GE has a lengthy record of criminal, civil, political and ethical transgressions,
some of them shocking in disregard for the integrity of human beings.
Here are a few examples:
In 1995, with the establishment of a Presidential Advisory Commission,
the full extent of GEs human experiments with nuclear radiation
were revealed. General Electric ran the Hanford Nuclear Reservation in
Richland, Washington as part of the U.S. weapons program. Beginning in
1949, General Electric deliberately released radioactive material to see
how far downwind it would travel. One cloud drifted 400 miles, all the
way down to the California-Oregon border, carrying perhaps thousands of
times more radiation than that emitted at Three Mile Island.
In 1986, Representative Edward Markey, D-Massachusetts, held hearings
in which it was disclosed that the United States and General Electric
had conducted experiments on hundreds of United States citizens who became
nuclear calibration devices for experimenters run amok. According
to Markey: Too many of these experiments used human subjects that
were captive audiences or populations ... considered expendable
... the elderly, prisoners and hospital patients who might not have retained
their full faculties for informed consent.
One of GEs most gruesome experiments disclosed in the Markey
hearings was performed on inmates at a prison in Walla Walla, Washington,
near Hanford. Starting in 1963, 64 prisoners had their scrotums and testes
irradiated to determine the effects of radiation on human reproductive
organs. Although the inmates were warned about the possibility of sterility
and radiation burns, the forms said nothing about the risk of testicular
cancer. Markeys committee heard allegations that, at the time of
the experiments, General Electric violated both civil and criminal laws.
GEs nuclear testing is merely one example of a lengthy corporate
history of malfeasance that includes conviction of criminal price-fixing
in the 1960s and many equivalent deeds. This article highlights only General
Electrics recently adjudicated or settled criminal or civil violations.
GE is wholly or partially liable for at least 78 federal Superfund sites.
+ On September 29, 1998, General Electric
agreed to a $200 million settlement in principle of environmental claims
resulting from pollution of the Housatonic River and other areas by chemical
releases from GEs plant in Pittsfield, Massachusetts. (The settlement
was reached with the Environmental Protection Agency and the Department
The claims result from a long history of GEs use and disposal of
polychlorinated biphenyls (PCBs) and other hazardous substances at the
plant, which GE no longer uses for manufacturing. (PCBs, which have been
linked to cancer, were commonly used in electrical devices and lubricants
from the 1930s through the 1970s, when they were banned.)
Under the settlement, GE will remove contaminated sediments from the
one-half mile of the Housatonic River nearest the GE plant. Through a
cost-sharing agreement, GE will also fund much of the anticipated cost
of an additional mile-and-one-half of river cleanup to be conducted by
These river cleanups will include contaminated riverbanks and soils in
properties in the flood plain along the river. Later, after a cleanup
plan is selected for downstream portions of the river, GE will perform
that cleanup as well.
In addition, GE will remedy contamination at the Pittsfield plant and
other nearby areas, including a school and several commercial properties.
The settlement also will address claims that hazardous substances released
from the GE plant caused injuries to natural resources in the Housatonic
River downstream of the plant, extending through Massachusetts and into
In addition to cleaning up, GE agreed to pay $15 million in damages and
to conduct a number of projects designed to acquire or enhance wildlife
habitat. The damages payment will be used by the natural resource trustees
the U.S. Fish and Wildlife Service, the National Oceanic
and Atmospheric Administration, and agencies of Massachusetts and Connecticut
to restore, replace or acquire the equivalent of the injured
GE has also agreed to a brownfield redevelopment project
on a portion of the defunct plant, including a multi-million dollar investment
in Pittsfield, in conjunction with the new Pittsfield Economic Development
Authority (PEDA). PEDA will commit up to $4 million of anticipated
revenues from the redevelopment to further enhancement of natural resources.
+ On March 26, 1998, General Electric
agreed to pay a $92,000 fine for previous violations of environmental
reporting requirements for toxic releases at its silicone manufacturing
plant in Waterford, New York, according to EPAs regional office.
In addition, GE agreed to spend about $112,000 to upgrade local emergency
response capabilities in surrounding communities. Between 1991 and 1996,
EPA cited GE for 23 violations when toxic releases were un- or underreported.
Chemicals involved include dimethyl sulfate, chlorine, 1, 1, 1, -trichloroethane,
ammonia, and toluene.
+ On September 15, 1995, General Electric
agreed to pay $137,000 in fines and expenses and to clean up a hazardous
waste dump at a former plant where it repaired and rebuilt transformers.
The agreement was part of a settlement with the Florida State Department
of Environmental Protection.
