The Multinational Monitor


The 10 Worst Corporations of 1989

by Russell Mokhiber

It has become fashionable for environmentalists and public interest groups to shy away from pointing fingers at individual corporate or executive wrongdoers and to blame "the system." Thus, in the wake of the crime at Valdez, the spill of millions of gallons of crude oil by Exxon into the waters off the coast of Alaska, Greenpeace, the world's premiere environmental group, said it would be strategically wrong for citizens to send the company a message by boycotting its products. "It would be easy," read the copy for a recent Greenpeace ad, "to blame the Valdez oil spill on one man. Or one company. Or even one industry. Too easy. Because the truth is, the spill was caused by a nation drunk on oil."

So, according to Greenpeace, it is not Exxon's driving that caused the problem, it's people who drive cars.

In the most fundamental sense, we are each accountable for our future. Greenpeace argues that had the oil not spilled in the Prince William Sound, it would have concluded its useful life fouling the air of the lower 48 states and eventually the entire planet, in the form of carbon dioxide, nitrogen oxide and a host of other gases that contribute to acid rain and global warming. Good point. Moving toward an alternative energy future is important. Still, we have to deal with the crimes of the present on a case-by-case basis.

Those who wield great power, and those who abuse it, must be held primarily accountable. Even in an age of gluttony, where consumerism has run rampant and where consumers have delegated control of the technologies that feed their habits to corporate chieftains who abuse their trust with recklessness that often results in destruction, a primitive standard of justice demands that systemic change be accompanied by a modicum of personal and institutional accountability.

It is in this spirit that we present "The Ten Worst Corporations of 1989." This list is our effort to point fingers, to pinpoint the blame and to hope that people demand and secure justice by joining boycotts, pressing for prosecutions and putting culpable individuals behind bars. This is the second year that we have run the "Ten Worst" list. The companies profiled here are large corporations that wield vast power, often recklessly, and often to the detriment of the environment, workers, consumers, and governments. If left unchecked, the consequences of their behavior will be far worse than the damage profiled here.


Shameless Profiteering

If in 1989 you had AIDS or the HIV virus, and you needed the life-prolonging drug AZT, or azidothymidine, then you had no choice but to turn to Burroughs Wellcome Co., and its parent, the London-based Wellcome PLC. And if you needed AZT for one year, it would cost you $8,000. Why? Because that's what Burroughs Wellcome said it would cost. And Burroughs Wellcome is the only company that manufactures AZT.

The AZT monopoly and the high cost of the drug made health groups furious with Wellcome. They charged that Wellcome was a "corporate extortionist" engaged in "shameless profiteering".

For the three years ending on August 27, 1988, Wellcome's profits doubled, to $198 million. The company's gross profit margin on AZT is an industry high 70 to 80 percent. Wellcome denies unjust profiteering. The company said that it needed to recoup its up-front investment in AZT, which included paying for a major clinical trial. But gay activists are angry that Wellcome is profiteering from what was essentially taxpayer- funded research. "Wellcome acquired AZT years ago," reported Marilyn Chase in the Wall Street Journal on September 15, 1989. "But it didn't create the compound, it wasn't the first to discover its effectiveness against AIDS-type 'retroviruses', it didn't uncover its effectiveness against AIDS itself and it didn't conduct the first human tests. Much of that work was done by other scientists, some at the National Institutes of Health with federal funding."

AIDS activists argue that victims are essentially made to pay for the drug three times. An August 31, 1989 letter to Burroughs Wellcome Co., USA, from more than a dozen organizations and individuals devoted to the welfare of people with HIV infection, said that the victims were forced to pay for the drug's initial development, for the many studies needed to permit its marketing as taxpayers and finally to buy it from Burroughes-Wellcome.

While the company issued blanket denials that it was profiting unjustly from the drug, it has refused to release the actual costs of development and production. The company claims that most of its dividends go to charity, and much of the profits are plowed back into research and development. The company itself is 75 percent owned by the Wellcome Trust, a nonprofit organization that has spent millions on pharmaceutical research.

