnia. Harlin, the young high-school graduate Johnston complained
had no experience in aircraft maintenance and didn't even know the
purposes of the basic tools, provided a sworn statement to CID about
Johnston. Asked if anyone ever had offered to sell him a weapon,
Harlin fingered Johnston and DynCorp employee Tom Oliver, who also
had disapproved of the behavior of DynCorp employees.
Harlin even alleged that Johnston was "hanging out with Kevin Werner."
Although Werner had no problem revealing the names and illegal activities
of other DynCorp employees, Werner did not mention Johnston's name
in his sworn statement.
Kevin Glasheen, Johnston's attorney, says flatly of this: "It's
DynCorp's effort to undermine Ben's credibility. But I think once
the jury hears this case, that accusation is only going to make
them more angry at DynCorp. In order to make our claim, we have
to show that DynCorp was retaliating against Ben, and that fits
under racketeering. There is a lot of evidence that shows this was
what they were doing and that it went all the way up the management
chain."
According to Glasheen, "DynCorp says that whatever these guys were
doing isn't corporate activity and they're not responsible for it.
But this problem permeated their business and management and they
made business decisions to further the scheme and to cover it up.
We have to show that there was a causal connection between Ben's
whistle-blowing about the sex trade and his being fired. We can
do that. We're here to prove a retaliation case, not convict DynCorp
of participating in the sex-slave trade.
"What you have here is a Lord of the Flies mentality. Basically
you've got a bunch of strong men who are raping and manipulating
young girls who have been kidnapped from their homes. Who's the
bad guy? Is it the guy who buys the girl to give her freedom, the
one who kidnaps her and sells her or the one who liberates her and
ends up having sex with her? And what does it mean when the U.S.
steps up and says, 'We don't have any jurisdiction'? That's absurd."
The outraged attorney pauses for breath. "This is more than one
twisted mind. There was a real corporate culture with a deep commitment
to a cover-up. And it's outrageous that DynCorp still is being paid
by the government on this contract. The worst thing I've seen is
a DynCorp e-mail after this first came up where they're saying how
they have turned this thing into a marketing success, that they
have convinced the government that they could handle something like
this."
Johnston is not the only DynCorp employee to blow the whistle and
sue the billion-dollar government contractor. Kathryn Bolkovac,
a U.N. International Police Force monitor hired by the U.S. company
on another U.N.-related contract, has filed a lawsuit in Great Britain
against DynCorp for wrongful termination. DynCorp had a $15 million
contract to hire and train police officers for duty in Bosnia at
the time she reported such officers were paying for prostitutes
and participating in sex-trafficking. Many of these were forced
to resign under suspicion of illegal activity, but none have been
prosecuted, as they also enjoy immunity from prosecution in Bosnia.
DynCorp has admitted it fired five employees for similar illegal
activities prior to Johnston's charges.
But Johnston worries about what this company's culture does to the
reputation of the United States. "The Bosnians think we're all trash.
It's a shame. When I was there as a soldier they loved us, but DynCorp
employees have changed how they think about us. I tried to tell
them that this is not how all Americans act, but it's hard to convince
them when you see what they're seeing. The fact is, DynCorp is the
worst diplomat you could possibly have over there."
Johnston's attorney looks to the outcome. "How this all ends," says
Glasheen, "will say a lot about what we stand for and what we won't
stand for."
Kelly Patricia O'Meara is an investigative reporter for Insight.
US Companies Quietly Caught Trading with the Enemy Commentary:
U.S. Companies Risk Only a Wrist Slap
By Rex Nutting
CBS.MarketWatch.com
Tuesday 15 April 2003
When individual Americans are accused of helping terrorists,
they're thrown in jail and their names are dragged through the mud.
But when major U.S. corporations are caught trading with the enemy,
they get just a slap on the wrist from the government.
WASHINGTON -- In the past two weeks, the government has revealed
that 57 companies and organizations have been fined for doing business
with terrorists, despots and tyrants.
However, neither the government nor the companies are forthcoming
with the public about the details of the illicit trade with rogue
governments like Iraq, Cuba, North Korea, Iran and Sudan. Read
about the laws.
The fact that the New York Yankees and ESPN have been caught doing
business with Fidel Castro won't be on any highlight film. ChevronTexaco
hasn't bragged about breaking the sanctions against Saddam Hussein's
Iraq. Citigroup hasn't issued a press release extolling how it helped
finance terrorist groups.
With a few exceptions, it is against the law for U.S. companies and
individuals to have commercial or financial dealings with several
countries as well as dozens of terrorist or drug organizations. Read
the list.
