and Robert Weissman
The clock is running
out for Jack Welch, CEO of General Electric. It is also winding down for Don
Morrison, a dairy farmer in upstate New York.
For two decades, Welch
has led the one-time appliance company, transforming it into the world’s most
transnationalized conglomerate with a finance subsidiary as its profit center.
The subject of almost unqualified adulation from the media and market analysts,
he may end his tenure with a loud thud.
Scheduled to retire
this year, Welch extended his reign by an additional year to oversee GE’s
gobbling up of Honeywell. European regulators are now raising serious concerns
about the monopolistic effects of the deal, and appear poised to block it.
Welch, who has made his reputation by pushing all cost-cutting and
market-dominating measures to the extreme, may find that, in his final act, the
law and society finally set some limits on him.
Don Morrison knows all
too well the effect of Welch’s hard-driving effort to cut expenses and
externalize costs, and he hopes it is not only the European antitrust regulators
who find the spine to stand up to Welch.
The U.S. Environmental
Protection Agency (EPA) is expected in August to issue a final decision on
whether it will dredge the Hudson River to clean up a GE-created PCB mess on the
river bed — at a cost of $460 million to GE.
Until 1976, a broad
array of U.S. manufacturers used PCBs (polychlorinated
insulation in electrical equipment. In 1976, Congress banned their manufacture
and sale, following evidence that PCBs cause cancer and other harmful health
effects. Since the banning, new evidence suggests PCBs also disrupt the
endocrine system and lower intelligence levels of children exposed in the womb.
From the 1940s to 1976,
GE dumped 1.3 million pounds of PCBs into the Hudson River, creating what is now
the nation’s largest Superfund site.
Don Morrison knows all
about it. "Twenty-five years ago," he says, "the state dug sludge out of the
river, and put it on land adjoining mine. I figured if they let them put it in
the river, it can’t be that bad. So it didn’t bother me. É When they asked
permission to push it [against my house], I said sure. My kids played in it,
they grew up in it."
Don Morrison’s wife
died of colon cancer at the age of 49. "We can’t prove it, but we believe that
PCB had a tremendous amount to do with it." Now he lives in fear that his
children will suffer from a similar fate.
Morrison and other
survivors want GE at least to remedy the problem, 25 years after PCBs were
outlawed in the United States.
In December 2000, EPA
announced that it agreed, saying that after 16 years of studies, it had
determined to clean up a 40-mile stretch of the Hudson. Under the Superfund law,
GE would be liable for the costs of cleanup.
GE claims that it
supports cleaning the river, and that it has acted responsibly to reduce its
daily PCB pollution to three ounces. But it says dredging will stir up sediments
and make the problem worse.
EPA retorts that the
ongoing public health and environmental consequences of the PCB pollution are
severe, with PCBs at river bottom continuing to enter the food chain. New
technologies, agency experts say, address concerns about spreading contaminants
But GE isn’t just
making arguments. In fine Jack Welch style, GE has pulled out all the stops to
block the dredging plan. GE’s Hudson River lobbying dream team includes former
Senate Majority Leader George Mitchell and former House Appropriations Committee
Chair Robert Livingston. Among other hardball tactics, the company deployed NBC
President and GE Vice Chair Robert Wright to lobby New York City Council members
against a bill endorsing the dredging project. (Think direct intervention from
the head of a TV network, which owns a major station in New York, might give GE
GE certainly has lots
of friends in the Bush administration, and in the Congress.
On the other hand, EPA
chief Christine Todd Whitman endorsed the dredging when she was governor of New
Jersey. And the Bush administration is under pressure not to announce any more
environmentally stupid and harmful policy decisions with an obvious tilt to
corporate interests. So the outcome of the final EPA decision remains very much
The GE of Jack Welch
has made its mark by pushing it workers, suppliers and the law to the limit, and
But his strategies,
though lavishly praised by Wall Street, are basically inhuman, as Don Morrison
and many others can testify.
As Jack Welch’s reign
comes to an end, it is time for the society to say the clock has run out on
Welch’s model of comprehensive and global management by stress. The first way to
deliver that message is for EPA to authorize the go-ahead of the Hudson
dredging, without delay.
[For more on the
GE-Hudson River issue, see www.cleanupge.org.]
Russell Mokhiber is
editor of the Washington, D.C.-based Corporate Crime Reporter. Robert Weissman
is editor of the Washington, D.C.-based Multinational Monitor. They are
co-authors of Corporate Predators: The Hunt for MegaProfits and the Attack on
Democracy (Monroe, Maine: Common Courage Press, 1999).
(c) Russell Mokhiber
and Robert Weissman