Russell Mokhiber

New West Virginia legislation would make civil disobedience against gas pipelines a felony

Industry drafted legislation (HB 4615) that would make civil disobedience against a pipeline or other fossil fuel projects a felony is moving through the West Virginia legislature.

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Corporate Crime by Nickel and Dime

What's the fastest growing corporate crime in America?

Corruption? Pollution? Market manipulation? Securities fraud? No.

It's hidden fees.

It's how the giant credit card, cell phone, cable, and banking corporations nickel and dime you to death. And there are literally scores of hidden fees with more being proliferated every day.

Bounce a check? That will be a $39 bounced check fee.

One day late on your credit card payment? That will be a $39 late payment fee -- and we'll hike your interest rate from the introductory 0.00 percent to 15.99 percent.

Towel fee. Towel fee?

Yeah, you get one of those deals on a swank hotel. And you show up at the hotel and get hit with a $30 a day resort fee -- including a towel fee. In case you go to the pool and use the towels. Or even if you don't. Pay the fee.

Here's one of my favorites -- the ATM denial fee. You go to your ATM machine and ask for $400 in cash. You get back a note from the ATM machine saying -- sorry, but your daily limit is $300.

So, you ask for $300. The machine spits out the $300, you grab your card and walk away. Next month, you get your statement. And there it is -- $1.50. ATM denial fee.

Bob Sullivan has written one of the best consumer books of recent decades -- Gotcha Capitalism: How Hidden Fees Rip You Off Every Day -- and What You Can Do About It (Ballantine Books, 2008). Call him the Upton Sinclair of the modern corporate jungle.

It has yet to be reviewed by the mainstream press, but on the weight of a couple of interviews on National Public Radio, it has already broken into the New York Times Paperback Advice Top Ten.

And that's not an easy list to break into. Five of the top ten books on that list are diet books -- with the top two being Skinny Bitch and Skinny Bitch in the Kitch.

If there were a top ten corporate crime books of all time list, Gotcha Capitalism would be on it.

In an interview with Corporate Crime Reporter, Sullivan said he knew something was up with the book because every time he's interviewed about it, he gets a few minutes into his pitch and the interviewer interrupts with a horror story.

And in fact, that's how Sullivan compiled the stories for his book. A couple of years ago, he was in New Orleans covering Hurricane Katrina for MSNBC.com. He started a blog called the Red Tape Chronicles about the problems facing victims of the Hurricane.

But pretty soon, people were contacting him from all over the country about consumer problems of their own. It became clear that corporate rip-offs were a huge problem. Since starting the column two years ago, he has received 50,000 e-mail messages from consumers around the country. The biggest culprits were credit card companies, banks, cell phone companies and cable companies.

Sullivan conducted a survey of consumers nationwide, asking them to identify hidden fees in their most common purchases. And he estimates that the average consumer gets hit with $1000 a year in hidden fees. That comes out to $45 billion a year.

But that's clearly an underestimate. Consumer Reports magazine says that hidden fees cost consumers $215 billion a year -- or $4,000 a year per consumer.

That's more like it.

And then you have your $25 billion a year that brokerage firms skim off your retirement funds every year for essentially doing nothing. Or the real estate fees when you close on a house. Sullivan has a whole book of them.

The rise of the hidden fee corporate crime wave parallels the corporate attack on consumer fraud enforcement. Sullivan says that hidden fees have flourished largely because laws governing false advertising aren't enforced.

"There are great folks who work very hard at the Federal Trade Commission (FTC)," Sullivan said. "They don't like it when I say this, but the truth about the FTC is that in 1979, it had 1,700 full time employees. Since then they have become responsible for huge areas like identity theft, the do not call list, internet security. And our population has grown by 75 million since 1979. But today, the FTC has 1,000 full-time employees. So, they have been cut almost in half. The budget is more of a flat-line. And you see that same trajectory at all of the other consumer protection agencies."

If you are having problems with high blood pressure or heart palpitations, or if you are manic, you might want to leave this book for another day. I mean, do you really want to read that AT&T sought consultants to design a mailer so that you, the average Joe consumer, would be more likely to throw it in the trash?

And why would they want you to throw a mailer in the trash? Because if you throw it in the trash, you agree to giving up your right to sue them if there is a dispute over your phone bill.

Do you really want to know that the hidden fee rip-off artists have two complaint desks -- one in Southeast Asia for the regular folks, and one in corporate headquarters in the USA for the sophisticates?

That's right. Consumers are divided into two categories -- suckers and sophisticates. For suckers who don't know how to complain, you get the help desk in Thailand, or India, or the Philippines.

For people who know how to work the system, and struggle to get their money back, you get the VIP treatment -- and a good chance to get at least some of the ripped off money back.

I experienced this first hand earlier this month. The Verizon DSL at our home went out. I spent five days talking to very kind people at Verizon help centers throughout Southeast Asia.

Then one day, I wrote about my problems on a blog. It got picked up by some corporate person in the U.S. And within 30 minutes of writing the piece, I got a call from Verizon telling me that someone from "escalation" will be calling me.

Within five minutes, Wendy from "escalation" calls me.

Within an hour, the problem is fixed.

I haven't followed all of the presidential debates. But as far as I can tell, Wolf Blitzer hasn't asked any of the presidential candidates about the fastest growing corporate crime in America.

Maybe that's because the corporate criminals sponsor the debates or own the television networks -- and contribute to the candidates.

In any event, the bottom line is you can buy three of Sullivan's books for the cost of a bounced check fee. Or a late payment fee.

Buy a bunch and pass them around. It teaches us how they rip us off.

And how to get to Wendy at escalation.

Twenty Things You Should Know About Corporate Crime

The following is text from a speech delivered by Russell Mokhiber, editor of Corporate Crime Reporter to the Taming the Giant Corporation conference in Washington, D.C., June 9, 2007.

20. Corporate crime inflicts far more damage on society than all street crime combined.

Whether in bodies or injuries or dollars lost, corporate crime and violence wins by a landslide.

The FBI estimates, for example, that burglary and robbery -- street crimes -- costs the nation $3.8 billion a year.

The losses from a handful of major corporate frauds -- Tyco, Adelphia, Worldcom, Enron -- swamp the losses from all street robberies and burglaries combined.

Health care fraud alone costs Americans $100 billion to $400 billion a year.

The savings and loan fraud -- which former Attorney General Dick Thornburgh called "the biggest white collar swindle in history" -- cost us anywhere from $300 billion to $500 billion.

And then you have your lesser frauds: auto repair fraud, $40 billion a year, securities fraud, $15 billion a year -- and on down the list.

19. Corporate crime is often violent crime.

Recite this list of corporate frauds and people will immediately say to you: but you can’t compare street crime and corporate crime -- corporate crime is not violent crime.

Not true.

Corporate crime is often violent crime.

The FBI estimates that, 16,000 Americans are murdered every year.

Compare this to the 56,000 Americans who die every year on the job or from occupational diseases such as black lung and asbestosis and the tens of thousands of other Americans who fall victim to the silent violence of pollution, contaminated foods, hazardous consumer products, and hospital malpractice.

These deaths are often the result of criminal recklessness. Yet, they are rarely prosecuted as homicides or as criminal violations of federal laws.

18. Corporate criminals are the only criminal class in the United States that have the power to define the laws under which they live.

