The Multinational Monitor

June 1992

Pillage in the Pacific

Table of Contents

Behind the Lines


Selling Pollution

The Front

The Return of PowerMaster


Assault on Papua New Guinea

By David Minkow and Colleen Murphy-Dunning

Comalco’s Power Play

By Murray Horton


Crushing Labor in New Zealand

By Robert Reid


The Politics of Race and Pollution

An Interview with Robert Bullard


Plastics: Trashing the Third World

By Anne Leonard

Names In the News

Book Review




To the editor:

You should know how much I appreciate the Multinational Monitor. It is most timely in this period of world-wide growth and greed.

The April 1992 issue promoting new energy directions focuses on an issue that I consider essential for survival of this planet - safe, renewable energy. The Gulf War to protect U.S. access to oil, and the Administration’s continued commitment to nuclear power despite the hazard of nuclear waste disposal are examples of multinational policies that make us an endangered species.

I promote solar, wind and hydrogen power whenever I can. The Multinational Monitor will be a wonderful new resource.

With appreciation and admiration.

Maggie Kuhn

Gray Panthers

Philadelphia, PA

To the editor:

Your editorial "A Wrong Step" (April 1992) likewise strays from the straight and narrow when, in describing the road to a safe energy future, it states, "Down the road, the goal should be decentralization..."

Like many other left-wing/environmental publications, MM perpetuates the notion that decentralization is merely a possible "fringe benefit" of solar energy. In fact, community control of energy production and distribution is the means of obtaining a solar future, and it is this very fact that contributes to solar’s unpopularity among the powers that be.

Consider some basic questions. Given the overwhelming benefits of solar energy, why aren’t we using it more? Is it because Secretary of Energy Watkins doesn’t know that nuclear energy is dangerous? Doesn’t George Bush know that solar energy doesn’t have to be imported? If we write to Congress enough, will they achieve for us a self-reliant, safe energy future?

If we are to save the planet (and ourselves) we have to gain control over our technology choices. The environmental and economic dilemma we are in is not due to choosing the wrong technologies. The right technologies were chosen - by and for the people who benefited from them. We cannot rely on the Department of Energy, the President or Congress to make the switch for us to solar energy, just as we cannot rely on Exxon to start manufacturing solar panels. The issue is not "clean" energy versus "dirty" energy, or safe energy versus unsafe energy. The issue is, who is making our technology choices and who is benefitting from them.

Eric Weltman

Washington, DC

Behind the Lines

Ravenswood Victory

THE UNITED STEELWORKERS OF AMERICA (USW) are on the verge of scoring a significant victory for labor unions in the battle against business’s "permanent replacement" strategy. One thousand seven hundred West Virginia steelworkers, locked out of their jobs at Ravenswood Aluminum Corporation (RAC) in November 1991, may soon be back on the job, according to union spokesperson Charles Robb.

Ravenswood declared contract negotiations with the USW stalemated after workers rejected a company proposal, made only seven days before the contract expired, that would change seniority rules, eliminate a cost-of-living adjustment and eliminate additional pay that was tied to high profits. The union says the company intended all along to replace the union workers. RAC sent union workers home minutes before the old contract expired, and brought in the first crew of 100 permanent replacement workers - who had already been recruited and trained. Eventually, the company brought in about 1,000 permanent replacements.

The USW launched an aggressive campaign against the company and its permanent replacement tactic. Almost all of the union workers held out for all 18 months of the lockout, with only 17 crossing the picket lines to go back on the job. The USW threatened major buyers such as Coca-Cola and Anheuser-Busch with boycotts unless the companies stopped using Ravenswood aluminum. The union also discouraged foreign banks and governments from doing business with Mark Rich, a commodities broker and the real power behind RAC.

The chair of the company, R. Emmett Boyle, has been dismissed, and other top company officials have left Ravenswood. Ravenswood is in "bad financial condition" because of the work stoppage, says Robb. The union is currently negotiating with the company for a new contract. Robb says that while the union is addressing "a wide range of issues including wages, insurance and pensions," the main issue remains "getting the replacement workers out and our people in."

Patently Unfair

THE BUSH ADMINISTRATION is using trade measures to punish developing countries which refuse to adopt U.S.-style intellectual property protection measures. In May, the U.S. Trade Representative (USTR) designated India , Taiwan and Thailand as "priority foreign countries" under the Special 301 provision of the 1988 Trade Act. Special 301 directs the USTR to impose tariffs on countries that it determines are engaging in unfair trade practices by not offering strong enough intellectual property protection.

Bush also suspended India from the Generalized Systems of Preferences program, which allows developing countries to ship products duty-free into the United States, on the grounds that it affords inadequate intellectual property protection. The action will cost India about $60 million in benefits, according to USTR.

The Pharmaceutical Manufacturers Association applauded the administration’s moves in its May 4 newsletter, which also blasted India for playing "a nefarious role in undermining U.S. goals and objectives in intellectual property negotiations of the current Uruguay Round of the GATT [General Agreement on Tariffs and Trade]."

However, critics of U.S. trade policy say that loose patent protection laws benefit Third World consumers and producers. The 1970 Indian Patents Act was designed to encourage domestic production of patented inventions and insure that the products were made available at a reasonable price. Since the adoption of the Act, India’s drug prices have dropped to among the lowest in the world and the country has become nearly self- sufficient in the production of bulk drugs [see Tripping the Third World," Multinational Monitor, November 1990 ].

Oppression in Malawi

TRADE UNIONISTS FROM AROUND THE WORLD are protesting human and labor rights violations in Malawi and calling for the release of union leader Chakufwa Chihana, who has been held without charges since April 6. Chihana, who heads the Southern Africa Trade Union Coordination Council, is a long-time leader of Malawi’s democracy movement, and was jailed for six years in the 1970s for his advocacy of workers’ rights. Riots and protests broke out in Malawi in early May against the repressive policies of President Hastings Bunda.

Many African labor organizations have called for an end to political repression in Malawi. The major South African trade union federation, COSATU, has called on the South African government to suspend trade with Malawi until Chihana is released.

In the United States, the AFL-CIO’s Executive Council released a statement urging "the U.S. government and the governments of all other developed countries to withhold economic assistance to Malawi until Brother Chihana is released, repression ends, and current anti-democratic policies are reversed." According to the AFL-CIO’s information office, the council has also resolved to press the U.S. Trade Representative to suspend Malawi from the Generalized System of Preferences program.

- Holley Knaus

Editorial: Selling Pollution

IN EARLY MAY, accompanied by great media and corporate fanfare about the wonders of using market forces to control pollution, the Wisconsin Power and Light Company sold "pollution credits" - in effect, a licence to spew out sulfur dioxide - to the Tennessee Valley Authority (TVA), an electricity utility serving Tennessee, Alabama and Kentucky. For about $3 million, TVA purchased the right to emit an additional 10,000 tons of sulfur dioxide, the chemical which is the primary cause of acid rain, from the Wisconsin utility.

The deal is the first to be implemented under the pollution credit trading system authorized by the 1990 Clean Air Act. The Act granted plants pollution allowances which set ceilings on the amount of sulfur they will be able to emit after 1995. If a plant reduces its emissions more than is required by the law, it can sell its "extra" emissions reductions - or "unused credits" - to another plant that fails to reduce its emissions to the required level.

The concept was most recently proposed by Dan Dudek of the Environmental Defense Fund (EDF), which pushed the concept with the Bush administration. EDF defends the plan, saying that the emissions trading provision in the Clean Air Act paved the way for a reduction requirement that was tougher than what President Bush would otherwise have agreed to accept. But compromise is often the first step to corruption, and the pollution credits deal advocated by EDF has the potential to do more harm than good for the environment.

Pollution credits serve the interests of polluting utilities, at the expense of consumers, the environment and public health, in several ways:

o Pollution credits undermine positive effects of straight regulation. In the past, when governments mandated lower pollution levels, they forced companies to develop and adopt cleaner technologies because that was the only way to meet the government requirements. Under the credit system, instead of buying smoke scrubbers, companies buy the right to pollute.

o Pollution credits work against the future reduction of emissions. Although credits are not legally property rights, they are effectively property rights that will make further sulfur reductions much more difficult. The government should be constantly moving to reduce emissions, not guaranteeing companies the right to pollute for an indefinite period of time.

o Because allowances are based on past fuel use and emissions rates, companies that were wasteful of fuel and, in some cases, companies that polluted excessively, received the biggest allowances. It is then possible for these companies to profit most by selling credits.

o Cleaner air in Wisconsin comes to mean more pollution in Tennessee. Even if the system does reduce overall sulfur emissions, it allows some companies to continue emitting pollution. Companies that are doing well can afford to buy the right to pollute, and people living around their plants continue to breathe in toxic fumes. A system intended to control pollution should not force a trade-off between reducing acid rain and protecting the general public health.

o Credits were granted to companies in existence at the time of the 1990 Clean Air Act. Since the right to emit pollution has in effect been turned into a commodity, this means that the federal government simply handed over assets of considerable value to these utilities.

o The system does not even stop the acid rain as it is intended to. Even if some companies in a region clean up, others in the area may choose to buy credits to allow them to emit pollution that continues to cause acid rain.

This bad idea is spreading: Southern California has implemented a similar program in an effort to reduce smog-causing emissions; Canada is considering pollution trading for air and water emissions; the United Nations has even tossed around the notion of setting up a global market in which greenhouse gas credits would be bought and sold. The TVA/Wisconsin exchange sets a dangerous precedent.

The Clean Air Act pollution credits program is based on the fundamentally flawed premise that a certain level of pollution is acceptable. As Chris Blythe of Wisconsin’s Citizens Utility Board says, "Clean air should be protected, not traded and sold like a used car. What’s next - the Los Angeles Police Department trying to buy civil rights credits from Wisconsin?"

The value of human health and the environment cannot be determined by market forces. It is no surprise that the idea plays well with the Bush administration and anti- regulation big business, but an environmental organization like EDF is tainted by pushing a plan which accepts the health and environmental costs associated with pollution.

Most environmental organizations oppose this EDF initiative. U.S. citizens should demand strict limits on polluting sources, much stronger emphasis on pollution prevention, moves toward a total elimination of emissions and the abandonment of a system that turns harmful sulfur fumes into valuable assets. Creating a market in pollution will never clean the air.

The Front

The Return of PowerMaster

G. HEILEMAN BREWING COMPANY is targeting "the black male population with another high-alcohol-content product," says Reverend Jesse Brown of the Philadelphia-based National Association of African- Americans for Positive Imagery.

Heileman came under fire last year from public health advocates and African- American religious and community leaders for introducing PowerMaster, a malt liquor with the highest alcohol content of any malt on the market. Heileman primarily pushed PowerMaster in African-American neighborhoods. In July 1991, the Bureau of Alcohol, Tobacco and Firearms (BATF) ruled that the "PowerMaster" name violated federal rules that prohibit alcohol container labels or product advertisements from touting the strength of a product. Heileman pulled PowerMaster off the market in the wake of the BATF decision and the public furor sparked by Heileman’s blatantly racist marketing strategy [see Corporate Crime and Violence in Review," Multinational Monitor, December 1991 ].

But Heileman has not given up on selling a potent product to a minority community already plagued by alcohol-related disease. Now, says Brown, "They are re- packaging [PowerMaster], but they are after the same market."

The high-alcohol formulation of Heileman’s Colt 45 Premium, currently in liquor stores in Philadelphia and soon to be sold in Detroit, is at least similar to PowerMaster’s. BATF reported in early May that the two products have identical formulations, but now a spokesperson says that the agency may not have had complete information in making that determination, and that information concerning similarities in the products’ formulations is currently "not disclosable." The company has maintained that the formulations are not identical.

Colt Premium is being sold in the old PowerMaster container - a black can emblazoned with a red horse. And it does have a similarly high alcohol content: malt liquors typically contain about 4.5 percent alcohol, compared to 3.5 or 4 percent for other beers. Colt Premium has an alcohol content of 5.9 percent.

Critics also charge that Heileman is marketing Colt Premium the same way it marketed PowerMaster: by targeting low-income, male African-Americans. The malt’s slogan - "Be A Premium Player" - and the can itself are designed to serve as "enticements or inducements" for young, black males to try the product, says Brown, who points out that the word "player" is often associated with inner-city gangs. Brown notes that Colt 45 Premium will also be associated with another Heileman brew, the less potent Colt 45, which is pushed in advertisements by popular African-American celebrities such as Billy Dee Williams.