Nevertheless, AIDS activists took to the streets in the United States and Britain. Five people were arrested on Wall Street as they chained themselves to a balcony inside the New York Stock Exchange. AIDS activists picketed and protested the company's Research Triangle, North Carolina headquarters around the clock since early August 1989, when researchers expanded the drug's potential market from 20,000 victims to 650,000.

Within weeks, the company was on its knees. On September 18, the company cut the price of the AZT drug by 20 percent. Activists called the move a "good first step". But the New York City-based AIDS Coalition to Unleash Power, or ACT UP, observed that the company's announcement was "a pretty strong indication that the company has been profiteering all along."


Arrogant and Complacent

On March 24, 1989, in the worst oil spill in U.S. history, the Exxon Valdez supertanker ran aground, broke open and spilled more than 11 million gallons of crude oil into Prince William Sound off the coast of Alaska. Exxon responded to this environmental catastrophe with grotesque smugness. When asked to compare the disaster to the one at Bhopal, Exxon's chief executive officer, Lawrence G. Rawl told reporters that Exxon had "nobody dead." Rawl said he didn't understand what all the fuss was about. He blamed God for the accident and attacked the Coast Guard and the state of Alaska for a botched cleanup.

The State of Alaska has declined to prosecute Exxon for the spill. The Alaska Attorney General's office explained that the most stringent penalty available to the state was a misdemeanour oil spill violation carrying a $100,000 fine. "Given the severity of the acts, the costs and extent of investigation and prosecution and given the tools that the federal government has in the way of laws, felony provisions, and treble damages, we believe it was appropriate to leave it to the federal government," said Larry Weeks, chief of the Attorney General's criminal division. "If someone commits a murder, but can only be convicted of a misdemeanour, it's demeaning to the process," Weeks said.

A federal criminal investigation of the spill is ongoing. A 110- page report on the spill prepared by the Alaskan government and submitted to the National Transportation Safety Board (NTSB) concluded that the probable cause of the accident was the failure of the ship's Master to manage and supervise his crew properly and his having left the bridge while passing through the ice-laden water of Prince William Sound. But the report also blasted higher-ups at Exxon as well as the Alyeska Pipeline consortium, claiming that poor management by the Exxon Shipping Co. and the "massive failure" of Alyeska in responding to the spill greatly contributed to its severity.

"The real causes of the Exxon Valdez disaster," wrote Alaska oil spill coordinator Robert LeResche, "were not heroic but only pedestrian. There was not a berserk captain waving a bottle on the bridge, there was not an autopilot device run amok, there was not a broken radar, or a storm. There were simply arrogant and complacent people at the top levels of Exxon Shipping Co. and Alyeska Pipeline Service Co. who did not pay attention to their responsibilities."

LeResche reported that although the oil industry views the absence of major accidents prior to the Valdez grounding as an "endorsement" of its Alaskan operations, the Exxon spill "should bring Exxon Shipping and Alyeska to the sobering realization that the past history of relatively uneventful Valdez operations is no cause for cheer or complacency. The NTSB's report on the grounding of the Exxon Valdez hopefully will cause the shipping industry to change their retrogressive attitudes and approaches toward marine safety and the environment." It is possible that only the Exxon Valdez' Captain, Joseph Hazelwood, will take the heat for the spill. ln May, 1989, a state grand jury in Anchorage returned felony indictments against Hazelwood on charges of criminal mischief in the second degree. The grand jury considered evidence that Hazelwood had been drinking, that he left the bridge in the hands of an unqualified third mate and that he was responsible for the ship's automatic pilot being engaged during a portion of the maneuvers leading up to the grounding. The indictment also alleged that Hazelwood's post-accident actions to free the tanker from the reef caused additional damage to the ship and possibly contributed to the size of the spill. The Hazelwood case has yet to go to trial.

Federal officials are not, and should not be, content with putting lower-level Exxon employees behind bars.


Public Nuisance

While Exxon was getting the headlines, Mobil was avoiding the spotlight. For good reason. In California, Massachusetts, and around the country, Mobil was polluting the environment and endangering peoples' lives.

