TEN WORST THE 10 WORST CORPORATIONS
OF 1989 By Russell Mokhiber Russell Mokhiber is the editor of the Corporate
Crime Reporter, an investigative weekly based in Washington, D.C. IT HAS
BECOME fashionable for environmentalists and public interest groups to
shy away from pointing fingers at individual corporate or executive wrongdoers
and to blame "the system." Thus, in the wake of the crime at Valdez, the
spill of millions of gallons of crude oil by Exxon into the waters off
the coast of Alaska, Greenpeace, the world's premiere environmental group,
said it would be strategically wrong for citizens to send the company a
message by boycotting its products. "It would be easy," read the copy for
a recent Greenpeace ad, "to blame the Valdez oil spill on one man. Or one
company. Or even one industry. Too easy. Because the truth is, the spill
was caused by a nation drunk on oil." So, according to Greenpeace, it is
not Exxon's driving that caused the problem, it's people who drive cars.
In the most fundamental sense, we are each accountable for our future.
Greenpeace argues that had the oil not spilled in the Prince William Sound,
it would have concluded its useful life fouling the air of the lower 48
states and eventually the entire planet, in the form of carbon dioxide,
nitrogen oxide and a host of other gases that contribute to acid rain and
global warming. Good point. Moving toward an alternative energy future
is important. Still, we have to deal with the crimes of the present on
a case-by-case basis. Those who wield great power, and those who abuse
it, must be held primarily accountable. Even in an age of gluttony, where
consumerism has run rampant and where consumers have delegated control
of the technologies that feed their habits to corporate chieftains who
abuse their trust with recklessness that often results in destruction,
a primitive standard of justice demands that systemic change be accompanied
by a modicum of personal and institutional accountability. It is in this
spirit that we present "The Ten Worst Corporations of 1989." This list
is our effort to point fingers, to pinpoint the blame and to hope that
people demand and secure justice by joining boycotts, pressing for prosecutions
and putting culpable individuals behind bars. This is the second year that
we have run the "Ten Worst" list. The companies profiled here are large
corporations that wield vast power, often recklessly, and often to the
detriment of the environment, workers, consumers, and governments. If left
unchecked, the consequences of their behavior will be far worse than the
damage profiled here. BURROUGHS WELLCOME: Shameless Profiteering If in
1989 you had AIDS or the HIV virus, and you needed the life-prolonging
drug AZT, or azidothymidine, then you had no choice but to turn to Burroughs
Wellcome Co., and its parent, the London-based Wellcome PLC. And if you
needed AZT for one year, it would cost you $8,000. Why? Because that's
what Burroughs Wellcome said it would cost. And Burroughs Wellcome is the
only company that manufactures AZT. The AZT monopoly and the high cost
of the drug made health groups furious with Wellcome. They charged that
Wellcome was a "corporate extortionist" engaged in "shameless profiteering".
For the three years ending on August 27, 1988, Wellcome's profits doubled,
to $198 million. The company's gross profit margin on AZT is an industry
high 70 to 80 percent. Wellcome denies unjust profiteering. The company
said that it needed to recoup its up-front investment in AZT, which included
paying for a major clinical trial. But gay activists are angry that Wellcome
is profiteering from what was essentially taxpayer- funded research. "Wellcome
acquired AZT years ago," reported Marilyn Chase in the Wall Street Journal
on September 15, 1989. "But it didn't create the compound, it wasn't the
first to discover its effectiveness against AIDS-type 'retroviruses', it
didn't uncover its effectiveness against AIDS itself and it didn't conduct
the first human tests. Much of that work was done by other scientists,
some at the National Institutes of Health with federal funding." AIDS activists
argue that victims are essentially made to pay for the drug three times.
An August 31, 1989 letter to Burroughs Wellcome Co., USA, from more than
a dozen organizations and individuals devoted to the welfare of people
with HIV infection, said that the victims were forced to pay for the drug's
initial development, for the many studies needed to permit its marketing
as taxpayers and finally to buy it from Burroughes-Wellcome. While the
company issued blanket denials that it was profiting unjustly from the
drug, it has refused to release the actual costs of development and production.