In October 1993, investigators swooped down on the GE Apparatus Service
Center in Brandon, Florida with search warrants to take soil samples and
confiscate computer records and files. Inspectors found 30 violations,
including hazardous waste pumped from underground storage tanks into a
nearby railroad spur, reports show. They also discovered groundwater contaminated
with elevated levels of PCBs and a layer of petroleum and cleaning solvents
floating on the groundwater. Complaints from previous employees and discoveries
during routine inspections sparked a sheriffs offices investigation
of the center, where employees cleaned and serviced heavy-duty electric
motors and generators for 20 years.
GE closed the facility in December 1993.
+ On March 13, 1992, the Nuclear Regulatory
Commission (NRC) issued a $20,000 fine against General Electric for violations
of regulations at the fuel fabrication plant in Wilmington, North Carolina.
On May 29, 1991, GE personnel accidentally moved about 320 pounds of uranium
to a waste treatment tank. The danger of the mistake was that the size
and shape of the waste container caused unsafe concentrations of uranium,
which could have led to a nuclear accident. The NRC dispatched a special
incident investigation team the same day and an inspection began two days
later. The NRC found that the mistake was the result of lax safety controls.
+ According to documents obtained by
Public Citizen under the Freedom of Information Act, GE-designed nuclear
reactors around the world have a design flaw that make it virtually certain
(90 percent) that in the event of a meltdown, radiation would be released
directly into the environment and into surrounding communities, leaving
the public without any protection. The NRC acknowledges that the reactor
containment structure in GE-built nuclear power plants does not work,
but they licensed the reactors anyway. (Also, a dozen or more GE-designed
boiling water reactors in the United States and abroad have evidence of
cracking in the reactor core shroud a metal cylinder surrounding
the reactors radioactive fuel rods.)
+ GE continues to mislead government
officials and the public about the dangers of PCBs. At an April 22, 1998
shareholder meeting, GE CEO Jack Welch claimed: PCBs do not pose
adverse health risks. Testifying in Albany on July 9, 1998, EPA
Administrator Carol Browner stated: GE tells us this contamination
is not a problem. GE would have people of the Hudson River believe, and
I quote: living in a PCB-laden area is not dangerous. But
the science tells us the opposite is true ... And concern about PCBs goes
beyond cancer ... The science has spoken: PCBs are a serious threat...
+ GE was a big proponent, and prime
beneficiary, of the business-friendly initiatives undertaken
by former New York State Environmental Conservation Commissioner Michael
Zagata, who was ousted by Governor Pataki after a controversial tenure.
This business friendly policy, in 1995, let GE avoid paying
a fine and gave the company a tax write-off. The settlement, reached through
the program, let General Electric off the hook for permitting an industrial
landfill to burn out of control for nearly a year in Waterford, Saratoga
County. The deal allowed the company to avoid paying a fine, gave it a
$1.5 million tax writeoff, and resulted in a boat launch being built near
the Columbia County residences of former Environmental Conservation Commissioner
Michael Zagata and his chief deputy. (These business-friendly
initiatives were later rescinded.)
Defense Contracting Fraud
+ On July 23, 1992, GE pled guilty in
federal court to civil and criminal charges of defrauding the Pentagon
and agreed to pay $69 million to the U.S. government in fines one
of the largest defense contracting fines ever.
General Electric said in a statement that it took responsibility for the
actions of a former marketing employee who, along with an Israeli Air
Force General, diverted Pentagon funds to their own bank accounts and
to fund Israeli military programs not authorized by the United States.
Under the settlement with the Justice Department over violations of the
Foreign Corrupt Practices Act, GE paid $59.5 million in civil fraud claims
and $9.5 million in criminal fines.
+ GEs civil and criminal transgressions
stemming from the Israeli military program are by no means isolated. GE
is a repeat offender when it comes to Defense Department fraud. The company
has repeatedly violated the False Claims Act a measure originally
proposed by Lincoln to protect federal coffers. When the Project on Government
Oversight surveyed defense contractors, it found that General Electric
was responsible for 15 instances of fraudulent activity in just a four
year period (1990-1994) more than any other defense contractor.
1. Paid $7.1 million to settle a qui tam suit alleging that the company
failed to satisfy electrical bonding requirements for its jet engine
contracts, thereby creating a safety risk.
2. Paid $5.87 million (along with Martin Marietta) to settle a qui tam
suit associated with improper sales of radar systems to Egypt.
3. Paid fines between 1990 and 1994 ranging from a $20,000 criminal
fine to a $24.6 million civil fine for a variety of defense contracting
frauds, including: misrepresentation, money laundering, defective pricing
(2 incidents), cost mischarging (3 incidents), false claims, product
substitution, conspiracy/conversion of classified documents, procurement
fraud and mail fraud.
