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8/6/08 Chevron lobbies Bush before Obama makes them pay $16 billion

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  • 8/6/08 Chevron lobbies Bush before Obama makes them pay $16 billion

    NEWSWEEK
    Chevron Lobbyists Fight Ecuador Toxic-Dumping Case

    A $16 Billion Problem

    Chevron hires lobbyists to squeeze Ecuador in toxic-dumping case. What an Obama win could mean.

    Few legal battles have been more exotic than the lawsuit tried over the past five years in a steamy jungle courtroom in Ecuador's Amazon rain forest. Brought by a group of U.S. trial lawyers on behalf of thousands of indigenous Indian peasants, the suit accuses Chevron of responsibility for the dumping (allegedly conducted by Texaco, which Chevron bought in 2001) of billions of gallons of toxic oil wastes into the region's rivers and streams. Activists describe the disaster as an Amazon Chernobyl. The plaintiffs—some suffering from cancer and physical deformities—have showed up in court in native garb, with painted faces and half naked. Chevron vigorously contests the charges and has denounced the entire proceeding as a "shakedown."

    But this spring, events for Chevron took an ominous turn when a court-appointed expert recommended Chevron be required to pay between $8 billion and $16 billion to clean up the rain forest. Although it was not the final verdict, the figures sent shock waves through Chevron's corporate boardroom in San Ramon, Calif., and forced the company for the first time to disclose the issue to its shareholders. It has also now spawned an unusually high-powered battle in Washington between an army of Chevron lobbyists and a group of savvy plaintiff lawyers, one of whom has tapped a potent old schoolmate—Barack Obama.

    Chevron is pushing the Bush administration to take the extraordinary step of yanking special trade preferences for Ecuador if the country's leftist government doesn't quash the case. A spokesman for U.S. Trade Representative Susan Schwab confirmed that her office is considering the request. Attorney Steven Donziger, who is coordinating the D.C. opposition to Chevron, says the firm is "trying to get the country to cry uncle." He adds: "It's the crudest form of power politics."

    Chevron's powerhouse team includes former Senate majority leader Trent Lott, former Democratic senator John Breaux and Wayne Berman, a top fund-raiser for John McCain—all with access to Washington's top decision makers. (A senior Chevron exec has met with Deputy Secretary of State John Negroponte on the matter.) Chevron argues that it has been victimized by a "corrupt" Ecuadoran court system while the plaintiffs received active support from Ecuador's leftist president, Rafael Correa—an ally of Venezuela's Hugo Chávez. The company says a loss could set a dangerous precedent for other U.S. multinationals. "The ultimate issue here is Ecuador has mistreated a U.S. company," said one Chevron lobbyist who asked not to be identified talking about the firm's arguments to U.S. officials. "We can't let little countries screw around with big companies like this—companies that have made big investments around the world."

    But Chevron's foes are not without their own resources. Just recently, Donziger and other trial lawyers in the case retained their own high-profile D.C. superlobbyist, Ben Barnes, a major Democratic fund-raiser. And they have tapped a capital connection that may pay off even more. Roughly two years ago, when Donziger first got wind that Chevron might take its case to Washington, he went to see Obama. The two were basketball buddies at Harvard Law School. In several meetings in Obama's office, Donziger showed his old friend graphic photos of toxic oil pits and runoffs. He also argued strongly that Chevron was trying to subvert the "rule of law" by doing an end run on an Ecuadoran legal case. Obama was "offended by that," said Donziger. Obama vetted the issue with Vermont Sen. Patrick Leahy (who has long worked on Latin American human-rights issues), and in February 2006 the two wrote a letter to the then U.S. Trade Representative Rob Portman urging the administration to permit the Ecuadoran peasants to have "their day in court."

    The Obama letter, written before the senator had even announced his run for president, is now the wild card in the Ecuador-Chevron dispute. Donziger said he has had no further discussions with Obama on the issue (although he has co-hosted a New York fund-raiser and, together with his wife, raised between $40,000 and $50,000 for Obama's campaign). An Obama spokesman last week said the senator "stands by his position" that the case is a "matter for the Ecuadoran judicial system." So now the prospect of an Obama presidency has given additional urgency to Chevron's plea for help in Washington. Waiting until next year could leave the oil giant at the mercy of a judge in the Amazon jungle.