The company claims that most of its dividends go to charity, and much of
the profits are plowed back into research and development. The company
itself is 75 percent owned by the Wellcome Trust, a nonprofit organization
that has spent millions on pharmaceutical research. Nevertheless, AIDS
activists took to the streets in the United States and Britain. Five people
were arrested on Wall Street as they chained themselves to a balcony inside
the New York Stock Exchange. AIDS activists picketed and protested the
company's Research Triangle, North Carolina headquarters around the clock
since early August 1989, when researchers expanded the drug's potential
market from 20,000 victims to 650,000. Within weeks, the company was on
its knees. On September 18, the company cut the price of the AZT drug by
20 percent. Activists called the move a "good first step". But the New
York City-based AIDS Coalition to Unleash Power, or ACT UP, observed that
the company's announcement was "a pretty strong indication that the company
has been profiteering all along." EXXON: Arrogant and Complacent On March
24, 1989, in the worst oil spill in U.S. history, the Exxon Valdez supertanker
ran aground, broke open and spilled more than 11 million gallons of crude
oil into Prince William Sound off the coast of Alaska. Exxon responded
to this environmental catastrophe with grotesque smugness. When asked to
compare the disaster to the one at Bhopal, Exxon's chief executive officer,
Lawrence G. Rawl told reporters that Exxon had "nobody dead." Rawl said
he didn't understand what all the fuss was about. He blamed God for the
accident and attacked the Coast Guard and the state of Alaska for a botched
cleanup. The State of Alaska has declined to prosecute Exxon for the spill.
The Alaska Attorney General's office explained that the most stringent
penalty available to the state was a misdemeanour oil spill violation carrying
a $100,000 fine. "Given the severity of the acts, the costs and extent
of investigation and prosecution and given the tools that the federal government
has in the way of laws, felony provisions, and treble damages, we believe
it was appropriate to leave it to the federal government," said Larry Weeks,
chief of the Attorney General's criminal division. "If someone commits
a murder, but can only be convicted of a misdemeanour, it's demeaning to
the process," Weeks said. A federal criminal investigation of the spill
is ongoing. A 110- page report on the spill prepared by the Alaskan government
and submitted to the National Transportation Safety Board (NTSB) concluded
that the probable cause of the accident was the failure of the ship's Master
to manage and supervise his crew properly and his having left the bridge
while passing through the ice-laden water of Prince William Sound. But
the report also blasted higher-ups at Exxon as well as the Alyeska Pipeline
consortium, claiming that poor management by the Exxon Shipping Co. and
the "massive failure" of Alyeska in responding to the spill greatly contributed
to its severity. "The real causes of the Exxon Valdez disaster," wrote
Alaska oil spill coordinator Robert LeResche, "were not heroic but only
pedestrian. There was not a berserk captain waving a bottle on the bridge,
there was not an autopilot device run amok, there was not a broken radar,
or a storm. There were simply arrogant and complacent people at the top
levels of Exxon Shipping Co. and Alyeska Pipeline Service Co. who did not
pay attention to their responsibilities." LeResche reported that although
the oil industry views the absence of major accidents prior to the Valdez
grounding as an "endorsement" of its Alaskan operations, the Exxon spill
"should bring Exxon Shipping and Alyeska to the sobering realization that
the past history of relatively uneventful Valdez operations is no cause
for cheer or complacency. The NTSB's report on the grounding of the Exxon
Valdez hopefully will cause the shipping industry to change their retrogressive
attitudes and approaches toward marine safety and the environment." It
is possible that only the Exxon Valdez' Captain, Joseph Hazelwood, will
take the heat for the spill. ln May, 1989, a state grand jury in Anchorage
returned felony indictments against Hazelwood on charges of criminal mischief
in the second degree. The grand jury considered evidence that Hazelwood
had been drinking, that he left the bridge in the hands of an unqualified
third mate and that he was responsible for the ship's automatic pilot being
engaged during a portion of the maneuvers leading up to the grounding.
The indictment also alleged that Hazelwood's post-accident actions to free
the tanker from the reef caused additional damage to the ship and possibly
contributed to the size of the spill. The Hazelwood case has yet to go
to trial. Federal officials are not, and should not be, content with putting
lower-level Exxon employees behind bars. MOBIL: Public Nuisance While Exxon
was getting the headlines, Mobil was avoiding the spotlight. For good reason.
