Profiting
From Destruction
t r u t h o
u t
09 June 2003
Bechtel Group Inc., one
of the lead contractors in the reconstruction of Iraq, has a 100-year
history of capitalizing on environmentally unsustainable technologies
and reaping immense profits at the expense of societies and the environment,
said a report released today by Public Citizen, Global Exchange and
CorpWatch. Its release was timed to coincide with a day of direct actions
around the country to protest Bechtels presence in Iraq, the report
concludes that the Bush administration must be stopped from doling out
contracts to undeserving firms with which it has close ties, including
Bechtel and Halliburton.
The report,
Bechtel: Profiting from Destruction, provides case studies from
Bechtels history of operations in the water, nuclear, energy and
public works sectors. It documents a track record by Bechtel of environmental
destruction, disregard for human rights and financial mismanagement
of projects that has affected communities all over the world and does
not bode well for the people of Iraq.
"If environmental and consumer protection violations had been taken
into account, Bechtel would not have been awarded such an important
contract in Iraq," said Sara Grusky, senior organizer with Public
Citizen. "The American people are funding this contract through
their tax dollars but are being denied the right to see what their money
is supporting."
On April 17, Bechtel was
awarded $34.6 million of an 18-month Iraq reconstruction contract worth
up to $680 million, including the rehabilitation, reconstruction and
expansion covering all key elements of Iraqs infrastructure, including
electrical grids, water and wastewater systems. The contract was part
of a limited bidding process that forbade public review and was kept
secret even from Congress.
"This contract is about
profit-making, not humanitarian efforts," said Maria Elena Martinez,
executive director of CorpWatch. "The Iraqi people are in desperate
straits thanks to the U.S. government, and now a U.S. company stands
to make hundreds of millions of dollars. It exemplifies the typical
revolving door between big business and government - in this case, Bechtels
board members and our high-ranking government officials."
A historical look at Bechtels
wrongdoings includes:
In Papua New Guinea,
Bechtel partnered in constructing the worlds largest gold mine
in 1970. The mine daily dumps hundreds of thousands of tons of toxic
waste from the mining operations directly into local rivers. In 2000,
a waste dump accident resulted in four deaths.
Environmental and
human rights groups have charged that Bechtel, in a partnership with
Shell called InterGen, circumvented U.S. environmental laws by building
a power plant on the Mexican border for the sole purpose of exporting
energy to the United States. The La Rosita InterGen plant located in
Mexicali, Baja Calif., and partly owned by Bechtel, was the subject
of a May 6, 2003, court ruling that found that the U.S. Department of
Energy and Bureau of Land Management had acted illegally in granting
permits to InterGen to build this power plant.
In Cochabamba, Bolivia,
in 1999, Aguas del Tunari, a subsidiary of Bechtel, provoked protests
that shut down the city when it privatized the citys water system,
then implemented massive price hikes that left many people unable to
afford water. The United Nations has formally declared water to be a
human right - Bechtel violated this international resolution when it
deprived people of their right to water. The outcry forced the Bolivian
government to cancel Bechtels contract; Bechtel is now suing the
country in a World Bank court for $25 million in lost profits.
At nuclear power plants
in Palisades, Mich.; Humboldt Bay, Calif.; Three Mile Island, Penn.;
San Onofre, Calif., and Davis-Besse, Ohio, Bechtel was involved in some
of the U.S. commercial nuclear industrys more notable mishaps.
In Nevada, Bechtel
was awarded the management contract for a proposed nuclear waste repository
at Yucca Mountain, a site considered sacred by the Western Shoshone
people and part of a decades-long land dispute between the United States
government and the Native Americans. On these same lands, Bechtel manages
a Nevada test site and counterterrorism facility where nuclear, biological
and chemical weapons construction and testing are carried out. The operation
of the facility and its environmental and health effects have prompted
ongoing protests from Native Americans, environmental and disarmament
advocates.
In Boston, Bechtels
mismanagement and cost overruns have been unprecedented. Bechtel designed
and manages the Boston Central Artery tunnel project, also known as
"the Big Dig." This federally funded project is the most costly
civil engineering undertaking in U.S. history; estimated at $2.5 billion
in 1985, it reached $14.6 billion in 2003.
In San Francisco in 2002,
the Board of Supervisors phased out a contract with Bechtel for the
management of the upgrade of the citys water systems before its
completion date. Bechtel was charged with doing unnecessary and overpriced
work and charging the city for tens of thousands of dollars worth
of personal expenses.
The report also documents
Bechtels history in Iraq, where the company was pushing for an
oil pipeline deal in the 1980s at the same time that Saddam Hussein
was committing his worst atrocities against the Iraqi people. Bechtel
was named by Husseins government as one of the U.S. companies
that provided it with materials that could be used to make weaponry.
"Bechtel has demonstrated
brazen moral corruption by first contributing to the development of
Iraqs weapons, then pushing for a war against Iraq, and finally
profiting from the tragedy and destruction wrought by that war,"
said Andrea Buffa, peace campaign coordinator at Global Exchange. "It
is a textbook example of what war profiteering looks like. This report
answers the question What's wrong with Bechtel? "
The reports recommendations
include:
Implementing a democratic
reconstruction in Iraq, led by the Iraqi people with the help of international
institutions like the United Nations.
Opening up and making
transparent the bidding process for U.S. government contracts in Iraq
and elsewhere.
Companies bidding
for U.S. government contracts should have satisfactory records of integrity
and business ethics.