    With Stephan Küffner in Quito

    WWW.LIFEAFTERTHEOILCRASH.NET

    WWW.LIFEAFTERTHEOILCRASH.NET WWW.LIFEAFTERTHEOILCRASH.NET

  • #2
    DEMOCRACY NOW (Transcript)
    Chevron Lobbies White House to Pressure Ecuador to Stop $12 Billion Amazon Pollution Lawsuit

    WATCH

    Chevron is being accused of promoting geopolitical blackmail in its efforts to stave off a lawsuit accusing it of contaminating the Ecuadorian rain forest. Nearly 30,000 Amazon residents are seeking $12 billion from Chevron for dumping billions of gallons of toxic oil waste. According to Newsweek, the oil giant is urging the Bush administration to yank special trade preferences for Ecuador if the country’s government doesn’t force the Amazon residents to drop the case. If the White House agrees, it would be the second major lobbying victory for Chevron in just a matter of weeks. Last month, the Senate dropped an effort to penalize Chevron for maintaining extensive ties to the military junta in Burma.

    Michael Isikoff, investigative correspondent for Newsweek. He wrote about Chevron’s lobbying efforts against the Ecuador lawsuit in last week’s issue of Newsweek. The article is called “A Sixteen Billion Dollar Problem.”

    Atossa Soltani, Executive Director of Amazon Watch.

    Marco Simons, Legal Director of Earth Rights International.

    AMY GOODMAN: We turn now to Chevron, the oil giant based in California that’s being accused of promoting geopolitical blackmail in its effort to stave off a lawsuit accusing it of contaminating the Ecuadorian Amazon rain forest. Nearly 30,000 Amazon residents are seeking $12 billion from Chevron for dumping billions of gallons of toxic oil waste. Activists have described the disaster as an Amazon Chernobyl.

    Earlier this year, a court-appointed expert recommended Chevron be required to pay up to $16 billion to clean up the rain forest. Now, Newsweek magazine has revealed new details of how Chevron is lobbying the Bush administration to pressure Ecuador. Chevron is urging the Bush administration to yank special trade preferences for Ecuador if the country’s government doesn’t force the Amazon residents to drop the case.

    Chevron’s lobbying team includes former Senate Majority Leader Trent Lott, former Democratic Senator John Breaux, and Wayne Berman, a top fundraiser for John McCain. The Ecuadorian government has staunchly backed the case. In an interview for Democracy Now! earlier this year, Ecuadorian President Rafael Correa told journalist Greg Palast “Ecuador is no longer for sale.”

    PRESIDENT RAFAEL CORREA: Well, with these lawsuits, well, they don’t go to interrupt the oil production in the third world. They go to push these big international companies in order to be a lot more careful when they want to extract our oil, because they did and they do in the third world things that they don’t do in the first world. So it’s a double standard.

    Ecuador is no longer on sale, you know? Now, Ecuador has a sovereign and nationalist government. That is the huge different—difference, sorry.

    AMY GOODMAN: That’s the Ecuadorian President Rafael Correa.

    The Bush administration has confirmed it’s considering Chevron’s request to pressure Ecuador to drop the case. If the White House agrees, it would be the second major lobbying victory for Chevron in just a matter of weeks. Last month, the Senate dropped an effort to penalize Chevron for maintaining extensive ties with the military junta in Burma. The Senate approved new trade sanctions against Burma but excluded a provision that would have eliminated a large Chevron tax break. Burmese activists had supported the provision to pressure Chevron to end its ties with the junta. The measure had been named after the late Tom Lantos, a Burma advocate and the only US lawmaker to have survived the Nazi Holocaust.

    Well, to talk about these developments, I’m joined by three guests. I’m going to start with Michael Isikoff , investigative reporter with Newsweek magazine, who broke the story on Chevron’s recent lobbying of the Bush administration to pressure Ecuador.

    Welcome to Democracy Now! Michael, can you lay out what exactly is happening around this lawsuit against Chevron?

    MICHAEL ISIKOFF: Well, as you pointed out, Amy, there was the finding by the court-appointed expert a few months ago, which held that Chevron could be liable for up to $16 billion in this lawsuit. And at that point, Chevron stepped up its lobbying campaign in Washington, essentially, to take the case—get the case out of Ecuador and make its pitch in Washington. The specific proposal that it has publicly filed with the US Trade Commission is that Ecuador be denied benefits under the Andean trade preference program, which expires at the end of the year, unless it take action to essentially squash the legal case.

