Monitoring Corporate Agribusiness From a Public Interest Perspective
A.V. Krebs Editor\Publisher
Issue #134 November 26 2001
CUBA READIES FOR SECOND "BAY OF PIGS" LANDING
It should come as no surprise, much less shock, that the elites of corporate agribusiness have finally succeeded in establishing an economic beachhead in Cuba after being shut out of that island country by a 40-year U.S. embargo in the wake of Fidel Castro's 1959 revolution.
These agribusiness giants have been plying Congress with "soft money" and applying political muscle for decades to ease such trade restrictions so they could be the first through the door when the U.S. embargo was ultimately lifted. Now in the name of "humanitarian relief" after the devastation caused by Hurricane Michelle they have finally got their foot solidly in the door.
Last week Archer Daniels Midland Co. (ADM), ConAgra Foods Inc. and Riceland Foods reached sale agreements with Cuba, and announced deals worth an estimated total of more than $20 million. John Kavulich, president of the U.S.-Cuba Trade and Economic Council, which monitors business with the island, said Cuba also is likely to buy poultry from Georgia-based Gold Kist, Maryland's Perdue Farms and Arkansas' Tyson Foods.
Farmer-owned Riceland Foods Inc., of Stuttgart, Arkansas and Cargill Inc., of Minneapolis. --- will sell tens of thousands of metric tons of wheat, corn, soybeans, rice, edible beans and cooking oil. Cargill said it expects to begin making deliveries in early January. Some of the sales are subject to the receipt of permits from the U.S. government. The State Department has said it would support the sales because of their "humanitarian nature."
Cargill will send 20,000 tons of wheat, 19,000 tons of corn and 5,000 tons of soybean oil to Cuba, which is rebuilding its food supplies after the recent hurricane. Cargill did not disclose financial terms, but based on current market prices, the sale is reportedly worth about $5.4 million. While that amount is relatively insignificant to Cargill, which has annual revenues of about $50 billion, the company is "hopeful" that the sale is the beginning of ongoing agricultural trade between the two nations.
Cuba is estimated to want products totaling about $30 million, of which ADM, Cargill and Riceland appear to have won the largest share.
The most prominent among those corporate agribusinesses who have long sought to open the lucrative Cuban market has been ADM and its former CEO and board chairman Dwayne O. Andreas. ADM ("The Nature Of What's to Come") says it hopes the recent deals lead to further business with Cuba as the country presently imports $1 billion of foodstuffs from farm powers such as the European Union and Canada.
As readers of THE AGRIBUSINESS EXAMINER are already aware ADM has in the past hosted officials of Cuba's state-buying agency at its Decatur headquarters, held talks with President Castro, and donated food to Cuba. Despite most of the major media's refusing to follow the money in the Elian Gonzalez story it was ADM who covertly managed that episode in its effort to curry the Cuban government's favor.
The fact was that the then six-year-old Cuban boy, who was the center of the highly publicized custody battle between his Cuban father and Cuban-American relatives in Miami, may well have been nothing but a key player in such trade and marketing efforts by ADM. Examining some of the lesser known facts of the controversy a curious pattern began to emerge highly suggesting that, in the words of Orlando Sentinel columnist Charley Reese, "little Elian Gonzalez has become a pawn in an international business scheme."
Based on research by the Archer Daniels Midland Shareholders Watch Committee in the fall of 1995, Andreas, met with Fidel Castro for dinner in New York. In July 1996, Andreas announced that he was going to Cuba to see Castro and contemplated building a refinery in Cuba, but would do it through a Spanish subsidiary because of the U.S. trade embargo.
It was then in the midst of the highly charged debate whether Elian Gonzalez should be returned to his father in Cuba or stay in Miami with relatives a meeting was arranged with the boy's grandmothers at the home of the president of Barry University. Coincidentally, Andreas is also a large contributor to Barry University, and his wife is a graduate and is past chairman of the board of trustees.
In late April the Washington Post reported that the fund paying the legal expenses for Juan Gonzalez, Elian's father, which had been coming from the United Methodist Church's Board of Church and Society was being turned over to the National Council of Churches. The Methodist announcement came after the denomination's financial office decided such fund raising did not follow rules prescribed in the Methodist policy manual.
The Methodists, through the fund, paid lawyer Gregory B. Craig and his Washington firm, Williams & Connolly, through contributions designated for representing Gonzalez only, not for denominational programs. But many of the church's 8.4 million members, the Post noted, especially Cuban American Methodists in Miami, criticized the society's involvement.