In April, 1989, the city of Torrance, just outside of Los Angeles, California, citing the fear of a "disaster of Bhopal- like proportions," filed a lawsuit against the Mobil Oil Corporation seeking to have the refinery declared a public nuisance and giving the city authority to regulate it. Torrance officials were concerned that an uncontrolled release of acutely toxic hydrofluoric acid from the refinery could threaten the lives or health of hundreds of thousands of Torrance residents.

"Mobil cannot now guarantee with reasonable certainty that a fire, explosion, malfunctioning equipment or some other accident would not cause an uncontrollable release of acutely hazardous chemicals," the lawsuit charged. City leaders claim that over the past five years, Mobil has been cited an average of 13 safety violations per year, many of which involved multiple infractions. The city dismissed the company's payment of fines that followed the notices of violations, alleging that "Mobil's routine payments of fines for these violations amounts to the purchase of a license to pollute in excess of state standards set to protect the health of California citizens."

Citing Mobil's disgraceful safety record, the city detailed many of the 127 safety violations at the refinery that were reported to the Fire Department. "They have a lot of hydrofluoric acid in the refinery. It is a catalyst that is used for increasing the octane of no-lead fuel," City Attorney Kenneth Nelson told Multinational Monitor at the time. "There were a number of laboratory tests done in Nevada on hydrofluoric acid. Under the atmospheric conditions as existed during that testing session - hot, desert conditions - they discovered that the stuff can vaporize after an accidental spill or explosion and move down- wind in a very rapid manner in such concentrations as to be extremely deadly ... That got a lot of publicity. Then, it was discovered that at any given time there are approximately 26,000 gallons of hydrofluoric acid in this refinery."

In July 1989, the city followed up the civil lawsuit by filing criminal charges against Mobil, alleging violations of state safety standards in connection with a July 1988 explosion that killed one man and burned two others. The charges were later dismissed.

In Massachusetts, state officials ordered Mobil to place advertisements in major newspapers around the state urging other companies in the same business to comply with state environmental laws and to upgrade their facilities to protect the environment. The state had charged Mobil with failing to report the discovery of a leaking tank at a Mobil service station on Route 132 in Barnstable. The tank posed a potential threat to municipal water supplies.

And in December 1989, Mobil pleaded "no contest" to criminal charges stemming from two 1988 pipeline ruptures which resulted in the spill of more than 130,000 gallons of crude oil, most of which flowed into the Los Angeles River and the city's sewer system.


Neutralizing Critics

The international boycott of Nestle products is still on. Nestle still markets its infant formula around the world to induce sales in violation of the World Health Organization (WHO) infant formula marketing code. Boycott organizers are concerned about Nestle's marketing of the infant formula in Third World countries, where mothers often mix the formula with tainted or unsanitary water, leading to illness and death for hundreds of thousands of babies each year. According to UNICEF, at least one million babies could be saved each year through breastfeeding alone.

An earlier worldwide boycott conducted in the 1970s was called off when organizers deemed Nestle to be in compliance with the WHO code, but the boycott call was renewed in October 1988 amid charges that Nestle had changed its practices and was no longer in compliance.

As the Monitor reported earlier this year [See, "Nestle Undercover," Multinational Monitor May 1989 at 21], Ogilvy & Mather, the giant advertising and public relations firm, devised an international operation to "neutralize critics" of infant formula, according to an internal Ogilvy & Mather document leaked to the media in February 1989. Nestle hired Ogilvy to help it control negative publicity associated with the boycott.

The program outlined in the Ogilvy document, titled "Proactive Neutralization: Nestle Recommendations Regarding the Infant Formula Boycott," is "built around the idea of neutralizing or defusing the issue by quietly working with key interest groups." Both Ogilvy and Nestle distanced themselves from the document and the suggested program after it was leaked to the press. Nestle said that it rejected the recommendations made in the Ogilvy paper. Political damage control was underway.