The mafia, no.

The gangstas, no.

The street thugs, no.

But the corporate criminal lobby, yes. They have marinated Washington -- from the White House to the Congress to K Street -- with their largesse. And out the other end come the laws they can live with. They still violate their own rules with impunity. But they make sure the laws are kept within reasonable bounds.

Exhibit A -- the automobile industry.

Over the past 30 years, the industry has worked its will on Congress to block legislation that would impose criminal sanctions on knowing and willful violations of the federal auto safety laws. Today, with very narrow exceptions, if an auto company is caught violating the law, only a civil fine is imposed.

17. Corporate crime is underprosecuted by a factor of say -- 100. And the flip side of that -- corporate crime prosecutors are underfunded by a factor of say -- 100.

Big companies that are criminally prosecuted represent only the tip of a very large iceberg of corporate wrongdoing.

For every company convicted of health care fraud, there are hundreds of others who get away with ripping off Medicare and Medicaid, or face only mild slap-on-the-wrist fines and civil penalties when caught.

For every company convicted of polluting the nation’s waterways, there are many others who are not prosecuted because their corporate defense lawyers are able to offer up a low-level employee to go to jail in exchange for a promise from prosecutors not to touch the company or high-level executives.

For every corporation convicted of bribery or of giving money directly to a public official in violation of federal law, there are thousands who give money legally through political action committees to candidates and political parties. They profit from a system that effectively has legalized bribery.

For every corporation convicted of selling illegal pesticides, there are hundreds more who are not prosecuted because their lobbyists have worked their way in Washington to ensure that dangerous pesticides remain legal.

For every corporation convicted of reckless homicide in the death of a worker, there are hundreds of others that don’t even get investigated for reckless homicide when a worker is killed on the job. Only a few district attorneys across the country have historically investigated workplace deaths as homicides.

White collar crime defense attorneys regularly admit that if more prosecutors had more resources, the number of corporate crime prosecutions would increase dramatically. A large number of serious corporate and white collar crime cases are now left on the table for lack of resources.

16. Beware of consumer groups or other public interest groups who make nice with corporations.

There are now probably more fake public interest groups than actual ones in America today. And many formerly legitimate public interest groups have been taken over or compromised by big corporations. Our favorite example is the National Consumer League. It’s the oldest consumer group in the country. It was created to eradicate child labor.

But in the last ten years or so, it has been taken over by large corporations. It now gets the majority of its budget from big corporations such as Pfizer, Bank of America, Pharmacia & Upjohn, Kaiser Permanente, Wyeth-Ayerst, and Verizon.

15. It used to be when a corporation committed a crime, they pled guilty to a crime.

So, for example, so many large corporations were pleading guilty to crimes in the 1990s, that in 2000, we put out a report titled The Top 100 Corporate Criminals of the 1990s. We went back through all of the Corporate Crime Reporters for that decade, pulled out all of the big corporations that had been convicted, ranked the corporate criminals by the amount of their criminal fines, and cut it off at 100.

So, you have your Fortune 500, your Forbes 400, and your Corporate Crime Reporter 100.

14. Now, corporate criminals don’t have to worry about pleading guilty to crimes.

Three new loopholes have developed over the past five years -- the deferred prosecution agreement, the non prosecution agreement, and pleading guilty a closet entity or a defunct entity that has nothing to lose.

13. Corporations love deferred prosecution agreements.

In the 1990s, if prosecutors had evidence of a crime, they would bring a criminal charge against the corporation and sometimes against the individual executives. And the company would end up pleading guilty.

Then, about three years ago, the Justice Department said -- hey, there is this thing called a deferred prosecution agreement.

We can bring a criminal charge against the company. And we will tell the company -- if you are a good company and do not violate the law for the next two years, we will drop the charges. No harm, no foul. This is called a deferred prosecution agreement.

And most major corporate crime prosecutions are brought this way now. The company pays a fine. The company is charged with a crime. But there is no conviction. And after two or three years, depending on the term of the agreement, the charges are dropped.

12. Corporations love non prosecution agreements even more.

One Friday evening last July, I was sitting my office in the National Press Building. And into my e-mail box came a press release from the Justice Department.

The press release announced that Boeing will pay a $50 million criminal penalty and $615 million in civil penalties to resolve federal claims relating to the company’s hiring of the former Air Force acquisitions chief Darleen A. Druyun, by its then CFO, Michael Sears -- and stealing sensitive procurement information.

So, the company pays a criminal penalty. And I figure, okay if they paid a criminal penalty, they must have pled guilty.

No, they did not plead guilty.

Okay, they must have been charged with a crime and had the prosecution deferred.

No, they were not charged with a crime and did not have the prosecution deferred.

About a week later, after pounding the Justice Department for an answer as to what happened to Boeing, they sent over something called a non prosecution agreement.

That is where the Justice Department says -- we’re going to fine you criminally, but hey, we don’t want to cost you any government business, so sign this agreement. It says we won’t prosecute you if you pay the fine and change your ways.

Corporate criminals love non prosecution agreements. No criminal charge. No criminal record. No guilty plea. Just pay the fine and leave.

11. In health fraud cases, find an empty closet or defunct entity to plead guilty.

The government has a mandatory exclusion rule for health care corporations that are convicted of ripping off Medicare.

Such an exclusion is the equivalent of the death penalty. If a major drug company can’t do business with Medicare, it loses a big chunk of its business. There have been many criminal prosecutions of major health care corporations for ripping off Medicare. And many of these companies have pled guilty. But not one major health care company has been excluded from Medicare.

Why not?

Because when you read in the newspaper that a major health care company pled guilty, it’s not the parent company that pleads guilty. The prosecutor will allow a unit of the corporation that has no assets -- or even a defunct entity -- to plead guilty. And therefore that unit will be excluded from Medicare -- which doesn’t bother the parent corporation, because the unit had no business with Medicare to begin with.

Earlier, Dr. Sidney Wolfe was here and talked about the criminal prosecution of Purdue Pharma, the Stamford, Connecticut-based maker of OxyContin.

Dr. Wolfe said that the company pled guilty to pushing OxyContin by making claims that it is less addictive and less subject to abuse than other pain medications and that it continued to do so despite warnings to the contrary from doctors, the media, and members of its own sales force.

Well, Purdue Pharma -- the company that makes and markets the drug -- didn’t plead guilty. A different company -- Purdue Frederick pled guilty. Purdue Pharma actually got a non-prosecution agreement. Purdue Frederick had nothing to lose, so it pled guilty.

10. Corporate criminals don’t like to be put on probation.

Very rarely, a corporation convicted of a crime will be placed on probation. Many years ago, Consolidated Edison in New York was convicted of an environmental crime. A probation official was assigned. Employees would call him with wrongdoing. He would write reports for the judge. The company changed its ways. There was actual change within the corporation.

Corporations hate this. They hate being under the supervision of some public official, like a judge.

We need more corporate probation.

9. Corporate criminals don’t like to be charged with homicide.

Street murders occur every day in America. And they are prosecuted every day in America. Corporate homicides occur every day in America. But they are rarely prosecuted.

The last homicide prosecution brought against a major American corporation was in 1980, when a Republican Indiana prosecutor charged Ford Motor Co. with homicide for the deaths of three teenaged girls who died when their Ford Pinto caught on fire after being rear-ended in northern Indiana.