It was the politically powerful law firm of Williams & Connolly who not only represented ADM unsuccessfully in its lysine price fixing suit, but also represented President Bill Clinton in his 1999 impeachment trail before the U.S. Senate. Williams & Connolly, including Clinton's personal attorney David Kendall, has also been one among several attorneys representing FOX Television interests battling investigative reporters Jane Akre and Steve Wilson in their suit against their former employer Rupert Murdoch's FOX 13 TV station in Tampa Bay, Florida.
The couple charged that they were fired for refusing to broadcast statements which they considered to be untrue about bovine growth hormone (rBGH), manufactured by Monsanto, a major FOX advertiser. A six-person jury eventually awarded $425,000 in damages to Akre after finding enough evidence that proved FOX took retaliatory personnel action against her because she threatened to blow the whistle to the Federal Communications Commission that FOX Television pressured the husband-and-wife team to broadcast a false, distorted or slanted news report.
The origin of the National Council of Churches role in bankrolling Gonzalez's attorney Craig, who as columnist Reese noted is "the high-priced lawyer who suddenly materialized to represent Juan Gonzalez, who couldn't afford two seconds of Craig's time" might well stem from the appointment in October, 1999 of Andrew Young, a current ADM board member and member of its public-policy committee, as the new president of the National Council of Churches.
As the Agribusiness Council's Nicholas E. Hollis, observed at the time "under the Internal Revenue Service (IRS) code the tax exempt organization must report only individual donations over a certain percentage of the total revenues and only after a year --- by which time the heat of investigation and inquiring minds is gone.
"By shuffling the pea from under one shell to another, the question of who is actually financing Elian's father remains hidden --- and clouded to future investigation. This is once again the work of the Phantom Factor at his worst. The `Supermarkup to the World's' chairman emeritus must be working overtime in Miami, Washington and Decatur on this," he added.
While the U.S. should not shirk from providing "humanitarian relief" to wherever it is needed in the world one should be extremely wary when it comes to corporate agribusiness using the term to simply camouflage there attempts to develop new markets.
It was in the early 1950's that Congress enacted Public Law 480 designed to relieve U.S. grain surpluses by authorizing the sale or bartering of surpluses abroad to those countries needing food commodities. It was not until almost a decade later that the program became know as the Food for Peace program.
In naming P.L. 480 the "Food for Peace" program Minnesota Senator (and long-time Cargill friend) Hubert H. Humphrey remarked: "I have heard . . . that people may become dependent on us for food. I know that was not suppose to be good news. To me that was good news, because before people can do anything they have got to eat. And if you are looking for a way to get people to lean on you and to be dependent on you, in terms of their cooperation with you, it seems to me that food dependence would be terrific."
Since its inception, however, P.L. 480 has had its critics. Perhaps the most critical analysis of the program came in 1975 with the publication of The Fields Have Turned Brown: Four Essays on World Hunger authored by Susan DeMarco and Susan Sechler, at the time co-directors of the Agribusiness Accountability Project.
In their report they contended that "simple greed" more than generosity had
motivated the administration of a food program designed to feed hungry people.
In what amounted to a form of "economic imperialism," the USDA and the State
Department in league with the grain trade and corporate agribusiness used the
* "To dispose profitably of farm surpluses, which otherwise might create serious domestic economic problems;
* "To create new, or to expand or protect existing markets for U.S.-owner interests;
* "To provide cheap capital for overseas investment by U.S. enterprises;
* "To `launder,' so to speak, military assistance which might have been challenged if so identified."
One of the most important results of these policies the two women went on to document meticulously, was that U.S. agricultural trade policies forced a change in the eating habits of people in less developed countries and stifled their own agricultural production by making them dependent on U.S. food stuffs.
Such use of food aid as "one of the chips in the poker game of international power politics," DeMarco and Sechler explained, and "so long as the major portion of U.S. food aid is captive to overriding political and commercial concerns, it will do little to advance a goal of long-term food security for the hungry, and, more frequently, will even tend to disrupt that goal."
It has often been said if we don't learn from past mistakes we are bound to
repeat them in the future so it behooves U.S. family farmers, Cuban farmers,
national and international humanitarian groups, and the Cuban government to keep
a suspicious eye on the likes of ADM, Cargill, Riceland Foods, ConAgra, Perdue
Farms, Gold Kist, and Tyson Foods as they come bearing their corporate "gifts."
