"The Movement(s)"
Anti-Corporate Globalization Coverage from Inner City Press -- On To Questioning the IFIs 2005-2006
[Editor's note: here, Inner City Press covers the emerging movement(s) opposing, or seeking to make more transparent and accountable, corporate-driven globalization. Our other Reporters cover Community Reinvestment, Environmental Justice, the Federal Reserve, "Global Inner Cities" (more newsy, less movement-focused) and other beats. Click here to Search This Site ]
ICP has just published a (double) book about the movement-relevant topics of subprime lending, and corporate fraud - click here for sample chapters, here for fast ordering and delivery, and here for other ordering information. CBS MarketWatch of April 23, 2004, says the the novel has "some very funny moments," and that the non-fiction mixes "global statistics and first-person accounts." The Washington Post of March 15, 2004, calls Predatory Bender: America in the Aughts "the first novel about predatory lending;" the London Times of April 15, 2004, "A Novel Approach," said it "has a cast of colorful characters." See also, "City Lit: Roman a Klepto [Review of ‘Predatory Bender’]," by Matt Pacenza, City Limits, Sept.-Oct. 2004. The Pittsburgh City Paper says the 100-page afterword makes the "indispensable point that predatory lending is now being aggressively exported to the rest of the globe." Click here for that review; click here to Search This Site
November 7, 2005
Citigroup bragged last week of its
hiring of ex-World Banker James Wolfensohn, to add to a roster already including Robert
Rubin, who has still done nothing to address CitiFinancial’s predatory lending (and
took no public position on Citi’s super high cost HOEPA loans in 2004, leaving that
task to the now-gone Bob Willumstad). As noted
by the FT, “the announcement came just a day after the world's biggest financial
services group said it had hired Shengman Zhang, Mr. Wolfensohn's former number two at the
World Bank, to be chairman of its public sector group.”
Here’s a thought: why doesn’t the World Bank have anti-revolving
door policies, as even the U.S. bank regulators have had to adopt?
Some previous reports:
November 29, 2004
And we’re
back. Hitting a new low, in last week’s Bloomberg
News article about the funding of payday
loans and lenders (“JPMorgan, Banks Back Lenders
Luring Poor With 780 Percent Rates,” Nov. 23), JPM Chase spokeswoman Calmetta Coleman is quoted that “the bank will continue
extending credit to payday lenders. In June, JPMorgan donated $400,000 to the National
Federation of Community Development Credit Unions to research alternative ways to make
short-term loans to the poor. ‘We have heard the concerns of consumer groups,'
Coleman says.” The article identified
Morgan Chase as providing “credit to ACE Cash Express Inc. of Irving, Texas; Mr.
Payday of Kentucky Inc.; and Illinois Payday Loans Inc., among others, according to
Uniform Commercial Code records, which show lending relationships” -- the UCC filings
ICP unearthed and raised in early 2004, including at the Federal
Reserve’s Morgan Chase-Bank One hearings
September 1, 2004:
Bronx-view of RNC (March on the Media)
Who will tell the people? Some of those
whose answer is “Not the mainstream media” held a march on September 1,
down the canyon of Sixth Avenue from 52nd to 48th Street. It took at
least two hours to move those four blocks: the marchers were penned in by blue wooden and
gray metal barricades, and phalanxes of police with white plastic handcuffs encircled the
pen at all times. They made it difficult for
people wanting to join the demonstration to do so. A
man who looked like a shorter Donald Sutherland was directed to try from 50th
Street, then returned and said he could. Police
Officer Mike Galgano of the Manhattan South Task Force, shield 2671, escorted Donnie
Sutherland into the pen, but then continued to misdirect others who asked up to 51st
Street, or among the same fruitless 50th Street path. P.O. Galgano’s white-shirted colleague
Heaney snuck a smoke -- Salem Light -- while saying he’d have to quit again tomorrow.
Each day of the RNC another nail in the coffin.
On 52nd
Street, Dick Cheney spoke from a huge television screen by the Hilton Hotel. [Click here for Inner City Press' report of
last week on link between Cheney's Halliburton and Deutsche Bank -- on the boards
of directors of both Halliburton and predatory lending-supporter Deutsche Bank is one W.R. Howell, not
of Gilligan's Island but J.C. Penney, per www.halliburton.com/about/board_of_dir.jsp
... We sketch these connections, but must still reflect on
what they do to stop Bronxites from being sacrificed to both parties' ideologies, in Iraq
and elsewhere, see below.] On 50th, the marquee advertised a New York
Liberty basketball game for the following night. Whole
lanes of Sixth Avenue were coned-off for charter busses, which whizzed through with
darkened windows. With the lights of Radio City behind it, one saw there were only three
delegates in the bus, peering out at the hand-made signs -- Re-feat Bush, Pink Slip Bush
-- and the green-hatted legal observers. The
chants ranged from “Whose media? Our media!” to “We aren’t
buying!” Slipping through all obstacles were food delivery men on bikes, leaving a
fragrant jet-stream in their wake. Less fragrant was the exhaust of the M7 bus, headed up
to Harlem
More
seriously, the marchers were energetic and nearly entirely white. That may be a reflection
of the current demographics of the “independent media movement,” or at least
this midtown Manhattan wing of the movement. It doesn’t make the argument -- for each
Fox lie, people die, for example -- invalid. But it’s worth reflecting on, as is the
disconnection between the protests to the RNC and, for example, The Bronx. Some articles this week have mentioned The Bronx,
as a symbol of poverty; some delegates took dark-windowed busses to the Bronx Zoo. But The
Bronx is not just a symbol: there are 1,300,000 people living here, most of whom
don’t vote. Those elected by those who do
vote seem predisposed to steal. The main nexus between the issues raised at the
conventions, both of them, and The Bronx is providing soldiers, including to die.
And who will tell the people?
April 26, 2004
It's a once-a-year event, and we've covered it in the space before, and so now this update, on the Citigroup's shareholders' meeting held April 20, 2004, at Carnegie Hall. Onstage was a table with three seats: Weill, Prince and Willumstad. Behind them a screen, on which a video would later be played. Weill began the meeting comparing Citi's performance to AIG, Berkshire Hathaway and GE. "If you have personal business," he said, "representatives of Smith Barney and others are in the back of the hall." Then he endeavored to move quickly through the agenda, almost closing discussion on Agenda Item One (election of directors) before any questions could be asked.
The issue of directors had been big, in the run-up to the meeting, with even the New York Post running a headline, CAL-PERSONAL, reporting that Calpers would vote against Weill and Prince, the latter for conflict of interest. But there was very little debate at the meeting itself. ICP finally asked a question -- Weill demanded to know if it would relate to directors, it did: why should those who ran Commercial Credit and CitiFinancial, leading into the predatory lending settlement with the FTC, continue on the board? Why has director Robert Rubin claimed that this controversial subprime prime lending is not under his "aegis"? (See ICP's ongoing CitiWatch Report and word search "aegis," we did). Why does CitiFinancial have not even purported "best practices," outside the U.S.? Weill asked Willumstad to answer; Willumstad said that he didn’t agree, that "we have retooled to the standards of our critics," then claimed that CitiFinancial has the same practices outside the U.S. as within. ICP asked, where do you suggest we go with the inconsistencies? Weill responded, Willumstad, and asked Rubin (seated in the front row) if he'd heard about aegis. We'll see.
What was most troubling and merits mention on this page was the lack of any environmental questioning at the meeting. A person from a religious order's pension fund praised Weill and the company extensively, with no mention of the more recent backsliding on even the Equator Principles, which has been reported in the Financial Times. There's a need for follow-up; it shouldn't be this easy (that's our view).
A union presented a proposal that Citigroup at least better disclose its political campaign contributions; ICP supported it, noting Citi's lobbying against anti-predatory lending laws at the state and local levels. A video was shown, of Citi's $200 million financial education program, with talking head shots of all three on stage, only this time in a windowed office over Park Avenue. Rubin and Marge Magner were also interviewed. Among the project profiled was one in which a Russian banker -- to know who, we'll need the video of the meeting -- expressed gratitude for having been flown to the U.S. and put up for four weeks. Then it was open mike time, and time for another question: is flying for-profit Russian bankers around part of the financial education program? Prince deadpanned: if it's in the video, it's in the program. Okay then -- any reaction to JP Morgan Chase's $800 billion pledge, and BofA's $750 billion? Willumstad responded that those were done in the context of mergers, and that in Citi's last merger, Golden State, $175 billion was committed to those Golden states (Cali and Nevada). He said while Citi's number one or two in subprime, it's number five in prime mortgages. ICP's subprime question -- whether the financial education is tied in any way to the relatively lower income customers to whom CitiFinancial is directed -- was answered by Prince, who said "we accept that we need to be leaders... as noted, we were all at Commercial Credit since 1986," and more -- we'll need the tape. An ex-Primerica employee presented a symphony for the company (very surreal, that) -- Weill joked that the man had made it to Carnegie Hall with his music. It was very magnanimous, it was very self-satisfied, it was the world's largest bank, praising itself, in a concert hall named for a robber baron... There's a need for follow-up; it shouldn't be this easy (that's our view). For a CBS MarketWatch article on these issues, click here. For or with more information, contact us. Jumping back --
July 7, 2003
The Supreme Court punted on the Nike case, which raised the question of when and how court can compare a corporation's claims to its actual practices. Last week ICP's Fair Finance Watch raised a somewhat similar question to the Federal Reserve Board, with regard to a bank, Crédit Agricole ("CA"). CA recently acquired Crédit Lyonnais, in the largest European bank merger since Royal Bank of Scotland's take-over of NatWest. The combined CA claims to have human rights and environmental standards, but refuses to answer questions about these standards, or about the CRA and mortgage lending record of a bank it owns in the U.S. So on July 3, in the spirit of independence, ICP/FFW raised these issues to the Fed, in "a timely comment opposing the Applications of SAS Rue la Boetie, through Credit Agricole, to acquire control of Espirito Santo Bank." [For community lending issues, see this week's ICP CRA Report.]
Regarding Espirito Santo Bank, we hereby timely bring to the FRB's attention the report earlier this year in the Miami Daily Business Review (February 5, 2003) that
"[a]lmost $1.2 million in 'secret commissions' from the sale of military aircraft and equipment is said to have been deposited in Miami's Espirito Santo Bank on Brickell Avenue. A long-playing corruption scandal that rocked NATO and the governments of Belgium and Chile in the 1990s - featuring the suicide of a Belgian general and millions in payments to a mysterious arms dealer tied to former Chilean dictator Augusto Pinochet - now is following a money trail into Miami. According to papers filed in U.S. District Court in Miami, a Belgian prosecutor has asked the U.S. attorney's office to obtain records from Miami's Espirito Santo Bank about an account in which nearly $1.2 million in "secret commissions" from the sale of military aircraft and equipment was deposited. The prosecutor wants to determine the identity of the beneficiary of that account, No. 116154103... That money is part of $14.5 million in under-the-table commissions allegedly paid on behalf of Berthier Investments Inc. from money that originated as Chilean government funds. The "beneficiary" of Berthier Investments, a British Virgin Islands firm with a Miami post office box, is a Chilean arms dealer of Czech origin named Carlos Honzik, according to court papers. The papers indicate that Honzik, a reputed friend of Pinochet, is now dead."
We further note the report in the London newspaper The Guardian, of October 11, 2001, which reported that Credit Agricole had handled $92,000,000 for Nigerian ex-dictator Sani Abacha, raising a red flag of a lack of human rights standards and, relatedly, a lack of anti-money laundering safeguards. As yet one more example, we note that Crédit Lyonnais (of which we understand Crédit Agricole now owns over 97%) was, at least less than two years ago, a funder of the questioned Chad-Cameroon oil pipeline project...For or with more information, contact us.
June 30, 2003
This week: a telling omission, a representative spin. The former comes from summer meeting of the (U.S.) National Association of Insurance Commissioners, held in New York on June 21-24. It cost six hundred dollars. Inner City Press / Fair Finance Watch attended, but did not pay. Rather, an ICP representative made a presentation to the NAIC / Consumer Liaison committee. Then ICP attended a meeting of NAIC's International Insurance Relations committee. The chair of the committee, District of Columbia insurance commissioner Larry Mirel, repeated invited "the industry" to make suggestions, and to participate in the Working Group's conference calls. ICP intervened, saying it's important that not only the industry, but also consumer organizations -- that is, civil society -- be allowed to participate. "But of course," the chair responded, promising that ICP will be informed of upcoming proceedings of the committee. We'll see. Meanwhile, the representative of the insurance company AIG participates extensively in the committee; AIG and its peers appear to dominate the NAIC...
Industry's spin on the Supreme Court's Nike non-decision last week is exemplified here. The article quotes the principal of the aptly-named Corporate Storyteller: "How should U.S. companies behave as a result of (Thursday’s) announcement? They should be careful. They should continue to feel free to speak out on issues, but they should take great care to ensure the truthfulness of their statements that are matters of fact." Devil-may-care is Citigroup's claims that CitiFinancial is not a predatory lending -- click here for more on that...