The program gave Ogilvy the responsibility for "interest group assessment and monitoring." The objective, according to the document, was to "initiate an early warning system through which Nestle gains awareness of actions being planned, and is equipped to take appropriate proactive or active steps. A second objective was to "neutralize critics."

The Ogilvy plan also suggests that Nestle sponsor a "Nestle Positive Image Campaign" to run on Channel One, a 12-minute daily satellite television news show produced by Whittle Communications. Channel One was designed "to inform students of the world around them, in a way that stimulates and promotes questions." The show planned to reach 8,000 schools by the fall of 1989. "There is an existing opportunity to be a (or THE) major sponsor of Channel One," the document implores. "The idea for Nestle, however, is not to advertise, but to donate the 30 seconds on daily/weekly airtime for Nestle-sponsored additional daily news programming: FOOD FOR THOUGHT."

Tim Smith, head of the Interfaith Center on Corporate Responsibility (ICCR), was amazed by the proposal. "Unfortunately," Smith told the Monitor, "this new revelation reminds the churches of Nestle's frequent use of dirty tricks and facile public relations almost a decade ago. The church community calls on Nestle to deal with the real issue of formula supply and infant health rather than taking the low road in a diversionary public relations campaign."


Abuse, Fear and Harassment

In the 1970s, people working for Frank Perdue would gut and cut up to 50 chickens a minute. Now, they find themselves cutting more than 90 a minute. The workers perform two or three motions over and over for a whole day, thousands of times a day. The consequences are tendonitis and carpal tunnel syndrome, a crippling repetitive motion disorder.

A report by National Public Radio reporter Daniel Zwerdling in April, 1989 found that Perdue employees at the central Lewiston, North Carolina facility suffer from high rates of carpal tunnel syndrome. A physician who studied the problem told Zwerdling that he had personally seen 75 to 80 cases of the syndrome among Perdue workers.

Zwerdling obtained an internal Perdue memo explaining that it is normal procedure for "about 60 percent of the work force to visit the plant nurse every morning for Advil, Vitamin B-6 treatment and hand wraps" in order to be able to work on the processing line. Line workers are expected to process up to 75 chickens a minute and receive little rest time.

J. Davitt McAteer, executive director of the Occupational Safety and Health Law Center in Washington, D.C., found that "breaks for processors last exactly 12 minutes, during which time a worker has to remove her apron and coat, wash off the blood, remove up to three gloves, her hat and ear phone, walk to the restroom (in some instances a substantial distance from the line), return, put back on all of the equipment and step back into line." All this happens in the 12 minutes allocated for the break, which is given not on demand or according to the body's needs, but rather when the supervisor shows up and says, 'It's your turn."'

Perdue's employees are not unionized. More than two-thirds of them are black women, often illiterate, who must choose between unemployment in rural North Carolina and dangerous work for Perdue at $5.45 an hour.

"The abuse they showed me when I went to them with my problem was unbelievable," Donna Bazemore told the Monitor [See, "Perdue Farms: Poultry and Profits, by Bob Hall, Multinational Monitor, September 1989]. "The fear, the harassment is so bad, I call it a closed-in slave camp." In 1987, Bazemore became the first Perdue worker to win worker's compensation for carpal tunnel syndrome in North Carolina. "Most people just can't take it," she told the Monitor. "The pay is good for these rural areas, but the treatment is inhuman. They actually feel like they own you."

As Americans turned away from red meat, they turned to chicken and Perdue Farms' business soared. The rising interest occurred in tandem with lower standards of sanitation. The United States Department of Agriculture (USDA) admits that 37 percent of the birds it approves are contaminated with salmonella, up from 29 percent in 1967. One internal USDA report said the figure is actually as high as 76 percent in some plants. "Poultry productivity has outpaced all U.S. manufacturing since 1960," reported the Institute for Southern Studies, a Durham, North Carolina-based activist group in July 1989, "but the industry ranks as one of the ten most dangerous in the country. Profits have soared, yet wages remain below the average for the food industry. People are eating record quantities of chicken as a healthy alternative to red meat, but the rate of food poisoning from contaminated birds is on the rise."

