A Film By Stuart Townsend, 2007

- Jeremy Agar

Made as a feature film, “Battle In Seattle” took some time to make it this way, and when it did, it by-passed the theatres of NZ, going straight into DVD format.This would have been a market decision; distributors assuming it would’t have attracted a big audience.Probably not.These are the times we live in. It doesn’t mean that it’s not a good movie. The battle refers to the demonstrations against the World Trade Organisation’s [WTO] conference in Seattle in 1999. Protest was successful in that the agenda, to tie the world into a neoliberal big business regime, had to be abandoned as demonstrators took to the streets outside.

The film imagines a cast of “free trade” opponents and their efforts to disrupt the conference. Some of the police want to bang heads. The Mayor wants everyone to cool it. The Mayor, the only character with an identifiable historical role, is given a new identity, so he is not presented as the actual Mayor at the time.This Mayor is presented sympathetically. Whether the historic person was comparable doesn’t matter. We’re looking at a story. The demonstrators are sincere, the riot squad are told. They have their reasons and they deserve respect. They aren’t anarchists. This observation could have foreshadowed the authorities’ well-meaning misunderstanding of what they were up against - an informal coalition which included a lot of anarchists. But then a main character makes the same mistake. So the confusion is that of the film’s producers, for whom “anarchism” is identified with those inevitable vandals who turn up, like looters after an earthquake, when there’s a sniff of action. Sometimes these types are sincere. More often - especially when the mayhem is of a kind that’s certain to alienate, as is revealed here - they’re police provocateurs. A rule of thumb could be: If people turn up in masks, throwing rocks through shop windows, they’ve been manipulated by the police. All the protest organisers (who include anarchists, even if they don’t describe themselves as such) know is that they’re bad news. The misunderstanding of anarchism is the one false note in Battle of Seattle.    

Protestors Did The World A Big Favour

By forcing media attention, and by organising a counter agenda, the protestors did the world a big favour. People began to think past State platitudes. Marginalised critics saw that they were not alone. Seattle gave the “free traders” a sufficiently hard time for them to give up on liberal Western venues where opinions can be too easily expressed and communicated to the world. The WTO next tried Doha, in the Persian Gulf. In 2001 the neoliberal agenda would be advanced behind the closed doors of Qatar. The man in charge in 1999 was Mike Moore, who is not to be confused with Michael Moore, the American filmmaker (whose “Capitalism: A Love Story” is reviewed below). Mike, a 1980’s Rogernome, was briefly PM of NZ, and is soon to be the NZ Ambassador to the US, in which role his self-proclaimed top priority is to secure a Free Trade Agreement with the US. Mike, who had a walk-on role as the front man stooge for the big boys, appears twice here as a background item on TV news, gabbling on about how great everything will be. They’re nice vignettes.    

In Qatar too, the WTO found the going hard, this time because of resistance from within the conference. Poorer, developing countries were asking questions and not getting good answers. The consensus that the big players, led by the US, Europe and Japan, were trying to forge, didn’t form. Two years later the neoliberals tried again, at Cancun, in Mexico. Cancun is a beach resort, but this round of talks was not a return to the open society. Meeting behind police barricades, the delegates again failed to nail the contract. Since then the frustrated “free traders” have been nibbling at the edges. NZ of course has been hungry for a deal with the Americans.The assumptions are that the US is the one country that matters, and that if enough governments within the American orbit sign enough agreements with the keener players, then it might not matter if a global consensus doesn’t form.   

Seattle in 1999, the end of the century.That’s a neat framing of the matter. A less honest film might have offered us the thought that the failed conference closed a corrupt epoch. It could have gone all sixties - the new century will be the Age of Aquarius and flower power. Townsend has resisted such glib sentimentality. To comment on a specific and recorded history, especially such a contested and recent history, with a fictional story, is risky. Around the world polarised audiences might have wanted to see a simple morality tale, a modern day western, with the black hats taking on the white hats. Townsend hasn’t obliged. He knows that the often conflicted individuals caught up in historical dramas shouldn’t be confused with the forces that have moulded them.    

(Watchdog has covered WTO and related issues in depth. See, e.g., “WTO ‘New Issues’ = Old MAI”, by Bill Rosenberg, Watchdog 101, December 2002; and “The Doha ‘Anything-But-Development Round’”, Watchdog 110, December 2005, by Jane Kelsey. See also my reviews of “Serving Whose Interests? A Guide To NZ Commitments Under The WTO General Agreement On Trade In Services”, Watchdog 102, May 2003,; and “Free Trade At Any Price? The World Trade Organisation Doha Round”, Watchdog 104, December 2003, by Jane Kelsey).


