Part IV: DeLay's Unregulated Pacific "Paradise"

By Stephen Pizzo, AlterNet. Posted May 15, 2002.

Read Part I: DeLay's Axis of Influence
Read Part II: DeLay's Judge Dread
Read Part III: DeLay's Godfather


DeLay's North Pacific Unregulated "Paradise"

As Tom DeLay preached his pro-business/anti-regulation theology in the US, his model of perfection was far from the mainland. The U.S. protectorate of the Northern Mariana Islands -- 14 islands in the North Pacific -- have become something of a free-enterprise petting zoo for DeLay and those he wishes to convert to his way of thinking.

At the end of World War II, the U.S. acquired the islands, which are located off the coast of booming Asia. To encourage development and self-sufficiency Congress exempted the islands from the very kinds of U.S. business regulations and oversight DeLay despised. Even today the island's minimum wage is only $3.05. Other work and safety regulations either do not apply at all or are rarely enforced.

In short, the Marianas embodied many of the key ideals DeLay and other House Republicans were pushing in their 1994 Contract With America.

For Asian sweatshop operators, the Marianas became the Promised Land incarnate. Since the islands were officially U.S. territory, garment factories there were able to tag their products with the coveted "Made in the USA" label. No rules, no regulators, no inspectors, no health and safety laws. What more could a sweatshop operator ask for?

The opportunity was quickly recognized by Asian sweatshop operators like Hong Kong's Tan Holdings, run by garment mogul Willie Tan. Deep in the lush jungles, far from the island's white beaches and luxury hotels, garment factories quickly set up shop. They staffed their factories with workers from China and the Philippines with promises of work in the US. But, workers soon discovered that the work contracts they signed consigned them to near-indentured servitude deep in the Marianas steamy jungles. Wages were low, hours were long. The companies docked workers' pay for housing, food, medical treatments and other charges. The low wages and high deductions made it nearly impossible for workers to save enough money to return home.

None of this was a secret back home in the U.S. In 1998, ABC, CNN, the BBC and the New York Times each confirmed reports of forced labor, sex slaves and domestic forced servitude among the Marianas' so-called "guest workers."
According to the US Department of Labor, the indigenous US population of Marianas have an unemployment rate that hovers continuously around 14%. The unemployment rate of the island's 40,000 so-called guest workers on the other hand is only 5%.

Human rights groups, long up in arms over the work conditions on the islands, charged that sweatshop operators did not appreciate it when their female employees got pregnant. Numerous allegations of forced abortions surfaced over the years.
The protests began to reach the ears of Congress. Rep. George Miller, (D-Ca) and others began to demand that US labor and environmental laws be applied to the Marianas. Tom DeLay and his friend Jack Abramoff swung into action and fashioned a vigorous and largely successful counter-attack.

Denying the reports that workers were being mistreated, Abramoff said the Marianas' unregulated environment was in fact a success story and a model for economic development. He said that efforts to regulate the islands' garment factories by some members of Congress like Miller were nothing less than immoral. "These are immoral laws designed to destroy the economic lives of a people," Abramoff said. He went on to compare the proposed laws with the Nuremberg laws that restricted German Jews under the Nazis.

The Marianas became a pedal-to-the-metal cause for DeLay and another cash cow for Abramoff. Abramoff and his team, which now included DeLay's former chief of staff Bill Jarrell, swung into action. They arranged junkets to the islands for scores of Republicans on The Hill. DeLay himself spent New Years Day 1998 in the Marianas with his wife and daughter and his then Chief of Staff, Ed Buckham.

Another of Abramoff's Mariana lobbyists was Patrick Pizzella who, believe it or not, is now serving in the Bush Administration as assistant secretary of Labor. It was Pizzella's job to organize Abramoff's political junkets to the islands
Despite the growing public awareness of work conditions in the islands, Tom DeLay's defense of the status quo remained unshaken. In 1998 DeLay co-authored a letter with House Majority Leader Dick Army (R-TX). The two men, writing to the islands' governor, expressed how "impressed" they were with the Marianas' "commitment to advancing the principles of free markets, enterprise, tax reform and other innovative approaches to governance."

Such high level Washington support was not lost on sweatshop operators. In 1999, a human rights group quoted a Marianas sweatshop operator with an upbeat attitude about Tom DeLay's growing influence in Congress. An investigator for the group posed as an investor who was considering investing in Mariana garment operations. The investigator asked the sweatshop operator about the outlook for Congress applying U.S. workplace rules to the Marianas. The garment factory operator was not worried.

"I have a real good friend of Tom DeLay," he said. "the Majority Whip. And Tom tell me, as long as we are in power they (Democrats in Congress) can't even see the light at the end of the tunnel. So, now it going to be two years, because Tom become real powerful this Congress so guarantee next two years no problem. Tom said if they elect me as majority whip, I make the schedule of Congress. And I'm not going to put it on the schedule. So, Tom told me, forget it, not a chance.." (Contemporary Women's Issues 1999)

While Abramoff's team wined and dined groups from Washington at luxury Mariana resorts, deep in the jungles the garment factories continued their operations unregulated and unabated. Upon his return from the islands on one such trip a reporter asked DeLay about alleged sweatshop conditions there. "I saw some of those factories," DeLay responded. "They were air conditioned. I didn't see anyone sweating." Delay laughed at his own joke and walked off.