CARGILL INC. ACCUSED OF RACIAL DISCRIMINATION
IN CLASS ACTION LAW SUIT BY BLACK EMPLOYEES
REED ABELSON, THE NEW YORK TIMES: A group of 25 black employees of Cargill Inc., the agricultural business that is one of the world's largest private companies, filed a federal lawsuit . . . . accusing the company of widespread racial discrimination. The civil lawsuit, which was filed in Minneapolis, seeks class-action status on behalf of an estimated 1,000 blacks who work or have worked in salaried positions as managers or professionals in the last six years.
In their suit, the employees point to companywide evaluation systems that they contend "favor employees who 'look and talk'' like Cargill's white executives." These systems help determine pay and promotions at the company. The evaluation systems are so "poorly constructed and poorly operated," said Lawrence Schaefer, one of the lawyers representing the employees, that they place a lower value on work done by black employees. The company has only one black officer among its top 150 executives, he said. Many of the employees in the lawsuit contend that they have been denied promotions.
Della Dickson, who has worked for Cargill for more than 20 years, says the company has "failed to consider her for numerous promotions for which she expressed interest and for which she was qualified," according to the suit. Last December, for example, Cargill placed a white employee, who she contends was less qualified, in a position that she wanted. Cargill executives deny any discrimination has taken place.
"We don't have systems that discriminate, we don't have policies that discriminate and we don't have a culture that discriminates," said Robert L. Lumpkins, a vice chairman of Cargill. "We just don't do it." The 25 current and former employees suing the company represent "a wide range of circumstances," he said, including some whose performance was "objectively unsatisfactory." Cargill also defended its evaluation systems. "They are based on objective job-related criteria," said Nancy Siska, a corporate vice president.
Though Cargill would not discuss the number of black senior executives it employs, the company said there was a lot of diversity among its senior managers at roughly 90 business units in the United States and around the world. Based in Wayzata, Minn., Cargill has about 90,000 employees worldwide. .
The black employees bringing the suit contend that Cargill has had a long
tradition of discrimination. Sprenger & Lang, the law firm representing the
employees in the case filed . . . . represented black and female employees
in a similar suit that was settled in 1985 for $1.2 million. Cargill says the
company is committed to a diverse workplace. "We met all of the terms of the
agreement in 1985," Mr. Lumpkins said. "Since then, the company has invested in
a broad set of initiatives to create opportunities for minorities."
FARM FOUNDATION STUDY SAYS FARMERS
FAVOR TARGETING GOVERNMENT SUBSIDIES
TO SMALL AND MEDIUM SIZED FARMS
JAKE THOMPSON, OMAHA WORLD-HERALD: Stung by reports of big farmers raking in big government subsidies, thousands of America's farmers recently spoke out in a new poll for targeting the payments to medium- and small-sized family farm operations. But Washington apparently hasn't heard the word yet.
The House avoided the idea when it passed its version of the farm bill last
month. And while Sen. Tom Harkin has taken on the controversial issue by
proposing some limits to government checks going to large farming operations,
the Iowa Democrat expects a tough fight . . . [as] . . .
the Senate Agriculture Committee he heads [takes] up the proposal for a new
five-year farm bill. To Chuck Hassebrook, director of the Center for Rural
Affairs in Walthill, Nebraska., the poll reveals an uneasiness he's heard from
farmers for years about the size of government checks going out and how they've been used.
"Farmers want them in a way that helps family farms, but not in a way where it subsidizes mega-farmers to drive family farms out of business," Hassebrook said this week. "They wonder, `Why are we spending money to depopulate rural America?'". . . .
America's farmers seem clear on the issue. The nonprofit Farm Foundation released a survey showing 81% of farmers favor targeting government subsidies to small and medium farms. Eighty-five percent of Nebraskans and 75% of Iowans supported targeting the subsidies, which are mainly paid to farmers who grow wheat, corn, soybeans, sorghum, rice and cotton. The nonprofit foundation sent random surveys to about 70,000 farmers in 27 states and received 14,183 responses, including several thousand from Nebraska and Iowa.
Earlier this year, the General Accounting Office (GAO) reported that the
largest farms have won the lion's share of government subsidies, especially in the last four years as Congress has approved emergency bailout packages of billions of dollars to farmers and ranchers. The GAO found that farms with sales greater than $500,000 a year took in 22% of government payments in 1999. And farms with sales between $250,000 and $500,000 received 21% of the payments, the GAO found.
Defenders of the payment system say that large farms produce most of the nation's agricultural goods and that many of them support extended families. They point to census figures showing that in the United States, 8.4% of the nation's roughly two million farms sell more than $100,000 in agriculture products nationally. They also sell 72% of the nation's total agricultural products.