A Film By Michael Moore, 2009

- Jeremy Agar

Not so long ago in Florida a property company styled itself the Condo Vultures. When the American sub-prime bubble burst, Florida, with thousands of foreclosures, was one of the worst hit areas. Confident that the market would at some point again inflate, Condo Vultures scooped up houses and apartments on the cheap. Knowing that he was an efficient operator, the Chief Executive Officer was happy to cooperate with Michael Moore. “We clean up”, he tells Moore, “we don’t do the killing”. The vulture has a point. His talent was for appreciating the simple dynamics of supply and demand, and the vultures might well have cleaned up. But for all his market savvy, the entrepreneur could have done with a PR man. Families left homeless don’t like being described as corpses whose bones are good for nothing but the fattening of rich men’s bank accounts.

Away from the cameras the language of the predators is more likely to skip rationalisations and reveal outright contempt for working people. Moore looks at the life insurance policies which some of America’s biggest corporations, like Walmart, took out on its employees. The hunch about this supply of people was that the company’s wage slaves would often die prematurely; the demand was profit. Walmart called these death bets their “dead peasants” policies. The corporate vultures gathered over the body of American capitalism know that there’s always a buck to be made. Traditionally, the best profits have been rendered by the poor. The original peasants, when still alive, provided the landowners of the world with centuries of free labour - and still do in some places. That was the feudal labour market. If there were not enough live peasants, live slaves could be imported. That was the early capitalist labour market. Moore is looking at developed capitalism. We’ll have to wait a while before we’ll know if 21 st Century capitalism will come to be called late capitalism. 

It’s over the poor are that the vultures like to hover. That’s because there are more poor people than rich people, because rich people can recruit armies (feudalism) or hire lawyers (capitalism) to defend themselves, and because misfortune is more likely to afflict the poor. Disasters provide extended and often monopolistic market opportunities. This is why Hurricane Katrina is a potent emblem of the Bush “predator state” (see my reviews of “The Predator State” by James Galbraith in Watchdog 122, December 2009, and Naomi Klein’s “The Shock Doctrine”, in Watchdog 117, April 2008, 

One market excess that Moore exposes is of topical interest in NZ where, in February 2010, John Key announced that two prisons will be privately run. In the US, a judge sentenced hundreds of kids to jail for trivial offences so that he could claim millions in kickbacks from the local jail entrepreneurs, to whose sales volumes he was a dominant contributor. In this version of vulture capitalism, in which the demand by profit is for naive young lives, the State was a direct and reliable supplier. “Capitalism” could be Michael Moore’s best film yet. In the past he’s found it hard to resist the odd cheap shot and he didn’t mind if a good gag got in the way of his narrative. This time there’s a new maturity and seriousness in play. There’s no lack of his trademark humour, but it’s not allowed to divert from his theme. “Capitalism” screens as a summary and culmination of his previous films.


“There’s no in-between no more”, laments a laid off worker, referring to the increased inequality that has been the necessary, and intended, result of US economic policy. The shredding of middle class security (which James Galbraith sees as both a main purpose of the neoliberal reforms and the measure of US decline) has been accompanied by an assault on democracy. Democracy is a core value in the US, so the vultures don’t usually squawk their contempt for it.  Moore reminds us that in 2005 a Citigroup memo was leaked. In it executives were warned of the dangers to profits that would ensue from notions like an “equitable share” and “one person, one vote”.  

This memo, along with a successor, is available on the Internet. In these the bank welcomes the trend to extreme and increasing “income and wealth inequality”, which it calls “plutonomy”. The plutonomists, we read, freakishly rich, are the bank’s preferred clients. They include celebrity chefs, lawyers, bankers, golfers and designers. Plutonomy has been brought about by “converting globalisation and technology to increase the profit share of the economy at the expense of labour”. Plutonomy, Citigroup acknowledges, means current account deficits and low savings rates, but the uber-rich don’t need to worry about these things. Citigroup tells us that, for the plutonomic economy, they’ve tired of the cost of living index, the CPI. Their analysts prefer the CLEWI. That’s the Cost Of Living Extremely Well Index, which has (had?) detected inflation. For instance, in 2006 the price of a kilo of beluga caviar had gone up 40% - to $US6, 840 a kilo. 

Plutocrats being immune from economic shocks (yeah, right, like celebrity golfers?), “as a result, principally, of globalisation”, the good times were expected to just keep on rolling. “We expect the global pool of labour in developing economies to keep wage inflation in check and profit margins rising - good for the wealth of capitalists, relatively bad for the developed market unskilled/resource-able labour”. What might threaten the beluga caviar munchers? “At some point it is likely that labour will fight back”.