The prosecutor alleged that Ford knew that it was marketing a defective product, with a gas tank that crushed when rear ended, spilling fuel.

In the Indiana case, the girls were incinerated to death.

But Ford brought in a hot shot criminal defense lawyer who in turn hired the best friend of the judge as local counsel, and who, as a result, secured a not guilty verdict after persuading the judge to keep key evidence out of the jury room.

It’s time to crank up the corporate homicide prosecutions.

8. There are very few career prosecutors of corporate crime.

Patrick Fitzgerald is one that comes to mind. He’s the U.S. Attorney in Chicago. He put away Scooter Libby. And he’s now prosecuting the Canadian media baron Conrad Black.

7. Most corporate crime prosecutors see their jobs as a stepping stone to greater things.

Spitzer and Giuliani prosecuted corporate crime as a way to move up the political ladder. But most young prosecutors prosecute corporate crime to move into the lucrative corporate crime defense bar.

6. Most corporate criminals turn themselves into the authorities.

The vast majority of corporate criminal prosecutions are now driven by the corporations themselves. If they find something wrong, they know they can trust the prosecutor to do the right thing. They will be forced to pay a fine, maybe agree to make some internal changes.

But in this day and age, in all likelihood, they will not be forced to plead guilty.

So, better to be up front with the prosecutor and put the matter behind them. To save the hide of the corporation, they will cooperate with federal prosecutors against individual executives within the company. Individuals will be charged, the corporation will not.

5. The market doesn’t take most modern corporate criminal prosecutions seriously.

Almost universally, when a corporate crime case is settled, the stock of the company involved goes up.

Why? Because a cloud has been cleared and there is no serious consequence to the company. No structural changes in how the company does business. No monitor. No probation. Preserving corporate reputation is the name of the game.

4. The Justice Department needs to start publishing an annual Corporate Crime in the United States report.

Every year, the Justice Department puts out an annual report titled "Crime in the United States."

But by "Crime in the United States," the Justice Department means "street crime in the United States."

In the "Crime in the United States" annual report, you can read about burglary, robbery and theft.

There is little or nothing about price-fixing, corporate fraud, pollution, or public corruption.

A yearly Justice Department report on Corporate Crime in the United States is long overdue.

3. We must start asking -- which side are you on -- with the corporate criminals or against?

Most professionals in Washington work for, are paid by, or are under the control of the corporate crime lobby. Young lawyers come to town, fresh out of law school, 25 years old, and their starting salary is $160,000 a year. And they’re working for the corporate criminals.

Young lawyers graduating from the top law schools have all kinds of excuses for working for the corporate criminals -- huge debt, just going to stay a couple of years for the experience.

But the reality is, they are working for the corporate criminals.

What kind of respect should we give them? Especially since they have many options other than working for the corporate criminals.

Time to dust off that age-old question -- which side are you on? (For young lawyers out there considering other options, check out Alan Morrison’s new book, Beyond the Big Firm: Profiles of Lawyers Who Want Something More.)

2. We need a 911 number for the American people to dial to report corporate crime and violence.

If you want to report street crime and violence, call 911.

But what number do you call if you want to report corporate crime and violence?

We propose 611.

Call 611 to report corporate crime and violence.

We need a national number where people can pick up the phone and report the corporate criminals in our midst.

What triggered this thought?

We attended the press conference at the Justice Department the other day announcing the indictment of Congressman William Jefferson (D-Louisiana).

Jefferson was the first U.S. official charged with violating the Foreign Corrupt Practices Act.

Federal officials alleged that Jefferson was both on the giving and receiving ends of bribe payments.

On the receiving end, he took $100,000 in cash -- $90,000 of it was stuffed into his freezer in Washington, D.C.

The $90,000 was separated in $10,000 increments, wrapped in aluminum foil, and concealed inside various frozen food containers.

At the press conference announcing the indictment, after various federal officials made their case before the cameras, up to the mike came Joe Persichini, assistant director of the Washington field office of the FBI.

"To the American people, I ask you, take time," Persichini said. "Read this charging document line by line, scheme by scheme, count by count. This case is about greed, power and arrogance."

"Everyone is entitled to honest and ethical public service," Persichini continued. "We as leaders standing here today cannot do it alone. We need the public’s help. The amount of corruption is dependent on what the public with allow.

Again, the amount of corruption is dependent on what the public will allow."

“"f you have knowledge of, if you’ve been confronted with or you are participating, I ask that you contact your local FBI office or you call the Washington Field Office of the FBI at 202.278.2000. Thank you very much."

Shorten the number -- make it 611.

1. And the number one thing you should know about corporate crime?

Everyone is deserving of justice. So, question, debate, strategize, yes.

But if God-forbid you too are victimized by a corporate criminal, you too will demand justice.

We need a more beefed up, more effective justice system to deal with the corporate criminals in our midst.

The 10 Worst Corporations of 2004

It is never easy choosing the 10 Worst Corporations of the Year – there are always more deserving nominees than we can possibly recognize. One of the greatest challenges facing the judges is the directive not to select repeat recipients from last year's 10 Worst designation.

The no-repeat rule forbids otherwise-deserving companies – like Bayer, Boeing, Clear Channel and Halliburton – from returning to the 10 Worst list in 2004.

Of the remaining pool of price gougers, polluters, union-busters, dictator-coddlers, fraudsters, poisoners, deceivers and general miscreants, we chose the following – presented in alphabetical order – as the 10 Worst Corporations of 2004:

Abbott Laboratories: Drug-Pricing Chutzpah

Chutzpah. Webster's defines the Yiddish term now incorporated into English slang as: 1. unmitigated effrontery or impudence; gall. 2. audacity; nerve.

In the next edition, they may want to add: 3. See Abbott.

In December 2003, the company raised the U.S. price of its anti-AIDS drug Norvir (generic name ritanovir) by 400 percent. That is, unless the product is used in conjunction with other Abbott products – in which case the price increase is zero.

Norvir has become an increasingly important treatment in recent years. Scientists have discovered that while Norvir is generally too toxic for safe use as a protease inhibitor (one category of anti-AIDS drugs), in lower doses it works well as a booster to increase the efficacy of other protease inhibitors. As a result, Norvir is frequently prescribed along with other protease inhibitors.

The Norvir price increase does not apply when the product is used as a booster with another Abbott protease inhibitor (in the combined product Kaletra). Thus the impact of the Norvir price increase is to make Kaletra far cheaper than rival combinations of Norvir and non-Abbott protease inhibitors.

Norvir is especially important for patients in need of a "salvage therapy" of new and powerful treatments because their virus has become resistant to other medicines.

Lynda Dee, co-chair of the AIDS Treatment Activists Coalition's Drug Development Committee, called the price increase for these patients, who may have no choice as to the medications they need to survive, "pharma-terrorism perpetrated against the patients who need new drugs the most."

Abbott said the price spike was justified by its need to raise money for research and development. "New medicines cost hundreds of millions of dollars to develop," Jeffrey Leiden, president and chief operating officer of Abbott's Pharmaceutical Products Group, told a National Institutes of Health meeting in May.

Moreover, Leiden said, the price increase would not deny any patients access to the drug. The price increase does not apply to federal AIDS drug programs, which cover 54 percent of people with HIV/AIDS. Price increases only apply to private insurers and to uninsured individuals, who Abbott says can get the product for free under a special program it operates.

