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WHAT WE THINK
Congress lets the corporate criminals off the hook
A sham crackdown

August 2, 2002 | Page 3

GIVE CROOKED CEOs a slap on the wrist one day--and then stick it to workers the next. That was Washington's real response to the outrage over corporate crime.

After passing toothless legislation on corporate accountability, members of Congress who had opposed the very same bill a week earlier lined up to congratulate themselves in front of television cameras.

Meanwhile, George W. Bush echoed his "dead or alive" speech about Osama bin Laden in a July 29 address in South Carolina. "We expect you [CEOs] to be responsible for the shareholders and your employees," Bush said. "And if you're not, we're going to investigate you, arrest you and prosecute you if you don't uphold your responsibilities."

But back in Washington, lawmakers had already appeased their corporate masters. Less than a day after passing corporate "reform," the House approved a vicious new bankruptcy law.

Bankruptcy was designed to give people drowning in debt a fresh start by removing pressure from creditors. But this new bill, which is expected to go to the Senate in September, was written by banks and credit card companies.

If passed, it will make it extremely difficult for even heavily indebted people to file for bankruptcy--and if they succeed, they will have to keep paying off their bills under court supervision for years to come. "The latest push to overhaul the U.S. bankruptcy code could ease some of the pain in Congress' rush to discipline Corporate America," cheered the Wall Street Journal.

Is anyone surprised that credit-card issuers have given the politicians of both parties $700 million in campaign contributions since 1996?

But that wasn't Congress' only service to big business last week. The House passed "fast-track" legislation that would allow the White House to negotiate new trade agreements and bar Congress from making revisions.

That would give Bush a free hand to negotiate the Free Trade Area of the Americas, an effort to expand NAFTA to include virtually all of Latin America and the Caribbean, for the benefit of U.S. transnational corporations.

What's more, Bush told Congress that he wouldn't accept legislation creating the new Department of Homeland Security unless it ended union protections and civil service rules for workers.

By contrast, CEOs--criminal and otherwise--have little to worry about under the "corporate accountability" law that Bush is preparing to sign. Though Congress was finally forced to respond to the anger about corporate crime, lawmakers made sure to leave out a provision that would have required companies to list stock options as an expense on their balance sheets. That's the accounting gimmick that allows business to inflate reported profits--and deduct options for tax purposes when they're cashed in by executives later on.

But thanks to the work of Al Gore's former running mate, Sen. Joe Lieberman (D-Conn.), stock options are still a profitable way of lining the pockets of already wealthy executives--who can then show their gratitude with big campaign contributions.

Lieberman even used his July 29 appearance at the pro-business Democratic Leadership Council meeting in New York City to say that he and Gore went too far to the left in their election campaign--and that Democrats shouldn't turn the corporate scandals into "an economic class conflict."

And for all the hot air about "corporate responsibility," no one in Congress is lifting a finger to reverse deregulation--the policies that allowed Enron to rip off California by manipulating energy prices and let WorldCom, Qwest and others plunge the entire telecommunications system into crisis.

"What deregulation has produced is an economy and culture rooted in conflicts of interest," wrote economist Robert Kuttner. "The [Securities and Exchange Commission] already had the power to police most of these, but Congress directed it not to."

For Bush and the Democrats in Congress, the corporate crime spree is a public relations problem. All they want is some spin control--and maybe one or two new laws to protect the status quo--a political system utterly dominated by business interests at the expense of working people.

Workers' labor was the real source of the enormous wealth created in the 1990s--not slick accountants and Wall Street insiders. The only way that Corporate America will be genuinely held accountable is when workers organize to take back what's rightfully theirs.

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