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Offshore Corporate Tax Havens: Why Are They Still Allowed?

Posted by Arianna Huffington on June 1st, 2010

Originally posted on June 1 on The Huffington Post.

The bracing reality that America has two sets of rules -- one for the corporate class and another for the middle class -- has never been more indisputable.

The middle class, by and large, plays by the rules, then watches as its jobs disappear -- and the Senate takes a break instead of extending unemployment benefits. The corporate class games the system -- making sure its license to break the rules is built into the rules themselves.

One of the most glaring examples of this continues to be the ability of corporations to cheat the public out of tens of billions of dollars a year by using offshore tax havens. Indeed, it's estimated that companies and wealthy individuals funneling money through offshore tax havens are evading around $100 billion a year in taxes -- leaving the rest of us to pick up the tab. And with cash-strapped states all across the country cutting vital services to the bone, it's not like we don't need the money.

You want Exhibit A of two sets of rules? According to the White House, in 2004, the last year data on this was compiled, U.S. multinational corporations paid roughly $16 billion in taxes on $700 billion in foreign active earnings -- putting their tax rate at around 2.3 percent. Know many middle class Americans getting off that easy at tax time?

In December 2008, the Government Accounting Office reported that 83 of the 100 largest publicly-traded companies in the country -- including AT&T, Chevron, IBM, American Express, GE, Boeing, Dow, and AIG -- had subsidiaries in tax havens -- or, as the corporate class comically calls them, "financial privacy jurisdictions."

Even more egregiously, of those 83 companies, 74 received government contracts in 2007. GM, for instance, got more than $517 million from the government -- i.e. the taxpayers -- that year, while shielding profits in tax-friendly places like Bermuda and the Cayman Islands. And Boeing, which received over $23 billion in federal contracts that year, had 38 subsidiaries in tax havens, including six in Bermuda.

And while it's as easy as opening up an island P.O. Box, not every big company uses the dodge. For instance, Boeing's competitor Lockheed Martin had no offshore subsidiaries. But far too many do -- another GAO study found that over 18,000 companies are registered at a single address in the Cayman Islands, a country with no corporate or capital gains taxes.

America's big banks -- including those that pocketed billions from the taxpayers in bailout dollars -- seem particularly fond of the Cayman Islands. At the time of the GAO report, Morgan Stanley had 273 subsidiaries in tax havens, 158 of them in the Cayman Islands. Citigroup had 427, with 90 in the Caymans. Bank of America had 115, with 59 in the Caymans. Goldman Sachs had 29 offshore havens, including 15 in the Caymans. JPMorgan had 50, with seven in the Caymans. And Wells Fargo had 18, with nine in the Caymans.

Perhaps no company exemplifies the corporate class/middle class double standard more than KBR/Halliburton. The company got billions from U.S. taxpayers, then turned around and used a Cayman Island tax dodge to pump up its bottom line. As the Boston Globe's Farah Stockman reported, KBR, until 2007 a unit of Halliburton, "has avoided paying hundreds of millions of dollars in federal Medicare and Social Security taxes by hiring workers through shell companies based in this tropical tax haven."

In 2008, the company listed 10,500 Americans as being officially employed by two companies that, as Stockman wrote, "exist in a computer file on the fourth floor of a building on a palm-studded boulevard here in the Caribbean." Aside from the tax advantages, Stockman points out another benefit of this dodge: Americans who officially work for a company whose headquarters is a computer file in the Caymans are not eligible for unemployment insurance or other benefits when they get laid off -- something many of them found out the hard way.

This kind of sun-kissed thievery is nothing new. Indeed, back in 2002, to call attention to the outrage of the sleazy accounting trick, I wrote a column announcing I was thinking of moving my syndicated newspaper column to Bermuda:

I'll still live in America, earn my living here, and enjoy the protection, technology, infrastructure, and all the other myriad benefits of the land of the free and the home of the brave. I'm just changing my business address. Because if I do that, I won't have to pay for those benefits -- I'll get them for free!

Washington has been trying to address the issue for close to 50 years -- JFK gave it a go in 1961. But time and again Corporate America's game fixers -- aka lobbyists -- and water carriers in Congress have managed to keep the loopholes open.

The battle is once again afoot. On Friday, the House passed the American Jobs and Closing Tax Loopholes Act. The bill, in addition to extending unemployment benefits, clamps down on some of they ways corporations hide their income offshore to avoid paying U.S. taxes. Even though practically every House Republican voted against it, the bill passed 215 to 204.

The bill's passage in the Senate, however, remains in doubt, with lobbyists gearing up for a furious fight to make sure America's corporate class can continue to profitably enjoy the largess of government services and contracts without the responsibility of paying its fair share.

The bill is far from perfect -- it leaves open a number of loopholes and would only recoup a very small fraction of the $100 billion corporations and wealthy individuals are siphoning off from the U.S. Treasury. And it wouldn't ban companies using offshore tax havens from receiving government contracts, which is stunning given the hard times we are in and the populist groundswell at the way average Americans are getting the short end of the stick.

But the bill would end one of the more egregious examples of the double standard between the corporate class and the middle class, finally forcing hedge fund managers to pay taxes at the same rate as everybody else. As the law stands now, their income is considered "carried interest," and is accordingly taxed at the capital gains rate of 15 percent.

The issue was famously brought up in 2007 by Warren Buffett when he noted that his receptionist paid 30 percent of her income in taxes, while he paid only 17.7 percent on his taxable income of $46 million dollars.

As Robert Reich points out, the 25 most successful hedge fund managers earned $1 billion each. The top earner clocked in at $4 billion. And all of them paid taxes at about half the rate of Buffett's receptionist.

Closing this outrageous loophole would bring in close to $20 billion dollars in revenue -- money desperately needed at a time when teachers and nurses and firemen are being laid off all around the country.

Hedge fund lobbyists are currently hacking away at the Senate's resolve with, not surprisingly, some success. And it's not just Republicans who are willing to do their bidding, but a number of Democrats as well. Indeed, it was a Democrat -- Chuck Schumer -- who led the fight against closing the loophole in 2007.

"I don't know how members of Congress can return home and look an office manager, a nurse, a court clerk in the eye and say 'I chose hedge fund managers instead of you and your family'," said Lori Lodes of the SEIU.

Nicole Tichon, of the U.S. Public Interest Research Group, framed the debate in similar terms:

It's hard to imagine anyone campaigning on protecting hedge fund managers, Wall Street banks and companies that ship jobs and profits overseas. It's hard to imagine telling constituents that somehow they should continue to subsidize these industries. We're anxious to see whose side the Senate is on and what story they want to tell the American people.

Up until now, the story has been a familiar narrative of Two Americas, with one set of rules for those who can afford to hire a fleet of K Street lobbyists and a different set for everybody else. It's time to give this infuriating tale a different -- and far more just and satisfying -- ending.




Coming Soon to CNN: The PVC Manufacturing Capital of America

Posted by Mike Schade on May 19th, 2010

Originally posted on May 18 at The Center for Health, Environment & Justice.

On June 2nd at 8pm, CNN’s Dr. Sanjay Gupta will be airing an hour-long investigative story into the environmental health and justice problems plaguing the community of Mossville, Louisiana. Nestled amidst an alarming cluster of chemical plants, Mossville is home to more PVC chemical plants than anywhere else in the entire country, and has been dubbed the Vinyl Manufacturing Capital of America.

CNN broke a terrific story a few weeks ago profiling Mossville which you can watch in this embedded video below.  Dr. Sanjay Gupta’s June 2nd feature will explore how Mossville has been polluted by the chemical industry with vinyl chloride, Dioxins, and other harmful chemicals.

From Buffalo, NY to Mossville, Louisiana

I traveled to Mossville back in 2004 as part of an environmental health delegation that I led and organized, to bear witness to the environmental pollution the chemical industry has brought to this poor African American community.  CertainTeed, one of our nation’s largest PVC manufacturers, was building a PVC fabrication plant on the Lake Erie waterfront in Buffalo, and we wanted to investigate how CertainTeed and other PVC plants had impacted Mossville in Louisiana.  CertainTeed’s chemicals were manufactured just outside Mossville, and were then shipped to Buffalo to be fabricated.

At the time I was no stranger to contaminated communities.  I had visited and worked with many impacted communities in the Buffalo area, from homeowners in Hickory Woods whose neighborhood was built on toxic waste, to parents fighting the only hazardous waste landfill in the Northeastern united States.

I was no stranger to toxic pollution, but was not prepared for the scope of pollution and cluster of chemical plants bordering this environmental justice community.  Me and a few colleagues went on a toxic tour led by Mr. Edgar Mouton Jr., who is an inspiration to me.  We met with concerned residents and former workers, and drove around parts of the community that had been turned into a ghost town – scores of homes were evacuated due to the plume of chemicals seeping into the neighborhood. We listened to residents’ stories of cancer, asthma, and reproductive health problems – diseases residents were sure was a result of the chemical industry.

I will never forget that visit.  That experience and trip stays with me every day, and it motivates me to continue fighting for environmental health and justice.



A Posterchild for the PVC Chemical Industry

Mossville is not an isolated example, but instead a poster child for a broken chemical safety system.  Mossville is also a posterchild for the PVC chemical industry’s pollution, as PVC plants are disproportionately located in low-income communities and communities of color, making the production of PVC a major environmental justice concern for neighboring residents.