In California, Massachusetts, and around the country, Mobil was polluting
the environment and endangering peoples' lives. In April, 1989, the city
of Torrance, just outside of Los Angeles, California, citing the fear of
a "disaster of Bhopal- like proportions," filed a lawsuit against the Mobil
Oil Corporation seeking to have the refinery declared a public nuisance
and giving the city authority to regulate it. Torrance officials were concerned
that an uncontrolled release of acutely toxic hydrofluoric acid from the
refinery could threaten the lives or health of hundreds of thousands of
Torrance residents. "Mobil cannot now guarantee with reasonable certainty
that a fire, explosion, malfunctioning equipment or some other accident
would not cause an uncontrollable release of acutely hazardous chemicals,"
the lawsuit charged. City leaders claim that over the past five years,
Mobil has been cited an average of 13 safety violations per year, many
of which involved multiple infractions. The city dismissed the company's
payment of fines that followed the notices of violations, alleging that
"Mobil's routine payments of fines for these violations amounts to the
purchase of a license to pollute in excess of state standards set to protect
the health of California citizens." Citing Mobil's disgraceful safety record,
the city detailed many of the 127 safety violations at the refinery that
were reported to the Fire Department. "They have a lot of hydrofluoric
acid in the refinery. It is a catalyst that is used for increasing the
octane of no-lead fuel," City Attorney Kenneth Nelson told Multinational
Monitor at the time. "There were a number of laboratory tests done in Nevada
on hydrofluoric acid. Under the atmospheric conditions as existed during
that testing session - hot, desert conditions - they discovered that the
stuff can vaporize after an accidental spill or explosion and move down-
wind in a very rapid manner in such concentrations as to be extremely deadly
... That got a lot of publicity. Then, it was discovered that at any given
time there are approximately 26,000 gallons of hydrofluoric acid in this
refinery." In July 1989, the city followed up the civil lawsuit by filing
criminal charges against Mobil, alleging violations of state safety standards
in connection with a July 1988 explosion that killed one man and burned
two others. The charges were later dismissed. In Massachusetts, state officials
ordered Mobil to place advertisements in major newspapers around the state
urging other companies in the same business to comply with state environmental
laws and to upgrade their facilities to protect the environment. The state
had charged Mobil with failing to report the discovery of a leaking tank
at a Mobil service station on Route 132 in Barnstable. The tank posed a
potential threat to municipal water supplies. And in December 1989, Mobil
pleaded "no contest" to criminal charges stemming from two 1988 pipeline
ruptures which resulted in the spill of more than 130,000 gallons of crude
oil, most of which flowed into the Los Angeles River and the city's sewer
system. NESTLE Neutralizing Critics The international boycott of Nestle
products is still on. Nestle still markets its infant formula around the
world to induce sales in violation of the World Health Organization (WHO)
infant formula marketing code. Boycott organizers are concerned about Nestle's
marketing of the infant formula in Third World countries, where mothers
often mix the formula with tainted or unsanitary water, leading to illness
and death for hundreds of thousands of babies each year. According to UNICEF,
at least one million babies could be saved each year through breastfeeding
alone. An earlier worldwide boycott conducted in the 1970s was called off
when organizers deemed Nestle to be in compliance with the WHO code, but
the boycott call was renewed in October 1988 amid charges that Nestle had
changed its practices and was no longer in compliance. As the Monitor reported
earlier this year [See, "Nestle Undercover," Multinational Monitor, May
1989 at 21], Ogilvy & Mather, the giant advertising and public relations
firm, devised an international operation to "neutralize critics" of infant
formula, according to an internal Ogilvy & Mather document leaked to
the media in February 1989. Nestle hired Ogilvy to help it control negative
publicity associated with the boycott. The program outlined in the Ogilvy
document, titled "Proactive Neutralization: Nestle Recommendations Regarding
the Infant Formula Boycott," is "built around the idea of neutralizing
or defusing the issue by quietly working with key interest groups." Both
Ogilvy and Nestle distanced themselves from the document and the suggested
program after it was leaked to the press. Nestle said that it rejected
the recommendations made in the Ogilvy paper. Political damage control
was underway. The program gave Ogilvy the responsibility for "interest
group assessment and monitoring." The objective, according to the document,
was to "initiate an early warning system through which Nestle gains awareness
of actions being planned, and is equipped to take appropriate proactive
or active steps. A second objective was to "neutralize critics." The Ogilvy
plan also suggests that Nestle sponsor a "Nestle Positive Image Campaign"
to run on Channel One, a 12-minute daily satellite television news show
produced by Whittle Communications. Channel One was designed "to inform
students of the world around them, in a way that stimulates and promotes
questions." The show planned to reach 8,000 schools by the fall of 1989.