Mary Kay Thatcher, a lobbyist for the Farm Bureau, said she doesn't think
there's much support among Farm Bureau members for limiting payments to large
operations. The subsidies, along with the emergency aid packages, have meant a
lot in recent years to farmers' survival. Government payments have risen to the
point where 40% of farmers' net income came from Washington. That's a steep rise
from 1989, when federal subsidies contributed just 24% of farmers' net income,
said Brad Luben, one of the authors of the Farm Foundation survey. . . .
THE WEALTH OF NATIONS
AS EXPLAINED WITH TWO COWS
CARL H. GARRISON, MINIFARMS:
Socialism: You have two cows. You keep one and give one to your neighbor.
Communism: You have two cows. The government takes them both and provides you with milk.
Fascism: You have two cows. The government takes them both and sells you the milk.
Bureaucracy: You have two cows. The government takes them both, shoots one, milks the other, pays you for the milk, and then pours it down the drain.
Capitalism: You have two cows. You sell one and buy a bull.
Corporate: You have two cows. You sell one, force the other to produce the milk of four cows and then act surprised when it drops dead.
Democracy: You have two cows. The government taxes you to the point that you must sell them both in order to support a man in a foreign country who has only one cow which was a gift from your government.
IBP MUST PAY 815 PRODUCTION LINE WORKERS
$3.1 MILLION IN BACK WAGES FOR UNPAID WORK
AT ITS WALLULA, WASHINGTON PLANT
DOW JONES NEWSWIRES: A federal judge has ordered meatpacking giant IBP to pay $3.1 million to 815 current and former production line employees for unpaid work at its Washington state plant. IBP, based in Dakota Dunes, South Dakota, said it plans to appeal the ruling by U.S. District Judge Robert Whaley in Spokane. IBP was purchased by Tyson Foods of Springdale, Arkansas, in September.
The limited class-action lawsuit contended that IBP violated state and federal wage and hour laws at the plant because workers weren't paid for time spent preparing for and cleaning up after their jobs. "The company started paying the people with the first cut of meat and stopped paying with the last cut of meat," said David Mark, a Seattle lawyer who represented the workers. "And they had to do a lot of work before they were ready to cut meat and a lot of work after they finished cutting meat."
The Wallula plant in southeastern Washington has about 1,400 workers who process about 280 cows an hour. "Contrary to the claims made, we pay our team members for all of the production time worked," IBP said in a statement. "We also pay for the time they spend immediately before and after work, putting on and taking off the clothing and equipment required for their jobs. In fact, our practices have been determined by the U.S. Department of Labor to be in compliance with the Fair Labor Standards Act."
The lawsuit contended that workers routinely arrived for their production line jobs 30 to 45 minutes early and stayed another 20 minutes after their shift to remove, wash and store equipment. Mark said employees were also required to remove their contaminated work gear before lunch and then put it on afterward, all off the clock. Whaley heard the case against IBP in a bench trial a year ago. . . . The lawsuit covered a period from June 1995 until May 2000. . . . Mark and the law firm of Schroeter Goldmark & Bender in Seattle filed a second similar lawsuit that makes the same allegations for a subsequent time period and for different workers. The case has been assigned to U.S. District Judge Edward Shea in Richland.
"Most of the people who work for IBP . . . .are hardworking people," said
Maria Martinez, who worked at IBP for 12 years and helped lead a month long
wildcat strike over wages and working conditions at the plant in 1999. [See
Issue #42] "For all of us, a dollar means a lot and we should not be cheated out
of receiving fair wages for doing what is required of us at our jobs."
CORPORATION NO LONGER WANTS
TO BE CALLED PHILIP MORRIS
CATHLEEN EGAN, DOW JONES NEWSWIRES: If people were confused before, they seem downright perplexed now. Philip Morris Cos. (MO), which to many represents heritage, history and is listed among the elite group of 30 stocks that make up the Dow Jones Industrial Average, said it wants to change its name to Altria Group Inc. The purpose: To eliminate any confusion about what the corporation stands for and stress that it's not just a tobacco company that happens to operate the second-largest food business in the world and the nation's No. 2 brewer.
Wall Street, however, is confused. Besides the normal getting-used-to-change skepticism, shareholders and analysts wonder what the tangible upside is to distinguishing the company from its 150-year-old moniker. "For one thing, one of the ideas was to use Philip Morris's identity around the world to enhance the prospects of its other businesses and global markets," Goldman Sachs & Co. analyst Marc Cohen said during a conference call with the company. "It seems that that's somewhat being abandoned here."