Heileman could not be reached for comment on charges that it is targeting young, black males with a uniquely potent malt liquor.

Brown says that Heileman is targeting a community that already suffers a "disproportionate burden of alcohol-related diseases and social problems." African- Americans account for 18 percent of the clients in alcohol treatment programs, yet make up only 12 percent of the U.S. population. African-Americans in the United States are also twice as likely as whites to die of chronic liver disease or cirrhosis. David Grant of the Minneapolis-based Institute on Black Chemical Abuse says, "The people who are being hit the hardest by high-octane alcoholic beverages are the very market for which these products are intended."

Grant says that people of color working to stem substance abuse in their communities "are disgusted" by Heileman’s strategy. "The same kind of racism is at work here that is at work in society as a whole," says Grant. "It sees black life and the lives of other people of color as intrinsically less valuable than the lives of European-Americans."

Heileman is after other minority populations as well. Critics, including Surgeon General Antonia Novello, who also spoke out against PowerMaster, say that the company is employing a racist strategy to market yet another high-alcohol malt liquor to Native Americans. Brown says that the recently introduced Crazy Horse malt liquor "is highly attractive to Native American kids," at least in part because of the images of rebellion associated with the historical figure of Crazy Horse. Grant calls the Crazy Horse campaign "a cynical attempt to use a very similar marketing approach" which "ties the use of the product in with a celebration of Native American heritage." Grant adds, "If Crazy Horse were alive today, he would be leading the demonstrations against the product" because he "hated anything that denigrated Indian culture."

Members of Philadelphia’s health and religious communities are leading the fight against PowerMaster. Brown, in particular, is experienced in fighting racist corporate marketing, having led the campaign against R.J. Reynolds when the company tried to market its Uptown cigarette exclusively to African-Americans. Reynolds eventually cancelled the product.

Grant is heartened by the success of Brown and other minority leaders whose work led to the dumping of both Uptown and PowerMaster. "We are going to remain vigilant" in fighting Colt Premium and Crazy Horse, he says. "We are not powerless here."

- Holley Knaus


Pillage in the Pacific

by David Minkow and Colleen Murphy-Dunning

MORESBY, PAPUA NEW GUINEA - Outsiders didn’t discover Papua New Guinea (PNG) until the sixteenth century and didn’t begin developing this lush, mountainous country until the nineteenth. But foreign companies, realizing the opportunity to exploit one of the world’s last great natural treasures, are making up for lost time: they are well on their way to destroying Southeast Asia’s largest remaining rainforest, as well as more than 700 distinct cultures.

These multinational corporations - among them Amoco , CRA and Chevron - are operating with the approval of the PNG government. A crippling foreign debt of $2.5 billion has driven the government to trade the country’s natural resources for short-term and short-sighted gains. Raw materials such as minerals, timber and oil account for almost all of the country’s export earnings.

"The interests of our people are paramount and any decision to conserve forests must be weighed against their need for development," Forests Minister Jack Genia once rationalized.

Fed unrealistic and often unrealized promises by multinational companies and their government, the people of PNG have been persuaded to sell off their resources and livelihoods.

PNG’s robber baron era

The PNG government has developed stringent environmental and social standards for foreign investors, but it is so dependent on earnings from resource extraction that it often makes exceptions to the rules, and its primary efforts are devoted to attracting foreign investment. In October 1991, for example, the PNG government hosted a series of seminars in Canada and the United States for potential investors interested in developing PNG’s mineral and petroleum resources. The government hoped to restore investor confidence in the country, which has been shaken by a series of violent attacks by local residents on large-scale development projects. The investors are largely responsible for these reactions, having ignored the needs and ways of the local PNG people.

PNG’s unique land tenure system - local clans own 97 percent of the land communally - contrasts dramatically with the highly unequal land distribution patterns found throughout much of the Third World. Communal ownership could provide the foundation for genuine sustainable development, based primarily on people producing food and goods for their own needs. Instead of taking advantage of the land tenure system, however, the PNG government has encouraged landowners to form landowner associations, organizations which can enter into contractual agreements with multinationals. Through the Timber Rights Purchase process, the government negotiates with the landowners on behalf of interested corporations; the government then strikes its own deal with the companies, so that both the association and the government receive royalties from the corporations.

The process is rife with abuse. In 1987, the government asked Judge Thomas Barnett (an Australian by birth but a long time PNG national) to oversee a commission of inquiry into the timber industry. The Barnett Inquiry found that Japanese companies, which comprise 90 percent of the timber industry in PNG, had bribed PNG officials to allow them to export more logs than was contractually permitted. In addition to cheating landowners of royalties and benefits, these companies defrauded the government of timber royalties, export duties and tax revenues.

"It would be fair to say, of some of the companies, that they are now roaming the countryside with the self-assurance of robber barons: bribing politicians and leaders, creating social disharmony and ignoring laws in order to gain access to, rip out and export the last remnants of the province’s valuable timber," the Inquiry concluded. "It downgrades Papua New Guinea’s sovereign status that such rapacious foreign exploitation has been allowed to continue with such devastating effects on the social and physical environment, and with so few positive benefits." The Inquiry resulted in the resignation of Deputy Prime Minister Ted Diro, who was found guilty of 86 counts of corruption and other misconduct.

In July 1990, the subject of increasing international attention, PNG placed a two- year ban on new logging permits.

Yet logging on PNG is accelerating. Understaffed, underfunded and undermined by corruption, the PNG government has made many exceptions to the moratorium. The government has also allowed companies found guilty by the Barnett Inquiry of violating agreements and PNG law to continue to operate, under new names.

Yalaum Mosol, a spokesperson for the Bemal village in Madang, describes the effects of unchecked logging in his region. Japan and New Guinea Timbers (JANT), a wholly owned subsidiary of the Japanese Honshu Paper, has been clearcutting for pulp in the Madang area. "We have no water to wash in, and hardly any water to drink that is not polluted. We have no good ground left on which to grow food. We have no mushroom ground, no good trees for fruit, no clay-pot ground. Our secret places and wild animals are gone, and all our ancient big trees are being destroyed."

Poorly compensated for the destruction of their way of life, frustrated PNG citizens have resorted to taking matters into their own hands.

Bougainville: worst-case scenario

The closing of a mine which polluted the environment and was operated by a company that ignored the needs of local people sounds like a complete victory for both the environment and the local people. But it is much more complicated than that.

What has happened on Bougainville Island, a coastal island 500 miles northeast of PNG and home to the Panguna copper and gold mine, is a tragedy.

From 1972 to 1989, CRA, a subsidiary of the British mining giant Rio Tinto Zinc Corporation, discharged mine tailings directly into the Jaba and Kawerong rivers, killing most aquatic life. In some places, waste rock raised the Jaba River bed by 40 meters.

The PNG government allowed this to happen, ignoring a long list of the landowners’ grievances. The landowners were upset that they received less than 1 percent of mining profits, while the government got 58 percent. In 1988, the landowners demanded that CRA agree to renegotiate the Bougainville Copper Mining Agreement, which included a provision calling for review every seven years. The landowners also demanded $11.5 billion for environmental and social damages.

After waiting a year for a response, mine employee Francis Ona formed the Bougainville Revolutionary Army (BRA), which waged a bloody sabotage campaign against the mine. At the end of 1989, CRA closed Panguna.

The PNG government responded harshly to the BRA, since the Panguna closing has deprived the country of 40 percent of its export revenues.

In 1989 and 1990, PNG military forces destroyed thousands of Bougainville village homes and commited widespread human rights violations. In March 1990, the PNG government withdrew its military forces as well as all government service providers. In April 1990, PNG imposed a total embargo on all medical and other supplies destined for Bougainville. Bougainville representatives claim thousands have died as a result.

In May 1990, Bougainville declared independence, but PNG refuses to recognize the declaration. PNG subsequently attempted to reinvade the island, and now maintains military control over its northern tip. The embargo continues.

There is talk of reopening the mine, but it would take an estimated 2 years and 300 million Kina (1 Kina = US$1.05) to do it.

The lost Bougainville revenues have severely affected PNG’s finances, compelling the government to step up other projects and devalue the Kina by 10 percent.

Chevron: false savior

The PNG government is banking on the Kutubu oil project, run by San Francisco- based Chevron, to help make up for the Bougainville loss. Chevron expects this venture to produce 170 million barrels of oil over a 10-year period.

The project site is located in a pristine area near Lake Kutubu, a region that was first reached by foreigners in 1936. Chevron expects to spend about $1.4 billion before the project extracts any oil. The Kutubu project includes construction of a 163-mile-long pipeline, which extends through one of the largest expanses of mangroves in the world, a tanker-loading buoy, a mile-long airstrip, a 65-mile road and a network of roads from the well sites to the central processing facility.

The government requires investors to prepare environmental impact statements for potential projects, but George Marshall, director of the London Rainforest Action Group, criticizes Chevron’s statement. "The chances of a major accident are suspiciously played down. ... Were there to be a major accident, neither the company nor the government have the facilities to deal with it," Marshall says.

The landowners are seeking higher royalties from the government; they are currently receiving only .31 percent of the well-head value. They also complain that Chevron has not met its promises to provide roads, jobs, tree compensation, schools and health facilities.

A leader from Wasemi village says, "We’ve just about had it. We want our services before Chevron pumps out oil." Fears of Bougainville-like disruptions have prompted security measures at the project site.

Environmentalists, both in and outside of PNG, are calling for an independent environmental impact assessment that examines the potential impact of pipeline leaks from Chevron’s project. They fear recurrences of "unforeseen" environmental catastrophes associated with past development projects in PNG.

Ok Tedi is not okay

One of those projects is the Ok Tedi mine, located near the Irian Jaya border. A 1989 landslide destroyed a temporary tailings dam that prevented the release of waste rock from the mine into the Ok Tedi River. Ok Tedi Mining Limited (OTML), which operates the mine, contends that it does not make economic sense to build another dam in such an unstable area, so the company now dumps 80,000 tons of sediment into the river each day. OTML is jointly owned by U.S.-based Amoco (30 percent), the Australian Broken Hill Proprietors (30 percent), the PNG government (20 percent) and a German consortium (Degussa - 7.5 percent, Metallgesellschaft - 7.5 percent and the German government - 5 percent).

Periodic flooding has deposited sediment loads that are contaminated with heavy metals onto the river banks, making them unsuitable for farming. OTML officials admit that Ok Tedi River water is too polluted for consumption and are trying to provide alternative water supplies. Even worse, OTML has twice spilled large quantities of sodium cyanide into the water.

The government has discouraged opposition to the project. For example, when the Wau Ecology Institute, a local environmental group, brought a case against Ok Tedi to the Amsterdam-based International Water Tribunal earlier this year, the PNG government responded by denying research visas to visiting scientists. Foreign Affairs Minister Michael Somare warned Institute Director Harry Sakulas "to stick to research, and immediately desist from any environmental activism."

The International Water Tribunal recommended that OTML study the mine’s long- term social and environmental effects and find a safe way to store and treat the wastes. The Tribunal concluded, "If no such storage or no cost-effective storage is feasible, the jury believes that the externalized costs of the project grossly exceed the benefits and, consequently, the activities of OTML should be phased out."

The Tribunal also concluded that the mine’s foreign shareholders should ensure that OTML meets environmental standards comparable to those in their home countries, as well as those appropriate to the Ok Tedi region.

A German parliamentary delegation has called upon the German Government to sell its 5 percent stake in OTML because of pollution from the mine.

As part owner of the mine, the PNG government has an inherent conflict of interest in policing the operation. The Tribunal recommended that monitoring compliance with environmental regulations be done by a state institution not involved in managing the mine, not, as is currently the case, by the Department of Mines.

The situation in Ok Tedi is volatile. Taking a cue from Bougainville, landowners have staged protests which have closed down the Ok Tedi mine several times. But OTML is increasing its output of copper and silver at the encouragement of the PNG government, which is still struggling to make up for losses at Bougainville.

What now?

As is the case throughout the Third World, the options for economic betterment in PNG through conventional means appear depressingly few. Jean Eapro of the Melanesian Solidarity Group for a Nuclear Free and Independent Pacific says, "My people have no choices. They can choose between the big logging companies - with all their short-term benefits and long-term destruction - or nothing."

But the choices available to PNG citizens are becoming less grim, as the National Alliance of Non-Governmental Organizations begins to have an impact on national policy. Many groups in the alliance are working to raise landowner awareness of environmental threats and promote sustainable development alternatives.

