Sunday, February 7, 2010

Corporate Crimes in India

S.O.S - eVoice For Justice - e-news weekly
Spreading the light of humanity & freedom
Editor: Nagaraj.M.R...vol.6.issue.7....13/02/2010


In India , a small shop owner to big industrialist have mastered the art of TAX EVASION . their teachers - some corrupt tax officials & auditors. The black money thus created
is causing inflation, feeding the mafia , underworld. Some industrialists lobby ( bribe ) with the government & gets favourable laws enacted. This black money is the main source of funds for political parties , religious bodies & terrorist outfits.

The recent raids by C.B.I & KARNATAKA LOKAYUKTHA have proved how the tax officials have become multi-millionaires. The sad part is that some of the police officials who are on deputation to C.B.I & LOKAYUKTHA themselves are utterly corrupt.

This scourge can only be cured by corporate accountability intoto. However , all the industrialists , traders who are demanding for more flexible labour reforms , economic reforms , infrastructure , etc are not at all concerned about their own accountability with respect to tax , environment , other laws. The MNCs coming to India are not coming here for best Indian talents or infrastructure alone. In their own countries they are feeling the
heat of strict environment laws , consumer laws , share holder disclosures , corporate accountability. Some of these MNCs are being kicked out of their countries , by it's own people .These MNCs are aware that in India , by greasing the palms environment laws , labour laws , tax laws , etc everything can be flouted , cases in courts can be dragged on for years . share holder disclosures , corporate transparency is minimum.

However when a concerned citizen complains about the crimes of guilty corporates , organizations or corrupt public servants , immediate action is not taken. The file is kept pending for months , years together  , allowing the criminals to manipulate all the evidences , records , ground situations. Finally even if action is taken guilty will be let out due to favorable  evidences , there are chances that the concerned citizen himself is falsely implicated & put behind bars . in all such cases all the involved parties must be subjected to lie detector tests .

Bottomline : development is a must , it must be all around . but not at the cost of majority to make a few richer.
 Jai Hind. Vande Mataram.

Your’s sincerely,

Writ of Mandamus to Chief Justice of India & Others    ,

Circle Inspector of Police , Vijayanagar Police Station , Mysore City , Karnataka  ,

 Failure of duties & questions not answered by public servants

Circle Inspector of Police , Vijayanagar Police Station , Mysore City , Karnataka  ,

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CORPORATE ACCOUNTABILITY Scandals related to the appalling practices of multinational corporations like Union Carbide (now DOW), Enron, Coke, Cadbury, and
others may have shocked the nation and the world in the recent past, but the media rarely highlights corporate crimes that extend to murders, destroying habitats, threatening indigenous cultures, causing disease, contaminating the planet's food supply, poisoning
our groundwater and even destroying the very air we breathe.

You think this is an exaggeration? Well consider this. In Bhopal, India more than 8,000 people died in the first three days after 40 tonnes of lethal gas spilled out from Union Carbide's pesticide factory in December 1984. People woke in their homes to fits of coughing, their lungs filling with fluid. 520,000 people were exposed to poisonous gases. 150,000 victims are chronically ill, and even now one person dies every two days. Union Carbide merged with Dow Chemical Corporation two years ago and has ceased to exist as an entity while the present owners Dow refuse to accept any pending liabilities in Bhopal including clean-up of the abandoned site.

In Kodaikanal, India, Hindustan Lever, a subsidiary of Unilever Plc, an Anglo-Dutch multinational dumped mercury waste from its thermometer factory in the surrounding forests and on an innocent local community. When the scandal was exposed, first the company denied that there was a problem and later fudged facts and figures until the Indian authorities forced them to come clean. Since then Unilever has retrieved and sent back to USA some of the waste for disposal but are shying away from compensating affected workers and further environmental remediation measures.

Monsanto, one of the world's largest pesticide companies, continues to sell its genetically engineered seeds to farmers around the world despite growing evidence of failure of crops like Bt cotton, that has reduced once well-to-do farmers in the developing world to penury and poverty while the threat of contamination of indigenous species by GE
seeds increases everyday.

Bayer AG, a German transnational continues to manufacture and sell phased out pesticides like Methyl Parathion (brand name Folidol/Metacid) in Asia despite an assurance to their European investors and stake holders that they would stop manufacturing these organo-phosphate poisons.

Ship-owning companies (and indeed, their countries) like Bergesen (Norway), and Chandris (Greece) meanwhile, regularly violate international and national laws and dump their hazardous wastes at ship-breaking yards in India, Pakistan, China, Turkey and Bangladesh. The voluntary guidelines issued by International Marine Organisation
are not enough and it is imperative that these guidelines are made mandatory to make the ship-owners liable and responsible.

In the era of globalization, multinational companies increasingly move around assets, products and wastes on a global chessboard to maximize their profits and minimize their costs. These companies are using differences and loopholes in national environmental and health laws for example to export pesticides and destructive technologies to
poorer countries to the detriment of local communities. What international body oversees them, or sets rules for their behaviour, or holds them accountable when they transgress?

It is no longer just the conspiracy theorists who believe our world is increasingly ruled and ruined by large multinational corporations. The World Trade Organisation has supplanted environmental treaties and regulations. Corporations have become accountable only under the rules of a free market, free trade and a free for all on human rights and the environment.

The state of our environment has not improved, in fact it has deteriorated. The gap between the world's rich and poor has widened. Instead of providing developing countries with the tools for sustainable development, corporations have pushed their dirty
technologies and polluting industries on to some of the world's poorest countries.

A recent UN report revealed that Exxon, with $63 billion, is worth more than Peru or New Zealand. General Electric more than Kuwait. Shell is worth more than Morocco or Cuba.

In the past ten years, corporations have not only resisted
environmental challenges, they have lobbied to water down
international treaties and even succeeded in getting countries to
pull out of environmental agreements altogether. They have maintained
their unsustainable practices in all sectors. It is apparent that
more than just voluntary measures are needed to control these

A recent report by WWF states that if we continue at current levels
of consumption we will use up all of the Earth's resources within 50
years, and we will need two more planets to meet our resource needs.
We either take urgent action to save the planet, or we get off.
The UN Environmental Programme agrees that "the state of the planet
is getting worse." They say "there is a growing gap between the
efforts of business and industry to reduce their impact on the
environment and the worsening state of the planet."

At the root of our environmental problems are the unsustainable
practices of the corporations that shape our economies. But what is
the good of a short-term healthy economy if we can't drink the water,
eat the foods in the fields or breathe the air?

Current systems of governance in Asia (as elsewhere) are proving to
be deficient against the activities of abusive multinational
corporations. To roll back the excessive powers of corporations and
to pressure governments to check corporate abuse and prosecute
corporate crimes, greater public participation is a must. The Rainbow
Warrior's Corporate Accountability Tour of India is part of a global
movement to change the climate of opinion against abusive
corporations and to turn the tide in favour of fundamental human

Corporations need to be held accountable for their actions that are
destroying the planet, destroying people's lives around the globe.
There is only one answer. We must stand up to the corporations. Our
governments must agree on international, legally binding rules for
corporate responsibility, accountability and liability: a set of
rules that business must follow, and governments must enforce.
The list of rules is long, but so are the crimes.