Christianity, in whose name the vultures notoriously fly, is another core US value. But when Moore returns to his hometown, Catholic priests suggest that their faith demands that they protect their flock from the vultures. Flint, Michigan, where Moore began his film career with “Roger And Me”, an investigation of General Motors, is a sadly apposite venue. GM, whose famously inappropriate boast was that “what’s good for GM is good for America”, went bust, but that hasn’t been good for Americans. Not that GM was all bad. Thanks to a strong autoworkers union, in the average Flint household one income was enough to ensure a family’s good health coverage, university entrance for the children, a pension and holidays.

Capitalism Must Be Replaced By Democracy

Moore presents statistics of latter-day capitalism. As Citigroup gleefully confirm, the top 1% of households now control more wealth than do the bottom 95%. Productivity is up 46%, while wages are up 1%. So Moore’s sub-title is not sarcastic. The love story is genuine: it’s the memory of a childhood, of a still sustainable Flint. Moore is a conservative. He’s taking back from the vultures the core American values of capitalism, democracy and Christianity. Like most observers, Moore dates the change in mood to the 1980-88 Reagan presidency. The Gipper profited from a preachy Jimmy Carter sermon on the dangers of consumerism. Republicans stitched this into an accusation that Carter was un-American (Jimmy Carter was the Democrat President from 1976-80. Ed.). They twisted the facts to complain that he had been talking of a “malaise” (it’s not unlike the transition from Head Girl Helen Clark to Sunny John Key).

The golden weather in Flint followed a 1936 strike which secured concessions from GM. Moore discusses President Franklin Delano Roosevelt’s “second” Bill of Rights. In 1944 FDR declared that Americans deserved a useful and remunerative job, freedom from monopolies, a decent home, medical care, security and education. Predator capitalism - parasitic capitalism - is resolved to destroy these. Moore has been adroit in his selection of evidence. The potential material is vast, but what we’re shown is an effective use of telling incident and revealing language which entertains as it instructs. Moore here is focussed, and his point is clear. Vultures are simple creatures. They want profits. The one obvious way to make sure there are plenty of corpses lying around is to isolate the bodies by breaking the power of trade unions.

Capitalism, he concludes, is evil, and it can’t be regulated. It needs to be replaced with democracy, which Moore, like Galbraith, discerns in Rooseveltian America - what’s often called social democracy.

Ever cheery, Moore is optimistic that the bubble that burst is scaring the birds of prey. There are no more corporate references to dead peasants, the condo vultures have flown away, and the Pennsylvanian jailing judge has been tipped off his bench. Most promising of all, activists have occupied factories in a successful attempt to secure redundancy pay. The fightback has begun. 


A Film By Robert Connolly

- Jeremy Agar

On Mount Victoria, in the heart of Wellington, a native tree will be planted and a park bench will soon be in place. A plaque will indicate that the simple memorial honours the memory of Gary Cunningham, a TV journalist working for an Australian network in East Timor who was murdered by Indonesian soldiers in 1975. The planned memorial was organised by the Indonesia Human Rights Committee with support from the Media Freedom Committee and Wellington City Council. It’s a suitable site. Cunningham once lived nearby and he won an award for his coverage of the 1968 Wahine disaster when the inter-island ferry sank in the harbour below. There’s another link. The view from Mount Victoria has something in common with the view from Balibo, the place Cunningham died.

Balibo is high on a hill in East Timor, near the border with Indonesian West Timor. The Balibo Five, as they’ve come to be called, were journalists covering an anticipated invasion from Indonesia. As we see in the film, the five had stationed themselves in an old Portuguese fort overlooking the sea, where Indonesian warships were arrayed. Armed men in civilian clothes emerge from the bush, photographed by the Australian team. The crew sense they’re in danger and flee. Hiding in the fort, they’re shot in cold blood. These scenes are chillingly effective.

They’re also historically accurate, as was established by a sixth journo. Connolly tells the story via Roger East’s search for the missing quintet some days after they had failed to return from their Balibo assignment. The film opens with East in Darwin. He’s a frizzled, cynical veteran at first unmoved by the plea from an East Timorese democrat (the young Jose Ramos Horta, now his country’s President) to pay attention to the imminent plight of his homeland. It’s a movie cliche perhaps, but in this instance the cliche happened. East thrashes through the jungle, finds evidence of the butchery, and reports back. East stayed on in Dili, determined to honour his colleagues by reporting on the invasion, so he, too, was murdered by the Indonesian military. Roger East, subtly played by Anthony LaPaglia, is the centre of the story.   