June 23, 2003
ICP's Fair Finance Watch has challenged Royal Bank of Scotland's proposals to acquire Port Financial in the U.S., and Churchill Insurance in the U.K.. On the human rights and environmental issues that ICP raised, RBS begins by claiming to be "pleased to respond to ICP's human rights allegations." Thereafter it dodges the issues. For example, after dismissively referring to ICP's presentation of the "business practices of Asia Pulp & Paper Co. Ltd ('APP')," RBS then states that "RBSG is aware of contradictory press reports asserting that APP complies with international environmental conservation standards and has an established reforestation program." None of these "contradictory press reports" are provided or even cited to. RBS brags that it was listed (at the last minute, ICP might add) among the signers of the so-called Equator Principles. Resp. at 24. RBS's actual practices are what concern ICP -- and dodgy answers, and refusal to answer basic questions such as which subprime lenders GCM does business with, lead ICP to redouble its efforts on this campaign. For more, see this week's ICP CRA Report.
June 16, 2003
In the run-up to the EU summit in northern Greece June 20-21, some 10,000 policemen are being deployed, a senior police source said last week. The force will be shared out between the port town of Salonika, which will be the backwater venue for the bulk of the demonstrations, and the summit's HQ at the resort of Neos Marmaras, some 150 kilometres (90 miles) to the southeast. Some 6,000 police will travel to Salonika and Neos Marmaras from other parts of Greece, including 1,200 anti-riot police and 1,200 police academy students. The security forces' operational plan for the summit was examined Monday by Greek Prime Minister Costas Simitis and Public Order Minister Michalis Chrysochoidis. How this strategy of "distancing," most recently deployed in on the French-Swiss border, works remains to be seen...
June 9, 2003
On June 4, Citigroup and nine other global banks announced reforms to their project finance lending, adopting a vague set of "Equator Principles" -- the World Bank offered praise; environmental organizations put forth a mix of praise and critique. Citigroup's Chuck Prince said-in-statement that the Principles are "a major step forward by the financial sector to address the environmental and social issues that arise from development projects."
We can't help noting that this is the same Citigroup (and the same Prince) long refusing to adopt any standards regarding which high interest rate loans they buy, securitize or otherwise enable. When the issue was raised, Mr. Prince said that Citi was akin to a pipe or a wire, through which the loans flowed. Strange, then, that Citi would so loudly claim to be considering the environmental impact of its project finance loans.
Also strange is the inclusion of Royal Bank of Scotland on the list. They almost didn't sign, then did. But they deny any responsibility over the social effects of loans RBS' Greenwich Capital Markets makes to questionable subprime consumer finance lenders...
Ah, globalization. On June 4, Goldman Sachs issued a press release bragging that it has signed a deal with Industrial and Commercial Bank of China to "dispose" of up to $1.2 billion in bad loans, the first such direct agreement with a Chinese bank. Goldman's CEO Henry Paulson said, "We hope this is the beginning of a long-term relationship between our two firms." We hope not...
June 2, 2003
While the G-8 protests were kept 25 miles away from the summit site, we focus this week on... Royal Bank of Scotland. In July 2001, FTSE International, jointly owned by the Financial Times and the London Stock Exchange, created a "FTSE4Good Index" -- which listed Royal Bank of Scotland as an unethical investment. See, e.g., Belfast News Letter of July 17, 2001. The U.K.'s Financial News of July 16, 2001 reported that "Royal Bank of Scotland does not have a human rights policy for its operation in Indonesia, so it has been excluded." The Herald of Glasgow (July 11, 2001, Royal Bank Fails to Make Ethics List) reports that RBS "has been excluded from the new FTSE4Good ethical investment index because it failed to develop a policy towards human rights in Indonesia, where it is a significant lender."
RBS lobbied hard, and got included in the index in September 2001. But there has been no disclosure -- certainly there is none in the application -- of any human rights related standards at RBS. RBS continues to be invested in Indonesia (having, as simply only example, a 90 percent stake in Indonesia's Multicor Bank, at least as of March 2003). [For the record, last week the Indonesian human rights organization Kontras (Commission for the Disappeared and Victims of Violence) was attacked, and not protected by authorities, reportedly due to Kontras' monitoring of the situation in Aceh.] Note also that RBS' Natwest is embroiled in a human rights-related controversy over its sponsorship of a cricket tour that is going forward in Zimbabwe -- the imbroglio again shows that RBS does not have human rights related standards.
Nor does it have environmental standards: environmentalists have "launched campaigns against Natwest -- owned by Royal Bank of Scotland Group.. for financing de-foresting in Indonesia." AFX European Focus, July 10, 2001. The Guardian (London) of July 26, 2001 (Rainforests Hit by Paper Trail to UK) reports that "Cheap paper made from cutting down Indonesian rainforest, an industry which is endangering some of the world's rarest animals, is flooding into Britain... APP [Asia Pulp and Paper], Indonesia's biggest pulp and paper producer, and some of its subsidiaries have received considerable financial backing from British banks, including NatWest. Conservationists say Indonesia is heading for an environmental disaster. It is estimated the country has lost more than 70% of its forests. A report by the World Bank has warned that 2m hectares - an area the size of Belgium - is being cut down every year and there are fears that by 2020 all of Indonesia's forests could have been destroyed." For the reasons set forth above, ICP and FFW have requested hearings...
May 26, 2003
The Swiss press estimates that 30,000 and 40,000 people will take part on June 1 in a demonstration to coincide with the G8 summit in Evian-les-Bains, France. The alternative summit will be held in Annemasse during May 29-31; the march will take place between Annemasse and Geneva. After a meeting with French Interior Minister Nicolas Sarkozy, Amnesty International's Antoine Fobe said, of legal observers to monitor the conduct of police and of the judicial and administrative authorities during demonstrations. "Mr Sarkozy thinks this information role is 'normal and welcome.'"
May 19, 2003
News we were glad to see: the announcement by China's Shenzhen Development Bank, on May 12, that it has dissolved a management team led by potential investor Newbridge Capital, ending the U.S. fund's unprecedented control over the mid-sized listed lender. Analysts said the shock news effectively doomed the equity fund's ambition to buy what would have been the largest slice of a Chinese bank ever taken by a outside company. Chomping at the bit are Citigroup and HSBC... Meanwhile the insurance company AIG is still, according to its web site, doing business in Zimbabwe. In fact, AIG is offering "political risk" insurance there...
May 5, 2003
Environmentalists and human rights groups assert that in Bangladesh the cultivation of prawns is associated with rampant corruption, illegal land occupation and brutal attacks on those resisting the industry's rapid expansion, and that at least 150 people have been killed and thousands injured in clashes linked to prawn production. Traditional farmers in Bangladesh's coastal regions have seen their land illegally occupied and flooded with saltwater - destroying crops and killing livestock - to make way for prawn production. Resistance has been met with intimidation, violent attacks and even murder. The Bangladeshi government has helped establish processing plants to prepare prawns for export.
We'd say: watch for litigation, under the Alien Tort Claims Act or otherwise...
April 28, 2003
In connection with Inner City Press' just-launched GE Watch, we offer this update on GE's continuing involvement with the controversial (human rights violation-tarnished) Dabhol power project in Maharashtra state, India. This was 65% owned by Enron (and 10% owned by GE); studies have detailed how these owners collaborated in violation of rights of project opponents. Now, General Electric states, along with Bechtel, that it will acquire the 65 percent stake held by the US Overseas Promotion Investment Corporation in Dabhol Power Company $ 20 million). They have signed a Memorandum of Understanding with OPIC to this effect. The MOU will be valid till Mar 2004. The two companies have approached the Government of India for a sovereign guarantee to acquire the stake... See also ICP's Environmental Justice report this week, regarding GE's attacks on the US Superfund clean-up law...
April 21, 2003
Hina Jilani, the U.N. Secretary General's special rapporteur for human rights defenders, spoke last week of a "conspiracy between the state and private sector corporations," in connection with state reactions to protests against private sector policies, whether for violations of the right to a clean environment or for the direction that development policies are heading. Well all right...
April 14, 2003
On the question of individual's liability for human rights crimes, we became aware last week of a web site which streams the days' proceedings from the International Criminal Tribunal on the Former Yugoslavia: it's http://hague.bard.edu . We also suggest http://www.freemikehawash.org/oldindex.html
April 7, 2003
Corporate globalization in a nutshell: South Korea will inject 800 billion won ($640 million) into Korea First Bank this year, under a deal to cover losses after the bank's sale to U.S. fund Newbridge Capital, the Chosun Ilbo newspaper reported last week. The funds to be provided by the Korea Deposit Insurance Corp, a state-run restructuring agency, will be on top of 17.1 trillion won of taxpayers' money injected so far into Korea First Bank, the newspaper said, citing an official at the state-run agency.... Also: apparel company Phillips-Van Heusen, for example, hired Kroll to review security at its overseas operations. The maker of shirts and shoes buys products from four assembly plants or maquilas in San Pedro Sula, Honduras and pays Crowley American Transport to move the goods from the plant to the United States. Employees are frisked at the beginning and end of the workday. Because of frequent hijackings, trucks travel in convoys of four and five from San Pedro Sula to the port of Puerto Cortes with a private security escort trailing behind. Containers have locks on them...
March 31, 2003
In Geneva on March 30, several thousand demonstrators gathered outside the headquarters of the World Trade Organization on Saturday to protest both militarization and the WTO. Turning their backs to the WTO building which was surrounded by police, they marched towards the UN's European headquarters and into the city center. They denounced the liberalization of water and other public services... Click here for HSBC - Household wrap-up (for now).
March 24, 2003
Absurdist quote of the week, from ex-WTO chief Michael Moore's new book, "World Without Walls" -- critics "assail the World Bank, accusing it of causing world poverty. Which is like accusing the Red Cross Society of causing world wars." But he also quotes a report by the United Nations Development Program, which states that in sub-Saharan Africa, per capita income was around one-ninth of that in Organization for Economic Cooperation and Development countries in 1960 and had deteriorated to around one-eighteenth by 1998...
This, we must say: the agreement by U.S.-based television stations to refrain from showing the footage of captured American soldiers that was shown throughout the rest of the world was shameful. The argument was that the U.S. POWs were being "paraded." How the footage was different from that of captured / conceding Iraqi soldiers has not been explained. What happened to freedom of the press?
March 17, 2003
Today in Mexico begins the "last round" of talks for the proposed Free Trade Area of the Americas. Through late 2004, trade ministers, deputy ministers and delegates from 34 countries will serially negotiate in a building that was built especially for the negotiations in Puebla. The negotiators will have to address complaints by Brazil and Venezuela of advantages enjoyed by the United States in the negotiations, as well as protests. The trade questions that have given rise to most disputes between countries in the Americas, such as farm subsidies and non-tariff trade barriers, will not however be dealt with by the FTAA negotiators. Those will be left to the WTO, and the FTAA will merely incorporate the international agreements reached within the framework of the global trade forum, it's said...
March 10, 2003
A real politik view of the "globalization" issues, from the Tajik newspaper Biznes i Politika: "The Central Asian region [will] turn into a scene of fierce geopolitical competition between the USA, Russia, China, Pakistan, Turkey and Iran. As the process of the British-American globalization is running counter to the interests of Russia, China, Iran and Pakistan in the region, they will stake on the forces which strive to resist this process in Central Asia, that is to say, on antiglobalists in the person of the pro-Russian, pro-Chinese and Islamic political elite. The USA and its allies will seek support amongst regional pro-American forces, or the so-called globalists. This geopolitical competition for the sphere of influence in Central Asia may destabilize the sociopolitical situation in the region."
March 3, 2003
According to the UNCTAD's World Investment Report 2002, as in the past, FDI flows to the developing world remain unevenly distributed. In 2001, the 49 Least Developed Countries (LDCs) remained marginal recipients, with only 2 per cent of all FDI to developing countries or 0.5 per cent of the global total. The five largest recipients attracted 62 per cent of the total inflows to developing countries. In terms of regions, Africa remained a marginal recipient of FDI with a substantial concentration of the flows to South Africa and Morocco. Further, the FDI flows to Africa have been narrowly concentrated in the primary sector
In other African news (!), ICP's Fair Finance Watch received the following sample response last week:
Subj: Predatory lending in Kenya via takeover by HSBC of Equator Bank
Date: 2/28/03 1:40:48 AM Eastern Standard Time
To: [ICP / Fair Finance Watch]
We refer to your email of 23 February 2003 addressed to our Mr. J.K. Murugu
on the above subject. We appreciate the trouble you took to put the long dossier together and will take full cognizance of your warning about the practice of predatory lending. Than you very much for your warning.
Patrick N. Ndwiga, Manager, Bank Supervision
CENTRAL BANK OF KENYA
You're welcome; more such warnings / alerts will be forthcoming. For or with more information, contact us.
February 24, 2003
From New Zealand, a sort-of debriefing of ex-WTO chief Michael Moore: "He wants engagement - 'we need constructive critics' - Moore backs calls for 'corporate social responsibility' - both on moral grounds and to build trust. 'While global brands command immense trust, the companies that create and build them do not. The challenge for corporates is to leverage the power of their brands for socially positive outcomes.' Why should they bother? It is easier for multinationals to twist governments' arms for privileges and protection than to win the public debate. And apologists insist they have a narrow financial duty to shareholders. But, says Moore, such myopia only adds power to anti-globalizers' elbow and damages trust, which in the long run is bad for profits." He's a real deep thinker, that Mike Moore...