The world needs corporations to be held accountable to the following
laws – no matter where they operate in the world. HUMAN RIGHTS WATCH
is calling upon the Indian Government to endorse the Bhopal
Principles on Corporate Responsibility, which call on Multinational
Corporations to:
• Accept liability for environmental damage and compensate victims of
• Accept liability for the damage, no matter when it happens, what
the cause or who in the corporation is responsible;
• Accept responsibility for damage and injury beyond national borders
including accidents in the oceans and atmosphere;
• Ensure that they do not infringe upon basic human rights;
• Disclose all information regarding releases into the environment to
the public;
• Protect human and social rights including the highest standards for
rights to health care and a clean environment;
• Avoid influence over governments, combat bribery and practice
• Allow states to maintain their sovereignty over their own food
• Implement a precautionary principle and take preventative action
before environmental damages or health effects are incurred; and
• Promote and practice clean and sustainable development


Corporate  fraud is nothing new to india    , satyam company is just a new addition to it. Satyam co was able to commit such a huge fraud & keep it under wraps for years goes to prove the honesty , integrity of our public servants , government officials belonging to SEBI , RBI , tax dept , pollution control , labour  depts. , etc & the honesty of auditors & company secretaries. Ofcourse , still there are few honest people in public service , auditing & company secretaryship , but majority of them are hand in gloves with corporate criminals. Definitely , this fraud will also be brushed under the carpet after certain time as other frauds happened , afterall these frauds are the money spinners for political party funding , mafia , underworld & other criminal activities.          

IN INDIA , government reports , records , everything can be bought for a price. During Karnataka lokayukta raids huge wealth amounting crores of rupees were found with each of the corrupt government officials like police , engineers , tax officials ,  etc. How those government officials with few thousands of salary earn so much , by compromising with their government duties , by  creating fake government reports , records , etc . The government & the courts of justice treat those government reports , as sacrosanct like TEN COMMANDMENTS DIRECTLY FROM THE MOUTH OF GOD HIMSELF.      

The CORPORATE CRIMINALS & RICH CRIMINALS buy favourable government reports , records from the government officials commit bigger crimes , escapes from legal prosecution by proving their innocence , honesty with the aid of BOUGHT GOVERNMENT REPORTS & RECORDS. The courts of justice lacks broad vision , it has only narrow vision as  a riding horse's vision is narrowed . courts of justice is only bothered about technicalities , evidences , records , it lacks the spirit of QUEST FOR TRUTH , it lacks  truth finding mechanism out of massive reports , records , evidences. The rich criminals are in a position to manipulate , buy out evidences , government reports , so definitely they will escape from hook. Today , I  can convincingly state that our legal system is such that , even the terrorists who attacked our TEMPLE OF DEMOCRACY -  THE INDIAN PARLIAMENT will be let free , when they can fully buyout evidences , reports , etc.
In this backdrop , the corporates technically maintain clean public image although privately they are frauds , criminals. If anybody makes a statement of truth against them , those corporate criminals will slap defamatory & other criminal charges against such persons. The courts of justice upholds the claims of not the speaker of truth but the corporate criminals , on the basis of  bought evidences , government reports. The courts doesn't go into the truthfulness of those reports , evidences & sends the speaker of  truth to prison. If any person has made any complaints of fraud against Satyam Co , two months back he would have definitely faced criminal prosecution &  jail term. As all the records , auditor reports , company secretary report  , reports of  ministry of company affairs , reports of tax departments , everything was in it's favour.  The courts are only bothered about evidences , records which were all in satyam's favour , the courts are least bothered about quest for truth & justice. In this manner in India , there are hordes of private companies where frauds have taken place & taking place & wiil be.
Just recently after Ramalinga raju's own statement , does it became public that the reports of auditor , company secretary , related governmet records are all false. Base linbe everything was bought. Do remember that whether it is SATYAM FRAUD , ENRON SCAM or XEROX SCAM , those were not found , revealed either by our investigating agencies or the government. Satyam's Fraud came to light due to pressure created by the recession , market forces on the company's promoter Mr.RAMALINGA RAJU & his resultant confession , Enron scam was unearthed by US investigators in USA during the corse of their investrigation , It is the same with XEROX Co . till those revealations , those companies were good , legally abiding cos in govt records. THAT MEANS THEY HAVE BOUGHT OUT INDIAN LEGAL SYSTEM EFFECTIVELY.

In this manner , in India most of the entrpreneurs small shop owners to big corporates buy out tax officials , labour department officials , pollution control board officials  , etc & openly indulge in unfair , illegal trade practices , labour practices , legal violations , etc , still go unpunished , as as per book , the government records they are law abiding , persons , corporates.     

Entrepreneurs , promoters of big corporations collect public money either through shares , debentures  , bank loans or all . so ideally public are also stake holders in such companies . The criminal entrpreneures , promoters  siphon-off  companies resources in various ways like selling company assets to their sister cos  at a lesser value or purchasing assets from sister cos at a higher value , giving loans to sister cos at low interest rate or taking loans from sister cos at higher interest rate , etc. in this way they siphon-off resources of public companies / enterprises with bank loans  to their own family owned sister cos. We at e-voice of human rights of watch are ready to catch such corporate criminals & help the government , ofcourse subject to conditions , are you ready ?

In india , tax compliance is worse. In our criminal justice system, there is rigorous imprisonment for a pick-pocketer stealing Rs.10. even the authorities spend thousands of rupees in legally prosecuting him & the thief spends a year or more as punishment behind bars. Where as there is no commensurate investigation nor  legal prosecution nor punishment  for corporate thieves , evading tax to the tune of crores of rupees. In contrast, those tax thieves pay a part of that booty to the ministers & political parties and get crores of rupees tax exemptions , incentives from the government. Government is rewarding corporate criminals.
                    The tax officials of central & state governments are hand in glove with these corporate criminals & traders. For a price, they are helping corporates & traders in evading tax. Most of the tax officials are wealthy & leading luxurious  lifestyles , much beyond the scope of their legal income. The black money thus generated every year by tax evasion , is many times more than our total annual budget allocation. As a result, all our fiscal reforms fail & inflation is soaring. This black money is the source of illegal funding of political parties , terrorist outfits & underworld. It is a greater threat to national unity & integrity.
                    Both the central government & karnataka state government  have failed to collect the full , actual tax dues from corporates & traders. As a result , the governments don't have enough money in their coffers  even to provide basic needs like health care , education , safe drinking water , etc to the poor & needy. For every Rs.100 tax evaded , one poor patient is dying without medical care , 10 poor persons lack education , 100 persons don't get safe drinking water , 100 persons barely survive on a single piece meal per day , 20 persons starve. Most of The government officials , ministers & people's representatives who have deliberately failed in their duties of tax collection & welfare of poor citizens , SHAMELESSLY indulge in luxurious lifestyle at the expense of poor tax payer . they live in paltial bungalows , chauffer driven AC cars , all living food expenses paid by exchequer , dine at 5-star hotels , only drink bottled mineral water ,  eat non-vegetarian dishes , drink alcohol  sitting before mahatma gandhi's photograph & preaching mahatma's ideals. Mahatma preached & practiced simple living , vegetarianism & he was teto teller , he paid for his expenses from his earnings . these public servants are parasites , who are making merry at the expense of tax payer.
                    Some non government organisations ( NGO) have formed trusts and under the aegis of those trusts are running educational institutions , hospitals , community halls , etc , in the name of providing free / subsidised services like education , health care , etc to the poor. It is only in record books , they conduct fake medical camps , self employment training camps . in practice they are running these educational  institutions , hospitals & community halls as commercial enterprises & collecting huge fees. they are not even  remitting full fees collected to the trust account & swindling the money. no outsider is allowed to become a member of these NGOs , only their cronies & their family members are in these trusts.
                   Numerous NGOs promoted by religious bodies , mutts  are swindling public & government money to the tune of crores of rupees. Nobody dares to question  the heads , pontiffs of these mutts , as at his feet VVIPs , ministers fall down. These religious bodies are hot beds of fundamentalism , terrorism  & mafia.  Hwere is the accountability of religious bodies & political parties in in india ?
                    Inspite of bringing specific cases to the notice of authorities , they are mum ? hereby , E-VOICE OF HUMAN RIGHTS WATCH offers it's services ( subject to conditions ) to the governments of india & karnataka , in apprehending the criminals – tax evaders. Are you ready mr. singh sir & mr.Yediyurappa sir ? If you are ready to do your duty look into the following cases , take appropriate action & kindly inform me about the outcome.