Philip Morris disagrees, saying that switching to Altria more appropriately reflects the company's evolving business structure. For years the company has batted around the idea of changing the corporate name and logo, but it wasn't until about a year ago, in light of the Nabisco Foods acquisition and the Kraft initial public offering, that it seriously began working on the project.
"The name Philip Morris really means tobacco to people," said Steven Parrish, the company's senior vice president for corporate affairs. And while the company, he said, "has a long and proud heritage with tobacco which incidentally makes up the lion's share of corporate profits, Philip Morris represents so much more.
"Working with management, the company came up with core characteristics of the corporation --- what we think we are and what we want to be seen as: a global family of people and companies, that we are characterized by operational excellence, financial strength, consumer brand expertise and commitment to social responsibility," Parrish said during the call.
As for the risks? "Long-term, assuming the shareholders approve the name change, (the challenge will be) that we do good job positioning Altria Group Inc. for what it is and we not allow ourselves to be defined by others, which was happened over last few years," Parrish said. "So we're going to be vigilant about that and we're going to protect the equity in Altria Group Inc. and build that image for ourselves." Philip Morris will begin running related ads in newspapers across the country . . . . Shareholders will be asked to approve the new name at the company's annual meeting scheduled for April 25. No final word yet on the fate of the "MO" ticker symbol.
In interviews, shareholders' opinions ranged from not caring to slight glee that "Altria" does not easily flow off the tongues of anti-tobacco protesters The worldwide operating units --- Kraft Foods, Miller Brewing and the Philip Morris tobacco business --- would keep their respective names. Altria, which is derived from the Latin word "altus," meaning "high," would merely replace the parent company name. The company's mission would be unchanged. Even a new corporate tagline --- "Where people and performance make a difference" --- is largely similar to the one it would replace: "Working to make a difference. Philip Morris."
John McMillin, the food analyst for Prudential Securities Inc., quipped
during the call that "when my wife's name changed her behavior changed."
FIGHTING TO A DRAW IN DOHA ???
MARK RITCHIE, INSTITUTE FOR AGRICULTURE AND TRADE POLICY: Take the Ministers of Trade from 142 countries, a few hundred journalists, NGOs, and business lobbyists, tens of thousand of police and military for security, and you have the makings of one of the most surreal events in recent international diplomacy history --- the Fourth Ministerial Meeting of the World Trade Organization in Doha, Qatar. In the backdrop of September 11 and the disastrous Seattle Ministerial two years ago, the WTO set about to agree on a Ministerial declaration that would chart the work agenda for WTO negotiators for the next few years.
Leading up to the Doha meeting, there were serious conflicts between North and South governments and between the United States and Europe. As in Seattle, the U.S. and European negotiators used nearly every known form of arm-twisting, bullying and bribery to stifle Third World proposals and give the appearance of consensus. In Seattle, the process did not lead to agreement, but instead to collapse. In Doha, with the help of a one-day meeting extension, the right level of deal making and threatening led to agreement on a final Declaration.
The entire ten page Final declaration is riddled with language that allows every negotiator to go home and claim victory or at least the avoidance of defeat. Upcoming elections in Brazil, France, and the United States were key factors in a number of key public battles and behind the scene compromises. Although this meeting and the WTO are presented as part of the new global agenda, much of what is at play is parochial politics played out on the global stage.
A good example of artful word-smithing in the service of domestic politics is in the area of agriculture, where there were demands from South countries for radical reforms, including a call for the end to export dumping by the U.S. and EU. Unfortunately, U.S., Australian, and European agribusiness corporations were able to keep this demand off the agenda, by conceding general language on reducing export subsidies. While agribusiness can claim this as a victory, the issue of export dumping can and will most likely come back in future meetings.
The U.S. and Europe put a number of new items on the WTO agenda, like investment, government purchasing, and competition policy. But a coalition of developing countries, led by India, made sure that no negotiations on these topics could take place without the agreement of every single member country in the WTO. India believes that this will prevent these topics from ever being seriously negotiated in the WTO. But will Southern countries withstand increasing pressure from the U.S. and EU to negotiate these issues?
There was a major exception to the reign of ambiguity in Doha. The combined forces of NGOs and a number of Third World governments dealt a major blow against pharmaceutical companies on the issue of drug patenting. This effort was helped by a backlash against the pharmaceutical industry that had limited access to affordable drugs to treat AIDS victims in Brazil, South Africa and other developing countries. Use of the current WTO rules of trade covering intellectual property rights, including patents, to impede public health objectives were specifically repudiated in a special section of the final Declaration. Over a decade of organizing by NGOs combined with strong efforts by several developing country governments' lead to the adoption of the special section, over the objection of the U.S., Switzerland, Germany and the United Kingdom.