Community members, led by Mossville Environmental Action Now, have been fighting for a healthy community for years.  Just consider some of these alarming facts:

    * A jury found one of the United States’ leading PVC manufacturers liable for “wanton and reckless disregard of public safety”, caused by one of the largest chemical spills in the nation’s history which contaminated the groundwater underneath the surrounding community.

    * A 1999 U.S. Environmental Protection Agency (EPA) study found vinyl chloride levels in ambient air greater than 100 times the state air quality standard.
    * Independent studies confirmed groundwater is threatened by liquid toxic leachate, and there are contaminated fish, vegetables, and fruit in the area
    * Studies in 1998 and 2001 by the U.S. Agency for Toxic Substances and Disease Registry (ATSDR) found alarming results — residents had more than three times the national average of dioxins in their blood, elevated dioxins in breast milk, and high cancer mortality rates.

More recently a few years ago, MEAN compiled data from the USEPA and ATSDR and found 77% of the mixture of dioxin compounds released by the Georgia Gulf PVC plant were the same dioxin compounds that made up 77% of the dioxins detected in the blood of Mossville residents. This finding shows that residents are accumulating the same mixture of dioxin compounds being released from the Georgia Gulf PVC plant and this mixture includes the most toxic forms of dioxin

Mark your calendars! Wednesday June 2nd at 8pm  – Toxic Towns, USA

Mark your calendars for Wednesday June 2nd  at 8:00pm EST to watch Dr. Sanjay Gupta’s Toxic Towns and stand in solidarity with the community of Mossville, and all communities impacted by the PVC chemical industry.

I’ll be there watching, will you?

Bad Karma in the Gulf of Mexico Oil Disaster

Posted by Phil Mattera on May 10th, 2010

Originally posted on May 7 at Dirt Digger's Digest.

http://dirtdiggersdigest.org/wordpress/wp-content/uploads/2010/05/deepwaterhorizon1.jpg

British Petroleum is, rightfully, taking a lot of grief for the massive oil spill in the Gulf of Mexico, but we should save some of our vituperation for Transocean Ltd., the company that leased the ill-fated Deepwater Horizon drilling rig to BP. Transocean is no innocent bystander in this matter. It presumably has some responsibility for the safety condition of the rig, which its employees helped operate (nine of them died in the April 20 explosion).

Transocean also brings some bad karma to the situation. The company, the world’s largest offshore drilling contractor, is the result of a long series of corporate mergers and acquisitions dating back decades. One of the firms that went into that mix was Sedco, which was founded in 1947 as Southeastern Drilling Company by Bill Clements, who would decades later become a conservative Republican governor of Texas.

In 1979 a Sedco rig in the Gulf of Mexico leased to a Mexican oil company experienced a blowout, resulting in what was at the time the worst oil spill the world had ever seen. As he surveyed the oil-fouled beaches of the Texas coast, Gov. Clements made the memorable remarks: “There’s no use in crying over spilled milk. Let’s don’t get excited about this thing” (Washington Post 9/11/1979).

At the time, Sedco was being run by Clements’s son, and the family controlled the company’s stock. The federal government sued Sedco over the spill, claiming that the rig was unseaworthy and its crew was not properly trained. The feds sought about $12 million in damages, but Sedco drove a hard bargain and got away with paying the government only $2 million. It paid about the same amount to settle lawsuits filed by fishermen, resorts and other Gulf businesses. Sedco was sold in 1984 to oil services giant Schlumberger, which transferred its offshore drilling operations to what was then known as Transocean Offshore in 1999.

In 2000 an eight-ton anchor that accidentally fell from a Transocean rig in the Gulf of Mexico ruptured an underwater pipeline, causing a spill of nearly 100,000 gallons of oil. In 2003 a fire broke out on a company rig off the Texas coast, killing one worker and injuring several others. As has been reported in recent days, a series of fatal accidents at company operations last year prompted the company to cancel executive bonuses.  It’s also come out that in 2005 a Transocean rig in the North Sea had been cited by the UK’s Health and Safety Executive for a problem similar to what apparently caused the Gulf accident.

Safety is not the only blemish on Transocean’s record. It is one of those companies that engaged in what is euphemistically called corporate inversion—moving one’s legal headquarters overseas to avoid U.S. taxes. Transocean first moved its registration to the Cayman Islands in 1999 and then to Switzerland in 2008. It kept its physical headquarters in Houston, though last year it moved some of its top officers to Switzerland to be able to claim that its principal executive offices were there.

In addition to skirting U.S. taxes, Transocean has allegedly tried to avoid paying its fair share in several countries where its subsidiaries operate. The company’s 10-K annual report admits that it has been assessed additional amounts by tax authorities in Brazil and that it is the subject of civil and criminal tax investigations in Norway.

In 2007 there were reports that Transocean was among a group of oil services firms being investigated for violations of the Foreign Corrupt Practices Act in connection with alleged payoffs to customs officials in Nigeria. No charges have been filed.

An army of lawyers will be arguing over the relative responsibility of the various parties in the Gulf spill for a long time to come. But one thing is clear: Transocean, like BP, brought a dubious legacy to this tragic situation.




Oil spill changes everything

Posted by Michael Brune on May 2nd, 2010

Originally posted on CNN.com on May 1.

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Michael Brune

Editor's note: Michael Brune is executive director of the Sierra Club and former director of the Rainforest Action Network.

The oil disaster plaguing the Gulf of Mexico and our coastal states puts our desperate need for a new clean energy economy in stark relief. We need to move away from dirty, dangerous and deadly energy sources.

We are pleased that the White House is now saying it will suspend any new offshore drilling while the explosion and spill are investigated, but there should be no doubt left that drilling will only harm our coasts and the people who live there.

Taking a temporary break from offshore drilling is an important step, but it's not enough. We need to stop new offshore drilling for good, now. And then we need an aggressive plan to wean America from dirty fossil fuels in the next two decades.

This BP offshore rig that exploded was supposed to be state-of-the-art. We've also been assured again and again that the hundreds of offshore drilling rigs along our beaches are completely safe. Now, we've seen workers tragically killed. We've seen our ocean lit on fire, and now we're watching hundreds of thousands of gallons of toxic oil seep toward wetlands and wildlife habitat.

This rig's well is leaking 210,000 gallons of crude every day, wiping out aquatic life and smothering the coastal wetlands of Louisiana and Mississippi. As the reeking slick spreads over thousands of square miles of ocean, it rapidly approaches the title of worst environmental disaster in U.S. history, even worse than 1989's Exxon Valdez oil spill. The well is under 5,000 feet of water, and it could take weeks or even months to cap it.

This disaster could unfortunately happen at any one of the hundreds of drilling platforms off our coasts, at any moment. It could happen at the drilling sites that the oil industry has proposed opening along the beaches of the Atlantic Coast.

Indeed, even before this spill, the oil and gas industry had torn apart the coastal wetlands of the Louisiana Bayou over the years. These drilling operations have caused Louisiana to lose 25 square miles of coastal wetlands, which are natural storm barriers, each year.

Another view: Why it won't be easy to replace fossil fuels

And it's hardly just the environmental costs of oil spills that we have to worry about with offshore drilling. The threat to the people who work on these platforms has again become terribly clear. In fact, more than 500 fires on oil platforms in the Gulf have injured or killed dozens of workers in just the past four years, according to the federal Minerals Management Service.

We don't need to pay this price for energy. We have plenty of clean energy solutions in place that will end our dependence on dirty fossil fuels, create good, safe jobs and breathe new life into our economy.

One huge example came Thursday, when the Obama administration approved our country's first offshore wind farm.

Our country has huge solar power potential as well. We can also save more oil through simple efficiency measures than could be recovered by new drilling on our coastlines.

This oil spill changes everything. We have hit rock-bottom in our fossil fuel addiction. This tragedy should be a wake-up call. It's time to take offshore drilling off the table for good.

The opinions expressed in this commentary are solely those of Michael Brune.




Banana Land and the Corporate Death Squad Scandals

Posted by Charlie Cray on February 25th, 2010

American based food companies are facing a spate of lawsuits charging that they have cooperated with and paid off groups officially designated as terrorists by the U.S. government.

In February, a federal judge refused to dismiss a civil suit filed against Chiquita, a global corporation that markets itself for “products and services [that] are designed to win the hearts and smiles of the world's consumers.”
 [http://www.chiquitabrands.com/CompanyInfo/CompanyInfo.aspx] The suit makes the less cheerful charge that the company paid “protection” money to leftist (FARC) guerrillas operating near its plantations in Colombia -- during a period when the FARC killed four American missionaries.

Families of the missionaries who are bringing this case (Julin et al. v. Chiquita Brands Int’l) to Federal District Court for the Southern District of Florida are suing Chiquita under the civil provisions of the Anti-Terrorism Act of 1991, which allows American citizens and their heirs to be compensated for injuries resulting from international terrorism.

This is not the first time that Chiquita has faced charges of complicity with “terrorists.” In March 2007, (US v. Chiquita Brands Intl) the company had pled guilty to violating U.S. antiterrorism laws by funding the right-wing paramilitary United Self-Defense Forces of Columbia (“AUC”). In the U.S. Department of Justice’s Factual Proffer to the Court in conjunction with Chiquita’s plea agreement in the 2007 case, the Justice Department stated that it could prove Chiquita made similar payments to FARC from 1989 through 1997. Both FARC and the AUC have been officially designated by the State Dept. as “Foreign Terrorist Organizations.”