We condemn the brutal massacre by police on farmers – who are going to loss all their lands , sources.of livelihood for the sake of special economic zones , industrial parks , etc in various states of India.

In every mega projects undertaken by government , both the state government & central government have functioned  like  REAL ESTATE / COMMISSION  AGENTS for the rich & mighty . the government says it is acquiring lands for development of industries , for public good. In reality there is only good of rich & mighty.

For forming S.E.Zs , corporates gets speedy single window approvals from government , lands at concessional rates – lower than market value  , soft loans from Indian banks , tax exemptions for years from the government , dedicated power supply , etc , from the government . these corporates are even given free hand to raise share capital in the Indian market. the government has enacted flexible labour laws specifically for S.E.Zs , they can hire & fire without bothering to pay gratuity , etc and they are exempted from providing P.F / E.S.I  coverage to their employees ie they need not worry about the occupational health hazards of their employees , they can employ them till they are fit & throw them on streets afterwards. These corporates take our own money,  employ our own people , use our own natural resources & finally  take away the net profits to their home countries  – what they give back ? – environmental pollution , tax evasions , low paid occupational hazardous jobs to locals , stock market scams .

During Previous License Regime foreign, investment was not directly welcome in India. As people at that time perceived it as "Neo colonisation" & detested it. There were various restrictions on foreign investments. The local industrialists under monopolistic
environment thrived, who were no way better than day light robberers, of course with a few exception. Under the political patronage, the cunning industrialists looted public money, cheated the government of tax, cheated lending banks & cheated the investors
too. They easily flouted labour laws & made labourers to work in inhuman conditions.

During 1990's under the international pressure India signed GATT & slowly started opening it's economy. Now, from 01/01/05 even product patent has come into force in India. Are MNCs bringing high technology intensive industries to India? No, not at all. They are actually denying sophisticated technologies to India. They are only
bringing the FMCG industries - salt, chips, ketch-up, colas, for which India is a huge home market. They are into services like Hotels, medical care, marketing. In other cases, they are just marketing the products manufactured at their bases in U.S.A. or Europe.

They are not bringing in new production technologies in the areas like space research, nuclear energy, bio-technology, pharmaceuticals or pollution control, to India. Also, some MNCs are relocating their highly polluting industries to India, as they are subjected to stringent environmental protection standards in their own home countries. Whereas, In India the Government is highly corrupt & can be bought for a price. The attractive points for foreign direct investment (FDI) in India are,

1. There is lack of comprehensive environmental norms.

2. The enforcement of environmental norms is lax.

3. The cost of health coverage, social security net to be provided to the workers exposed to the occupational hazards is less.

4. The cost of compensation to be paid to the persons-who died or suffered damages due to occupational hazards/environmental pollution is meager.

5. The enforcement of labour laws are lax.

6. Public money can be easily raised through lending Banks, primary market within India & the public can be easily cheated.

7. The tax can be evaded through various loopholes like transferring money to holding companies situated at Mauritius or countries which have double taxation avoidance agreement with India.

8. The tax can be evaded, company money can be cheated by lending money to sister / holding concerns at low interest rates or by selling shares, materials to their private companies at low rates or by buying shares, materials from their holding/sister concerns at exhorbitant rates, etc.

9. The corporate governance laws are almost absent in India & it's enforcement nil.

10. Above all, the time can be bought by very slow Indian legal system, if any dispute arise.

11. On top of it, well trained, technically qualified people are available at low rates through contractors.

Just consider the following cases which highlight the apathy, irresponsibility of  government of India and emboldened the cunning, MNCs:-

1. The India which boasts of so much scientific/technological advancements, is till date has been unable to provide potable water to it's people. People of west Bengal , Karnataka , Andrapradesh states are forced to drink Arsenic, Fluoride poisoned water.

2. The people living near the mines of R.E.M.P. in Kerala are suffering due to exposure to the radio active materials, Same is the case with the people of Jadaguda, Jharkhand, living near the U.C.I.L. plant. Both M/S R.E.M.P & M/s U.C.I.L are department of atomic energy enterprises.

3. Few years back, In Mysore railway station containers of radio- active materials were left unattended. The dome of reactor building at construction stage collapsed in nuclear power plant at Kaiga. A fire tragedy occurred in Kakrapar nuclear power plant. In the recent Tsunami waves onslaught, certain important facilities of Koodakulam atomic plant were damaged near Chennai.

4. In 1984, U.S. based MNC union carbide mass murdered nearly 20,000 people, injured lakhs who are still suffering health problems. The polluted poisonous accident site i.e. Union carbide plant in Bhopal is not yet cleared off toxic materials even after 20 years.
This is still further damaging the residents of Bhopal.

5. In the above union carbide disaster, the Government of India didn't present the case properly before supreme courts of India & U.S.A.. As a result the MNC just paid a pittance as compensation. As per that the cost of Indian lives are just a fraction of cost of
American lives. Just imagine if a same disaster occurred in U.S.A. at the plant of a MNC headquartered in India, what would have been the consequence?

6. In India, hazardous chemicals laced with food additives are passed through the drinks, beverages like pepsi, cola, coco cola very easily.

7. The medicines like nimesulide, paracetamol, etc. with hazardous side effects which are banned in U.S.A.& Europe, are easily marketed by the same U.S.& Europe based MNCs in India.

8. In India spurious drugs, medicines, food stuffs are easily marketed.

9. In India, the clinical trials of new medicines under research are done without proper compensation structure to those being tried upon ie. Virtual guinea pigs.

10. In India, the genetically engineered BT crops are being introduced without paying attention to formers, ecology or eco-system.

