Names In the News

Bootstrap Hypocrisy

Robert Woodson Sr. believes that poor people need to stop relying on the government, to stop relying on what he calls "the poverty industry" and to pull themselves up by their own bootstraps.

In his recent book, The Triumphs of Joseph -- How Today's Community Healers Are Reviving Our Streets and Neighborhoods, Woodson argues that "in one sense, poor blacks are more victimized today by black-on-black greed, corruption and incompetence than they are by racists."

Fifteen years ago, he split from the civil rights movement and started his own group, the National Center for Neighborhood Enterprise.

Over those 15 years, Woodson says he has raised $15 million to keep the Center running. Much of it has come from corporations, corporate executives and corporate foundations. In 1989, Amoco Foundation gave the Center $3.5 million for a six-year project to promote resident management and ownership of public housing. This year, State Farm Insurance gave the Center $170,000 to fund an annual "Achievement Against the Odds" awards dinner. Proctor & Gamble gave $10,000. IBM has given $25,000.

Woodson says that his current budget is $2 million. But he refuses to reveal a complete list of donors.

When asked what big corporations see in his work, Woodson says that his political philosophy comports well with that of his corporate donors. "Yes, I am more sympathetic toward corporations because they have interests that are more compatible with the grassroots groups that I work with," Woodson says.

While Woodson is highly critical of government anti-poverty programs, he is hardly ever critical of corporations or corporate power. He has recently lashed about against insurance red-lining regulations, a position which comports well with the political philosophy of one of his funders, State Farm Insurance.

In his book, he writes that "many corporations are also suffering because a number of their antagonists have lobbied for excessive regulations on their business."

"Regulations now compel insurance companies to insure in high-risk locations," Woodson writes. "In these areas, banks and insurance companies have difficulty making the same kind of character judgements they make every day in middle- and upper-income areas."

State Farm v. Ford

State Farm insurance charged in January that Ford Motor Co. covered up fire hazards in 26 million Ford vehicles sold between 1983 and 1993.

In a lawsuit filed in federal court in Los Angeles, State Farm alleges that Ford manufactured and sold the vehicles with a defective ignition switch that produces an electrical short that may result in the melting and ignition of flammable plastic components located on or near the vehicle's steering column.

The nation's number one auto insurance company alleges that Ford learned about the defective ignition switch in 1988 and by 1991 had instituted an extensive redesign of the switch to reduce the risk of fires.

But Ford and the manufacture of the switch, United Technologies Automotive (UTA), nonetheless "knowingly and deliberately concealed this defect from the motoring public" and from federal safety officials until April 1996, when mounting evidence of widespread fires forced Ford to recall 8.7 million vehicles.

State Farm is seeking to have Ford pay more than $200 million for insurance claims tied to ignition switches that short-circuited and caused 64,000 fires.

Ford denies the charges and says it will defend itself against the charges in court. In a prepared statement, the company says it considers the State Farm lawsuit a "replay of an unsuccessful lawsuit" in which State Farm sought to intervene in a class-action lawsuit against Ford in New Jersey." A federal judge denied certification of the class and State Farm withdrew those claims.

"Now, State Farm has resubmitted essentially the same allegations in a different court," Ford says in a statement. "Ford will defend itself vigorously against these sweeping charges, which are baseless and without merit."

Twinkie Recall

Careful with those Twinkies.

Citing a "substantial danger to the environment, public health and welfare," Illinois Attorney General Jim Ryan in January filed a lawsuit against Interstate Brands Corp., the makers of Hostess Twinkies.

The lawsuit forced the shutdown of a Chicago Interstate Brands facility where an allegedly illegal asbestos removal operation caused a 21-state recall of more than one million Hostess products.

The recall applies to all Hostess and Dolly Madison snacks with the code 57 that were produced since January 11, 1998.

Ryan alleges that in January a state health inspector was sent to the plant to investigate reports of improper asbestos removal. The inspector saw "piles of debris which tests confirmed was asbestos, a known human carcinogen." The lawsuit alleges that the inspector observed "uncovered, finished bakery products within 20 feet of where the asbestos removal had taken place."

State officials also allege that a worker at the facility, acting on orders from supervisors, removed asbestos insulation from a water tank in the plant's boiler room and "wheeled the uncontained asbestos-containing insulation through the facility's production area in an open cart ... as close as 10 to 20 feet from the facility's production lines."

Interstate Brands did not return calls seeking comment.

-- Russell Mokhiber