4. Was convicted on February 3, 1990 in U.S. District Court in Philadelphia
of defrauding the government out of $10 million for a battlefield computer
5. Pled guilty on May 19, 1985 to charges of fraud and falsifying 108
claims on a missile contract.
6. Was convicted of defrauding the Air Force out of $800,000 on the
Minuteman Missile Project.
7. Was convicted of bribing the Puerto Rico Water Resources Authority.
+ GE was among four companies which
paid New York City more than $4 million in 1982 to settle a lawsuit charging
that wiring and cables in 754 subway cars were defective.
+ GE in 1992 agreed to pay $165,000
to settle a suit brought by 11 state attorneys general alleging the company
deceptively advertised its lightbulbs. According to the state AGs, the
ads promised consumers the same amount of light for less energy, but in
fact the lightbulbs simply delivered less wattage.
+ GE Capital was ordered to pay $100
million for unfair debt collection practices, as part of a 1999 class-action
lawsuit settlement. The suit alleged that GE solicited agreements from
bankrupt creditors to pay their credit card agreements without notifying
bankruptcy courts of the agreements.
+ GE recalled 3.1 million dishwashers
beginning in 1999, stating that a side switch could melt and ignite, presenting
a fire hazard.
+ In April 2001, New York State AG
Eliot Spitzer won a ruling in state court that, in connection with the
dishwasher recall, GE falsely told consumers the problem could not be
repaired, prodding customers with partial rebates to buy new GE dishwashers.
+ Workplace Safety. The Occupational
Safety and Health Administration (OSHA) cited GE for at least 858 violations
of OSHA rules from 1990 through March 2001. From 1994 to 1999, OSHA cited
GE for at least 98 serious violations. OSHA issues serious
citations to companies for conditions posing a substantial probability
that death or serious physical harm could result.
+ Employment Discrimination. In a lawsuit,
a black worker at GEs Burkville, Alabama plant claims that General
Electric officials have fostered a racially hostile environment. GE reached
settlements with two ex-GE employees employed at the plant. The workers
claim that theyve been subjected to Ku Klux Klan symbols, swastikas
and a hangmans noose at the plant.
What distinguishes General Electric is not merely the number of crimes
committed or the dollar amount of the crimes but a consistent
pattern of violating criminal and civil laws over many years.
Exacerbating the situation, General Electric has been a leader in using
political influence to attempt to overturn the environmental and defense
contracting laws that it persistently violates.
The GE Rap Sheet
|23 March 1990
|Shepherdsville KY - GE and others ordered to cleanup
PCB contamination of soil and water
|27 March 1990
|Wilmington NC - GE fined for discrimination against
employees who report safety violations - $20,000
|11 May 1990
|Ft. Edward/Hudson Falls - GE ordered to clean
up PCB contamination of Hudson River - $10 million
|27 July 1990
|Philadelphia PA - GE fined for defrauding government
in defense contacts - $30 million
|11 Oct 1990
|Waterford NY - GE fined for pollution at Silicone
Products plant - $176,000
|20 May 1991
|Washington, D.C. - GE Ordered to pay damages over
improperly tested aircraft parts for Air Force and Navy - $1
|27 Feb 1992
|Allentown PA - GE ordered to pay damages for design
flaws in nuclear plants - $80 million
|4 March 1992
|Orange County CA - GE fined for violating worker
safety rules on handling PCBs - $11,000
|13 March 1992
|Wilmington NC - GE fined for safety violations
at nuclear fuel plant - $20,000
|22 May 1992
|Illinois - GE ordered to pay damages for design
flaws of nuclear plants - $65 million
|22 July 1992
|Washington, D.C. - GE fined for money laundering
and fraud over illegal sale of fighter jets to Israel - $70
|13 Sep 1992
|Chicago IL - GE ordered to pay damages for airplane
crash - $1.8 million
|12 Oct 1992
|Nashville TN - GE ordered to pay damages for deceptive
advertising on lightbulbs - $165,000
|27 Oct 1992
|Washington D.C. - GE ordered to pay damages from
overcharging on defense contracts - $576,215
|12 May 1992
|Washington D.C. - GE ordered to pay damages to
whistleblower on illegal sale of fighter jets to Israel - $13.4
|2 March 1993
|Riverside CA - GE and others ordered to pay damages
for contamination from dumping of industrial chemicals - $96
|11 March 1993
|Grove City PA - GE and others ordered to clean
up mining site - $1.81 million
|16 Sep 1993
|NY - GE ordered to compensate commercial fisherman
for PCB contamination of the Hudson River - $7 million
|11 Oct 1993
|San Francisco - GE ordered to offer rebates to
consumers after deceptive light bulb advertising - $3.25 million
|18 July 1993
|Hudson Falls NY - GE ordered to clean up PCB contamination
of Hudson R. - $2.5 million
|2 Feb 1994
|Perry OH - GE settles with utility
companies on defective Perry Nuclear Plant.