ICP's Fair Finance Watch is "on the road" -- see our Global Inner Cities report for comments we've just filed in a dozen African nations, opposing HSBC's proposals there, including the "export" of Household's practices, and an acquisition of 40% of the shares of Equator Bank.
February 17, 2003: More on Mizuho: here is a portion of ICP's Feb. 17 comment to Japan's FSA:
...ICP is hereby asking the FSA to request, obtain and make public Mizuho's Feb. 13 CRA submission to the FRB. On Feb. 5, ICP submitted a comment to the FRB. On Feb. 10, the FRB posed questions to Mizuho, asking for a response by Feb. 14. ICP anticipated that it would receive its copy of Mizuho's response, and be able to comment thereon in this submission to the FSA. As set forth below, Mizuho is for some reason trying to keep confidential all substantive portions of its response, on CRA relevant issues -- the FSA should obtain Mizuho's response, and ICP is hereby formally requesting to be provided with a copy thereof. Here were the FRB's Feb. 10 questions to Mizuho [see Update of February 11, 2002, below.]
To complete the record on this application, please provide the following information (with supporting documentation, as appropriate).
1. For the period covering January 1, 2001, through December 31, 2002, please provide separately, for each calendar year, the number and dollar volume of the community development lending and qualified investment activity of Mizuho Corporate Bank (USA), New York, New York (formerly, Fuji Bank and Trust Company). Include the activity of IBJ Whitehall Bank and Trust Company, New York, New York, and Industrial Bank of Japan Trust Company, New York, New York, prior to these institutions' subsequent merger into Fuji Bank and Trust Company. In addition, provide details describing the qualified loans and investments.
2. Please provide the number and dollar volume of loans to small businesses (i.e., loans to businesses with revenues of $1 million or less) and loans to small businesses located in low- and moderate-income census tracts extended by Mizuho Corporate Bank of California, Los Angeles, California, during calendar year 2002. Provide the information for the institution in its combined assessment areas, and separately, in each of its two assessment areas (i.e., Los Angeles and Santa Clara).
3. Footnote number four on page thirty-three of the application notes that Mizuho Trust and Banking Co. (USA), New York, New York ("MTBC-USA"), suspended its Community Reinvestment Act ("CRA") activities "for part of 1999 and 2000 in conjunction with a plan to convert its status to that of a limited purpose trust company." Please elaborate on that statement. Identify the CRA activities that were ceased during the period referenced and explain why such activities were discontinued. In addition, explain why MTBC-USA abandoned its plan to become a limited purpose trust company. Please provide the number and dollar volume of MTBC-USA's community development lending, qualified investment, and any other significant CRA-related activity(ies) since its last examination by a federal supervisory agency. Provide these totals separately for each year and provide details describing the qualified loans and investments.
4. Please discuss the status of the applications that Mizuho has submitted in connection with the proposal with New York, California, Georgia, and Japan's Financial Services Authority.
To facilitate timely processing of the application, provide six copies of the requested information... by no later than February 14, 2003. If Mizuho should desire confidential treatment for any portion of its response, it should request such treatment... In addition, please send a copy of the non-confidential portion of the your response to [ICP].
Sincerely
[Helen M. Troy for]
Shawn McNulty, Associate Director
ICP anticipated receiving its copy of Mizuho's response and being able to comment thereon in this submission to the FSA. However, on Feb. 14 ICP received from Mizuho's counsel a letter which confines virtually all of the substantive portions of Mizuho's response to purportedly "Confidential" exhibits (numbered 36-40). In response to above-quoted Question 1, Mizuho refers to "Confidential" Exhibits 36, 37, and 38. To Question 2, Mizuho refers to "Confidential" Exhibit 39; to Question 3, Mizuho refers to "Confidential" Exhibit 40. Then, in response to Question 4, Mizuho states inter alia that the FSA and other agencies have received all of the necessary information to consider the applications.
It is unclear to ICP if the FSA has yet received a copy of Mizuho's response(s) on these issues. The FSA should obtain, and provide the public and ICP with copies of these relevant exhibits. On the current record, Mizuho's applications to the FSA should not be approved.
We will report on the FSA's (and Mizuho's) responses, upon receipt. For or with more information, contact us.
February 10, 2003
While we've focused to date on the mega-banks based in the U.S. and Europe, on Feb. 5, 2003, ICP filed comments on Mizuho's applications to the Federal Reserve Board. Even in its home country, and even after receiving massive public subsidy, Mizuho has "slashed lending to small and medium-size[d] business by $42 billion in the half-year to September 30 [2002], by far the biggest cut among Japan's top seven banking groups." See, Reuters of January 31, 2003; click here to view ICP's Mizuho comments.
February 3, 2003
From an Enron-recap by John Plender: ..as for the analysts, 16 out of 17 in the leading investment banks were still rating Enron a "strong buy" or "buy" before its collapse. Had they been diligent, they would have noted detailed information about related party transactions in Enron's published accounts and the significant profits appearing to come from these transactions. The relevant note to the last published accounts for the year 2000 showed that Enron claimed to have earned revenues from off-balance- sheet affiliates of Dollars 510m (Pounds 330m) in 2000, Dollars 674m in 1999 and Dollars 563m in 1998. It also showed that these affiliates had huge liabilities of more than Dollars 20 billion. A crucial point about Enron is that the Anglo-American system has moved from being one where accountability runs from management to outside shareholders towards a novel form of insider system controlled by managers who have ever-increasing ownership rights, thanks to stock options.
...The more subversive threat to the power of the nation state appears to come from the financial community, of which Enron was an unofficial, unregulated member. The growth in derivatives trading clearly does have the potential to erode the tax base of countries, to subvert government regulation and to make a nonsense of the picture of economic events produced by generally accepted accounting principles. The American way of business has been hijacked by the values of a financial community that is so preoccupied with trading and deal-making that it has lost sight of the purpose of its own existence.
January 27, 2003
"Building Trust"? While the WEF meeting takes place under massive security in Davos, adjacent to it is the The Public Eye on Davos - set up by NGOs to monitor the activities of the WEF and its participants - wants to see binding international rules introduced, requiring multinationals to sign up to agreed environmental and social standards. "The idea is to launch a convention on corporate accountability and responsibility," says Miriam Behrens of Pro-Natura, the Swiss branch of Friends of the Earth. "We promoted the idea at Johannesburg during the Earth Summit with some success, and we believe that heads of state present at WEF could use the summit as a platform to continue the discussion." Behrens says voluntary commitment is not enough and the only way to make multinational corporations accountable is to make them sign up to a UN convention...
January 20, 2003
In the run-up to the World Economic Forum meeting in Davos, the Swiss government announced it will employ soldiers and military jets to help protect "guests." The government will create a no-fly zone with Boeing Co. F/A 18 military jets patrolling the region to provide security for the 2,000 business and political leaders expected at the Jan. 23 to 28 event, said Peter Egger, head of the Swiss Air Force's operational division. And we didn't even know that Switzerland had an air force... About 1,500 soldiers, mountain infantrymen and Air Force personnel will support regional police. Switzerland is spending 13.5 million Swiss francs ($9.7 million) for security this year compared with 8.7 million francs in 2001. Objects without permission to enter the no-fly zone will be warned to leave the area. If they don't change course, the Air Force may shoot them down, according to Egger. Swiss Defense Minister Samuel Schmid would have to approve any use of force. "Building trust" is the theme of the forum...
January 6, 2003
From the trade journal "Brand Strategy," of Jan. 2, 2003: " Twenty-nine per cent of consumers over the last 12 months have stopped buying a product for ethical reasons, while 25% have stopped buying from companies that are damaging the environment and 75% said they would boycott companies in the future... The internet is offering an unprecedented opportunity for the anti- globalization movement. Its international, organizational capacity didn't exist previously. There are a number of American sites where a consumer can insert a brand name to discover if it is a 'good' or a 'bad' company, helping consumers become more informed." Then, Noreena Hertz advises, "Choose your friends wisely. Brands can easily be contaminated. Look up and down your entire supply chain - your partners could all impact on your brand." Apparently, HSBC and its directors have not read the works of Noreena Hertz -- click here for updates on the campaign against HSBC's proposed acquisition of the notorious predatory lender Household International, regarding which ICP / FFW over the holidays filed comments not only in the United States, but also in Singapore and Poland... For or with more information, contact us.
December 23, 2002
From Switzerland, this holiday-season arrogance: the Swiss Bankers Association on Dec. 16 said the impact of the German proposal for "black money" kept in bank accounts abroad to pay only a 25 percent tax rate if returned prior to Dec 31, 2003, will largely depend on the attitude of the individual clients. Swiss Bankers Association spokesman James Neeson told AFX: "The answer is up to the clients. I can only say there were 369 banks in Switzerland before the Italian tax amnesty (last year) and there are still 369 banks today." And that's the bottom line, right? Click here for updates on ICP/FFW's expanding campaign against money laundering-challenged HSBC's proposal to acquire and export the predatory lender Household International. And -- happy holidays.
November 25, 2002
The crusty (to say the least) Economist magazine of Nov. 23 (which also reports ICP's HSBC - Household challenge), asks, regarding Citigroup: "Should Sandy Go?" It responds, for the most part, in the affirmative: "Mr. Weill is one of the highest-paid executives in the world, with a complex package worth more than $250 million over the past two years... The strongest argument against Mr. Weill is that he is not worth it: that Citi's business, notwithstanding its huge profits, has begun to suffer from a series of poor decisions on his watch." We'll leave the Jack Grubman nursery school scandal for others. Weill's blithe purchase of Associates First Capital Corp, and refusal to meaningfully reform its and CitiFinancial's business, particularly on high-cost non-real estate loans with packed insurance (including insurance on leaf blowers, ladders and fishing rods), are both immoral and call into question this eleven-figure compensation package. That such a large corporation doesn't even have a successor ready is amazing. As is the fact that HSBC is now trying to copy Weill's ill-fated Associates move, by proposing to acquire scandal-plagued Household International. ICP's HSBC Watch will be updated weekly or more frequently.
November 11, 2002
In Florence on November 9, over five hundred thousand people marched against corporate globalization and for peace. Organizers of the European Social Forum said up to a million people took part in the march, which skirted Florence's historic center and ended up at the city's soccer stadium. At a much smaller demonstration in Chicago on November 7 (of the " Trans-Atlantic Business Dialogue), a march began at Boeing Corp.'s headquarters at Canal and Washington Streets. The number of police on the scene in the early darkness that fell over rush hour Thursday was surreal. Along with the riot police, there were dozens of officers on bicycles while police boats patrolled the river. At key points along the route, officers were standing two and three deep. There were hundreds of officers stationed at the march's destination, the plaza between Tribune Tower and the north bank of the Chicago River. When police radios squawked with the news that the demonstrators had rounded the corner of Washington and Michigan, the sound of hundreds of riot helmet visors clicking into place resounded across the plaza. From a speech: "The Trans-Atlantic Business Dialogue is a corporate lobbying group that is successfully influencing and manipulating the political environment." Yep.. Note: ICP and the Fair Finance Watch have filed comments with the U.S. Federal Reserve and Canadian regulators opposing Royal Bank of Canada's applications to acquire Florida's Admiralty Bancorp - click here to view. For or with more information, contact us.
October 7, 2002
Time magazine of October 7, 2002, reports that:
Tens of millions of dollars in excessive fees and interest, [Ved Seereeram] says, have been diverted from poor Caribbean countries into the coffers of Citibank, now a unit of Citigroup. Until recently, no one really listened. But with the unraveling of Enron and WorldCom and recent allegations of legal and ethical lapses at Citigroup, Seereeram's cries are finally being heard. As a result of his investigations, Trinidad's tiny island neighbor Dominica has filed suit against the Citibank unit, alleging that it secretly and aggressively overcharged the government of Dominica on a bond issue to finance the island's first international airport. "We believe the allegations are without merit," says Lula Rodriguez, a Citibank spokeswoman. Seereeram hopes Dominica's lawsuit will bring renewed scrutiny to a case closer to home: a 1993 deal to refinance a natural-gas exploration project, in which he claims Citibank overcharged Trinidad's government. Citibank has denied any impropriety in that transaction... Citibank proposed a deal in which it would buy Trintomar's accounts receivable (two-year contracts to supply petroleum to Shell and Texaco) for $ 66 million--a little more than was needed to pay off the Japanese loan. Trintomar agreed in principle and began talks with Citibank to finalize the terms. But then the bank changed the game. In addition to the loan they had been talking about, Citibank wanted to finance a second loan of $ 96.5 million. It was analogous to someone going to borrow money for a car, and as a condition of the deal, the lender insisted that he borrow more than twice what he needed--and pay fees and interest on the whole thing.
That is to say, it's another example of predatory lending by Citigroup. For more, see ICP / FFW's Citigroup Watch. On a lighter note, click here to view ICP's editor's Oct. 3 poem (doggerel) on Citigroup, "Song of Solomon [Brothers]," on the WallStreetPoet.com site...
