NEXT PAGE -->
|
TRENDS IN CORPORATE ACCOUNTABILITY -- WW III, Pt. 3
Most people want the same things:
** better education for their children;
** good health, especially for their children;
** a better environment (broadly defined to include housing, recreation, and transportation, in addition to clean air, water, and food);
** safer communities;
** more economic security;
** stronger families and family support;
** less government regulation and smaller government;
** fewer taxes;
** more local control.
Yet the American economic and political systems are not delivering most of these things to most people:
** Many school systems are deteriorating, public library budgets are being cut, and TV is "dumbing down" both adults and children: by the time they are 18, American children have been in school 11,000 hours but have spent 15,000 to 18,000 hours in front of a TV set;
** By many measures, children's health is declining --cancers are increasing, and so are diabetes, asthma, infectious diseases, excessive weight, and attention deficits, to name only the most obvious problems.
** Overall, as we have documented again and again, the environment is tending to get worse in many respects despite the relentless barrage of corporate "greenwash" claiming the contrary in the media;
** Many communities aren't safe and many more are not perceived as safe (thanks to the media's obsession with murder and mayhem in the local news);
** Most people are less well-off AND less secure today than they were 20 years ago (see REHW #567);
** Families are having a hard time because so many family members are working and the children are therefore somewhat neglected; spare time is shrinking; people are demoralized and stressed out by their lives outside the home so to numb themselves they allow TV to dominate their living rooms; elder care is a growing dilemma for most families; debt is growing; for many, retirement is a fading hope;
** Government IS getting smaller but not always in ways that help most people --for example, the Internal Revenue Service IS getting smaller but this just means more wealthy tax evaders are going unpunished; environment, health and social service agencies are facing budget cuts while public subsidies to corporate polluters are holding steady or rising;
** Taxes have been mounting for the middle class and the working poor while corporations and the rich are paying less of their fair share;
** And, finally, Congress SAYS it is giving more control to people at the local level while the REAL direction is to "globalize" decision-making, which means transferring control from local citizens to transnational corporations that answer to no one.
As a result of these trends, cynicism, depression and ennui are rampant among Americans; racism is increasing (even the President has noticed it is a problem) as more people compete for crumbs from a shrinking slice of the pie; most people don't vote (because candidates don't offer real alternatives --any that do are clobbered by the money bullies); so the system is stuck in a vicious circle in which power and wealth are relentlessly siphoned off into the pockets of a smaller and smaller fraction of the people. Forty percent of the people are doing well enough to continue to support the 1% who are becoming filthy rich --and the other 60%, who are hurting, nurse their wounds alone, disengaged, numbed by drugs or beer or television, or simply too tired to fight back.
Notice the key actors in the scenario just described: the media, government officials (elected), corporate decision-makers and the people. How are they related?
Ninety percent of the media are owned by fewer than 20 corporations that therefore dominate public discussion and debate; these corporations determine what people will talk about and the limits of the public discussion. The elected government is controlled by corporations through campaign contributions (which are required because expensive media exposure is the key to election); the people are made insecure, discouraged and disengaged largely because of corporate policies and practices (downsizing, wage cuts, forced give-backs, overseas flight, union busting --or simply the fear that any of these tactics will be used). Corporations control government; government greases the skids for increasing corporate control. People are disrespected and cut out of the decision-making loop. Democracy is hollowed out --the democratic forms remain, but the substance is missing. We can all vote, but voting seems to change nothing, at least not at the national level.
It is a vicious circle, self-perpetuating. BUT MAYBE THE CORPORATIONS WILL GO TOO FAR. Despite their obvious successes in the past decade, corporate elites seem bent on consolidating their power even further by insulating themselves COMPLETELY from popular control. Consider these trends:
1. SLAPP suits are increasing and have taken a new twist in recent months. SLAPPs are lawsuits intended to frighten people, to make them clam up. The new trend in SLAPPS is for companies to claim tortious interference with their profits and to demand compensation for alleged losses. Here is a typical scenario: a corporation is planning to pollute a community and deplete its resources (by building an incinerator, for example). A local group opposes the corporate proposal, defending the community, trying to maintain it as a nice place to live and work. If the defenders succeed, the corporation sues them, claiming that it has lost money because of the group's interference. The corporation demands huge compensation for its alleged losses. The defenders tend to get very quiet and focus on the struggle to maintain their lives in the face of a corporate army of lawyers trying to destroy them --and the next group of defenders thinks twice before speaking out. Our First Amendment rights begin to shrivel.