Making the Abbott price jump especially pernicious in the eyes of consumer advocates was that the drug was invented on a grant from the U.S. federal government.

Because of the U.S. government's financing role, Essential Inventions, Inc., a nonprofit corporation created to distribute affordable public health and other inventions, in January petitioned the government to exercise its "march-in" rights under the federal Bayh-Dole Act and issue an open license to generic firms to produce their own version of Norvir.

"Essential Inventions is asking the Bush administration to adopt a simple rule – U.S. consumers should not pay more for drugs invented on government grants," said Essential Inventions president James Love. Following the U.S.-only price increase, Norvir is 5 to 10 times more expensive in the United States than in other high-income countries.

But NIH rejected the Essential Inventions proposal, arguing that companies that obtained licenses to government-funded inventions have a duty only to commercialize the inventions. NIH does not have authority to consider the price at which a product is sold and the impact of the price on access, the agency ruled – even though the Bayh-Dole Act says government-funded inventions should be made "available to the public on reasonable terms."

"If Secretary Thompson agrees that quadrupling the price of a life-or-death AIDS drug, rigging the market, and discriminating against U.S. consumers is 'reasonable,' you can't help but wonder what the [s]ecretary considers unreasonable," said Rep. Sherrod Brown, D-Ohio, in criticizing the NIH decision.

AIG: Deferred Prosecutions On the Rise

When the world's largest insurer, American International Group Inc. (AIG), was charged by federal prosecutors with crimes in November, it quickly cut a deal with the Justice Department that ended a criminal probe into its finances with a deferred prosecution agreement.

In a deferred prosecution, the corporation accepts responsibility, agrees not to contest the charges, agrees to cooperate, usually pays a fine and implements changes in corporate structure and governance to prevent future wrongdoing.

If the company abides by the agreement for a period of time, then the prosecutors will drop the criminal charges.

In a non-prosecution agreement – like the one secured by Merrill Lynch's in 2003 with New York Attorney General Eliot Spitzer – prosecutors agree not to bring criminal charges in exchange for corporate fines, cooperation and a change in corporate structure and governance.

"This comprehensive settlement brings finality to the claims raised by the SEC and the Department of Justice," said AIG Chair M. R. Greenberg. "The role of the independent consultant complements our own transaction review processes. We welcome this enhancement to our overall risk management and control mechanisms."

Under the deal with AIG, an AIG subsidiary was charged with a crime for the next 12 months, but then the charge will be dismissed with prejudice – if AIG abides by the deferred prosecution agreement.

As part of the agreement, AIG and two subsidiaries will pay an $80 million penalty, and $46 million into a disgorgement fund maintained by the SEC.

Federal officials in October filed a criminal complaint charging AIG-FP PAGIC Equity Holding Corp., a subsidiary of AIG, with violating the federal securities laws, by aiding and abetting PNC Financial Services Group, Inc. (PNC) in connection with a fraudulent transaction to transfer $750 million in mostly troubled loans and venture capital investments from subsidiaries off of its books.

These transactions were previously the subject of a deferred criminal disposition involving PNC.

Earlier this year, the Department dismissed the criminal complaint against a PNC subsidiary, after the company fulfilled its deferred prosecution agreement obligations.

Merrill, AIG and PNC are three of 10 major corporations that have settled serious criminal charges with deferred prosecution, no prosecution or de facto no prosecution agreements over the last two years. Companies are getting off the criminal hook with these agreements, which were originally intended for minor street crimes. Now they are being used in very serious corporate crime cases.

If a crime has been committed – and there is little doubt that crimes have been committed by the corporations in these cases – then the companies should plead guilty and pay the penalty. If prosecutors want to impose change on the corporation, they can do this after securing a conviction through probationary orders. Right now, corporate lawyers are teaming up with prosecutors to go after individual executives while the company's record is wiped clean.

Coca-Cola: KillerCoke.org vs. CokeKills.org

On KillerCoke.org, you'll find a raft of information on Coke and its bottlers' operations in Colombia. There is extensive documentation of rampant violence committed against Coke's unionized workforce by paramilitary forces, and powerful claims of the company's complicity in the violence.

An April 2004 report from a fact-finding delegation headed by New York City Council member Hiram Monserrate contends:

"To date, there have been a total of 179 major human rights violations of Coca-Cola's workers, including nine murders. Family members of union activists have been abducted and tortured. Union members have been fired for attending union meetings. The company has pressured workers to resign their union membership and contractual rights, and fired workers who refused to do so."

"Most troubling to the delegation were the persistent allegations that paramilitary violence against workers was done with the knowledge of and likely under the direction of company managers."

Allegations such as these formed the basis of a lawsuit filed in 2001 by the International Labor Rights Fund and the United Steelworkers of America in U.S. courts against Coke on behalf of a Colombian trade union and union leader victims of violence at Coke bottling facilities in Colombia.

In 2003, a federal court dismissed the claims against Coke, arguing that its relationship with the owners of the Coke bottling plant in Colombia was too attenuated to hold the soft drink multinational responsible for human rights abuses at the plant. The plaintiffs have since refiled their complaint – they argue the original decision was mistaken, but that Coke's subsequent purchase of the Colombia bottlers means the company is now clearly responsible for the bottlers' actions.

Strangely, for the response to KillerCoke.org, you can check out CokeKills.org. That site, which is operated by Coke, redirects you to CokeFacts.org.

Here's what Coke has to say:

"The pervasive violence in Colombia, and the targeting of union members by its perpetrators, has, unfortunately, touched The Coca-Cola Company in a very personal way. Employees of our Company and bottling partners in Colombia have been threatened, kidnapped, and some have even been murdered ... In a lawsuit in Colombia, the court concluded that the bottler not only took proper steps to initiate investigation by the authorities, but went further to enhance its workers' safety by heightening security at the plant."

Leave aside for the moment the issue of Coke's legal liability. The idea that Coke can't control the behavior of its bottlers is simply implausible. It can control them if it so chooses – just the way that clothing retailers can control the actions of their manufacturers, but even more so.

Instructive in raising questions about Coke's good-faith concern for its workers is its unwillingness to support an independent investigation into the Colombia allegations – even after the company's former General Counsel, and the former assistant U.S. attorney general, Deval Patrick, had committed to one. Coke's refusal to authorize an investigation reportedly contributed to Patrick's decision to resign from the corporation.

Dow Chemical: Forgive Us Our Trespasses

At midnight on Dec. 2, 1984, 27 tons of lethal gases leaked from Union Carbide's pesticide factory in Bhopal, India, immediately killing an estimated 8,000 people and poisoning thousands of others.

Today in Bhopal, at least 150,000 people, including children born to parents who survived the disaster, are suffering from exposure-related health effects such as cancer, neurological damage, chaotic menstrual cycles and mental illness. Over 20,000 people are forced to drink water with unsafe levels of mercury, carbon tetrachloride and other persistent organic pollutants and heavy metals.

Activists from around the world – including human rights, legal, environmental health and other experts – mobilized this year to demand that Dow Chemical, the current owner of Union Carbide, be held accountable.

Twenty years after this disaster, the company responsible for this catastrophe and its former executives are still fugitives from justice. Union Carbide and its former chairman, Warren Andersen, were charged with manslaughter for the deaths at Bhopal, but they refuse to appear before the Indian courts.