11. In India, during setting up of large projects, scant attention is paid to environment, eco-system & the displaced persons.

Most of the times, in government projects itself the displaced persons are cheated by the government in numerous ways.

12. In India, various Government as well as private hospitals dumps hospital wastes with deadly viruses in the open, with scant regard to public health.

13. In India, aged ships belonging to foreign countries are breaked down to scrap in ship breaking yards of Gujarath , Maharashtra & AP. Various toxins like the Asbestos, lead, etc & the hazardous, dirty water, Oil inside the ship are drained into Indian seashore. The labourers here are forced to work without any safety gears.

14. When specific cases of human rights violations were brought before the government & Judiciary by us , both of them didn't respond at all.

All the above cases highlight the fact that, government of India & Indian judiciary treats it's citizens lives as cheap, dispensable at will. This is the major attracting force for MNCs to India.


The Satyam [ Get Quote ] scandal has been wrongly called 'India's Enron', after the gigantic fraud at the US energy-trading company, which came to light in 2001 and became a metaphor for corporate crime.
In fact, the Satyam scam is much bigger in absolute magnitude and likely impact. The amount stolen from Enron was Rs 2,866 crores (Rs 28.66 billion) at current exchange rates. In the Satyam case, according to its promoter-chairman B Ramalingam Raju, Rs 7,136 crores (Rs 71.36 billion) were involved. Also greater are the number of defaulting agencies and their failures.
The impact of the Satyam scandal won't be confined to the 53,000 people on its payroll -- a number higher than the 40,000 Enron employees. The entire Information Technology industry will be singed by the swindle just when the global economic slowdown is already hurting it. The World Bank's ban on IT-India's No 3 Wipro [ Get Quote ], and Megasoft, besides Satyam, for unethical practices will further aggravate the industry's difficulties.
The Satyam swindle has tarnished the image of India's [ Images ] IT industry and cast a shadow over its remarkable 30 percent annual growth, which is generally attributed to virtuousness, brainpower and hard work, not inherited wealth. It has lowered the profile of Andhra Pradesh as a land of gutsy businessmen -- fondly paraded by successive chief ministers as 'Andhra-preneurs' -- who combine a robust native business genius with a modern extrovert outlook.
Above all, the scam has exposed huge cracks in India's corporate governance structures and system of regulation through the Securities and Exchange Board of India, SEBI, ministry of corporate affairs and the Serious Fraud Investigation Office. Unless the entire system is radically overhauled and made publicly accountable, corrupt corporate practices will recur, robbing wealth from the exchequer, public banks and shareholders.
The Andhra Pradesh government has treated Mr Raju with kid gloves. It failed to arrest him for three days after he made a public confession, thus giving him time to sanitise/destroy incriminating evidence. His detention by the state police means that SEBI has been effectively barred from questioning him. This has bred speculation that Mr Raju has cut a political deal under which his family would be protected and certain officials rewarded. The Centre too is preparing to spend Rs 2,000 crores to rescue Satyam and public sector units haven't shifted their IT operations to other companies.
Mr Raju's January 7 confession and surrender to the police should fool no one. Contrary to his earlier claim that 'neither me, nor the managing director (his brother) took even one rupee/dollar from the company...', he now says he has been cooking Satyam's books for seven years.
He is estimated to have made Rs 2,065 crores (Rs 20.65 billion) by artificially jacking up the price of Satyam's shares and selling his holdings (14 percent of the total). Satyam's Chief Finance Officer Vadalamani Srinivas has said the fixed deposits shown in the books were fictitious.
We still don't know the scam's true dimensions. But two things are abundantly clear. First, it's extremely doubtful that Mr Raju inflated Satyam's income by Rs 5,000-plus crores (Rs 50 billion) and even put in Rs 1,230 crores (Rs 12.30 billion) of his own money. It simply doesn't stand to reason that he would do this and not siphon off large sums. Equally dubious is his claim that Satyam's operating margin was as low as 3 percent, compared to the 25 to 30 percent for top-ranking IT companies.
If Satyam's margin was indeed higher, then thousands of crores were spirited out of the company. It is imperative that this trail is rigorously traced. It would be surprising if it doesn't lead to real estate scams or to benami accounts held by politicians. Former Union revenue secretary E A S Sarma, a public-spirited civil servant of exceptional integrity, has tried to find some of these tracks through the Right to Information Act, RTI.
He looked at a private company which is building Gangavaram Port in Andhra and found that 18 percent of its equity is held by Lakeside Investments Ltd, a Mauritius-based company, 'apparently... a smokescreen for tax evasion.' Mr Raju reportedly owns a company with a similar name, Lakeview Investments, and with the same address.
Mr Sarma has also raised serious questions about the way the state has handed out thousands of acres without competitive bidding to Maytas (Satyam spelt backwards) Properties and Maytas Infrastructure. Maytas Infra alone has projects worth Rs 30,000 crores (Rs 300 billion) in Andhra, including the Rs 12,000-crore Hyderabad metro rail and irrigation projects worth Rs 13,000 crores (Rs 130 billion). All this warrants an in-depth investigation.
Secondly, surrendering to the police in India was Mr Raju's best guarantee against extradition to the United States, where numerous criminal cases have been filed against him and where the punishment will be more rigorous and prompt than in India. For instance, Enron's Kenneth Lay was charged on 11 counts and set to be sentenced to 45 years in jail when he died.
If Mr Raju is tried for criminal breach of trust in India, he could get away with as little as three years. Even if he gets a life sentence, he may end up spending 10 years or less in prison.
The Satyam swindle became possible because all supervisory mechanisms failed, including the statutory auditor, PriceWaterhouseCoopers, PwC, independent directors, and SEBI. PwC didn't verify the authenticity of the account-books. It had similarly failed with Global Trust Bank, which collapsed. Irregularities were noted in PwC's handling of Satyam accounts in 2001, but mysteriously, no probe was conducted.
Similarly, a complaint was filed with SEBI by Member of Parliament Ramdas Athavale in 2003. But under political pressure, this was not pursued.
PwC, which has audited Satyam's accounts since 1991, is guilty of grave misconduct and should have faced punitive action from the Institute of Chartered Accounts of India, ICAI. Ironically, PwC has two members in the ICAI disciplinary council!. The council met, but failed to take action against PwC. ICAI, like the Bar Council or Medical Association of India, shields, and rarely acts against, even the most errant of its members.
Satyam's independent directors did no better. They asked no questions about the accounts When the board met last month to approve the scandalous proposal to invest $1.6 billion in Maytas, it didn't even refer to the conflict of interest in buying a company in a completely unrelated business, floated by the promoter. It only went into technicalities of conformity with SEBI guidelines, and valuation of assets. Indeed, one of the independent directors, Krishna Palepu of the Harvard Business School, waxed eloquent on the merits of real estate investment.
These directors collect fat annual fees ranging from Rs 13 lakhs to Rs 92 lakhs (Rs 1.3 million to Rs 9.2 billion) just for attending a few meetings, but clearly lack independence. Many independent directors in India see board memberships as sinecures or lucrative pastimes unrelated to corporate governance and public responsibilities.
Even worse was SEBI's failure to investigate Satyam and refuse to approve its patently foul transactions including the Maytas deal, which was aborted by investor protests. SEBI also ignored a December 18 letter on Satyam sent by Mr Sarma. Other authorities also turned a blind eye to various complaints about the illegal allocation of 17,000 acres of land to Satyam group companies in different cities, in violation of their master plans.
India lacks adequate corporate regulation, and its enforcement is pathetic. For instance, as many as 1,228 of the Bombay Stock Exchange's [ Images ] 4,995 listed companies have failed to submit reports required by Clause 49 of the Listing Agreement, including information on their boards' composition, audit committees, CEO/CFO certification of accounts, and related-party transactions and subsidiary companies.
Corrective action is overdue if corporations are not to cheat stakeholders and the public. Indian capitalism has always had a criminal side to it. Our corporate nabobs often milk their companies by appointing procurement and distribution agents, by under- and over-invoicing imports/exports, evading taxes, indulging in insider trading, and dressing up balance-sheets. Satyam fits this pattern, which is widely prevalent in most brick-and-mortar companies.
Some corrective steps are self-evident. Statutory auditors aren't enough. We need a Board of Audit, which like the Comptroller and Auditor General of India, is authorised to conduct surprise audit on its own or on whistle-blower complaints. Besides, no auditor should be allowed to continue beyond three years.
The government should create a pool of independent directors from amongst citizens of high integrity. Impartial authorities, not company managements, should appoint them and fix their remuneration. Cross-directorships must be banned. All agent appointments must be thoroughly scrutinised. Penalties must be stiffened. The conviction rate in corporate frauds, currently under 5 percent, must be improved.
Breach of trust and fraud must be heavily penalised. If an auditor fails in his duty in India, he faces a ridiculous penalty of Rs 10,000 and maximum imprisonment of 2 years. The US Sarbanes-Oxley Act, passed after the Enron and WorldCom scandals, awards imprisonment for 20 years. The US has greatly improved fraud detection by reforming audit methods and offering incentives to whistle-blowers.
We must learn from all this and acknowledge that deregulation promoted in the name of 'trusting' CEOs and creating a 'favourable investment climate' is dangerous.