|14 Mar 1994
|Ft. Edward NY - GE ordered to clean up contamination
of sediment in the Hudson River - $100,000
|14 Sep 1994
|Washington D.C. - GE fined for overcharges in
defense contracts - $20 million
|2 Sep 1995
|Waterford NY - GE fined for air pollution and
contamination of Hudson River - $1.5 million
|15 Sep 1995
|Brandon FL - GE fined for groundwater contamination
|9 Sep 1996
|Waterford NY - GE Fined for Clean Air Act violations
|7 Oct 1996
|Hendersonville NC - GE ordered to cleanup contamination
of soil and groundwater - $1.029 million
|8 Oct 1996
|Cook County IL - GE ordered to pay settlement
from airline crash in Sioux City - $15 million
|22 Feb 1997
|Somersworth NH - GE and others ordered to clean
up contamination of groundwater and public water supply - $
|Waterford NY - GE fined for pollution violations
|20 April 1998
|Waterford NY - GE fined for pollution violations
|United Kingdom - GE ordered to pay for asbestos
cleanup and related pollution claims - 2 billion pounds
|26 Oct 1998
|Puerto Rico - GE and others ordered to cleanup
contamination of drinking water supply - $4.2 million
|5 Nov 1998
|South Whitehall PA - GE and others ordered to
cleanup contamination - $1.035 million
|24 Jan 1999
|Chicago - GE ordered to reimburse consumers over
unfair debt collection practices -$147 million
|19 Aug 1999
|Piscataway NJ - GE, others ordered to cleanup
contaminated groundwater - $23 million
|2 Sep 1999
|Malvern PA - GE and others ordered to clean up
groundwater contamination - $18.8 million
|17 Sep 1999
|Moreau NY - GE ordered to build drinking
water system after PCB contamination of water supply - $5 million
|9 Oct 1999
|Pittsfield MA - GE ordered to clean up PCB pollution
in Housatonic River - $250 million
|18 Oct 2000
|New York NY - GE and others ordered to clean up
contamination of soil - $28 million
|NY - GE and others ordered to refund overcharges
on mortgage insurance - $4 million
|4 Feb 2001
|NY - State Supreme Court rules GE deceptively
misled consumers into purchasing new dishwashers after recall
while sending commercial customers a replacement part.
GE Tax Abatement Ripoffs
A November 1998 Time magazine profile of GE concluded that [t]here
is no starker example of the phenomenon of corporate welfare and
vanishing jobs than General Electric Co.
The company has been a master at reducing its federal income tax
obligations, particularly through complicated arrangements whereby
GE stands in as the owner of assets for businesses that for one
reason or another cant use the tax breaks for these assets
[See Of Tax Cuts, Loopholes and Avoidance: Working for Tax
Justice, Multinational Monitor, June 2001].
General Electric has also proven itself adept at extracting tax
breaks and subsidies from local and state governments, even as it
has slashed employment.
This listing of subsidies is not a complete inventory. Because
state and local subsidies come from so many different sources
city agencies, county boards, regional bodies, state agencies and
state tax credits and because they take so many different
forms property tax reductions and abatements, training
grants, low-interest loans, investment tax credits, research and
development tax credits, job creation tax credits, sales tax waivers,
utility tax cuts, etc. there exists no centralized repository
of information about subsidies provided to GE or any other large,
Louisville: GE's Appliance Park has seen both subsidies
and job loss. Between 1984 and 1999, unionized employment declined
by almost 6,000, or 53 percent. In 1988, the state contributed to
$1 million worth of subsidies for a customer-service center, and
the previous governor had earlier pledged $3.5 million in annual
training funds for the refrigeration line. In a 1993 episode, the
State of Kentucky provided an estimated $19 million in tax breaks,
the City of Louisville and Jefferson County provided another $1
million in incentives, and the union gave contract concessions valued
at about $80 million, for total cost reductions of $100 million.
Recently, the union again granted concessions after the company
announced the relocation of range and laundry work to Georgia and
Mexico and indicated that refrigerator work was at risk of being
New York City: No U.S. city has been pressured more often
or at greater expense to give tax breaks to companies that say they
may leave than
New York. One of the earliest high-profile subsidy events
was the city's 1987 deal with the National Broadcasting Corporation
(NBC) for subsidies against the possibility that the network would
relocate its operations to New Jersey. (GE acquired NBC in 1986,
in the midst of the network's relocation decision-making process.)