The declaration on public health and drug patents represented the first clear victory in the WTO of the coalition of developing countries governments and civil society groups that has emerged over the last decade. This new "public interest coalition" of developing countries and civil society was the most important development of the Ministerial. Coming on the heels of similar NGO-government collaborations on land mines, global warming, and biological diversity protection this new international political force will likely play a growing influence over the global agenda in the next decade.
An important emerging issue that this public interest coalition will be
tackling involves the relationship between the WTO and a new generation of
multilateral environmental agreements (MEAs) - like the Kyoto Protocol and
Biosafety Agreement. The WTO has consistently taken the view that trade rules
should trump environmental rules, and is attempting to enforce this view through
a preemptive strike against the authority of MEAs. There is a similar concern
that this declaration is attempting to expand WTO
rule-making authority into new areas, like drinking water and other public goods and services. NGOs see these as "high alert" concerns for close monitoring and early intervention.
At the end of day, there were no clear winners or losers at Doha, except the
drug companies. Everyone can claim to have survived to fight another day. What
is important is that the lines of the fight are more clearly drawn, with the
NGOs and Third World governments lining up against the rich country governments
and the multinational corporations. The next Ministerial, set for 2003 in
Mexico, will be the next chance for this evolving coalition to move beyond the
victory on drugs to a wide range of new issues. The Mexico Ministerial could be
the beginning of a New World Order very different from that envisioned by George
W. Bush's father.
WTO MINISTERIAL IN DOHA, QATAR:
END RESULT MAY WELL BE
ACCELERATED DECLINE OF THE WTO
WALDEN BELLO, FOCUS ON THE GLOBAL SOUTH & ANURADHA MITTAL, FOOD FIRST: Something was launched at Doha, but to call it a "round" of trade negotiations might be stretching the concept of a round. A round means negotiations on a broad range of issues directed at trade liberalization. What was agreed at Doha were: a) negotiations to clarify or revise some existing agreements, e.g., anti-dumping rules; and b) eventual negotiations for new agreements, e.g., transparency in government procurement, investment, and competition policy.
Getting immediate negotiations going on investment, competition policy, government procurement and trade facilitation was at the top of the agenda of the trading powers in Doha. They fell short of this objective, being able to secure a commitment for negotiations on these issues only after the fifth ministerial in 2003, and only with a "written consensus" from member countries . . . . What is clear is that, contrary to the claims of European Trade Commissioner Pascal Lamy, Doha did not launch a "development round." The key points of the Doha Declaration, in fact, contradict the interests of the developing countries. For example,
* There is only a perfunctory acknowledgment of the need to review
implementation issues, which was the key agenda of the developing countries
coming into Doha;
* The language on the phasing out of agricultural subsidies is watered down owing to the strong objections of the European Union;
* There is no commitment to an early phase-out of textile and garment quotas because of the strong resistance of the United States;
* The demand for a "development box" to promote food security and development which was being pushed by a number of developing countries was completely ignored;
* There is no commitment to change the wording of the TRIPs (Trade-related Intellectual Property Rights) agreement to accommodate developing countries' overriding of patents for public health purposes;
* There is no commitment to change the TRIPs agreement to outlaw biopiracy and patents on life, which was a key developing country concern coming into Doha;
* The declaration eliminates the reference in the draft to the International Labor Organization (ILO) being the appropriate forum for addressing labor and trade issues, which leaves the door open for the WTO to assert its jurisdiction in an area where it has no authority or competence.
The resolution of the TRIPs and public health issue is being trumpeted as a victory for developing countries. This is exaggerated. While an attachment to the declaration does recognize that there is nothing in TRIPs that would prevent countries from taking measures to promote public health, there is no commitment to change the wording of the TRIPs agreement. This is a serious flaw since TRIPs as it is currently written can serve as the basis for future legal challenges to countries that override patents in the interest of public health. . . .
In fact, Doha was a defeat for the developing countries, notwithstanding the resistance they --- and in particular, India --- put up against arm-twisting, blackmail, and intimidation from the big trading powers. Those of us in Doha were witness, as the Equations team puts it, "to the highhanded unethical negotiating practices of the developed countries - linking aid budgets and trade preferences to the trade positions of developing countries and targeting individual developing country negotiators."