The wokabout somill, a PNG-devised portable sawmill, may hold the key to developing a sustainable logging system in PNG. Manufactured by the PNG-based Village Development Trust, the relatively small wokabout somill - in combination with PNG’s communal land tenure system - makes small-scale, community- based logging feasible, enabling local people to use and profit from local resources while preserving forests’ ongoing viability. And, because the wokabout somill allows operators to mill a tree right where it is cut, it makes unnecessary the construction of the massive roads which are often used to transport raw logs - and which often leads to logging of previously inaccessible areas.

The development of non-timber forest products, farming of insects, traditional crafts and ecologically oriented tourism are other alternatives to traditional development schemes.

"From our perspective," says Lafcadio Cortesi, a PNG campaigner for Greenpeace International in San Francisco, "it is locally based initiatives that will lead to genuine development, rather than the initiatives of transnationals or the pre-determined spin-off opportunities created by resource extractive projects."


The Grass isn’t greener on the other side

THE ENVIRONMENTAL OUTLOOK for Papua New Guinea is good compared to prospects for the western side of New Guinea island, claimed by Indonesia as the province of Irian Jaya.

The Indonesian government has been less responsive to internal and international pressure to address environmental concerns than the PNG government. Its "Go East" policy encourages multinationals to invest in Irian Jaya and other eastern Indonesian islands. To encourage this investment, the government has relaxed environmental requirements. Martha Belcher, who has spent years working in Indonesia with Indonesian and Irianese non-governmental organizations and is currently with the San Francisco- based Rainforest Action Network, says, "Irianese people feel threatened by the ‘Go East’ policy because they suffer from the environmental and social consequences of large-scale development projects without any true economic benefit to their province."

One long-time exploiter of Irian Jaya is Freeport McMoran , a U.S.-based mining company which has operated the Mt. Ertsberg gold, silver and copper mine under a veil of secrecy for 20 years [see Rich Land, Poor People," Multinational Monitor, October 1990 ].

Freeport’s activities have long had a devastating impact on the Amungme, an indigenous group whose traditional hunting ground overlaps with part of the company’s mining complex. In the 1970s, the Amungme sabotaged Freeport’s operations, leading to vicious government retribution. Many Amungme became ill as a result of living in new climates and new poverty after they were resettled away from the area of Tembagapura, the company town.

According to an ex-employee of Freeport, who recently left a high-level position in Irian Jaya and requests anonymity, Freeport continues to abuse and displace local indigenous peoples. The former employee reports that the Amungme continue to settle around Tembagapura, and that Freeport continues to periodically move them north of the bordering mountains.

In 1988, according to the former employee, Freeport moved a nearby lower-Waa village of 1,000 people to the coastal lowlands. In one month alone, 38 people died from malaria. Demonstrating callous disrespect for the indigenous people, Freeport employees made room for town expansion by unearthing and moving about 50 corpses from the lower-Waa cemetery. The same thing happened at upper-Waa, but some indigenous people from that village returned and rebuilt their homes, prompting Freeport’s Government Relations Office to call in security forces. According to witnesses, the forces burned down a hut, killing one man. An Irianese environmental organization recently demanded an investigation of this and other human rights abuses.

Freeport has also seriously damaged the region’s environment. After many years of silence, the corporation recently admitted that its Mt. Ertsberg operations have caused extensive downstream pollution in three rivers. Because the water has been contaminated, Freeport gave 78 drums to families to catch rainwater for drinking. Freeport Environment Manager Bruce March has told people living in the Koperapoke area to stop consuming sago, their staple food, since it too has been contaminated by pollution from the mining operation.

In July 1991, following a 1990 meeting with the company, environmentalists conducted a site visit of Freeport’s operations. With only two days to inspect the site, the visiting team could not undertake an in-depth study of the environmental and social impacts of the corporation’s operations. Environmentalists hoped this visit would be the first step in a long process of monitoring, but Freeport has been unwilling to grant a second, more substantial site visit.

Freeport is now moving on to exploit the largest proven deposit of gold in the world at Mt. Grasberg, where it expects to mine a record 57,000 tons of ore daily. Due to the magnitude of the new operation, Grasberg will likely have an even more severe environmental and social impact than the Ertsberg mine.

The opening of Freeport’s Grasberg mining operation coincides with the launching of a public relations campaign to bolster the company’s international image. In 1990, after 19 years of production, Freeport opened a small environmental department for its Irian Jaya mining operations. The company also hired Ogilvy & Mather , one of the world’s largest public relations firms.

- D.M. & C.M.-D.


Comalco ’s Power Play

by Murray Horton

CHRISTCHURCH, NEW ZEALAND - Fiordland National Park, situated in the mountainous, rain-soaked and uninhabitable southwest corner of New Zealand ’s South Island, is one of the scenic wonders of the world. Milford Sound and the Milford Track are internationally renowned. A close rival for the tourist dollar is the Triple Trip - a boat trip up Lake Manapouri; a bus trip several hundred meters underground to the Manapouri power station; followed by a further bus trip over the Wilmot Pass and a boat trip on the indescribably beautiful Doubtful Sound.

The power station is clearly the oddity here, not least because it is located in a national park. The power plant was paid for by New Zealand taxpayers and built by a multinational workforce. It is an underground powerhouse, with the turbines driven by water that hurtles through a tailrace from Lake Manapouri to Doubtful Sound. Bechtel designed it, and the Utah Mining Company built it. Fourteen men died during its construction.

The power station was built in 1963, and has operated ever since, for a single purpose - to provide electricity, 24 hours a day, 365 days a year, for the Tiwai Point smelter of New Zealand Aluminium Smelters Ltd. (NZAS), located at Bluff, the southernmost tip of the South Island. The smelter is the eighth largest aluminum smelter in the world and the largest single electricity user in New Zealand (using more than Auckland, the largest city). It has also been the subject of bitter controversy ever since it was first proposed.

Sumitomo of Japan holds a 20.6 percent share in NZAS and Comalco owns 79.4 percent of the company. Comalco is majority owned by Conzinc Riotinto Australi a (CRA, itself the world’s sixth largest mining company), which in turn is controlled by Rio Tinto Zinc (RTZ, the huge British mining multinational).

Comalco ships bauxite from Weipa, in Australia’s northernmost Cape York peninsula, to Gladstone (further south, in Queensland), where it is refined to alumina and shipped to Bluff for smelting. The majority is re-exported to Australia for final processing. Finished aluminum is sold to New Zealand at market prices.

There is good reason for the controversy which has surrounded the Manapouri station and the Comalco deal. Although former Works Minister Hugh Watt said upon his retirement in 1974, "The greatest achievement of my career was persuading Comalco to build their smelter in New Zealand," Comalco has created numerous problems for the country which subsidizes its smelting operations. It tried to ruin a lake to build a power station, it fought both National and Labour governments over attempts to raise power prices and now it is trying to buy the power station itself from the state at a steep discount. Structurally, the Comalco arrangement puts New Zealand in the role of low-cost energy exporter, a fact which the government has implicitly noted in rebuffing other mineral smelter proposals. In 1974, for example, the Labour government rejected a proposed nickel smelter, saying: "As energy and labour would have been the only substantial inputs into a product primarily aimed at export markets, the proposal could have, in effect, involved a low-priced energy export."

Manapouri history

In 1960, the Labour government and Comalco signed a contract for the company to build both a smelter and a power station. In return, Comalco received exclusive rights to the waters of both Lake Manapouri and Te Anau for 99 years. The company planned to build dams that would raise both lakes - 84 feet in the case of Manapouri. This raised the specter of the irreparable damage done to lakes by hydro schemes in the Australian state of Tasmania, where Comalco also has a major presence, and gave birth to the Save Manapouri Campaign (SMC), which marked the beginning of the modern New Zealand environmental movement.

SMC argued, as campaign chair Ron McLean succinctly stated at the time, "Raising the lake is not necessary. You get ample power by keeping the lakes as they are." SMC gathered 264,906 signatures - representing approximately 10 percent of New Zealand’s population - on a petition opposing the raising of the lakes; that remains one of the largest public protests in the country’s history. The Labour government came to power in 1972 promising not to raise either lake, and appointed leading environmentalists (including McLean) to a new body, the Guardians of the Lakes.

Comalco never built the power station. With the company complaining that it could not afford to build the power plant, the government agreed in 1963 to build the Manapouri plant itself and to sell electricity from the station to Comalco at bargain- basement prices that have still not been officially revealed. Bill Rosenberg of the Campaign Against Foreign Control of Aotearoa (CAFCA; Aotearoa is the indigenous Maori name for New Zealand) says, "Comalco has long had highly favorable power prices. Its initial agreement with the government, based on Manapouri power, gave it a 99-year agreement for power at a tiny fraction of the price to other users, with no provision for inflation." The original Comalco rate was 13 times less than the rate paid by New Zealand householders and one twentieth the rate charged to other industries and farmers. The government even granted the company the right to take electricity from the national grid at Manapouri prices; Comalco exercised this right in 1974, when a drought caused a severe drop in Lake Manapouri’s level.

Comalco has repeatedly manipulated and interfered with New Zealand politics - and politicians - to preserve its special arrangement with the Manapouri plant. Rosenberg says that, in 1970, Comalco "issued shares to influential New Zealanders at a cheap rate before offering them to the public. These included prominent journalists, politicians, judges and newspaper executives."

Fighting hard against a rate increase of 650 percent proposed in 1977 by the Muldoon (National) government, Comalco contacted its parent companies in Japan, the UK and the United States [Kaiser Aluminum used to be in the smelter consortium] and asked them to persuade the U.S. and UK governments to "take action" against the New Zealand government, according to internal company documents leaked to CAFCA. The documents reveal that Comalco asked its Japanese associates to organize Japanese industrialists to act against New Zealand and directly asked Australian Prime Minister Malcolm Fraser to intervene in the price dispute. Comalco eventually agreed to a 350 percent rate increase, and the government managed to cut the length of the contract from 99 years to 30 years, so that it will now expire in 2007.

In 1986, with the Labour government trying to increase Comalco’s rate from 1.5 cents to 3.5 cents a unit, Comalco attempted to pressure top government officials, including Minister of Energy Bob Tizard, to be more sympathetic toward the company. Comalco also unsuccessfully took the government to court to try to prevent a rate increase from being legislated.

Comalco shifted tactics in the late 1980s, Rosenberg says, after a 1986 public opinion survey showed that people thought "power prices" rather than "aluminum" when they heard Comalco’s name.

In 1989, Comalco launched a lavish self-promotion campaign. Television advertisements called the company "A Power of Good," and used Vivaldi music and images of sparkling Fiordland water to show how Comalco converted water into electricity into aluminum. Working in conjunction with the Department of Conservation and New Zealand’s most prestigious environmental body, the Royal Forest and Bird Protection Society, Comalco donated NZ$1 million earned from recycling cans into a fund for the preservation of the kakapo, one of New Zealand’s most endangered birds. (1 NZ$ is worth between US$.50 and US$.60.)

Kerry McDonald, managing director of Comalco New Zealand Ltd., explains Comalco’s new concern with public relations: "Comalco came to New Zealand as a producer of basic raw materials. It didn’t want to create a high profit. It just wanted to get on with the business of making aluminum. With the benefit of hindsight, that wasn’t totally appropriate. Clearly, there are a lot of questions about power pricing and the rate of return to New Zealand. So in recent years we’ve tried to establish a higher profile for the company, more recognition of the name Comalco and to build on it by providing more factual information on the business, benefits to the company and New Zealand, on the grounds that it is an important quid pro quo for being the largest electricity consumer in New Zealand."

Essentially, the advertising campaign failed. Comalco has such a bad track record in New Zealand that people were instantly suspicious, and realized that the company wanted something. The campaign focused unwanted public attention on Comalco, and specifically on its attempts to take advantage of the New Right revolution carried out in New Zealand under the 1984-1990 Labour government.

Private vs. public power

The Labour government’s new economic program, commonly called Rogernomics, after Sir Roger Douglas, its architect, called for the corporatization of government agencies. Former government departments became profit-oriented State Owned Enterprises (SOEs), governed by boards of directors. The Electricity Department became Electricorp, headed by New Right ideologues and millionaire businessmen. Comalco’s negotiating partner had changed drastically.