2. The Securities and Exchange Commission --a federal agency --is trying to insulate corporations from shareholders who might bring shareholder resolutions to change corporate behavior. In the recent past, such resolutions have changed corporate behavior in regard to apartheid, child labor and prison labor. Even though the vast majority of shareholder resolutions fail to gain a majority vote, they create a platform from which to expose and criticize corporate policies and practices. Now --this month --the SEC has proposed to modify SEC Rule 14(a)(8), to make it much more difficult (in many instances impossible) for shareholders to bring resolutions for a vote. If the SEC succeeds, it will further insulate corporate managers from influence by shareholders.
3. As we saw last week, the Clinton administration (with strong bipartisan support) is trying to lock the U.S. into a new "free trade" agreement --the Multilateral Agreement on Investment (MAI). The MAI would:
--Allow corporations to sue municipal, state and federal governments in an international tribunal, whose decision would be binding, with no possibility of appeal;
--Compensate investors in full when their assets are appropriated through "unreasonable" regulation;
--Limit or eliminate performance requirements (laws that require corporations to meet certain environmental standards if they want tax incentives or low-interest development loans, for example) --thus reducing (or eliminating) the possibility that communities might impose their values on corporate behavior;
--Remove all restrictions on international movement of capital, and disallow local laws favoring locally-controlled capital (such as a community-controlled redevelopment bank).
4. We saw earlier (REHW #552) that 19 states have now passed "audit privilege" laws. As the NEW YORK TIMES describes the trend, "Urged on by a coalition of big industries, one state after another is adopting legislation to protect companies from disclosure or punishment when they discover environmental offenses at their own plants." In essence, state laws are giving corporations immunity from punishment if they self-report violations of environmental laws. Furthermore, any documents related to the self-reporting become official secrets, cannot be divulged to the public, and cannot become evidence in any legal proceedings.
If a murderer confesses, he or she still faces prosecution. But these new "audit privilege" laws insulate corporate outlaws and polluters from accountability to governments and citizens. Under these laws, confession exonerates a corporation, and any documents related to the confession become secret and privileged, hidden from citizens who might seek redress for harms they suffered from the pollution. Further insulation from accountability.
5. Corporations are rolling back the system of environmental regulations at the federal and state levels. A tidal wave of regulatory reform is sweeping through every legislative body in the nation. These roll-backs have many different names: Project XL and the Common Sense Initiative (both Clinton proposals); ISO 14000; the Environmental Leadership Program; brownfields; air pollutant and water pollutant trading schemes; expansion of risk-assessment-based standard-setting procedures; new federal-state "partnership" agreements; and proposed new definitions of what constitutes solid and hazardous wastes.
All of these alternative proposals have a few common elements. They allow corporations to negotiate their own performance and pollution standards with governments. Because these negotiated standards are unique in each case, citizens have to understand each agreement on a case-by-case basis --and so do the government regulators. At a time when regulatory budgets are declining, the resources needed to negotiate with the polluters (and enforce agreements) are growing. Citizens can barely understand the present system of uniform standards. The new system is much more complicated, so citizens are effectively be cut out of the oversight process. In many instances, citizen lawsuits are specifically prohibited by these new arrangements. Thus the corporations are further insulated from citizens.
Today, corporate and government policies are working relentlessly to put more and more people out of work, substituting energy and materials for human labor (and in the process depleting natural resources and polluting the planet). For a long time such policies seemed to make sense. But today these policies are enriching the top 5%, creating the good life for the wealthiest 40% (at least in the short term) and destroying the future for the remaining 60%. THE ENVIRONMENT, DEMOCRACY, CIVIL SOCIETY, AND THE ECONOMY ARE THE SAME PROBLEM even though we (mistakenly) consider each separately.
As Paul Hawken said recently, "We can't --whether through monetary means, government programs, or charity --create a sense of value and dignity in people's lives when we're simultaneously developing a society that doesn't need them."[1] As the U.S. Conference of Catholic Bishops said in 1986, "Full employment is the foundation of a just society." Environmental justice will only be achieved when we have a semblance of economic justice.