Each year, the government investigates thousands of cases of U.S.
individuals or companies for alleged violations of the Trading with
the Enemy Act and other statutes and executive orders that restrict
free trade. Each year, the government imposes millions of dollars
in civil penalties and prosecutes 10 or so criminal cases.
We know why the companies are silent about what they've done. No
one wants to be associated in the public mind with torturers, thugs
and murderers, even if it's profitable to be associated with them
in private. The companies' explanations, when available, show that
even the most enthusiastic supporter of sanctions can run afoul of
the law through no malice on their part.
But why are the government's cops so reluctant to tell us about the
crooks they've captured? Who ever heard of a shy prosecutor, especially
one who can show success in the war against terrorism?
Double standard
When deranged American citizens are accused of working with terrorist
groups like al-Qaida, Attorney General John Ashcroft holds a press
conference and the FBI puts a new name and face on its Top 10 Most
Wanted List, even though the allegations have not been proved in court.
The suspects can languish in jail for months without any formal charges.
And when a Muslim charity is suspected of laundering funds for alleged
terror groups, the Treasury Department shuts it down and freezes its
assets.
But when multinational corporations like Wal-Mart, Dow Chemical,
ExxonMobil and Amazon.com agree with government prosecutors that they
have violated laws that prohibit doing business with enemy states,
the news is buried on an
obscure government Web site.
57 companies fined
In the past two weeks, the Treasury's Office of Foreign Asset Control
has revealed that 57 companies and organizations have been fined more
than $1.35 million for civil violations of the sanctions laws.
For the first time, the government will provide weekly updates on
the status of its civil cases. But the information provided by the
government about these violations is paltry, and unless you've memorized
the law, you'll never understand that "EO13121 FT" means an illegal
funds transfer to the former Yugoslavia.
The government has provided almost no information about the civil
cases except what country the company traded with and what the penalty
was. No dates, no details, no way of knowing if the violations were
egregious or inadvertent. No way of knowing if the companies sold
brass knuckles to the secret police or baby formula to an orphanage.
"The Treasury is giving in to corporate pressure," said Russell Mokhiber,
editor of the Corporate Crime Reporter, who sued the government under
the Freedom of Information Act to learn the details of earlier violations
of the trade sanctions laws.
"To deter future corporate wrongdoing, [the Treasury] must stop protecting
major American companies from the glare of adverse publicity," Mokhiber
said Monday at a press conference.
"This is the maximum information that we can make available consistent
with legal concerns," said a Treasury Department spokesman who would
not even provide his name for publication.
Largest case
The largest penalty levied among the 59 public cases was $250,000
against Zim American Israeli Shipping Co. of Norfolk, Va., for trade
with Cuba. Zim, which is about half owned by the Israeli government,
is one of the largest shipping companies in the world.
Nobody at the Norfolk office of Zim knew anything concrete about
the penalty. "I think it happened a long time ago," said one official.
But they do know about terrorism. The company relocated from the
16th floor of the World Trade Center just a week before the Sept.
11 attack, sparking speculation in the conspiracy press that the Israeli
Mossad had tipped off the company ahead of time.
As for the Cubans, "I think they are very poor," the Zim official
said.
The next largest penalty was imposed on IGI Inc. of Buena, N.J.,
which makes cosmetics and which recently sold its pet food and veterinary
products units. The government said they exported something prohibited
to Iran. The company said it would look into the matter and get back
to us.
Norwegian-owned shipping company Stolt-Nielsen Transportation Group
of Greenwich, Conn., was fined $95,000 for an illegal fund transfer
to Sudan.
Yankees and Cubans
The New York Yankees were fined $75,000 for signing a contract in
which the Cuban government had an interest. Newsday reported Tuesday
that the contracts involved pitcher Orlando "El Duque" Hernandez and
three other unnamed Cuban players.
Hernandez has always maintained that he escaped from Cuba to the
Bahamas in a wooden fishing boat in late 1997 after being banned from
baseball in his homeland following the defection of his brother, Livan,
who was the World Series star for the Florida Marlins that fall. It
is not clear how his subsequent signing by the Yankees would have
involved a payment to the Cuban government.
The Yankees' contract with Jose Contreras is not in violation of
the law, Yankee president Randy Levine told the paper.
Wal-Mart was fined $50,000 for dealings with Cuba. A Wal-Mart spokesman
said some pajamas sold to its Canadian operations "might have originated
in Cuba." The company paid the fine "voluntarily" after lengthy discussions
with government lawyers and there was "never any determination of
a violation," he said.