The National government at least had some success in increasing the power price in the 1970s; Labour failed completely in the 1980s. Comalco dragged out negotiations, took court action and complained publicly about its power price. But the company was hardly suffering under the new arrangement, as Electricorp CEO Rod Deane revealed in leaked 1987 documents: "With corporatization, electricity consumers will now have to meet the full cost of running the electricity system. Under the existing agreements, without any explicit Government subsidy, all other electricity consumers will be subsidizing the smelter. Comalco is benefiting by [NZ]$1-1.5 million per week as a result of the present agreements." But the Rogernauts running Electricorp had no stomach to legislate a price increase (which would signal a return to discredited Muldoonism), and the negotiations disappeared into the realm of "commercial confidentiality," where they remain.

Further insights into Comalco’s privileged financial position have been unearthed by the research of Geoff Bertram, an economist at Wellington’s Victoria University. Betram analyzed tax payments made by the smelter, revealing that between 1971 and 1987, the company frequently paid nothing, and on average paid only NZ$1.6 million per year. It only started paying New Zealand’s standard corporate rate in 1988.

Labour’s real agenda for the Manapouri power plant became evident in 1986. The Labour government and its ideologues saw corporatization (the creation of SOEs) as only the first step toward privatization. It wanted to sell the Manapouri power station, and Comalco was the obvious buyer.

Buying the Manapouri plant is a viable option for Comalco. Its current contract expires in 2007; it wants security of supply, and it is talking of building a fourth potline (a facility at which alumina is smelted into pure aluminum). As Bertram points out, "There are only two ways for Comalco to lock in half-price electricity for the next half century. One is to buy the power station at half its value and integrate it into the smelter consortium, so that the electricity price is merely an intra-company transfer price, and not an arms-length market transaction. The other winning strategy for Comalco would be to trap the New Zealand government into another long-term supply contract, written by the company’s lawyers and full of small print, which adds up to a replay of the history of the last 30 years."

Outside analysts, such as Bertram, estimate the plant’s value as at least NZ$3 billion. But the parsimonious multinational only offered a few hundred million dollars for Manapouri. The only issue for the Labour government was negotiating the price for the power station - and the government has sold other public assets, including the national phone system, to multinationals at scandalously low prices - but it did not get the chance to hammer out a deal.

Labour crashed to New Zealand’s biggest electoral defeat in 1990, but the Bolger (National) government continued Rogernomics unabated. Today, however, there are signs that, influenced by 1993 election pragmatism, the government may be rethinking its policies. As Leader of the Opposition, Jim Bolger had stated that Comalco was entitled to get its power price issue settled, and had promised to study the issue of selling Manapouri to Comalco.

In 1991, the Save Manapouri Campaign was revived, with many of the same leaders in place, albeit 20 years older. Called Power For Our Future, it spent NZ$53,000 from the leaders’ own pockets, bombarded the government with position papers and conducted public meetings throughout the country. Unlike the Labour Party, it was opposed to the whole principle of selling Manapouri to Comalco (or anybody else), not simply the price. The Campaign opposed selling off the power station to ensure that Comalco did not rehabilitate its plans to raise Lake Manapouri’s waters and voiced the compelling economic argument for keeping a massive 4000 gigawatt-hour power station in public (or semi-public) ownership.

The Campaign was successful. In 1991, Bolger announced that Manapouri would not be sold to Comalco. In the "meantime," he said, Electricorp would resume negotiations with Comalco. The issue of Manapouri being sold is now on hold at least until after the 1993 election.

Power For Our Future was even paid the backhanded compliment of a politically motivated break-in, which targeted its membership lists, financial details and minutes. Sir Randal Elliott, one of New Zealand's most famous physicians and a leader of Power For Our Future, described it as "a Watergate-type exercise, clearly meant to destablize and irritate the group." There is no clue as to who was responsible. The Campaign has gone on to focus on the government’s plans to privatize the nation’s electricity network.

Comalco keeps going and going ...

Comalco has not given up its aspirations to retain access to Manapouri power at discount rates. Now it is employing the tried-and-true multinational strategem of pitting regions and countries against each other. In March 1992, the Comalco board of directors met at Tiwai for the first time since 1984, told the anxious local media that it could only afford to upgrade one smelter at a time and announced that it would make its decision on which smelter to upgrade within the next six months. Chief Executive Nick Stump suggested several possible options: construction of the fourth Tiwai potline (with extra power needed from Electricorp); privatization of the Gladstone power station and expansion of the Boyne Island smelter in Queensland, Australia, following negotiations with the State government; or replacement of the Bell Bay potlines in Tasmania. "They are all [NZ]$500 million plus projects. The question is who is going to be first cab off the rank," Stump said. And he introduced a wild card - a pre-feasibility study on a new smelter in Chile.

The pressure tactics have worked, at least at the local level. Invercargill, the major city closest to Tiwai, has benefited handsomely from Comalco money and smelter jobs. The local National MP urged Bolger to step in to assure that the smelter expansion would take place in Bluff, and not in Chile or elsewhere. But Bolger, a Cabinet Minister in the Muldoon government, has dealt with Comalco before, and said the negotiations will be left to Electricorp, with no government intervention.

Bertram believes Comalco should stay, but that the government should call the company’s bluff by charging it the real commercial rate for electricity. "The early phase of the resource multinational is predatory, because otherwise it wouldn’t come. About 10 years on, they enter a more mature phase, and evaluate whether they’re in for the long haul, or phase out. Comalco is in that phase now." A beautiful lake, and a nation’s peace of mind, depend on whether Comalco is willing to accept the responsibilities of corporate maturity.


Crushing Labor in New Zealand

by Robert Reid

PALMERSTON NORTH, NEW ZEALAND - "The Employment Contracts Act gives the employers the power to do basically whatever they want. To me, the biggest aim of it is to break unions," says Andrea Rushton, one of the shop stewards for more than 80 workers at Christchurch Carpet Yarns who were locked out of their jobs for more than two months earlier this year. The company shut its doors to the textile workers in late February after they rejected a company-designed contract that eliminated many of the gains their union had helped them win in previous negotiations.

The locked-out workers and their supporters picketed the plant throughout the lockout. Rushton was one of 13 picketers who were arrested for their actions.

"I got arrested trying to defend my livelihood," she says. "The police say we were blocking the carriageway. When they asked us in the cells what our ‘excuse’ was, we all explained that we were defending our jobs. I don’t see anything wrong in trying to stop your livelihood, your job, being driven out a driveway."

Rushton and her co-workers are victims of the Employment Contracts Act, which was enacted by the New Zealand government last year. With its implementation on May 15, 1991, the Act ended a system of industrial relations in New Zealand that dated back to the passage of the Industrial Conciliation and Arbitration Act (I, C and A Act) in 1894.

In introducing the bill into Parliament on December 19, 1990, Minister of Labour Bill Birch stated that the new legislation was intended to "place the responsibility for negotiation where it belongs, with the employer and their employees." The government explicitly sought to eliminate unions’ role in labor-management negotiations. The previous "legal framework that required the intervention of unions as a third party in any recognized industrial bargaining relationship ... will be removed," Birch said. "Employers and employees will be free to negotiate any bargaining arrangements they wish. The parties themselves will decide whether they wish to bargain at the enterprise, industry, workplace or any other level."

Critics say the the Act has enabled the New Zealand government to accomplish what many governments have tried to do through repression: eliminate union influence in wage setting and unleash virtually unfettered market forces in the labor market.

"The so-called freedom given in this Act is simply the freedom to be exploited," says Graeme Clarke, secretary of the Manufacturing and Construction Workers Union. "The much-vaunted freedom of association enshrined in the Act is in fact a freedom for the employers to disassociate their workforce and to bypass the democratically elected representatives of their workers, who are, or should be, their union."

On the road to labor’s demise

The new labor act is especially remarkable because the previous system of industrial relations in New Zealand was one of the most regulated in the capitalist world. The I, C and A Act and its successors sought to provide a mechanism through which conflicts between labor and capital could be resolved peacefully.

Except for a brief period in the 1930s, the principles of the I, C and A Act governed labor relations throughout the twentieth century, until the passage of the Labour Relations Act (LRA) in 1987. The cornerstone of the old system was occupational "awards," negotiated between unions of workers and unions of employers, that applied to workers and employers throughout the country. The law required all employers to abide by the minimum wages and conditions contained in an award and all workers to belong to and contribute to the union that negotiated the wages and conditions (known as compulsory unionism). All awards had to be registered by an Arbitration Court; if the parties could not reach a negotiated agreement, the Arbitration Court held hearings on the dispute and issued a binding decision.

A significant feature of the I, C and A system was that it worked to slow the rise of wages during periods of high demand for labor but to prevent or slow the fall of wages during periods of low demand.

From the late 1960s to the early 1980s, the system came under pressure from both workers and employers. In 1968, workers struck over a nil wage order decision issued by the Arbitration Court, and eventually had the decision reversed. During the economic slump of the early 1980s, employers persuaded the Government to remove the compulsory union membership provision of awards.

Elected in a landslide victory in 1984 that threw the National Government of Prime Minister Robert Muldoon out of office, the Labour Party quickly renounced its traditional pro-worker program. Instead, the new government unleashed at breathtaking speed a market-based economic revolution centered around deregulation.

"Labour was elected in 1984 on the basis of reintroducing compulsory unionism," says Clarke. "Labour kept this promise, but then used it to either gain [union] support of, or to neutralize union opposition to, all the other policies of deregulation that it was pursuing."

Under the new program, orchestrated by Finance Minister Roger Douglas, the government devalued and then floated the NZ dollar. The government stripped away regulations first from the finance sector and then from many other areas. It reduced income tax rates and imposed an indirect tax. It corporatized government trading departments (on the grounds that corporatization - administering government entities as if they were private corporations and forcing them to earn a profit - would strengthen the public sector), and then sold them (the government argued that it was selling assets, not as part of a privatization scheme, but to gain cash for social programs). And it withdrew subsidies from farming and manufacturing.

The productive sector went into crisis, but the stock market, spurred by speculative investment, boomed - until the 1987 crash.

At this stage, the Labour Government lost its nerve. Prime Minister David Lange called for "a cup of tea" and forced Douglas to resign by vetoing his next round of reforms. This rest period infuriated reform zealots who then blamed New Zealand’s poor economic performance on the Labour Government’s reluctance to tackle labor market deregulation and to cut government social spending.

But the Labour government did make some significant reforms in the labor- relations field. In 1987, Labour introduced the Labour Relations Act, which Clarke says "took the first steps at dismantling the old I, C and A system." In 1990, after more employer pressure, the government amended the Labour Relations Act to allow employers to opt out of national awards. Among other provisions, the Act eliminated compulsory arbitration for the settlement of awards. The Employers Federation and Business Round Table, an extremely influential lobby group of top business executives, condemned the legislation for not going far enough.

Where was the labor movement?

The New Zealand Council of Trade Unions (NZCTU) proved reluctant to fight the Labour government’s efforts to weaken the traditional system of labor relations. The NZCTU supported the removal of compulsory arbitration for the settlement of awards on the grounds that, in return, it gained the legal right to strike for a new award. (However, while it is true that unions did not previously have this legal right, many did it anyway.) The NZCTU also supported the 1990 amendments to the LRA, on the basis that these concessions would satisfy employers and stop them from asking for more.

That supposition proved incorrect. On December 19, 1991, the newly elected National Government announced the introduction of the Employment Contracts Bill as part of the Economic and Social Initiative Statement. The Statement also called for up to 25 percent cuts in social welfare benefits and reviews of all other education, health, housing and social expenditures.

While community, church, unemployed and social service groups immediately organized protests around the proposed benefit cuts, it took months for the trade union movement to organize opposition to the Bill. Three months after the legislation was introduced, worker opposition finally spilled on to the streets. As the Bill was considered by a Parliamentary Select Committee, workers held major rallies and tens of thousands of workers walked off the job.

The NZCTU coordinated these actions, but it refused to back workers calling for a general strike to protest the bill. "Just as the leadership of the NZCTU had refused to organize opposition to the deregulation of the labour market under the Labour Government, it effectively sabotaged worker opposition to the Employment Contracts Bill by rejecting the call from stopwork meetings of workers up and down the country for a general strike in opposition to the Bill," says Clarke. He adds that the emphasis on what was called "pragmatism" led to divisions within individual unions. "NZTCU President Ken Douglas launched a crusade against the calls for a general strike. The leadership of some unions even campaigned against their members opposing the Bill, saying they should instead call for the Bill to be amended."

Clarke believes that this "new realism" of the NZCTU leadership "allowed the Employment Contracts Act to be passed with trade union opposition blunted and many workers feeling let down with the lack of response from their union leadership."