The problem with Perdue might reflect the ethics of its founder, Frank Perdue. Perdue the man, the chicken magnate who has spent millions of dollars on television advertisements cultivating his "tough guy" image, was charged with recklessly and negligently killing a man in a highway accident 15 years ago, yet he walked away without a trial, according to a report in Southern Exposure magazine in July 1989.

On October 30, 1974, Perdue's car collided with two cars on the Pennsylvania Turnpike, killing one of the other drivers. Investigators say that Perdue was speeding and apparently ignored or overlooked warning signs and red lights as he entered a lane reserved for oncoming, detoured traffic. Perdue was charged with involuntary manslaughter, arrested and released on $500 bail, but the case was dismissed on May 12, 1975 "because it was not tried within the 180 days as required by Pennsylvania law," federal investigators reported.

According to the Southern Exposure report, Perdue hired Philadelphia lawyer Arlen Specter, the city's former district attorney and later a U.S. Senator., who successfully defended him.

The magazine also reported that since the highway death 15 years ago, Perdue has been convicted of speeding 16 times in Maryland alone.

When he purged 55 pro-union workers at a plant in 1980, the United Food and Commercial Workers (UFCW) union called for a national boycott of Perdue products. Perdue sued the union and allegedly solicited aid from the Gambino crime syndicate in New York to further his union-busting efforts. The mafia turned him down, but Perdue has successfully busted all unionizing efforts to date.


Innocence by Association

When word first leaked in Washington that Philip Morris, the company that brought us the Marlboro Man and other purveyors of death and disease, was planning an ad campaign in conjunction with the National Archives to promote the Bill of Rights on the advent of the document's 200th anniversary, many laughed it off as a ridiculous rumor. Then came the slick television ads. There was the Philip Morris logo. And there was the Bill of Rights. And there was the deep voice telling Americans what a great country they live in.

The propriety of the arrangement between the Archives and Philip Morris was questioned by a number of Congressional officials, including John Conyers, D-Mich, chairman of the House Government Operations Committee, who instructed the General Accounting Office to review the deal. Other members of Congress called on the Justice Department to determine whether the television ads run by the company violated the 1971 law banning televised cigarette commercials. Rep. Chester Atkins, DMass, likened the company's association with the Bill of Rights to the efforts of the Medellin cocaine cartel to fund children's basketball leagues in Colombia. "In both instances, it is an attempt to buy friends and respectability," Atkins said.

Public Citizen called the effort "a joint venture that smears the Bill of Rights with the blood of all Americans killed as a result of smoking Marlboro and other Philip Morris cigarettes." Public Citizen charged the company with "spending tens of billions of dollars to addict tens of millions of Americans to often-lethal smoking habits."

Michael Pertschuck, co-director of the anti-smoking Advocacy Institute, called the Philip Morris/Archives deal an effort by the company to achieve "innocence by association."

Last year, Philip Morris' Marlboro cigarettes killed another 75,000 Americans. Cocaine killed 5,000.

While the company was in the United States pushing the Bill of Rights, it was, as a leading player in the infamous U.S. Cigarette Export Association, seeking to break down an increasingly vocal wall of anti-smoking activists throughout Southeast Asia.

The Reagan administration pressured Japan, Taiwan and South Korea to open their markets to U.S. cigarette companies. And the Bush administration, proving its allegiance to the tobacco interests, followed suit in the spring of 1989, when Bush's U.S. Trade Representative, Carla Hills, threatened Thailand with trade sanctions if it didn't open its markets to American cigarettes. Thailand has had a longstanding policy banning both domestic and foreign cigarette advertisements on television, radio, newspapers and magazines. Philip Morris argued that this ban constituted an unfair trade practice.

But Bush met a rising tide of protest from both Asian and American anti-smoking activists. In the United States, Hills was pressured to hold hearings on the Thailand issue, and more than 20 anti-smoking activists testified against her bullying. In Thailand, anti-smoking activists made the tobacco import issue a hot political topic for Prime Minister Chatichai Choonhavan. "To export cigarettes and coerce foreign governments into liberalizing their cigarette market, while simultaneously restricting the promotion and use of cigarettes in home markets [the United States], is clearly a case of double standards," read one Thai anti-smoking leaflet.

