Corporate Culpability

[dieseltaylor]

Much noise on this one in the US? Yet again the guy at the top escapes the jail term and the company ethics are anything for a profit ..... its only a fine if we get caught.

Trafigura knew of waste dangers

BBC Newsnight has uncovered evidence revealing that oil-trading company Trafigura knew that waste dumped in Ivory Coast in 2006 was hazardous.

Trafigura had persistently denied that the waste was harmful but internal e-mails show staff knew it was hazardous.

On Wednesday, Newsnight learned that Trafigura has offered to pay damages to settle a class action brought on behalf of 31,000 who said they were injured.

Up until now Trafigura has refused to settle, denying it was to blame.

The news of the settlement came as a UN report on claims that people had fallen sick or died as a result of the dump was published.

The report says there is "strong prima facie evidence that the reported deaths and adverse health consequences are related to the dumping of the waste from the cargo ship".

The chemical waste came from a ship called Probo Koala and in August 2006 truckload after truckload of it was illegally fly-tipped at 15 locations around Abidjan, the biggest city in Ivory Coast.

In the weeks that followed the dumping, tens of thousands of people reported a range of similar symptoms, including breathing problems, sickness and diarrhoea.

Refinery by-product

The story began four years ago at an oil refinery in Mexico, owned by the state company Pemex, or PMI.

“ This is as cheap as anyone can imagine and should make serious dollars ”

Trafigura e-mail

In its chemical processes the refinery was producing a by-product - coker naptha, a dirty form of gasoline which could not be treated on site.

The e-mails which Newsnight has obtained reveal that Trafigura executives realised they could make a fortune by buying the dirty Mexican oil for next to nothing.

One e-mail says: "This is as cheap as anyone can imagine and should make serious dollars."

However, to sell it on at a profit, Trafigura first had to find a cheap way to clean the coker naptha and lower its sulphur levels.

Difficulties

Trafigura chartered the Probo Koala and while the ship was off the coast of Gibraltar poured tons of caustic soda and a catalyst into the dirty oil to clean it - a rough and ready process known as "caustic washing".

The method is cheap, but it generates such dangerous waste that it is effectively banned in most places around the world.

The e-mails obtained by Newsnight show that in the months before the waste was dumped the company knew about the difficulties they would face in disposing of the waste.

"This operation is no longer allowed in the European Union, the United States and Singapore" it is "banned in most countries due to the 'hazardous nature of the waste'", one e-mail warns.

Another e-mail points out that "environmental agencies do not allow disposal of the toxic caustic".

The process left a toxic sulphurous sludge in the tanks of the Probo Koala.

Costly process

Claiming that the waste was simply tank washings - the standard oil-water mixture produced by routine tank cleaning - Trafigura attempted to offload the waste in the Netherlands.

However, when the waste was offloaded the smell was so strong, the emergency services were called.

Samples were taken and Trafigura was told the waste was toxic and would cost hundreds of thousands of euros to treat safely.

However, Trafigura opted for the much cheaper option of reloading the waste and taking it elsewhere. It ultimately ended up in Ivory Coast.

Evidence seen by Newsnight shows that knowledge of the waste and problems getting rid of it went to the very top of Trafigura and the company's President Claude Dauphin.

The Trafigura e-mails say that Mr Dauphin was urging his team to "be creative" in how they dealt with the hazardous waste.

The contractor that they found in the end was Solomon Ugburogbu, the owner of a company called Tommy, which had no facilities to handle hazardous waste.

Ugburogbu, is now serving a 20 year sentence for poisoning local people.

Offer

Trafigura has always denied and continues to deny any liability for events that occurred in Ivory Coast.

In a statement to Newsnight on Wednesday the company said: "With regard to Trafigura's proposals for handling the treatment and disposal of the slops, Trafigura always sought to comply with the laws and regulations of the jurisdictions in which it operates."

In 2007 they paid £100m to the Ivorian government to "compensate the victims" amongst other things.