The city provided a 35-year property tax cut worth an estimated
$72 million, $800 million in partly-tax exempt financing, a partial
rent tax cut and a waiver on city sales taxes on at least $1.1 billion
worth of machinery and equipment the network planned to buy. The
financing amount was about six times larger than the previous record
set by the New York Industrial Development Agency, $135 million
for Morgan Stanley & Co.
Other news reports of subsidies to GE include:
Lowndes County, Alabama: A GE plastics plant received millions
in local tax concessions in 1985 in one of the poorest counties
in the nation.
Melbourne, Florida: GE Harris Railway Electronics received
a state and local incentive package valued at $1.9 million for its
new corporate headquarters, including a 10-year property tax abatement.
Springfield, Illinois: Garrett Aviation Services, acquired
by GE in 1997, benefited from $8.5 million in tax-exempt revenue
bonds for an aircraft painting facility from the Capital Airport
Authority and from being included in a tax increment financing (TIF)
district, which provides a sales tax exemption on building materials.
Fort Wayne, Indiana: The city granted GE tax abatements
in 1983 when GE said it was moving consumer-product work to Mexico.
GE's aircraft-engine division was granted $2.5 million in federal
retraining funds when the company relocated about 800 jobs to Fort
Evendale, Ohio in 1983; the additional State of Indiana
subsidies raised the total package to $4.1 million.
Mount Vernon, Indiana: GEs plastics plant expansion received
a tax abatement valued at $1.3 million in 1988.
Bloomington, Indiana: GE received $150,000 for training
from Indiana for an expansion of refrigerator production in 1988,
and a total of $725,000 for training and road improvements from
the state in 1992. It also received a 10-year tax abatement package
from Monroe County in 1992, and possibly inclusion in a TIF district.
And in 1994, the state gave GE another training grant of $60,000.
Jeffersonville, Indiana: GEs GEA Parts L.L.C. received
a 10-year property tax abatement from the Jeffersonville City Council
when it consolidated operations there from New Concord, Ohio and
Bangor, Maine: A GE facility there received a STIF
or State TIF district, which provides for the state to rebate to
the company up to 25 percent of state income tax revenues generated
by new jobs, sometime prior to mid-1995.
New Hampshire: In 1985, the state's Industrial Development
Authority approved $1.75 million in industrial development bonds
Camden, New Jersey: In 1991, the state's Economic Development
Authority acted as a conduit for public funds from itself, Camden
County, the Urban Development Corporation and the Casino Reinvestment
Development Authority that subsidized a 575,000 square foot facility
that GE leased from a private developer; total private and public
funding was reportedly $65 million, including $46 million in bonds.
The state also provided a training grant of $374,500. (The facility
was taken over by Martin Marietta in a sale by GE in 1993.)
Evendale, Ohio: GE Aircraft Engines filed for tax abatements
through Evendale and Hamilton County Development Company in a 1997-1998
Hamilton, Ohio: A GE Aviation Service facility is located
in the Southwestern Ohio Industrial District, an enterprise zone,
under which companies are eligible for tax abatements of up to 50
Hebron, Ohio: GEs Newark Quartz Plant expansion in
1994 was slated to receive from Licking County a 75 percent property
tax abatement for four years and 50 percent for three years on new
Ravenna, Ohio: GE's lamp plant received tax abatements on
$17 million in new investments in 1994 from Portage County. The
10-year abatement was estimated to save GE $2 million. The abatement
was granted after a rumor circulated that GE might be looking to
relocate the plant.
Willoughby, Ohio: GE's Willoughby Quartz plant received
a tax abatement in 1994 on a $2.2 million addition, 75 percent for
seven years on equipment and 40 percent on real estate over four
years. The abatement was estimated to save GE $114,113, and was
to encourage GE to expand in Willoughby rather than in Newark, Ohio.
GE received an additional seven-year, $2.5 million tax break in
1995 on a $17 million expansion.
Philadelphia, Pennsylvania: GE benefited from a 1993 $50,000
training grant to Delaware Area Vocational Technical School to train
and retrain GE workers, and from a $218,315 training grant in 1993
to the same school for training and retraining.
Grand Prairie, Texas: GE received a 10-year inventory tax
abatement worth an estimated $280,000 in 1996 on a warehouse in
Southwest Industrial Park, into which the company announced
it was moving its regional appliance distribution center. The warehouse's
developer also received a 10-year 50 percent tax abatement worth