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Date: 2024-05-21 Page is: DBtxt003.php txt00023335

CORPORATE CRIME written by Russell Mokhiber
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Peter Burgess COMMENTARY added in January 2024
The author of this piece talks about his work over 36 years. I can relate to this. I have been concerned about the issue of white collar crime for almost all of my adult life and the massive hypocracy associated with the matter ... that is essentially 63 years!

I agree 100% with the theme of the following piece ... but, what to do?

My view is that a big part of the problem lies with the basic reporting that is required of corporate organizations by law in most industrialised countries. Much of the rule making goes back to the early days of the industrial revolution when massive amounts of financial capital were being modbilized in support of all sorts of industrial initiatives. Before the law established rules, entrepreneurs were free to 'lie' to potential investors about that status and prospects of their plans to the detriment of the investor. New laws were passed requiring entrepreneurs to have accountants review their company reports to investors and certify they were correct ... a 'true and fair' reflection of reality and in accordance with the 'books and records'.

This was a great improvement and the industrial revolution was in most ways, a great success.

Fast forward more than a hundred years and essentially the same reporting framework is being used in 21st century as was initiated in the 19th. It should be no surprise to anyone that corporate reporting is no longer 'fit for purpose' ... rather it has become a very powerful way for one aspect of corporate performance to dominate essentially everything. That is profit reporting to investors is all-important while all the many social and environmental matters are pushed to one side and ignored.

There have been initiatives over the years to upgrade corporate reporting such as for example John Elkington 's initiative to introduce 'Triple Bottom Line' or 3P reporting in the 1990s which attempted to expand core corporate reporting to include profit, people and planet. Though it has some success, it did not 'catch on' to become the norm for corporate reporting. Thirty plus years ago, there was interest in more comprehensive corporate reporting while there was also a bigger lobby for maintaining the status quo ... some of which was justified and some was a strong determination by many big corporate organizations to avoid responsibility for important issues of the time, many of which persist to the present day.

Over the years there has been some aspects of corporate behavior that are now the subject of external oversight, but it is not particularly well coordinated and not at all easy to navigate. I am reminded of the initiative of one company to prepare a comprehensive corporate report that was referred to as an 'environmental profit and loss account'. It did not become the prototype for other more comprehensive reporting in large part because the report for one year took three years to produce!

While it is fairly clear that the public in general would like corporate reporting to go well beyond reporting profit to shareholders (owners), it is also very clear that many big companies and powerful investors do not want this. Maybe this explains why ESG reporting has become popular. ESG reporting ... that is Environment, Society and Governance ... has become popular and gained traction at a large number of big corporate organizations. I have come to the conclusion that the reason for its popularity is that it avoids making any linkage between social impact, environmental impact and profit performance ... a mix that almost always is going to reflect badly on profit performance when there is good social and environmental performance.

A century ago using corporate accounting and reporting to stockholders as the sole framework for corporate behavior oversight was a reasonable government decision, but in the modern world, this is no longer so. Global population is about four times what it was a a hundred years ago, and the global industrial economy as measured by GDP about 10 times as much. The limits of /'sustainabiity' have been exceeded for a long time now and dangerous changes are starting to happen, not least of which are things like greenhouse gases in the atmosphere and climate change that likely will result in dangerous global warming together with ice melt and sea level rise ... and ... and ... and !

These changes may not impact old people like me so very much ... but young people, and the not so young will most likely be faced with consequential change.
Peter Burgess

What About Crime in the Suites?

Written by Russell Mokhiber in 2021 or early in 2022,

For the past thirty-six years I’ve been editing The Corporate Crime Reporter newsletter from our office in the National Press Building. But during COVID, I’ve been working mostly from home here in West Virginia, a 70/30 Trump state.

People around here have a keen understanding of street crime, from family members and the media. But pretty much they don’t have an understanding of law and order for corporations, even though they are often victims of corporate crime and violence. So let’s go back to Election Day—November 3, 2020. Our family votes at a local state park two miles away. I went and voted there, and then went fishing at the lake right next to the polling booth. And next to me also was a man fishing whom I’d never met, who had just voted for Trump, He spent about a half hour telling me about his troubles during COVID, how his dad died from working at a brake lining facility in nearby Maryland, how his nephew was hooked on opioids, how his cousin died from a cancer he believes he got from being sprayed with chemicals in Vietnam, and how he was trying to get his aunt out of a local nursing home due to, in his view, elder abuse in the nursing home.