Indonesia didn’t want the world to know that it was crossing an international border with no provocation except that the East Timorese wanted an independent country in the same way that a generation earlier Indonesia had successfully fought for its own independence from the Dutch. If you look at a map, which depicts East Timor as part of an Indonesian island within an Indonesian archipelago, it might seem that Jakarta at least had a case for wanting East Timor to become part of the country. But the map is misleading. We have to look at history. Indonesians followed the normal logic of post-colonial nationalists by fighting for a country that would take over the areas that had been Dutch possessions. That’s why New Guinea has a line running down the middle, separating Papua (formerly Dutch and now Indonesian) from Papua New Guinea (formerly Australian). So, by its own rules, independent Indonesia should not have expected to annex East Timor, a former Portuguese colony.  

In the context of unprovoked brutality this background might seem academic, but it could be part of the reason for Indonesia’s behaviour. Under international law it knew it couldn’t justify its claim for East Timor. So did all the governments that connived at the aggression. This is the significance of Balibo. It’s why Gary Cunningham’s name is largely unknown in Wellington and New Zealand. The governments of NZ and Australia collaborated with Indonesia in covering up the massacres. They actively went along with the Indonesian lie that the journalists had been caught in crossfire. The version of events that the film depicts, of a sustained and deliberate mass murder of unarmed civilians, is accurate, as even the Indonesian Army now admits.    

It’s not as if the incident can be explained away as the emotions of the moment, like the killing of Japanese prisoners of wars during World War 2 (as happened in both New Zealand and Australia). This happened in 1975, when the most passionate public event in NZ was the replacement of the Rowling Labour government by the Tories led by Muldoon. Neither Indonesia nor East Timor has a history of bad relations with NZ or Australia. We’re not talking Gaza or the Balkans. Yet the events at Balibo were officially being denied for the next generation.  

US, Australia, NZ Accomplices

Why did successive governments of NZ and Australia - along with the UK and US - behave so deplorably? The first pointer is to look towards America. Indonesia would not have been brazen without at least a hint from the US. The Secretary of State, Henry Kissinger, saw the world as a playpen for American adventures. When it came to the “South”, the part of the globe that was neither the North Atlantic Treaty Organisation (NATO) nor the former Warsaw Pact, he was contemptuous. Places like Indonesia and, even more so, tiny East Timor, were pawns in his global game. Immediately before the invasion Kissinger and President Gerald Ford were in Jakarta for talks with Suharto, the Indonesian dictator. As soon as Air Force One left Indonesian air space, the Indonesian military invaded East Timor and started killing people. That’s as close to a smoking gun as it gets (similarly, in 1975, Gough Whitlam, the Labor Prime Minister of Australia, gave Suharto the go ahead. The film shows their meeting in a newspaper used to wrap Roger East’s fish and chips in Darwin. There has always been a bipartisan consensus in Australia that is obsessed with “instability” in their huge Asian neighbour. Ironically, Whitlam gave that go ahead whilst he himself was, fruitlessly, fighting for his political life against being unseated by a bloodless coup waged by the Australian Right and its American backers. After a carefully manufactured political and economic crisis his Government was dismissed by the Governor General and heavily defeated in the ensuing election. Ed.).

Kissinger was obsessed with fighting Communism, and it was announced that the East Timorese freedom fighters (Fretilin) were Communists, an analysis about as useful as saying that they were bogeymen. The complicit governments wanted to keep on side with Indonesia, regionally a big player which could be relied on to be brutal in suppressing freedom. Suharto himself had come to power by killing anywhere from half a million to more than a million opponents, people he called Communists and thus deserving of death (see Peace Researcher 25, March 2002, Special Issue, “Ghosts Of A Genocide: The CIA, Suharto And Terrorist Culture”, by Dennis Small, Ed.). All concerned had been there, done that. It’s possible that by allowing speculation that Balibo followed a US nod and wink, Kissinger and Suharto were signalling to the region that they were in charge and weren’t to be messed with (remember that 1975 marked the humiliating defeat of the US and its puppet governments in the wars in Vietnam, Cambodia and Laos).

US allies, governed by elites who had to put down their own domestic bogeymen, had traditionally taken Commie panic at face value. It was a default setting. But this time, didn’t they take it too far? Measured purely as an act of naked aggression, the invasion could be seen as cruder than other more documented events such as Hitler’s attacks on Czechoslavakia in 1938 and Poland in 1939. The East Timorese were subjected to 24 years of brutal occupation, throughout which our governments continued to deny all. The film is based on Jill Jolliffe’s book “Cover Up”. It tells the story by cutting between the Balibo Five and East’s covering of the same ground. It’s a particularly effective solution to the tricky narrative problem of dealing with interlocking periods. It’s gripping stuff.