Hawken says the solution is to "fire the unproductive kilowatts, barrels of oil, tons of material, and pulp from old-growth forests --and hire more people to do so." He says drastically reducing resource use will dramatically diminish our impact on the environment and create a multitude of new jobs. But will the big corporations allow the needed changes to occur? And what will happen if they don't? In the meantime, there's lots WE COULD BE DOING.
--Peter Montague
THE NATURE OF WORLD WAR III--PART 2
We saw last week (REHW #567) that the U.S. economy is no longer working for the benefit of most people. Although business is booming (stock prices, corporate profits and executive salaries have never been higher) --the average worker's wage has declined 19% during the past 25 years, family income has fallen 6% since 1989, good jobs with benefits are disappearing (being replaced by part-time, temporary jobs without benefits), while the tax burden has increasingly been shifted from the wealthy and from corporations onto the middle class and the working poor.
We are told that these changes are the result of "globalization" of the economy. And we are told that "globalization" is a natural phenomenon, like continental drift, impossible to resist or control.[1]
But globalization is the result of intentional laws and policies devised by corporate elites. Their goal is to further insulate corporations from control by governments, to enable corporations to continue consolidating wealth and power in the hands of a few people.
Most politicians are on board. Because TV is essential for election campaigns and because TV ads are very expensive, private wealth is now essential for election or re-election. This means politicians are beholden to the wealthy from the day they take office, and in recent years they have behaved accordingly: passing laws to reduce taxes on the rich and on corporations, helping corporations evade democratic control by enmeshing the U.S. in "free trade" agreements.
Take the GATT (General Agreement on Tariffs and Trade). The GATT was passed by Congress and signed by President Clinton in December 1994. The GATT agreement established the World Trade Organization (WTO). The WTO makes and adjudicates rules governing international trade but WTO officers and judges are not elected, so they are not democratically accountable.
WTO rules make a subtle legal distinction between traded products and "processing and production methods." Governments are allowed to use trade restrictions (import bans, for example) against products on scientifically-established health grounds, but they cannot limit imports because of social or environmental concerns over the way products are produced. For example, the European Union (EU) is trying to keep out milk produced by cows treated with Monsanto's bovine growth hormone (RBGH, or BST). Monsanto insists there are no health effects from drinking such milk (and there certainly is not worldwide scientific agreement on the matter), so WTO rules will eventually force the EU to accept milk from hormone-treated cows. Governments have lost their power to control products in ways that their citizens see fit. Through "free trade" agreements, corporations have gained immense power over government regulators.
A new "free trade" agreement is being debated at this moment --the Multilateral Agreement on Investment or MAI (sometimes called MIA). The MAI has been called a "corporate bill of rights" because it will greatly diminish the power of governments over corporations. As Scott Nova and Michelle Sforza-Roderick of the Preamble Collaborative in Washington, D.C. [phone: (202) 265-3263] have pointed out,[1]
"As proposed, the MAI would force countries to treat foreign investors as favorably as domestic companies; laws violating this principle would be prohibited. Under these conditions, transnational corporations would find it easier and more profitable to move investments, including production facilities, to low-wage countries. At the same time, these countries would be denied the tools necessary to wrest benefits from such investment --like laws mandating the employment of local managers.
"Efforts to promote local development by earmarking subsidies for home-grown businesses and limiting foreign ownership of local resources would also be barred. If adopted, the MAI will mean foreclosure of Third World development strategies, increased job flight from industrial nations, and new pressures on countries, rich and poor, to compete for increasingly mobile investment capital by lowering environmental and labor standards.
"A key MAI provision could also threaten corporate accountability laws championed by progressives in the U.S. The MAI takes aim at statutes in any nation that link subsidies, tax breaks and other public benefits to corporate behavior. This ban could be used to challenge a host of local, state and federal measures, including laws requiring subsidized firms to meet job-creation goals, community reinvestment rules that require banks to invest in underserved areas, and the 'living wage' laws that are the focus of activist campaigns across the country.