I told him about my work on corporate crime, and that pretty much everything he just described were corporate crimes that I’ve written about over the years, beginning with my 1988 book Corporate Crime and Violence. We both sat quietly and resumed fishing. I guess we both understood that no matter who we just voted for, no one was going to take the corporate crime epidemic seriously. No matter the administration, corporate crime continues undeterred.

For example, some nursing home deaths are criminally prosecuted as reckless homicides, but very few. There never was a criminal prosecution of the chemical companies for dropping the toxic herbicide Agent Orange on Vietnam and exposing more than 4 million Vietnamese and tens of thousands of American soldiers, causing cancers, diabetes, and birth defects. Nor has an asbestos company ever been criminally prosecuted for the tens of thousands of workers exposed and sickened with the deadly asbestosis.

The opioid epidemic could have been slowed if the Justice Department had listened to its own prosecutors in 2006 and brought criminal charges against Purdue Pharma and top company executives—those federal prosecutors, working in the heart of Appalachia in West Virginia, saw the devastation that the opioid addiction was having on their own community sixteen years ago, and wrote out a 100-page memo to their supervisors at the Justice Department calling for strong criminal response to the damage.

Had they been listened to, tens of thousands of American lives could have been saved. But high-powered corporate criminal defense attorneys went over their heads and limited the range and scope of the prosecution. And if you want a nice summary of this, the New York Times put up a mini-documentary entitled “A Secret Memo that Could Have Slowed the Epidemic.”

My friends and neighbors here in West Virginia are for the most part decent, hardworking, religious people who strongly favor law and order, family, and country. A “law and order” message, “Fund the police. Crack down on crime,” resonates with them…whether the message is directed at street criminals or corporate criminals. But the criminal justice discussion in this country has been focused almost exclusively on street crime.

Here’s two examples taken from podcasts by the New York Times. Jane Kosten has one called The Argument, and she puts on these public intellectuals to discuss issues of the day. Last month she put on one titled, “Is Crime that Bad? Or Are the Vibes Just Off?” and she opened with “Republicans say Democrats are soft on crime. Democrats say Republicans are over-policing with no accountability. And what do voters think? What’s clear is that crime—or the perception of crime—is driving our political conversations.” Yet the conversation is focused almost exclusively on street crime.

There was a throwaway line by one of the panelists about “white collar crime,” which usually refers to individuals committing crimes like insider trading, often against the market or against the corporate state. But “corporate crime” should include illegality by powerful institutions themselves, committing crimes against human beings. Another example is from Ezra Klein at the New York Times, who put up a podcast recently called “Violent Crime is Spiking. Do Liberals Have an Answer?” Again, no discussion of corporate crime, even though corporate crime and violence inflicts far more damage on society than all street crime combined.

So, for example, the FBI tells us that 24,000 Americans are murdered every year. Compare that to 54,000 Americans who die every year from on-the-job occupational diseases like black lung and asbestosis, and the other tens of thousands who fall victim every year to pollution, contaminated foods, hazardous consumer products, and hospital malpractice. The FBI puts out its yearly ‘Crime in the United States” report—no talk about corporate crime. We’ve been calling for years for a “Corporate Crime in the United States” report, to no avail.

The problem is that the mainstream media and political elite focus on street crime and violence. There’s an exception from this year’s election cycle in Missouri that may show a path forward—a Democratic Senate candidate named Lucas Kunce. He’s a Democrat and 13-year veteran of Iraq and Afghanistan who’s running for the U.S. Senate. In May he wrote an opinion piece in the Joplin Globe entitled “They Are Guilty of Corporate Manslaughter. Prosecute Them.” He addressed the corporate crimes committed by the baby formula companies. In a nutshell, a whistleblower from Abbot’s Michigan plant sent the FDA a 34-page document outlining contamination and sanitary issues at the plant. The FDA sat on it for three months. By then it was too late—two babies who drank the contaminated formula had already died, and more were hospitalized.

Kunce called for breaking up the baby formula cartel, but added that “we need to prosecute Abbot, and everyone in Abbot who helped hide the unsanitary plant conditions from the FDA. They killed two babies. This is corporate manslaughter.” [He lost his August 2 primary.]

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