Here is part of Dow's statement on Bhopal:

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The 10 Worst Corporations of 2003

2003 was not a year of garden variety corporate wrongdoing. No, the sheer variety, reach and intricacy of corporate schemes, scandal and crimes were spellbinding. Not an easy year to pick the 10 worst companies, for sure.

But Multinational Monitor magazine cannot be deterred by such complications. And so, here follows, in alphabetical order, our list for Multinational Monitor of the 10 worst corporations of 2003.

Bayer: 2003 may be remembered as the year of the headache at Bayer. In May, the company agreed to plead guilty to a criminal count and pay more than $250 million to resolve allegations that it denied Medicaid discounts to which it was entitled. The company was beleaguered with litigation related to its anti-cholesterol drug Baycol. Bayer pulled the drug – which has been linked to a sometimes fatal muscle disorder – from the market, but is facing thousands of suits from patients who allege they were harmed by the drug. In June, the New York Times reported on internal company memos which appear to show that the company continued to promote the drug even as its own analysis had revealed the dangers of the product. Bayer denies the allegations.

Boeing: In one of the grandest schemes of corporate welfare in recent memory, Boeing engineered a deal whereby the Pentagon would lease tanker planes – 767s that refuel fighter planes in the air – from Boeing. The pricetag of $27.6 billion was billions more than the cost of simply buying the planes. The deal may unravel, though, because the company in November fired for wrongdoing both the employee that negotiated the contract for Boeing (the company's chief financial officer), and the employee that negotiated the contract for the government. How could Boeing fire a Pentagon employee? Simple. She was no longer a Pentagon employee. Boeing had hired her shortly after the company clinched the deal.

Brighthouse: A new-agey advertising/consulting/ strategic advice company, Brighthouse's claim to infamy is its Neurostrategies Institute, which undertakes research to see how the brain responds to advertising campaigns. In a cutting-edge effort to extend and sharpen the commercial reach in ways never previously before possible, the institute is using MRIs to monitor activity in people's brains triggered by advertisements.

Clear Channel: The radio behemoth Clear Channel specializes in consuming or squashing locally owned radio stations, imposing a homogenized music play list on once interesting stations, and offering cultural support for U.S. imperial adventures. It has also compiled a record of "repeated law-breaking," according to our colleage Jim Donahue, violating the law – including prohibitions on deceptive advertising and on broadcasting conversations without obtaining permission of the second party to the conversation – on 36 separate occasions over the previous three years.

Diebold: A North Canton, Ohio-based company that is one of the largest U.S. voting machine manufacturers, and an aggressive peddler of its electronic voting machines, Diebold has managed to demonstrate that it fails any reasonable test of qualifications for involvement with the voting process. Its CEO has worked as a major fundraiser for President George Bush. Computer experts revealed serious flaws in its voting technology, and activists showed how careless it was with confidential information. And it threatened lawsuits against activists who published on the Internet documents from the company showing its failures.

Halliburton: Now the owner of the company which initially drafted plans for privatization of U.S. military functions – plans drafted during the Bush I administration when current Vice President and former Halliburton CEO Dick Cheney was Secretary of Defense – Halliburton is pulling in billions in revenues for contract work – providing logistical support ranging from oil to food – in Iraq. Tens of millions, at least, appear to be overcharges. Some analysts say the charges for oil provision amount to "highway robbery."

HealthSouth: Fifteen of its top executives have pled guilty in connection with a multi-billion dollar scheme to defraud investors, the public and the U.S. government about the company's financial condition. The founder and CEO of the company that runs a network of outpatient surgery, diagnostic imagery and rehabilitative healthcare centers, Richard Scrushy, is fighting the charges. But thanks to the slick maneuvering of attorney Bob Bennett, it appears the company itself will get off scot free – no indictments, no pleas, no fines, no probation.

Inamed: The California-based company sought Food and Drug Administration approval for silicone breast implants, even though it was not able to present long-term safety data – the very thing that led the FDA to restrict sales of silicone implants a decade ago. In light of what remains unknown and what is known about the implants' effects – including painful breast hardening which can lead to deformity, and very high rupture rates – the FDA in January 2004 denied Inamed's application for marketing approval.

Merrill Lynch: This company keeps messing up. Fresh off of a $100 million fine levied because analysts were recommending stocks that they trashed in private e-mails, the company saw three former execs indicted for shady dealings with Enron. The company itself managed to escape with something less than a slap on the wrist – no prosecution in exchange for "oversight."

Safeway: One of the largest U.S. grocery chains, Safeway is leading the charge to demand givebacks from striking and locked out grocery workers in Southern California. Along with Albertsons and Ralphs (Kroger's), Safeway's Vons and Pavilion stores are asking employees to start paying for a major chunk of their health insurance. Under the company's proposals, workers and their families will lose $4,000 to $6,000 a year in health insurance benefits.

Russell Mokhiber is editor of the Washington, D.C.-based Corporate Crime Reporter. Robert Weissman is editor of the Washington, D.C.-based Multinational Monitor.

The Unbalanced Hawks at the Washington Post

What is going on at the Washington Post?

We would say that the Post editorial pages have become an outpost of the Defense Department -- except that there is probably more dissent about the pending war in Iraq in the Pentagon than there is on the Post editorial pages.

In February alone, the Post editorialized nine times in favor of war, the last of those a full two columns of text, arguing against the considerable critical reader response the page had received for pounding the drums of war.

Over the six-month period from September through February, the leading newspaper in the nation's capital has editorialized 26 times in favor of war. It has sometimes been critical of the Bush administration, it has sometimes commented on developments in the drive to war without offering an opinion on the case for war itself, but it has never offered a peep against military action in Iraq.

The op-ed page, which might offer some balance, has also been heavily slanted in favor of war.

In February, the Post op-ed page ran 34 columns that took a position on the war: 24 favored war and 10 were opposed, at least in part. (Another 22 mentioned Iraq, and sometimes were focused exclusively on Iraq, but didn't clearly take a position for or against the war.)

Over the last four months, the Post has run 46 op-ed pieces favoring the war, and only 21 opposed.

This constitutes a significant change from September and October, when the opinion pieces were much more balanced, and even tilted slightly in favor of peace.

A few words on our methodology: We reviewed every editorial and op-ed piece in the Post over the last six months that contained the word "Iraq." We looked at the substance of the articles, and did not pre-judge based on the author. We categorized as neutral pieces which mentioned Iraq as an aside, or which discussed the war without taking a position. For example, an article which assesses how European countries are responding to U.S. Iraq-related proposals, but does not take a position on the war itself, is categorized as neutral. Neutral articles are not included in our tally.

The methodology tends to undercount pro-war columns. We categorized as neutral articles which we thought presumed a certain position on the war, but which did not explicitly articulate it. Over the last four months, there were 17 "neutral" articles which we believe had a pro-war slant, and only five "neutral" pieces with an anti-war orientation.

Our methodology also tended to overcount pro-peace op-eds. We tallied an op-ed as pro-peace if it took a position opposing the drive to war on the issue of the moment -- even if the author made clear that they favored war on slightly different terms than the President proposed at the time (for example, if UN authorization was obtained).