The government administered fund paid compensation to the families of 16 people whose deaths they believed were caused by the waste.

On Wednesday Trafigura admitted a "global settlement is being considered" for the victims who suffered lesser injuries.

A statement from the Ivorians' lawyers, Leigh Day and Company, confirms an offer has been made and says: "The claimants are very pleased and are keen to see the issue resolved."

Watch Newsnight's full report on Trafigura on Wednesday 16 September 2009 at 10.30pm on BBC Two, then afterwards on the BBC iPlayer and Newsnight website.

Newsnight worked in co-operation with journalists from The Guardian, Volksrant in the Netherlands, NRK in Norway and Estonian journalists in preparing this report and with access to research papers held by Greenpeace and Amnesty International.

Story from BBC NEWS:

http://news.bbc.co.uk/go/pr/fr/-/1/hi/programmes/newsnight/8259765.stm

Published: 2009/09/16 20:29:21 GMT

[Wilhammer]

Fines are so lame. The consumer ultimately pays them.

Jail term is what should happen.

[rleete]

What's wrong with a bullet or two?

[dieseltaylor]

Do you know I have no problem with that where it concerns multi-nationals who know what they are doing.

BTW you see the Mafia has been sinking radioactive waste into the Med ...

Edit just found a new faourite site!

http://www.bigassfans.com/

[Michael Emrys]

What's wrong with a bullet or two?

Or at least a daily flogging. Bring back the cat!

Michael

[gunnergoz]

I say, turn the criminals over to the locals...not the government, the real locals. Problem solved.

[Dave H]

I say, turn the criminals over to the locals...not the government, the real locals. Problem solved.

These corporate criminals are almost exactly like drug lords. They simply have so much ready cash available that they can bribe themselves out of just about any situation. They only become vulnerable like Madoff when their money disappears. When national governments return corporations to the financial risk-sharing entities they were created to be and strips away the fiction of the corporation as citizen then maybe there could be some accountability for the individuals committing the crimes.

Although I think I already explained why this will not happen with the "bribe themselves out of anything" line, AKA campaign contributions.

[gunnergoz]

I can't speak for other countries besides the USA on this, not being very conversant in their politics, but as far as the USA goes, my belief is that citizens stand to lose the republic if there is not some change in election funding laws. As it is, powerful industry, corporate and privately wealthy interests can hire experts and create "vote gathering machines" to bully, intimidate or outright mislead voters into voting one way or the other and for one candidate versus another. The only solution I can see is to make all election campaign funding totally anonymous and pooled, then equally divided up between qualified registered candidates.

[JonS]

That won't work, though, G.

Evil Corp.(inc) would, under those rules, presumably choose not to fund any particular party and have its money disappear into the anonymous pot, but instead purchase advertising directly. That would, I suppose, have the marginal effect of making it a little more obvious that Evil Corp(inc) was supporting I.M Carupt for el presidente, but given that there are a reasonable number of ads out there that are supposedly advertising something but instead just leave you scratching your head, even that tenuous link would be readily broken.

[gunnergoz]

JonS, sure it would work, if you also had regulations in effect controlling ad purchases with electoral influence objectives.

I'm not saying it is a perfect plan, but it is a damn sight better than letting special interests rule the country and dominate the voting through skillful manipulation.

[JonS]

JonS, sure it would work, if you also had regulations in effect controlling ad purchases with electoral influence objectives.

Heh. Good luck with that - "Waaa! You're infringing my right to free speech!!1!"

I'm not saying it is a perfect plan, but it is a damn sight better than letting special interests rule the country and dominate the voting through skillful manipulation.

Yep

[Michael Emrys]

...as the USA goes, my belief is that citizens stand to lose the republic if there is not some change in election funding laws.

I would say it has already been lost, and for quite some time now. For me, the only question left is can the citizens win it back.

As it is, powerful industry, corporate and privately wealthy interests can hire experts and create "vote gathering machines" to bully, intimidate or outright mislead voters into voting one way or the other and for one candidate versus another.

