Corporations and Public Health:Profits Before People
Martin Donohoe
Am I Stoned?
A 1999 Utah anti-drug pamphlet warns:
“Danger signs that your child may be smoking marijuana include excessive preoccupation with social causes, race relations, and environmental issues”
Corporations Dominate the Global Economy
Almost 6 million corporations90% of transnational corporations
headquartered in Northern Hemisphere
500 companies control 70% of world trade
Corporations Dominate the Global Economy
• 53 of the world’s 100 largest economies are private corporations; 47 are countries
–Wal-Mart is larger than Israel and Greece
The Stock Market
• The top 1% of Americans owns 51% of all stocks, bonds, and mutual fund assets
• Consequences of Differential Stock Ownership–Corporations are answerable to their
shareholders–Governments are answerable (at least in
theory) to their citizens (either through elections or revolutions)
Corporations
• Internalize profits
• Externalize health and environmental costs
Corporate Taxation
• Corporations shouldered over 30% of the nation’s tax burden in 1950 vs. 8% today• Nearly 1/3 of all large U.S.
corporations pay no annual tax
Corporate Taxation
• Big business claims that U.S. corporations pay the highest corporate taxes in the world (35%)
• FALSE: The rate actually paid, after foreign governments get their cuts, money sent to foreign subsidiaries, loopholes, etc. = 2.3% (U.S. Treasury Department)
Reasons for Inadequate Corporate Taxation
• Corporate tax breaks/loopholes
• Corporate welfare
• Cheating and under-payment common
• Offshore tax havens shelter capital
Ugland House, Cayman Islands18,000 Corporations Registered Here
Job Creators?
Corporate Taxation
• 2004: Bush administration offered temporary tax holiday on foreign earnings–$300 billion in profit repatriated• 92% went to dividend payouts, stock
buybacks, and corporate coffers• Only 8% went to R and D, new factories,
and hiring
Exorbitant CEO Pay
• CEO salaries up 759% since 1978– Average worker pay up 6%
• The average CEO makes 350-400X the salary of the average U.S. worker (1960 - 41X)– Mexico 45:1– Britain 25:1– Japan 10:1– US Military: 20:1 (top rank : lowest rank)
Corporate PR Tactics
• Advertising– “The art of convincing people to spend money
they don't have for something they don't need.“ (Will Rogers)
• Astroturf - artificially-created grassroots coalitions• Corporate front groups• Invoke poor people as beneficiaries
Corporate PR tactics
• Characterize opposition as “technophobic,” anti-science,” and “against progress”
• Portray their products as environmentally beneficial despite evidence to the contrary
• Corporate espionage: spying, bribes
Greenwash
• Public relations / ad campaigns–BP invests $100 million annually in
clean energy = amt. it spends annually to market itself as moving “Beyond Petroleum”
Sponsored Environmental Education Materials (Examples)
International Paper-“Clearcutting promotes growth of trees that require full sunlight and allows efficient site preparation for the next crop”
Exxon’s “Energy Cube”-“Gasoline is simply solar power hidden in decayed matter”-“Offshore drilling creates reefs for fish”
Academics/Professional Organizations Affected
• Increasing corporatization of academia–↑Private commercial funding of
university research–Secrecy/Gag Clauses
• For-profit colleges growing, marked by corruption, high interest rates on loans to the un- and under-qualified
Academics/Professional Organizations Affected
• Dramatic decrease in tenured faculty, rise in administrators
• Gagging of researchers at federal agencies demoralizing, can affect recruitment of quality scientists
The Media
• 5 corporations control majority of US media (down from 50 in 1983)
• Extensive corporate-media links
• American Council on Science and Health
Global Warming: Controversial?
• Of 928 articles in peer-reviewed scientific journals, none were in doubt as to the existence or cause of global warming
• Of 636 articles in the popular press (NY Times, Washington Post, LA Times, WSJ), 53% expressed doubt as to the existence (and primary cause) of global warming
Science 2004;306:1686-7(Study covers 1993-2003)
Lobbying
• Approximately 40,000 lobbyists (12,600 full-time)
• Estimates of return on lobbying range from $28 to $100 for every $1 spent
Lobbying
• Corporate federal lobbying groups spent 3.5 billion in 2010 (3.3 billion in 2011)
• All single issue ideological groups combined (e.g., pro-choice, anti-abortion, feminist and consumer organizations, senior citizens, etc.) = $76 million (2010)
Top-Spending Industries, 2011(Low Estimates)
• Pharmaceutical industry - $236 million• Insurance industry - $158 million• Oil and gas industry - $146 million• Electric utilities - $144 million
Campaign Cash and Lobbying
• Citizens United
• Lobbying promotes international non-cooperation/isolationism
The alliance between GE Medical Systems and NY-Presbyterian
Hospital
General Electric
• Ranked by Forbes as world’s largest company (based on equal weighting of sales, profits, assets, and market value)
• 2012 revenues of $145 billion– Close to the GDP of more than 2/3 of U.N.