Blue chips caught red handed; The other big fines:
* ExxonMobil was fined $50,000 for exports to Sudan.
* ChevronTexaco was fined a total of $14,071.07 for deals with
Cuba and Iraq. A company spokesman told the Corporate Crime Reporter
that the company bought oil from Iraq under the U.N. Oil for Food
program and that a payment was inadvertently paid to an Iraqi government
port official.
* Axon Corp. of Raleigh, N.C., was fined $45,000 for exports to
Iran. The company makes packaging equipment.
* Fleet Bank was fined $41,000 for financial dealings with Cuba
and Iran.
* ESPN was fined $39,000 for a contract with Cuba. A spokesman
at the sports cable network said the network's South American unit
had paid some travel expenses for the Cuban team at a major international
volleyball tournament held in Argentina in 1998 and televised by
the ESPN Sur network. The company is owned by Disney and privately
held Hearst.
* Royal Crown was fined $38,000 for exports to Sudan. The soft-drink
company is now owned by Snapple, which in turn is owned by Cadbury
Schweppes.
And a couple of minor but intriguing infractions:
Citigroup was fined $2,925 for violating laws against financing terrorism.
A spokesman for the financial services giant did not return a phone
call seeking comment. It was the only penalty on the government's
list for violation of the anti-terrorism financing law.
The International Union of Pure and Applied Chemistry in Research
Triangle Park, N.C., was fined $500 for violating laws against the
proliferation of weapons of mass destruction. A spokesman for the
group did not return a phone call. It was the only penalty on the
government's list for violations of nonproliferation laws.
Rex Nutting is Washington bureau chief of CBS.MarketWatch.com.
Top 100 Corporate Criminals of 1990
www.corporatecrimereporter.com
by Russell Mokhiber
Top
100 Corporate Criminals -- Brief List
Top
100 Corporate Criminals -- Annotated Version
INTRODUCTION
Every year, the major business magazines put out their annual surveys
of big business in America.
You have the Fortune 500, the Forbes 400, the Forbes Platinum 100,
the International 800 -- among others.
These lists rank big corporations by sales, assets, profits and market
share. The point of these surveys is simple -- to identify and glorify
the biggest and most profitable corporations.
The point of the list contained in this report, The Top 100 Corporate
Criminals of the Decade -- is to focus public attention on a wave
of corporate criminality that has swamped prosecutors offices around
the country.
This is the dark underside of the marketplace that is given little
sustained attention and analysis by politicians and news outlets.
To compile The Top 100 Corporate Criminals of the 1990s, we used the
most narrow and conservative of definitions -- corporations that have
pled guilty or no contest to crimes and have been criminally fined.
The 100 corporate criminals fell into 14 categories of crime: Environmental
(38), antitrust (20), fraud (13), campaign finance (7), food and drug
(6), financial crimes (4), false statements (3), illegal exports (3),
illegal boycott (1), worker death (1), bribery (1), obstruction of
justice (1) public corruption (1), and tax evasion (1).
We did not try to assess and compare the damage committed by these
corporate criminals or by other corporate wrongdoers.
There are millions of Americans who care about morality in the marketplace.
But few Americans realize that when they buy Exxon stock, or when
they fill up at an Exxon gas station, they are in fact supporting
a criminal recidivist corporation.And few Americans realize that when
the take a ride on a cruise ship owned by Royal Caribbean Cruise Lines,
they are riding on a ship owned by a criminal recidivist corporation.
Six corporations that made the list of the Top 100 Corporate Criminals
were criminal recidivist companies during the 1990s.
In addition to Exxon and Royal Caribbean, Rockwell International,
Warner-Lambert, Teledyne, and United Technologies each pled guilty
to more than one crime during the 1990s.
A few caveats about this report.
Caveat one: Big companies that are criminally prosecuted represent
only the tip of a very large iceberg of corporate wrongdoing.
For every company convicted of health care fraud, there are hundreds
of others who get away with ripping off Medicare and Medicaid, or
face only mild slap-on-the-wrist fines and civil penalties when caught.
For every company convicted of polluting the nation's waterways, there
are many others who are not prosecuted because their corporate defense
lawyers are able to offer up a low-level employee to go to jail in
exchange for a promise from prosecutors not to touch the company or
high-level executives.
For every corporation convicted of bribery or of giving money directly
to a public official in violation of federal law, there are thousands
who give money legally through political action committees to candidates
and political parties. They profit from a system that effectively
has legalized bribery.
For every corporation convicted of selling illegal pesticides, there
are hundreds more who are not prosecuted because their lobbyists have
worked their way in Washington to ensure that dangerous pesticides
remain legal.
