Americans may have initially felt a bit smug upon learning that the combustible material responsible for the Grenfell Tower disaster in London is largely banned in the United States. Perhaps our regulatory system is not as deficient as we thought.
That moral superiority went out the window when it came to light that the deadly cladding was purchased from an American-based company. Some of the outrage being exhibited toward public officials in Britain should also be aimed at Arconic, a company created from the break-up of the aluminum giant Alcoa. Arconic has announced that it will suspend sales of the cladding, known as Reynobond PE, for high-rises, but that does little good for the scores of people killed in the Grenfell fire or the thousands of others who have been forced to leave other apartment houses now found to contain the material.
Although most of the attention is on Arconic’s cladding and its role in spreading the conflagration, it turns out that fire itself was caused by another American product, a refrigerator made by Whirlpool under its Hotpoint brand. The appliance had a back made out of flammable plastic rather than the metal typically used in models sold in the United States. The London Fire Brigade had long lobbied, to no avail, to require new appliances to have fire-resistant backing.
The sale of banned products in offshore markets is, unfortunately, a longstanding practice among U.S-based multinational corporations. What’s unusual in this case is that the offshore market is a wealthy country such as Britain, whereas the dumping is normally done in poor countries.
As Russell Mokhiber points out in his 1988 book Corporate Crime and Violence, one of the earliest examples was that of the now defunct company A.H. Robins, which in the 1970s sold thousands of its Dalkon Shield intrauterine contraceptive devices in 42 countries even after it became apparent that thousands of U.S. women were experiencing severe and sometimes deadly ailments linked to the IUDs.
In 1972 the U.S. Environmental Protection Agency prohibited most uses of the insecticide DDT, yet American producers continued to sell in foreign markets for years until most other countries adopted their own bans.
U.S. companies also continued to export dangerous products such as asbestos, flammable children’s pajamas and lead-based house paint after being barred from selling them in domestic markets.
These practices illustrate the perverse way that most large companies regard the regulation of their business. They are not willing to admit that restrictions are legitimate — even when imposed in the wake or injuries and deaths — and will adhere to them only to the extent absolutely necessary. If they can continue to sell products they have been told are harmful to some customers, they will do so.
This mindset seems to result from both a knee-jerk ideological opposition to all regulation and an amoral pursuit of profits. The persistence of corporate crime suggests that attempting to reform big business from within — the dubious promise of corporate social responsibility — is far from adequate. Just as markets have superseded borders, so must regulation be globalized.
For months the news has been filled with reports of suspicious meetings between Trump associates and Russian officials. Another category of meetings also deserves closer scrutiny: the encounters between Trump himself and top executives of scores of major corporations since Election Day. What do these companies want from the new administration?
Lurking behind the assault on regulation being carried out by the Trump Administration and its Congressional allies is the assumption that corporations, freed from bureaucratic meddling, will tend to do the right thing. That assumption is belied by a mountain of evidence that companies, if allowed to pursue profit without restraint, will act in ways that harm workers, consumers and communities. In fact, they will do so even when those restraints are theoretically in effect.
Several weeks ago, in one of his few legislative successes, President Trump signed a bill rescinding the Obama Administration’s executive order on Fair Pay and Safe Workplaces. The order, designed to promote better employment practices by companies doing business with the federal government, instructed procurement officials to consider the labor track record of contractors, which were required to disclose their recent violations.
Given his own string of business controversies, it perhaps should come as no surprise that Donald Trump does not seem to worry much about the accountability track record of the companies from which he has recruited key members of his administration.
Once upon a time, a key component of American populism was the demand for stricter controls over big business: in other words, regulation. Today, the country’s purported populist in chief is instead promoting the dubious claim that deregulation is what will benefit the masses. Through executive orders and now with his administration’s
Executives at Volkswagen must be cursing the bad timing. If only they had been able to keep their emissions cheating scheme quiet for a while longer, they could have avoided a lot of grief. That’s because the U.S. Environmental Protection Agency’s enforcement capacity may soon be crippled.
Since the beginning of 2010 the Equal Employment Opportunity Commission has resolved more than 200 cases of workplace discrimination based on race, religion or national origin and imposed penalties of more than $116 million on the employers involved.
Trump’s travel ban and his rightwing Supreme Court pick are troubling in themselves, but they are also serving to deflect attention away from the plot by the administration and its Republican allies to undermine the regulation of business.
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