"Perhaps most disturbing, the MAI would preempt strategies for restricting corporate flight to low-wage areas --a major cause of job loss and income stagnation in the industrialized world. On top of the damage done by plant closings and layoffs, corporations use the THREAT of flight to undermine the bargaining power of unions and scare policymakers away from the tough regulation and strong public investment necessary to raise living standards. Though remote from today's policy agenda, rules limiting the capacity of corporations to flee are essential to restoring the ability of government and labor to deal with corporations on a level playing field. The MAI would bar such rules in any country that is a party to the agreement.
"In its scope and enforcement mechanisms, the MAI represents a dangerous leap over past international agreements. It grants any corporation with a regulatory gripe the right to sue a city, state or national government before an international tribunal --with a binding outcome. Governments would enjoy no reciprocal right to sue corporations on the public's behalf. And the MAI ignores most of the exceptions in previous agreements allowing governments leeway in critical areas like public health and resource conservation. The full extent of the drafters' ambitions is reflected in WTO Director General Renato Ruggerio's recent characterization of the MAI negotiations: 'We are writing the constitution of a single global economy...'"[1]
(To enlist in the fight to stop Congress from approving the MAI, contact the Public Citizen Global Trade Watch; telephone (202) 588-7777 or (202) 547-4996; or: https://www.citizen.org/pctrade/tradehome.html. You can find the full text of the MAI at that web site as well.)
In opposition to "globalization" is a growing grass-roots movement, worldwide, to assert the importance of place, to insist that the local economy, based on local materials, local skills, local capital, and local markets is the only economy that can serve the needs of people while preserving the resources that will be needed by our grandchildren. Because few places can provide all of the energy, food, water, and materials required by the local economy, it is really REGIONAL economies that are being developed. Regional trade, not global trade. The goal is to keep supply lines and transportation routes as short as possible, to keep money circulating in the local economy, and to keep the economy and local entrepreneurs (even if they are organized in the form of corporations) under some semblance of democratic control. The issue is not "corporate accountability" --a concept that does not go far enough to curb corporate abuses --the issue is democratic control of corporate behavior so that corporations serve human needs (and the needs of the environment), not merely the needs of financial elites.[2] The issue is democratic control of the local (regional) economy to serve the needs of people without wrecking the environment.
Most of the elements of this "other" economic vision would be made illegal by the MAI. As we have seen, some of the elements of this vision have already been made illegal by the GATT agreement.
Basically, it boils down to a struggle between corporate rights and human rights. Next year will be the 50th anniversary of the adoption of the Universal Declaration on Human Rights by the United Nations (and signed by the U.S. in December, 1948). (The text of the Declaration can be found at https://www.ngo.org/UDHR.html.) It is worth recalling some of the rights guaranteed to all humans --rights that are currently being eroded by grasping corporations and their "globalization" strategy:
Article 3 says "Everyone has the right to life, liberty and security." But if your environment is poisoned do you have security?
Article 16 says, "The family is the natural and fundamental group unit of society and is entitled to protection by society and the state." But how seriously is this being taken in the U.S. (or, for that matter in a country like Mexico where families are broken up as corporate-style agriculture forces people off their traditional lands)?[3]
Article 22 says, "Everyone, as a member of society, has the right to social security...."
Article 23 says, "(1) Everyone has the right to work, to free choice of employment, to just and favourable conditions of work and to protection against unemployment.
"(2) Everyone, without any discrimination, has the right to equal pay for equal work....." Women in the U.S. don't receive equal pay for equal work.
Article 25 says, "Everyone has the right to a standard of living adequate for the health and well-being of himself and of his family, including food, clothing, housing, and medical care and necessary social services, and the right to security in the event of unemployment, sickness, disability, widowhood, old age, or other lack of livelihood in circumstances beyond his control." These and other international covenants[4] need to be dusted off and brought into our struggles for an economy that works and an environment that can sustain. Internationally-recognized human rights include more than protections against arbitrary imprisonment and torture, as important as those rights are.
One organization that is seeking to rebuild regional economies, and do so within the constraints of the natural environment, is Sustainable America in New York. It's time to roll up our sleeves and take back our economy and our environment. To contact them, telephone Elaine Gross at (212) 239-4221 or E-mail them: sustamer@sanetwork.org or https://www.sanetwork.org (omit the hyphen).
More next week.
--Peter Montague
NEXT PAGE -->
|