Belching Out the Devil
Page 29
Indeed, The Coca-Cola Company’s annual report for 2006 says, ‘Our effective tax rate reflects tax benefits derived from significant operations outside the United States, which are generally taxed at rates lower than the US statutory rate of 35 per cent. Our effective tax rate of approximately 22.8 per cent for the year ended 31 December 2006.’ That year the company profits were US $6,578 million. By putting their business in tax havens the Company’s declared tax paid that year was US $1,498 million. Had they paid tax in the US at 35 per cent the Company would have contributed approximately another US $804 million. So Coke Throat is right in the sense that is does indeed ‘benefit Coca-Cola’.
Back in Ireland there were three plants that made concentrates, Drogheda in the east, Ballina in the west and a small plant in Athy to the south of Dublin. According to the company, Athy and Ballina ‘are sufficient to meet the current and future demand for concentrate and beverage base supply from Ireland’.6 So Drogheda was shut because of overcapacity and Drogheda’s work was moved to Ballina. But according to Jerry there is another agenda going on here, Drogheda is totally unionised and Ballina is totally non-union.
The reason for Ballina being non-union is historic. ‘In the Seventies they had a Japanese plant there and the union there had a strike,’ Jerry tells me. ‘Now the company said “If you don’t report for work on Monday we will shut the plant down.” And everyone said “Oh yeah, that’s what they always say.” But come Monday the plant shut and the company left...’
‘And because of that the community is anti-union…’
‘They blame the union for losing the jobs.’
‘So is SIPTU going to try and form a branch in Ballina?’
‘It is very difficult to get into Ballina…I have spoken to managers and supervisors, the normal people you would expect to talk to about it. They tell you the same thing. “Not interested, Jerry, not interested, Jerry…”’
When I talked to Ron Oswald from the International Union of Foodworkers, a man who deals with Coca-Cola a lot, he was quite blunt about Coke’s operations in Ireland. ‘We think there are sophisticated human resource practices inside these operations which essentially is designed to squeeze the space out from where unions can operate.’
The feeling that the company’s moves were motivated by a degree of antipathy towards the union was compounded by what happened next. The workers from Drogheda finished their final shift on Friday 27 June 2008. On the following Monday morning, 30 June, it was announced that Coca-Cola was to open a new plant in Wexford in the south.7 ‘By which stage it was too late to try and negotiate moving the Drogheda workers to Wexford.’ That chance had gone, and you wouldn’t need to be a cynic to think that the timing of the announcement about the Wexford plant was deliberately chosen to come after Drogheda had closed. Jerry says, ‘There is one reason and one reason only why they do not want Drogheda people there, they do not want a union over there.’
In their defence Coca-Cola point to the fact that the new plant in Wexford is a flavourings plant, which is different from a concentrate plant. But Jerry says ‘Well, if you are trained in one side of the business it won’t be too difficult to train for flavourings.’ Surely retraining experienced Drogheda workers would be preferable from starting with people with no knowledge at all.
There are rumours that the Wexford plant will make 7X the company’s secret ingredient and Coca-Cola management are reported to have said that the company never allows a union into a 7X plant, apparently fearful that if they have a dispute in the flavour plant the worldwide system goes down. So with Drogheda gone the only union members are in Athy. ‘You have about fifty union members, and that is about it for the concentrates side of it, for the whole of Ireland.’
When the closure of Drogheda was announced SIPTU organised demonstrations, Ireland’s national media covered the issue and the union even developed its own rescue package that would save the company some 10 million euros in voluntary redundancies and changes in overtime patterns. None of which had any effect. But as Jerry points out ‘We failed to get the local community on our side, the local community sees Coca-Cola workers as extremely well paid… So was there a lot of sympathy for them? Probably not.’ According to Jerry folk around here have not yet grasped the implications of the plant going, ‘This town does not realise the devastation. That plant brought about 30-40 million euros into the local economy. That is gone.’
Jerry comes from a trade-union family, his father was a union man, his brother Ollie is a shop steward. So, during a family holiday when the three of them were sitting up talking late one night, it came as a surprise when his father questioned him. Jerry’s father had asked, ‘Do you think the company shut the plant down or is it the union that shut the plant?’
‘It took me a while to realise what he was getting at,’ says Jerry, ‘he is a well-known fella about the town, he knows what is going on.’ His father’s question was not so much a question at all but a gentle nudge as to what the town was thinking.