Someone else reviewing the Post editorial page might disagree with our categorization of this or that article. We concede it may be rough around the edges. But overall, we think other reviewers would agree that our count is in the ballpark, and tends to underestimate the disparity between pro- and anti-war pieces.

Moreover, the dramatic quantitative tilt in favor of the war if anything underplays how pro-war the Post's editorial pages have been.

Among the regular columnists at the Post, those providing pieces that we considered anti-war include E.J. Dionne, a self-described "doubter" not opponent of the war, Mary McGrory, who pronounced herself convinced by Colin Powell's presentation to the United Nations (a position from which she has backtracked) and Richard Cohen, who actually is pro-war. Only William Rasberry could be labeled a genuine and consistent opponent of war.

On the other side, the regular pro-war columnists are extraordinarily harsh and shrill. George Will labeled David Bonior and James McDermott, two congresspeople who visited Iraq, "American collaborators" with and "useful idiots" for Saddam. Michael Kelly, in one of his calmer moments, says no "serious" person can argue the case for peace. Charles Krauthammer says that those who call for UN authorization of U.S. military action in Iraq are guilty of a "kind of moral idiocy."

The Post op-ed page has been full of attacks on anti-war protesters. Richard Cohen has managed to author attacks on John Le Carre, for an anti-war column he wrote, poets against the war, and Representative Dennis Kucinich. Cohen joined war-monger Richard Perle in calling Kucinich a "liar" (or at very least a "fool"), because Kucinich suggested the war might be motivated in part by a U.S. interest in Iraqi oil. (Is this really a controversial claim? Pro-war New York Times columnist Thomas Friedman says that to deny a U.S. war in Iraq is partly about oil is "laughable.")

Neither Le Carre, the poets, nor Kucinich has been given space on the Post op-ed page.

Indeed, virtually no one who could be considered part of the peace movement has been given space. The only exceptions: A column by Hank Perritt, then a Democratic congressional candidate from Illinois, appeared in September. Morton Halperin argued the case for containment over war in February. And Reverend Bob Edgar, a former member of Congress who now heads the National Council of Churches, a key mover in the anti-war movement, was permitted a short piece that appeared in the week between Christmas and New Year's, when readership and attention to serious issues is at a lowpoint.

Edgar only was given the slot after editorial page editor Fred Hiatt, in an op-ed, characterized the anti-war movement, and Edgar by name, as "Saddam's lawyers."

Does this shockingly one-sided treatment on the Post editorial pages of the major issue of the day matter?

It matters a lot.

The Washington Post and the New York Times are the two papers that most fundamentally set the boundaries for legitimate opinion in Washington, D.C. The extraordinary tilt for war in the Post editorial pages in the last four months makes it harder for officialdom in Washington and the Establishment generally to speak out against war.

Everyone who might be characterized as an "insider" in the political-military-corporate establishment knows there are major internal divisions on the prospect of war among elder statesmen, retired military brass and present-day corporate CEOs. There are many reasons those voices are inhibited from speaking out, but the Post's extremist editorial pages are certainly a real contributor.

The failure to give a prominent platform to anti-war voices has also worked to soften the debate among the citizenry. It's no answer to say a vibrant anti-war movement, reliant on the Internet, its own communications channels and dissenting voices in other major media outlets, has sprung up. Sending out an e-mail missive is not exactly the same thing as publishing an op-ed in the Washington Post.

The Post editorial page editors have failed to fulfill their duty to democracy. The heavy slant on the editorial pages, the extreme pro-war rhetoric offset only by hedging and uncertain war critics, and the scurrilous attacks on the anti-war movement to which minimal response has been permitted -- all have undermined rather than fueled a robust national debate.

At this point, there is no real way for the Post to rectify its wrongdoing. It could start to mitigate the effect by immediately making a conscious effort to solicit and publish a disproportionately high number of pro-peace op-eds, and to let the peace movement occasionally speak for itself, especially since the paper's regular columnists so savagely and repeatedly attack it.

Unfortunately, the drive to war, which the Post editorial pages have helped fuel, may not stop in Iraq. There is good reason to believe that a war with Iraq will be followed by calls from the hawks at the Post and around the administration for more military action, against some other target. Will the paper's editorial page editors find a better way to achieve balance in advance of the next military buildup? Or are the paper's editorial pages now simply devoted to the Permanent War Campaign?

Russell Mokhiber is editor of the Washington, D.C.-based Corporate Crime Reporter. Robert Weissman is editor of the Washington, D.C.-based Multinational Monitor, multinationalmonitor.org. They are co-authors of Corporate Predators: The Hunt for MegaProfits and the Attack on Democracy (Monroe, Maine: Common Courage Press; corporatepredators.org.

The New American Filter

Here's a good bet: Young, good-looking, hip and upcoming policy wonks aren't going to bite the hands that feed them.

If a public policy group holds a conference or a press briefing in Washington, D.C. that is sponsored by big corporations, then the discussion will barely mention big corporations, their role in causing the problems, or solutions that might adversely affect those big corporations.

You can take it to the bank.

Case in point:

This week, at the National Press Club, the Atlantic Monthly Magazine and The New America Foundation co-sponsored an event titled, "What is the Real State of the Union?"

In the materials is a copy of the January/February issue of The Atlantic Monthly, hot off the press.

The magazine and the Foundation got together 14 hot New America Foundation fellows and asked them to think anew and write about problems facing the nation.

So, for example, we get Jerediah Purdy on Trust (too much trust can actually be a bad thing -- a polity of suckers is no better than a nation of cynics); Shannon Brownlee on Health Care (one of our biggest health care problems is that there's just too much health care -- cutting down on the excess could save enough to cover everyone who is now uninsured); Margaret Talbot on Crime (the inevitable consequence of America's high incarceration rate is a high prison-release rate -- and the prisoners getting out are often more violent and anti-social than they were before); and Welfare and Poverty (it may be the greatest policy achievement in recent history -- over the past decade significant numbers of formerly welfare dependent black women have successfully entered the work force. But what about black men?).

Along with the materials, is a one-page note from Ted Halstead, the president of the New America Foundation, and Elizabeth Baker Keffer, the publisher of the Atlantic Monthly.

"We close with a note of thanks to each of our advertising partners and their support of our effort to create a platform for thoughtful dialogue about the true state of our union. In particular, we recognize: Shell, Lockheed Martin, ADM, TIAA-CREF, Microsoft, The Hartford, Hewlett Packard, and the Nuclear Energy Institute."

The event at the press club was an all day affair. And by the early afternoon session, there was hardly a mention of the C word -- corporations.

This seemed to us to be a simple case of the rule: Don't bite the hand that feeds you. And they didn't.

One of the afternoon sessions was moderated by Jim Fallows, national correspondent for the Atlantic Monthly and chairman of the New America Foundation. One of the panelists during that session was Senator John Breaux (D-Louisiana).

The senator, apparently oblivious to a banner hanging behind him prominently featuring the corporate logo of the conference sponsors, including the yellow seashell of Royal Dutch Shell, begins to tell a story about the debate over drilling in the Arctic National Wildlife Refuge, how he argued that drilling would do minimal damage to the environment, how other Democratic senators would come up to him and in private say they agreed with him, but couldn't side with him in public because of the "interest groups" -- read environmental groups.

Yes, interest groups were the problem.

They get in the way of reasonable compromise, Breaux said.

During the question period, Fallows calls on us.