For every corporation convicted of reckless homicide in the death
of a worker, there are hundreds of others that don't even get investigated
for reckless homicide when a worker is killed on the job. Only a few
district attorneys across the country (Michael McCann, the DA in Milwaukee
County, Wisconsin, being one) regularly investigate workplace deaths
as homicides.Caveat two: Corporations define the laws under which
they live.
For example, the automobile industry over the past 30 years has worked
its will on Congress to block legislation that would impose criminal
sanctions on knowing and willful violations of the federal auto safety
laws. Now, if an auto company is caught violating the law, and if
the cops are not asleep at the wheel, only a civil fine is imposed.
Caveat three: Because of their immense political power, big corporations
have the resources to defend themselves in courts of law and in the
court of public opinion.
Few prosecutors are willing to subject themselves to the constant
legal and public relations barrage that a corporation's well connected
and high-priced legal talent can inflict.
It is a testament to the tenacity of a few dedicated federal prosecutors
that Royal Caribbean Cruise Lines, for example, was criminally convicted
of polluting the oceans.
In the criminal prosecution of Royal Caribbean Cruise Lines the company
was facing a team of two federal criminal prosecutors.
To defend itself, Royal Caribbean hired Judson Starr and Jerry Block,
both of whom have served as head of the Justice Department's Environmental
Crimes Section, and former Attorney General Benjamin Civiletti.
Also representing Royal Caribbean were former federal prosecutors
Kenneth C. Bass III, and Norman Moscowitz. Donald Carr of Winthrop
& Stimson also joined the defense team.
Hired on as experts on international law issues were former Attorney
General Eliot Richardson, University of Virginia law professor John
Norton Moore, former State Department officials Terry Leitzell and
Bernard Oxman, and four retired senior admirals.
As the case proceeded to trial, Royal Caribbean engaged in a massive
public relations campaign, taking out ads during the Super Bowl, putting
former Environmental Protection Agency (EPA) Administrators on its
board of directors, and donating thousands of dollars to environmental
groups.
Federal prosecutors overcame this legal and public relations barrage
and convicted the company. But that was an unusual prosecution and
unusually determined prosecutors.
While the 1990s was a decade of booming markets and booming profits,
it was also a decade of rampant corporate criminality.
There is an emerging consensus among corporate criminologists.
And that emerging consensus is this: corporate crime and violence
inflicts far more damage on society than all street crime combined.
The FBI estimates, for example, that burglary and robbery -- street
crimes -- costs the nation $3.8 billion a year.
Compare this to the hundreds of billions of dollars stolen from Americans
as a result of corporate and white-collar fraud.
Health care fraud alone costs Americans $100 billion to $400 billion
a year.
The savings and loan fraud -- which former Attorney General Dick Thornburgh
called "the biggest white collar swindle in history" --
cost us anywhere from $300 billion to $500 billion.
And then you have your lesser frauds: auto repair fraud, $40 billion
a year, securities fraud, $15 billion a year -- and on down the list.
Recite this list of corporate frauds and people will immediately say
to you: but you can't compare street crime and corporate crime --
corporate crime is not violent crime.
Unfortunately, corporate crime is often violent crime.
The FBI estimates that, 19,000 Americans are murdered every year.
Compare this to the 56,000 Americans who die every year on the job
or from occupational diseases such as black lung and asbestosis and
the tens of thousands of other Americans who fall victim to the silent
violence of pollution, contaminated foods, hazardous consumer products,
and hospital malpractice.
These deaths are often the result of criminal recklessness. They are
sometimes prosecuted as homicides or as criminal violations of federal
laws.
And environmental crimes often result in death, disease and injury.
In 1998, for example, a Tampa, Florida company and the company's plant
manager were found guilty of violating a federal hazardous waste law.
Those illegal acts resulted in the deaths of two nine-year-old boys
who were playing in a dumpster at the company's facility.This report
is only a tiny step in an effort to fill a great void in corporate
crime research.
The Justice Department has the information and should get the budget
to begin putting out yearly reports on corporate crime.
Every year, the Justice Department puts out an annual report titled
"Crime in the United States."
But by "Crime in the United States," the Justice Department
means "street crime in the United States."
So, in "Crime in the United States" document you will read
about burglary, robbery and theft. There is nothing in it about price-fixing,
corporate fraud, pollution, or public corruption.
A yearly Justice Department report on Corporate Crime in the United
States is long overdue.
go to the list:
Top 100 Corporate Criminals -- Brief List
Top
100 Corporate Criminals -- Annotated Version
www.corporatecrimereporter.com
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