RACHEL’s Hazardous Waste News #122

=======================Electronic Edition========================

RACHEL’S HAZARDOUS WASTE NEWS #122
—March 28, 1989—
News and resources for environmental justice.
——
Environmental Research Foundation
P.O. Box 5036, Annapolis, MD 21403
Fax (410) 263-8944; Internet: erf@igc.apc.org
==========
The Back issues and Index
are available
here.
The official RACHEL archive is here.
It’s updated constantly.
To subscribe, send E-mail to rachel-
weekly-
request@world.std.com

with the single word SUBSCRIBE in the message. It’s free.
===Previous Issue==========================================Next Issue===

WHAT WE MUST DO–PART 15: CROOKS LOSE
CONTRACT TO HAUL WASTE FOR CITY OF CHICAGO.

The nation’s largest waste hauler, Waste Management, Inc. (WMI),
has lost its contract to collect trash for the City of Chicago
because a local ordinance prohibits that city from doing business
with companies whose officials have been convicted of bribery or
bid rigging. Executives of a subsidiary of WMI, Ohio Waste
Systems, pleaded guilty to bid rigging in federal court in Toledo
and were convicted in late 1987; as a result, the City of Chicago
notified WMI in early 1989 that Chicago’s trash contracts would
be given to other firms for three years. At the end of the three
years, WMI can try to regain Chicago’s trash hauling business
again. The Chicago ordinance does not affect contracts that WMI
has with private companies, only those with the city.

State legislatures have even more power than local governments to
pass this kind of law. In Florida, the 1988 legislature
considered a bill that would have prevented a company from
winning state, county or municipal contracts with public agencies
if company officials were convicted of, or pleaded “no contest”
to, crimes such as bid rigging, bribery, fraud, price fixing, or
racketeering. (Pleading no contest, or nolo contendere, is a way
of saying to the judge, “I am not admitting guilt, but I am not
going to fight the charges against me.”) The Florida bill died in
committee; it was modeled on a similar law that Florida has on
its books already, preventing state or local contracts with road
builders convicted of crimes.

Ralph Nader has long urged Congress to pass a federal law
changing the way all corporations gain a license to do business
in America. Although many people don’t know it, doing business is
not a right, it is a privilege. Today, corporations gain the
privilege of doing business by becoming “chartered” in one of the
50 states. Once chartered, a company can do business in all other
states as well.

In principal, a company that breaks the law could lose its
charter and be driven out of business entirely. Unfortunately,
states almost never revoke a corporate charter because states
compete with each other to gain corporate charters. Why?
Corporations pay taxes to the state that charters them. The
states compete with each other to gain the most corporate
charters, and thus the most tax. For this reason, states
typically take a “hands off” approach to corporate control. (The
state with the least controls and the lowest taxes tends to get
the most corporations seeking a charter–which is why the large
majority of Americans firms are chartered in Delaware today.)

Ralph Nader favors FEDERAL chartering of corporations. Under such
a plan, there would be only one place to get a corporate
charter–from Uncle Sam–and if corporations didn’t play by the
rules, they could lose the privilege of doing business in
America. Congress has never been very enthusiastic about the
Nader plan.

But even without state or federal action, grass roots citizens
can pass local laws preventing crooks from getting lucrative
local contracts. Losing a contract hurts Waste Management–or any
other large firm–far beyond the dollar loss. It damages their
credibility, and reduces their momentum. Such laws are an easy
way for us to curb the excesses of our adversaries.
–Peter Montague, Ph.D.

Descriptor terms: wmi; waste management, inc.; il; chicago; bid
rigging; bribery; fraud; price fixing; nader; federal chartering
of corporations; corporate charters;

Next Issue