Well, isn't it interesting, we observe, that Senator Breaux totally ignored the interest groups that are sponsoring the conference.

I mean, there is the Shell Oil corporate logo glowing over the senator's left shoulder, and all he can talk about are the environmental groups, as if the oil companies have no say in the matter?

Who are we kidding here?

And isn't the senator's failure to recognize the elephant in the room symptomatic of the entire effort?

Here you have The New America Foundation and the Atlantic Monthly taking money from Shell, and ADM, and Lockheed Martin, The Hartford, and the Nuclear Energy Institute to write about the real state of the union, and you ignore corporate power -- just don't talk about it?

At this point, one of the young New America kids takes the microphone from our hands and won't hand it back.

We pry it from his hands and continue to address Fallows.

In the essay about crime, why do you write nothing about corporate crime and focus solely on street crime, ignoring that corporate crime and violence inflicts far more damage on society than all street crime combined?

And in the essay on welfare, why do you focus solely on black Americans, and ignore corporate welfare, which costs more than all individual welfare combined?

And Fallows' answer is -- well, to run a magazine, you can't rely on subscription income alone.

Well, yeah, but you don't have to totally ignore the subject of corporate power, either.

And you don't have to give free advertising to your advertisers by ordering a banner with their corporate logos emblazoned across the bottom, to be beamed across national television via C-Span.

And we give up the mike.

And then, Michael Lind, a New America fellow, comes up to us and says had we read his article (on National Unity -- overcrowded cities on the coasts; dying rural communities in the interior; the way to save both may be to create a post-agrarian heartland) -- we would have known that he in fact calls for a cutback on agricultural subsidies and we wouldn't have asked this "stupid question."

In fact, Michael, it was not a stupid question.

Just because you had a throwaway line on cutting agricultural subsidies, that doesn't mean the issue of corporate power, corporate crime and corporate welfare has been addressed.

New America scholars are young, hip and with it.

The Economist says they are "the brightest American thinkers under 40."

The New York Times says they "break out of the traditional liberal and conservative categories."

The Washington Post calls the New America Foundation "The think tank for Generation Next."

Looks more like they are bought and paid for.

And in exchange, they filter out any discussion of corporate power.

Call it the New American Filter.

Russell Mokhiber is editor of the Washington, D.C.-based Corporate Crime Reporter. Robert Weissman is editor of the Washington, D.C.-based Multinational Monitor. They are co-authors of "Corporate Predators: The Hunt for MegaProfits and the Attack on Democracy."

The 10 Worst Corporations of 2002

The year 2002 will forever be remembered as the year of corporate crime, the year even President George W. Bush embraced the notion of "corporate responsibility."

While the Bush White House has now downgraded its "corporate responsibility portal" to a mere link to uninspiring content on the White House webpage, and although the prospect of war has largely bumped the issue off the front pages, the cascade of corporate financial and accounting scandals continues.

We easily could have filled Multinational Monitor's list of the 10 Worst Corporations of the Year with some of the dozens of companies embroiled in the financial scandals. But we decided against that course. As extraordinary as the financial misconduct has been, we didn't want to contribute to the perception that corporate wrongdoing in 2002 was limited to the financial misdeeds arena.

We included only Andersen from the ranks of the financial criminals and miscreants. Andersen's assembly line document destruction certainly merits a place on the list. (Citigroup appears on the list as well, but primarily for a subsidiary's involvement in predatory lending, as well as the company's funding of environmentally destructive projects around the world.)

As for the rest, we present a collection of polluters, dangerous pill peddlers, modern-day mercenaries, enablers of human rights abuses, merchants of death, and beneficiaries of rural destruction and misery.

Appearing in alphabetical order, the 10 worst are:

Arthur Andersen, for a massive scheme to destroy documents related to the Enron meltdown. "Tons of paper relating to the Enron audit were promptly shredded as part of the orchestrated document destruction," a federal indictment against Andersen alleged. "The shredder at the Andersen office at the Enron building was used virtually constantly and, to handle the overload, dozens of large trunks filled with Enron documents were sent to Andersen's main Houston office to be shredded." Andersen was convicted for illegal document destruction, effectively putting the company out of business.

British American Tobacco (BAT), for operating worldwide programs supposedly designed to prevent youth smoking but which actually make the practice more attractive to kids (by suggesting smoking is an adult activity), continuing to deny the harmful health effects of second-hand smoke, and working to oppose efforts at the World Health Organization to adopt a strong Framework Convention on Tobacco Control.

Caterpillar, for selling bulldozers to the Israeli Defense Forces (IDF), which are used as an instrument of war to destroy Palestinian homes and buildings. The IDF has destroyed more than 7,000 Palestinian homes since the beginning of the Israeli occupation in 1967, leaving 30,000 people homeless.

Citigroup, both for its deep involvement in the Enron and other financial scandals and its predatory lending practices through its recently acquired subsidiary The Associates. Citigroup paid $215 million to resolve Federal Trade Commission (FTC) charges that The Associates engaged in systematic and widespread deceptive and abusive lending practices.

DynCorp, a controversial private firm that subcontracts military services with the Defense Department, for flying planes that spray herbicides on coca crops in Colombia. Farmers on the ground allege that the herbicides are killing their legal crops, and exposing them to dangerous toxins.

M&M/Mars, for responding tepidly to revelations about child slaves in the West African fields where much of the world's cocoa is grown, and refusing to commit to purchase a modest 5 percent of its product from Fair Trade providers.

Procter & Gamble, the maker of Folger's coffee and part of the coffee roaster oligopoly, for failing to take action to address plummeting coffee bean prices. Low prices have pushed tens of thousands of farmers in Central America, Ethiopia, Uganda and elsewhere to the edge of survival, or destroyed their livelihoods altogether.

Schering Plough, for a series of scandals, most prominently allegation of repeated failure over recent years to fix problems in manufacturing dozens of drugs at four of its facilities in New Jersey and Puerto Rico. Schering paid $500 million to settle the case with the Food and Drug Administration.

Shell Oil, for continuing business as usual as one of the world's leading environmental violators -- while marketing itself as a socially and environmentally responsible company.

Wyeth, for using duplicitous means, and without sufficient scientific proof, to market hormone replacement therapy (HRT) to women as a fountain of youth. Scientific evidence reported in 2002 showed that long-term HRT actually threatens women's lives, by increasing the risks of breast cancer, heart attack, stroke and pulmonary embolism.

What's the lesson to draw from this year's 10 worst list? Not only are Enron, WorldCom, Adelphia, Tyco and the rest indicative of a fundamentally corrupt financial system, they are representative of a rotten system of corporate dominance.

Russell Mokhiber is editor of the Washington, D.C.-based Corporate Crime Reporter. Robert Weissman is editor of the Multinational Monito, also based in D.C.

Of Caviar and Capitalism

Are capitalism and caviar incompatible? Is the system that prides itself on the creation and veneration of wealth unable to to maintain a sustainable market for one of the great trappings of wealth?

Well, at the very least, the tragic story of the global caviar industry gives pause. It stands as a parable illustrating the pitfalls of the market fundamentalist ideology that has dominated global economic policy-making for two decades.

The story of the industry is recounted in a new book by Inga Saffron, a Philadelphia Inquirer reporter and former Moscow correspondent for the paper, "Caviar: The Strange History and Uncertain Future of the World's Most Coveted Delicacy" (New York: Broadway Books).