Doha was a victory for the forces with a strong interest in subverting the interests of the developing countries that form the majority of the membership of the World Trade Organization by keeping the decision-making process non transparent and undemocratic. . . . This is why this victory may well be a Pyrrhic one for the big trading powers. The combination of developing country resentments inflamed by the Doha process, a deep global recession brought about by the indiscriminate locking together of economies by accelerated trade and financial liberalization, and reinvigorated civil society resistance to corporate driven globalization, cannot but erode the credibility and legitimacy of the institutional pillars of free trade like the WTO.
And without credibility and legitimacy, institutions, no matter how seemingly
solid they may seem, eventually unravel. At the conclusion of the Fourth
Ministerial, Director General Mike Moore thanked the delegates for "saving the
WTO." The end result may well be, instead, the accelerated decline of the
"PRESENT CRISIS CRIES OUT FOR SHARED SACRIFICE
NOT THE OPPORTUNISM SO BLATANTLY DISPLAYED
BY THE NATION'S CORPORATE INTERESTS"
RALPH NADER: U. S. corporations aren't even subtle about it. Waving a flag and carrying a big shovel, corporate interests are scooping up government benefits and taxpayer money in an unprecedented fashion while the public is preoccupied with the September 11 attacks and the war in Afghanistan.
Shamelessly, the Bush Administration and Congress have taken advantage of the patriotic outpouring to fulfill the wish lists of their most generous corporate campaign donors. Not only is the Treasury being raided, but regulations protecting everything from personal privacy to environmental safeguards are under attack by well-heeled lobbyists who want to stampede Congress to act while the media and citizens are distracted.
Only a handful in the Congress --- members like Senator Russell Feingold of Wisconsin and Representatives Peter DeFazio of Oregon and Barbara Lee of California --- have shown the courage to question the giveaways and the quick wipeout of civil liberties and other citizen protections. In most cases, such as the $15 billion airline bailout and corporate tax breaks, legislation has been pushed to the forefront with little or no hearings and only fleeting consideration on the floor of the Senate and the House of Representatives.
One of the boldest grabs for cash has been by corporations seeking to eliminate the Alternative Minimum Tax (AMT), which was enacted during the Reagan Administration to prevent profitable corporations from escaping all tax liability through various loopholes. Not only do the corporations want relief from the current year's AMT taxes, but they are seeking a retroactive refund of all AMT taxes paid since 1986.
This giveaway, as passed by the House of Representatives, would make corporations eligible for $25 billion in tax refunds. Just 14 corporations would receive $6.3 billion of the refund. IBM gets $1.4 billion; General Motors, $833 million; General Electric $671 million; Daimler-Chrysler $600 million; Chevron-Texaco $572 million. The 14 biggest beneficiaries of the minimum tax repeal gave $14,769,785 in "soft money" to the national committees of the Democratic and Republican parties in recent years.
Soon to join the bailout parade is the nation's insurance industry, which is lobbying the Congress to have the federal government pick up the tab for future losses like those stemming from the attack on the World Trade Center. Proposals are on the table for taxpayers to either pick up losses above certain levels or to provide loans or loan guarantees for reinsurance . . . .
Last month, more than 400,000 employees lost their jobs nationwide and the national unemployment rate rose to 5.4%, the highest level since 1996. The Bureau of Labor Statistics said roughly a fourth of the lost jobs were the direct result of the terrorist attacks of September 11. Bailouts, benefits or other aid for these victims of the attacks? No, that's reserved just for the corporations under the policies of the Bush Administration and the present Congress.
Yet it is the workers in the low-wage jobs --- like those in restaurants, hotels, retailing and transportation --- who are bearing the brunt of the layoffs in the aftermath of the attacks on the World Trade Center, according to a report from the New York State Department of Labor. Almost 25,000 people told the department that they lost their jobs because of the trade center disaster. An analysis by the department of the first 22,000 of the claims found that 16% worked at bars, 14% worked at hotels, five percent worked in air transportation and 21% in a category termed "business services." Only four percent worked at Wall Street brokerage firms.
While more workers lose jobs, the Administration is pushing for authority to expand the North American Free Trade Agreement (NAFTA) under new "fast-track" authority. The Department of Commerce concedes that at least 360,000 jobs have been lost under NAFTA, and private research groups estimate the total may be twice that number. Now, with unemployment rising to alarming levels, the Administration decides to cave to pro-NAFTA corporate demands which will only make the labor picture worse. No bailout for laid off workers, just a hard crack across the knees.