183,000 Deaths Before Independence Won

Thanks to the work of groups like the Indonesia Human Rights Committee the events that followed the Balibo massacre became well known and after 183,000 deaths East Timor won independence in 1999 (Jose Ramos Horta, East’s guide, started off as Prime Minister and is now President). Yet the NZ government was still doing all it could to see no evil, speak no evil, and hear no evil. For a detailed account of New Zealand’s shameful quarter of a century of appeasement of Indonesia vis a vis East Timor, see my review of Maire Leadbeater’s book “Negligent Neighbour” in Peace Researcher 34, July 2007, The East Timorese were still to be punished for being a small and unstrategic society, and for having suffered too long under Portuguese military dictatorship (in that, had Portugal been a democracy in 1949, when, after prolonged struggle, Indonesia was let go by the Netherlands, East Timor would have been allowed independence).

Early in their relationship, when a frustrated Horta is imploring East’s support, the young East Timorese accuses the older Australian of being interested only in a few deaths of white people rather than the rape of a culture. Given Horta’s experiences, this is a sentiment that’s easy to identify with, but in the immediacy of common struggle the difference is soon forgotten. Beyond the Balibo Five and Roger East, there’s a third framing of the narrative. The first shots are of a young East Timorese girl who witnesses East’s execution. She reappears as a mature woman at the end, an indication that Connolly sees his story in terms of a human solidarity which transcends race, time and gender. Cultural tension is not his theme. Balibo is an expose of complicit governments and a statement about freedom of the press.     

No representative of the NZ government was present at the Mt Victoria ceremony. The Minister of Foreign Affairs, Murray McCully, said he had raised the matter of war crimes with the Indonesian government on a visit in 2009 but had not sought an apology and an admission. The present Government is not the sort to wear its heart on its sleeve, but apologies are in fashion. Lots of institutions have been saying they’re sorry, with varying degrees of sincerity. The apologists tend to share a confidence that the thing they’re apologising for is buried in the past with no present implications (by contrast, in 2009, the Australian Federal Police, a mere 34 years after the event, launched a war crimes investigation into the murders, following a 2007 coroner’s inquest. This investigation, specifically the suggestion of prosecuting the Indonesian senior officer in charge at the Balibo massacre, who went on to become a politician and minister, has led to diplomatic tensions with Indonesia, which has also banned this film. The inquest also forced into the open evidence that the Australian Defence Signals Directorate, the spy agency equivalent to the NZ Government Communications Security Bureau, had, via its Darwin spybase, been fully aware of the Indonesians’ invasion preparations and of their murder of the Balibo Five. Ed.).


A Film By Steven Soderbergh, 2009

- Jeremy Agar

There’s Big Tobacco, Big Oil, Big Pharma - the corporate villains present themselves as giants of malfeasance. This film might have been about Big Agribusiness. Archer Daniels Midland (ADM) is a huge farming corporation that sprawls over the US Midwest. Two major books chronicled ADM’s story. One of them, “Rats In the Grain: The Dirty Tricks Of Archer Daniels Midland The ‘Supermarket To The World’”, was reviewed by Murray Horton in Watchdog 95, December 2000 (see below). This movie is based on the book by Kurt Eichenwald - it shares its title - where the emphasis is more on the personal stories within the one big story. 

ADM’s conviction for price fixing, which stretched to Asia, remains the biggest such case ever brought. ADM produces corn syrup, a cheap alternative for sugar that is used in a lucrative range of products, and its market power is immense. But the film isn’t really about Big Agribusiness. It’s more interested in another world record that the case involved: Mark Whitacre, a senior executive at ADM, remains the world’s highest ranking whistle blower. He’s an odd person. Whitacre approached the Federal Bureau of Investigation, agreeing to spy for them as he revealed evidence of the company’s criminality. He was wired for two and a half years. As it happened the FBI was already investigating ADM, following an allegation from Whitacre himself that the company was being sabotaged by foreign competitors. This turned out to be an invention of Whitacre’s, whose mental health was shaky. 

Played Strictly For Laughs

An already confusing series of relationships was further muddled by the even more bizarre revelation that Whitacre had been embezzling from ADM. The agents whom he had twice caused to look into the company’s dealings found that he had pocketed $US9.5 million. And after these events, after a prison term, this strange man confided to Soderbergh that he had wanted to finish up as Chairman. Whitacre, played against type by Matt Damon, becomes the film’s sole interest, so that the story about the rats in the grain is not told. “The Informant!” is a character study of Whitacre, but not much else. We scarcely get to see the other suits.    

Soderbergh produced “Erin Brovokovich”, perhaps the most successful of the Hollywood corporate-busting genre. He’s also directed the “Ocean’s 11, 12, and 13” frolic flicks. “The Informant!” plays as though Soderbergh originally couldn’t decide between exposé and caper - and settled for slapstick. That would explain the comic techniques he intersperses and the otherwise curious exclamation mark in his title. The music composer has explained his jaunty soundtrack: ‘I want everyone to think that they’re coming in for a real melodrama.... Once we did that, then the whole film becomes one constant ‘let’s have a good time’”.