member states2012 net after-tax profits of $15 billion
• Just over 1/3 from U.S. operations
General Electric
• Makes household appliances, lighting, and medical equipment–Plastics division, which produced
bisphenol A, spun off in 2008
• Produces jet engines and military hardware
General Electric
• Charles Wilson (CEO of GE pre- and post-WW II; helped oversee U.S. military production during WW II):– “The revulsion against war…will be an almost
insuperable obstacle for us to overcome. For that reason, I am convinced that we must begin now to set the machinery in motion for a permanent wartime economy.”
General Electric
• Has built 91 nuclear power plants in 11 countries (including the troubled Fukushima Daishi plants in Japan)–Including 23 plants at 11 sites in U.S.• e.g., Hanford
–¼ of GE’s US reactors found to be defective
General Electric
• Operates coal-burning power plants–Major releasers of toxic mercury
• Produces nearly 40 technologies used in fracking–Increasing investments in fracking
General Electric
• Operates a large financial services group– Responsible for over 50% of company’s profits in
recent years
• Until recently, owned 49% of a multi-billion dollar media empire– Including NBC, Telemundo, and Universal Studios– Comcast owned 51%; bought out GE in 2013
GE’s History
• Conducted unethical human subject experiments on prisoners, involving testicular irradiation, from 1940s to 1960s• Intentionally-released excessive radiation
from its Hanford, WA nuclear reactor in the 1980s, to determine how far it would travel
GE’s Record
• Sued radiologist who brought to light dangers of GE’s contrast agent, Omniscan– Causes nephrogenic systemic fibrosis (FDA black
box warning)• Ordered to pay $11.4 million to Bracco
Diagnositcs for falsely/misleadingly claiming that its x-ray contrast agent Visipaque was superior to BD’s Isovue
GE’s Record
• America’s largest corporate polluter
• 116 Superfund sites nationwide
• Approximately 13 in NY
GE’s Record
• Between 1947 and 1977, two of its capacitor manufacturing plants dumped 1.3 million pounds of PCBs into the Hudson River–Probable human carcinogens with adverse
effects on liver, kidney, nervous system, and reproductive organs (EPA)–200 mi of Hudson = Superfund site
GE’s Record
• Eliminated 34,000 US jobs between 2000 and 2010
• Added 25,000 overseas jobs over same period–One of nation’s top out-sourcers of
jobs
GE’s Record
• Cited by Human Rights Watch for “systematic workers’ rights violations” in the U.S. and abroad
• Extensive record of tax violations, military procurement fraud
GE CEO Jeffrey Immelt
• 2012 total compensation = $25.8 million
• Named “World’s Best CEO” in 3 separate Barron’s polls
• 2006 - 2011 - On Board of NY Federal Reserve Bank
GE CEO Jeffrey Immelt
• 2008 – Named one of the “100 Most Influential People in the World” by TIME Magazine
• 2009 - Appointed by President Obama to his Economic Recovery Board– GE then became eligible, via a loophole, for ¼ of
the $340 billion Temporary Liquidity Guarantee Program (debt support)
GE CEO Jeffrey Immelt
• 2011 - Appointed by Obama as Chair of his outside panel of Economic Advisors and of his Council on Jobs and Competitiveness
• On the board of directors of “The Robin Hood Foundation”!