"There is an existing opportunity to be a (or THE) major sponsor of Channel
One," the document implores. "The idea for Nestle, however, is not to advertise,
but to donate the 30 seconds on daily/weekly airtime for Nestle-sponsored
additional daily news programming: FOOD FOR THOUGHT." Tim Smith, head of
the Interfaith Center on Corporate Responsibility (ICCR), was amazed by
the proposal. "Unfortunately," Smith told the Monitor, "this new revelation
reminds the churches of Nestle's frequent use of dirty tricks and facile
public relations almost a decade ago. The church community calls on Nestle
to deal with the real issue of formula supply and infant health rather
than taking the low road in a diversionary public relations campaign."
PERDUE FARMS: Abuse, Fear and Harassment In the 1970s, people working for
Frank Perdue would gut and cut up to 50 chickens a minute. Now, they find
themselves cutting more than 90 a minute. The workers perform two or three
motions over and over for a whole day, thousands of times a day. The consequences
are tendonitis and carpal tunnel syndrome, a crippling repetitive motion
disorder. A report by National Public Radio reporter Daniel Zwerdling in
April, 1989 found that Perdue employees at the central Lewiston, North
Carolina facility suffer from high rates of carpal tunnel syndrome. A physician
who studied the problem told Zwerdling that he had personally seen 75 to
80 cases of the syndrome among Perdue workers. Zwerdling obtained an internal
Perdue memo explaining that it is normal procedure for "about 60 percent
of the work force to visit the plant nurse every morning for Advil, Vitamin
B-6 treatment and hand wraps" in order to be able to work on the processing
line. Line workers are expected to process up to 75 chickens a minute and
receive little rest time. J. Davitt McAteer, executive director of the
Occupational Safety and Health Law Center in Washington, D.C., found that
"breaks for processors last exactly 12 minutes, during which time a worker
has to remove her apron and coat, wash off the blood, remove up to three
gloves, her hat and ear phone, walk to the restroom (in some instances
a substantial distance from the line), return, put back on all of the equipment
and step back into line." All this happens in the 12 minutes allocated
for the break, which is given not on demand or according to the body's
needs, but rather when the supervisor shows up and says, 'It's your turn."'
Perdue's employees are not unionized. More than two-thirds of them are
black women, often illiterate, who must choose between unemployment in
rural North Carolina and dangerous work for Perdue at $5.45 an hour. "The
abuse they showed me when I went to them with my problem was unbelievable,"
Donna Bazemore told the Monitor [See, "Perdue Farms: Poultry and Profits,
by Bob Hall, Multinational Monitor, September 1989]. "The fear, the harassment
is so bad, I call it a closed-in slave camp." In 1987, Bazemore became
the first Perdue worker to win worker's compensation for carpal tunnel
syndrome in North Carolina. "Most people just can't take it," she told
the Monitor. "The pay is good for these rural areas, but the treatment
is inhuman. They actually feel like they own you." As Americans turned
away from red meat, they turned to chicken and Perdue Farms' business soared.
The rising interest occurred in tandem with lower standards of sanitation.
The United States Department of Agriculture (USDA) admits that 37 percent
of the birds it approves are contaminated with salmonella, up from 29 percent
in 1967. One internal USDA report said the figure is actually as high as
76 percent in some plants. "Poultry productivity has outpaced all U.S.
manufacturing since 1960," reported the Institute for Southern Studies,
a Durham, North Carolina-based activist group in July 1989, "but the industry
ranks as one of the ten most dangerous in the country. Profits have soared,
yet wages remain below the average for the food industry. People are eating
record quantities of chicken as a healthy alternative to red meat, but
the rate of food poisoning from contaminated birds is on the rise." The
problem with Perdue might reflect the ethics of its founder, Frank Perdue.
