The Multinational Monitor

  May/June 2004 - VOLUME 25 - NUMBERS 5 & 6

B E H I N D    T H E    L I N E S

World Bank Degradation

The World Bank in June approved an infrastructure project in Mexico that environmental organizations say marks a watershed in weakening the Bank's social and environmental standards.

The $108 million investment loan will finance a series of infrastructure projects in the Mexican state of Guanajuato.

What was novel about the loan is that the Bank has agreed to set aside its own environmental and social safeguard policies and to instead rely on Mexican laws and procedures, many of which do not meet the Bank's existing standards.

The project is the first major pilot of a new middle-income country strategy that the World Bank is currently preparing. The strategy calls the Bank's social and environmental safeguard policies "obstacles to timely quality lending," and recommends that future Bank projects rely only on national social and environmental standards rather than the Bank's own safeguard policies.

Just prior to approval of the Mexico loan, nearly 200 nongovernmental organizations from 60 countries sent a letter to the World Bank protesting its proposed new policy.

In the case of the Mexican loan, local environmental groups point out that unlike the World Bank, Mexico does not have a law on the involuntary resettlement of project-affected people, and the Mexican law on environmental assessments is much weaker than current Bank policy in critical aspects.

"The environment has been seriously degraded in Mexico, and more than half of Guanajuato's population lives in poverty," says Arturo Morales Tirado, president of the Mexican Audubon Society in Guanajuato. "This requires that the World Bank comply with its strictest social and environmental standards in its new infrastructure project."

"It is disturbing that, contrary to international trends, the World Bank seems to consider environmental standards an obstacle rather than an added value of its lending," says Peter Bosshard, policy director of the Berkeley, California-based International Rivers Network.

In-Sourcing Oversight

If everything else in Iraq can be privatized and outsourced, at least responsibility for the oversight of such operations should be maintained inside the government.

The U.S. Senate in June was able to agree to a measure adopting this principle, as Senators Ron Wyden, D-Oregon, and Byron Dorgan, D-North Dakota, won approval of an amendment prohibiting renewal of any contracts outsourcing oversight of Iraq reconstruction.

The amendment, accepted for inclusion in the Department of Defense reauthorization bill, also prohibits future private oversight contracts unless the U.S. government is entirely unable provide personnel to perform direct oversight, and prohibits the letting of private contracts if there is even an appearance of conflict of interest for the private company.

"Oversight should be performed by the government and not private contractors, particularly those with apparent conflicts of interest," said Wyden. "The outsourcing of oversight on Iraq reconstruction is a costly, unsound practice that never should have been permitted in the first place and it's time to close the door on it now."

"Our amendment makes clear that oversight of how billions of taxpayer dollars are spent is a fundamental responsibility of the government, not something to be handed off to other private contractors," said Dorgan.

Wyden, Dorgan and Representatives Henry Waxman, D-California, and John Dingell, D-Michigan, in May unveiled a report detailing nearly $130 million in spending on reconstruction.

Greenpeace Beats The Rap

The Bush administration's attempt to use a dusty "sailormongering" law to prosecute Greenpeace failed in May when a federal judge in Miami dismissed the charges in the midst of the trial.

"America's tradition of free speech won a victory today, but our liberties are still not safe," said Greenpeace Executive Director John Passacantando. "The Bush administration and its allies seem bent on stifling our tradition of civil protest, a tradition that has made this country stronger throughout its history."

The case stems from a protest that took place several miles off the coast of Florida in April 2002.

Two Greenpeace activists peacefully boarded a ship that was carrying illegal mahogany wood from the Brazilian Amazon into the Port of Miami.

The activists, who clearly identified themselves as Greenpeace, intended to hang a banner that read "President Bush: Stop Illegal Logging."

The individuals involved in the protest were arrested, and misdemeanor charges against them were settled later that year.

Instead of intercepting the illegal mahogany and prosecuting the smugglers, the Justice Department filed criminal charges against Greenpeace on July 18, 2003.

Greenpeace was charged under an obscure 1872 law against "sailormongering," aimed not at protestors but at inns and brothels that would attempt to lure sailors to their establishments.

Invocation of this law to prosecute peaceful protesters generated worldwide protest. Those criticizing the prosecution included Al Gore, Senator Patrick Leahy, the NAACP, the ACLU of Florida and People for the American Way.