Signs of the Times

[posted on corp-focus, July 28, 2006]

By Russell Mokhiber and Robert Weissman

Using a statistical lens, two just-released books shed light on the ravages of corporate globalization.

Vital Signs 2006-2007 from the Washington, D.C.-based WorldWatch Institute contends that “the health of the global economy and the stability of nations will be shaped by our ability to address the huge imbalances in natural resource systems.”

The Least Developed Countries Report 2006, issued by the United Nations Conference on Trade and Development (UNCTAD), argues that while there have been relatively higher rates of economic growth in the Least Developed Countries (LDCs, a UN-designated group of the world’s poorest 50 countries), it is “not translating into poverty reduction and improved human well-being.”

Here are 20 factoids from the reports, the first 10 from Vital Signs, the second 10 from The Least Developed Countries Report:

1. Global oil consumption in 2004 was 3.7 billion tons, about eight times more than in 1950. Coal consumption was two-and-a-half times more than 1950, and natural gas more than 15 times greater.

2. 2005 was the warmest year ever recorded on Earth. Atmospheric concentrations of carbon dioxide reached 379.6 parts per million for 2005.

3. Thanks largely to Hurricane Katrina, weather-related disasters caused more than $200 billion in damage, nearly double the previous record. Three of the 10 strongest hurricanes ever recorded occurred in 2005.

4. More money was spent on advertising in 2005 than ever before — $570 billion, about half of which was spent in the United States. The global figure is 11 times more than was spent in 1950, measured in constant dollars.

5. More than 37 million people have died from AIDS over the last two decades.

6. The world’s governments spent more than a trillion dollars on the military in 2004, the highest figure since the end of the Cold War.

7. An estimated 20 percent of the world’s coral reefs have been effectively destroyed.

8. Twelve percent of all bird species are threatened.

9. A billion people worldwide live in slums.

10. More than 300 million people worldwide are obese. U.S. obesity levels have doubled since 1990, to about 40 percent. Chinese levels have doubled during the same period, now standing at 7 percent.

11. Per capita, for every 100 researchers and scientists doing R&D in rich countries, there are only two in LDCs.

12. In 2004, LDCs had a combined trade deficit of $6.5 billion. Exclude the oil exporters, and the combined deficit was $18.6 billion — more than 50 percent of the size of non-oil-exporting LDCs’ exports.

13. LDCs imported $7.6 billion in food in 2003, while exporting only $2.2 billion worth of food.

14. The average years of schooling in LDCs is three years.

15. About one-in-five high-skill workers in LDCs (defined as some college or technical school education) was working in a rich country in 2000.

16. Thanks to International Monetary Fund and World Bank structural adjustment programs, governments in LDCs are only half the proportional size of rich country governments, with LDCs devoting only 3.5 percent of their national economy (GDP) to state administrative services.

17. Between 1991 and 2004, only 20 U.S. patents were granted to citizens from LDCs, compared with 14,824 from other developing countries, and 1.8 million to citizens of rich countries.

18. Labor productivity in LDCs is one-ninety-fourth the level of rich countries.

19. There are 3 percent as many phone lines per person in LDCs as in rich countries.

20. LDC energy consumption is 1.6 percent the level of rich countries.

Not all the news is so bad. Malnourishment is declining quickly in about a third of LDCs. Globally, infant mortality is at a record low — although gains are coming very slowly in the poorest countries. (Only four LDCs are on target to meet the Millennium Development Goal target of reducing under-five mortality by two-thirds by 2015.) Bicycle production is rising rapidly, with 101 million bikes manufactured in 2003 (the latest year for which data is available), nearing record levels. Global production of photovoltaic cells — which generate electricity from sunlight — increased 45 percent in 2005, with current levels six times the amount produced in 2000.

Overall, however, there’s no way to look at the data in these two books and conclude anything but that the current way of doing things is not working.

Russell Mokhiber is editor of the Washington, D.C.-based Corporate Crime Reporter, . Robert Weissman is editor of the Washington, D.C.-based Multinational Monitor, . Mokhiber and Weissman are co-authors of On the Rampage: Corporate Predators and the Destruction of Democracy (Monroe, Maine: Common Courage Press).

(c) Russell Mokhiber and Robert Weissman

Wal-Mart refuses to accept unions, regulations, leaves Germany

Just as the Cheney-Bush White House seems to have a principled commitment to secrecy and the concentration of power — even when it serves no apparent purpose and generates lots of opposition — so too does Wal-Mart seem unwilling to make profits if doing so means the retail giant has to accept unions and some regulatory rules.

Today’s evidence: Wal-Mart has announced it is pulling out of Germany, at a $1 billion loss.

“It has become increasingly clear that in Germany’s business environment it would be difficult for us to obtain the scale and results we desire,” stated Michael Duke, Wal-Mart vice chair. “This sale positions us to increase our focus on the markets where we can achieve our objectives.”

The Financital Times reports here.


By Russell Mokhiber and Robert Weissman

What a sight.

Here you had Dr. Glenn Forbes, CEO of the Mayo Clinic, one of the most powerful institutions — and the largest employer — in Minnesota.