Perdue the man, the chicken magnate who has spent millions of dollars on
television advertisements cultivating his "tough guy" image, was charged
with recklessly and negligently killing a man in a highway accident 15
years ago, yet he walked away without a trial, according to a report in
Southern Exposure magazine in July 1989. On October 30, 1974, Perdue's
car collided with two cars on the Pennsylvania Turnpike, killing one of
the other drivers. Investigators say that Perdue was speeding and apparently
ignored or overlooked warning signs and red lights as he entered a lane
reserved for oncoming, detoured traffic. Perdue was charged with involuntary
manslaughter, arrested and released on $500 bail, but the case was dismissed
on May 12, 1975 "because it was not tried within the 180 days as required
by Pennsylvania law," federal investigators reported. According to the
Southern Exposure report, Perdue hired Philadelphia lawyer Arlen Specter,
the city's former district attorney and later a U.S. Senator., who successfully
defended him. The magazine also reported that since the highway death 15
years ago, Perdue has been convicted of speeding 16 times in Maryland alone.
When he purged 55 pro-union workers at a plant in 1980, the United Food
and Commercial Workers (UFCW) union called for a national boycott of Perdue
products. Perdue sued the union and allegedly solicited aid from the Gambino
crime syndicate in New York to further his union-busting efforts. The mafia
turned him down, but Perdue has successfully busted all unionizing efforts
to date. PHILIP MORRIS: Innocence by Association When word first leaked
in Washington that Philip Morris, the company that brought us the Marlboro
Man and other purveyors of death and disease, was planning an ad campaign
in conjunction with the National Archives to promote the Bill of Rights
on the advent of the document's 200th anniversary, many laughed it off
as a ridiculous rumor. Then came the slick television ads. There was the
Philip Morris logo. And there was the Bill of Rights. And there was the
deep voice telling Americans what a great country they live in. The propriety
of the arrangement between the Archives and Philip Morris was questioned
by a number of Congressional officials, including John Conyers, D-Mich,
chairman of the House Government Operations Committee, who instructed the
General Accounting Office to review the deal. Other members of Congress
called on the Justice Department to determine whether the television ads
run by the company violated the 1971 law banning televised cigarette commercials.
Rep. Chester Atkins, DMass, likened the company's association with the
Bill of Rights to the efforts of the Medellin cocaine cartel to fund children's
basketball leagues in Colombia. "In both instances, it is an attempt to
buy friends and respectability," Atkins said. Public Citizen called the
effort "a joint venture that smears the Bill of Rights with the blood of
all Americans killed as a result of smoking Marlboro and other Philip Morris
cigarettes." Public Citizen charged the company with "spending tens of
billions of dollars to addict tens of millions of Americans to often-lethal
smoking habits." Michael Pertschuck, co-director of the anti-smoking Advocacy
Institute, called the Philip Morris/Archives deal an effort by the company
to achieve "innocence by association." Last year, Philip Morris' Marlboro
cigarettes killed another 75,000 Americans. Cocaine killed 5,000. While
the company was in the United States pushing the Bill of Rights, it was,
as a leading player in the infamous U.S. Cigarette Export Association,
seeking to break down an increasingly vocal wall of anti-smoking activists
throughout Southeast Asia. The Reagan administration pressured Japan, Taiwan
and South Korea to open their markets to U.S. cigarette companies. And
the Bush administration, proving its allegiance to the tobacco interests,
followed suit in the spring of 1989, when Bush's U.S. Trade Representative,
Carla Hills, threatened Thailand with trade sanctions if it didn't open
its markets to American cigarettes. Thailand has had a longstanding policy
banning both domestic and foreign cigarette advertisements on television,
radio, newspapers and magazines. Philip Morris argued that this ban constituted
an unfair trade practice. But Bush met a rising tide of protest from both
Asian and American anti-smoking activists. In the United States, Hills
was pressured to hold hearings on the Thailand issue, and more than 20
anti-smoking activists testified against her bullying. In Thailand, anti-smoking
activists made the tobacco import issue a hot political topic for Prime
Minister Chatichai Choonhavan. "To export cigarettes and coerce foreign
governments into liberalizing their cigarette market, while simultaneously
restricting the promotion and use of cigarettes in home markets [the United
States], is clearly a case of double standards," read one Thai anti-smoking
leaflet. In a May 31, 1989 letter to Hills, 17 members of Congress warned
Hills that to pursue trade sanctions against Thailand would perpetuate
"an extraordinarily expensive and ultimately lethal health risk abroad."
