Two Kinds of Corruption

April 22, 2012 § Leave a comment

I just finished reading two stories from today’s New York Times’ front page.  The first, an example of superb investigative reporting by David Barstow, exposes in exquisite detail how Wal-Mart became the largest employer in Mexico (209,000 employees) by systematically showering Mexican officials with millions of dollars in bribes, in violation of both Mexican and United States’ laws, and then, when top management was made aware of it, engaged in a massive effort to cover it up.  Here is a link to the story:  Wall-Mart .

Warning:  this is a long story.  I enjoyed every word because it describes how hollow the protests of “being a good corporate citizen” are when they encounter the possibility of losing money.   To whet your appetite, here is a little nugget tucked away in the midst of the Mexico story:  “In early 2005, the company went to the FBI with evidence that the disgraced former chairman, Mr. Coughlin, had embezzled hundreds of thousands of dollars.   The decision [to report criminality to law enforcement] produced months of embarrassing publicity, especially when Mr. Coughlin claimed he had used the money to pay off union spies for Wal-Mart.

The reporter opines that experience was one reason that Wal-Mart, when they learned about widespread violations of the laws of two nations by their top-level executives, decided to hide the wrongdoing rather than call the cops.

The second story describes how the American Legislative Exchange Council aka ALEC engages in vigorous and very effective lobbying of state legislative bodies and manipulates the tax code to charge a significant portion of the cost of their work to American taxpayers.  They also, like Wal-Mart, ignore state laws regulating lobbying, claiming that they are not lobbying, they are merely furnishing non-partisan  information to legislators.

Here is a link to that story:  ALEC .

If you want to know how brazen and dishonest this outfit is, here is an example:

“Last December, ALEC adopted model legislation, based on a Texas law, addressing the public disclosure of chemicals in drilling fluids used to extract natural gas through hydraulic fracturing, or fracking. The ALEC legislation, which has since provided the basis for similar bills submitted in five states, has been promoted as a victory for consumers’ right to know about potential drinking water contaminants.
A close reading of the bill, however, reveals loopholes that would allow energy companies to withhold the names of certain fluid contents, for reasons including that they have been deemed trade secrets. Most telling, perhaps, the bill was sponsored within ALEC by ExxonMobil, one of the largest practitioners of fracking — something not explained when ALEC lawmakers introduced their bills back home.”

This is “1984” meets “Animal Farm”.

Bill Seitz, a spokesman for ALEC, told the Times, “This concept that private companies are writing bills and handing them off to gullible legislators to trundle off and pass is false.”  He is probably right.  The correct adjective is not “gullible“.  It’s “vulnerable“.  The Citizens United  decision by the ” four corporate flacks plus one” in charge of the Supreme Court has empowered corporations like ExxonMobil to back up their “suggestions” about what state legislators should or should not do with the threat that, if they don’t cooperate,  well-financed, more cooperative opponents will be recruited to replace them.

My reaction to these stories is that they amount to “good news/bad news”.  The bad news is that business corporations will intuitively resort to mendacity and criminality  if the alternative is lower stock prices or smaller bonuses.  The good news is that the First Amendment is still enabling good reporters to expose them.

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