Book Review

Giants of Garbage

Giants of Garbage
by Harold Crooks
300 pages
James Lorimer & Company, Toronto, 1993.

HAROLD CROOKS' NEWEST BOOK, Giants of Garbage, is the most comprehensive and incisive account of the rise of the global waste industry available in print. In Giants of Garbage, Crooks adeptly refines his 1983 study of the waste industry, Dirty Business, by tracing a decade more of the antics of corporations like Browning Ferris Industries (BFI), Laidlaw and Waste Management Incorporated (WMI); the lukewarm efforts of government regulators to check these companies' abuses; and the rising tide of grassroots opposition to the waste industry.

 In Giants, Crooks provides a wealth of new evidence strongly suggesting collusion among the main trash corporations, widespread use of unfair pricing and other oligopolistic practices. And, building on Dirty Business's documentation of WMI's incursion into Saudi Arabia and Argentina, and into Canada in conjunction with BFI, Giants of Garbage traces the spread of the North American garbage kingpins into the markets of continental Europe, Asia, and Indonesia.

 Monopolizing the waste trade

 Central to Crooks' exposé is a series of lawsuits charging the large waste disposal firms with a wide array of antitrust law violations.

• In 1987, a group of commercial business customers filed a national class action lawsuit against Houston, Texas-based BFI and Oak Brook, Illinois-based WMI, alleging the highest echelons of both companies had orchestrated a nationwide price-fixing conspiracy. In one important document, the business customers detailed a number of antitrust cases across the nation and the involvement of key corporate officers from both firms. In 1990, both firms agreed to settle the case for a total of $50 million plus $13 million in attorneys' fees, while denying any wrongdoing. All evidence in the case, including some "4 million pages of documents," was sealed.

• In 1987, following WMI and BFI's settlement of a federal antitrust case for $1 million each and guilty pleas, BFI sued one of its employees, Dave Yeager, claiming that he was responsible for fixing commercial garbage prices with WMI representatives for the Toledo, Ohio region. Yeager counter-sued and vigorously denied BFI's charges.

   As the case wore on, Yeager approached the national grassroots environmental organization Citizens Clearinghouse for Hazardous Waste with information detailing BFI's practice of promoting employees responsible for the Toledo price fixing violations, as well as for Burlington, Vermont predatory pricing violations. In Toledo, Yeager charged, BFI used two different price lists for prospective clients. If a potential customer currently had a contract with WMI, BFI employees were instructed to quote a prohibitively high price. If the potential customer had an existing contract with another competitor, BFI employees were instructed to quote a seductively low price. Ultimately, BFI reached a settlement with Yeager. "What was fully evident," Crooks points out, "was that the out-of-court resolution of the conflict was bought at the price of keeping David Yeager's mouth shut."

• In 1992, the Canadian Competition Tribunal charged Burlington, Ontario-based Laidlaw with developing a captive market on Vancouver Island in Canada. Crooks describes the central facet in Laidlaw's Vancouver strategy as the "evergreen" contract, business agreements that obligated clients to ten years of service to Laidlaw. Clients who wanted to change trash haulers were required to notify Laidlaw 10 years in advance of the termination of the contract or pay a six-month service charge as a cancellation fee. The contracts automatically renewed themselves each year (hence evergreen). The concern of the Tribunal's deliberations was the way in which Laidlaw secured its clients' signatures on the contracts. "A disturbingly recurring theme through much of the evidence before the Tribunal was that the signature on many of these contracts had been obtained by representing to the customers that the documents they were being asked to sign were æa mere formality,' or because it was æthe national corporate practice that Laidlaw followed.'" The Tribunal's members frowned on Laidlaw's argument that the evergreen contracts were no different from those of its competitors (i.e. WMI and BFI). The Tribunal ordered Laidlaw to modify the contracts, ruling that they were predatory agreements designed to keep competitors out of the market.