September 23, 2002
In the run-up to the World Bank / IMF protests in Washington, here's something on Goldman Sachs: a month ago, Inner City Press and the Fair Finance Watch opposed Goldman's application for a bank charter. Goldman Sachs' Proposed Bank would explicitly (only) make its "products... available to Goldman Sachs' high-net-worth clients through their investment professionals." Goldman Sachs' "Community Reinvestment Act Plan" is laughable. While it states that "the Bank's core business would be conducted nationwide," it seeks to limit its CRA assessment area to Salt Lake City, Utah. As to Salt Lake City, Goldman Sachs brags that in 2001 it "partnered" with three other organizations to "plant 30 flats of flowers." CRA Plan at Page 2. Beyond that there is virtually no detail.
But as is most relevant to this ongoing Report, Goldman Sachs' bank's Business Plan states, as a "hallmark[] of the Goldman Sachs corporate culture," that "our assets" include "our... reputation." Plan at 4. ICP's first timely submission raised issues concerning Goldman Sachs' current standardless involvement in questionable subprime lending. To that, FFW has now added the following: Goldman Sachs' makes standardless investments in companies reputed to be sweatshops. For example, Bloomberg News of February 27, 2001, reporting on " Yue Yuen Industrial (Holdings) Ltd., which makes athletic footwear for Nike," states that "Goldman Sachs Group Inc. owns 'slightly less' than 4 percent, said Mary Nee, an executive director at Goldman Sachs, at the meeting. Goldman bought 7.2 percent in the company in 1996."
The San Francisco Chronicle of May 17, 2002, reported that "Yue Yuen... earned harsh criticism from human rights groups -- including its system of fining workers for misbehavior and its practice of paying mainly by piece rate."
As with questionable subprime lender, FFW asks: what standards does Goldman Sachs have for its investment in companies that have " earned harsh criticism from human rights groups"? None, apparently.
August 19, 2002
Twenty-nine of the world's 100 biggest economic entities are multinational companies, according to the United Nations Conference on Trade and Development (Unctad). The field is led by Exxon, which is larger than all but 44 national economies. The activities of the 100 biggest companies, measured on the basis of value-added - the yardstick used to calculate countries' gross domestic product - accounted for 4.3 per cent of world GDP in 2000, up from 3.5 per cent in 1990, Unctad said. Exxon, with estimated value-added of $63 billion, was about the same size as the economy of Pakistan and larger than Peru's, while Ford, DaimlerChrysler, General Electric and Toyota were all comparable in size to the economy of Nigeria. Philip Morris was on a par with Tunisia, Slovakia and Guatemala, while BP, Wal-Mart, IBM and Volkswagen all ranked in size between Libya and Cuba. GlaxoSmithKline and BT, the smallest of the top 100 multinationals, were equal in size to Syria.
August 12, 2002
Explanation of last week's IMF package for Brazil: Citigroup has $12.8 billion in assets there. FleetBoston holds another $11.1 billion in Brazilian assets, JP Morgan Chase $2.7 billion and Bank of America $2 billion....
In preparation for leaving the World Trade Organization at the
end of this month, Michael Moore gave an exit interview with the Australian Business
Review last week (8/7). He said he's confident that the forum is "combating" the
anti-globalization message. "The debate over globalization has been joined. The
battle will never be won. [But] we are making a case we have never made before," he
said, pointing to the WTO's efforts to "engage" the NGO movement. "My first
[NGO] seminar, which was very controversial, took about 80 hours of negotiations with
[WTO] members to accept. The second took me about 20 hours, the third about eight hours.
This is now mainstreamed. And [WTO member governments] understand that it is no longer a
threat. In fact, it is a healthy development. The NGOs' attitudes are also changing. The
NGOs that had been abusing us are now sitting down arguing. Look at how Oxfam has changed.
It is now saying that we are not doing enough on trade. And they are right. They're using
my speeches, the bastards," Moore said...
Chicago will play host Nov. 7 and 8 to the Trans-Atlantic Business Dialogue (TABD). It was
steered to Chicago this year by TABD's U.S. chairman, Boeing Co. Chairman and CEO Philip
Condit... For an update on the campaign about Citigroup, click here.
July 8, 2002
At the World Trade Organization talks in Geneva last week, the U.S. urged 127 WTO members to dismantle import barriers in finance, energy and other services. "Scrapping" restrictions to services trade would mean a trillion-dollar-a year surge in global commerce, Deputy U.S. Trade Representative Peter Allgeier told reporters. "Given our competitiveness, we could probably get pretty close to half of that," Allgeier said on a conference call. Two- thirds of U.S.'s $10-trillion-a-year output comes from services, and the U.S. is the world's largest services exporter, he said. The U.S. made its pitch as the Bush administration is under attack from trading partners for closing its steel and lumber markets and boosting subsidies for farmers just as the WTO talks begin to tackle farm spending. Dean O'Hare, chairman and chief executive officer of insurer Chubb Corp., said success in the talks would help create jobs. "We need trade liberalization across a wide range of services in order to continue to grow our overseas markets and create new U.S. jobs," he said in a statement. "These exports are particularly important at a time of slow growth at home."
In an alternate universe, Chubb two weeks ago filed a claim against Morgan Chase, stating that the bank "surreptitiously lent money to Enron, by way of Mahonia, and expected to be repaid . . . by Enron, with interest" directly or via other offshore vehicles. Morgan Chase claims that everyone, including the insurers, "knew that the (Mahonia) deals were part of a structured financing transaction for Enron's general corporate benefit." What interests or should interest regulators, especially the Federal Reserve, at least as much as NY D.A. Morgenthau, is whether these were in reality loans that the bank did not declare. You thought banks in the U.S. were regulated but it may be that you were wrong, as least in this case... And regulation may further decrease: the European Union, in a copy of its services requests leaked in April, called on the U.S. to remove its restrictions on foreign banks, insurers and mutual funds.
June 17, 2002
Several hundred people protested on June 14 in front of the venue for a two-day meeting of the Group of Seven (G-7) finance ministers in Halifax, Canada. The rally proceeded peacefully; Japan Economic Newswire noted that "[a]ccess to the venue for the G-7 meeting was strictly limited under the heavy guard of local police." Next up: the G-8 meeting on June 26 and 27 in Kananaskis, 120 kilometers west of Calgary... "Our focus can't be on just going from demonstration to demonstration," says Judy Darcy of the Canadian Union of Public Employees. "We've got to focus on linking global trade agreements to domestic issues, like health, hydro, the privatization of water"... There's growing controversy in Ontario over the government's proposed sale of Hydro One, for instance, is predicated in part on fear that an essential commodity (electric power) will become captive to global market forces if the utility is privatized.
June 3, 2002
A positive decision by the California Supreme Court: that Nike's claims about its purported clean-up of historic sweatshop practices is commercial speech, which if not true is actionable. In the Financial Times of May 27, Gap's former flack Elliot Schrage wrote: "California's Supreme Court may have defined a new level of accountability for what corporations say - and do - to show they are responsible corporate citizens at home and abroad. The ruling invites the establishment of a framework to monitor corporate reporting on social performance, comparable with the regulatory framework that governs companies' disclosure of financial and business performance... Just as the Securities and Exchange Commission and Financial Accounting Standards Board establish a framework in the US for public accountants to evaluate corporate financial performance, a new reporting system is needed for independent review of corporate social performance... Many of the most innovative models for corporate social reporting are already developing in Europe. The adoption in March of new social reporting requirements for French corporations is only the most recent demonstration of European belief in the benefits of government intervention. Projects such as the recently launched Global Reporting Initiative and AA1000 standards are approaches gaining support in Europe that will lead to standardized reporting for all companies. In future, companies will need to move way from self-promotional corporate social responsibility reports - such as those recently published by Reebok, Nike, McDonald's and Shell - and move towards independent evaluations by qualified third parties... Ironically, the benefits of greater openness and transparency have not been lost on Nike. Since the lawsuit was first filed, the company has taken big steps towards greater openness, disclosing many (but not all) factory locations, inviting student critics to inspect their facilities and reaching out to groups in Vietnam, Indonesia and Thailand to report publicly on workplace conditions. In future, many companies would do well to adopt at least one aspect of the Nike ethos regarding transparency: just do it."
May 13, 2002
Lobby and buy: Citigroup's "country officer" for Singapore has told the press there that Citi would "have loved" to have bid on Keppel Capital Holdings or Overseas Union Bank last year; now the Monetary Authority of Singapore says it is reviewing its policy against allowing foreign banks to take controlling stakes in local lenders.
In and out: Buenos Aires newspaper La Nacion reported last week that Citigroup has decided to move its Argentine operations to Chile, similar to Spanish bank Banco Santander Central Hispano's decision to transfer it private banking operations from Argentina to Uruguay. The same sources said that "it is possible" that FleetBoston Corp may move to the Montevideo free zone....
The scorecard: the IMF, capitalized at $ 265 billion, has $ 77 billion in loans outstanding...
May 6, 2002
May Day round-up: in France, more than a million people demonstrated against presidential candidate Jean-Marie Le Pen and his National Front. An aside: third-place candidate Lionel Jospin had come out in favor of the so-call Tobin Tax proposal, to regulate international capital flows.... In Montreal, 300 people marched; 200 people rallied at the French consulate in New York to chants of "Go vote! France is in danger," and "Show the world France is not racist." In Spain there were over 75 demonstrations, opposing among other things the government’s plan to cut unemployment benefits. In Italy, half a million people rallied against Prime Minister Silvio Berlusconi's proposals to make it easier to lay-off workers. Police in Zurich fired tear gas and rubber bullets to disperse protesters... In South Korea, unionists vowed an "all-out struggle" for the rights of workers. In Singapore, opposition leader Chee Soon Juan was arrested after he tried to stage an illegal demonstration outside the presidential complex, police and witnesses said...
April 8, 2002
In the U.S., the Public Broadcasting Corporation has begun screening a three-part "documentary" entitled "The Commanding Heights." The first program aired last week, and generally celebrated strike-breaking and other forms of "market discipline." BusinessWeek of April 8 opines, " were The Commanding Heights to be followed by a fourth segment encompassing the next decade, it might well document how the spread of Islamic rage in the Middle East and the Persian Gulf translated into a war between moderates and fundamentalists that paralyzes the oil markets. It might show social upheavals in the dozens of new megacities -- Bombay, Jakarta, Cairo, Sao Paulo -- whose basic infrastructures for housing, health, transportation, and law enforcement are near the breaking point. Future viewers would not be surprised to see a highly disillusioned Latin America, led by Argentina, Venezuela, and Peru, turning once again to socialism and protectionism in a futile attempt to cure its ills. Or what about an economic implosion in Japan, started by a stampede of Japanese investors into dollars and euros? Or a violent strain of anti-Americanism in reaction to Uncle Sam's military and CIA activity in dozens of countries, justified in Washington by an open-ended war against terrorism?"
The main PBS station in New York City, Channel 13, began the program by thanking J.P. Morgan Chase for "making this programming possible." Indeed...
April 1, 2002
This week an IMF "technical team" returns to Argentina, followed next week by the IMF's chief negotiator on Argentina, Anoop Singh. The IMF is expected to demand deeper cuts in government spending -- a move that surely means firing state workers. In Washington, IMF spokesman Thomas Dawson told reporters that no loan agreement is expected before May. The U.S. Treasury's John Taylor said Argentina needs to follow through on pledges to repeal a law making it easier for companies to declare bankruptcy and prevent provinces from racking up debt before aid will begin to flow. Last week, the state of Cordoba, one of Argentina's most industrialized, issued additional bonds despite IMF criticism. Of president Eduardo Duhalde, Rodrigo Vinoles said, "He won't make it until the elections (in September 2003). I don't give him more than 20 days." Many predict a return to protests like those that toppled President Fernando de la Rua on December 20. So, the poker game continues over Argentina....
March 11, 2002
In the run-up to the International Summit on Economic Development to be held in Monterrey, Mexico from March 18 through 22, civil society organizations last week announced plans to protest. They will oppose the privatization of energy resources; on March 21, bank debtors will protest. President Vicente Fox has planned for 3,000 members of his Presidential Guard...
News from Myanmar: last week, underwear manufacturer Triumph International announced that it will close its subsidiary in Myanmar. The company has had a factory there since 1997, but was protested by human rights groups in December 2001 for effectively supporting Myanmar's human rights abuses by continuing to operate there. Factoid ICP's Fair Finance Watch has unearthed from the 2000 "Financial Sourcebook for Southeast Asia: "in 1992, the Central Bank of Myanmar granted licensed to 15 private domestic banks. Representative offices of foreign banks were also allowed in Myanmar." These include HSBC, Societe General, Standard Chartered Bank and ABN-Amro. Notably, there are no U.S.-based banks on the list. But HSBC and ABN-Amro both run retail banks in the U.S (HSBC Bank USA and LaSalle, respectively).; Societe General and Standard Chartered both have wholesale operations in the U.S.... [3/13/02 note: We stand corrected, as least as to HSBC. We appreciate readers make us aware of the above link, and will be reviewing HSBC's and others' investments and loans in Myanmar and elsewhere, going forward].