Satyam fraud: More than accounting skullduggery

Raghuvir Srinivasan
Is the Satyam scandal just about a promoter manipulating the financial statements of his company to show a superior performance? Or is it about systematic siphoning of funds from the company over the years? Emerging events seem to increasingly point to the latter.
Let’s start with the so-called “confession statement” of Mr Ramalinga Raju, the disgraced chairman of the company. Lawyers have already expressed doubts over whether the statement can actually be deemed a confession and enough to implicate Mr Raju. Indeed, they say that it is a very well drafted document designed to draw attention to the hole in the finances without implicating himself anywhere for any act of commission.
Deflecting attention?
A careful reading of the statement shows that there is indeed merit in this view. Mr Raju has pointed to cash balances not being the same as reported in the audited financial statements, he has said of how revenues were inflated, and so on. But nowhere has he said that he was responsible for this nor has he pointed his finger at anyone else. Of course, as the chairman, the buck stops with him but that is not the same as saying “I did it”.
If anything, he has tried to project himself as the saviour by pointing out how he “arranged” Rs 1,230 crore for the company and how neither he nor the managing director “took even one rupee/dollar from the company and have not benefited in financial terms on account of the inflated results”.
Mr Raju appears to have attempted to deflect attention from what is possibly the more serious crime of siphoning of funds to the relatively lesser one of accounting skulduggery. This is being clever by half. How on earth did he think that the shareholders, lenders, legal agencies and the world at large would believe him on this?
People who were and are working in responsible positions in Satyam say that the company has a real business going and some of its divisions are extremely profitable and there is no question of doubting the revenues from them. There is no way that operating margin will be as low as 3 per cent, they say, unless of course, if money had been sucked out of the company.
The second event that raises doubts is the carefully orchestrated arrest of Mr Raju. He surrendered himself to the police the night before he was to appear before the SEBI investigating team. The arrest and remand ensured that SEBI was unable to interrogate him.
The market regulator will eventually be able to quiz him, but the question is: Will there be evidence destroyed before that? As it is, there is the possibility that Mr Raju may have destroyed crucial evidence implicating him before he went public with his “confession”.
Political angle
And then, there is the political angle to the scandal. Mr Raju and his companies (Maytas group) have been beneficiaries of large public contracts for transport systems and irrigation projects in Andhra Pradesh. Nexus between businessmen and politicians is an accepted reality in this country. So is someone powerful attempting now to protect Mr Raju? Or is it that he knows too much about wheeling-dealings and hence needs to be kept away from investigators?
Allegations and counter-allegations have been flying thick and fast from both the ruling and Opposition parties in Andhra Pradesh over favours, secured and shown, to Mr Raju by both. The government appointed board has a task on its hands. It will have to dig, and dig deep to unravel the scandal in all its dimensions. What is now out in public is probably just one dimension and it may be the least scandalous one. Mr Raju has himself said that the irregularities have been happening for years. Therefore, it is only correct to assume that more skeletons will come tumbling out once SEBI and the Company Law Board bury their noses into the books of Satyam.
There is the danger though that political pressure will be brought on to scuttle the investigations or obfuscate the findings. This is where the government-appointed board will assume importance. Not only will the government have to appoint people of integrity and high standing but these people will have to discharge their responsibility of getting to the bottom of this scandal without hesitation or fear.
ICAI to take stock
Finally, a word on the auditors, Price Waterhouse. The Central Council of the Institute of Chartered Accountants of India (ICAI), regulatory body of the accounting profession, is set to meet on Monday to take stock of the developments from the Satyam scandal on the profession.
Interestingly, two members of the Central Council, Mr S. Gopalakrishnan and Mr Harinderjit Singh, are senior partners of Price Waterhouse. Mr Gopalakrishnan signed the 2006-07 balance sheet of Satyam. Will the two gentlemen sit in on the deliberations on Monday at the ICAI? Or will they opt out on grounds of conflict of interest? Or better still, will they resign from the Central Council, which is the policy-making and governing body of the ICAI? Is it too much to ask for the last?
Source / courtesy: The Hindu


10 reasons why we don’t need GM foods

With the cost of food recently skyrocketing – hitting not just shoppers but the poor and hungry in the developing world – genetically modified (GM) foods are once again being promoted as the way to feed the world. But this is little short of a confidence trick. Far from needing more GM foods, there are urgent reasons why we need to ban them altogether.