Meanwhile, Dole is facing similar charges. The families of former plantation workers and land squatters are suing the world's largest producer and marketer of fresh fruit and vegetables in the Los Angeles Superior Court of California. The plaintiffs' complaint in Juana Perez 1-51/Juan Perez 5e-50 V. Dole Food Company, Inc., details a horrific litany of summary executions, off-the-bus abductions, forced-entry murders, kidnappings, ghoulish disappearances, and other crimes committed against trade unionists and land reform activists between 1997 and 2008 – the period when Dole, like Chiquita, allegedly supported the paramilitary AUC.

While Dole has denied making payments, Chiquita has taken a different route, voluntarily telling the Department of Justice about the payments. Its consistent position has been that both the left-wing guerrillas and right-wing paramilitaries extorted cash "to protect the lives of its employees." http://dolecsr.com/PressSection/PressReleases/April292009/tabid/5853/Default.aspx

Both positions have become increasingly untenable now that paramilitaries who took the payments have come in from the cold. In exchange for disarming, submitting to Colombia's "Justice and Peace" process, and confessing to all their crimes, the former combatants have been promised reduced jail time.

Dole’s denial of pay offs is contradicted by sworn affidavits filed in the ongoing litigation. Jose Gregorio Mangones Lugo (aka "Carlos Tijeras") was the former commander of the William Rivas Front of the AUC group that operated in northern Colombia, in the zone where the companies and their suppliers grew bananas. In a sworn statement, Tijeras described the AUC's relationship with the head of plantations controlled or owned by both Dole and Chiquita as "an open public relationship" involving everything from "security services" to the kidnapping and extrajudicial assassination of labor leaders fingered by the companies as "security problems."

Tijeras' statement–which reads like the confessions of a corporate death squad leader and directly refutes his paymasters' version of events – was entered into the record in the California case  (Juana Perez 1-51/Juan Perez 5e-50 V. Dole Food Company, Inc), filed against Dole in April 2009 by attorneys with Conrad and Scherer, representing the families of the 73 people killed by the AUC.

“I've been told that Chiquita has asserted that they paid the AUC funds, but that this was coerced and was a form of extortion,” Tijeras states. “I have also heard that Dole claims to have never paid us any funds. Both of these assertions are absolutely false. In fact, my agreement with Chiquita and Dole was to provide them with total security and other services.”

“These terrorists have every reason to lie by making false allegations against international companies like Dole in order to minimize their own culpability and reduce their jail time,” said C. Michael Carter, Dole's Executive Vice President and General Counsel.  "This lawsuit is irresponsible and the allegations are blatantly false."

Tijeras is not the only paramilitary to put some of the blame on the companies. Salvatore Mancuso, the overall commander of the AUC, also testified in early 2008 that Dole and Del Monte, like Chiquita, had been providing major support to the AUC since its inception. He repeated the accusation to 60 Minutes, which originally aired the segment in September 2008.

According to these and other witnesses, as well as investigators familiar with the bloody history of Colombia, the companies originally hired the AUC to drive the leftist FARC guerillas out of the banana-growing region and protect their plantations from, as Tijeras put it, "the gangs of common delinquents that robbed their supplies and equipment." Once the FARC was vanquished and order restored, the banana companies continued to pay the AUC to "pacify" their work forces, suppress the labor unions, and terrorize peasant squatters perusing competing land claims.

Tijeras:
After we restored order and became the local agents of law enforcement, managers for Chiquita and Dole plantations relied upon us to respond to their complaints. ...We would also get calls from the Chiquita and Dole plantations identifying specific people as "security problems" or just "problems." Everyone knew that this meant we were to execute the identified person. In most cases those executed were union leaders or members or individuals seeking to hold or reclaim land that Dole or Chiquita wanted for banana cultivation, and the Dole or Chiquita administrators would report to the AUC that these individuals were suspected guerillas or criminals.

According to Tijeras, for years the companies provided up to 90 percent of the AUC's income.

When the families and heirs of dozens of victims filed the case against Dole in April 2009, the company immediately rejected the charges as "baseless allegations" that "are the product of the most untrustworthy sources imaginable" and "nothing more than the false confessions of convicted terrorists from Colombia, who had every motive to lie about their activities in order to minimize their jail time."

Dole’s use of the term “terrorist” to refer to the AUC accurately reflects the official U.S. State Department categorization of the group assigned (coincidentally) on September 10, 2001. That designation carries legal consequences for both Dole (if evidence of the payments is proven) and Chiquita: First, the Anti-Terrorism Act of 1991 allows U.S. citizens and their heirs to sue over injuries from international terrorism; and second, payments to designated terrorists are illegal even if coerced -- and whether or not the company is cognizant of or indifferent to the consequences.

The ongoing case against Chiquita in Florida is strengthened by the company’s March 2007 guilty plea in U.S. v. Chiquita Brands International, Inc., by its voluntarily disclosure of payments, and by its agreement to pay a $25 million criminal fine for violating U.S. antiterrorism laws. The 2007 Chiquita criminal case was remarkable for numerous revelations, not least that the company continued to make the payments against the advice of its own outside counsel, and even after notifying the Justice Department.

As part of that settlement, Chiquita acknowledged that it had also made payments to the FARC from 1989 to at least 1997 -- a period, according to relatives, when the guerrilla group abducted and killed the missionaries.

Pattern of Complicity with Terror
It has been almost 3 years since Rep. William Delahunt (D-MA), chair of the House Subcommittee on International Organizations, Human Rights, and Oversight, launched an investigation into U.S. multinationals' complicity with human rights violations in Colombia. At a June 2007 hearing, witnesses testified that there was a pattern of complicity between Colombian terrorists and multinational corporations  -- including the Alabama-based Drummond Co. Inc., which allegedly paid members of a Colombian terrorist group to kill three union organizers. The Miami Herald reported just days before the hearing that paramilitaries had also come forward to talk in detail about payments Drummond made to the paramilitaries.

Drummond denies all allegations against the company and its employees made by attorneys working for relatives of murdered Drummond employees.

Other companies with operations in Colombia that were mentioned at Delahunt's hearing include Occidental, Coca-Cola and ExxonMobil.
An "independent" review commissioned by the company's board reinforced Chiquita's claim that its sole motivation in making payments to both the FARC and the AUC was to protect the lives of its employees.

That report may help deflect derivative lawsuits filed by the company's own shareholders, but is greeted with skepticism in Colombia, where Attorney General Mario Iguaran roundly rejected Chiquita's explanation, and reportedly threatened to extradite as many as eight Chiquita executives (including John Paul Olivo, Charles Dennis Keiser, and Dorn Robert Wenninger) who, he says, were responsible for approving the payments and maintaining a "criminal relationship" with the paramilitaries.

Another remarkable aspect of the Chiquita case is the fact that the lead attorney representing Chiquita Brands International is now the U.S. attorney general.

In August 2007, when he was still representing Chiquita, Eric Holder told the Washington Post that it would be unfair to treat "harshly" any company that voluntarily discloses payments to designated terrorists, and that even if the company was penalized, the individuals within the firm should not be. Yet just a few years before he first passed through the revolving door, U.S. Deputy Attorney General Holder authored the "Holder Memo," a famous corporate crime policy memo asserting that the "prosecution of a corporation is not a substitute for the prosecution of criminally culpable individuals within or without the corporation."

Jason Glaser, a documentary filmmaker who helped launch the Banana Land Campaign in December, says that Attorney General Holder has a clear conflict of interest and should recuse himself from any decision concerning the requested extradition of Chiquita executives or any other matter related to the investigation of multinational complicity in violence in Colombia.

“Holder is the nation's top cop, overseeing a department that regularly claims that fighting terrorism is a top priority,” Glaser points out. “If that’s true, then it's worth asking where’s the Department's investigation of Dole, which, unlike Chiquita won't volunteer any facts, and patently deny any allegations - when there is so much obvious evidence pointing their way?”

To learn more about the situation in Colombia and other countries check out The Banana Land Campaign and International Rights Advocates.

Inspector General reports confirm CorpWatch story on Afghan power plant

Posted by Pratap Chatterjee on February 9th, 2010

Three independent investigations have confirmed a CorpWatch investigation into a $305 million USAID project to build a diesel-fueled power plant in Kabul (see the original article here: "Black & Veatch's Tarakhil Power Plant: White Elephant in Kabul").

I've written an updated news story that is available from Inter Press Service.

Two of the independent investigations were published in mid-January by the Special Inspector General for Afghanistan Reconstruction. You can also download the reports from CorpWatch's website -- the first examines the Tarakhil plant and the second one examines the broader problems for the Afghan electricity sector. A third report on the failures of USAID projects in the Afghan electricity sector was published earlier by the USAID Inspector General, and comes to the same conclusions.

Notably the three reports do not address the issue of nepotism within the Afghan government. For more on how the family of the vice-president of Afghanistan profited from the electricity sector project, see this story: "Paying Off the Warlords."

Following up on our August 2009 feature, Jack Currie, the project manager for Black & Veatch's Tarakhil power plant, wrote CorpWatch in November to say that he was not dismissed from the Qudas project in Iraq but "left after my stint was complete due to family matters, pressures of being in a war zone."

He also added that the commissioning and operation of the Qudas plant in Iraq was 'challenged' because it did not have the correct quality fuel available to run the new engines, the new engines were designed to run on naptha, which was not available at the time, and the crude oil used caused significant problems. Black & Veatch was asked to start up engines that were installed by the Iraqis -- and despite having no drawings or manuals managed to get them up and running.