February 4, 2002
Here is an account of the February 2 march from Central Park South toward the World Economic Forum conference on Park Avenue in New York.
Steps inside the park from Columbus Circle, a beach ball was bounced up and down on a large circle of fabric with a painting on it: "Another World Is Possible." There as a beating on kitchen pots, banners about the economic crisis in Argentina, the Enron scandal; signs portraying the WEF as the World Exploitation Forum.
Further east on Fifth Avenue and 57th Street, the British musician Billy Bragg sang, "No power without accountability." There was drumming; there were puppets; there were several hundred police on the south side of 57th Street, and hundreds more, on motorcycles, on the cross streets over to Madison Avenue. Down on Park Avenue and 49th Street, demonstrators were confined to pens narrower than the sidewalk. Police would instruct pedestrians that they couldn't cross the street, seemingly arbitrarily.
Just before 1:30, a march set off from Fifth Avenue and 57th Street. It proceeded east to Park Avenue, but was then directed north, away from the WEF meeting. It filled Park Avenue, passing offices of Morgan Stanley, and, on Lexington Avenue, the Gap and ING. It proceeded south on Lexington, past the Citigroup building, and was then diverted even further east, toward Third Avenue. Back on Lexington, police blocked pedestrians from proceeding west. Observers wondered why the demonstrators were not allowed to speak their piece, peaceful as it was, on Park Avenue itself.
By days end, the Police Department announced thirty-six arrests. And on Sunday, dozens more were arrested, for even less reason, on the Lower East Side. Midtown was essentially handed over to the WEF-ers; New Yorkers who wished to speak their mind did so under the gaze of riot-equipped police brandishing their ever-reading plastic handcuffs. So it is, in early 2001...
January 28, 2002
The World Economic Forum will beginning its annual meeting in New York City on January 31. In the run-up, the once-progressive Village Voice ran an article entirely focused on police preparations. The article characterizes those who will protest as affluent drop-outs, in contrast to the blue-collar valor of the NYPD. The article has given rise to much consternation among the movement in NYC and beyond -- both as it predicts media coverage of the protests, and as it reflects the now-old, 60's-born "liberal" press' lack of understanding of newer issues. Demands have been made to the Voice for retractions; talk is afoot of a picketing of the Voice's offices. As to what will happen at the WEF, we will report on that next week. The WEF has already announced that their meeting next year will be back in Davos. This is a one-off shift to New York, ostensibly in solidarity with the city most affected by the 9/11 plane-bombings. Whether the WEF's coming actually helps New York and New Yorkers will be addressed next week.
January 7, 2002
The anti-corporate globalization movement remains at a crossroad, nearly four months after 9/11/01 -- more so in the United States than anywhere else. In Ecuador, for example, on January 4 thirty protesters were arrested outside Quito's Central University. They were and are protesting the recent increase in fuel prices decreed by the government in December. The hikes cause a chain reaction of price increases for other products. They also decried the announcement of reduction in the number of beneficiaries of the household gas subsidy. Various organizations have announced demonstrations this week and even the possibility of a general strike to demand better salaries and as a protest over the increase in fuel prices.
Our take on "the movement" is a focus on the transnational financial institutions to whom countries and their people are just spaces on a chess board. U.S.-based Citigroup and J.P. Morgan Chase, for example. Or take for example Standard Chartered. Under now deposed CEO Rana Talwar, StanChart grew to employ 30,000 people in more than 50 countries. In 2001, it acquired ANZ Grindlays Bank in India and the Middle East; in 1999, it acquired a majority stake in Thailand's Nakornthorn Bank. The game in Egypt is developing fast: last year HSBC took control of the Egyptian British Bank and has been expanding like cancer in the region, with affiliates in Saudi Arabia and subsidiaries in Qatar, the United Arab Emirates, Oman, Jordan, Lebanon and the Palestinian territories. StanChart, meanwhile, remains one of nine short-listed bidders seeking control of Bank Central Asia, the third-largest in Indonesia. Standard Chartered said its announced freeze on expansion into new countries did not affect its plans for Indonesia, where it already has a stake in Bank Bali. There is work to be done...
December 31, 2001
In one of the more thoughtful end-of-2001 musings, the London Independent of December 28 noted that some in the movement's "impetus has shifted behind the scenes and direct to the Third World... [I]n the West [activists] are blitzing politicians with mass mail protests, and targeting companies and investors, and working through trade union and political party structures. They also feed the media with critiques of government policies and trade rules, and expose violations of democracy and eco -systems in the Third World. The approach is producing dividends, with a new readiness from national and international policy makers to listen to moderate voices. And if that does not work then, as the post-11 September mood gradually fades, both sides know a return to the streets is always possible." Hear, hear.... These issues will be our focus in 2002, with a variety of tools including our new Fair Finance Watch. Onwards and outwards...
December 24, 2001
In this abbreviated holiday week report, we'll focus on the crisis in Argentina, and on two companies (Citigroup and AIG). Regarding the demonstrations that led to the resignation of Economy Minister Domingo Cavallo, and then President de la Rua, much as been written (click here for a round-up). We'll focus, as is our wont, on the banking angle. The announcements and charges taken by various major banks is indicative both of their exposure and of their arrogance. FleetBoston on December 19 took a $150 million charge-off, primarily due to its "exposure" to Argentine government bonds. It's worth noting that on November 23, 2001, Bloomberg reported that "banks are among the largest holders of Argentine government bonds, owning an estimated $13.9 billion of debt." So who are the other banks?
JP Morgan Chase announced that it has $900 million in exposure -- $300 million in cross-border loans, and the rest "trading-related." A Goldman Sachs analysis told the American Banker newspaper (10/31/01) that Morgan Chase "reduced its exposure to Argentina to less than $1 billion, from about $1.4 billion, and its sovereign debt exposure to less than $200 million, based on contact with the banking company Tuesday" -- that is, October 30, 2001. That day, IMF and U.S. Treasury officials met with representatives of Morgan Chase, Merrill Lynch, Citigroup, CSFB and Deutsche Bank, according to the Buenos Aires newspaper Ambito Financiero.
Citigroup dismissed the whole crisis, at least publicly, saying its exposure (which it refused to quantify) was "immaterial," since Argentina accounts for less than two percent of its earnings. Latin America Regional Reports of September 4, 2001, reported that "Citigroup hosted a first meeting of bondholders with top Treasury officials... This was followed by contacts between the Fund and bondholders, and between Deutsche Bank, the second-biggest trader of Argentine debt, and US Treasury officials."
Spanish and Italian banks are both more affected, and more forthright. Banco Santander Central Hispano has set aside 750 million Euros -- first time we get to report this way -- while Banco Bilbao Vizcaya Argentaria has set aside 200 million Euros. Italy's BNL has over five percent of its assets in Argentina, while Intesa has just under two percent.
At deadline, new Argentine president Rodriguez Saa announced that "the Argentine state will suspend the payment of the foreign debt.' All the resources allocated in the budget to pay the foreign debt will be dedicated instead to create jobs while debt payment remains suspended. The social emergency is Argentina's most serious problem.'' Click here for ongoing updates.
On December 20, Citigroup announced it is hiring ex-IMF managing director Stanley Fischer. Reuters reported that "Fischer, 58, follows a long line of Washington D.C. insiders who have migrated to Wall Street, and will report to former U.S. Treasury Secretary Robert Rubin in his new post at Citigroup." We'll add to the list: ex-Federal Reserve money laundering specialist Richard Small, and ex-Secretary of Energy Bill Richardson. Citigroup's CEO Sandy Weill gushed, "Stan's keen intellect and unique perspectives will be invaluable as we work with governments and clients around the world. His demonstrated ability to manage complex policy negotiations at the IMF and his highly successful work as a strategic adviser to governments will make him an invaluable resource as Citigroup continues to build its global franchise" We're sure Stan will be "invaluable." He did a great job with Argentina, right? Click here for BBC account; click here for ICP's ongoing CitiWatch.
Finally, for this week, AIG. On December 21, AIG's Hank Greenberg appeared on public television's "Charlie Rose Show," primarily to promote his proposal that the federal government step in to help AIG and other large insurers -- but mostly AIG. Greenberg stated that AIG is in 140 countries -- "we open markets," he said -- and, as to when he will retired, stated that "the board [of directors] determines succession." AIG has over $500 billion in assets.
Meanwhile, ICP has continued to critique AIG's record of community reinvestment, and its "subprime" loans at interest rates up to 40%. Most recently, AIG has complained to the U.S. Office of Thrift Supervision that ICP wants to "rummage through [the] bank's internal documents while conducting an inquisition on all of the bank's business practices." Wouldn't it be nice... Onward and upwards (and outwards) in 2002. Happy holidays.
December 3, 2001
We begin this week with press eulogies. The Financial Times, for example, reported on November 30 that "in the two large meetings since the attacks - the World Trade Organization conference in Doha, Qatar, and the International Monetary Fund and World Bank meetings in Ottawa, Canada - the large crowds of demonstrators against the institutions, and economic liberalization in general, have been sharply diminished... [W]hether the appetite remains for the tactics of physical confrontation with the authorities and the police, particularly in view of the violence which greeted meetings this year in Gothenburg, Quebec City and Genoa, remains a more difficult question. The nature of 'The Movement,' as the loose coalition of organizations and individuals with concerns about economic liberalization and globalization is sometimes known, precludes sweeping generalizations about what its members believe. They have an overlapping set of arguments about free trade, poverty, privatization and environmental concerns."
The FT's self-effacing nuance is certainly appropriate. But grassroots groups can hardly rely on the Financial Times as a sensitive receptor to changes in the wind. In a more city-specific account, the Portland Oregonian of November 25 reported that "demonstration numbers have declined as the war in Afghanistan grinds on. Members are worried the coalition is too white, its mission too fuzzy... [T]hey argue [to] work through the United Nations to round up suspects through peacekeeping troops or diplomacy. Terrorists could then be tried in a special tribunal. Some activists also support freezing terrorists' bank accounts or imposing sanctions that hurt the powerful -- not the poor."
This mentioned focus on the funding of terrorism, and through which institutions it has flowed (these include Citigroup, SunTrust, Royal Bank of Scotland, and Barclays -- click here for more), we agree with. The largest banks have lobbied against social regulation, against attempts to crackdown on shell banks and tax havens, against applying transparency and accountability to the corporate Wild West of global finance. This was a problem before September 11, and remains a problem -- a more generally visible problem -- now.
The same Financial Times -- on this beat, they're authoritative -- reported on November 29 that "[w]hen Mohamed Atta... opened a bank account in southern Florida in June 2000, a wire transfer of $69,985 from the Gulf three months later prompted SunTrust Bank to make a suspicious transaction report to the U.S. Treasury's Financial Crimes Enforcement Network." In the SunTrust-Huntington proceeding pending before the Federal Reserve Board, SunTrust has resisted confirming or denying that it filed an SAR report. The FT continued: "U.S. investigators believe about half the $500,000 that the hijackers spent on the September 11 plot was sent by Mustafa Ahmad, who is today regarded by investigators as bin Laden's finance chief, via Dubai money exchanges through Citibank in New York and on to Florida." Citigroup has also not stated whether it filed an SAR report when this money passed through it. The Federal Reserve's ex-head of anti-money laundering, Richard Small, is now co-head of the same terrain at Citigroup. Citi was hiring not only expertise, but access... For more coverage of these issues, click here.
Other relevant updates: in an SEC filing on November 27, Goldman Sachs reported that it holds a 9.8 stake in South Korea's Kookmin Bank, whose acquisition of H&CB was consummated on November 1. Goldman's wholesale in the U.S., but eminently retail in Korea... Also, HSBC is moving to formalize its stake in China, announcing last week that it is "in talks" to buy a minority stake in Bank of Shanghai; HSBC would become first foreign commercial bank to own a stake in a Chinese lender. AIG, of course, is running wild in the Chinese insurance field. And in Japan -- shares in Fuji Fire & Marine Insurance Co Ltd jumped nearly 16 percent on November 29 after the Asahi Shimbun newspaper reported that AIG is considering raising its stake in the casualty insurer... Enough eulogies. There's work to be done.
November 12, 2001
As 5,000 delagates to the World Trade Organization met in a hotel surrounded by soldiers in Qatar, protests took place from Thailand to Switzerland, India to France. In Geneva, police unspooled barbed wire around parks near the WTO's office, as 5,000 people denounced the secret dealings in Doha. Demonstrators also gathered in Paris (and Marseilles, Lille and Lyon), in Hyderabad, and throughout Thailand. At a forum held in Beirut, ATTAC-France's Christophe Aguiton, said that the governments taking part in the WTO meeting "will feel the pressures from the demonstrations around the world. We are not against globalization itself because it is an inevitable movement, what we want is another kind of globalization that gives priority to social equality, development of southern countries and respect to the environment." Well said.