Yep, and that makes the "right to vote" almost meaningless. Especially when you consider the extent to which the candidates and issues have been pre-selected by those same interests.

The only solution I can see is to make all election campaign funding totally anonymous and pooled, then equally divided up between qualified registered candidates.

I would add that there should be strict ceilings on how much candidates can spend on their own media coverage and those ceilings should be low ones. A shorter campaign season, a la Canada for instance, might not be a bad idea either.

Michael

[dieseltaylor]

One hope of righting the democratic process surely is to break the incestuous cycle between Government, Big Business, and Wall St. That people are called from and return to other positions of influence means that there is not much tension between the "powers".

In France there is a strong tradition of a directive central goverment and the transfer of "knowledge" between it and business was limited. The same was true of the UK 30 years ago. The long term interests of the "State" were what the Civil Service had in mind as opposed to a business where a 5 year cycle is long term planning, and short term profit is the only interest.

Where business and Civil Service [politicos/govt] are essentially the same people working on a re-election cycle and short business cycle I think any country has problems. Witness the UK's impending power shortage as nobody thought for the longterm requirements.

AS for can the citizens win back power! Hmmm tricky. Things that spring to mind:

First past the post system is sucky in the extreme and with proportional representation within state and the choice of Senator going back to being chosen by elected members in the state legislature the power derived being photogenic, connected, and rich is weakened.

Having effectively the President as both figurehead and Prime Minister is perhaps taking the image of Republican Rome too far. Though there is no possibility of change it does seem bizarre that an already busy position of governing has the added role of being the "father figure". Most countries split the roles.

Pork barrel politics must be stamped on very heavily as this corruption is bad for public image and a corrupting process.

Abolish dynastic lines. If you are in government then no other blood relative or spouse [or-ex, widow, widower] can also be within Government or for four years. Harsh but family influence and politics ... and favours ..... does seem entrenched.

[JonS]

Do mighty oak trees grow from small acorns?

[Michael Emrys]

One hope of righting the democratic process surely is to break the incestuous cycle between Government, Big Business, and Wall St. That people are called from and return to other positions of influence means that there is not much tension between the "powers".

This one has been on my radar for quite some time now. The problem with outlawing the practice is that you do want the regulators of industries to have some practical knowledge of that which they are called on to regulate. I don't see any easy, pain-free solutions to this conundrum as long as human beings are so venal and corruptible. A part of the problem is that it became especially chic a couple or three decades back to be venal and corruptible. Remember "Meism"? Society itself—meaning the individuals who comprise it—must be willing to embrace a real ethic of service and put it into practice. I admit I haven't the foggiest of when that is going to take place.

Michael

[ASL Veteran]

Rent seeking - that's what it's called. Corporations pump money into government in order to gain a competetive advantage vs other corporations by getting regulations and laws enacted that favor said corporations. The simple and uncomplicated solution is smaller government. The smaller the government's footprint is the less of an effect the government can have on the corporate environment.

Just to clarify what I'm saying because I know this audience in here - I am not saying that there should be no government regulation on corporations. Consumer protections have to be in the mix in order to ensure the consumer gets what they thought they were getting etc. However, short of the government actually outlawing corporations and using communist economic theory to have the government make all the things the citizens want and need, the best way to reduce corporate influence in government is to reduce the size of the government. The smaller the government's footprint in the economy the less influence peddling evil corp will think it is necessary to wield in order to bend legislation and regulations to favor them.

Cap and Trade is a good example of how companies lobby and rent seek. If you are in the coal industry you want to lobby to make sure you don't get hurt too bad so you try to influence the legislation to favor you by having congress give away most of the carbon credits for free. If you are GE and you make windmills then you want to make sure that everyone is buying windmills because you are a manufacturer of windmills etc. There is a lot of material on corporate rent seeking so if anyone wants to know what's going on with the 'special interests' it's there for you to find. You just have to know what you are looking for.

The extreme example of corporate rent seeking gone wild is probably Fascism.