The members of Congress said it was "hypocritical" for the United States
to consider a television advertising ban abroad an unfair trade practice
while at the same time considering a ban on television ads in this country
a "national health priority." By July 19, 1989, the American Public Health
Association (APHA) had collected more than 140,000 signatures calling for
a change in U.S. tobacco trade policy. The APHA pointed out that an estimated
2.5 million people die annually from smoking-related diseases and that
last year alone the U.S. exported 100 billion cigarettes. Until recently,
most Asian countries had either banned or heavily taxed foreign cigarettes.
Since 1985, Japan, Taiwan and South Korea were forced to open their markets
as a result of U.S. trade pressures. The results will be increased death
and disease. Since 1985, Japanese cigarette sales have increased 2 percent,
reversing a 20-year downward trend. And the average Taiwanese consumed
80 more cigarettes in 1987 than in 1986, all of them foreign. PHILLIPS
PETROLEUM: Death on the Job On October 23, 1989, an explosion and fire
at the Phillips Petroleum Co.'s Pasadena, Texas facility killed 22 workers
and injured 124 others. The blast occurred after a polyethylene reactor
at Phillips' Houston Chemical Complex released and ignited a huge vapor
cloud. The blast could be heard from miles around and created a fireball
visible for 15 miles. Phillips' environmental director Bill Stolz said
that the explosion was caused when a seal blew out on an ethylene loop
reactor, releasing ethylene-isobutane, a compound used in making plastics.
The Phillips plant makes 4.5 million pounds of plastics daily for milk
jugs and toys. Union officials called the blast and the resulting death
and injury a "foreseeable consequence" of known problems with plant operations.
Robert Wages, vice president of the Oil, Chemical and Atomic Workers Union
(OCAW), told Congressional investigators that a preliminary union investigation
revealed three primary factors leading to the fatal explosion: an inadequate
safety policy governing the maintenance of the plant's chemical reactor
systems; the use of subcontractor maintenance crews to work on reactor
systems as a cheaper substitute to the regular Phillips workforce; and
an inherently flawed reactor design. A Texas state government heavily influenced
by the petrochemical industry seems to have precluded the kind of criminal
investigation into possible homicide, reckless homicide, reckless endangerment
or similar offenses that have been conducted in similar cases from California
to New York. Federal officials, including the U.S. Attorney in Houston,
however, might look at possible criminal violations of federal occupational
safety and health laws. Gerard Scannell, the newly appointed safety-conscious
director of the Occupational Safety and Health Administration (OSHA), expressed
concern about the fact that OSHA has cited the Phillips facility for a
number of serious violations over the last several years but has not performed
a comprehensive inspection of the site since 1975. Scannell pledged to
review the criteria used by OSHA to prioritize inspections, and to evaluate
the adequacy of the agency's current staffing levels and resources. Scannell
told Congressional investigators in November that "a full and thorough"
investigation is underway to determine the causes of the explosion and
whether there were any violations of OSHA regulations. Wages, appearing
before the Employment and Housing Subcommittee of the House Government
Operations Committee in November 1989, testified that the key element contributing
to the accident was the fact that the Phillips plant employed a "maintenance
lock- out policy" which was "inconsistent with OSHA standards and good
industry practices." A "lock-out" policy compromises the procedures followed
to ensure that maintenance is not performed on live chemical reactor systems
unless they are sealed off, disconnected or otherwise freed from the hazards
of unwanted movement or releases. Wages testified that the absence of appropriate
controls during maintenance work performed on October 23, resulted in key
valves being left open. The open valves, in turn, may have allowed the
massive vapor release and explosion, he speculated. Wages also raised questions
about Fish Engineering and Construction, the primary maintenance subcontractor
at the Houston Chemical Complex. "The union investigation has identified
several specific safety-related incidents that relate to the training and
experience of the subcontracted workers," Wages said. He described a number
of accidents involving Fish employees, including a "lock-out" incident
last August which resulted in one death and four injuries. "Fish Engineering
subcontractors opened piping to the off-gas scrubber tank without isolating
the line," Wages said. 'The line vented flammable solvents and gas into
an adjoining work area. The gas and liquid ignited and burned the workers,"
he added. Wages cited other factors that contributed to the explosion,
including "pressures to keep production rates up, a relentless effort to
reduce labor costs by reducing the proportion of Phillips employees on
the plant workforce, a flawed alarm and evacuation program and inadequate
enforcement of OSHA regulations coupled with a lack of appropriate regulations."