Global Compact participant wins Survival Greenwashing Award 2010

Posted by on February 8th, 2010

Yaguarete Porá, a Global Compact participant from Brazil, has won Survival’s Greenwashing Award 2010. Survival is an international organization that supports tribal peoples worldwide.

Yaguarete has won the award for "dressing up the wholesale destruction of a huge area of the Indians' forest as a noble gesture for conservation", says Survival's director Stephen Corry.

The company owns 78,549 hectares of forest that is part of the Ayoreo-Totobiegosode tribe's ancestral territory. After satellite photos were published around the world revealing that it has destroyed thousands of hectares of the tribe's forest, the company issued a press release announcing it intends to create a "nature reserve"on its land.

But plans submitted by Yaguarete to Paraguay’s Environment Ministry reveal that the amount of "continuous forest" in the reserve will be just 16,784 hectares out of the 78,549 hectares total, and the company in fact plans to convert around two thirds of the land to cattle ranching.

Some of the Totobiegosode have already been contacted and vehemently condemned the plans for the 'reserve', pointing out that it violates their rights under both Paraguayan and international law. The contacted Totobiegosode have been claiming legal title to this land since 1993, but most of it is still in private hands.

The Totobiegosode are the only uncontacted Indians in the world having their territory destroyed for beef production.

Survival director, Stephen Corry, said that "This is textbook 'greenwashing': bulldoze the forest and then 'preserve' a bit of it for PR purposes. The public won't fall for it. Yaguarete should stop playing games and pull out of the Totobiegosode's territory once and for all."

This video outlines Yaguarete's plans:

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*Originally posted on February 1 at Global Compact Critics.




A Corporate Full-Body Scan

Posted by Philip Mattera on February 2nd, 2010

Originally posted on January 28 at Dirt Diggers Digest.

The one redeeming feature of the abominable Supreme Court ruling on corporate electoral expenditures is the majority’s retention of the rules on disclaimers and disclosure. While opening the floodgates to unlimited business political spending, the Court at least recognizes that the public has a right to know when a corporation is responsible for a particular message and a right to information on a corporation’s overall spending.

Writing for the majority, Justice Kennedy states: “The First Amendment protects political speech; and disclosure permits citizens and shareholders to react to the speech of corporate entities in a proper way. This transparency enables the electorate to make informed decisions and give proper weight to different speakers and messages.”

There’s no question that steps must be taken to mitigate the Citizens United ruling, whether through changes in corporation law, shareholder pressure, enhanced public financing of elections, or even a Constitutional amendment.

Yet while these efforts progress, it is also worth taking advantage of the Court’s affirmation of the principle of transparency and push for even greater disclosure than what we have now. Groups such as the Sunlight Foundation are already moving in this direction.

The effort could begin with pressing the Federal Election Commission to tighten the existing reporting rules on what are known as “electioneering communications” and to enforce them more diligently.  But that’s not enough.

In the wake of Citizens United, we’ve got to demand more information on the many ways corporations exercise undue influence not only on elections but also on legislation, policymaking and public discourse in general. Now that Big Business is a much bigger threat to popular democracy, we have to subject corporations to intensive full-body scans to find all their hidden weapons of persuasion. The following are some of the areas to consider.

Lobbying. In his State of the Union Address, President Obama said that lobbyists should be required to disclose every contact with the executive branch or Congress. That’s fine, but why stop there? Many corporations do their lobbying indirectly, through trade associations which disclose little about their sources of funding. How about rules that require those associations to disclose the fees paid by each of their members and require publicly traded companies to disclose exactly how much they pay to belong to each of their various associations?

Front Groups. Corporations also indirectly seek to influence legislation and public opinion by bankrolling purportedly independent non-profit advocacy groups. Such front groups—such as those taking money from fossil-fuel energy producers to deny the reality of the climate crisis—do not have to publicly disclose their contributor lists. Why not require publicly traded companies, at least, to reveal all of their payments to such organizations?

Union-Busting. Encouragement of collective bargaining is still, in theory, official federal policy. Yet many companies violate the principle—and the rights of their workers—by using corporate funds to undermine union organizing campaigns. The existing rules on the disclosure of expenditures on anti-union “consultants” are too narrow and not vigorously enforced. That should change.

These are only a few of the ways that undue political influence and other forms of anti-social corporate behavior could be addressed through better disclosure. Yet, as we’ve seen, transparency by itself does not counteract corporate power unless something is done with the information.

This came to mind in reading the last portion of the Citizens United ruling. Not all five Justices in the majority went along with the idea of maintaining the disclaimer and disclosure rules. Parting with Kennedy, Roberts, Scalia and Alito, Justice Thomas argued not only that corporate independent expenditures should be unrestricted, but also that they should be allowed to take place under a veil of secrecy.

He bases his argument not on legal precedent, but rather on dubious anecdotal evidence that some supporters of California’s anti-gay-marriage Proposition 8 were subjected to threats of violence after their names appeared on public donor lists. Thomas thus suggests that corporations should be able to make their political expenditures anonymously to avoid retaliation.

While I am in no way advocating violence, I think activists need to use the information that becomes public as the result of expanded disclosure to make corporations pay a price for any attempts to buy our political system. If we can get them to worry about (non-violent) retaliation to the point that they limit their expenditures, then we will have gone a long way toward neutralizing the pernicious effects of the Citizens United ruling.




Pecora Weeps

Posted by Philip Mattera on January 16th, 2010

Originally posted on January 15 at Dirt Diggers Digest.

After J.P. Morgan was questioned by Congressional investigator Ferdinand Pecora during a 1930s investigation of the causes of the Great Crash, the legendary financier complained that Pecora (photo) had “the manners of a prosecuting attorney who is trying to convict a horse thief.” Morgan was also embarrassed when a Ringling Bros. publicity agent placed a diminutive circus performer on his lap in the middle of the proceedings.

At this week’s public hearing of the Financial Crisis Inquiry Commission, the nation’s most powerful bankers were, unfortunately, treated with a lot more deference. Sure, there was one satisfying exchange between FCIC Chairman Phil Angelides and Goldman Sachs CEO Lloyd Blankfein in which Angelides likened the firm’s practice of betting against the very securities it was peddling to clients to that of selling someone a car with faulty brakes and then buying an insurance policy on the buyer.

But those moments were rare. For the most part, the bankers came away unscathed. Most of the ten commissioners treated them not as suspected criminals whose misdeeds needed to be probed, but rather as experts whose opinions on the causes of the crisis were being solicited. This gave the bankers abundant opportunities to pontificate about industry and regulatory practices while avoiding any incriminating admissions about their own firm’s behavior.

For example, Commissioner Heather Murren, CEO of the Nevada Cancer Institute, asked Blankfein whether there should be “more supervision of the kinds of activities that are undertaken by investment banks?” This allowed him to babble on about the “sociology…of our regulation before and after becoming a bank holding company.”

The bankers seemed to have expected tougher questioning. Their opening statements sought to soften the interrogation by conceding some general culpability, though it was done in a mostly generic way. Jamie Dimon of JP Morgan Chase admitted that “new and poorly underwritten mortgage products helped fuel housing price appreciation, excessive speculation and core higher credit losses.” John Mack of Morgan Stanley acknowledged that “there is no doubt that we as an industry made mistakes.” And Brian Moynihan, the new CEO of Bank of America, noted: “Over the course of the crisis, we, as an industry, caused a lot of damage.”

But much too little time was spent by the commissioners exploring how the giant firms represented on the panel contributed to that damage. A search of the transcript of the hearing produced by CQ Transcriptions and posted on the database service Factiva indicates that the word “predatory” was not used once during the time the four top bankers were testifying.

The commissioners failed to challenge most of the self-serving statements made by the bankers to give the impression that, despite whatever vague transgressions were going on in the industry, their own firms were squeaky clean. Even Angelides failed to pin them down. When he asked Blankfein to state “the two most significant instances of negligent, improper and bad behavior in which your firm engaged and for which you would apologize” the Goldman CEO admitted only to contributing to “elements of froth in the market.” Angelides asked whether that included anything “negligent or improper.” Blankfein again evaded the question and the Chairman gave up.

The bankers also went unchallenged in making statements that were incomplete if not outright erroneous. When Blankfein, for example, claimed that Goldman deals only with institutional investors and “high-net-worth individuals,” no one pointed out the firm’s ties to Litton Loan Servicing, which has handled large numbers of subprime and often predatory home mortgages.

The Goldman chief also made much of the fact that he and other top executives of the firm took no bonuses in 2008. That’s true, but he failed to mention that, according to Goldman’s proxy statement, he alone became more than $25 million richer that year when previously granted stock awards vested.

The bankers were at their slipperiest when it came to the few questions about the issue of being too big to fail. They would not, of course, admit to being too big, but in spite of every indication that the federal government would never allow another Lehman Brothers-type collapse to occur, they labored mightily to argue that they could conceivably go under. This notwithstanding the fact that a couple of them had just thanked U.S. taxpayers for the financial assistance their firms had received.

I suppose it’s possible that the Commission is saving its best shots for later stages of the investigation and its final report, but its handling of the banker hearing deprived the public of a chance to see some of the prime villains of the current crisis get a much-deserved tongue-lashing.