I've added this link from a website that leans right. There is an annoying popup asking for donations that you can't avoid but the article is a good one if you are interested in special interests.

http://spectator.org/archives/2009/09/08/from-citizens-to-stakeholders

[dieseltaylor]

I read the article - it is quite interesting. It does rather beg the question that how does a Government get things done if there is significant resistance from some important parties. Civil disobedience is quite powerful and the Govt requires a willingness from its citizens in general to be obedient for it to govern.

On specifics like the auto industry a strike by the UAW could have killed Chrysler stone dead, a strike by bondholders holding virtually worthless paper would have been laughable in its ineffectiveness. Anyone holding Chrysler paper had to be a chancer anyway as the writing has been on the wall for several years - chancers who were hoping that buying cheap paper would make them a profit on a winding up of the company.

Sorry for the digression there. You say the answer is smaller government; its funny but I have always thought smaller corporations would carry less weight - and danger to the economy when one goes tits-up. Not that I don't disagree that a less active "Government" would also be desirable. But then I would move government back towards the people and restrict central governments hold on the purse strings - as per the Swiss Government.

Are super large corporations the problem because they can sway governments? Would having all countries require that businesses within their territory require a local majority shareholding be a beneficial move? Companies could of course sell through local agents if that structure is repellent to them.

Working against centralised short-termist institutions be it govt or business would seem to be a common theme. Having national/ long term aims decided by a pure civil service may be the correct counter. Hats off to the French for the TGV and their nuclear industry both of which are highly admired these days. One of the best health care systems in the world ........

Looking at successful countries like the Nordics etc does make you wonder why they are successful whereas the WASP adverserial government systems and laissez faire economics seem inefficient in the long time spans. Long time span - I am of course talking 20 years plus : )

[ASL Veteran]

In the relationship between government and corporations the one who holds the power is the government. The reason for this is the simple fact that governments make laws and set the rules of the game by which the corporation does business. There may possibly be examples through history where a corporation was powerful enough to become a government - maybe the East India company, but for the most part the government has the power. I'm pretty sure that Exxon had oil interests in Venezuela, but Chavez didn't even bat an eyelash before basically nationalizing them (ie, stealing it). So the only thing corporations can do is to influence governments. Corporations generally don't have the legal right to make law and pass regulations. The government creates the playing field and the corporations play on the field.

Corporations also generally need credit in order to operate and that is the danger of fleecing bondholders. Sure a labor union can stop a factory from functioning but a corporation that can't get credit can be shut down just as totally. In fact, if a corporation can't get credit to operate they might even go bankrupt and disappear so the balance of power over a corporation between a labor union and a bond holder is going to depend upon the situation.

It seems like a lot of general forum readers are union members, but I have to say that here in the US anyway, the greatest danger to freedom from big government is the government employee union. In my humble opinion I don't think that government employees should be able to unionize. With a corporation at least, the group opposite the negotiating table of the union has a profit and loss motive when agreeing to a deal. What is the motivation for a government that is negotiating with a government employee labor union? The government has no profit and loss, the government just raises your taxes to cover whatever labor agreement is made so both parties aren't negotiating in faith or with any skin in the game. The end result is this http://www.cato-at-liberty.org/2009/08/24/federal-pay-continues-rapid-ascent/

The pay and mostly ridiculous retirement and benefits packages enjoyed by government employees are just part of the problem. The other part of the problem is that government employee unions create their own impetus to making government bigger. The bigger the government is the more union members the union gets and the more compensation and perks the union bosses get. Government employee unions are the biggest impediment in the US to making government smaller because they become the most powerful of interest groups or 'stakeholders' since they are operating on the inside of the corridors of power. For example, it is teacher's unions who make it impossible to reform US public schools. If the teacher's union doesn't like something then it doesn't have any chance at all of becoming law. I wish I could find it, but there was an article recently about a chicago steamroller driver who gets a retirement benefit of something like 250k per year and can even remain in his job as union boss or something (in other words he gets his salary and his retirement salary at the same time). Union bosses can be just as corrupt and greedy as any corporation, the difference being that union bosses get their perks from union dues and in many cases government deals.

