You Don't Know Jack
By Russell Mokhiber and Robert Weissman
The clock is running out for Jack Welch, CEO of General Electric. It is
also winding down for Don Morrison, a dairy farmer in upstate New York.
For two decades, Welch has led the one-time appliance company,
transforming it into the world's most transnationalized conglomerate with
a finance subsidiary as its profit center. The subject of almost
unqualified adulation from the media and market analysts, he may end his
tenure with a loud thud.
Scheduled to retire this year, Welch extended his reign by an additional
year to oversee GE's gobbling up of Honeywell. European regulators are now
raising serious concerns about the monopolistic effects of the deal, and
appear poised to block it. Welch, who has made his reputation by pushing
all cost-cutting and market-dominating measures to the extreme, may find
that, in his final act, the law and society finally set some limits on
Don Morrison knows all too well the effect of Welch's hard-driving effort
to cut expenses and externalize costs, and he hopes it is not only the
European antitrust regulators who find the spine to stand up to Welch.
The U.S. Environmental Protection Agency (EPA) is expected in August to
issue a final decision on whether it will dredge the Hudson River to clean
up a GE-created PCB mess on the river bed -- at a cost of $460 million to
Until 1976, a broad array of U.S. manufacturers used PCBs (polychlorinated
biphenyls) for insulation in electrical equipment. In 1976, Congress
banned their manufacture and sale, following evidence that PCBs cause
cancer and other harmful health effects. Since the banning, new evidence
suggests PCBs also disrupt the endocrine system and lower intelligence
levels of children exposed in the womb.
From the 1940s to 1976, GE dumped 1.3 million pounds of PCBs into the
Hudson River, creating what is now the nation's largest Superfund site.
Don Morrison knows all about it. "Twenty-five years ago," he says, "the
state dug sludge out of the river, and put it on land adjoining mine. I
figured if they let them put it in the river, it can't be that bad. So it
didn't bother me. ƒ When they asked permission to push it [against my
house], I said sure. My kids played in it, they grew up in it."
Don Morrison's wife died of colon cancer at the age of 49. "We can't prove
it, but we believe that PCB had a tremendous amount to do with it." Now he
lives in fear that his children will suffer from a similar fate.
Morrison and other survivors want GE at least to remedy the problem, 25
years after PCBs were outlawed in the United States.
In December 2000, EPA announced that it agreed, saying that after 16 years
of studies, it had determined to clean up a 40-mile stretch of the Hudson.
Under the Superfund law, GE would be liable for the costs of cleanup.
GE claims that it supports cleaning the river, and that it has acted
responsibly to reduce its daily PCB pollution to three ounces. But it says
dredging will stir up sediments and make the problem worse.
EPA retorts that the ongoing public health and environmental consequences
of the PCB pollution are severe, with PCBs at river bottom continuing to
enter the food chain. New technologies, agency experts say, address
concerns about spreading contaminants by dredging.
But GE isn't just making arguments. In fine Jack Welch style, GE has
pulled out all the stops to block the dredging plan. GE's Hudson River
lobbying dream team includes former Senate Majority Leader George Mitchell
and former House Appropriations Committee Chair Robert Livingston. Among
other hardball tactics, the company deployed NBC President and GE Vice
Chair Robert Wright to lobby New York City Council members against a bill
endorsing the dredging project. (Think direct intervention from the head
of a TV network, which owns a major station in New York, might give GE
GE certainly has lots of friends in the Bush administration, and in the
On the other hand, EPA chief Christine Todd Whitman endorsed the dredging
when she was governor of New Jersey. And the Bush administration is under
pressure not to announce any more environmentally stupid and harmful
policy decisions with an obvious tilt to corporate interests. So the
outcome of the final EPA decision remains very much in doubt.
The GE of Jack Welch has made its mark by pushing it workers, suppliers
and the law to the limit, and often beyond.
But his strategies, though lavishly praised by Wall Street, are basically
inhuman, as Don Morrison and many others can testify.
As Jack Welch's reign comes to an end, it is time for the society to say
the clock has run out on Welch's model of comprehensive and global
management by stress. The first way to deliver that message is for EPA to
authorize the go-ahead of the Hudson dredging, without delay.
Russell Mokhiber is editor of the Washington, D.C.-based Corporate Crime
Reporter. Robert Weissman is editor of the Washington, D.C.-based
Multinational Monitor. They are co-authors of Corporate Predators: The
Hunt for MegaProfits and the Attack on Democracy (Monroe, Maine: Common
Courage Press, 1999).
(c) Russell Mokhiber and Robert Weissman