ROCKWELL INTERNATIONAL: Serious Contamination On June 6,1989, 70 federal
agents raided the Rocky Flats nuclear weapons facility in Colorado. The
decision to invade the bomb plant came on the heels of a lengthy investigation
described in FBI agent Jon S. Lipsky's 116-page affidavit, which convinced
a federal judge to unleash the agents. In his report, Lipsky accused Rockwell
International and the U.S. Department of Energy (DOE) of "knowingly and
falsely" stating that the plutonium- processing plant complied with federal
environmental laws. In doing so, the contractor and its government client
concealed "serious contamination" at the site. Lipsky charged that Rockwell
and DOE secretly dumped hazardous waste into public drinking water and
surreptitiously operated an incinerator they said had been shut down. A
report by Representative John Dingell's Subcommittee on Oversight and Investigations
of the House Energy and Commerce Committee found that the DOE identified
pervasive health and safety problems at the Rocky Flats Plant involving
inadequate fire protection, inadequate protection of workers from plutonium
contamination and an ineffective quality assurance program. The subcommittee
reported that the DOE closed down operations at one of the key weapons
buildings at Rocky Flats due to radiological control problems, including
the exposure of three people to potentially high levels of plutonium contamination.
The subcommittee also reported that on March 7, 1985, the Governor of the
State of Washington toured the Hanford reservation in Richland, Washington.
Just prior to the arrival of the Governor's party near a site contaminated
with radiation, and on direct orders from Rockwell Hanford Operations management,
signs which warned of the radiation hazard were removed. A part of the
Governor's entourage passed right through the contaminated area, unaware
of the hazard. According to Dingell investigators, "Rockwell covered up
this incident for almost one year until the matter cam to the attention
of the media and subcommittee." According to Rockwell's former head of
safety at the facility, "members of the Waste Management Program Office
have repeatedly put pressure on members of the Radiological Protection
Department to remove posting signs in areas of contamination." In September
1989, Rockwell management sought assurances from federal and state authorities
that the company would not be prosecuted. But those assurance were not
forthcoming, so Rockwell sued the authorities, seeking to clarify its liability.
"We have filed suit very reluctantly,n said Rockwell Chairman Donald Beall.
"But we simply cannot expose our employees and the company to the risk
of criminal charges arising out of good faith actions under the contract
and at DOE's direction." Federal authorities seemed offended by Rockwell's
quest for immunity and in October 1989, Rockwell, under serious public
pressure and facing a federal grand jury probe in Denver, agreed to pull
out of the Rocky Flats contract. The federal criminal probe is ongoing.
VELSICOL: Deadly Double Standard No chemical company its size has as dirty
a record as the Velsicol Chemical Co. of Tennessee. Velsicol is the world's
only producer of the pesticides chlordane and heptachlor, two pesticides
banned in the United States because they are considered probable human
carcinogens. Yet, according to a report by the environmental group Greenpeace,
over the last two years Velsicol has exported approximately 5 million pounds
of the chemicals to at least 25 countries. The ongoing dumping of these
two cancer-causing agents on poorly protected countries of the Third World
etches a deadly double standard on the company's bottom line. For years,
consumer groups in the United States have been pressuring the U.S. Environmental
Protection Agency (EPA) to ban the chemicals from use in this country.