After taking advantage of the tax regime - and it is a fair bet to say that should the tax rate increase to an unfavourable level the company would shift its operations quicker than you could say ‘Is Bono here too?’, after ‘assistance’ from the Irish Development Agency to set up its plants, after reducing the trade union to the margins and after making nearly $6 billion in profit The Coca-Cola Company leaves Drogheda with the community wondering if it was the union that lost the jobs.
Welcome to the World of Coca-Cola.
Acknowledgements
A heartfelt salute goes to Susan McNicholas who agreed to research this book. She was an inspiration to work with and a loyal friend.
Thanks also must go to Conor McNicholas, and Rian too, who put up with my endless calls to Susan at all hours of the night and day.
Martin Herring - who went above and beyond the call of duty, came to India filmed it, never got paid and remains a true friend.
Thanks to: Nicky Branch who was transcript queen, Jess Hurd the comrade photographer, Emilio Rodriguez, Alpkan Birelma. Amit Srivasvta, who has been an enlightening presence and friend, Andy Higginbottom at Colombia Solidarity Campaign, Geoff Atkinson who oversaw the Dispatches documentary on Coca-Cola for Channel 4, Joan, Phoebe, Carrie, Amber, Sally Friedman, Kathy Haywood, Sarah McDonald at Uproar, David Lom, Armando, Eduardo, Sophie, Saroj Dosh and Alice Wynn Wilson at Action Aid, Peter Hirst and the Red Shed, Karen at Travel Matters, Olaf Christiansen, Kerim Yildiz, Mustafa Gundogu, Mel Alfonso, Tracey Moberley, Helen Waghorn, Bipasha Ahmet, Claudia, Lynn Sardinha, Sumita Joseph, Amanda Jordan. Lew Freidman and Nancy Romero - special thanks for looking after my family in Brooklyn, Ray Rogers, Jerad, Bernardo, Liam and Jaime for extended Brooklyn support, the Polaris Institute, Mariela Kohon at Justice for Colombia, Arife and Ronnie, Bijoy, Sandeep Panday, Nandlal Master, Santosh, Anita Komanduri, Kavaljit Singh, Nick Hildyard at the Corner House for advice and late-night support, Pablo Leal without whom stuff would not have happened, Alejandro Calvillo, Octavio, Joy and Damaso, Antonino García, Laura Jordan, Jason Parkinson, Guy Smallville, Tony Pletts, Ed Smith, Matthew Harvey, Amy Hopwood, Jeff and the list, Wendy, Andrea, Catherine Strauss and Michael Cummins who are bound to have helped somewhere along the line, Steve Mather and Charlie Allen at Hands Off Venezuela. Hannah MacDonald and Ken Barlow at Ebury Press, Justine Taylor for patient copyediting, Amanda Telfer for smoothing out the legal wrinkles and Sarah Bennie for waving at me on the M5.
As always CB, IJ and Gan Gan xxx
Appendix A: Endnotes
Prologue
1 Manifesto for Growth, The Coca-Cola Company website, www.thecoca-colacompany.com/ourcompany/manifesto_for_growth.html
2 Obesity Report, House of Commons Health Committee, www.publications.parliament.uk/pa/cm200304/cmselect/cmhealth/23/23.pdf