Reactions have varied from a “hilarious” and “light hearted fun” critical verdict to audiences walking out. The latter group are probably those who were expecting another Brockovich or an investigation along the lines of “The Insider”, the excellent 1999 movie starring Russell Crowe which took down the tobacco industry. “The Informant!” is at times quite unlike what a reader of “Rats In the Grain” might have expected. For his pains Whitacre got nine years in the slammer. Other suits got only three years, while nothing could be pinned to the Chairman, the friend of Presidents and movie stars, who got off. His story remains to be told. Soderbergh might have good reason to think that this outcome is reason enough for the story to play as farce. 

We don’t make a habit of reprinting stuff from earlier issues of Watchdog. But in this case it is for very valid reasons. In Watchdog 95, December 2000, I reviewed “Rats In The Grain”, a book about exactly the same subject as “The Informant!” (which was adapted from another book on the subject). I am reprinting my ten year old review because the book is far superior to the film, which I saw (and I agree with Jeremy’s review of it). The book is what the film could have, and should have, been like. Ed.


The Dirty Tricks And Trials of Archer Daniels Midland The ‘Supermarket To The World’”.
By James B Lieber. Four Walls Eight Windows, New York, 2000.

- Murray Horton

This is one fascinating book. "Rats In The Grain" is a 400+ page study of the trial of three Archer Daniels Midland (ADM) executives arising from the 1990s’ price fixing scandal that saw the company plead guilty and be fined $US100 million (followed by similar scale fines in Canada and Europe, also for price fixing). The company had secretly met with its Japanese "competitors" and rigged the price of lysine, an animal feed additive. The same happened with citric acid and high fructose corn syrup, but no charges were ever brought in relation to them. Following the settlement of the civil case, three senior executives – Michael Andreas, Terry Wilson and Mark Whitacre – faced criminal charges arising out of the same international price fixing conspiracy.

Andreas was Executive Vice President, son of ADM Chief Executive Officer, Dwayne Andreas, and heir apparent. Terry Wilson was head of the corn processing division; Whitacre was head of the bioproducts division. Whitacre was also a whistleblower and informant for the Federal Bureau of Investigation (FBI). Corporate whistleblowers enjoy quite a good press in the US. When Whitacre offered to be an FBI mole, they approached the job as they would any undercover assignment against an organised crime syndicate – he was fitted out with concealed cameras and tape recorders to secure evidence. Those tapes and photos played a key role in convicting Andreas and Wilson (plus some of the Japanese executives, who got very light sentences in exchange for cooperating with the US government). They comprise the most compelling photos in the book.

But, by the time the criminal trial started, in 1998, Whitacre was already in prison on other criminal matters – he had played a double game with the FBI and had been involved in money laundering and embezzling offences at ADM during the time he had been an informant. For this, he had been sentenced to nine years in prison – he was not present during the price fixing trial (having waived his right to be there), and was singled out by the judge for the toughest sentence, having prison time added to his sentence. It was unprecedented for an informant of this stature to be treated so harshly by the courts (the prosecution hadn’t asked for any extra time). By contrast, Andreas and Wilson only got a couple of years each (increased, on Federal appeal, in September 2000, to between 2 ½ and three years). Whitacre was a far from ideal informant (he attempted suicide, at one point) but his undercover work was the winning of the case. Not that he got much thanks for it. He remains philosophical: "Life in prison has been better than life at ADM". Nicholas Hollis, president of the Agribusiness Council, an industry watchdog, saw Whitacre in a different light: "He’s one of the most productive informants in history and one of the most courageous…This was one of the most important antitrust cases of the century. It certainly was the most important in agriculture".

This company is virtually unknown to New Zealanders, but it is one of the very biggest agribusiness transnationals. Not for nothing does it call itself "The Supermarket To The World". It is a company with enormous clout in the US, and globally. Dwayne Andreas, ADM’s patriarch, had assiduously cultivated both the Democrats and Republicans for decades. He was among the first of the corporate Chief Executive Officers to have 50c either way when it came to political parties (rather like what the beer barons have always done here). He was up to his elbows in the 1970s cesspit that was the Watergate scandal (Republican President Richard Nixon got a very large sum, in cash, for his re-election campaign); he’s been in the thick of the disgraceful business of Big Business buying elections by raining money on candidates. Senior Democrat Party figures were on the ADM board; the law firm that (successfully) represented President Clinton during his impeachment was involved in the trial. Andreas believed in the "key man" school of history. Globally, he cultivated national leaders, to advance the interests of ADM (there’s a photo of him with Mikhail Gorbachev, leader of the former Soviet Union, in the book).