In 1978, the EPA responded in part by mandating an end to most U.S. agricultural
applications of chlordane and heptachlor after studies indicated that they
were carcinogenic in lab animals, highly persistent in the environment
and accumulative in the food chain. And in 1988, the EPA struck a deal
to end all domestic sales of the products. That deal, however, allows Velsicol
to continue to sell the chemicals abroad under a provision of the federal
pesticide law which permits the production and export of pesticides prohibited
for use in the United States. Greenpeace officials called for the repeal
of that "dumping" provision. Greenpeace charged that the loophole has created
a "circle of poison" whereby The production of banned pesticides by companies
such as Velsicol results in severe contamination both here and abroad and
poses a serious threat to U.S. public health when we import foreign-grown
produce treated with the toxic chemicals. In a report released in September
1989, Greenpeace found that an important consequence of Velsicol's continuing
production of chlordane and heptachlor is the release of large quantities
of toxic pollutants into the environment surrounding the company's production
facilities. "The company's practices have contributed to, if not caused,
contamination to such an extent that at least three sites in which Velsicol's
pesticide wastes are implicated are now federal Superfund sites," the report
found. In 1987, according to the report, Velsicol released approximately
660,903 pounds of highly toxic chemicals, including chlordane, heptachlor
and carbon tetrachloride, into the air at plants in Marshall, Illinois
and Memphis, Tennessee. "In Memphis, Velsicol is permitted to dump toxic
waste from its manufacturing operations into the Memphis sewer system,"
the report alleged. Greenpeace maintains that Velsicol's exports of chlordane
and heptachlor violate provisions of the United Nations Food and Agricultural
Organization's voluntary code of conduct with regard to pesticide distribution.
The two pesticides are being used in particularly dangerous ways. The continued
use of heptachlor on sugar cane and fruit and vegetable crops in a number
of countries, for example, has led to significant contamination problems
as a result of the product's persistence in the environment and its transmission
through the food chain. Agricultural and other workers are also at risk
when they apply chlordane and heptachlor without adequate protection from
exposure. Greenpeace is seeking a repeal of the federal loophole that allows
production and export of pesticides banned for use in the United States.
Greenpeace calls the export provision a discriminatory double standard
that "codifies tacit approval of U.S. companies dumping their products
which are unwanted or highly toxic on developing countries." WASTE MANAGEMENT:
Criminal Recidivist Waste Management Inc., (WMI) the largest waste dumper
in the U.S., is also a repeat offender. Last year, its criminal record
became so offensive that the Environmental Grantmakers Association (EGA),
a coalition of foundations which gives money to environmental groups, began
giving serious consideration to a proposal to not allow for-profit corporations
to join its board. This move was precipitated by an attempt by Waste Management
Inc. to become an EGA member. EGA consists of 90 foundations that fund
national public policy and grassroots groups working for environmental
protection. Since 1987, the Association has met to share information and
ideas about issues and projects. Waste Management's presence at EGA meetings
since 1988 created controversy within the group and led to the December
1989 vote on corporate membership. Waste Management is the largest publicly
held waste disposal corporation in the United States. In March of 1989,
California Waste Management, a subsidiary, pleaded no contest in the largest
criminal antitrust case in California history, paying a record $1 million
fine. Waste Management of Florida pleaded no contest to price fixing in
Florida's Dade and Broward counties and was slapped with a $1 million federal
fine in January 1988. Waste Management also pleaded guilty in October 1987
to conspiring to fix prices in the Toledo, Ohio area with Browning- Ferris
Industries. And in May 1989, the U.S. EPA fined Chemical Waste Management,
a WMI subsidiary, a record $4.5 million for improperly burning PCBs at
a Chicago incinerator. Those opposed to WMI admittance to EGA argued that
Association members fund national and grassroots groups who undertake a
myriad of environmental projects, and many of these environmental groups
oppose the building of polluting disposal facilities, advocate toxic use
reduction and waste prevention and encourage communities to reduce solid
waste, all goals that conflict with WMl's interests. "The presence of WMI
in such a funding community raises disturbing questions about the kind
of information the corporation will obtain and about WMl's potential influence
on the opinions and decisions of grantmakers," said Peter Bahouth, executive
director of Greenpeace USA. "It also grants legitimacy to a corporation
sorely in need of a positive environmental reputation."