GE’s Record
• Named “America’s Most Admired Company” by Forbes• Named one of the “World’s Most
Respected Companies” in polls conducted by Barron’s and The Financial Times
Concerns About the Agreement between GE Medical Systems and NY-Presbyterian Hospital
(2003)
• Provides GE with financial incentives to promote high technology purchases
• Hospital prohibited from purchasing more effective equipment from other companies
Concerns About the Agreement
• Augments trend in academic medical centers to promote the use of expensive, high-technology care at expense of preventive care and public health measures–Highly reimbursable– Services may be redundant in certain
locations
Concerns About the Agreement
• Patients with developmental anomalies and cancers caused by GE’s pollution diagnosed with GE scanners and treated with GE-manufactured therapeutic devices, increasing GE’s profit
A macabre twist on “cradle to grave care”
Solutions
• NY-P should cancel agreement• Health care providers and organizations
should condemn this alliance• Medical and ethical organizations should
develop standards regarding future agreements
Health Insurance Industry
• Dubious practices:– Delisting– Cherry picking– Pre-existing conditions
• Often lower quality of care• High administrative costs– 15-30% (vs. 2-3% for Medicare and Medicaid)
Health Insurance Industry
• Large profit margins
• Loyalty: shareholders (not patients)
• Corruption
Pharmaceutical Industry
• Influence over physicians through control of CME, gifts, research funding–Physician Payments Sunshine Act –
reporting requirements• Conduct seeding trials to alter prescribing
patterns• Secrecy, statistical torturing of data sets,
selective publication
Pharmaceutical Industry
• Data mining of prescribing practices–OK’d by SCOTUS in Sorrell v. IMS Health
• Unethical trials in developing world
• Poor compliance with Clinical Trials Registry rules
Drug Company Malfeasance
• The pharmaceutical industry is the biggest defrauder of the federal government, as determined by payments made for violations of the federal False Claims Act (FCA)–Accounted for 25% of all FCA payouts
between 2000 and 2010–Defense industry – 11%
Pharmaceutical Industry
• $240 million dollars spent on lobbying in 2011–1,228 lobbyists (2.3 for every member
of Congress)–Revolving door between legislators,
lobbyists, executives and government officials
Pharmaceutical Industry
• Effectively lobbied and threatened trade sanctions against developing countries in order to prevent production and importation of much cheaper, generic versions of life-saving anti-AIDS drugs
• Patent extensions
PPACAPatient Protection and Affordability Care Act
• Career arc of Elizabeth Fowler (architect of plan):– VP for Public Policy and External Affairs (informal
lobbying) at WellPoint (nation’s largest insurer)– Chief health policy counsel to Senator Max Baucus
(who drafted legislation)– Head of Global Health Policy at pharmaceutical
giant Johnson and Johnson
Solutions
• Restructure tax system• Punish corporate scofflaws with large
fines and jail time• Increase enforcement budgets to combat
corporate crime
Solutions
• Eliminate confidential legal settlements and confidential business information relevant to public health and safety
• Eliminate mandatory binding arbitration clauses
Solutions
• Living wage laws• Work with corporations–Healthy PR–Shareholder activism–Risks/benefits
Solutions: Fair, Representative Elections
• Publicly financed campaigns and campaign finance reform
• Overturn Citizens United• Proportional representation• Instant runoff voting• Halt disenfranchisement, overturn voter
restriction laws• Vote
Solutions
• Activism / Letter writing / Protesting / Whistleblowing
• Work in groups
• Lobby legislators
• Run for office
Solutions
• Increase funding of public education
• Independent scientific review of school curricula
• Prohibit use of sponsored curricula
Solutions
• Establish safeguards re corporate involvement in academic research
• Higher standards of journalism
• Support alternative media
Solutions
• Augment and improve international aid package– 0.9% of the total federal budget, 1.6% of the
discretionary budget– Charitable giving approximately $250 billion/year
(2.5% of income vs. 2.9% at height of Great Depression)
• Sign, ratify, and adhere to major international treaties
Solutions
• Based on Precautionary Principle• Recognize nature’s net worth• Measure prosperity based on Genuine
Progress Index or Global Happiness Index, rather than Gross Domestic Product
• “All men are created equal”–Declaration of Independence
• “Some people are more equal than others”–George Orwell
Voltaire
“The comfort of the rich rests upon an abundance of the poor”
Hudson River, 2009
Primo Levi
“A country is considered the more civilized the more the wisdom and efficiency of its laws hinder a weak man from becoming too weak or a powerful one too powerful.”
Günter Grass
“The first job of a citizen is to keep your mouth open.”
African Proverb
If you think you are too small to have an impact, try going to bed with a mosquito in your tent
Contact Information and References
Public Health and Social Justice Website
http://www.publichealthandsocialjustice.org
http://[email protected]