• In 1991, Laidlaw, without admitting guilt, settled fraud charges with the State of California by paying $3 million in fines. The state charged Laidlaw with mailing agreements to its customers seeking to secure a pledge that the customers would not dispose of hazardous waste in Laidlaw's dumpsters, ostensibly for insurance purposes. When the customers returned the signed forms to Laidlaw, a peel-off sticker was removed. In the absence of the sticker, the documents appeared as enforceable business contracts, and that is how Laidlaw treated them.

 All of these incidents were resolved without major implications for the perpetrators other than a few million dollars in fines. With the exception of the federal antitrust case in Toledo, no guilt was established. And all of the evidence compiled by the plaintiffs in these cases, including the informed internal knowledge of the once-vociferous David Yeager, was effectively buried, hushed up and squelched.

 Giants makes the case that the ability of the waste industry to violate and skirt the law, absorbing occasional fines, convictions and civil penalties without major negative impact is a result of its enormous economic and political power.

 Crooks traces that power to the industry's successful efforts to cultivate profits through the takeover of municipal waste services, landfills, incinerators and recycling operations, on the one hand, and to its practice of hiring prominent former government regulators and officials (e.g., former two-time EPA administrator William Ruckelshaus, former Bush Chief of Staff James Baker, and former EPA general counsel John Bernstein) on the other.

Crooks strongly argues that the alleged links between organized crime and the waste industry, while historically grounded, are now beside the point because while many current business practices of the waste industry mimic traditional organized crime tactics, they are nonetheless business practices and not the work of a familial clan. "Financial muscle [has] replaced the physical kind," he writes.

There can be little doubt that the industry wields tremendous political clout. For example, a series of U.S. Supreme Court rulings prevents states from banning waste imports, on the grounds that trash is a protected commodity under the constitution's interstate commerce clause. States will not be able to protect themselves from becoming national dumping grounds by banning or restricting waste imports unless Congress gives them the power. But congressional efforts to remove waste from protection under the Interstate Commerce Clause of the Constitution have been thus far forestalled by the lobbying power of the waste industry in tandem with opposition from politicians from heavily populated East and West coast regions. Efforts by grassroots groups in coalition with politicians from states where much out-of-state waste is currently shipped are continuing, but the outcome of this struggle is uncertain.

 Despite the immense industry power he describes, Crooks is not despairing or hopeless. He calls attention to the efforts of a broad-based citizens' opposition to the industry, encompassing people of all races, creeds and political ideologies. Crooks weaves an analysis of the political economy of waste together with the spirit of the grassroots resistance to the garbage giants. The book accurately reflects the concerns of hundreds of grassroots groups, combining tales from the front lines - where local activists confront the high-power consultants, salespeople and attorneys of the waste industry head on - with a play-by-play history of these companies' rise from the trash heap to multinational status, complete with a litany of their crimes against society.

Crooks does leave out of the story one important recent development: the emergence of the "bad boy strategy" being employed by grassroots activists and state legislators alike in the control of the waste industry. Bad boy legal mechanisms require companies to provide the contracting or licensing agency with a full disclosure of their criminal and civil legal violations during the last three to 10 years. These laws also allow government agencies to punish a company with a history of legal and procedural violations by rejecting or revoking its permits, barring it from contracts with government agencies, and/or "executing" the company by removing its charter to operate. Several state legislatures have passed permit bar statutes or stiffened their permitting statutes in order to prevent bad actors from setting up landfills for out-of-state waste, thus avoiding constitutional issues involving interstate commerce. Many more states, at the behest of grassroots activists, are now seeking passage of such laws.

 This oversight aside, Giants of Garbage is a tremendous accomplishment, a book which should become an almanac for grassroots activists fighting the waste industry. What makes the movement so important is well articulated by Crooks himself, who explains why the stakes are so high in the fight for environmental justice. Like all for-profit business enterprises, the waste companies rely on the minimization of expenses in order to maximize profits. However, "what makes the [waste industry] unlike most industries is that the consequences of its activities have to be measured on a time scale without historic precedent. ... Since major waste depositories most likely will require oversight for periods ranging from several generations to forever, the windfall profits of corporate dumping are privatized while the longer-term liabilities are socialized."