In a May 31, 1989 letter to Hills, 17 members of Congress warned Hills that to pursue trade sanctions against Thailand would perpetuate "an extraordinarily expensive and ultimately lethal health risk abroad." The members of Congress said it was "hypocritical" for the United States to consider a television advertising ban abroad an unfair trade practice while at the same time considering a ban on television ads in this country a "national health priority."

By July 19, 1989, the American Public Health Association (APHA) had collected more than 140,000 signatures calling for a change in U.S. tobacco trade policy.

The APHA pointed out that an estimated 2.5 million people die annually from smoking-related diseases and that last year alone the U.S. exported 100 billion cigarettes.

Until recently, most Asian countries had either banned or heavily taxed foreign cigarettes. Since 1985, Japan, Taiwan and South Korea were forced to open their markets as a result of U.S. trade pressures. The results will be increased death and disease. Since 1985, Japanese cigarette sales have increased 2 percent, reversing a 20-year downward trend. And the average Taiwanese consumed 80 more cigarettes in 1987 than in 1986, all of them foreign.


Death on the Job

On October 23, 1989, an explosion and fire at the Phillips Petroleum Co.'s Pasadena, Texas facility killed 22 workers and injured 124 others. The blast occurred after a polyethylene reactor at Phillips' Houston Chemical Complex released and ignited a huge vapor cloud. The blast could be heard from miles around and created a fireball visible for 15 miles. Phillips' environmental director Bill Stolz said that the explosion was caused when a seal blew out on an ethylene loop reactor, releasing ethylene-isobutane, a compound used in making plastics. The Phillips plant makes 4.5 million pounds of plastics daily for milk jugs and toys.

Union officials called the blast and the resulting death and injury a "foreseeable consequence" of known problems with plant operations. Robert Wages, vice president of the Oil, Chemical and Atomic Workers Union (OCAW), told Congressional investigators that a preliminary union investigation revealed three primary factors leading to the fatal explosion: an inadequate safety policy governing the maintenance of the plant's chemical reactor systems; the use of subcontractor maintenance crews to work on reactor systems as a cheaper substitute to the regular Phillips workforce; and an inherently flawed reactor design.

A Texas state government heavily influenced by the petrochemical industry seems to have precluded the kind of criminal investigation into possible homicide, reckless homicide, reckless endangerment or similar offenses that have been conducted in similar cases from California to New York. Federal officials, including the U.S. Attorney in Houston, however, might look at possible criminal violations of federal occupational safety and health laws.

Gerard Scannell, the newly appointed safety-conscious director of the Occupational Safety and Health Administration (OSHA), expressed concern about the fact that OSHA has cited the Phillips facility for a number of serious violations over the last several years but has not performed a comprehensive inspection of the site since 1975. Scannell pledged to review the criteria used by OSHA to prioritize inspections, and to evaluate the adequacy of the agency's current staffing levels and resources. Scannell told Congressional investigators in November that "a full and thorough" investigation is underway to determine the causes of the explosion and whether there were any violations of OSHA regulations.

Wages, appearing before the Employment and Housing Subcommittee of the House Government Operations Committee in November 1989, testified that the key element contributing to the accident was the fact that the Phillips plant employed a "maintenance lock- out policy" which was "inconsistent with OSHA standards and good industry practices." A "lock-out" policy compromises the procedures followed to ensure that maintenance is not performed on live chemical reactor systems unless they are sealed off, disconnected or otherwise freed from the hazards of unwanted movement or releases. Wages testified that the absence of appropriate controls during maintenance work performed on October 23, resulted in key valves being left open. The open valves, in turn, may have allowed the massive vapor release and explosion, he speculated.

