The Nationalization Option: Considering a Government Takeover of Citigroup
The Wall Street Rip Off: Fees and Consequences
Eyes on the Prize: Incentivizing Drug Innovation Without Monopolies
New Directions for Government Motors
A BIG Idea: A Minimum Income Guarantee
Grassroots Power and Non-Market Economies
Behind the Lines
Merck’s Doctor Hit List
Drug company Merck circulated a list of doctors that needed to be “neutralized” because they had criticized the drug Vioxx, court documents revealed in April. Discovery for a class action lawsuit brought in Australia against the pharmaceutical giant alleging Vioxx caused heart attacks produced a series of e-mails containing the doctor “hit list.”
“We may need to seek them out and destroy them where they live,” one e-mail excerpt read to the court stated. There are also indications that the company used intimidation tactics against researchers critical of the drug, including insinuating that funding to academic and research institutions would be rescinded.
Merck launched Vioxx in 1999, touting it as the only anti-inflammatory drug that did not cause stomach problems. Before it was voluntarily withdrawn from the market in 2004 because of evidence that it caused heart attacks and strokes, about 80 million people worldwide were using the drug. In 2008, Merck settled thousands of U.S. lawsuits for $4.85 billion. The company is still under investigation by a U.S. federal grand jury and is currently fighting a class action lawsuit in Australia that alleges Merck knew of the increased cardiovascular risks of the drug, but played them down to doctors and patients.
The Australian court also heard evidence that a Stanford University medical professor, James Fries, wrote in 2000 to Merck’s then-CEO Ray Gilmartin to complain about the treatment of at least eight of his researchers who criticized the drug. “Even worse were allegations of Merck damage control by intimidation,” he wrote. In his letter, Fries said the intimidation “seriously impinges on academic freedom.”
In a statement, Merck’s Australian subsidiary, Merck Sharp & Dohme, said, “We believe the evidence will show that the companies acted responsibly and that Vioxx was not the cause of [the lead plaintiff’s heart attack].”
The pollution that is currently endangering the environment is also endangering public health, according to an April report by the American Lung Association. Six in 10 people in the United States live in areas where air pollution threatens lives, according to the Association’s 10th annual “State of the Air” report.
“This should be a wakeup call,” says Stephen Nolan, American Lung Association national board chair. “We know that air pollution is a major threat to human health. When 60 percent of Americans are left breathing air dirty enough to send people to the emergency room, or shape how kids’ lungs develop, and to kill, air pollution remains a serious problem.”
The report noted that despite measures implemented across the United States to stem air pollution, many cities actually became more polluted over the past year. Measuring ozone or smog, annual particle pollution and short-term particle pollution, the report found that the air pollution in nearly every major U.S. city is at unhealthy levels.
When inhaled, ozone irritates the lungs and can have immediate detrimental health effects, including wheezing, coughing and asthma attacks, according to the American Lung Association. The report found that 58 percent of people in the United States live in counties with too many days with unhealthy ozone levels.
Particle pollution, the “most dangerous and deadly” outdoor pollutant, according the American Lung Association, is caused by soot, diesel exhaust, chemicals, metals and aerosols, and can increase the risk of “early death, heart attacks, strokes and emergency room visits for asthma and cardiovascular disease.” One in six people in the United States lives in an area with unhealthy annual levels of particle pollution, the report found.
Los Angeles ranks as the top city polluted by unhealthy ozone levels. Pittsburgh is the top city polluted by particle pollution.
“America needs to cut emissions from big polluters like coal-fired power plans and ocean-going vessels,” says American Lung Association President and Chief Executive Charles Connor. “We need to fix old dirty diesel engines to make them cleaner and strengthen the ozone standards to better protect our health. ... America must now enforce the laws that help us improve our nation’s air quality.”
No Legal Fees for Chevron
A federal judge in April denied Chevron’s request to be reimbursed nearly $500,000 from the group of Nigerian villagers who recently lost their human rights case against the oil behemoth. Chevron argued the villagers should pay it’s legal fees associated with a lawsuit that alleged the company facilitated the 1998 shooting of unarmed protesters on an oil platform in Nigeria. Chevron was found not liable in December 2008.
Chevron’s claim for $485,000 included $190,000 in copying charges. The total amount would be enough to sustain at least four villages in the Niger Delta for a year, according to advocacy group Justice in Nigeria Now.
“The economic disparity between plaintiffs, who are Nigerian villagers, and defendants, international oil companies, cannot be more stark,” wrote Judge Susan Illston in her brief denying costs to Chevron.