South of Qatar, in the United Arab Emirates, the drive is toward privatization. The AME news service of November 7 reports that "Crown Prince of Abu Dhabi Sheikh Khalifa bin Zayed Al Nahyan has backed further privatization as a way of diversifying funding away from reliance on oil, and called on GCC states to embrace stock and capital markets as well as privatization. At a conference on Tuesday His Highness enthusiastically backed privatization, particularly for water and electricity projects." On November 5, the UAE's monarch spoke by phone with U.S. vice president Cheney. And, following the U.S.'s November 7 crack-down on Al-Barakaat, a money transfer and telecommunications business headquartered in the UAE, but most of whose business is in Somalia. Offices in Boston, Seattle and Columbus, Ohio were closed. On November 8, the UAE quickly followed suit, ordering all financial institutions in the UAE to freeze the assets of Al-Barakaat and Al-Taqwa, which was also named by U.S. President Bush on November 7. Readers of ICP's Finance Watch Report will have seen our earlier report into Al-Taqwa and its principal, Youssef Nada. Mr. Nada was questioned by Swiss police for six hours on November 7. They'd picked him up at his residence in the tax haven of Campione d'Italia. The Wall Street Journal of November 9 details how Al-Barakaat's operation in Boston was able to open accounts with Royal Bank of Scotland's Citizens Bank unit, and then to wire, via J.P. Morgan Chase, $600,000 to the UAE....
October 22, 2001
The chief economist of Zurich Financial Services editorialized in favor of fast track (and more) in the Financial Times on October 18, writing that "the events of September 11 were a profound tragedy in human terms but we should now try to turn them into an opportunity...". At the APEC meeting in Shanghai on October 18, the head of the APEC Study Center at UC San Diego, Richard Feinberg, told reporters that "the best answer to terrorism is globalization, and globalization means a launch, at this point in time, of a new round of trade liberalization."
The WTO meeting Nov. 9-13 is being moved from Qatar to Singapore, Kyodo News agency reported on October 17, citing sources at the Japanese foreign ministry. According to the report, WTO Director General Mike Moore will visit Qatar to inform the Qatari government of the plan before announcing it publicly...
And, World Bank President James Wolfensohn and IMF Managing Director Horst Kohler jointly said they are "pleased to accept the invitation made by Canadian Finance Minister Paul Martin to host meetings" of the two committees in Ottawa on November 17-18...
From the ongoing corporate globalization file, last week the heretofore New Jersey-based engineering company Ingersoll-Rand Co. announced its moving its headquarters to Bermuda, to avoid taxes. For those interested, Ingersoll-Rand's products include Bobcat construction vehicles, Schlage residential locks and Thermo King truck refrigeration units...
October 1, 2001
So here's a question: will the World Trade Organization go ahead with its meetings planned for Doha, Qatar in early November? The WTO chose Qatar in large part so that protesters / opponents would find it difficult to attend. Now the meeting venue is in a potential war zone. Last week, a Qatari government delegation visited the WTO's director-general Michael Moore in Geneva to finalize arrangements. Afterwards, Moore and Qatar Economy and Finance Minister Yussef Hussain Kamal announced that the ministerial conference would go ahead as planned. Moore said: "I am fully confident that Minister Kamal and his team will take every step to ensure the best possible outcome to the Conference. We need a round today more than ever to boost confidence in the global economy, in the multilateral trading system and in international cooperation." This was echoed by Dutch Prime Minister Wim Kok, who told reporters that a "successful world trade round is even more important than it was before...We cannot afford a second Seattle." But others are floating the idea of trying to reach a deal on a new trade round without convening ministers at all, or holding a small one-day ceremony in Geneva at which they would simply declare a new round launched. Unnamed sources propose that a small groups of ministers convene by video-conference calls. But another notes, correctly, that "It would create a big legitimacy problem."
September 24, 2001
In the aftermath of the September 11 plane-bombings of the World Trade Center and the U.S. Pentagon, Inner City / Finance Watch has prepared a report on bank links to Al Qaeda and other state- and non-state terrorist groups -- and on what the Federal Reserve and U.S. Treasury Department have done, and not done, in the recent past on this issue. While initial press accounts centered around Barclays Bank in London, there are many more connections: ABN Amro (owner of LaSalle Bank in the U.S. Midwest) held deposits of Al Qaeda conspirators in India; Deutsche Bank (which bought New York's Bankers Trust in 1999) held millions for a now-incarcerated Pakistani intelligence chief); Fleet is reputed to channel money to the Chechen jihad. The financial regulators will have to take these issues more seriously. Click here to view the whole report.
September 17, 2001
Following the September 11 plane-bombing of the World Trade Center and the U.S. Pentagon, organizations hesitated on how to proceed with planned demonstrations and campaigns. The most immediate decision on the U.S. -- whether to go forward and protest the September 29-30 meetings of the IMF and World Bank -- was resolved by the Bretton Woods institutions themselves, who have decided to cancel the meetings.
In Europe on September 12, ATTAC issued a press release condemning the plane- bombings "in the firmest possible terms, particularly because terrorism has always been used to suppress and suspend democratic freedoms. This crime refers to the special role played by the United States on the international arena, but it does it in the worst possible way, by confusing a people with a state, and massacring thousands of innocent people." Later in the week, ATTAC confirmed that it would not cancel its next planned protest, of the European Union finance ministers' meeting in Liege, Belgium, Sept. 21-23, stating that "we understand the shock in the U.S.... But, in Europe and the rest of the world, we are not in a state of shock. Life goes on -- and we see no reason to change our analysis or our actions."
U.S.-based groups were more cautious. Several indicated, even prior to the IMF / World Bank's decision to cancel the meetings, that they might not protest. One activist mused that, if the protest went forward, participants might wish to carry and wave American flags. Several groups fear that the Bush administration's response will include curbs on civil liberties and the right to protest. Counter Punch has obtained, and sharply criticizes, an internal Sierra Club memo stating that "we are taking other steps to prevent the Sierra Club from being perceived as controversial during this crisis. For now we are going to stop aggressively pushing our agenda...". Counter Punch concludes: " What nonsense! Principles are never more important than when it is inconvenient or dangerous to stand up for them."
Two stray notes: the Heritage Foundation has suggested that the U.S. "order" the International Monetary Fund to pressure Pakistan to break its ties with the Taliban. Pakistan on September 15 indicated that it will assist, if among other things it's national debt is reduced. Debt as discipline.
A post-September 11 task that is being under-reported is the need to inquire into how attacks like these are financed, how the money is moved. Banks with notably lax money laundering policies -- a list including the world's largest bank, Citigroup -- will be examined particularly closely. Sometimes, it's been a matter of direct solicitation: the London Observer of December 13, 1998, reported the visit to Afghanistan of Mark Warner, a director with Barclays Private Bank Ltd., to drum up business... In testimony in federal court in Manhattan in February 2001, Osama bin Laden's paymaster Jamal Ahmed Al-Fadl testified that al-Qaeda had various bank accounts, including with Barclays Bank. While Barclays now tells reporters that it is "fully aware of [its] legal obligations," the reports become more specific: the account was at the Barclays branch in Notting Hill, west on London...
For New York City-based coverage from September 12, 13 and 14, click here and scroll down the page. In coming weeks, we will cover reaction, and future developments, in Asia and Latin America.
September 10, 2001
Following French prime minister Jospin's expressing of interest in a tax on currency speculation, Germany chancellor Gerhard Schroder on September 5 announced a joint task force with France to consider the idea. Schroder said the task force is a move "to deal with the anxieties of those concerned about globalization" and that "I want to discuss with our European and especially French partners how we can react to these relatively autonomous speculative financial flows." The idea -- the so-called Tobin tax -- will be discussed on September 22 by E.U. economics and finance ministers at their informal meeting in Liege.
In the U.S. capital, George Washington University is taking the unprecedented step of ordering its more than 5,000 students to move out of their dormitories from September 27 to October 2, to leave the buildings empty during the IMF and World Bank meetings and demonstrations September 29-30. GWU officials said they are asking most students to go home to their families, and claimed that they are making emergency travel loans and discount plane tickets available and will provide temporary housing or free round-trip bus transportation for some needy students. "If the campus is functioning, we add a complication to anybody worrying about how to handle crowd control," a GWU spokesman said. Executive Assistant D.C. Police Chief Terrance W. Gainer said that GWU students "continue to have a right to be involved in activities around the World Bank. They just won't be able to do it from the university." Easier to use tear gas, if the GWU campus is empty...
As to a basis for protest, consider that in Argentina, the IMF has demanded, and the Argentine government has acceded to, slashing state salaries and some pensions by up to 13 percent, and imposing austerity measures, particularly on the nation's provinces. This has sparked protests throughout Argentina; roadblocks have been erected from the border with Bolivia in the north to Tierra del Fuego in the south. Argentina's debt stands at $128 billion.
It should be remembered, however, that Argentina's (and similar countries') controllers are not limited to the IMF. For example, on September 4, JPMorgan Chase told reporters it would limit its comments about Argentina to its written research reports. Company sources said the restrictions are due to hostile coverage in the Argentine media of Morgan Chase's pessimistic research on the country's financial health. According to Reuters, Morgan Chase is concerned that press coverage could harm its ability to operate locally. "We're now not allowed to talk to the press about anything to do with Argentina. We're trying to keep a very low profile," one JP Morgan analyst said. As well they should...
August 27, 2001
With the World Bank / IMF meetings in Washington now only a month away, last week U.S. public television screened a documentary about the IMF and Jamaica, "Life and Debt." It was generally informative, unabashedly one-sided -- and disappointingly out of date. The main interviewee was Michael Manley, the president of Jamaica during the 1970s, who died in 1997. PBS has created a "discussion board," on which, for example, the IMF's outgoing (in two senses) Stanley Fischer is compared to the plutocrat "Smithers" on the Simpsons television program. Meanwhile, in the real world:
South Korea, long whip-lashed by the IMF, tried last week to sell a troubled securities brokerage to one of the U.S.-based sharks of corporate globalization, AIG. AIG signed the deal -- and then immediately tried to negotiate the price down further, threatening to back out of the deal. This drove the Seoul stock market down. AIG, it should be noted, has made its corporate position the position of the U.S. Trade Representative: China must grant AIG special "grandfathered" rights to own and operate insurance companies in China.
This Report has been a bit truncated, due to a need to focus on the applications by Citizens Financial Group and its parent, the Royal Bank of Scotland, to acquire Mellon's banking business. ICP's Bank Beat has a summary of issues raised to the Federal Reserve.
July 30, 2001
As the numbers, and the violence, at the summits increase, the corporate media devote more space to ridiculing those who question corporate globalization. There's a surge in the use of words like "wrong-headed," and harsher language from the N.Y. Times' Thomas Friedman. Last week, the Wall Street Journal purported to guess where it's all leading... News flash: "Antiglobalization Activists Are Shifting Focus to Multinational Corporations!" (WSJ, 7/23). The fulcrum sentence is this: "the violence in Genoa by more-radical protesters also has distanced them from moderate organizations, prompting many to wonder whether the traditional tactic of demonstrating at big international gatherings hasn't become counterproductive." The Journal mentions campaigns against Boise Cascade, the privatization of D.C. General Hospital, and.. Citigroup. However, only environmental issues are mentioned, despite the Journal's own coverage of Citigroup's record in predatory mortgage lending in its own headquarters city. The article concludes: "'We are proud of our business record,' a Citigroup spokeswoman said" -- among the most generic corporate defenses we've ever heard. As reported elsewhere on this site this week, Citigroup has taken to getting ex-employees of its high-rate consumer finance unit CitiFinancial to sign life-long gag orders, and has sent Skadden Arps lawyer Mitch Ettinger, who defended Bill Clinton against Paula Jones, down to intimidate ex-CitiFinancial loan officers. Click here for more. This, apparently, is not "the movement" -- it's just routine corporate sleaze....
July 2, 2001
In the U.S. Senate on June 26, a bill to give Bush "trade promotion authority" (a/k/a "fast track") was introduced. A corporate lobbying group for the bill has already been formed, called "U.S. Trade." Among the members is... Citigroup, which is taking a lead role. On July 29, Citigroup's Lionel Johnson was one of nine presenters at the Heritage Foundation's Washington shin-dig on "Advancing Free Trade," along with U.S. Trade Representative Robert Zoellick....
Voices from on high: last week, an executive of U.S.-based J.P. Morgan Chase, Luis Oganes, opined to the Quito newspaper El Universo that Ecuador shouldn't have bailed out its failing banks, particularly Filanbanco and Banco del Pacifico. "In a perfect world, those banks would have been closed," Chase's Oganes said. Of course, the U.S. bailed out its savings-and-loan industry and, more recently, its hedge fund Long Term Capital Management (bail-out accomplished with Chase's participation). But Morgan Chase apparently feels free to tell other countries, where it has (even) more leverage, what to do...
June 18, 2001
Web-link of the week: CorpWatch has an interesting report on how Aventis has violated the principles of the United Nation's "Global Compact" -- click here to view. Also note that the Chemical Business Newsbase of June 14 reports that the Indonesian company Salim's chlorine and polyvinyl chloride subsidiary Sulfindo Group has been put up for sale, with J.P. Morgan Chase as the advisor. Sulfindo has a 450,000 tons-per-year caustic soda unit and an 80,000 tons-per-year polyvinyl chloride unit in Serang. That's chemicals; in woods- and forest-related news, the Canadian firm Domtar will receive a loan of $1.85 billion from "sole lead arranger and bookrunner" JP Morgan Chase. The facility will be used to finance Domtar's purchase of four large paper mills from Georgia Pacific...Consolidation is everywhere, in the financial services industry: in Singapore, Oversea-Chinese Banking Corp. announced a $2.7 billion takeover bid for the nation's smallest bank, Keppel Capital Holdings Ltd.. This consolidation is being driven by inroads by HSBC, AMN Amro and Citigroup.