25 Years and Still Fighting for Justice: When Will Dow Chemical Clean Up Its Poisonous Legacy in Bhopal

Posted by Tonya Hennessey on December 14th, 2009
TakePart.com

Originally posted on TakePart.com, Participant Media's Social Action site.

Even now, after 17 years of working in the international NGO arena, fighting for environmental and human rights, and social justice, I am still taken aback by multinational corporations and the disproportionate power and influence these entities have amassed on the global stage. Don’t get me wrong: commerce and markets are as old as humankind, so it’s not about that.

But who holds multinational corporations accountable when things go wrong--especially overseas--and how? And what happens when one company buys another, one that is holding significant public liability? Doesn’t the liability go along with the purchase?

Take Dow Chemical, ranked #127 on the 2009 Global 500 List, and 2nd within the global chemical industry, with profits of $579 million. In 2001, Dow fully acquired Union Carbide Corporation. (See CorpWatch's Crocodyl.org wiki profile on Dow Chemical)

On the night of December 2-3, 1984, Union Carbide’s pesticide factory in Bhopal, India, leaked a deadly cloud of methyl iso cyanate gas that floated out into the surrounding area. 8,000 people lost their lives in the immediate aftermath of that terrifying night. According to Bhopal Medical Appeal, at least 25,000 people have died in total as a result of the tragedy.

Last week was the 25th Anniversary of this man-made disaster. And Dow Chemical has yet to clean up the contaminated site. The International Campaign for Justice in Bhopal estimates 100,000 more people--now including 2nd generation impacted children--are still suffering. Deformities, disabilities, miscarriages and other illnesses such as chronic respiratory problems are among the maladies documented.

Last week the group I direct, CorpWatch, published a new feature story by veteran activist and journalist Nityanand Jayaraman, “Bhopal: Generations of Poison.” In the article you’ll find a lot of historical detail, as well as findings from two new independent studies, released on December 1, showing continued high levels of contaminants in and around the factory site. See The Bhopal Medical Appeal’s “BMA Sambhavna Bhopal Water Report,” and The Centre for Science and Environment’s “Continuing nightmare in Bhopal: CSE laboratory tests soil, water samples from Union Carbide.”

I was hoping to get this blog post up last week, too, so as not to be late in honoring the survivors and the victims on this awful anniversary. Pesky deadlines and the unanticipated prevented me from doing so before I caught my flight on Thursday to Amsterdam, on my way to the climate talks now beginning in Copenhagen, Denmark. “Damn,” I thought, “I’ve missed the anniversary window, and now my blog would be late.”

Then it hit me. Wait a minute…talk about late! Twenty-five years is a long time to wait for Dow and Union Carbide to right this devastating wrong, and it’s even longer when the tragedy keeps on giving. Because site contamination has still not been adequately contained, nor cleaned up, the poisons continue to pollute the groundwater that more than 30,000 people rely on for drinking water.

Again, how is it that a corporation gets away with this? Countries have been invaded over lower numbers of victims (no number is a good number here), and if a non-state actor released a cloud of noxious gas that killed 8,000 pretty much off the bat, wouldn’t that be considered an act of terrorism? Or at the least, egregious criminal wrong-doing? Wouldn’t the clamor be deafening to hold to account those responsible?

Instead, Dow has launched a Corporate Social Responsibility Campaign--Dow’s Global Water Initiatives, which doesn’t have a project in Bhopal--in a classic greenwash of its public image.

Despite all this, Bhopali survivors are not giving up their struggle for justice. Take a look at this inspiring photo gallery of the rally they held last week on December 3rd.

December is also the first anniversary of Children Against Dow-Carbide, an association of about 60 youngsters. As 17-year old Safreen Khan, one of the co-founders of the youth group interviewed in our article, puts it, “The Bhopal struggle is not 25 years old. With our entry, the struggle has just entered its youthful phase, and we'll keep the fight alive for as long as it takes.”

What can you do to TakePart?

Inform yourself about what happened in Bhopal in 1984 through the International Campaign for Justice in Bhopal, and about the chemical industry, its impacts, and alternatives.

Read about and help investigate corporate practices on CorpWatch's Crocodyl.org website--Collaborative Research On Corporations.

And join Students for Bhopal in their campaign to Dump Your Dow, until Dow steps up to account.

Chevron Gets Fixed

Posted by Antonia Juhasz on November 4th, 2009
Huffington Post

Originally published on 3 November 2009.

On Sunday, Chevron became the first oil company to come under a Yes Men Audience Attack.

(See Video, Photos, and Yes Man Andy Bichlbaum's Blog of event)

Chevron was chosen because Chevron is different from other oil companies.

It is bigger than all but three (only ExxonMobil, BP and Shell are larger). It is facing the largest potential corporate liability in history ($27 billion) for causing the world's largest oil spill in the Ecuadorian rainforest. It is the only major U.S. Corporation still operating in Burma and, with its partner Total Oil Corp., is the single largest financial contributor to the Burmese government. It is the dominant private oil producer in both Angola and Kazakhstan, with operations in both countries mired in human rights and environmental abuses. It is the only major oil company to be tried in a U.S. court on charges of mass human rights abuse, including summary execution and torture (for its operations in Nigeria).

It is the only oil company to hire one of the Bush Administration's "torture memo" lawyers (William J. Haynes). It is the largest and most powerful corporation in California, where it is currently being sued for conspiring to fix gasoline prices. It has led the fight to keep California as the only major oil producing state that does not tax oil when it is pumped from the ground, thereby denying the state an extra $1.5 billion annually. It is the largest industrial polluter in the Bay Area and is among the largest single corporate contributors to climate change on the planet.

Chevron is also the focus of one of the world's most unique and well-organized corporate resistance campaigns.

That campaign got a jolt of energy when Yes Man Andy Bichlbaum came to San Francisco on Halloween weekend for a special screening of The Yes Men Fix the World.

Global Exchange and I teamed up with Andy (the movie's co-writer, director, and producer) and a host of the Bay Areas most creative activists, to lead an entire movie audience out of the theater, into the streets, and in protest of Chevron.

We spread the word early, far, and wide: The Yes Men are coming! The Yes Men are coming! They will not only fix the world, they will fix Chevron too!

Larry Bogad, a Yes Man co-hort and professor of Guerilla Theater, helped concoct a masterful street theater scenario. A crack team of protest and street theater organizers was compiled, including David Solnit of the Mobilization for Climate Justice and Rae Abileah of Code Pink. Rock The Bike signed on and the word kept spreading.

On Sunday, the Roxie Theater in San Francisco's Mission District was filled beyond capacity with an audience that came ready to protest. They laughed, clapped, booed, and cheered along with the film. When the movie ended, Andy answered questions, I talked about Chevron, and Larry laid out the protest scenario.

Three Chevron executives, protected from the early ravages of climate change in SurvivaBalls, were dragged up the street by dozens of Chevron minions with nothing but haz-mat suits to protect them. Those unable to afford any protection (i.e. The Dead) followed close behind. Next came resistance: the Chevron street sweepers, actively cleaning up Chevron's messes who were followed by the protesters, ready to change the story.

We didn't have a permit, but we took a lane of traffic on 16th street anyway. The police first tried to intervene, then they "joined in," blocking traffic on our way to Market and Castro.

As we marched and the music blared, people literally came out of their houses and off of the streets to join in. Passersby eagerly took postcards detailing Chevron's corporate crimes.

Once we arrived at the gas station, I welcomed everyone and explained that we were at an independent Chevron (as opposed to corporate) station, whose owner (whom I'd been speaking with regularly) had his own list of grievances with his corporate boss. The particular station was not our target of protest, but rather, the Chevron Corporation itself.

Larry and Andy than led the entire crowd in a series of Tableaux Morts. The Chevron executives in their SurvivaBalls drained the lifeblood from the masses. The people began to rebel, forcing the SurvivaBalls into the "turtle" position to fend off the attacks. Ultimately, the separate groups saw their common purpose in resisting Chevron's abuses. The dead rose, the Chevron minions rebelled, and the sweepers and protesters joined together. They all chased the Chevron executives off into the distance, and then danced in the streets, rejoicing in their shared victory!

The Chevron Program I direct at Global Exchange seeks to unite Chevron affected communities across the United States and around the world. By uniting these communities, we build strength from each other, and become a movement. By expanding, strengthening, and highlighting this movement, we bring in more allies and create a powerful advocacy base for real policy change. Those changes will reign in Chevron, and by extension, the entire oil industry. And, by raising the voices of those hardest hit by the true cost of oil and exposing how we all ultimately pay the price, we help move the world more rapidly away from oil as an energy resource altogether.




Berkeley, Oakland urge oil money transparency

Posted by Josh Richman on October 20th, 2009

Originally posted, October 14, 2009 on http://www.ibabuzz.com/politics/2009/10/14/berkeley-oakland-urge-oil-money-transparency/

Berkeley City Council last night approved a resolution urging the U.S. Senate to approve S.1700, the “Energy Security Through Transparency Act” by U.S. Sen. Richard Lugar, R-Ind., which would urge the Obama Administration to require that companies disclose payments to foreign governments for oil, gas and mineral rights. Oakland City Council passed a similar resolution last week.

“Good governance in extractive industries contribute to a better domestic investment climate for U.S. businesses, increase the reliability of commodity supplies, promote greater U.S. energy security and thereby strengthen our national security,” says the summary on Lugar’s Web site.