"When It Comes To Agriculture There Is No Such Thing As A Free Market"

That quote from Dwayne Andreas beautifully sums up the philosophy of the Big Business monopolist. ADM had no qualms about price fixing – the FBI investigation recorded the company’s unofficial motto as being: "The competitor is our friend and the customer is our enemy". So, senior management (including Whitacre) went merrily into cooking up deals with Japanese competitors, meeting covertly in hotel rooms around the world. There is an irony in this – ADM initially called in the authorities because the company thought that it was the target of industrial sabotage by rivals. Consistent with its modus operandi, ADM reported this to the Central Intelligence Agency. The CIA, which (theoretically) has no domestic US role, turned it over to the FBI. It was when the FBI was investigating this allegation (unfounded, as it turned out) that Whitacre spoke up about the price fixing and offered to be an undercover informant. The corporate culture at the top was spelled out by Terry Wilson: "The big problem is to remember what lies I’ve told. Always you have to do that. He (Dwayne Andreas) said that you should really write it down". Not that Wilson had any illusions about their prowess as conspirators: "You know, the main thing is if we’re trying to fix prices, we ought to be fired for being so fucking incompetent". The Government and judge disagreed: Wilson and Andreas went to prison.

The book is a fascinating study, one of those courtroom dramas that the Yanks do so well. American capitalism appears quaint viewed from the cowboy frontiers of the New Zealand variety – there’s no possibility of NZ executives going to prison, or even being prosecuted, for anti-trust offences. Price fixing gets a slap on the wrist in the civil courts here. Insider trading has never been prosecuted, and wasn’t even an offence until very recently. But that’s as far as our congratulations to the US system need to go – ADM itself got off scotfree, apart from fines that can be written of as just part of the cost of doing business. Dwayne Andreas, the patriarch, stepped down as CEO earlier than he intended, but nobody else in senior management faced any charges or a short stretch in a country club prison for white collar criminals. It is very much business as usual.

But wait, there’s more. Watchdog 95, December 2000, also included an article by Bill Rosenberg entitled “American Corporate Criminal Comes To NZ: OIC Happy With Its ‘Good Character’”, which is online at It focused on the fact that ADM had been given approval that year by the Overseas Investment Commission (now the Overseas Investment Office) to become the 40% owner of the Canterbury (NZ) Malting Company Ltd (the other 60% was owned by a French transnational). In the following decade, ADM sold out, so the story is now of historical significance only, and I don’t propose to reprint the article here. But CAFCA did make one of our (100% unsuccessful) complaints to the OIC about the persons owning or controlling the International Malting Company Ltd (co-owned by ADM and the French company) not being of good character, as required by the Overseas Investment Act. Surprise, surprise, the OIC saw nothing to be concened about and you can read why in that 2000 article. But the article also added further details to the events covered in “Rats In the Grain” and “The Informant!” and here are some relevant extracts. Ed.

Price Fixing: $US100 Million Fine, Senior Executives Imprisoned

ADM, as well as being one of the largest agribusinesses in the USA (it is that country’s leading corn processor for example), has one of the dirtiest records for price fixing, and a long history of political meddling. So much so that it has the dubious privilege of recently having had a book published about its latest price-fixing scandal: "Rats in the Grain”. In a review of the book, Russell Mokhiber (editor of Corporate Crime Reporter) and Robert Weissman (editor of Multinational Monitor) summarised the events it covers as follows:

"In October 1996, ADM pled guilty to antitrust crimes and was fined $US100 million. Senior vice presidents Michael Andreas, the son of Chairman Dwayne, and Terrence Wilson were convicted of antitrust crimes in 1999 after a trial in federal court in Chicago. They were sentenced to three years in prison each". That’s fairly serious stuff. The crimes involved the two former ADM executives conspiring with four Asian competitors to rig the $US650 million a year market for lysine, a lucrative livestock feed additive made by ADM: without any exaggeration, an international conspiracy of huge proportions. The US action was not the end of the matter. On 7/6/00, the Wall Street Journal ("EU Fines Archer Daniels Midland And Asian Firms for Price Fixing") reported that:

"The European Union on Wednesday fined Archer Daniels Midland Co and four Asian companies a combined €110 million ($US105 million) for their involvement in a price-fixing scheme". ADM was fined the lion’s share, at €47.3 million. ADM has a history of this sort of behaviour, as the report continued: "The investigation found that the five companies fixed lysine prices worldwide, including in the European Union (EU). The investigation also determined that the companies fixed sales quotas for the EU market and exchanged information concerning those quotas from ‘at least’ July 1990 through June 1995.