May 29, 2001
Chaos reigned last week in Quito, as Ecuadorian president Gustavo Naboa denounced the mounting opposition to the proposed Crude Oil Pipeline (OCP) which would run 500 kilometers from the Ecuadorian Amazon to the Pacific Ocean, crossing 67 geological faults and passing near six volcanoes. "If the country is to overcome its economic crisis," argued Noboa, "as much petroleum as possible must be extracted, and this can only occur if the pipeline construction is completed." Translation? The "Paris Club," of the holders of Ecuador's sovereign debt, demand repayment in full, so it's time to drill and pump, whatever the costs. Noboa was more philosophical, chiding opponents as those who would rather would rather "defend the little butterflies, the hummingbirds, trees and forests," rather than human beings, who, Noboa pronounced, "are the king of creation and everything in its domain." Less philosophically, he called all opponents "idiots." CONAIE noted that the pipeline threatens the survival of several native populations in the Amazon, including the Zparo community: "President Noboa's defense of the petroleum business as beneficial for the country hides the fact that oil companies are exonerated from income tax and value added taxes for most of their transactions." Developing...
On May 17, the CEO of the United States' largest bank, Citigroup, appeared at a press conference in Mexico City, to announced Citigroup's proposal to acquire Banacci / Banamex, the second largest bank in Mexico. Combined with Citigroup's Confia operation, Citigroup would control 26.4% of the Mexican banking market, and over 21% of all Mexican bank accounts. This $12.5 billion proposal raises a slew of questions, about sovereignty, branch closings, the allocation of bail-outs, the spread of predatory lending, and the (in)adequacy of global bank regulation. Accordingly, we are today beginning a Citigroup - Banamex Watch (click here to view, and bookmark, if appropriate). ICP has written to the Mexican bank regulator, the National Commission on Banking and Securities, to request a copy of all applications filed by Citigroup. A portion of ICP's letter, in English, is here; we'll appreciate from readers of this page any further information about the regulatory process in Mexico (or, going forward, in other nations).
May 7, 2001
The protests of the World Bank's and IMF's Spring meeting in Washington were smaller this year than last: the focus was on Quebec City, and the proposed Free Trade Area of the Americas. But, even given this relative reprieve, the largest stakeholders in the IMF were unable to come to many agreements. U.S. Treasury Secretary Paul O'Neill spoke out against IMF "bail-outs," but the meeting was highlighted by the announcement of a $10 billion plan for Turkey. This money will not reach the poor and unemployed: it's a bail out of the Turkish banking system (and for foreign investors therein). Virtually no progress was made on debt-relief: the U.K. has dropped the issue. Meanwhile, the IMF continues to push Ecuador's congress to raise the value-added tax from 12 to 14 percent. Here's the situation on the ground, in Quito: unemployment stands at 12%, with fully 50% under-employed. In the last two years, one million of Ecuador's 13 million people have left the country, according to the National Institute of Statistics and Censuses. The lines outside the Ministry of Foreign Relations, of people seeking a passport, and outside the Spanish embassy in Quito, of those seeking to apply for an entry visa, continue to grow. Those who leave without documentation face danger: 450 Ecuadoreans died in Central America in the last five months of 2000. 2,978 undocumented Ecuadorian emigrants have been captured by authorities in Guatemala, El Salvador, Mexico and the United States so far this year, according to data provided by the Ecuadorian consulates in these countries. The IMF's proposed solution is further cut-backs; the WTO's and (proposed) FTAA's solution is to open Ecuador ever more to imports from better-off countries. This is the face of corporate globalization, or of global corporatization....
In global casino news, Citigroup was re-confirmed as the number one trader in foreign exchange, the day-trading in countries' currency that makes up the vast majority of reported "international trade," and which has led to crises and austerity from the Far East, to Russia, to Latin America. See how we earn it!
Meanwhile, the other mega-banks continue to trade global assets back and forth. In Australia, the Man Group announced that it has acquired Australian retail futures broker Ord Minnett Jardine Fleming and its over 4,500 retail client from JP Morgan Chase, which also last week sold Jardine Fleming Bank Ltd to South Africa's Standard Bank Investment Corp., for $120 million. Ord Minnett Jardine Fleming's New Zealand team also jumped ship (or was jettisoned), to Macquarie Bank. Bloomberg reported that J.P. Morgan said in March it would sell the business because it didn't fit with its plan. The business was acquired last year when Chase Manhattan Corp. bought Sydney-based Ord Minnett Ltd., which had a business in New Zealand. Chase's purchases of Jardine Fleming. and Ord Minnett, really worked out well, didn't they? And what will happen if and when J.P. Morgan Chase decides to jettison U.S. (prime rate) consumer business?
April 2, 2001
While "The Wall" goes up in Quebec City, farmers and students last week in Thailand protested a meeting of the World Trade Organization, which, they said, were intended to lay the groundwork for a new trade round, in which the Agreement on Agriculture (AOA) will be negotiated.
But, as has become the trend, the meetings inside the Empress Hotel in Chiang Mai purported to include some representatives of civil society. This led Heike Loeschmann of the well-meaning Heinrich Boell Foundation, from inside, to say: "I think it's a little bit counterproductive... Delegates here are debating exactly these issues inside the conference. I feel sad because it is not necessary to do this outside."
In the aforementioned "outside," protesters read from an open letter: "WTO manipulation of Asian governments and communities will not be tolerated... The WTO pretends to have to have organized a forum including members of civil society. However the representatives invited do not represent either the grassroots or small farmers." Kingkorn Narintarakul from the Northern Development Foundation said: "This is a springboard meeting for the meetings in Qatar ... this is the non-transparent manner of the WTO... We demand the withdrawal of the Agreement on Agriculture from WTO trade negotiations. And we just want to show our displeasure about this meeting." Among the demonstrators were members of the Federation of Northern Peasants, a union of farmers' organizations in northern Thailand whose livelihoods have suffered from globalization. "What would Heinrich Boell do?" (WWHBO?) Somehow we think he'd be outside...
Back in Quebec City, a twelve-foot wall will divide inside from outside. Nevertheless, Quebec City mayor Jean-Paul L'Allier said last week that the city will open up community centers and other public buildings to house what he termed "responsible" demonstrators, during the FTAA Summit, April 20-22. Appearing on Quatre-Saisons television, L'Allier said: "We think this is the best way: to permit young and not-so-young people to express themselves democratically rather than slamming the door on them everywhere. Then, what remains for them to do when they want to eat except smash a window and march in and help themselves? We don't want that.... Will it be 1,000, 5,000, 10,000 - we don't know. It's not because they announce 50,000 on Internet that that's what's going to happen... If you have 6,000 or 5,000 police on one side and 10,000 or 12,000 demonstrators on the other, it's like having two piles of wood - you just have to toss a match and you have a much bigger fire than if there were 300 police and 500 demonstrators." Well, we'll see...
March 19, 2001
From North to South in the Americas, corporate globalization is being contested. At this week's meeting of the governors of the Inter-American Development Bank in Santiago, Chile, grassroots community groups are protesting. More professionalized organizations, like the Institute of Political Ecology (IEP), say they're keeping their focus on the FTAA-related meetings scheduled for Buenos Aires, April 6-7 (see last week's report, below). In Quebec City, a ten-foot tall fence is going up around the historic Upper Town; the suburb of Sainte-Foy has passed an ordinance banning the wearing and possession of "a mask, hood, ski mask, or any other object of the same nature to cover one's face." In the sealed zone where the trade ministers will meet, to discuss FTAA drafts that have been withheld from the public, even the churches will be closed: parishioners of St. Pierre United Church will not be allowed to enter the Zone.
In Europe, a committee of the World Trade Organization is meeting to discuss the WTO's emerging "general agreement on trade in services" (GATS), which would further deregulate the world of finance (among other things), and would, despite the WTO's denials, increase the privatization of basic services. While the GATS draft purports to exclude "services supplied in the exercise of governmental authority," there are defined as services "supplied neither on a commercial basis nor in competition with one or more service suppliers." Translation: if it can be sold, it must be sold...
In the U.S. Senate last week, a pro-bank "Bankruptcy Reform Act" was passed, 83-15. Interestingly, a provision that would have eliminated certain U.S. investors' liabilities on Lloyds of London insurance policies they invested in was voted down. The reason? The U.S.'s even more overriding interest in corporate globalization, and unregulated investment in other countries. President Bush' Treasury secretary, Paul O'Neill, wrote a letter to Senators, stating that the provision had "the potential to undercut the rule of law as it applies across international borders today with serious consequences for U.S. interests." That is -- U.S. corporations' globalization interests...
* * *
A week in (financial) globalization: on February 20, Citigroup announced it has agreed to acquire Argentine pension fund Generar AFJP, for about $220 million. Citigroup already controls local fund Siembra AFJP...
On February 22, HSBC's French subsidiary, CCF, was declared the winner of the bidding-war for Banque Hervet, being re-privatized by the French government. HSBC's bid of $480 million beat out Parisbas, Credit du Nord - Dexia, and insurer Groupama. (In the U.S., HSBC has applied to close its branch in a low-income section of New Rochelle, New York).
According to Japan's Yomiuri newspaper, GE Capital Corp. is in final negotiations to take over Tokyo Mutual Life Insurance Co., aiming to complete the deal by the end of February...
Also on February 22, J.P. Morgan Chase announced that it acquired privately held financial record keeper and loan servicing company Colson Services Corp.; the terms of the deal were not disclosed. Colson services about 85,000 secondary-market loans with an outstanding value of more than $30 billion. "We have no plans for staff reductions, but never say never," J.P. Morgan Chase SVP Conrad Kozak said...
February 12, 2001
Following Ecuadorian president Naboa "settling" (for now) demonstrations against IMF-imposed austerity measure (see Global Inner Cities page for more), Jose Cerritelli, "sovereign debt strategist" at Bear Stearns, said "A lot of investors think that Noboa lost a battle to win a war... It was smart crisis management. Noboa showed some compassionate conservatism and gave an insignificant fiscal concession." Alicia Duran, fixed income strategist for the Andean region at Merrill Lynch,. said: "It is a partial reversal of IMF-backed reforms... It does not bode well for future IMF negotiations."
January 22, 2001
Sweatshop news: An agreement has been reached, between workers and the owners of the Chentex factory in the Las Mercedes "free trade" industrial zone outside Managua, Nicaragua. Chentex is contracted to make apparel that Kohl's clothing chain sells in the United States. In May 2000, Chentex management fired eight union leaders. After protests, Chentex fired more workers, and had some of the leaders arrested. After months of struggle, including solidarity actions in the U.S., an agreement's been reached, under which two of the fired union leaders will be reinstated, and the rest will be paid severance. Eighty fired union members will return to their jobs over the next two months. All criminal charges against union leaders will be dropped, as will the company's lawsuit against the union itself. Somehow we doubt we've heard the last of this story...
January 16, 2001
A bit on Davos, more on Quebec City / FTAA: Organizers of the World Economic Forum to be held in Davos, Switzerland on January 25-29, are preparing to cordon off and exclude those who wish to protest. Activists have rented a ski lodge (!); the local "mountain rescue" official who rented out the lodge said he had later alerted police. "It was only later I realized they were demonstrators against the World Economic Forum," the newspaper Dimanche.ch quoted him as saying. In Geneva, attorney Viktor Gyorffy, representing Swiss organizers of the anti-WTO movement, told journalists the official ban contravened the right to freedom of expression. It would have been warranted only if a major section of the would-be demonstrators were inclined to violence, which they were not, he said. Last year, "more than 1,000" demonstrators were there, according to Agence France Presse.
January 1, 2001
Let's review, quickly, the last year:
50,000 take to the streets of Seattle, Nov. 30-Dec. 3, 1999, against the World Trade Organization.
In April 2000, 30,000 protesters fill the streets of northwest Washington, opposing the meetings of the World Bank and International Monetary Fund.
In May 2000, the 33rd annual meeting of the Asian Development Bank is disrupted by 5,000 protesters, most of them Thai farmers. By the meeting's end, the ADB quickly set up an NGO Task Force to "deal with civil society" -- and shifted the location of its 2001 meeting from Seattle to Honolulu.
Both the Republican and Democrat conventions in August (in Philadelphia and Los Angeles, respectively) were protested, though the connection to the global thread is disputed.
Not so in Melbourne, Australia, in early September. 5,000 protesters blockage the Asian meeting of the World Economic Forum inside a casino (a fitting meeting place).
In Prague in mid-September, 10,000 protest the World Bank and IMF, whose presidents offer little more than platitude at their "summit meeting," in a castle, with the protesters.