3 The Coca-Cola Company Press Center, www.thecoca-colacompanycom/presscenter/viewpoints_india_situation.html.
Chapter 1: The Happiness Factory
1 ‘Another Tr
im In Spending’, New York Times, 27 June 2007
2 Global Policy Forum
3 US Congressional Budget Office, Testimony before the Committee on the Budget, US House of Representatives, 24 October 2007
4 www.cia.gov/library/publications/the-world-factbook/print/li.html
5 Best Global Brands 2007, Interbrand/Business Week
6 The song was later re-recorded and the brand name removed to create ‘I’d Like to Teach the World to Sing’
7 Atlanta Development Authority Quarterly Report, 18 May 2005, www.atlantada.com/media/1Q2005.pdf
8 ‘Business As Usual, Unfortunately’, The Atlanta Journal-Constitution, 29 March 2005
9 ‘City Oks Bond Issue’, The Atlanta Journal-Constitution, 9 June 2005
10 www.coca-cola.co.uk/Company_History/
11 Mark Pendergrast, For God, Country, and Coca-Cola, London: Weidenfeld & Nicolson, 1994
12 Martin Luther King, ‘I’ve been to the Mountaintop’, 3 April 1968, Mason Temple, Memphis
13 ‘Coke Settles Bias Lawsuit for $192.5 million’, USA Today, 17 November 2000
14 www.gettherealfacts.co.uk/docs/gmbh.pdf
15 ibid
16 www.globalwaterchallenge.org/partners/partners.php
17 ibid
18 Best Global Brands 2007, Interbrand/Business Week
19 Best Global Brands 2006, Interbrand/Business Week
20 Best Global Brands 2005, Interbrand/Business Week
Chapter 2: Give ’Em Enough Coke
1 www.alertnet.org/printable.htm?URL=/db/crisisprofiles/CO_DIS.htm
2 ‘Colombia Paramilitary Chief Says Businesses Back Him’, New York Times, 7 September 2000
3 www.amicustheunion.org/default.aspx?page=8139
4 www.hrw.org/reports/2001/colombia/1.htm669C8B63. Readers should note that the Colombian army now has created a 6th Division, so if the report were written today I would imagine it would now be entitled the 7th Division
5 ‘Colombia Paramilitary Chief Says Businesses Back Him’, New York Times, 7 September 2000
6 Congressional Testimony on Violence against Trade Unionists and Human Rights in Colombia, Human Rights Watch, 28 June 2007
7 www.tuc.org.uk/international/tuc-13722-f0.cfm
8 ‘Colombia’s Uribe ends Washington visit with fate of free trade agreement still uncertain’, International Herald Tribune, 4 May 2007, www.iht.com/articles/ap/2007/05/04/america/NA-GEN-US-Colombia.php
9 www.amicustheunion.org/default.aspx?page=8139
10 Distorted perceptions of Colombia’s conflict, Garry Leech, Colombia Journal, 1 June 2008, referencing Adam Isacson, ‘CINEP: Colombia’s Conflict Is Far from Over,’ Center for International Policy, 10 April 2008, www.reliefweb.int/rw/RWB.NSF/db900SID/KKAA-7F89EE?OpenDocument
Chapter 3: Serious Charges
1 Workplace Assessment in Colombia, Cal Safety Compliance Corporation 2005, www.cokefacts.com/citizenship/cit_co_assessmentReport.pdf
2 ibid
3 ibid
4 ‘Coca-Cola sued over bottling plant “terror campaign”’, Guardian, 21 July 2001, www.guardian.co.uk/world/2001/jul/21/julianborger
5 SINALTRAINAL v THE COCA-COLA COMPANY, news.lp.findlaw.com/hdocs/docs/cocacola/clmbiacocacola72001.pdf
6 Coca-Cola FEMSA is the Mexican multinational that bought Panamco in December 2002 creating the world’s second- largest Coke bottling company, behind Atlanta-based Coca-Cola Enterprises
7 ‘An Investigation of Allegations of Murder and Violence in Coca-Cola’s Columbian plants’, The New York City Fact-Finding Delegation on Coca-Cola in Colombia, January 2004 killercoke.org/pdf/monsfinal.pdf
8 ibid
9 ibid
10 ‘Energy giant agrees settlement with Burmese villagers’, Guardian, 15 December 2004
11 ‘Yahoo Settles With Chinese Journalists’, New York Times, 14 November 2007
12 www.socialfunds.com/news/article.cgi/2353.html
13 ‘Feinstein Fights McCain on Burma Tax Break for Big Oil’, New York Sun, 6 June 2008, www.nysun.com/foreign/feinstein-fights-mccain-on-tax-break-for-big-oil/79452/
14 www.earthrights.org/campaignfeature/senator_feinstein_puts_breaks_on_anti-atca_bill_s._1874.html
15 ‘Coca-Cola sued over bottling plant “terror campaign”’, Guardian, 21 July 2001, www.guardian.co.uk/world/2001/jul/21/julianborger
16 fl1.findlaw.com/news.findlaw.com/hdocs/docs/cocacola/clmbiacocacola72001.pdf p. 14
17 ibid, p. 15
18 news.bbc.co.uk/1/hi/business/2909141.stm