San Francisco-based Justice in Nigeria Now hails the cities’ actions as a moral victory.

“I was tortured and imprisoned by the Nigerian military for my peaceful protests against Shell Oil’s destruction of our land,” Suanu Kingston Bere, a Nigerian activist who spoke at the Berkeley City Council meeting, said in JINN’s news release. “I believe the City’s support sends a strong message that communities in the U.S are concerned about the human rights abuses and environmental damage associated with oil extraction. I do not want to see my people continue to go through what I went through.”

Berkeley’s resolution also calls on the State Department to support third-party peace talks in the Delta to address environmental destruction and lack of investment in the oil producing region. The resolution was co-sponsored by Councilmembers Jesse Arreguin, Darryl Moore and Max Anderson and was introduced to the council through the Berkeley Peace and Justice Commission, which worked with JINN to draft it.

JINN says 50 years of oil exploitation in the Niger Delta has produced over $700 billion in oil revenues shared between the Nigerian government and oil giants like San Ramon-based Chevron as well as Exxon Mobil and Shell. More than 40 percent of Nigeria’s oil is exported to the U.S. Yet despite the corporate oil wealth, local residents’ quality of life has deteriorated – their drinking polluted, their food fisheries poisoned, their access to education, health care and even electricity limited.

“Oil companies in Nigeria have had long a relationship with the notoriously corrupt and historically brutal Nigerian government where rampant corruption, fraudulent elections and violent suppression of peaceful protests are the norm in the Delta,” Nigerian writer and activist Omoyele Sowore said in JINN’s news release. “The proposed ESTT Act in the Senate is an important step toward holding oil companies accountable for their collusion with the Nigerian government, which protects their profits while killing and injuring innocent local people and destroying the Delta’s fragile environment.”

Still Learning Nothing

Posted by Mark Floegel on September 24th, 2009

Originally posted at http://markfloegel.org/

The best time to announce the worst news is late on Friday. The federal government and public relations firms have known this for years. So it was that the National Marine Fisheries Service (NMFS) scheduled its press conference last Friday for 3 p.m., Pacific Daylight Time or (even better!) 6 p.m. in the east.

As planned, the news that stocks of Bering Sea pollock – America’s largest fishery – have declined to a 30-year-low was reported only in the fishing trade press and the Seattle and Anchorage papers. Mission accomplished.

Every summer, NMFS technicians survey pollock. The amount of fish allowed to be caught in 2009 was based on the 2008 summer survey. The 2010 quota will be based on the 2009 survey and so on. On one hand, these surveys are about “environmental protection.” (Alas, we must us the dreaded quotation marks, because the environment has not been protected.) On the other hand, the surveys are a government-subsidized service for the industrial trawler fleet that pulls the pollock from the sea.

On the other, other hand (we’re playing three hands today), most people don’t know what a pollock is, but we eat enough of it. (As I mentioned two paragraphs ago, it’s America’s largest fishery.) All that imitation crabmeat in the supermarket wet case? Pollock. (And why must pollock imitate crabmeat? American fisheries management.)

Pollock is the whitefish in all those disgusting frozen fish sticks. Pollock is, or was, the fish in the sandwiches at the fast food restaurants. Now that pollock is in severe decline, McDonald’s is considering switching to hoki. This has nothing to do with environmental awareness; McDonald’s requires a steady supply of a consistent product at a predictable price. Hoki, a whitefish that’s overfished by industrial trawlers in New Zealand waters, will be a temporary fix, a few years at best. Thanks, Ronald.

Where was I? Oh right, severe decline. Three years ago, NMFS allowed the trawlers to take 1.5 million metric tons of pollock out of the Bering Sea. This year, because the decline was already evident in last year’s survey, the quota was set at 815,000 metric tons. The industry trade press headlines news like this as: “Pollock prices likely to rise.”

The At-Sea Processors Association, the trade group that represents the industrial trawlers, will try to convince the feds to keep the quota high and if the past is any evidence, they’ll do it. That’s why the fish population is crashing. What’s worse, they may bully the feds into continuing the pollock roe season. Roe, of course, is fish talk for eggs. The trawlers deliberately target the pregnant females, strip the eggs out of their bellies and sell them for big bucks on the Asian market.

What the Epicureans of Korea and Japan eat for dinner is what doesn’t become a fish in the Bering Sea, with tragic consequences for the sea and the other animals that live there. Pollock have traditionally been mighty breeders, the rabbits of the northern seas (one reason we fish them so hard). As such, they’ve provided much of the food for the rest of the animals in the ocean, like Steller sea lions and Pribilof fur seals. Because we humans got greedy with the trawlers and the roe, now those species (and more) are in trouble.

Yes, eating the eggs is a great way to deplete a population of fish (or any other wild creature) and yes, there’s more to it than that. Global warming plays a role, with warm water moving north into the Bering Sea, making conditions for pollock love less favorable than they’ve been in decades past. The pollock don’t cause global warming, though, nor do sea lions or fur seals. So yeah, we should stop burning so many fossil fuels, but until we do, we have to back off with the trawlers and give the pollock time to rebuild their numbers.

An irony here (not the irony, there’s too much irony for that) is that Bering Sea pollock are often referred to (by the industrial trawling people) as “the best-managed fishery in the world.” Sadder still is that the statement is not far from accurate. Look at Atlantic cod, that population crashed 15 years ago and has yet to come back.

And we learned nothing from it.

Tightening the Corporate Grip: The Stakes at the Supreme Court

Posted by Robert Weissman on September 18th, 2009

Originally posted on 9 September at http://www.commondreams.org/view/2009/09/09-11

Can things get still worse in Washington?

Yes, they can. And they will, if the Supreme Court decides for corporations and against real human beings and their democracy in a case the Court will be hearing today, Citizens United v. Federal Election Commission.

Until reaching the Supreme Court last year, this case has involved a narrow issue about whether an anti-Hillary Clinton movie made in the heat of the last presidential election is covered by restrictions in the McCain-Feingold campaign finance law. However, in a highly unusual move announced on the last day of the Supreme Court's 2008 term, the justices announced they wanted to reconsider two other pivotal decisions that limit the role of corporate money in politics.

The Court ordered a special oral argument on the issue, before the full start of their 2009 term in October.

The Court will today hear argument on whether prior decisions blocking corporations from spending their money on "independent expenditures" for electoral candidates should be overturned. "Independent expenditures" are funds spent without coordination with a candidate's campaign. The rationale for such a move would be that existing rules interfere with corporations' First Amendment rights to free speech.

Overturning the court's precedents on corporate election expenditures would be nothing short of a disaster. Corporations already dominate our political process -- through political action committees, fundraisers, high-paid lobbyists and personal contributions by corporate insiders, often bundled together to increase their impact, threats to move jobs abroad and more.

On the dominant issues of the day -- climate change, health care and financial regulation -- corporate interests are leveraging their political investments to sidetrack vital measures to protect the planet, expand health care coverage while controlling costs, and prevent future financial meltdowns.

The current system demands reform to limit corporate influence. Public funding of elections is the obvious and necessary (though very partial) first step.

Yet the Supreme Court may actually roll back the limits on corporate electoral spending now in place. These limits are very inadequate, but they do block unlimited spending from corporate treasuries to influence election outcomes. Rolling back those limits will unleash corporations to ramp up their spending still further, with a potentially decisive chilling effect on candidates critical of the Chamber of Commerce agenda.

The damage will be double, because a Court ruling on constitutional grounds would effectively overturn the laws in place in two dozen states similarly barring corporate expenditures on elections.

More than 100 years ago, reacting to what many now call the First Gilded Age, Congress acted to prohibit direct corporate donations to electoral candidates. Corporate expenditures in electoral races have been prohibited for more than 60 years.

These rules reflected the not-very-controversial observation that for-profit corporations have a unique ability to gather enormous funds and that expenditures from the corporate treasury are certain to undermine democracy - understood to mean rule by the people. Real human beings, not corporations.

In arguing to uphold the existing corporate expenditure restrictions, the Federal Election Commission has emphasized these common sense observations.

"For-profit corporations have attributes that no natural person shares," the FEC argues. Noting that corporations are state-created -- not natural entities -- the FEC explains that "for-profit corporations are inherently more likely than individuals to engage in electioneering behavior that poses a risk of actual or apparent corruption of office-holders." The FEC also notes that corporate spending on elections does not reflect the views of a company's owners (shareholders).

Although the signs aren't good, there is no certainty how the Court will decide Citizens United. There is some hope that the Court will decide that it is inappropriate to roll back such longstanding and important campaign finance rules, in a case where the issue was not presented in the lower courts, and where the litigants' dispute can be decided on much narrower grounds.

Public Citizen is organizing people to protest against a roll back of existing restrictions on corporate campaign expenditures. To join the effort, go to www.dontgetrolled.org. People are pledging to protest in diverse ways -- from street actions to letter writing -- today, and in the event of a bad decision, and also networking for solutions to corporate-corrupted elections.

Ours is a government of the people, by the people, for the people -- not the corporations and their money. Corporations don't vote, and they shouldn't be permitted to spend limitless amounts of money to influence election outcomes.

Robert Weissman is president of Public Citizen. Public Citizen attorney Scott Nelson serves as counsel to the original sponsors of the McCain-Feingold law, who have filed an amicus brief in the case, asking that existing restrictions on corporate election expenditures be maintained.