    It has hired a formidable lobbying team, as we reported—John Breaux, Trent Lott, Wayne Berman and a host of others—who have been pressing the case, both within the Bush administration and in the White House and Special Trade office, the State Department—a Chevron executive recently met with Deputy Secretary of State John Negroponte on this—and in Congress.

    Now, I should point out that the plaintiffs’ lawyers here and Ecuador do have a potential key ally. This first came up a couple of years ago, the idea that Chevron might go to Washington. The chief plaintiffs’ lawyer, Steve Donziger, did go to an old Harvard Law School friend of his, the junior senator from Illinois, Barack Obama, laid out what Chevron was trying to do, and Barack Obama, together with Patrick Leahy, did write a letter to then-US trade rep Rob Portman, urging him not to take any action that would take this away from the Ecuadorian court system. So Obama is on record as being against what Chevron wants to do, and Obama’s office reaffirmed his stand on that as recently as two weeks ago, when I wrote the story.

    AMY GOODMAN: You wrote that after Donziger took this story to Barack Obama, the junior senator from Illinois. Obama consulted with the senior senator from Vermont, Patrick Leahy.

    MICHAEL ISIKOFF: Correct. Leahy has a long history of working on Latin American human rights issues. He’s on the—one of the subcommittees that deals with that. And so, Obama, after hearing Steve Donziger lay out the case of what Chevron was trying to do, his office then consulted with Leahy’s office, and they agreed to write this letter that was sent, actually, in 2006 on this. But it pretty much staked out Obama’s position on where he is on this. So that has given, as I reported, you know, some special urgency to Chevron’s lobbying campaign. I mean, I think they want this action taken against Ecuador this year, some fearing, perhaps rightly, that the prospect of an Obama presidency, they’ll get a much less favorable hearing in Washington than they might get now in the Bush administration.

    AMY GOODMAN: I want to talk about the effect of Chevron, before Chevron—it’s ChevronTexaco now, it was Texaco—in the Amazon and wanted to bring into the discussion Atossa Soltani, who is executive director of Amazon Watch, a group that’s worked closely with the Amazon residents suing Chevron.

    Welcome to Democracy Now! I wanted to ask you about just the origins of this suit and what the Amazon residents, these tens of thousands of residents, are claiming.

    ATOSSA SOLTANI: Well, this suit was initially brought by Texaco in 1993, but—by residents of the Amazon disaster in 1993. The court case was initially filed in New York courts. And after ten years of Chevron arguing and presenting motion after motion asking that the court case be moved to Ecuador, the case was finally sent to Ecuador in 2002.

    And so, this case has to do with the fact that for—from 1964 until 1990, Texaco operated in an area of the Amazon Basin that was the size of Rhode Island, and they dug over 900 open waste oil pits, drilled over 350 wells, and dumped over 18 billion gallons of toxic waste into the rivers and streams of this area that was formerly a pristine rain forest. Now, this is a practice that was in breach of industry standards and even illegal here in the United States at the time.

    So, in breach of their own, you know, industry standards, Chevron—back then, Texaco—made a decision to save what would amount to $1 to $3 a barrel by not installing a reinjection system that would have prevented all this pollution. They also did not line the pits, so that every time—you know, so that the oil waste and the drilling muds and all of that seeped into the groundwater and contaminated the rivers and streams upon which the local people depend on. I mean, there is no plumbing in this part of the world. People live off the rivers and streams. They fish and bathe and use water from the surface—from sources in the rivers.

    And so, in this case, you have a situation where 30,000 people are poisoning themselves on a daily basis living in this area. So you have high rates of cancer, birth defects. The court-appointed expert, actually, in his reports attributed 428 deaths to the Texaco disaster, and that’s just, we think, you know, totally underestimating the real number, because most of the people in this area don’t have access to medical facilities or never get tested and pretty much find out too late that they’re dying.

    So this is a serious case. Texaco, now Chevron, argued for ten years that this case should be sent in Ecuador, and now that their own samples and the court case is going poorly for them, they’re now saying that the case—the trial is not fair.

    WWW.LIFEAFTERTHEOILCRASH.NET

    WWW.LIFEAFTERTHEOILCRASH.NET WWW.LIFEAFTERTHEOILCRASH.NET

    Comment


    • #3
      continued...

      AMY GOODMAN: And the role of Ecuador in supporting this lawsuit of the tens of thousands of Amazonian residents, what power does it have in this lawsuit, Atossa?