Draconian measures

With the Employment Contracts Act’s passage, union members found themselves confronted with the following anti-worker provisions:

o All legal recognition of unions has been eliminated. The word "union" does not appear in the main body of the Act. Existing unions were transformed into Incorporated Societies. Compulsory union membership of any sort - even closed shops (in which all employees at a worksite become union members if a majority decide to do so) - is outlawed.

o Employers and workers may negotiate either individual or collective employment contracts. However, the Act effectively gives the employer the power to dictate whether a collective or individual contract will exist.

o Although collective employment contracts are allowed, negotiations are left entirely to the businesses and employees, with no provision made for outside guidance or intervention.

o Employment contracts apply only to the workers designated in the contract. New workers have no right to join a contract that applies to the rest of a workforce.

o When collective employment contracts expire, conditions within them convert into individual employment contracts for workers under the old contract, until new collective or individual contracts are negotiated.

o Individual workers can negotiate their own terms of employment or can appoint an agent to represent them. An agent can be a lawyer, a union or even a friend. There is no restriction on the number of agents or negotiators in each company. Employers, however, are not required to negotiate or conclude a contract with the nominated agent of a worker.

o Strikes and lockouts are illegal during the term of a collective contract, and are only permitted when workers are seeking a new collective contract. It is illegal to strike to pursue a multi-employer collective contract.

o Personal grievances and disputes over interpretation of a contract can be referred to a system of employment tribunals and courts. Strike action over these matters is illegal.

The provisions of the Employment Contracts Act should be seen in the context of other moves the government made at the same time. It repealed pay-equity legislation; cut unemployment and related benefits by up to 25 percent; imposed a 26-week-stand-down period for unemployment benefit eligibility for workers who were dismissed from previous employment, left previous employment without a sufficient reason or refused to take an offered position regardless of its salary or conditions; and refused to extend minimum wage provisions to those under 20. The adult minimum wage is US$3.30 per hour, but, with the wage floor set by the award system gone, it is now legal to pay young workers any rate an employer may decide.

Labor’s worst fears about the effects of the Act were immediately borne out. John Ryall, an organizer with the Service Workers Union, says, "We thought the Act was bad enough, but the immediate advantage that some employers have taken with the Act and the results of some initial Employment Court rulings have made matters even worse."

For example, he says, "Because of the lack of a minimum wage for workers under 20, we now have numerous cases such as the one of an 18-year-old hamburger-restaurant worker in Wellington who was being paid US$70 for a 70-hour week. Under the previous award she would have received US$180."

Ryall also points to a landmark decision of the Employment Court regarding workers from the Society for the Intellectually Handicapped (IHC), an agency caring for the intellectually handicapped. The IHC unilaterally cut wages and worsened working conditions when its employees’ union would not agree to these concessions through negotiation. The union took the agency to the Employment Court, which accepted the employer’s argument that its actions were legal under the Act. "This decision makes a complete lie of the Government propaganda before the Act was passed which stated that no employer could unilaterally vary the terms of an employment contract," says Ryall.

Strengthened by the Employment Contracts Act, the employers’ offensive against workers is accelerating. Employers threaten or implement lockouts almost every day. Textile workers at the Alliance Mill in Milton have been locked out since January 13 for refusing to sign a contract. Mitsubishi locked out 500 auto workers for one day in January. Now government enterprises are using these weapons to try to eliminate such things as unemployment provisions from their contracts.

"Union busting has become a growth industry," says Ryall. "A new breed of consultants is advising employers how to implement contracts by ignoring the union and going straight to the workforce to sign the contracts." The courts have ruled that these tactics are legal even in cases where the workers have signed bargaining authority over to the union and where there is proof that workers were pressured to sign a contract with the employer. And, although the Act prohibits employers from exerting "undue influence" over employees in contract negotiations, the Employment Court ruled in the Alliance Mill case that an indefinite lockout does not constitute undue influence.

Savaging unions

Government officials and employers are generally pleased with what the Act has accomplished in the year since its passage. Labour Minister Birch points to the reduction of industrial stoppages over the past year as proof that the "Act has brought employers and employees closer together."

Employers Federation Director General Steve Marshall praises the philosophy of the Act, but calls for a number of "technical changes" to make it more fair to employers.

The Business Round Table says the Act has not gone far enough and has called for the removal of all specialized Employment Courts and Tribunals and an end to the minimum wage provisions.

The Act has decimated the labor movement. A number of unions have disaffiliated from the NZTCU, criticizing its unwillingness to vigorously challenge the Act. The NZTCU itself has embarked on a campaign for union restructuring along industrial lines rather than occupational lines. By its own admission, this campaign has been unsuccessful, as have attempts by the NZTCU to prevent "body snatching" among its own affiliates.

Almost all private-sector unions have suffered severe losses of membership, up to 50 percent in a number of cases. Some major unions have disappeared, including the New Zealand Clerical Workers Union, which suffered large membership loss and became the sacrificial lamb in an NZTCU-sponsored carve-up to augment the membership of other unions. This exercise de-unionized workers more quickly than if the union had been allowed to remain in existence.

Other unions have attempted to "live with the Act" and restructured themselves into Limited Liability Companies acting as bargaining agents for both members and non- members. Still others are holding on, hoping for a Labour Party electoral victory in 1993.

"Overall, the union movement has been savaged by this Act," says Clarke. "There is a strong trend to ‘yellow’ or pro-company unionism by the unions that are trying to survive at any price. On the other hand, some of the smaller, independent unions such as ours are being joined by other unions or sections of unions that are not into concessionary bargaining and that are prepared to fight both industrially and politically against this anti- worker piece of legislation."

The workers at Christchurch Carpet Yarns did just that. Although they had to accept many contractual provisions that they had opposed, they succeeded in forcing the company to sign a contract that included union recognition and representation. Says shop steward Darryl Payne, "We have won our contract - a union contract. We didn't get everything we thought we were entitled to, but we remain determined and united. We remain union and the company has to recognize that."


The Politics of Race and Pollution

An interview with Robert Bullard

Robert D. Bullard is a professor of sociology at the University of California, Riverside. He has worked on and conducted research in the areas of urban land use, housing, community development, industrial facility siting and environmental equity for more than a decade. He is the author of dozens of articles and monographs and four books, including, most recently, Dumping in Dixie: Race, Class and Environmental Quality ( Westview Press, 1990). He is part of an ad hoc group of social scientists, known as the Michigan Group, which has pressed the U.S. Environmental Protection Agency to address issues of environmental equity.

Multinational Monitor: Do people of color in the United States have a different set of environmental problems, concerns and priorities than whites in the country?

Robert Bullard: I think people of color probably do, for the simple reason that the problem of environmental degradation hits communities of color at all class levels much harder than white communities of comparable social and economic status. This is true whether we talk about problems ranging from lead poisoning to toxic waste siting to garbage incineration to pesticides poisoning farmworkers. The problems are more pressing and the call for action is more dramatic because it is a life-and-death situation.

MM: What do you mean when you use the term environmental racism?

Bullard: Environmental racism is an extension of the institutional racism which touches every aspect of our society, including housing, education, employment and law- enforcement. And institutional racism is defined as those laws, customs and practices which systematically reflect and produce racial inequality in American society, whether by intent or happenstance.

Environmental racism also means excluding people of color from boards and decision-making commissions - bodies such as city councils, industrial commissions and boards of supervisors. Often times this means that unwanted land uses or polluting industry will be directed away from those policymakers’ communities and constituencies and toward those persons who don’t have the power to make siting decisions because they’re not on those boards.

MM: How does environmental racism work in practice?

Bullard: Companies, whether by design or default, [target] communities that don’t have the resources and infrastructure to fend off unwanted facilities - whether it be a Native American reservation or whether it be a rural poverty pocket in the black belt in Alabama.

Low-income minority communities are the most vulnerable for siting of landfills, incinerators, toxic waste dumps, lead smelters, you name it. And that is an extension of the fact that these are the same communities that are least likely to have adequate fire protection, housing code enforcement, health care delivery, street lighting and sewer hookups. You start naming municipal facilities, and you see that there is a direct correlation between lack of residential amenities and the location of these types of facilities.

MM: Could you discuss some of the evidence that you and your colleagues have accumulated about disproportionate siting of pollution-intensive facilities and dump- sites in people of color communities?

Bullard: I want to make it clear that environmental racism doesn’t just deal with siting of facilities - it’s bigger than that.

I conducted one of the earliest studies that was done looking at disproportionate impact and differential siting - in Houston, Texas, beginning in 1978.

From the early 1920s up until 1978, the city of Houston had used basically two forms of waste disposal - landfilling and incineration. We documented that five out of five of the city-owned municipal landfills were located in predominantly black neighborhoods; six out of eight of the city’s garbage incinerators were located in predominantly black neighborhoods. African-Americans only made up 28 percent of the city’s population during that period of time.

When the city stopped disposing of its waste at its own facilities and turned it over to private industry, we documented that three out of four of the privately owned facilities, landfills, were located in predominantly black neighborhoods.

These were decisions that were made by public officials and by private industry. We were able to document that it was not just low-income black communities being targeted - low-income, moderate-income and middle-income black communities were all the subject of siting discrepancies.

This was 1979. It was not until 1983 that the General Accounting Office actually did a similar study, which looked at off-site commercial hazardous waste landfills in EPA’s region 4 (which consists of the southern states). The 1983 GAO study documented that three out of the four offsite hazardous waste commercial landfills in region 4 were located in primarily black communities. Blacks, however, only made up about one fifth of that region’s population, about 20 percent of the region’s population - so that’s a discrepancy.

You start seeing all these studies accumulate. There are numerous studies - the [1987] United Church of Christ Commission of Racial Justice Study is another study that has systematically documented that people in African-American communities and Latino communities are most likely to live around hazardous waste facilities and that race is the most potent predictor of who lives around these sites. Not class, not education, not prices of land, not owners vs. renters, it’s race. So institutional racism, as I said before, cuts across class lines.

In 1990, I wrote a book called Dumping in Dixie. I looked at five communities in the South. Houston was one, with its landfills and municipal garbage facilities. In Dallas, Texas, all of the lead smelters in the history of the city have been located in African-American or Latino communities. In Louisiana’s Cancer Alley, that stretch from Baton Rouge to New Orleans, I looked at a community called Alsen. Hazardous waste incinerators located within that area were all within a predominantly black community, not a low-income community but basically a low-to-moderate-income community of homeowners. The study also looked at Emelle, Alabama, where the nation’s largest hazardous waste facility is located in a predominantly black county. Emelle is about 95 percent black and in the heart of the black belt - those predominantly black counties that stretch across Alabama, Louisiana, Mississippi. I also looked at the problem of the chemical emissions in Institute, West Virginia, a predominantly black town in West Virginia that is a suburb of Charleston. I started to look at a pattern of how these facilities were operated in the heart of these communities without there having been any input from the local residents. Decisions were made by industrial commissions and by city councils to provide incentives for these companies to operate [in people of color communities], with very few jobs going to local residents.

MM: Do companies or cities, whichever is directing siting, attempt to buy off the communities that are going to be affected with promises of jobs?

Bullard: The whole notion of environmental blackmail is real. In many cases, you’ll find that communities that are being targeted have high unemployment rates. People want to work, and local elected officials often sign on to the notion that these companies can provide jobs and an expanded tax base and can become a good neighbor. The promise of jobs is a very potent kind of carrot to dangle in front of people when they are unemployed, poor and don’t have any income.

However, garbage incineration, for example, is not a labor-intensive industry. We’re talking very few jobs and we’re talking the kind of jobs that would not be matched with the skills of local residents.

So what has happened is that more and more communities have started to look beyond the promise to what the bottom line is - how many jobs will actually go into the community and how many jobs will the residents actually get.

MM: Is there an upsurge of opposition to these kind of facilities in people of color communities?

Bullard: There is an upsurge because there is an intensification of the targeting. However, the resistance has been there all along. Because of the more stringent environmental regulations, because of the difficulties involved in siting, more and more communities of color are being targeted. So you find more and more opposition organizations springing up all over the country, whether it is in Latino communities in California, on Native American reservations, in rural poverty pockets in the black belt or in urban areas in Los Angeles, Dallas, Houston, New York City.

The activity has been intensified and all kinds of groups and networks are forming so that people can start to share their ideas and strategies about how to combat these things. In the southwest, for example, the Southwest Organizing Project and the Southwest Network for Environmental and Economic Justice cover eight states. The Gulf Coast Tenants’ Associations covers Alabama, Louisiana and Mississippi.