Chevron posted a record $23.9 billion profit for 2008. By contrast, Illston noted, of the plaintiffs in the case, one worked at a gas station, earning about $100 a month, another operated a kerosene business, earning about $867 a month, and others worked in odd jobs earning about $60 a month. Ten of the plaintiffs were children.
“While Chevron never expected the plaintiffs to pay these costs themselves,” the company said in a statement, “there would have been true justice if the contingency fee lawyers and advocacy groups whom we believe conceived, drove and funded the litigation, bore some of the costs. The lawyers certainly spared no expense in pursuing meritless claims against Chevron for 10 years, which a federal jury unanimously rejected.”
However, Judge Illston was concerned that awarding costs would deter future human rights litigation. “At root, this case was an attempt by impoverished citizens of Nigeria to increase accountability for the activities of American companies in their country,” Illston wrote. “Plaintiffs’ ultimate failure at trial does not detract from the fact that this was a civil rights case. The threat of deterring future litigants from prosecuting human rights claims ... is especially present in a case such as this, where plaintiffs have paltry resources and defendants are large and powerful economic actors.”
Minnesota’s BPA Ban
Minnesota in May became the first state to ban bisphenol A (BPA) from all plastic baby bottles and cups starting in 2011. BPA is a chemical building block used to make some plastics that has been linked to a variety of serious health effects, including damage to infant reproductive, neurological and immune systems. In children and adults, BPA is thought to cause cancer, cardiovascular disease, diabetes and reproductive abnormalities.
“Given the existing and growing body of scientific knowledge about the health risks of BPA to consumers — and the growing consumer and industry movement against this chemical — we strongly support Minnesota’s action to protect public health and ban BPA from baby bottles and drinking containers,” says Urvashi Rangan, technical director for policy at Consumers Union, the nonprofit publisher of Consumer Reports. “Some companies are already moving ahead to remove BPA from the marketplace, but nationwide consumers will remain at risk until federal action is taken.”
Six of the largest baby bottle manufacturers announced in March they will no longer sell bottles made with BPA. Large retailers including Toys ‘R’ Us, Safeway, Target, CVS and Walmart are currently phasing out selling baby bottles with BPA.
In addition, New York’s Suffolk County passed a law in April to ban BPA. Chicago became the first city to ban BPA in May. California, Connecticut, New York and Michigan are also considering BPA bans.
However, Consumers Union stresses that federal action is still needed. As recently as August 2008, the U.S. Food and Drug Administration (FDA) maintained that BPA was safe for humans. After a barrage of criticism from the scientific community, including its own Science Advisory Board, in February the FDA acknowledged that BPA posed serious health concerns, but it has yet to agree that public health safeguards should be implemented.
Billions for Biofuels
The biofuels industry will receive at least $420 billion in subsidies in the United States between 2008 and 2022, according to an April report by Friends of the Earth. The report found that the bulk of the subsidies are going to the most environmentally harmful biofuels — such as ethanol, which is receiving 40 percent of the total subsidies — and could lead to devastating ecological effects both in the United States and abroad.
“The size of these subsidies is extraordinary, particularly given how poorly we screen the environmental impacts produced by their recipients,” says report author Doug Koplow of Earth Track. “The subsidies are accelerating environmental damage. There are far better ways to spend this money.”
U.S. biofuels subsidies fall under two main categories, the Renewable Fuels Standard and tax credits, according to the report. The Renewable Fuels Standard will require the annual production and blending of 36 billion gallons of biofuels by the year 2022 and give more than a dollar for every gallon of biofuels, allowing fuels into the marketplace that would otherwise be too uneconomical to compete.
Tax credits to biofuels, coming from both state and federal governments, include the Volumetric Ethanol Excise Tax Credit, which gives the industry nearly 50 cents for every gallon of ethanol produced. The report cautions that the incentives for farmers to cultivate corn will grow to such an extent that the government will then have to boost subsidies for other crops to make those as profitable as the subsidized corn — sending even more money from taxpayers to the agribusiness industry.
“For this investment, we accelerate land conversion and exacerbate a wide range of environmental problems,” states the report. “Already, the ecological impact of increased biofuels production is evident, both in the U.S. and abroad, including deforestation, water pollution and increased greenhouse gas emissions.”
Rather than reducing greenhouse gas emissions, many biofuels actually release more greenhouse gases than gasoline or diesel, when land use changes such as deforestation are factored in.
“The overall bottom line is biofuels are not fulfilling their promise. We need to recognize that and accept that and change our policies,” says Kate McMahon, biofuels campaigner at Friends of the Earth. “We don’t need to be incentivizing dirty fuels.”
— Jennifer Wedekind