      ATOSSA SOLTANI: This—I didn’t hear your question. Can you please repeat?

      AMY GOODMAN: The power that the Ecuadorian government has in this lawsuit?

      ATOSSA SOLTANI: Well, first of all, for—again, for over the last five years, Chevron has tried with previous administrations to do everything it can in its power to get the Ecuadorian government to dismiss this case—the Ecuadorian court systems to dismiss this case without luck. Now, this is—you know, what this case has the power to do is really—Chevron, for the first time, is standing trial in an area where it operated without—you know, up to now [with] impunity. It is now being asked to stand trial and face justice. And we have to let the judicial process have its course. You know, this is Chevron’s attempt to interfere with the due process of law, a pillar of democracy. So the fact that, you know, Texaco argued this case deserves to be heard in Ecuador, that Ecuador was a fair and transparent court system, and then had to go and basically present itself in the jurisdiction of the Ecuadorian courts, is where it is now, and now, you know, the US court did say that that was the condition upon sending the case to Ecuador, that basically Chevron would submit itself to the jurisdiction of Ecuadorian courts. Now that things are going badly for Chevron, I think it’s now trying to squash this case.

      And, you know, it’s outrageous that, in the Isikoff article, Chevron’s spokesperson was quoted as saying, “We can’t let little countries screw around with big companies like this.” I think this is ultimately what this is about: Chevron is used to bullying its way and, you know, playing power politics. And this is not working out for them in Ecuador.

      For the rest of the world, what this case means, I think this is really a signal to the oil industry that the days of operating in areas [with] impunity are over and that, really, there is a way for communities in the developing world to bring corporations to justice.

      AMY GOODMAN: If Chevron were to get what it wants, Michael Isikoff, an ending to the special trade preferences for Ecuador, what would that mean for this South American country?

      MICHAEL ISIKOFF: Well, it would have a devastating impact on large segments of the Ecuadorian economy that depend on exports to the United States—broccoli, flowers. There are a number of economic sectors that are heavily dependent on these Andean trade preferences, which have been, you know, part of the law for the last several years. So, the Ecuadorian ambassador to the United States told me this would have an enormous disruption on his country’s economy. Ecuador is a relatively impoverished country to begin with, so to lose something like these trade benefits would be—you know, would have a real impact.

      AMY GOODMAN: So this is a race to the finish here, Chevron pushing very hard in Washington, when you have the prospect of an Obama presidency.

      MICHAEL ISIKOFF: Right. I should also point out that the Andean trade preferences law expires at the end of the year anyway, so it does need a renewal. I think what the Chevron people want is an amendment attached to the trade benefits bill this year, which they can get in Congress, if the Bush administration does not act, that would have the effect of doing what they want, that would either remove Ecuador or require Ecuador to be removed if it doesn’t take the sort of action on the legal case that Chevron is seeking.

      AMY GOODMAN: Well, Michael Isikoff, I want to thank you for being with us from the streets of Washington, D.C. I want to thank Atossa Soltani for joining us in Los Angeles.

      And I want to turn now to the second part of Chevron’s case. It is a story I mentioned in the lede about last month’s decision, the Senate dropping an effort to penalize Chevron for maintaining extensive ties to the military junta in Burma, the Senate approving new trade sanctions against Burma but excluding a provision that would have eliminated a large Chevron tax break. Burmese activists have supported the provision to pressure Chevron to end its ties to the junta. The measure had been named after the late Tom Lantos, the California congressman who was a Burma advocate, survived the Holocaust, the only member of the Congress to have survived the Holocaust.

      We’re joined now by Marco Simons, legal director of Earth Rights International. The significance of this defeat for pro-democracy activists in Burma and the major role that the California Senator Dianne Feinstein played in the defeat?

      MARCO SIMONS: Well, it’s hard to say exactly what role Senator Feinstein played, although we do know that she has been close to Chevron in the past. But I don’t want to overstate the importance of this provision in the context of the overall Burma sanctions measure, and I don’t want to overstate Chevron’s power on Capitol Hill.

      ATOSSA SOLTANI: It’s really low.

      MARCO SIMONS: Sorry, can you hear me now?

      AMY GOODMAN: We hear you just fine.