CorpWatch Bribery Report Helps Spark Dutch Inquiry

Posted by Anton Foek on August 20th, 2009

In July 2006, CorpWatch exposed evidence that a Dutch shipbuilding company, selling military equipment to Chile, was offering bribes to officials there. CorpWatch’s reporting is now fueling calls by anti-corruption activists and opposition politicians for a formal parliamentary investigation into the operations of the company, Rotterdamse Droogdok Maatschappij (RDM). 

The RDM case may become the first test for the Netherlands’ new anti-corruption legislation and for its will and ability to prosecute corporations for making foreign bribes.

The RDM bribery scandal dates back to 1998 when the company sold 202 Leopard tanks to the Chilean army. The Rotterdam-based company had purchased the tanks as scrap metal from the Dutch Department of Defense and rebuilt them. It then paid bribes to Chilean army officials facilitating the sale.

In early August this year, a high court in Santiago de Chile sentenced army General Luis Lobos and Brigadier General Gustavo La Torre to prison for accepting bribes of more than half a million dollars.

Joep van den Nieuwenhuyzen, the Dutch businessman, and officials of his company—who offered and facilitated the bribes—have never been prosecuted in relation to this case. The Dutch Public Prosecutor’s Office told CorpWatch that at the time of RDM’s bribes, the Netherlands had no laws against offering bribes to officials overseas. Legislation to make these practices illegal was introduced in 2001. Further muddying the waters, RDM went bankrupt in 2006, and Joep van den Nieuwenhuyzen, its owner, was jailed for fraud. He was released two years ago.

The current Dutch government investigation will delve further into the extent and mechanics of the bribery scheme, and interview key politicians active at the time. A Dutch parliamentary team is following up on the case in the Netherlands and in Chile. Key targets of the investigation include Edmundo Perez Yoma, Chile’s former minister of defense and currently its interior minister, along with his then deputy Mario Fernandez, now member of the Constitutional Court. Both are suspected of facilitating the bribery. Chile has announced similar investigations.

One Dutch official at the time of the tank sales, then Minister of Defense Joris Voorhoeve, joined the call for parliament to undertake a broad investigation into RDM’s bribes. He defended his own role. While Voorhoeve acknowledges that he issued an export license for the 202 Dutch Leopard tanks, he maintains he is appalled and shocked by the allegations of bribery. “The Netherlands government would never agree to pay bribes to get a deal closed,” he said, “nor participate in any other form of corruption.” The sales were justified, he said, because when they took place in 1998, Chile had become a democracy and General Augusto Pinochet, who had ruled from 1973 to 1990, was no longer president. But in fact, the former dictator still wielded considerable influence as senator for life and commander-in-chief of the armed forces, positions he retained until his death in 2006.

The parliamentary investigation, while welcomed by many, is late in coming. For years politicians ignored requests by the Netherlands Socialist Party for a formal investigation—again, sparked in part by CorpWatch’s reporting on the money RDM paid to the former dictator and his entourage.

According to a Swiss newspaper, van den Nieuwenhuyzen, currently a Swiss resident, said that he was not aware that the company he once owned was under investigation for payments to Chilean army officials.

But former RDM workers and associates charged that the company paid millions to Chilean colonels and brigadier generals through a third party, with $1.6 million going to a private consultant to the late general Pinochet. RDM said the $1.6 million was a donation to the Pinochet Foundation, a Santiago-based organization that promotes the general’s legacy.

Chilean and cooperating Dutch private investigators that examined the Pinochet’s overseas bank accounts have found that the dictator had stashed almost $28 million overseas, mainly in European bank accounts. Dutch investigators will look for links between that money, the two recently jailed Chilean army officers, and Pinochet.

The spokesperson of the Dutch Socialist Party in Rotterdam told CorpWatch that there have been no successful prosecutions of corporations in the Netherlands for foreign bribes, because it is extremely difficult to secure evidence in foreign countries. Of the scores of cases under consideration, none have yet reached the courts. If RDM is charged, it will be the first time Dutch officials or businesspeople are prosecuted under the new regulations.

Corporations and the Amazon

Posted by Philip Mattera on August 16th, 2009


Originally posted on August 13, 2009 at http://dirtdiggersdigest.org/archives/746

These days just about every large corporation would have us believe that it is in the vanguard of the fight to reverse global warming. Companies mount expensive ad campaigns to brag about raising their energy efficiency and shrinking their carbon footprint.

Yet a bold article in the latest issue of business-friendly Bloomberg Markets magazine documents how some large U.S.-based transnationals are complicit in a process that does more to exacerbate the climate crisis than anything else: the ongoing destruction of the Amazon rain forest.

While deforestation is usually blamed on local ranchers and loggers, Bloomberg points the finger at companies such as Alcoa and Cargill, which the magazine charges have used their power to get authorities in Brazil to approve large projects that violate the spirit of the country’s environmental regulations.

Alcoa is constructing a huge bauxite mine that will chew up more than 25,000 acres of virgin jungle in an area, the magazine says, “is supposed to be preserved unharmed forever for local residents.” Bloomberg cites Brazilian prosecutors who have been waging a four-year legal battle against an Alcoa subsidiary that is said to have circumvented the country’s national policies by obtaining a state rather than a federal permit for the project.

Bloomberg also focuses on the widely criticized grain port that Cargill built on the Amazon River. Cargill claims to be discouraging deforestation by the farmers supplying the soybeans that pass through the port, but the Brazilian prosecutors interviewed by Bloomberg expressed skepticism that the effort was having much effect.

Apart from the big on-site projects, Bloomberg looks at major corporations that it says purchase beef and leather from Amazonian ranchers who engage in illegal deforestation. Citing Brazilian export records, the magazine identifies Wal-Mart, McDonald’s, Kraft Foods and Carrefour as purchasers of the beef and General Motors, Ford and Mercedes-Benz as purchasers of leather.

The impact of the Amazon cattle ranchers was also the focus of a Greenpeace report published in June. That report put heat on major shoe companies that are using leather produced by those ranchers.

Nike and Timberland responded to the study by pledging to end their use of leather hides from deforested areas in the Amazon basin. Greenpeace is trying to get other shoe companies to follow suit.

Think of the Amazon the next time a company such as Wal-Mart tells us what wonderful things it is doing to address the climate crisis.

Chipotle Grilled!

Posted by Denver Fair Food on July 31st, 2009

Originally posted on July 23 at http://denverfairfood.blogspot.com/2009/07/chipotle-grilled.html.

Chipotle is getting burned by the very scheme it cooked up as what it thought was a great public relations opportunity - sponsoring free screenings of Food, Inc. - is becoming a PR fiasco.

Food, Inc. director Robert Kenner and co-producer Eric Schlosser speak out and Chipotle has to answer tough questions in Tom Philpott's must-read article on Grist.org "Chipotle Grilled: Burrito chain’s Food, Inc. sponsorship generates off-screen drama over farm-worker issues."

Schlosser explains that while many of Chipotle's efforts are great, he nonetheless "cares more about human rights than any of those things." He continues: "If Taco Bell, Subway, Burger King, and McDonald’s can reach agreement with the CIW, I don’t see why Chipotle can’t."

Kenner likewise, the article states, "made clear that he disagreed with the company’s position on the CIW" even if he agrees with other things Chipotle is doing. Kenner explains: "I was hopeful that by associating itself with a film that promotes workers’ rights, [Chipotle] might be inclined to sign with the Coalition . . . And now I’m not confident they will.”

Our cameo in this unfolding fiasco is also noted: "Chipotle clearly resents such critical statements at events designed to demonstrate its sustainability cred. At one of its screenings in Denver, Chipotle employees barred people from the Campaign for Fair Food to speak after the screening—overturning an arrangement that had been made with Food, Inc’s public-education campaign. " After investigating the incident, the article decides: "In other words, people wanting to discuss the CIW issue aren’t to be given stage time at the Chipotle-sponsored Food, Inc. screenings."

Our story of Chipotle's eagerness to shut up members of Denver Fair Food has really made a splash on the internet, appearing on the websites of the Organic Cosumers Association, the Coporate Ethics Network, US Indymedia, and others.

Of course Denver wasn't the only city where Chipotle got heat from Fair Food activists while trying to bask in Food, Inc.'s glory. All over the country allies of the Coalition of Immokalee Workers took to the movies to deflate Chipotle's hot air about "food with integrity" with some sharp truths about farm labor in Chipotle's supply chain. See the great photo report from the nationwide "Battle of the Burrito" on the CIW website.

References to this PR fiasco are popping up in unforseen places such as thedailygreen or even more surprising the mainstream investor blog The Motely Fool. And the bed which Chipotle made for itself in which it now must lie can't be feeling any more comfortable.

The lesson for Chipotle to learn from its bungled Food, Inc. PR experiment? The ecorazzi blog has these fitting words: "you can’t have your 1000+ calorie burrito and eat it too."

Wal-Mart’s (Un)sustainability Index

Posted by Philip Mattera on July 24th, 2009

Originally posted on July 24 at http://dirtdiggersdigest.org/archives/703.

Wal-Mart has taken the latest in a long series of steps to make itself look good by imposing burdens on its suppliers. The mammoth retailer, which is thriving amid the recession, recently announced plans to require its more than 100,000 suppliers to provide information about their operations that would form the basis of a product sustainability index.