I found this article - it's not the same as the one I mention above but it's basically the same thing http://www.forbes.com/forbes/2009/0216/078.html

and another article full of links http://www.americanthinker.com/2009/07/public_workers_versus_the_publ.html

[Stalins Organ]

That would be SOME Govt emplyees...in some parts of the world, at some times.....

In htese parts we have NO Govt retirement schemes any more - or at least none that are specific to the Govt outside the armed forces....which are contributory of course......the last disappeared decades ago although a few ppl held onto them because they were seriously good.

The whole of the New Zealand civil Service has just been told to expect a 5 year pay freeze....

[ASL Veteran]

That would be SOME Govt emplyees...in some parts of the world, at some times.....

In htese parts we have NO Govt retirement schemes any more - or at least none that are specific to the Govt outside the armed forces....which are contributory of course......the last disappeared decades ago although a few ppl held onto them because they were seriously good.

The whole of the New Zealand civil Service has just been told to expect a 5 year pay freeze....

Yeah, if I didn't specify I was referring to US government employees, and really the problem is probably worse at the local level than at the federal level. Most of the ridiculous retirement benefits are doled out to State and City government employees. I would have to guess that this type of situation probably does exist in other countries as well, but it really does seem like unions in the US are much more politically active / powerful than they may be in other places. However, if your media is state run (BBC) or favors big government - well you wouldn't know about crap like that because it wouldn't get reported. Like most things there has to be a balance and here in the US the unions are punching way over their weight politically considering something like only 12% of all employees in the US are union members. When Arnold Schwarzenegger became governor in California he really did want to reduce the size of the government and get control of the budget, but he was completely crushed politically by the California teacher's union. They bent Arnold over a chair and spanked him until he cried uncle. After that he lost all his mojo and basically became ineffective. There are also lots of 'commissions' for various things - I think California has more than a hundred of them - where the commission meets about one or two times a year and the commissioners get six digit salaries. Guess who gets on those commissions? Politically favored government employees usually so they can get their commissioner's salaries along with their retirement benefits.

[Stalins Organ]

However, if your media is state run (BBC) or favors big government - well you wouldn't know about crap like that because it wouldn't get reported.

rofl.....boy are you paranoid........

[JonS]

hehe - yeah. The significant difference between "State Funded" and "State Run" seems completely lost on most seppos.

Which is not to say that state broadcasters don't occasionally, er, 'overlook' dubious behaviour by the govt of the day. However, it does highlight one of the significant advantages of having a constitutional monarchy and an unelected HOS. Liz's politics are irrelevant, and all civil servants (and members of the armed forces, and others such as state broadcasters) owe their alleigance to Her alone, not some dude who managed to convince most of the people that he's a good bet for the next 3 or 4 years.

[ASL Veteran]

rofl.....boy are you paranoid........

No, not paranoid. I'm realistic. There is no such thing as unbiased media. The simple fact for that is because articles aren't written by robots and if they were they probably wouldn't be fun to read anyway . A media outlet has a structure to it and the content is going to be controlled by somebody - typically a set of editors. With media like the New York Times, the New York Post, or the Wall Street Journal what you read is going to be what the editors of those media outlets want you to read. Even straightforward news articles can have a slant to it although there the bias is harder to detect. The main problem with detecting media bias is whether you are predisposed to agree with what the media outlet is saying or not. If the media outlet is reinforcing something you believe to be true then you won't detect the bias. If the media outlet is telling you something that you disagree with then you will be able to detect the bias more easily.