In 1999 the battle moved from the Republican controlled Congress to the courts. A suit filed by human rights groups representing the Mariana guest workers was settled in US District Court. The suit described the Marianas (also known as Saipan) as "America's worst sweatshop, replete with beatings, forced abortions, vermin-infested worker quarters, barbed wire and armed guards where workers put in 12-hour shifts, seven days a week."

The 32 factories that settled the suit were mostly owned by Chinese, Japanese and Korean companies that supplied more than $1 billion a year of "Made in America" garments to some of America's leading retailers and labels.

Nevertheless, DeLay continues to support the current unregulated Mariana work rules. He has gone so far as to suggest that the United States emulate the way the islands' employers import guest workers from China and the Philippines and suggested that it may provide a model for mainland employers who wish to exploit cheap Mexican labor.

"Returning from a fact-finding trip (to the Marianas) where he played two rounds of golf at the first-class Lao Loa Bay Golf Resort, DeLay blasted critics of what he called Saipan's 'free market success.' He went on to explain how he wants to use a set of Chinese-owned sweatshops on the far-off U.S. territory -- factories manned by low-paid Chinese and Sri Lankan indentured servants living in squalor -- as a model for Mexican labor camps here on the mainland." (Dallas Observer/New York Times Group)

Besides the obvious problems with DeLay's support of poor work conditions in the Marianas, his support has also undercut his own constituents back home. There are about 60,000 apparel workers living and working in El Paso and San Antonio Texas. In fact, Texas ranks third in the nation for its number of garment workers. According to Joe Allen, a garment business consultant, the number of garment jobs is rapidly shrinking as factories close due to low-cost off shore operations like those in the Marianas.

"Tan Holdings is one of the most powerful companies on Saipan. 'Workers have fallen ill due to the horrible working conditions they are forced to endure,' said Medea Benjamin, a spokeswoman for Global Exchange. Drinking water provided workers was contaminated with e.coli and fecal coliform. Ill workers were denied medical treatment and locked in their barracks. Factory officials refused to allow health inspectors in the factory." (Hong Kong Standard 1999)

But with millions in lobbying money pouring in from Mariana business interests, DeLay and Abramoff have shown little interest in protecting American jobs. On one trip to the Marianas sponsored by the islands' largest sweatshop operator, Willie Tan, DeLay was effusive in his praise and support.

"On his first night on the island, DeLay was invited to a reception at the posh, beachfront Pacific Islands Club hosted by Will Tan, the powerful garment factory king. 'When one of my closest and dearest friends, Jack Abramoff, your most able representative in Washington, D.C., invited me to the islands, I wanted to see firsthand the free-market success and progress and reform you have made," DeLay said. Even though I have been here for only 24 hours, I have witnessed the economic success... (But) You are up against the forces of big labor and the radical left. Dick Armey and I made a promise to defend the island's present system. Stand firm. Resist evil. Remember that all truth and blessings emanate from our Creator."(Dallas Observer)

The Marianas account has paid off handsomely for both DeLay and Abramoff, whose lobbying efforts resulted in more than $8 million in fees over the past five years, some of which inevitably ended up in DeLay's leadership PAC and as personal contributions from Abramoff over the years to DeLay's campaign war chests. DeLay was also able to distribute some of that money to those in Congress friendly to his cause - a fact Abramoff was quick to point out to his client:

"Thanks to past trips the Commonwealth of Northern Marianas has many friends on the Appropriations Committees in Congress," Abramoff wrote to Hong Kong sweatshop mogul Willie Tan. The Tan-controlled newspaper, Saipan Tribune, responded with an article lauding Abramoff:

"If [Abramoff's] past success in defending our interests is not enough reason to lock him into a long-term deal, the fact that George W. Bush is now the new President is yet another reason. [Abramoff] was able to defend us by educating powerful Members of Congress and arranging a trip to these islands by the most powerful member, Congressman Tom DeLay. Mr. Abramoff and his team have racked up win after win for these islands. (Saipan Tribune 2001 Editorial)

DeLay Gets Enron a Piece of the Mariana Action

Although far from Texas, the Marianas provided DeLay with yet another opportunity to help Enron. When the Marianas put out a call for bids for a new $120 million power plant, a Japanese company was awarded the contract. Enron, attracted by the island's lack of environmental rules, wanted in and complained to DeLay that they had not been given a fair shot at the contract for the power plant.

DeLay responded by calling in some chits from his friends in the Mariana administration - in particular Ben Fital, a conservative politician whom DeLay's former aides, Ed Buckham and Mike Scanlon, helped get elected as the island's representative in Congress.(The Washington Post reported that Buckham's lobbying firm, Alexander Strategies Group's representation of Enron's interests in the Marianas won him $50,000 in fees.)

Delay demanded that the power plant bidding be re-opened and that Enron's bid be given new consideration.

And so it came to pass. The bidding was re-opened and Enron was declared the winner. Apparently, free-market mechanisms like open bidding are only good when they favor the right player. Islanders say the bidding was rigged in Enron's favor.

"There were all kinds of political pushes from the top and the side and every way," Vincent Mesa, the island's former manger of the its power utilities, recalled later. "There were all kinds of political interference. They (government officials) didn't want to understand it. They said, 'Just do it! Give Enron the contract."

But, now with Enron in bankruptcy the power project has been left to rust in the Pacific sun and the islands are stuck with spotty electric power and lots of debt.

Read Part I: DeLay's Axis of Influence
Read Part II: DeLay's Judge Dread
Read Part III: DeLay's Godfather

Investigative journalist Stephen Pizzo's bestselling book, "Inside Job: The Looting of America's Savings and Loans," is now available as an ebook.

              

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