1. GM foods won’t solve the food crisis

A 2008 World Bank report concluded that increased biofuel production is the major cause of the increase in food prices.[1] GM giant Monsanto has been at the heart of the lobbying for biofuels (crops grown for fuel rather than food) — while profiting enormously from the resulting food crisis and using it as a PR opportunity to promote GM foods!
“The climate crisis was used to boost biofuels, helping to create the food crisis; and now the food crisis is being used to revive the fortunes of the GM industry.” — Daniel Howden, Africa correspondent of The Independent[2]
“The cynic in me thinks that they’re just using the current food crisis and the fuel crisis as a springboard to push GM crops back on to the public agenda. I understand why they’re doing it, but the danger is that if they’re making these claims about GM crops solving the problem of drought or feeding the world, that’s bullshit.” – Prof Denis Murphy, head of biotechnology at the University of Glamorgan in Wales[3]

2. GM crops do not increase yield potential

Despite the promises, GM has not increased the yield potential of any commercialised crops.[4] In fact, studies show that the most widely grown GM crop, GM soya, has suffered reduced yields.[5]
A report that analyzed nearly two decades worth of peer reviewed research on the yield of the primary GM food/feed crops, soybeans and corn (maize), reveals that despite 20 years of research and 13 years of commercialization, genetic engineering has failed to significantly increase US crop yields. The author, former US EPA and US FDA biotech specialist Dr Gurian-Sherman, concludes that when it comes to yield, “Traditional breeding outperforms genetic engineering hands down.”[6]
“Let’s be clear. As of this year [2008], there are no commercialized GM crops that inherently increase yield. Similarly, there are no GM crops on the market that were engineered to resist drought, reduce fertilizer pollution or save soil. Not one.” – Dr Doug Gurian-Sherman[7]

3. GM crops increase pesticide use

US government data shows that in the US, GM crops have produced an overall increase, not decrease, in pesticide use compared to conventional crops.[8]
“The promise was that you could use less chemicals and produce a greater yield. But let me tell you none of this is true.” – Bill Christison, President of the US National Family Farm Coalition[9]

4. There are better ways to feed the world

A major UN/World Bank-sponsored report compiled by 400 scientists and endorsed by 58 countries concluded that GM crops have little to offer global agriculture and the challenges of poverty, hunger, and climate change, because better alternatives are available. In particular, the report championed “agroecological” farming as the sustainable way forward for developing countries.[10]

5. Other farm technologies are more successful

Integrated Pest Management and other innovative low-input or organic methods of controlling pests and boosting yields have proven highly effective, particularly in the developing world.[11] Other plant breeding technologies, such as Marker Assisted Selection (non-GM genetic mapping), are widely expected to boost global agricultural productivity more effectively and safely than GM.[12] [13]
“The quiet revolution is happening in gene mapping, helping us understand crops better. That is up and running and could have a far greater impact on agriculture [than GM].” – Prof John Snape, head of the department of crop genetics, John Innes Centre[14]

6. GM foods have not been shown to be safe to eat

Genetic modification is a crude and imprecise way of incorporating foreign genetic material (e.g. from viruses, bacteria) into crops, with unpredictable consequences. The resulting GM foods have undergone little rigorous and no long-term safety testing, but animal feeding tests have shown worrying health effects.[15] Only one study has been published on the direct effects on humans of eating a GM food.[16] It found unexpected effects on gut bacteria, but was never followed up.
It is claimed that Americans have eaten GM foods for years with no ill effects. But these foods are unlabeled in the US and no one has monitored the consequences. With other novel foods like trans fats, it has taken decades to realize that they have caused millions of premature deaths.[17]
“We are confronted with the most powerful technology the world has ever known, and it is being rapidly deployed with almost no thought whatsoever to its consequences.” — Dr Suzanne Wuerthele, US Environmental Protection Agency (EPA) toxicologist

7. Stealth GMOs in animal feed — without consumers’ consent

Meat, eggs and dairy products from animals raised on the millions of tons of GM feed imported into Europe do not have to be labelled. Some studies show that contrary to GM and food industry claims, animals raised on GM feed ARE different from those raised on non-GM feed.[18]  Other studies show that if GM crops are fed to animals, GM material can appear in the resulting products[19] and that the animals’ health can be affected.[20] So eating “stealth GMOs” may affect the health of consumers.

8. GM crops are a long-term economic disaster for farmers

A 2009 report showed that GM seed prices in America have increased dramatically, compared to non-GM and organic seeds, cutting average farm incomes for US farmers growing GM crops. The report concluded, “At the present time there is a massive disconnect between the sometimes lofty rhetoric from those championing biotechnology as the proven path toward global food security and what is actually happening on farms in the US that have grown dependent on GM seeds and are now dealing with the consequences.”[21]

9. GM and non-GM cannot co-exist

GM contamination of conventional and organic food is increasing. An unapproved GM rice that was grown for only one year in field trials was found to have extensively contaminated the US rice supply and seed stocks.[22] In Canada, the organic oilseed rape industry has been destroyed by contamination from GM rape.[23] In Spain, a study found that GM maize “has caused a drastic reduction in organic cultivations of this grain and is making their coexistence practically impossible”.[24]
The time has come to choose between a GM-based, or a non-GM-based, world food supply.
“If some people are allowed to choose to grow, sell and consume GM foods, soon nobody will be able to choose food, or a biosphere, free of GM. It’s a one way choice, like the introduction of rabbits or cane toads to Australia; once it’s made, it can’t be reversed.” – Roger Levett, specialist in sustainable development[25]