And standing next to him is Stephen Ryan — a partner at Manatt Phelps & Phillips — one of the most powerful law firms in Washington, D.C.

And next to Forbes and Ryan is the retiring Senator Mark Dayton, D-Minnesota.

All gathered last week at the Zenger Room in the National Press Club to hold a press conference.


Running right next to the Mayo Clinic campus in Rochester is a rail line.

And a small railroad — the Dakota, Minnesota & Eastern Railroad (DM&E) — with powerful political connections wants a $2.5 billion loan from the federal government.

DM&E’s president Kevin Schieffer wants to turn his little $220 million-a-year pipsqueak railroad into a major $1 billion-a-year coal-carrying behemoth.

He wants to carry the mega-tonnage of coal from the Powder River Basin in Wyoming through South Dakota and Minnesota and on to Chicago and then to coal-burning plants throughout the United States. The 2,800-mile line would run right through Rochester, Minnesota. Home to the Mayo Clinic.

And so, Dayton, and Forbes and Ryan gathered last week at the National Press Club to make their points to the national media.

The DM&E is an unsafe railroad, they said. In fact, they claim it has the worst safety record in its class of railroad. They say its accident record is more than double that of all railroads in its class. And it is one of only two railroads in America operating under a safety compliance agreement the Federal Railroad Administration.

Yes, its rail line currently runs right next to the Mayo Clinic. Trains run by there now, they concede — but at a slow speed — 10 to 15 miles per hour. If the company gets the loan to upgrade the line, the trains will run much faster than they run now — 40 to 50 miles per hour.

In addition to carrying coal, they will carry hazardous materials. What if this accident-prone railroad has a hazmat accident, and there is a spill, or an explosion? Our patients, who fly here from around the world, would be put at risk. Can’t you see?

And then Stephen Ryan of Manatt Phelps slaps DM&E with a Red Card: “This is an island of socialism in a sea of capitalism.”

By which he means that DM&E is seeking a $2.5 billion government loan.

And so we asked Manatt’s Ryan: Mr. Ryan, Manatt Phelps is a powerful Washington, D.C. law firm.

Isn’t it conceivable that Manatt Phelps has in the past represented other corporate entities who have sought bailouts from the federal government?

“No,” Mr. Ryan says.


A five-second search found at least one example — Manatt represented US Airways before the Congress in the post-9/11 bailout of the airline industry.

Maybe it’s just a sea of corporate socialism?

Senator Dayton made his statement in defense of Mayo and in opposition to the federal loan to DM&E — but then Ryan announced that the senator was too busy to take questions. Maybe that’s because of something the Senator said to Fortune magazine earlier this year: “The Mayo Clinic is worth a hell of a lot more than the whole state of South Dakota.”


Dayton is retiring at the end of this year.

No harm, no foul.

And by the way, South Dakota does have its fingers all over this pie. South Dakota Republican Senator John Thune is a big supporter of the government loan. Before becoming a Senator, DM&E was a big Thune lobbying client. And when he became senator, Thune authored the legislation that would grease the skids for the loan from the Federal Railroad Administration.

DM&E President Schieffer himself was an aide to former South Dakota Senator Larry Pressler — where he was introduced to railroad issues.

Former Senate Minority Leader Tom Daschle, D-South Dakota, sits on Mayo’s board of directors.

And on and on.

Another thing that concerns Manatt’s Ryan is that DM&E is privately held. He’s not sure who the investors are. He speculates: Are they from the Gulf?

And Mr. Ryan doesn’t mean the Gulf of Mexico. He means the Arabian Gulf.

And so we ask — is there any indication that there is foreign ownership of DM&E? “No,” Ryan says. “We just don’t know who owns it.” And there’s no way to find out.

They could get the $2.5 billion from the taxpayers — and then sell off the company.

We ask Dr. Forbes — aren’t you also concerned about the trucks carrying hazardous materials through the heart of Rochester?

Yes, of course he is.

But then Ryan interjects — of course, but we’re dealing with a railroad here — they carry bigger volumes — therefore bigger accidents are possible.

Mayo could perhaps show its bona fides on this issue by supporting a national program to transition to a solar economy — a legitimate public health position — rather than just objecting to the particular rail route.

As for Manatt, well, its pretense of principle in this dispute is preposterous. And not just because of its corporate welfare hypocrisy.

DM&E’s main cargo is coal. Which mega-law firms represent the coal industry? One of them is Manatt Phelps & Phillips, which advertises that it has BHP Billiton — one of the world’s largest coal companies — as among its clients. Manatt fights for whoever pays.

It’s a sleazefest all around.

But in this fight, put your money on Mayo.

Big powerful Mayo trumps a tiny little railroad every day.

Maybe not the trucking industry.

But a railroad company?

No problem.

Plus, there’s an alternate route.

At the press conference, Ryan said the trains could cut south at Winona — before they get to Rochester.

An aide whispers in his ear.

Whoops — I’m sorry, not Winona — Owatonna, Ryan says.

The trains could cut south at Owatonna.

Don’t pass Rochester.

Don’t collect $2.5 billion.

Deliver the coal to the coal-fired plants.

Warm the globe, but take care of the client.