      MARCO SIMONS: OK. I don’t want to overstate Chevron’s power on Capitol Hill, because, frankly, this provision was a fairly minor provision in the overall context of the sanctions. This provision would have targeted about $30 million in tax write-offs that Chevron gets to avoid double taxation between the Burmese military junta and the US government. But the much bigger picture of Chevron’s project in Burma, which is a massive natural gas project, is that this project provides about a billion dollars annually in hard currency to the Burmese junta, which is a massive proportion of that regime’s income. So, in the grand scheme of things, this is a relatively small part of the sanctions. And what may be much more significant to the regime itself is not Chevron’s tax preferences, but financial sanctions that may—that are part of this bill that may help to cut off the flow of cash to the regime.

      If this provision had really been targeting something that would have gone directly to the junta’s bottom line, that would have really effected the cash flowing into the regime, I don’t know that Chevron would have had the power to stop it, because in recent years, while Chevron certainly does have power on Capitol Hill, they have not actually had the power to get Congress, for example, to dismiss other human rights lawsuits against Chevron. Chevron lobbied very forcefully to cause amendments to the Alien Tort Statute, a human rights law under which Chevron is being sued for human rights abuses in Nigeria, for example, and that lobbying effort failed. And they failed to get the US State Department to intervene in the case, to say that this case would interfere with foreign policy with Nigeria. So—

      AMY GOODMAN: People may be surprised to know that Chevron is the only US multinational corporation, oil company, grandfathered in, that is allowed to operate in Burma right now. Can you explain that and how significant Chevron’s support for the Yadana pipeline is for the Burmese regime’s continuation?

      MARCO SIMONS: Sure. The Yadana pipeline itself is immensely important for the Burmese regime. It probably provides somewhere between 20 and 40 percent of the hard currency income to the regime, which is vital for it to purchase arms and other materiel that it needs to get on international markets. And the Yadana pipeline came online about ten years ago, and before that point, the regime was facing a tremendous shortage of hard currency, was almost in a financial meltdown, and then, suddenly, hundreds of millions of dollars annually, up to a billion dollars now, were injected into the regime’s coffers, and it’s been keeping it afloat for the last ten years.

      Chevron’s participation in that is somewhat less significant, because the project goes on with or without Chevron. So, regardless of whether Chevron stays in or pulls out, this billion dollars annually is still flowing to the military regime. That money doesn’t come from Chevron. The money comes from Thailand, because Thailand is buying the gas. So, until you stop Thailand from paying for the gas, or until you cause banks to stop processing those payments, the money is still going to be flowing to the regime’s coffers. Chevron’s participation is offensive, in that it’s definitely profiting off of human rights abuses against the Burmese people, but whether Chevron stays or goes doesn’t necessarily make a huge difference to the junta itself.

      AMY GOODMAN: Well, I’ll leave it there. Marco Simons, thanks so much for being with us, legal director of Earth Rights International, speaking to us from Washington, D.C.

      WWW.LIFEAFTERTHEOILCRASH.NET

      WWW.LIFEAFTERTHEOILCRASH.NET WWW.LIFEAFTERTHEOILCRASH.NET

      Comment


      • #4
        toooo much to read.. someone sum it up in 3 sentences or less?
        Originally posted by Tanner
        at least youre not hungover and have to sneak out a fat 30 yr old white bitch who you were banging in your parents house last night.

        Comment


        • #5
          Originally posted by shindoa` View Post
          toooo much to read.. someone sum it up in 3 sentences or less?

          Chevron had massive oil spills in Ecuador
          Ecuador is now suing them for $16 billion
          Chevron is lobbying the Bush administration hard to cut trading ties with Ecuador to force them to drop the suit, and they want Bush to respond this year
          Obama has been on record for years supporting Ecuador's right to bring Chevron in their court system

          WWW.LIFEAFTERTHEOILCRASH.NET

          WWW.LIFEAFTERTHEOILCRASH.NET WWW.LIFEAFTERTHEOILCRASH.NET

          Comment


          • #6
            Yeah I can't wait until these fuckers burn in hell.
            change must come from within

            Comment


            • #7
              Originally posted by NyTe^CRaWLeR View Post
              Chevron had massive oil spills in Ecuador
              Ecuador is now suing them for $16 billion
              Chevron is lobbying the Bush administration hard to cut trading ties with Ecuador to force them to drop the suit, and they want Bush to respond this year
              Obama has been on record for years supporting Ecuador's right to bring Chevron in their court system
              ahh much better thank you.

              Comment

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