Wages also raised questions about Fish Engineering and Construction, the primary maintenance subcontractor at the Houston Chemical Complex. "The union investigation has identified several specific safety-related incidents that relate to the training and experience of the subcontracted workers," Wages said. He described a number of accidents involving Fish employees, including a "lock-out" incident last August which resulted in one death and four injuries. "Fish Engineering subcontractors opened piping to the off-gas scrubber tank without isolating the line," Wages said. 'The line vented flammable solvents and gas into an adjoining work area. The gas and liquid ignited and burned the workers," he added.

Wages cited other factors that contributed to the explosion, including "pressures to keep production rates up, a relentless effort to reduce labor costs by reducing the proportion of Phillips employees on the plant workforce, a flawed alarm and evacuation program and inadequate enforcement of OSHA regulations coupled with a lack of appropriate regulations."


Serious Contamination

On June 6, 1989, 70 federal agents raided the Rocky Flats nuclear weapons facility in Colorado. The decision to invade the bomb plant came on the heels of a lengthy investigation described in FBI agent Jon S. Lipsky's 116-page affidavit, which convinced a federal judge to unleash the agents. In his report, Lipsky accused Rockwell International and the U.S. Department of Energy (DOE) of "knowingly and falsely" stating that the plutonium- processing plant complied with federal environmental laws. In doing so, the contractor and its government client concealed "serious contamination" at the site. Lipsky charged that Rockwell and DOE secretly dumped hazardous waste into public drinking water and surreptitiously operated an incinerator they said had been shut down.

A report by Representative John Dingell's Subcommittee on Oversight and Investigations of the House Energy and Commerce Committee found that the DOE identified pervasive health and safety problems at the Rocky Flats Plant involving inadequate fire protection, inadequate protection of workers from plutonium contamination and an ineffective quality assurance program. The subcommittee reported that the DOE closed down operations at one of the key weapons buildings at Rocky Flats due to radiological control problems, including the exposure of three people to potentially high levels of plutonium contamination.

The subcommittee also reported that on March 7, 1985, the Governor of the State of Washington toured the Hanford reservation in Richland, Washington. Just prior to the arrival of the Governor's party near a site contaminated with radiation, and on direct orders from Rockwell Hanford Operations management, signs which warned of the radiation hazard were removed. A part of the Governor's entourage passed right through the contaminated area, unaware of the hazard.

According to Dingell investigators, "Rockwell covered up this incident for almost one year until the matter cam to the attention of the media and subcommittee." According to Rockwell's former head of safety at the facility, "members of the Waste Management Program Office have repeatedly put pressure on members of the Radiological Protection Department to remove posting signs in areas of contamination."

In September 1989, Rockwell management sought assurances from federal and state authorities that the company would not be prosecuted. But those assurance were not forthcoming, so Rockwell sued the authorities, seeking to clarify its liability. "We have filed suit very reluctantly,n said Rockwell Chairman Donald Beall. "But we simply cannot expose our employees and the company to the risk of criminal charges arising out of good faith actions under the contract and at DOE's direction."

Federal authorities seemed offended by Rockwell's quest for immunity and in October 1989, Rockwell, under serious public pressure and facing a federal grand jury probe in Denver, agreed to pull out of the Rocky Flats contract. The federal criminal probe is ongoing.


Deadly Double Standard

No chemical company its size has as dirty a record as the Velsicol Chemical Co. of Tennessee. Velsicol is the world's only producer of the pesticides chlordane and heptachlor, two pesticides banned in the United States because they are considered probable human carcinogens. Yet, according to a report by the environmental group Greenpeace, over the last two years Velsicol has exported approximately 5 million pounds of the chemicals to at least 25 countries.

The ongoing dumping of these two cancer-causing agents on poorly protected countries of the Third World etches a deadly double standard on the company's bottom line. For years, consumer groups in the United States have been pressuring the U.S. Environmental Protection Agency (EPA) to ban the chemicals from use in this country. In 1978, the EPA responded in part by mandating an end to most U.S. agricultural applications of chlordane and heptachlor after studies indicated that they were carcinogenic in lab animals, highly persistent in the environment and accumulative in the food chain. And in 1988, the EPA struck a deal to end all domestic sales of the products. That deal, however, allows Velsicol to continue to sell the chemicals abroad under a provision of the federal pesticide law which permits the production and export of pesticides prohibited for use in the United States.