19 www.cokefacts.com/facts/facts_co_court_new.pdf
20 ‘Dismissal Of Coke Lawsuit To Be Appealed’, International Business Times, 3 November 2006, www.ibtimes.com/articles/20061103/apfn-colombia-coca-cola-lawsuit.htm
Chapter 3.5: The Hush Money That Didn’t Stay Quiet
1 www.thecoca-colacompany.com/citizenship/strategic_vision.html
2 The New York City Fact-Finding Delegation on Coca-Cola in Colombia, January 2004, killercoke.org/pdf/monsfinal.pdf
3 www.thecoca-colacompany.com/ourcompany/ar/financialoverview.html
4 www.guardian.co.uk/media/2006/aug/18/marketingandpr.business
5 www.newsdesk.org/archives/004005.html
6 www.gettherealfacts.co.uk/index.html
7 Ed Potter interview with author
8 Email from The Coca-Cola Company to author
9 ibid
10 Interview conducted by author
11 Email from The Coca-Cola Company to author
Chapter 4: ‘Chile’
1 fl1.findlaw.com/news.findlaw.com/hdocs/docs/cocacola/clmbiacocacola72001.pdf p. 26
2 ibid
3 The defendant is listed as Panamco Colombia (d/b/a Embottellador de Santander, S.A.). Panamco was bought by Coca-Cola FEMSA in 2003. In turn, The Coca-Cola Company owns 31.6 per cent of Coca-Cola FEMSA, www.b2i.us/profiles/investor/fullpage.asp?f=1&BzID=994&to=cp&Nav =0&LangID=1&s=0&ID=1940#COCACOMPANY) although it ‘indirectly owns 39.6% of our capital stock, representing 46.4% of our capital stock with full voting rights.’ www.b2i.us/profiles/investor/fullpage.asp?f=1&BzID=994&to=cp&Nav=0&LangID=1&s=0&ID=1940#COCACOMPANY
4 fl1.findlaw.com/news.findlaw.com/hdocs/docs/cocacola/clmbiacocacola72001.pdf, p. 28
5 Email from The Coca-Cola Company to author
6 Coca-Cola’s Global Workplace Rights Policy, www.thecoca-colacompany.com/citizenship/workplace_rights_policy.html
7 Coca-Cola’s Global Workplace Rights Homepage, www.thecoca-colacompany.com/citizenship/workplace_rights.html
8 www.cokefacts.com/Colombia/facts_co_keyfacts.shtml
9 ‘The Political Economy of Labor Reform in Colombia’, Background paper prepared for the World Development Report 2005, www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2005/01/31/000090341_20050131101310/Original/314340Echeverr14WDR050bkgd01public1.doc
10 Interview conducted by author
11 Labour Rights and Freedom of Association in Colombia, Colombian Trade Union Federations, October 2007
12 I asked the Company what was the ratio of permanent to casual labour but they ignored my question completely. However, the figures Sinaltrainal give do reflect a nationwide trend in Colombia to put an increasingly large number of workers into casual or temporary employment
13 www.scottish.parliament.uk/business/businessbulletin/bb-06/bb-12-22f.htm
14 Get The Real Facts, The Coca-Cola Company website, www.gettherealfacts.co.uk/workplace/workplace.html
Chapter 5: The Days of the Great Coke Pledge
1 The Facts: Coca-Cola and Colombia, Coca-Cola website www.cokefacts.com/Colombia/facts_co_colombia_fact_sheet.pdf
2 ibid
3 www.cci.com.tr/en/index.asp
4 Coke Facts: The Truth About The Coca-Cola Company Around the Globe, Coca-Cola website, www.cokefacts.com/facts/facts_aw_keyfacts.shtml
5 lrights.igc.org/projects/corporate/coke/turkeycoke_complaint_part_1.pdf page 10
6 lrights.igc.org/projects/corporate/coke/turkeycok
e_complaint_part_1.pdf
7 Kurdish Human Rights Project
8 Coke Facts: The Truth About The Coca-Cola Company Around The Globe, Coca-Cola website, www.cokefacts.com/facts/facts_aw_keyfacts.shtml
9 ibid
10 ibid
11 lrights.igc.org/projects/corporate/coke/turkeycoke_complaint_part_1.pdf page 13
12 ibid
13 Coke Facts: The Truth About The Coca-Cola Company Around the Globe, Coca-Cola website, www.cokefacts.com/facts/facts_aw_keyfacts.shtml
Chapter 6: May Contain Traces of Child Labour
1 Coca-Cola website, www.gettherealfacts.co.uk/workplace/workplace.html
2 Coca-Cola website, www.letsgettogether.co.uk/ListQuestionsOfTopic/TopicId=24/
3 El Salvador Turning a Blind Eye, Hazardous Child Labor in El Salvador’s Sugarcane Cultivation, June 2004, hrw.org/reports/2004/elsalvador0604/elsalvador0604simple.pdf
4 Coca-Cola website, www.gettherealfacts.co.uk/workplace/workplace.html
5 ‘El Salvador Scarred by Child Labor’, Washington Post, 10 June 2004
6 Children for Hire: The Perils of Child Labor in the United States, Marvin J. Levine, Greenwood Publishing Group, 2003