10. We can’t trust GM companies

The big biotech firms pushing their GM foods have a terrible history of toxic contamination and public deception.[26] GM is attractive to them because it gives them patents that allow monopoly control over the world’s food supply. They have taken to harassing and intimidating farmers for the “crime” of saving patented seed or “stealing” patented genes — even if those genes got into the farmer’s fields through accidental contamination by wind or insects.[27]
“Farmers are being sued for having GMOs on their property that they did not buy, do not want, will not use and cannot sell.” – Tom Wiley, North Dakota farmer[28]
India: Descent Into Darkness
By Colin Gonsalves
04 February, 2010
In the 61st year of the republic, surely, India has transited into Kalyug. Surveys of the Union of India as well as expert reports published by the Arjun Sengupta committee and the NC Saxena Committee appointed by the Central government reveal that almost 77 per cent of the population in India are below the poverty line in terms of the food intake minimum standard of 2,400 kilocalories (kcal) per person per day, a standard set by the Planning Commission in 1979.
Over 50 per cent of all women and children are malnourished with 17 per cent of the child population being so severely malnourished that a whole new generation of Indians will become adults with malformed brains and stunted growth. Even in the urban areas where conspicuous consumption is always on display, malnourishment of children is upwards of 50 per cent.
This is the spectre of starving India.
For the top 20 per cent of the population (and less than 3 per cent of the sensex/stock market) who have experienced the licence to loot, corrupt and cheat during the ongoing period of globalisation, this is Satyug. Since the beginning of the decline of Nehruvian social democracy in the early 1990s and the establishment of what is called the liberalisation regime, the rich have never had it so good.
A seismic shift has taken place in the thinking of politicians, corporations, administrators and judges, fuelled partly by international capital and the devious planning of the World Bank and the IMF. Whereas earlier and in accordance with the constitutional mandate, the country was to be taken along as a whole, the resources of the State were to be used to subserve the common good and a reasonable part of the gross domestic product (GDP) was to be kept aside to subsidise education, health, food, housing and transportation for the working people. With globalisation all this began to change drastically, systematically and with abject cold-blooded deliberation.
Education for all was quickly jettisoned with the argument that it is impossible to educate so many poor children, that it is inadvisable and unproductive to spread resources thinly and that since in any case the middle classes are the engines of change, State resources ought to be concentrated on them if the GDP is to be pushed up. Thus, while fancy educational institutions multiply and students’ fees rise many times over, poor students learn under trees or in the open (in freezing cold or scorching summer) without schools, textbooks and often without teachers and the officially promised mid-day meals.
The Supreme Court in TMA Pai’s case, made a disgraceful decision opening the doors for commercialisation and privatisation of education and casting a shadow on the earlier decision in Unnikrishnan’s case correctly providing for strict State regulation and prohibition on commercialisation.
Similarly, while some of the finest health facilities in the world sprung up in the cities of India, government public health facilities went into a tailspin. The public health centers lacked medicines, doctors, testing equipment, beds and food for poor patients. As the despair with public health care is increasing, the World Bank merrily came along with its prescription for “user fees” requiring people below the poverty line to pay for health services. Dalit or poor women delivering on the pavements outside government hospitals became a common sight.
Despite the jurisprudential exhortation that the right to public health care, free drugs and indigenously manufactured medicines is a fundamental right under Article 21 of the Constitution, the rot set in and is too deep to reverse. How does it matter and what effect could it possibly have on the GDP if tens of thousands of poor people suffer ill health or die of malaria or tuberculosis? From the GDP point of view, health care for the poor simply does not matter.
The shift in ideology away from social democracy towards what was quaintly called ‘globalisation’ affected the judiciary as well. Senior judges who were derisive of the post-independence emphasis on ‘egalitarian socialism’ used the enormous power of the judiciary to undermine social policies of the government, bypass binding precedents and generally stripped the working people of constitutional law protections.
In the Steel Authority of India Limited case, the Supreme Court made it possible for capitalists to convert their entire labour force into contractual labour, thus effectively taking away all their protection under labour laws. In Uma Devi’s case, persons who were employed and were working for decades in permanent work positions on a pittance, were denied regularisation, thus giving a legal cover to slave labour.
Marvelous environmental jurisprudence meticulously put in place by Justice Kuldeep Singh and others in the Supreme Court was systematically dismantled by subsequently appointed judges in the superior courts who had a pro-capitalist bend of mind. They saw environmental law and environmental activism as an irritant which hindered the ‘development’ of the country. They, therefore, used the quite dubious doctrine of ’sustainable development’ in an even more suspect way to allow for all kinds of environmentally destructive industrial activity, quite unmindful of its catastrophic and long-term effect on the environment.
As a result, India today is in the process of being completely devastated. The forests have been decimated in many parts indiscrimately for big projects, the cities are polluted, lush green areas have been mined, the rivers of India turned into sewage drains and water shortage has become so acute that in the years to come social upheavals will centre around this acute deprivation. The great Indian nation is being turned into a desert with its sacred rivers becoming dirty drains.
When the tribals, dalits, workers, slum dwellers and the dispossessed of this country protested, often feebly, they were met with fierce repression. Police torture is widespread and has become the principle forensic tool for the investigation of crimes. Nowhere in the world, perhaps, has the police force turned into such an awesome body of ruthless creatures in uniform, as in India.
The average rate of conviction in the country in cases of atrocities against Dalits has sunk to 1 per cent. As a result, rape of Dalit women, murder of Dalits, destruction of their houses, burning of standing crops, robbing of cattle, destruction of Dalit temples, throwing excreta inside wells, untouchability and practices such as the two tumbler system, continues unchecked till this day while the justice system seems immune.
Despite the right to housing being declared a fundamental right by the Supreme Court in Nawab Khan’s case and although the UPA manifesto specifically includes a ban on forced evictions of slums, about a million of the urban poor every year have their homes bulldozed without notice, compensation or rehabilitation to make way for the skyscrapers of the rich.
All this does not auger well for the legal system in India, one of the main pillars of the democratic State. The working people shy away from the courts and participate reluctantly when they are dragged into the legal system through coercive proceedings. Labour court proceedings throughout the country have shrunk by 75 per cent and the once vibrant institutions that balanced the interests of capital and labour have become stultified. Tribals shun the courts. Even the most serious of crimes like rape and murder make the victims approach the courts with grave reluctance.
This is not difficult to understand as the legal system operates just like a colonial power, as an engine of oppression. Probably, one million false or trivial cases are pending in the Indian courts against innocent tribals who are forced to attend court and loose their wages day after day. It took a Maoist uprising for PC Chidambaram, the Union Home Minister, to understand this elementary truth and announce the withdrawal of one lakh cases filed by the State against tribals in Jharkhand alone.
Decisions of the Supreme Court under the Land Acquisition Act have made possible tyrannical state acquisitions of land throughout the country making the vast majority of Indian farmers suspicious of the legal system. With regard to as elementary and established a right as a woman’s right to maintenance, the woes of women in family court matters seems never ending.
The State just can’t get its act together to enforce the appointment of judges although it is now well settled that India has one fifth the number of judges that it needs. Delays are not accidental, they are intended. The legal system is designed to tie the litigant up in endless and expensive proceedings where justice is illusory.
Public Interest Litigation, which is the only lifeline between the judiciary and the people of India, is being denigrated time and again and not unexpectedly because there are those who believe that the legal system is best used for sorting out property disputes and commercial matters. Legal aid has been reduced to a farce of seminars with the presentation of bouquets. In death sentence cases involving destitute persons, the legal aid lawyer may even miss a cross examination or two.
It is sometimes all too easy to blame judges for the ills of the legal system. If one turns to the quality of the Bar, one would notice all kinds of elements wearing bands and gowns and committing all kinds of illegalities. Criminality pervades many parts of the legal system.
Between democracy and darkness stands the judiciary. It stands heads and shoulders above the judicial systems in Asia. But it is in rapid decline. Ahead is pitch darkness.
This is the period of Kalyug. The lust for money that globalisation brought with it has decisively depleted spirituality, morality, collective sharing, equality and social justice. It has only institutionalised a spiraling network of stark and relentless injustice. Only a national uprising will reverse this trend.
[The writer is a senior lawyer, Supreme Court of India, and Founding-Director, Human Rights Law Network]

An appeal to Government of USA

Dear Madam / sir ,

Subject :  Follow the law- counter terror with justice

I welcomed President Obama's executive orders to close Guantanamo and end the use of torture. Further, I welcome the appointment of a Special Prosecutor to investigate a number of cases of detainee abuse as a positive step toward accountability. However, I am deeply concerned that human rights violations -- and impunity for human rights violations -- continue. This in spite of the fact that human rights violations are immoral, illegal and -- according to military and intelligence experts -- ineffective and counterproductive.

There is an alternative. I am writing to urge you to respect human rights, follow the law and counter terror with justice:

- Ensure accountability for torture and abuse, as required by law. Set up or support an independent commission of inquiry to investigate torture and other human rights violations committed by the U.S. government in the name of countering terrorism; ensure that all those who break the law are prosecuted; and ensure redress and remedy to victims;

- Reject indefinite detention and unfair military commissions. Guantanamo detainees must either be charged with a crime and fairly tried in U.S. federal court, without recourse to the death penalty, or be released, to countries where their human rights will be respected;

- Bring U.S. detentions at Bagram and other U.S. facilities in Afghanistan and Iraq into compliance with international law and human rights standards;

- Close all possible loopholes for torture and other ill-treatment, and end any use of rendition and secret detention by or on behalf of the U.S. authorities anywhere.