We have seen some maturation of people of color organizations and groups to address the dumping issue and the toxics issue, but also to start forming alliances to begin to address other environmental issues like farmworker issues and pesticides, or issues of lead in inner city areas. Organizations have become more sophisticated with the passage of time.

MM: Are there any successful campaigns that you can point to?

Bullard: We’ve documented a lot of success stories and put together a directory of people of color environmental groups that includes more than 200 organizations all over the country that have been successful at some level in fending off the onslaught of environmental racism.

For example, the Concerned Citizens of South Central L.A. successfully fought off a city proposal to locate a municipal solid waste incinerator in their community. The Good Road Coalition on the Rosebud reservation in South Dakota was successful last year in beating off a proposal from a Connecticut-based company to locate a 6,000 acre landfill on the reservation - a grassroots group of Sioux had an election that recalled some of the tribal council and defeated the proposal. During the same year, another Native American group in Philadelphia, Mississippi, Concerned Citizens of Choctaw, beat back a plan again to locate a toxic waste landfill on that particular reservation.

In Dumping in Dixie, I documented how local residents in a predominantly black neighborhood in West Dallas were able to close a lead smelter that had been operating for 50 years. As it turns out, the lead smelter had been operating in total violation of a local land use ordinance. And the city had known this for many years, but [had failed to take action because] the facility provided jobs. Because of the harm that had been done to local children in that area, a class action lawsuit was filed and was settled in 1984 for more than $20 million. That is one of the largest lead settlements in this country.

We’ve documented another case that goes back to the late 1970s, involving a community in North Alabama called Triana. This community was dubbed in National Wildlife magazine as the unhealthiest town in America. The Centers for Disease Control documented that this town’s residents were contaminated with the highest level of DDT ever recorded. Olin Chemical Company manufactured the DDT for Redstone Arsenal, which is an army base in North Alabama. Once DDT was banned, the company closed the plant and buried drums of the chemical in the ground. The DDT residue leaked into a tributary of the Tennessee River. People had been eating the fish from the river for years, and they were contaminated. A lawsuit was filed and settled for something like $26 million.

There have been a number of Love Canals and Times Beaches all over this country and in communities of color. They just have not received the coverage and media attention that a Love Canal or Times Beach has gotten. However, people have been resisting and they have been winning. The idea that communities of color are not concerned and that they are not active is a myth. That myth is being dispelled every day as we find groups from West Harlem to East L.A. becoming very active in the grassroots environmental justice movement. We don’t find a large number of people of color in the mainstream organizations. Their activity is concentrated at the local, grassroots level, where most of the problems are concentrated.

MM: Could you speak about the specific sort of problems that Native American groups are facing?

Bullard: Native Americans are facing some of the worst environmental problems of any particular group. Reservations were one of the areas that the federal government forgot about. Because of the quasi-sovereign status of Indian nations, they are not covered by state or, for the most part, federal environmental regulations. So we find, in many cases, polluting industries on the reservations. For example, the Navajo lands that were used to mine for uranium are some of the most polluted areas - the tailings create tremendous health problems for children who play on them, for the families who live around them and for the workers themselves.

Reservations are being targeted for incinerators, toxic waste dumps and even nuclear waste storage facilities. We’ve documented more than four dozen reservations that have been approached by polluting industries to locate there, to get around the more rigorous state regulations.

And the Department of the Interior and the Bureau of Indian Affairs’ position is to promote more polluting industries on these lands as a form of economic development.

Then you look at the added problem of health care, infant mortality and disease and alcoholism and life expectancy - Native Americans have one of the lowest life expectancy rates of any ethnic group in this country. You’re talking about locating these facilities that are health threatening in an already impoverished, unhealthy environment.

For Native people, their land and their religion is one. I think that you can see how when Native people talk about environmental and toxic genocide, they see it as not only racism but as a form of cultural and religious genocide. It’s a very important piece in our definition of what people of color see as environment.

We define environment as everything: where people live, where people work, where people play. Some people see the environment as something to be exploited; other people see it as something to be preserved and conserved for generations to come. That is where the conflict comes in and that is where various groups across the country, whether they be African-Americans in urban areas or Latinos or Asian-Americans, are converging in total solidarity with native peoples in this country and indigenous people around the world.

MM: How has the Environmental Protection Agency (EPA) responded to concerns about environmental racism that you and your colleagues have brought before the agency?

Bullard: The Environmental Protection Agency doesn’t want to own up to the fact that institutional racism exists in this society, including environmental racism.

In the EPA’s Environmental Equity report, there is not even a mention of racism, and the fact that racism could be operating to disenfranchise people of color communities. The report leaves out a substantial body of literature on environmental disparities as related to race and class. It glosses over the problem of pesticides and farmworkers and how the Agency has systematically neglected this area - from 1979 up until this day, we have not gotten farmworker protection regulation. For EPA to say that we don’t have enough data and enough studies and that’s why we cannot act is disingenuous. We do have the data on lead: the federal government has systematically documented that at every class level, African-American children are more likely to be poisoned by lead. Sixty-eight percent of black children who come from families making $6,000 or less are poisoned, versus 36 percent of white children who come from comparable income levels. Of African- American families with incomes of $15,000 or more, 38 percent are poisoned, versus 12 percent of whites who come from families with comparable incomes. So the federal government has documented that a middle-class African-American family is more likely to be poisoned than a lower-income white family.

We asked "why?" And there is a racial component, and that racial component is that African-Americans are residentially segregated at every income level. The housing that middle-income African Americans can acquire is often times of lower quality and more likely to be in areas where houses have lead-contaminated paint.

The problem that the EPA does not want to address is that racism is real, and the agency thinks it can somehow deal with the inequities and deal with the disparities without calling it racism.

MM: Are there are specific demands you’ve made of EPA?

Bullard: We would like to see the EPA begin addressing the problem of the inequitable and differential enforcement of regulations that are already on the books. There is a disparity in how EPA addresses clean-up and relocation in Superfund sites, for example. We want to see one set of rules, to have all communities treated the same.

For example, an African-American community of homeowners in Texarkana, Texas is sitting, right now, on top of a Superfund site. Congress has passed legislation for a relocation: $4 or 5 million has been set aside to relocate Texarkanans. And EPA has dragged its feet for two or three years. We say treat Texarkana the same as Times Beach was treated - with deliberate speed. Give people fair market value for their houses; right now, the EPA has turned over the appraisal to the Army Corps of Engineers, which is trying to purchase the houses from the local residents. People cannot buy houses and move to other communities when they are being promised [unfairly low] prices for their houses.

I think people are saying we should have one set of rules when it comes to relocation of people of color and when it comes to relocation of white people. Environmental equity does not call for putting landfills or incinerators in white communities, and poisoning white children at the same rate as people of color. That’s not what we’re talking about. We want to see fairness implemented in all of the rulemaking and implementation of all the environmental protection regulations. We want to see pollution prevention take the front seat.

So we want to see some changes made within the EPA. It’s beginning to make some changes, but it’s very slow. The EPA has agreed to set up an office of environmental equity, but we want to see some teeth put in that, we want to see some funding put into that. We want to make sure that it’s not just a window-dressing office, that it is not an office that is set up just to tell people of color, "no." We want to see rigorous enforcement, we want to see rigorous use of EPA’s permitting powers to make sure that states and local governments in conjunction with private disposal companies don’t continue siting facilities in people of color and low-income communities.

The EPA should look at all of the land use in a particular area and begin to address not just risk analysis associated with the permiting facility, but also what’s already in there. If a community has a landfill, if it has an incinerator, if it has a lead smelter - then this is not an appropriate area for locating another facility. We want to see cumulative and synergistic analysis done to take into account the total impact.

These are the kinds of things that we’ve been exploring with the Agency. I think the fact that we are talking is progress. But we’re not satisfied with promises. We want to see something actually put in place and institutionalized.

MM: What are some of the linkages that U.S. people of color groups are making with Third World organizations and the major common issues they are trying to tackle?

Bullard: The same problems that exist for people in our communities here are now being exported abroad. We have poisoned people of color communities here and now we are getting ready to poison people of color communities around the world. That is environmental racism.

There are a number of areas of common concern. One is the export of toxics and polluting industries. There has to be some kind of mechanism to address the waste that is created within our borders. Shipping it abroad is no solution, as shipping it to people of color communities is no solution. Pesticides are another example: pesticides that are banned in this country are being manufactured abroad. That has to be addressed. Another example is the problems of the maquiladoras, the twin plants along the U.S.- Mexico border - the same companies that are operating in this country are moving across the border and setting up shop and following different health and environmental standards than they are in this country.

We’re beginning to see links made between grassroots groups in this country and grassroots groups in other countries around the world. I think that’s where the important meetings are going to occur at the Rio Earth Summit - between grassroots groups of this country and the Third World - not the government-to-government meetings, because the deal has already been cut in terms of the environment and the economic and the development part.

MM: Could you elaborate on connections that are developing between grassroots groups here and abroad?

Bullard: There are a number of study groups that have been going back and forth. One example is groups that have been working with groups in South Africa - making tours to the townships and working with groups to talk about environmental problems and how to integrate the environment into an economic social justice movement. We have a lot of things in common. When you talk about polluting industries locating next to homelands or next to townships or next to the ghetto, it’s the same.

Similarly, farmworkers, for example, in their organizing strategy, are now linking up with farmworkers in other parts of the world and addressing the issue of pesticides and work conditions.

Also, grassroots women’s groups, which are often leaders of local environmental movements, are linking up with women’s groups in other countries.

In many cases, Third World groups are looking to people of color organizations and organizing in this country as models they can learn from. The Southwest Organizing Project in Albuquerque, for example, has made a number of trips to Costa Rica and other Latin American countries to work with groups on land reform and organizing people around environmental, economic and social justice issues - not just separating out the environment as one piece, and economics or job development as another piece, and justice over here as another piece.


Plastics: Trashing the Third World

by Anne Leonard

JAKARTA, INDONESIA - In the 90 degree heat, women stand over huge piles of plastic garbage. It is too hot to wear a protective smock - not that one is available anyway. They use the same bare hands to wipe the sweat from their brows that they use to sort the thousands and thousands of old plastic bags.

Even though the women are working in a crowded slum outside Indonesia’s largest city, much of the writing on the plastic garbage is in English. The women sort through liquid soap bottles, food wrappers, disposable diaper packages and huge bags with familiar logos - Dow , Du Pont , Monsanto , Solvay , BASF , Mobil . A white powder blows out of some of these bags as the women pull them from the pile. The women sorting the bags cannot read English, so they do not know that the white powder is titanium dioxide, which causes respiratory damage. They do know, however, that when the Indonesian plastics recycling companies they work for began importing plastic waste from the United States, they developed skin rashes they never had when they only processed locally produced plastic waste.

The health risks faced by the Indonesian women - and thousands like them throughout Asia and elsewhere in the Third World - are a direct result of the upsurge in plastic use in the United States - and of industry efforts to quell public concern in the United States about the environmental effects of increased plastics use.

Plastic’s new image - biodegradable and recyclable

In 1989, U.S. corporations used more than 12 billion pounds of plastic for packaging designed to be thrown away as soon as the package is opened. In the 1990s, this figure is expected to double.

It was not until recently, when people began to realize that landfilling plastic preserves it forever and burning it releases some of the most toxic substances known to science, that the U.S. public started to question the country’s growing dependence on plastics. Rather than address these serious environmental problems, the plastics industry focused its attention on addressing its public image.

A confidential December 22, 1989 letter from Larry Thomas, president of The Society of the Plastics Industry, invited plastics manufacturers to help develop a $150 million public relations campaign. "The image of plastics among consumers is deteriorating at an alarmingly fast pace. Opinion research experts tell us that it has plummeted so far and so fast, in fact, that we are approaching a ‘point of no return,’" Thomas wrote. "Public opinion polls during the 1980s show that an increasing percentage of the general public believes plastics are harmful to health and the environment. That percentage rose sharply from 56 percent in 1988 to 72 percent in 1989. At this point we will soon reach a point from which it will be impossible to recover our credibility. (Witness what has happened to the nuclear energy industry.)"

The plastics industry developed a two-point plan to restore its image. First, by mixing small amounts of corn starch into plastic products, the industry claimed its plastic packaging, garbage bags and diapers were "biodegradable." It did not take long for the U.S. public to figure out that although corn biodegrades, plastic does not [see The Biodegradable Myth," Multinational Monitor, March 1990 ].