As Bill Moyers, the author and national journalist, commented: "They (the corporations) are counting on your patriotism to distract you from their plunder. They're counting on you to stand at attention with your hand over your heart, pledging allegiance to the flag, while they pick your pocket."
The present crisis cries out for shared sacrifice --- not the opportunism so
blatantly displayed by the nation's corporate interests. President Bush and the
Congress must summon the courage to resist the self-serving demands --- the kind
of courage and shared sacrifice that guided the brave rescue workers on
STUDY SHOWS MULTINATIONAL CORPORATIONS
AVOIDED $45 BILLION IN U.S. TAXES
BY ARTIFICIALLY FIXING PRICES
FOR TRANSACTIONS WITH FOREIGN AFFILIATES
ASSOCIATED PRESS: Multinational corporations avoided $45 billion in U.S. taxes last year by artificially fixing prices for transactions with foreign affiliates, according to a study released . . . . by Sen. Byron Dorgan. The companies moved profits out of the United States in two ways: by overpricing goods sold to U.S. operations by foreign affiliates and by underpricing goods purchased by those foreign affiliates, the study found. This practice, known as transfer pricing, moves income out of the United States and effectively puts company profits out of reach of the Internal Revenue Service.
Artificially high prices documented by the study include $5,655 for a toothbrush, $5,000 for a flashlight and $2,306 for a hypodermic syringe. Examples of underpriced goods were $1.58 for a ton of soybeans, $528 for a bulldozer and 82 cents for a prefabricated metal building.
The study by Simon J. Pak and John S. Zdanowicz, both finance professors at Florida International University, estimated the 2000 total tax loss at nearly $45 billion. Earlier studies by the pair uncovered tax losses of $42.7 billion in 1999 and $35.7 billion in 1998. Dorgan, Dem.-North Dakota, included $2 million in the annual Treasury Department spending bill to allow the two professors to expand their studies to recommend ways the IRS can begin collecting these taxes. "Every individual and company is forced to make up the differences with income taxes that are higher than they would need to be if the international corporations who are avoiding their tax responsibility were paying their fair share," Dorgan said.
The companies involved were not identified in the study, which is based on
Commerce Department trade data focused on international pricing of goods. The
study did identify countries to which income from the United States is shifted.
The top five: Canada, $15.8 billion; Japan, $14 billion; Mexico, $9.9 billion;
the United Kingdom, $8.8 billion; and Germany, $8.3 billion.
PENTAGON SEEKING $320 BILLION
BY 2004 IN MILITARY SPENDING
JACKIE CALMES, WASHINGTON WIRE: WALL STREET JOURNAL: Pentagon plan for
big increases, but hasn't enlisted the budget office. The services are told to
build increases of about $15 billion annually into their plans for the budgets
of the next two years. Such rises, inconceivable before September 11, would
drive overall military spending to $360 billion by 2004. On the wish list:
intelligence-gathering sensors and spy drones --- in high demand in Afghanistan
but low supply. A Defense official acknowledges the White House budget office
hasn't "signed up for" the sum. Secretary Rumsfeld said he wants Bush to veto a
2002 budget if it doesn't call for cost-saving base closures, but GOP leaders
PATRIOT ACT "EFFECTIVELY NULLIFIES"
SIX AMENDMENTS TO U.S. BILL OF RIGHTS
JOHN KAMINSKI, COMMON DREAMS: The recent passage and signing of the Patriot Act has effectively nullified at least six amendments of the Bill of Rights addendum to the U.S. Constitution. As a result of this, America is longer America, but a police state, pure and simple. This Patriot Bill is, in fact, a massive violation of the Constitution it purports to uphold and improve . . .
The Patriot Act:
Violates the First Amendment freedom of speech guarantee, right to peaceably assemble provision, and petition the government for redress of grievances provision; it violates the First Amendment to the Constitution three times.
Violates the Fourth Amendment guarantee of probable cause in astonishingly major and repeated ways . . . The Patriot Act, now passed and the law of the land, has revoked the necessity for probable cause, and now allows the police, at any time and for any reason, to enter and search your house and not even tell you about it.
Violates the Fifth Amendment by allowing for indefinite incarceration without trial for those deemed by the Attorney General to be threats to national security . . . It even allows people to be kept in prison for life without even a trial.
Violates the Sixth Amendment guarantee of the right to a speedy and public trial. Now you may get no trial at all, ever.
Violates the Eighth Amendment (cruel and unusual punishment).
Violates the 13th Amendment (punishment without conviction).
For more see:
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