"The fines stem from a probe that began in 1997 when ADM disclosed the EU was conducting an inquiry into the grain processing giant’s European units and other companies. Wednesday’s announcement is the latest blow to the Decatur, Illinois, agribusiness, which has been found guilty of price fixing in the past. In 1996, the US Justice Department fined ADM $US100 million after the company pleaded guilty to fixing prices for lysine and citric acid. In 1998, ADM also paid a fine of $C16 million ($US10.83 million) for price fixing on the Canadian market"…

Here is how that 1996 US case was described by Janet Reno, US Attorney General: "Archer Daniels Midland has agreed to plead guilty and pay a $US100 million criminal fine, the largest criminal antitrust fine ever, for its role in two international criminal conspiracies to fix the price of lysine, a feed additive used to ensure the proper growth of livestock, and citric acid, a flavour additive and preservative found in soft drinks, processed foods, detergents and other products. Because of these illegal actions, feed companies, poultry and swine producers, and ultimately America’s farmers, paid millions more to buy the lysine additive. Also, manufacturers of soft drinks, processed foods, detergents and other materials, paid millions more to buy the citric acid additive, which ultimately caused consumers to pay more for these products" ("Rats In The Grain", p38)…

Political Meddling: Buying Influence, From Long Ago

The intrigue is lent credibility by ADM’s long history of political connections, particularly through its Chairman, Dwayne Andreas. (Journalist Kurt) Eichenwald describes it (presumably with considerable understatement) like this: "Since the time of Thomas E Dewey – the former New York Governor and Republican Presidential candidate who, when he was a lawyer in private practice, served as an adviser to Dwayne Andreas – Archer Daniels has been a strong political force. With an ease that bred envy among other corporations, the $US9.2 billion food industry giant navigated between the Republicans and Democrats while helping to form this country’s agricultural policies" (New York Times, "Former Archer Daniels Executives Are Found Guilty of Price Fixing", 18/9/98, pA1).

"Forming this country’s agricultural policies" includes an important role in gathering subsidies and in forming the US policies in world trade negotiations. Washington Post reporter, Steven Mufson described the politics in more detail (Washington Post, "Andreas Steps Down; ADM Chief Took Politics to a New Level", 26/1/99) when Dwayne Andreas stepped down as Chairman (but remained on the board) in the wake of the scandal. He began his article, "Dwayne O Andreas, the grain company executive who pioneered the art of political campaign contributions and built one of the country’s biggest food-processing empires, stepped aside yesterday as chairman of Archer Daniels Midland Co.".

He writes: "’It was a wistful day’, said Democratic insider Robert S Strauss, a long time Andreas friend and ADM director, after the company’s board meeting in Bal Harbour, Florida, yesterday. Strauss said Andreas ‘was a player on the global stage before most people could spell ‘global’. "But to his critics, Andreas cultivated a network of relationships to secure foreign deals for his company and protect direct and indirect US government subsidies for many of his products, such as the corn-based ethanol added to gasoline. ’Andreas has been a truly historical figure, a charter member of the world of campaign finance abuses’, said Fred Wertheimer, a lobbyist for campaign finance reform. ‘He may not have paid the price for it, but the country has – through the corrupt system that undermines public trust and provides improper influence for special interests at the expense of citizens and taxpayers’.

"’Archer Daniels Midland . . . has been the most prominent recipient of corporate welfare in recent US history’, said a 1995 study by Cato Institute analyst James Bovard. ‘ADM and its chairman . . . have lavishly fertilised both political parties with millions of dollars in handouts and in return have reaped billion-dollar windfalls from taxpayers and consumers’. Bovard cited federal protection of the domestic sugar industry, ethanol subsidies, subsidised grain exports and other programmes". He gave "lavishly" to both Democrats and Republicans – at one time donating both to Nixon and to his opponent in the 1968 election, Hubert Humphrey.

"Nixon secretary Rose Mary Woods testified in a deposition to the Watergate prosecutors that Andreas delivered an unmarked envelope containing $US100,000 worth of $US100 bills in 1972. As the Watergate investigation closed in on Nixon, the President gave back the money, which had been in a White House safe". He quotes a former ambassador, saying he watched "Andreas hold court for American politicians, Russian apparatchiks and American labour union leaders in his Florida hotel apartment. A Merrill Lynch stock analyst recalls being forced to wait in an outer office while Andreas took a call from Britain’s then Prime Minister"…

To conclude – you will learn a lot more about ADM and that particular set of scandals from “Rats In The Grain” and Watchdog 95 than you will from watching “The Informant!”. More’s the pity, a great opportunity lost to make a mainstream movie showing the ugly truth about transnational corporations and capitalism’s mythical “free market”. Ed.

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Foreign Control Watchdog, P O Box 2258, Christchurch, New Zealand/Aotearoa. December 2009.


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