Next, the industry jumped aboard the recycling bandwagon. Instead of "biodegradable," nearly every plastic package on the supermarket shelf is now stamped "recyclable."

"If we can get our act together and show the world just how recyclable these valuable polymers are and that the industry stands behind the commitment to prove it, then the mathematics will change," explained Marty Forman, chair of the Institute of Scrap Recycling Industries’ plastic committee last June. "It won’t be a 60-billion-pound market shrinking to 45 because 15 billion pounds were recycled, it will be an 80 or 90 or 100 billion pound market which has expanded because those plastics are recycled."

Unfortunately, the plastics companies’ claims that their plastic is "recyclable" are badly misleading. Plastic waste is seldom if ever recycled into the same product, so recycling used plastic does not make a dent in the amount of plastic needed to make the original products. Additionally, each time plastic is heated, its chemical composition changes and its quality decreases, so the number of times it can be recycled is very limited. The most dishonest aspect of plastic recycling claims, however, may be that many of the plastic bags and bottles dropped off at local recycling centers in the United States are shipped to Indonesia and other Third World countries, where much of it is not recycled at all.

Plastic waste exports

The plastics industry is now adopting the tried-and-true practices of international waste traders worldwide. By exporting their wastes to less-industrialized countries, U.S. plastics corporations have learned, they can avoid domestic regulations and community opposition to waste-handling facilities, and pay their workers wages far below U.S. levels.

It is increasingly likely that the plastic bags and bottles dropped off at a local recycling center in the United States will end up in the countryside in China or in an illegal waste importer’s shop in Manila.

Last year alone, over 200 million pounds of plastic waste were exported from the United States, according to data from Port Import/Export Research Service. This waste was sent to Argentina, Brazil, Chile, China, the Dominican Republic, Ghana, Ecuador, Guatemala, Hong Kong, Hungary, India, Indonesia, Israel, Jamaica, South Korea, Malaysia, Morocco, Nigeria, Pakistan, the Philippines, Russia, Singapore, South Africa, Taiwan, Tanzania, Thailand, and Trinidad and Tobago.

The primary target of U.S. plastic waste exporters is Asia. In 1991, more than 15 million pounds of plastic waste were shipped to the Philippines, 35 million pounds to Indonesia and over 75 million pounds to Hong Kong (much of which was sent on to China).

Industry recycling coalitions tout exports for diverting waste from diminishing U.S. landfill capacity while providing much needed employment in less-industrialized countries. In a September 1991 issue of Plastics News, Gretchen Brewer, a consultant with Earth Circle in La Jolla, California, justified plastic waste exports to Asia because "they have an urgent need to employ a lot of people, and it also helps them get more raw materials."

The U.S. Chamber of Commerce also denies that there are any problems with plastic waste exports. Harvey Alter, manager of the Chamber’s Resources Policy Department, testified last fall in a Congressional hearing on the subject. "There is no basis," he assured lawmakers, "for accusations that the United States is ‘dumping’ hazardous (or other waste) on unsuspecting developing countries. Materials for recycling, virtually by definition, are sold to enterprises in countries with sophisticated manufacturing facilities."

Since there are no federal oversight mechanisms or standards for plastic waste exports, no one really knows what happens to the millions of pounds exported annually. Harrie Cohen, chief executive officer of Ontario Plastics Recycling in California, admits that he sends all of the plastic collected by his firm to China. "I don’t know exactly what they’re doing with it," he told a Plastics News reporter last year. Apparently, the U.S. "cradle to grave" approach to waste management, which requires tracking and monitoring at all stages from waste production to transport to disposal, does not apply if the grave is in another country.

A Greenpeace investigation of "recycling" facilities in Asia reveals that plastic waste is being shipped to countries which ban waste imports, that recycling facilities are endangering workers and the surrounding environment and that much of the plastic sent to be recycled is simply dumped in landfills or in random locations.


U.S. plastics "recyclers" sent over 35 million pounds of plastic waste to Indonesia last year. The majority of the waste was sent to two cities on the island of Java - Jakarta and Surabaya.

Once the waste arrives in Indonesia, it undergoes labor-intensive sorting by hand. First, workers separate for disposal the non-plastic wastes - newspapers, clothing scraps, metal scraps and miscellaneous other trash - that are imported along with the plastic cargo. Plastics that are either too contaminated or of such poor quality that recycling is not feasible are added to the discard pile. The owner of one Indonesian plastics recycling company estimates that up to 40 percent of the imported waste is directly landfilled at a local dump.

A large grinding machine transforms the separated plastic destined for recycling into flakes or pellets. Workers rinse these pellets with water to remove the residues and contaminants from the waste. This water, after rinsing many loads, is dumped onto the dirt floor or out the back door of the recycling plant.

The pellets, sometimes mixed with new plastic or other additives, are melted and forced through an extruder which shapes the hot plastic into long cords. These cords, once cooled, are chipped again and sent to manufacturing plants in Asia to be made into shoe soles, containers or toys.

The plastic processing all happens indoors, in hot, crowded rooms with no ventilation systems. Recycling facilities in the United States, in contrast, are equipped with vacuum vents over the plastic melting machines to immediately remove fumes from the workers’ environment.

Hong Kong and China

Hong Kong is the largest single importer of U.S. plastic waste. In 1991, it received more than half of all U.S. plastics waste exports.

The recycling facilities in Hong Kong look much the same as those in Indonesia. The same plastic grinding, melting and re-shaping machines are in use, releasing the same strong noxious fumes. As in Indonesia, the untreated rinse water is discharged down drains or out the window. One difference is that, in real-estate scarce Hong Kong, the recycling shops are located on the fourth, eighth or eleventh floors of run-down industrial skyscrapers. The piles of plastics and the heat from the melting machines pose an obvious and frightening fire hazard in these densely packed buildings.

Of the 10 plastic recycling facilities Greenpeace investigated, the sophisticated equipment described by the U.S. Chamber of Commerce’s Alter was nowhere to be seen. In fact, Hong Kong is only now in the beginning stages of negotiations for the first chemical waste treatment facility in the entire territory.

A number of plastic waste importers in Hong Kong simply warehouse waste en route to China. Many of these importers once processed the waste in Hong Kong but have since found land and labor costs much lower in the mainland.

A visit to a plastics recycling company in China revealed more of the same basic processes, but a different setting. Instead of the crowded slums of Jakarta or the industrial skyscrapers of Hong Kong, the facility was located on a dirt road in the countryside in Guangzhou. Since the area was suffering an electricity black-out the day of the investigation, none of the machinery was in operation.

The plastic waste is sorted in a walled-in courtyard which is also the site for worker housing. On one side of the courtyard, men pile huge cardboard boxes of plastic scrap. The boxes bear many of the same names as the plastic bags exported to Indonesia: Dow , Monsanto , General Electric , Du Pont . On the other side of the courtyard, less than 10 feet from the piles of plastic garbage, children play and women hang laundry to dry.

A massive pile of discards - unrecyclable plastics, clothing, scraps, and other garbage - occupy the center of the courtyard. The facility manager explains that there is no central dump in which this material can be disposed, so it is dumped in random locations in the countryside.

Last August, six containers exported from New York Harbor and supposedly carrying plastic waste arrived in Shanghai, China. When the Chinese plastic waste importers opened the containers, they discovered a grisly concoction of U.S. waste. Eight months later, the Shanghai City Environmental Protection Bureau sampled the containers and reported: "55 percent are ... mostly household garbage, blood transfusion bags, and tubes. In order to prevent pollution, you must immediately request a professional unit to thoroughly sterilize the waste plastic and household garbage."

The Philippines

Although the Philippines has a strict law banning waste imports, U.S. corporations and waste brokers shipped over 15 million pounds of plastic waste to the country in 1991. As is the case in many waste-importing countries, underfunded customs and environmental agencies are unable to detect and intercept incoming waste shipments. And since the shipments are arranged covertly, the locations of the importing companies are unknown.

But the situation is not hopeless. Activists in the Philippines, working in conjunction with their counterparts in the United States, have begun to take steps to stop illegal plastic exports to the Philippines.

Environmental and development organizations in the Philippines and the United States have formed a coalition to stop the illegal waste imports into the Philippines. Rene Salazar, director of the Southeast Asia Regional Institute for Community Education (SEARICE), a Philippine development organization and member of the new Coalition Against Toxic Waste, is demanding that his government take a more active role on this issue. "The toxic waste trade is a fast-growing industry as North Americans and Europeans do not wish to destroy their own backyards," he explains. "Mafia-like export companies are enticing Third World countries with potential profits to be made from trade in toxics. We have a complete list of all the imports of waste into the Philippines in 1991. We challenge the Philippine government to tell us where it went."
Using data from the U.S. Department of Customs, the new Coalition has begun tracking ships known to have carried the waste from the United States in the past. On April 1, 1992, activists from the United States and the Philippines boarded two waste- trading ships in New York Harbor: the Evergreen line’s Ever Guest, which carried plastic waste to Indonesia, Hong Kong/China, and the Philippines last year, and the Mitsui OSK line’s Alligator Liberty, which also carried plastic waste to Hong Kong/China.

Wearing "Hazardous Exports Prevention Patrol" uniforms, the activists met with the captains of both ships and requested that they refuse to participate in the international waste trade. Maximo Kalaw, Jr., president of GreenForum Philippines, explained to the captains that, although the United States allows waste exports, unloading the waste in the Philippines is illegal.

After the captains refused to cease carrying waste from the United States to the Philippines or elsewhere in Asia, the Hazardous Exports Prevention Patrol hung a large banner on the Ever Guest’s hull which announced, "Hazardous Exports to Asia Begin Here." Philippine members of the Coalition Against Toxic Waste are planning to greet the ships when they arrive in Asia.

Hopefully, the efforts of the Coalition will work to prevent waste traders from conducting "business as usual," says Nicanor Perlas, president of the Philippine Center for Alternative Development Initiatives (CADI) and a member of the Coalition. "We want to send a strong message to these irresponsible companies that the world has changed," Perlas says. "Citizens all over the world are informing each other and collaborating on ways to cut down the anti-social and environmentally destructive behavior of corporations."


Waste Trade Regulations in the Making

CURRENT U.S. WASTE EXPORT REGULATIONS require importing countries to consent to the imports before they are sent - but they only apply to wastes legally classified as "hazardous" under U.S. law. Any person or company may load a barge with plastic or metal scrap, municipal garbage, sewage sludge or incinerator ash and send it to any country without notifying either the U.S. or the importing country’s government.

The U.S. Congress is currently in the process of overhauling the Resource Conservation and Recovery Act (RCRA), the nation’s major waste law. Title V of the new RCRA will deal with international waste trade.

A number of bills have been introduced this year to amend the waste export section of RCRA. Proposals range from a complete ban on the international waste trade, introduced by Representative Ed Towns, D-New York, to a virtual free-trade-in-waste bill supported by the Bush Administration.

The industry coalitions and front groups that promote plastics recycling to the public are also busy promoting waste exports for "recycling" on Capitol Hill. So far, they have been successful in obtaining a complete exemption for plastic waste exports in each proposed bill, except Towns’s Waste Export and Import Prohibition Act.

- A.L.


Two Months’ Plastic Garbage Exports

Plastic Scrap Exports to Asia,

February 1-March 31, 1992

Country Number of Shipments Total (lbs)

China (directly) 6 210,894

Hong Kong 586 37,746,957

India 11 2,198,339

Indonesia 50 4,952,518

Japan 5 112,797

Korea 6 241,866

Malaysia 7 561,530

Pakistan 1 41,533

Philippines 58 5,385,902

Singapore 5 157,350

Thailand 6 273,071

Taiwan 6 344,611

TOTAL 747 52,227,368

Calculated from Port Import/Export Research Service data.

Names in the News

Tobacco Rackets

THE U.S. ATTORNEY IN BROOKLYN, NEW YORK is investigating several tobacco companies for possible criminal violations of the federal Racketeer Influenced and Corrupt Organizations (RICO) statute, the Tobacco Products Liability Project reported in May.

"I do know definitely that the investigation has been undertaken," says Richard Daynard, of the Tobacco Products Liability Project. "I have no idea what stage it is in."

Tobacco on Trial, the publication of the Tobacco Products Liability Project, reported that the U.S. Attorney’s office is considering applying the RICO statute to a pattern of alleged fraud by tobacco companies that was revealed recently in the New Jersey discovery decision, Haines v. Liggett. The U.S. Attorney of the Eastern District of New York, Andrew Maloney, would not comment on whether an investigation is being conducted.