For most of the twentieth century, the world caviar market was supplied primarily by the Soviet Union. Caviar -- the salted eggs of sturgeon or paddlefish -- is a creation of Russian culture. Although sturgeon once populated many of the world's great seas and rivers in large numbers, most of the world's supply after World War I came from the Caspian Sea and the Black Sea.

After coming to power, Saffron says, "the Soviets realized they could make a lot of money if they controlled the caviar market."

They exported the product to Western markets to earn hard currency, but limited supply to increase prices.

"I don't want to say that they had a great environmental record, because they didn't," Saffron says. "But they did act as a brake on fishing because they limited caviar exports."

Even when the Soviets embarked on their disastrous dam-building schemes, which blocked sturgeon from swimming upstream to spawn, they developed an extensive hatchery system that maintained the sturgeon population.

Communism, it turned out, was pretty good for caviar.

When the Soviet Union collapsed, so did the protections and support system for caviar.

In the chaos following the fall of the Soviet Union, factories across the country stopped doing business as government money for operating expenses evaporated. Funding to maintain the hatcheries similarly disappeared, and the hatchery system fell apart. Overall, Saffron says, the hatchery system became much less efficient, and was able to put back many fewer fish than it had before.

Even worse, perhaps, was the rampant poaching that occurred after the fall of the USSR.

"Many of the people who had been thrown out of work began to fish illegally," according to Saffron. "They began to poach for sturgeon and make caviar in their kitchens, because that is the only way they could make money. It was the one resource in Southern Russia."

The old Soviet limits on fishing "were ignored, and people just fished all the time," she says.

Enforcement agencies were weak and ineffectual. Many were bought off or intimidated by the criminal gangs that gained control over much of the industry.

Today, the sturgeon in the Russian and Kazakhstan portions of the Caspian are in steep decline, and Saffron has little hope that they will be saved. International controls on caviar imports are coming too little, too late, and in any case cannot stop the internal traffic in the delicacy.

The collapse of the sturgeon in the Russian and Kazakhstan portions of the Caspian is history repeating itself. Rampant overfishing led to the rapid destruction of sturgeon populations in Germany, France, the Eastern United States and the U.S. Great Lakes, all in a matter of decades in the late nineteenth and early twentieth centuries.

Today, the counterexample to the laissez-faire caviar failure is Iran. Like the Soviet Union once did, Iran maintains strong limits on fish catch in its portion of the Caspian and operates a sophisticated and effective hatchery system.

Countries relying only on price signals to regulate the industry have witnessed a short cycle of boom and bust.

Countries that have succeeded in maintaining a viable caviar industry over time have made long-term investments in infrastructure and put in place systems to ensure sustainable management of limited resources.

Those are key elements for effective economic management and a livable world.

Markets alone will not deliver them.

Russell Mokhiber is editor of the Washington, D.C.-based Corporate Crime Reporter. Robert Weissman is editor of the Washington, D.C.-based Multinational Monitor, http://www.multinationalmonitor.org. They are co-authors of Corporate Predators: The Hunt for MegaProfits and the Attack on Democracy (Monroe, Maine: Common Courage Press, 1999; http://www.corporatepredators.org).

Why Newsweek is Bad for Kids

Did you see the cover story of Newsweek magazine last week?

The cover story is titled, "Why TV is Good for Kids."

What are we to expect from Newsweek next week?

Why Soda Pop is Good for Kids.

Why Sedentary Living is Good for Kids.

Why Obesity is Good for Kids.

Some things are good for kids.

Reading is good for kids.

Love and caring is good for kids.

Teaching is good for kids.

Running, playing basketball and baseball and tennis and swimming are good for kids.

But don't try and insult us by telling us that sitting in front of a TV is good for kids.

Why, against all common sense, is Newsweek going to try and convince us that television is good for kids?

Well, one reason might be: Newsweek is owned by the Washington Post Company, which owns a sprawling cable company and six broadcast stations around the country.

Of course, nowhere in the article does Newsweek tell us this.

And how does Newsweek try and convince us that TV is good for kids?

They trot out an expert, Daniel Anderson, a professor of psychology at the University of Massachusetts, who claims that TV is good for kids.

But what Newsweek doesn't tell us is Anderson is a paid consultant to a variety of television networks and advertising interests.

His clients include: NBC, CBS, Universal Pictures, Sony, General Mills, the Leo Burnett ad agency, Nickelodeon and the National Association of Broadcasters.

The article says that TV is a good thing because kids learn from television and parents are "looking for TV to help them do a better job of raising kids."

But Frank Vespe, executive director of the TV TurnOff Network (www.tvturnoff.org), points out that the article misses a crucial issue: the average American school child spends more time in front of the television each year -- about 1,023 hours -- than in the classroom -- about 900 hours.

"This amount of television -- more than twice what anyone thinks is a healthy amount -- has negative consequences for health, education, and family time," Vespe said.

This amount of television watching actually hurts children.

Vespe points to studies documenting how kids gain weight from watching TV, and that TV reinforces sex roles and stereotyping.

Voracious TV-watching kids turn into voracious TV-watching adults. The average American watches four hours a day, 1460 hours a year, about two full months, 24 hours a day, every year.

Newsweek did run a one-page counterpoint ("No It's Not") to its "TV Is Good for Kids" eight pager.

The "No It's Not" counterarticle is written by a mom who points out that the American Academy of Pediatrics recommends no television for children younger than two and a maximum of two hours a day of "screen time" -- TV, computers or videogames -- for older kids.

We rang up the author of the "Why TV Is Good for Kids" article, Daniel McGinn.

McGinn immediately points out that at the end of his article, he did write that the expert, Anderson, advised on a handful of television shows during their conception.

"People who help create television shows get paid to do so," McGinn tells us.

Well, yes, but Anderson gets paid to do much more.

According to his own bio, Anderson has been paid by NBC and by General Mills to consult "on television viewing behavior."

And he's been paid by the Leo Burnett ad agency to consult on "children's cognitive processing of television."

That's a touch more than helping to "create television shows."

We asked Newsweek's McGinn why he didn't inform his readers that Newsweek is owned by the Washington Post which owns a cable company and six broadcast news outlets.

"Newsweek is owned by the Washington Post," he says. "I'm not sure what the Washington Post owns today."

You mean you don't know that the Washington Post Company owns television outlets?

It's right on the company's web site: WDIV in Detroit, KPRC in Houston, WPLG in Miami, WKMP in Orlando, KSAT in San Antonio and WJXT in Jacksonville.

The Post also owns Cable ONE, the owner and operator of cable television systems serving subscribers across the country.

Earlier, McGinn left a message on our machine saying he was willing to talk with us "at whatever length."

At this point, though, McGinn decides the conversation has gone on long enough.

"Who do you write for?" he asks. We tell him.

"Have a great day, bud." And he hangs up.


Russell Mokhiber is editor of the Washington, D.C.-based Corporate Crime Reporter. Robert Weissman is editor of the Washington, D.C.-based Multinational Monitor, http://www.multinationalmonitor.org. They are co-authors of Corporate Predators: The Hunt for MegaProfits and the Attack on Democracy (Monroe, Maine: Common Courage Press, 1999; http://www.corporatepredators.org).

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