Millau, Nice, The Hague -- the momentum carried to the end of the year, such that pro-corporate globalization forces now routinely warm that "anti-globalization is in the ascendancy." The upcoming World Economic Forum in Davos, Switzerland, has barred protesters; the WTO is still calculating when and where to meet. And "the movement," in the Americas at least, is focused on the Free Trade Area of the Americas meeting in Quebec City in April 2001.
What has been lacking, however, at least in the so-called First World, is organizing at the (low income) community level, and a clearer focus on corporations, which are the puppet-masters (and beneficiaries) of these various quasi-governmental agencies (the WTO, IMF, World Bank, even Federal Reserve). There is a growing (anti-) Citigroup Campaign, which is reported on (along with more bank-specific weekly updates) on Inner City Press' Citigroup Watch. But what of Chase (or "J.P. Morgan Chase")? Deutsche Bank? Mizuho?
December 18, 2000
...ICP received the following e-mail last week, and encourages readers with useful information to respond directly:
Subj: wal-mart coming to meridian, idaho
Date: 12/10/00 2:15:40 AM Eastern Standard Time
From: djohnson4@uswest.net
To: info [at] innercitypress.org
...I am currently trying to receive as much information as possible to help protest the building of a new Wal-mart in Meridian, Idaho. If possible, if you have anything else as well you could possibly send me on Wal-mart that I can use, I would be forever thankful--thank you so much for the fantastic information you have on your site as well. That will be helping me out a lot ;)
Click the e-mail address above, and pass that information on...
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December 11, 2000
Last week, over 60,000 people protested the European Union meeting in Nice, France, opposing standardless "globalization from above," genetically modified foods, etc.. The protests, larger than those in Seattle in Dec. 1999, were hardly covered in the U.S. press. While that's partially explained by the Florida election fiasco, to many it also smacks of censorship, press black-out. For coverage, click here.
In the U.S., Treasury Secretary Summers was booed and heckled as he delivered a defense of corporate globalization at Oberlin College on Dec. 4. Summers told a raucous audience of 600 that "[t]he question is not who cares more, because all who are moral or sensate care about those living on low or meager incomes. The question is not who says they care the loudest. The question is what can be done, and what, if it is done, will make a difference." Summers then said that working in a sweatshop is "a choice" people make in the face of even "less attractive" alternatives. So, you see, it's really alright... As elsewhere reported, Summers has been meeting with Al Gore -- clearly, he'd like to stay on at Treasury, if, if only... Bush's ideas for Treasury Secretary include the ex-CEO of PaineWebber and Chase Manhattan. Hard to imagine "less attractive alternatives...".
November 20, 2000
Organizing for the Free Trade Area of the Americas summit in Quebec in April 2001 is underway. Here is the "open call," from Quebequois': "Already several organizations in Quebec have begun mobilizing against the FTAA, ranging from unions and NGOs to grassroots groups who will be engaging in non-violent civil disobedience. Analyses... range from those who wish to reform the trading system (social clauses, Tobin Tax, etc.) to those who challenge the underpinnings... The exact framework of this coalition is to be determined by participants, although we'd like to encompass as many groups and individuals, representing a variety of tactics, while stressing decentralization, autonomy and affinity as organizing principles."
November 6, 2000
In Colombia, Occidental Petroleum has begun test drilling on the tribal lands of the U'wa tribe. At the same time, according to the Rainforest Action Network, the Democratic National Committee last week circulated a letter, from a lawyer purporting to represent the U'wa, endorsing Al Gore. RAN has shown that Al Gore's connections to Occidental Petroleum go far beyond $1 million in stock: Al Gore senior worked for Oxy for 28 years, and Junior's remained in touch, in more ways than one, every since. See www.ran.org.
In New York City, the board of education is being run by Harold Levy, a long-time regulatory lawyer for Citigroup. Levy is pushing an "invite the corporations into the schools" approach. For more, see ICP's Bronx Report, where we also make a book suggestion: No Logo, by Canadian journalist Naomi Klein (Picador USA, 1999). Chapter Four's entitled "The Branding of Learning: Ads in Schools," critiques the Levy-like "reasoning, which baldly equates corporate access to the schools with access to modern technology, and by extension the future itself, [a]s at the core of how the brands have managed, over the course of only one decade, to all but eliminate the barrier between ads and education... In this context, corporate partnerships and sponsorship arrangements have seemed to many public schools, particularly those in poorer areas, to be the only possible way out of the high-tech bind. If the price of staying modern is opening the schools to [corporations and] ads, the thinking goes, then parents and teachers will have to grin and bear it."
The difference in New York is that the corporations have managed to get their own man in as head of the schools, to request, on their behalf, access. That Mr. Levy's candidacy was portrayed as somehow big-D Democratic, even progressive, is all the more troubling. Klein in No Logo also notes that "credit card companies... solicit [college] students from the moment they receive their orientation-week information kit to the instant after they receive their degree; at some schools, diplomas come with an envelope stuffed with coupons [and] credit offers." As ICP has noted elsewhere on this site, Columbia University puts the logo of Levy's former (and future) employer, Citigroup, on the back of all student identification cards. Some students have begun to "redact" it, with black magic marker. "If only we'd started with them younger," the thinking seems to be. More on Levy (and Citigroup) in coming weeks. The beat goes on...
October 23, 2000
And now, from a report we filed with indymedia on October 18, a description of an October 17 demonstration against Citigroup, in front of its headquarters in midtown Manhattan. This was coordinated with anti-Citigroup actions in San Diego, Washington, D.C., San Francisco, Seattle, Duluth, Minnesota (protest at an office of Citigroup's high interest rate lender, Citifinancial), Princeton University (blast-fax of comments opposing Citi-Associates), and Cornell University, among other places. We welcome updates and reports from our readers; click here to contact us.
Midway through the October 17 anti-Citigroup rally in NYC, Citibank credit cards were cut up, and student from colleges whose administrations are unself-critically in the thrall of Citigroup (to the point of including Citigroup's logo on the back of all student identification cards) proceeding to cover Citigroup's logo with black magic marker. The crowd chanted, "Hey Hey, Ho Ho, Citigroup has got to go!" Employees streamed out into the plaza to hear the speakers. Anti-Citigroup actions took place elsewhere, in other cities, states and countries, as well; this is a report on the Manhattan anti-Citigroup (first) Day of Action. Citigroup's hegemony over this part of Manhattan's grid was broken, at least temporarily. And not for the last time -- as the rally concluded, the participants chanted, "We'll be back"...
October 9, 2000
According to the United Nations Development Program, 19,000 children die each day as a result of unpayable debt. The clumsy interventions of the World Bank and International Fund have done little to change this. Nevertheless, after the two institutions' annual meeting in Prague was closed, one day early, on September 27, World Bank president James Wolfensohn told an audience of financiers that "[o]utside these walls, young people are demonstrating against globalization. I believe deeply that many of them are asking legitimate questions, and I embrace the commitment of a new generation to fight poverty. I share their passion and their questioning." This is the same Wolfensohn who recently referred to environmental activists as "that Berkeley Mafia."
Among the financiers in Prague was Citigroup's Robert Rubin, who until last year was U.S. Secretary of the Treasury. Now, Rubin is headed to India, to drum up even more business for Citigroup -- in all likelihood, environmentally destructive. Citigroup just won the mandate to lead a $430 million syndicated loan for the largest utility in the Philippines, National Power Corp.. Mr. Rubin, and Citigroup CEO Sandy Weill, presumably do not "share the passion" of the anti-WTO and World Bank protesters...
The perception that this movement is made up primarily of over-privileged college graduates in industrial and post-industrial companies is a carefully maintained fiction, that serves the likes of Citigroup. For example, scarcely reported in the United States was the massive October 2 demonstration in Bangalore, India, against genetically engineered seeds, including by U.S.-based Monsanto. The demonstration proceeded a three-day conference on the future of agriculture (and democracy), coordinated by the non-governmental organization La Via Campesina, a spokesperson for whom said: "We all suffer from the same agenda of globalization. It is affecting us all. We are losing our farms as a few corporations are taking control." Representative of LVC from as far away as Honduras attended the conference; the Honduran delegate said, "We are here to tell the world 'No' to the WTO, 'No' to the International Monetary Fund and 'Yes' to our struggle. We are here to confirm our solidarity." Well said. And the beat (and movement) go on...
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October 2, 2000
On September 26, protests were held in dozens of cities, including Bombay, Pittsburgh, Dhaka, Bangladesh, Chicago (targeting "corporate crime centers"), Champaign-Urbana, Denver, Boston (targeting Pfizer), Hartford, Gainesville, Florida, Louisville, Kentucky, and Portland, Oregon. In San Francisco, and across the Bay in Oakland, Citigroup was accused of greed. Students at a number of college campuses, including NYU, "blast-faxed" Citigroup, with a short statement of opposition to the bank's activities. Clicking here, you may download an MP3 of the chants on the streets of New York City: "Break / The Bank. Break / Break/ The Bank." Citigroup was also targeted in Brazil.
Back in Prague, Tomas Strnad, director of Citicorp Investment Co. mused for Bloomberg: "I do not think that the people that organized these protests in this way -- I mean all the violence -- have reached any better or more positive results for their ideas then they would have managed through calm means. I don't think it helped these people to win more enthusiasts for their ideas..." For a quite different view, see this article from the Guardian newspaper in the United Kingdom.
September 11, 2000
First, the breaking news: thousands of protesters have blockaded the meetings of the World Economic Forum in Melbourne. Bloomberg's coverage quotes Hugh Morgan, managing director of WMC Ltd., the world's third-largest nickel mine, saying that "what we've got is misconceptions about what this is all about... It's about people trying to exchange ideas and help the world be a better place." What - a better place for nickel mining? Ex-World Bank economist Joseph Stiglitz is, as usual, less lost in space: "There are different ways of articulating dissatisfaction with the system and bringing about change. The political process isn't doing a good job about hearing concerns." Click here for the Melbourne IndyMedia Center's on-going coverage. Now, the introduction:
Better late that never -- while Inner City Press has been covering aspects of this beat for some time, we're finally today launching a weekly report surveying, analyzing and even "theorizing" the anti-corporate globalization movement. The IndyMedia sites have kept available a plethora of coverage of the Seattle WTO protests of 1999, the protests to the World Bank and IMF in Washington in April 2000, and the actions at both U.S. political parties' conventions in August 2000. Given the blossoming of Independent Media Centers in the various host-cities of the protests to date, our focus here will be on analysis, not straight reporting.
To begin, some disclosure: Inner City Press / Community on the Move has been, and will continue to be, involved in some of the actions described herein. Elsewhere on this site you will find accounts of some of the protests listed in the paragraph above. While the Independent Media Centers (well, at least those in Philadelphia and New York) asked those wishing to report for them to commit not to "participate in any protesting, demonstrations or direct actions while... identifying... as part of the Independent Media Center" (this quote's from the NYC-IMC's press badge for September 6-8, 2000), Inner City Press since 1987 has tried to bridge the gap between (presumptively non-involved) "reporting" and "participating." This is not the place to rehash the debunking of "objectivity" in the media. We believe that from our position(s), as participants, we can provide potentially useful analysis, and even "news." In the past year alone, the purportedly objective mainstream media has repeatedly missed the stories of these movements -- in ways sometimes funny.
A recent example: the public relations firm, Hill and Knowlton, has an Australian office, which recent sent a memo to large corporations in Australia, pitching its PR skills to defend against anti-corporate "attacks" connected to the September 11 protests in Melbourne. In trying to demonstrate its expertise, Hill and Knowlton provided "evidence" that the "S11" protesters are "connected" with the Seattle anti-WTO protesters, including this paragraph:
"S11's links with the Independent Media Centre, which was involved in the Seattle [WTO] protest, have now been cemented: IMC opened an office in Melbourne last month."
Your average corporate executive, scanning the memo, would infer that the Independent Media Center is another corporation on the move, paying to open a branch office in Melbourne. But, having witnessed the fast and informal founding of the NYC IMC in the week before September 8, this imagery ("links... cemented" by "open[ing] an office") is laughable. There are people all over the world, many of them tech-savvy, who oppose corporate-driven globalization. When one of the lynch-pins of this globalization (the WTO, the WEF, the IMF or World Bank) comes to town, and protests are planned, some tech-savvy people come together, and put up a Web site. Most of the machines are donated or lent; just as most IMC sites are "open content," the IMC has remained, to date, open to any dreamers who want to set up an IMC in their community. To Hill and Knowlton (and its readers), the IMC is an expanding information-providing corporation. In reality, it is a movement, a part of a much wider, informal movement...
[Editor's note: if you wish to follow up, or laugh more, the above-quoted memo concludes: "Please do not hesitate to contact the Hill and Knowlton representative who forwarded you this brief, or contact Damian Coory, Director, Crisis and Issues Management, Hill and Knowlton, Melbourne, Australia on +61 3 9211 2444 or at dcoory@hillandknowlton.com.au" If you contact them, tell us what you hear...].
Until next time, for or with more information, contact us.
A few selected news sources:
Free Speech TV [footage of Seattle N30 (1999), Washington A16 (2000), etc.]
Paper Tiger Television [the full "Showdown in Seattle" video, streaming...]
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