Greenpeace officials called for the repeal of that "dumping" provision. Greenpeace charged that the loophole has created a "circle of poison" whereby The production of banned pesticides by companies such as Velsicol results in severe contamination both here and abroad and poses a serious threat to U.S. public health when we import foreign-grown produce treated with the toxic chemicals.

In a report released in September 1989, Greenpeace found that an important consequence of Velsicol's continuing production of chlordane and heptachlor is the release of large quantities of toxic pollutants into the environment surrounding the company's production facilities. "The company's practices have contributed to, if not caused, contamination to such an extent that at least three sites in which Velsicol's pesticide wastes are implicated are now federal Superfund sites," the report found. In 1987, according to the report, Velsicol released approximately 660,903 pounds of highly toxic chemicals, including chlordane, heptachlor and carbon tetrachloride, into the air at plants in Marshall, Illinois and Memphis, Tennessee. "In Memphis, Velsicol is permitted to dump toxic waste from its manufacturing operations into the Memphis sewer system," the report alleged.

Greenpeace maintains that Velsicol's exports of chlordane and heptachlor violate provisions of the United Nations Food and Agricultural Organization's voluntary code of conduct with regard to pesticide distribution. The two pesticides are being used in particularly dangerous ways. The continued use of heptachlor on sugar cane and fruit and vegetable crops in a number of countries, for example, has led to significant contamination problems as a result of the product's persistence in the environment and its transmission through the food chain. Agricultural and other workers are also at risk when they apply chlordane and heptachlor without adequate protection from exposure.

Greenpeace is seeking a repeal of the federal loophole that allows production and export of pesticides banned for use in the United States. Greenpeace calls the export provision a discriminatory double standard that "codifies tacit approval of U.S. companies dumping their products which are unwanted or highly toxic on developing countries."


Criminal Recidivist

Waste Management Inc., (WMI) the largest waste dumper in the U.S., is also a repeat offender. Last year, its criminal record became so offensive that the Environmental Grantmakers Association (EGA), a coalition of foundations which gives money to environmental groups, began giving serious consideration to a proposal to not allow for-profit corporations to join its board. This move was precipitated by an attempt by Waste Management Inc. to become an EGA member.

EGA consists of 90 foundations that fund national public policy and grassroots groups working for environmental protection. Since 1987, the Association has met to share information and ideas about issues and projects. Waste Management's presence at EGA meetings since 1988 created controversy within the group and led to the December 1989 vote on corporate membership.

Waste Management is the largest publicly held waste disposal corporation in the United States. In March of 1989, California Waste Management, a subsidiary, pleaded no contest in the largest criminal antitrust case in California history, paying a record $1 million fine. Waste Management of Florida pleaded no contest to price fixing in Florida's Dade and Broward counties and was slapped with a $1 million federal fine in January 1988. Waste Management also pleaded guilty in October 1987 to conspiring to fix prices in the Toledo, Ohio area with Browning- Ferris Industries. And in May 1989, the U.S. EPA fined Chemical Waste Management, a WMI subsidiary, a record $4.5 million for improperly burning PCBs at a Chicago incinerator.

Those opposed to WMI admittance to EGA argued that Association members fund national and grassroots groups who undertake a myriad of environmental projects, and many of these environmental groups oppose the building of polluting disposal facilities, advocate toxic use reduction and waste prevention and encourage communities to reduce solid waste, all goals that conflict with WMl's interests.

"The presence of WMI in such a funding community raises disturbing questions about the kind of information the corporation will obtain and about WMl's potential influence on the opinions and decisions of grantmakers," said Peter Bahouth, executive director of Greenpeace USA. "It also grants legitimacy to a corporation sorely in need of a positive environmental reputation."

Russell Mokhiber is the editor of the Corporate Crime Reporter, an investigative weekly based in Washington, D.C.

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