The RICO statute prohibits the use of income gained from a pattern of racketeering activity to acquire an interest in any enterprise engaged in interstate or foreign commerce. This language is broad enough to cover many tobacco companies’ acquisitions, such as R.J. Reynolds ’ purchase of Nabisco, or Philip Morris ’ acquisition of Kraft and General Foods , if the tobacco profits used to acquire these companies were obtained through "racketeering activity," Tobacco on Trial reported.

The U.S. Attorney would probably use the RICO statutory provision forbidding mail fraud, says Tobacco on Trial. The tobacco industry has placed ads in magazines and newspapers sent through the mail since 1954 that may be considered fraudulent. These ads claimed that independent research cast doubt on the consensus scientific view that smoking causes fatal diseases, and that the tobacco industry was pursuing research to resolve these doubts, according to Tobacco on Trial.

Busting Bristol-Myers

BRISTOL-MYERS SQUIBB COMPANY, one of the world’s largest pharmaceutical corporations, pled guilty in April to charges of illegally discharging pollutants into Syracuse-area waters.

As part of the plea agreement with New York State and the United States Attorney’s office in Syracuse, the Manhattan-based company has paid $3.5 million in criminal fines and penalties and agreed to build a waste water pre-treatment facility that is required to cost between $10 million and $30 million.

Bristol-Myers Squibb admitted in the plea agreement to discharging chemical pollutants into water treated by the Onondaga County Metropolitan Syracuse Wastewater Treatment Plant during September and October 1987, in violation of the federal Clean Water Act.

Bristol-Myers also admitted to discharging hazardous solvents into Ley Creek, which flows into Onondaga Lake, without having obtained permits from the New York Department of Environmental Conservation. In March 1990, the company assured state and federal officials that it would stop polluting the lake.

Bristol-Myers Squibb said in a prepared statement, "We accept our responsibility and believe that the terms of the settlement are in the best interests of the Syracuse community. ... These incidents are not characteristic of our record as an environmentally responsible company. At no time has the public health been affected or at risk."

Absolut Absurdity

THE MANUFACTURERS OF ABSOLUT VODKA are claiming a satirical Absolut Vodka ad titled "Absolut Nonsense" has caused "irreparable damage" to the company’s reputation. The ad appeared in Adbusters Quarterly, a publication of the Media Foundation, a Vancouver, British Columbia- based public interest group that is concerned about over-commercialization in North America. Absolut has threatened legal action against the Foundation unless it surrenders the remaining copies of the magazine, publishes a retraction and agrees never again to publish similar material.

The ads look like an Absolut Vodka ad, but the copy reads "Any suggestion that our advertising campaign has contributed to alcoholism, drunk driving or wife and child beating is absolute nonsense. No one pays attention to advertising."

Keith McIntyre, national marketing manager for Absolut Vodka Canada warned Adbusters not to run the ad. "If you want Absolut to play hardball, then Absolut will play hardball," McIntyre told Kalle Lasn, director of the Media Foundation.

Lasn charges Absolut with engaging in censorship. Lasn says that he plans to send another satirical ad, titled "Absolute Silence," to more than 100 magazines around the continent as a public service.

"We believe our ‘Absolut Nonsense’ ad is fair comment on an issue of profound social concern," Lasn said. "Absolut profits greatly from the association of its product with pleasure, parties, Christmas, and a host of other appealing, upscale cultural icons - but what about the negative associations?"

Surgeon General Antonia Novello has put the cost of alcohol abuse to society at over $100 billion a year. Novello claims that children see 100,000 alcohol commercials before they reach the legal drinking age.

- Ben Lilliston

Book Review



By Roger Moody

London: Partizans, 1991

195 pp.

The Gulliver Files:

Mines, People and Land: A Global Battleground

By Roger Moody

London: Minewatch, 1992

894 pp.

Reviewed by Holley Knaus

RIO TINTO ZINC - RTZ - is perhaps the archetypal multinational corporation. RTZ is an enormous, arrogant, anti-worker, racist conglomerate with a neo-colonial mindset and a penchant for leaning hard on governments that refuse to go along with its plans for their countries’ land and resources. London-based RTZ operates in more than 40 countries and makes its money by mining, a practice which destroys the earth and uproots communities.

RTZ has not gone unchallenged. Since its founding in the late nineteenth century, the company has met with worldwide opposition to its activities, most notably from environmental groups and organizations of indigenous people fighting to save their land and way of life. People Against RTZ and its Subsidiaries (PARTiZANS) is a global network dedicated solely to fighting the company.

PARTiZANS has published Plunder!, a comprehensive history both of RTZ’s misdeeds and of efforts by activists to counter the company’s onslaught against indigenous communities, workers and the environment. Plunder! is written by Roger Moody, founder of the London-based Minewatch and a long-time participant in the struggle against RTZ. Moody also wrote the recently published The Gulliver Files, an exhaustive account of the activities of the mining industry worldwide, and another book in which RTZ plays a featured role.

Plunder! traces the history of RTZ’s subsidiaries in the Pacific Rim, Africa, the Americas and Europe. While operations vary from region to region, RTZ’s methods remains very much the same. In case after case, Moody reveals how RTZ moves in to a country, co-opts the government or mows it over, steals land from its traditional owners, destroys the land, suppresses or buys off indigenous opposition, exploits its workers and gives little or no benefit to the country in which it is operating.

RTZ has perhaps been most arrogant and callous in its dealings with the indigenous communities which live on the land that the company wants to mine. The company’s attitude toward land stewardship is best summed up by a remark made by Sir Roderick Carnegie, chair of CRA, an RTZ subsidiary, at the 1984 RTZ shareholders’ meeting. "The right to land depends on the ability to defend it," he said.

The forced removal of two indigenous communities at Weipa, Australia to make way for RTZ’s bauxite mining operations resulted in devastating social breakdown in the area. At Bougainville in Papua New Guinea, RTZ destroyed vast areas of traditional indigenous rainforest and farmland. At Lake Argyle in Western Australia, the company destroyed sites sacred to the Mirriwung Kijja people. RTZ’s uranium mining operations at Elliot Lake in Canada have leached poisonous heavy metals and acids into rivers and lakes essential to the survival of the Serpent River Band.

Plunder! also documents RTZ’s relationship with the governments of the countries in which it operates. RTZ has never met with much opposition from leaders of pro-foreign investment dictators like Indonesia’s Suharto, and was welcomed in the Philippines under Marcos and in Chile under Pinochet.

But even in countries less likely to allow a corporation to run the show on its own, RTZ has managed to exert extraordinary influence over government officials. In 1970, in New Zealand, government officials were offered shares in RTZ subsidiary Comalco the day before they were offered to the rest of the public. In 1979, RTZ subsidiary US Borax discovered vast quantities of molybdenum at its Quartz Hill property in Alaska - within a 56 million acre area that had recently been designated by President Carter as inviolable under the Alaska National Interest Land Act. RTZ/Borax launched an aggressive, well- funded lobbying campaign. In December 1980, over the opposition of U.S. environmental organizations and Carter himself, Congress passed the National Interest Conservation Act, which waved RTZ into a national park. And in the 1970s, RTZ was a major player in a uranium contract and price-fixing scheme which Moody says consolidated and extended the company’s influence over key government personnel in South Africa, Canada and Australia.

Plunder! further reveals the company’s appalling indifference to the working and living conditions of its workers. At the Palabora mine in South Africa, migrant black workers for many years received wages far below the minimum set by the South African Institute of Race Relations - between 1966 and 1971, RTZ paid the miners about 5 million pounds, while pulling in profits of 140 million pounds during the same period. The notorious Rossing uranium mine in Namibia was built by workers separated from their families and housed in temporary camps. South African researchers Gillian and Suzanne Cronje found the Rossing workers’ conditions "akin to slavery." In 1989, the General Secretary of the Mineworkers Union of Namibia claimed that "92 percent of all black and 51 percent of all colored workers still remain in the company’s lowest income bracket, [which does not] constitute a living wage ... black workers in the Exploration department have no house, no housing allowance. Their conditions in crowded army-style tents are, in fact, the worst in the mining industry."

Moody manages to insert some hope into the book by covering struggles - a few successful - against the company. Armed resistance at Bougainville led to the closing of the mine in 1989. International support of the land rights claims of the Guaymi Congress in Panama in the mid-1980s forced RTZ to puts its plans for the Cerro Colorado mine on hold. Recently, a coalition of dairy farmers, environmentalists and Chippewa Indians formed to fight RTZ’s mining of the Flambeau copper deposit in Wisconsin.

Plunder! is a valuable resource for groups like these because it makes plain RTZ’s strategies and tactics - one of which is to conquer and divide its opponents. But Plunder! is also an important book for the more general reader because it makes so clear just how much power a multinational company can wield, and to what destructive ends that power is often put.

Plunder! is overwhelming in its meticulous detailing of RTZ’s dirty history (the same can be said for the even more comprehensive The Gulliver Files). But, as Moody points out in The Gulliver Files, these books should not be seen simply as references. He writes, "It is hoped that readers will make links between various corporate endeavors, and see for themselves how certain trade practices ... bring riches to multinationals at the expense of the rest of us."

There is another reason that Plunder! deserves a more general readership. It gives voice to the life-and-death concerns of those people directly affected by the company’s mining operations - workers and members of indigenous communities. One tactic employed by indigenous groups over the years has been to send delegations to RTZ stockholder meetings. Al Gedicks points out in his foreword to Plunder! that their presence at these meetings makes it impossible for the general public to ignore the consequences of mining on native communities. Plunder! provides another opportunity for these voices to be heard.



Rainforest Action Network

450 Sansome, Suite 700

San Francisco, CA 94111

Friends of the Earth -

Papua New Guinea

P.O. Box 4028

Boroko, NCD



1436 U Street, NW

Washington, DC 20009

Village Development Trust

P.O. Box 2937

Lae, Morobe Province


Wau Ecology Institute

P.O. Box 77

Wau, Morobe Province


CAFCA - Campaign Against Foreign Control of Aotearoa

P.O. Box 2258



Asia-Pacific Solidarity Links

P.O. Box 13-367



Australia Asia Worker Links

P.O. Box 264

Fitzroy, VIC. 3065


Publication: Asian Workers



218 Liverpool Road

London N1 1LE


Publication: Parting Company


218 Liverpool Road

London N1 1LE


Survival International

310 Edgware Road

London W2 1DY


Freeport McMoran

First Interstate Bank Building

One East 1st Street, Suite 1600

Reno, NV 89501


225 Bush Street

San Francisco, CA 94104


200 E. Randolph Drive

Chicago, IL 60601

Rio Tinto Zinc

6 St. James Square

London SW1Y 4LD


United Church of Christ

Commission for Racial Justice

700 Prospect Avenue

Cleveland, OH 44115

Southwest Network for Environmental & Economic Justice

211 10th Street, SW

Albuquerque, NM 87102

Institute for Black Chemical Abuse

2616 Nicollet Avenue South

Minneapolis, MN 55408

National Association of African-Americans for Positive Imagery

3536 North 16th Street

Philadelphia, PA 19140

United Steelworkers of America

Five Gateway Center

Pittsburgh, PA 15222

Tobacco Products Liability Project

c/o Northeastern University

Law School

40 Huntington Avenue

Boston, MA 02115

The Media Foundation

1243 West 7th Avenue

Vancouver, BC Z68 1B7


Books, Reports & Periodicals

West Papua:

The Obliteration of a People

By Carmel Budiarjo and

Liem Soie Liong

Surrey, UK: TAPOL, 1988


The Indonesia Human Rights


111 Northwood Road

Thornton Heath

Surrey CR7 8HW


Down to Earth

International Campaign for

Ecological Justice in Indonesia

P.O. Box 213

London SE5 7LU


Dumping in Dixie: Race, Class and Environmental Quality

By Robert Bullard

Boulder, CO: Westview Press, 1990

In Search of the New South: The Black Urban Experience in the 1970s and 1980s

Edited by Robert Bullard

Tuscaloosa, AL: University of Alabama Press, 1989

"Toxics and Communities of Color"

The Minority Trendsletter,

Summer 1991

Center for Third World Organizing, Oakland, CA

Toxics Waste and Race

in the United States

United Church of Christ Commission for Racial Justice, 1987

Past Exposure: Revealing Health

and Environmental Risks of Rossing Uranium

By Greg Dropkin and David Clark

London: The Namibia Support Committee, 1992

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