The U.S. government is required by law to respect human rights and to ensure accountability for human rights violations. I call on you to follow the law.

Your’s sincerely ,

An appeal to Government of USA

Dear Madam / Sir,

Subject : Review Gitmo policies of indefinite detention

I want you to establish an independent, bipartisan commission that will examine, report, and come to its own informed conclusions about the policies and practices related to the detention, treatment, and transfer of Guantanamo detainees.

I am outraged that a Justice Department-led task force recently recommended that the U.S. continue holding nearly 50 Guantanamo detainees indefinitely.

These conclusions are in direct violation of civil liberties, human rights, and a Supreme Court ruling in 2008 that confirmed Guantanamo detainees' rights to habeas corpus. We were promised that by this date the infamous detention center would be closed, instead the Administration is considering prolonging the violation of detainees' rights. We can't keep America safe by perpetuating injustice.

Please help establish and support a non-partisan, independent commission of distinguished Americans to finally close the chapter on the war on terror and examine the detention, treatment, and transfer of Guantanamo detainees.  Such a commission needs to be independent, backed by the full force of law, and be adequately funded.

We can't continue to detain people on the basis of rumor and innuendo. If there is information then the American people deserve to be told the truth.

I would like you to ensure that the Administration produces and publishes all remaining relevant policy memos that argued for, documented, and established the basis for coercive interrogation, detainee treatment and policy in the last administration. It is important that we expose these ongoing human rights violations and take action to ensure that these abuses do not happen again. Please let me know the steps you're taking to restore justice and rule of law at Guantanamo.

Your’s sincerely,

The Corporate Takeover Of U.S. Democracy
By Noam Chomsky
04 February, 2010
In These Times
Jan. 21, 2010, will go down as a dark day in the history of U.S. democracy, and its decline.
On that day the U.S. Supreme Court ruled that the government may not ban corporations from political spending on elections—a decision that profoundly affects government policy, both domestic and international.
The decision heralds even further corporate takeover of the U.S. political system.
To the editors of The New York Times, the ruling “strikes at the heart of democracy” by having “paved the way for corporations to use their vast treasuries to overwhelm elections and intimidate elected officials into doing their bidding.”
The court was split, 5-4, with the four reactionary judges (misleadingly called “conservative”) joined by Justice Anthony M. Kennedy. Chief Justice John G. Roberts Jr. selected a case that could easily have been settled on narrow grounds and maneuvered the court into using it to push through a far-reaching decision that overturns a century of precedents restricting corporate contributions to federal campaigns.
Now corporate managers can in effect buy elections directly, bypassing more complex indirect means. It is well-known that corporate contributions, sometimes packaged in complex ways, can tip the balance in elections, hence driving policy. The court has just handed much more power to the small sector of the population that dominates the economy.
Political economist Thomas Ferguson’s “investment theory of politics” is a very successful predictor of government policy over a long period. The theory interprets elections as occasions on which segments of private sector power coalesce to invest to control the state.
The Jan. 21 decision only reinforces the means to undermine functioning democracy.
The background is enlightening. In his dissent, Justice John Paul Stevens acknowledged that “we have long since held that corporations are covered by the First Amendment”—the constitutional guarantee of free speech, which would include support for political candidates.
In the early 20th century, legal theorists and courts implemented the court’s 1886 decision that corporations—these “collectivist legal entities”—have the same rights as persons of flesh and blood.
This attack on classical liberalism was sharply condemned by the vanishing breed of conservatives. Christopher G. Tiedeman described the principle as “a menace to the liberty of the individual, and to the stability of the American states as popular governments.”
Morton Horwitz writes in his standard legal history that the concept of corporate personhood evolved alongside the shift of power from shareholders to managers, and finally to the doctrine that “the powers of the board of directors “are identical with the powers of the corporation.” In later years, corporate rights were expanded far beyond those of persons, notably by the mislabeled “free trade agreements.” Under these agreements, for example, if General Motors establishes a plant in Mexico, it can demand to be treated just like a Mexican business (“national treatment”)—quite unlike a Mexican of flesh and blood who might seek “national treatment” in New York, or even minimal human rights.
A century ago, Woodrow Wilson, then an academic, described an America in which “comparatively small groups of men,” corporate managers, “wield a power and control over the wealth and the business operations of the country,” becoming “rivals of the government itself.”
In reality, these “small groups” increasingly have become government’s masters. The Roberts court gives them even greater scope.
The Jan. 21 decision came three days after another victory for wealth and power: the election of Republican candidate Scott Brown to replace the late Sen. Edward M. Kennedy, the “liberal lion” of Massachusetts. Brown’s election was depicted as a “populist upsurge” against the liberal elitists who run the government.
The voting data reveal a rather different story.
High turnouts in the wealthy suburbs, and low ones in largely Democratic urban areas, helped elect Brown. “Fifty-five percent of Republican voters said they were `very interested’ in the election,” The Wall St. Journal/NBC poll reported, “compared with 38 percent of Democrats.”
So the results were indeed an uprising against President Obama’s policies: For the wealthy, he was not doing enough to enrich them further, while for the poorer sectors, he was doing too much to achieve that end.
The popular anger is quite understandable, given that the banks are thriving, thanks to bailouts, while unemployment has risen to 10 percent.
In manufacturing, one in six is out of work—unemployment at the level of the Great Depression. With the increasing financialization of the economy and the hollowing out of productive industry, prospects are bleak for recovering the kinds of jobs that were lost.
Brown presented himself as the 41st vote against healthcare—that is, the vote that could undermine majority rule in the U.S. Senate.
It is true that Obama’s healthcare program was a factor in the Massachusetts election. The headlines are correct when they report that the public is turning against the program.
The poll figures explain why: The bill does not go far enough. The Wall St. Journal/NBC poll found that a majority of voters disapprove of the handling of healthcare both by the Republicans and by Obama.
These figures align with recent nationwide polls. The public option was favored by 56 percent of those polled, and the Medicare buy-in at age 55 by 64 percent; both programs were abandoned.
Eighty-five percent believe that the government should have the right to negotiate drug prices, as in other countries; Obama guaranteed Big Pharma that he would not pursue that option.
Large majorities favor cost-cutting, which makes good sense: U.S. per capita costs for healthcare are about twice those of other industrial countries, and health outcomes are at the low end.
But cost-cutting cannot be seriously undertaken when largesse is showered on the drug companies, and healthcare is in the hands of virtually unregulated private insurers—a costly system peculiar to the U.S.
The Jan. 21 decision raises significant new barriers to overcoming the serious crisis of healthcare, or to addressing such critical issues as the looming environmental and energy crises. The gap between public opinion and public policy looms larger. And the damage to American democracy can hardly be overestimated.
Noam Chomsky is Institute Professor & Professor of Linguistics (Emeritus) at the Massachusetts Institute of Technology, and the author of dozens of books on U.S. foreign policy.

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