Rating products is a good idea. It’s already being done by various non-profit organizations that bring independence and legitimacy to the process. Wal-Mart, by contrast, brings a lot of negative baggage. In recent years, Wal-Mart has used a purported commitment to environmental responsibility to draw attention away from its abysmal record with regard to labor relations, wage and hour regulations, and employment discrimination laws. It also wants us to forget its scandalous tax avoidance policies and its disastrous impact on small competitors. The idea that a company with a business model based on automobile-dependent customers and exploitative supplier factories on the other side of the globe can be considered sustainable should be dismissed out of hand. Yet Wal-Mart is skilled at greenwashing and is, alas, being taken seriously by many observers who should know better.

On close examination, Wal-Mart’s latest plan is, like many of its previous social responsibility initiatives, rather thin. All the company is doing at first is to ask suppliers to answer 15 questions. Ten of these involve environmental issues such as greenhouse gas emissions, water use, waste generation and raw materials sourcing. The final five questions are listed under the heading of “People and Community: Ensuring Responsible and Ethical Production.”

Two of them involve “social compliance.” It is an amazing act of chutzpah for Wal-Mart, which probably keeps more sweatshops in business than any other company, to claim moral authority to ask suppliers about the treatment of workers in their supply chain.

The questions in this category seem to assume that suppliers don’t do their own manufacturing. This is a tacit acknowledgement of how Wal-Mart has forced U.S. manufacturers to shift production offshore, and often to outside contractors. Now Wal-Mart has to ask those companies to be sure they know the location of all the plants making their products and the quality of their output.

The point about quality was one that CEO Mike Duke (photo) emphasized when announcing the rating system. This is also highly disingenuous. For years, Wal-Mart was notorious for pressing suppliers to reduce the quality of their goods to keep down prices. Now the behemoth of Bentonville is suddenly a proponent of proponent of products that “are more efficient, that last longer and perform better.” Will Wal-Mart pay its suppliers higher prices to cover the costs of improving quality?

goodguideI can’t bring myself to jump on Wal-Mart’s bandwagon. If I want product ratings I will turn not to Mike Duke but rather to someone like Dara O’Rourke, who founded a website called Good Guide that rates consumer products and their producers using independently collected data from social investing firms such as KLD Research and non-profits such as the Environmental Working Group. It uses criteria such as labor rights, cancer risks and reproductive health hazards that are unlikely to ever find their way into the Wal-Mart index.

Good Guide also rates companies, including Wal-Mart, which receives a mediocre score of 5.3 (out of 10), and it reaches that level thanks to its marks on p.r.-related measures such as charitable contributions and some but not all environmental measures. In the category of Consumers it gets a 4.1, Corporate Ethics 3.9, and for Labor and Human Rights 4.1 (which is generous).

Maybe Wal-Mart should focus on improving its own scores before presuming to rate everyone else.

Dirt Diggers Digest is written by Philip Mattera, director of the Corporate Research Project, an affiliate of Good Jobs First.

Shell's Settlement Doesn't Hide Unsettling Reality in Nigeria

Posted by Stephen Kretzmann on June 11th, 2009

Originally posted June 10, 2009, on The Huffington Post.

After thirteen years and countless hours by lawyers, community members, and activists around the world, Royal Dutch Shell finally settled the Wiwa v Shell case in a New York court for $15.5 million.

Plaintiffs in the case, which included Ken Saro-Wiwa Jr., and the families of other Ogoni men hanged in November 1995, charged the Royal Dutch/Shell company, its Nigerian subsidiary, and the former chief of its Nigerian operation, Brian Anderson, with complicity in the torture, killing, and other abuses of Ogoni leader Ken Saro-Wiwa and other non-violent Nigerian activists in the mid-1990s in the Ogoni region of the Niger Delta.

Shell says they settled the case as a "humanitarian gesture" to the Ogoni. Does anyone really believe that after fighting for more than a decade to keep this out of court, Shell suddenly woke up and felt great compassion for the Ogoni? Please.

Shell settled because they were scared, and they knew the evidence against them was overwhelming. They publicly say they had nothing to do with the execution of Ken Saro-Wiwa and the other Ogoni, and yet there were documents and video that they fought hard to keep out of the public eye.

Evidence that was to be introduced in the case included an internal Shell memo where the head of Shell Nigeria offered to intervene on Saro-Wiwa's behalf, if only Saro-Wiwa and others would stop claiming that Shell had made payments to the military.

Then there was this memo, requesting payment to the Nigerian military for an incident in which at least one Ogoni man died.

Witness were set to testify that they saw Shell vehicles transporting Nigerian soldiers, that they saw Shell employees conferring with the military, that they saw money being exchanged between Shell employees and military officers, and that they heard military officers, including the brutal Major Okuntimo of the Rivers State Internal Security Task Force, make admissions regarding the work they were doing on behalf of Shell.

We have known some of Shell's involvement in this tragedy for a long time. In early May of 1994, Ken Saro-Wiwa Sr. faxed me a memo authored by Major Okuntimo which read "Shell operations still impossible unless ruthless military operations are undertaken for smooth economic activities to commence" and further called for "pressure on oil companies for prompt regular inputs."

I received that fax and immediately called Ken. He said "this is it. They're going to kill us all. All for Shell." It was the last time I talked with him. Several weeks later he was arrested on the trumped up charges for which he was ultimately hanged.

In the last day, lots of people have asked me if $15.5 million is enough to compensate for the hanging of nine men, the death of thousands more, and for the destruction of an ecosystem. No of course not. But was it on par with what a jury would have awarded in this case? Yes, lawyers tell me, for sure.

More importantly, does the settlement bring relief to Ken Wiwa Jr. and the families of the other men who were executed? If you read Ken's thoughtful and moving piece in the Guardian , the answer is clearly yes. That alone should be cause for celebration.

Ken Sr.'s famous last words from the gallows were "lord take my soul but the struggle continues." In this moment, perhaps more than ever before, we need to heed that call to action. The settlement in this case brings satisfaction to the plaintiffs for an event that happened 14 years ago. It in no way, shape or form excuses or absolves Shell of their ongoing destruction of the Niger Delta environment.

One of the central complaints of Niger Delta communities for forty years has been gas flaring, which sends plumes of toxic pollutants into the air and water of the Niger Delta. Gas flaring endangers human health, harms local ecosystems, emits huge amounts of greenhouse gases, wastes vast quantities of natural gas, and is against Nigerian law. Shell does it nowhere else in the world in volumes that are even remotely comparable to what they flare in the Delta.

But Shell is still flaring gas in Nigeria.

While there is no doubt that the settlement represented a significant victory for the plaintiffs' in this one human rights case against Shell, true justice will not be served as long as the people of Nigeria continue to suffer the terrible impact of Shell's operations. Shell estimates it would cost about $3 billion -- only 10% of just their last year's profits -- to end Shell's gas flaring in Nigeria once and for all.

But instead of putting their great "humanitarian concern" into action, Shell points the finger at the Nigerian government and demands that they pay to end this practice.

Send a message to Shell's CEO
Jeroen van der Veer, and let him know that if he really wants to prove his great concern for the Ogoni people, he'll end gas flaring once and for all.

The struggle continues.

What's not in Chevron's annual report

Posted by Cameron Scott on May 26th, 2009

Originally posted at http://www.sfgate.com/cgi-bin/blogs/green/detail?entry_id=40674

When people with strong ideological perspectives are often outraged by media coverage of their pet issues. When both sides are mad, you know you're doing something right. But how often do you hear corporations furious about they way they are covered in the business section? The section seems to lend itself to favor-currying and soft-shoeing.

In the lead-up to Chevron's annual shareholders meeting tomorrow in San Ramon, the company landed a puff piece on KGO focusing on its efforts to decrease its water usage. No mention of the Amazon controversy, and no mention of outside pressure on Chevron, EBMUD's largest water user.

I'm disappointed to say that a Chronicle interview with the company's top lawyer also softballs the issues, while giving Chevron the opportunity to present its side of the story with no opportunity for response from the company's many critics. [Update: Chron editors tell me there will be more coverage of Chevron later in the week.]

Well, Chevron's opponents, including San Francisco's Amazon Watch, have taken matters into their own hands, releasing an alternate annual report that presents the externalities not listed in the company's balance sheet, which shows a record profit of $24 billion, making the company the second most profitable in the United States.

Did you know that Chevron's Richmond refinery was built in 1902 and emitted 100,000 pounds of toxic waste in 2007, consisting of no less than 38 toxic substances? The EPA ranks it as one of the worst refineries in the nation. With 17,000 people living within 3 miles from the plant, you'd think the San Ramon-based company would take local heat from more than just a couple dozen activists.

Chevron has sought to brand itself an "energy" company, one eagerly pursuing alternatives to petroleum. Its aggressive "Will You Join Us?" ad campaign asked regular folks to reduce their energy consumption, suggesting that Chevron was doing the same. In actuality, the company spent less than 3 percent of its whopping capital and exploratory expenditures on alternative energy. And it has refused to offer better reporting on its greenhouse gas emissions, despite strong shareholder support for it. (The aggressive, and misleading, ad campaign seems to have ired the report's researchers as well: The report is decorated by numerous parodies, and some have been wheat-pasted around town.)

It's a very well researched report, written by the scholar Antonia Juhasz, clearly divided into regional issues, and it's a much needed counterbalance to the friendly coverage Chevron is otherwise getting. (Juhasz was interviewed on Democracy Now this morning.)

For information on protesting the shareholder meeting early tomorrow morning, click here.

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