The tricky part is why you believe in something. Do you believe in what you are being presented simply because that media outlet is telling you it's true or do you believe in what you are being presented because you have thought through what you are being shown and decided that it makes sense? What I do is I have a set of beliefs, values, and knowledge of how things work that I have acquired simply through living life and experiencing things. My main objection to larger government is rooted in the fact that I don't want to pay any more taxes than I have to. I want to keep my money and do with it what I want to do with it. For me if someone - say Obama - is proposing some massive new federal spending program then I'm going to resist it unless I can be convinced that what is being offered is better than what I have now and won't force me to give up more of my income through taxation. I also know through my own education that there are other ways of tackling the health care issue than what is being proposed - ways that could have a huge impact and cost the taxpayer nothing. I studied ERISA in college - here is a good article on ERISA's role in US healthcare http://spectator.org/archives/2009/09/09/solving-healthcare-through-ver

I don't post that link to start a discussion about healthcare but to show that my resistance to Obama's proposal is based on things that I believe in and things I have experienced or learned through the simple act of being alive and aware. Really - does anyone think he can wave a magic wand and eliminate 500 billion in "waste fraud and abuse" out of Medicare? That doesn't even pass the laugh test. Besides, if he could why doesn't he just do it - there would be no need to pass a huge health care bill to get that done.

Probably one of the best places to align your biases is this site here http://www.realclearpolitics.com/?state=noad

You will get a full spectrum of viewpoints on any issue on this site and you should be able to quickly detect which way different media outlets lean. Just for fun though let's do a more focused exercise - say on Global Warming. It's pretty well known that Prince Charles is a huge advocate of Global Warming. If we assume that the Royal Family is involved in appointing or perhaps approving through influence (I don't know how it works) those who decide what content will appear on the BBC then you would expect the BBC to be pro global warming in it's outlook. Do a search on BBC for Global Warming and you get this http://search.bbc.co.uk/search?uri=%2F&scope=all&go=toolbar&q=global+warming

Now if you are predisposed to believe that Global Warming is a fact then the BBC is going to reinforce your views. I think it's probably safe to assume that few, if any, people on this forum actually know the science behind 'climate change' or are a climate scientist themselves. We all rely upon experts to give us their views on the matter which we can either believe or not. If all you are getting is one side of the story though - well then that media outlet is attempting to influence you into thinking a certain way. How many articles on the BBC can you find that disputes Global Warming? I didn't see any but I only checked the first five pages of the search results. Now compare the BBC search results to search results from the American Thinker http://www.americanthinker.com/search/?cx=016417505616455789357%3Amttpazkfree&cof=FORID%3A9&ie=UTF-8&q=global+warming&sa=Search#915

You are obviously getting a different slant on things at American Thinker than you would by reading the BBC. So to get to my previous point which was quoted by Stalinist Organist - the BBC is covering Global Warming in a manner that the Prince of Wales would be proud of and probably approves of. If the BBC is the only outlet that you get your news from then the fact that there are plenty of climate scientists who disagree with Prince Charle's version of Global Warming has been "Omitted" from their reporting.

I also want to reinforce that I'm not really interested in discussing health care or global warming. I'm just using those as examples in my discussion of media bias.

[dieseltaylor]

ASL - you raise an interesting point about bias which I fully accept.

It is interesting that one of the problems I have with the BBC is that it is prone to print good stories about computer gaming whenever there is adverse reports as though digital proficiency outweighs violent tendencies encouraged through gaming. It takes a view that it is responsible for providing a balanced view ..... however the weight of an articles is not effectively displayed if any critical comment is countered by a positive also associated with computing no matter if it is frivlous.

Fortunately the BBC does occassionally get off the fence - climate change would be a good example. Arguably this may be a response to the fact that they are reporting on government actions around the world, green actions by companies etc. And it is entirely possible that the fact that all the major science organisations in the Western world - and possibly the Eastern are all in agreement on the matter.

Now it is interesting to think maverick scientists should be given an equal shout ..... but at some point you have to realise that like holocaust deniers and flat-earthers that really they do not need any further hearing. So when you say plenty of scientists disagree with climate warming ...... do they amount to a significant figure or are they the misguided crackpots of any profession.

No science is 100% proven but sometimes the consensus view has to be accepted by the Governments of the countries concerned as to await a 100% agreement of all scientists would be absurd.