The Political Economy of
a Narco-Terror State
Colombia and corporate profits
by Rachel Guevera
The Progressive magazine,
Colombia is an extreme example of the
local oligarchy colluding with multi-national corporations and
U.S. militarism to make grotesque profits while the people and
environment are devastated. Billions of dollars from the U.S.
and the drug cartels are keeping the people from overthrowing
the oligarchy, which kills 5,000 to 10,000 people every year.
More than half of all legal Colombian exports travel to the U.S.-if
you add the value of cocaine and heroin, the percentage goes to
80. Colombia has become a lucrative profit center for the U.S.,
one based on violence and ecological destruction. The Colombian
oligarchy is the business partner for many U.S. corporations and
it is the ally of the U.S. and its foreign policy.
CZN and Exxon-Mobil Corporation
This Texas-based mega-corporation is also
known as Exxon-Mobil Coal and Minerals, Imperial Oil, ESSO and
Monterrey Coal Company, Compania Minera Disputada de Las Condes
Limitada (Chile), Intercor (Colombia), and dozens of other companies
that produce a wide range of chemicals, plastics, and consumer
products. With $1.4 billion in revenues from its Colombian operations
in 2000, ExxonMobil was the second largest corporation in Colombia
after the state-owned Ecopetrol. It no longer holds that title
since it sold the massive Cerrejon Coal mine to CZN and its copper
mining operations to Anglo-American this year.
Colombia is the fourth largest exporter
of coal. For the last 15 years an average of 15 million tons per
year has been extracted from the opencast El Cerrejon Coal Mine
under its subsidiary Intercor. It is one of the largest open-pit
mines in the world (30 miles long). The CZN Consortium purchased
Intercor and Exxon's share in April. The area of the mine is inhabited
by the Wayuu Indians who have opposed the mine since 1980. At
the start 5,000 Indians were employed, but most of them were dismissed
when the mine began operations two years later. In 1988 the last
Indians were fired for union activities. Intercor evicted all
residents of the indigenous community of Tabaco to make way for
the expansion of the mine. Residents are resisting and claim that
the relocation arrangements made would break up communities and
not give people sufficient funds to buy land to live on. The Colombian
army guards the mine and has assisted strike-breaking in the past.
To extract the coal, Exxon sucked up the
groundwater, dried up the rivers, and, in the process, denuded
the grasslands on which the Wayuu depend for subsistence. Indians
have also suffered from respiratory diseases caused by coal dust
and heavy noise pollution. An international campaign organized
by Greenpeace is targeting Exxon-Mobil as one of the main obstacles
to greenhouse gas reductions. Twenty-one percent of stockholders
recently voted for Exxon-Mobil to adopt a renewable energy plan.
CZN also has mining operations in Cerrejon Central and they are
actively pursuing new mining opportunities in Cerrejon Sur. Mine
expansions are imminent.
Drummond has fallen from the 318th largest
private company in 1999 to a rank of 492. In 2001 it generated
revenues of $615 million with 2,800 employees. It mines coal,
produces coke, and develops real estate. Drummond's ABC Coke plant
in Tarrant, Alabama is the largest single producer of foundry
coke in the U.S. Most of Drummond's coal and profits come from
the La Loma mine in the Cesar region. Each year Drummond exports
about six million tons of coal from Colombia to U.S. electrical
Ligia Ines Alzate, a longtime labor activist
and general secretary of the Confederation of Trade Unions for
the state of Antioquia, toured the U.S. and spoke to groups in
Alabama in April. A Colombian union, Sintramienergetica, has sued
Drummond Co. in federal court claiming that Drummond hired hit
men to kidnap, torture, and murder three men last year for their
ties to the union that represents Drummond workers. Alzate said
many foreign multinational companies hire paramilitary groups
to target union leaders during contract negotiations or when restless
workers protest company practices. Coca Cola is also being sued
for encouraging death squads to kill union members. The United
Mine Workers and the United Steel Workers Unions support the lawsuit
Dole Food Company Inc.
Dole is the leading producer and supplier
of fresh fruit and vegetables and a leader in the production of
bananas and pineapples (2001 revenues of $4.5 billion). It has
been expanding into fresh-cut flower production and markets a
growing line of packaged foods. Dole is the largest employer in
Colombia and employs 51,000 workers in Latin America on 44,000
hectares of prime farmland. They control banana production in
Colombia and in 1998 they bought 25 percent of the flower cultivation
industry. Colombia is the second largest exporter of flowers in
the world. Two-thirds of fresh-cut flowers sold in the United
States come from Colombia. Dole is the largest producer of fresh
flowers in Latin America with over 90 percent of production shipped
into North America.
The industry has hurt the environment
of a central savanna where most of the flowers are grown. Aquifers
there have dried up, requiring water to be brought in from Bogota.
Toxic residues from pesticides banned in Europe have turned up
in groundwater. One-fifth of the chemicals used in the Colombian
industry's greenhouses have been restricted in the United States
for health reasons (Aldicarb, DDT, Lindane, Aldrin, and Metomil).
Studies by local nongovernmental organizations have found that
nearly two-thirds of Colombian flower workers suffer from peculiar
illnesses, ranging from nausea to miscarriage. Dole employs 11,133
mostly women workers in the Colombian flower industry. Many make
less than 60 cents an hour and women who become pregnant are immediately
terminated from their jobs. Last year Dole agreed to participate
in an environmental standards program, but the government provides
no effective monitoring or enforcement of the standards.
The IUF, an international union of agricultural
and restaurant workers, has been waging a campaign for a year
now against Dole Food. This dispute originated over Dole's treatment
of banana workers and subcontracted cooperatives in the Philippines.
Dole gets about 40 percent of its bananas from Colombia and Ecuador.
In Ecuador Dole is considered the largest employer of child labor
and is active in resisting unions and improvements in working
conditions. In mid-July Dole agreed to pay $24 million to 3,000
Honduran banana workers exposed to sterility and cancer causing
pesticides used on company plantations over the last 30 years.
Colombia's President Alvaro Uribe has
named former Ecopetrol board member Isaac Yanovich to head the
state oil firm. He replaces outgoing Ecopetrol president, Alberto
Calderon. Oil is Colombia's biggest foreign exchange earner and
the government's top source of revenue. Calderon has signed 60
exploration agreements with foreign companies in the past 30 months.
Oil generates $2 billion in government revenue a year. Colombia's
Congress has slashed the amount of royalties oil companies must
pay the state on newly discovered oil fields from 16 percent to
Foreign firms say that lower royalties
are crucial to continue doing business in Colombia, where kidnappings
and attacks on pipelines by guerrillas, who have fought the government
for 38 years, drive up operational costs and scare off investment.
The city of Barrancabermeja is home to
Colombia's largest oil refinery where 70 percent of oil exports
flow down the Magdalena River. Paramilitaries have intensified
a terror campaign, murdering hundreds of civilians in the last
year. In June, USO oil union workers went on strike to protest
the assassination of union officer, Cesar Blanco. Two hundred
and one unionists were killed in Colombia in 2001-more than 80
percent of the world total.
An international consortium led by Canadian
Occidental Petroleum expects as much as 300 million barrels from
a new oil field called Boqueron-the nation's third-largest deposit.
Other major investors in Colombian oil have included Exxon, Shell,
and Elf Aquitane. They have helped boost oil production 80 percent
over the last decade.
Ecopetrol diverts most of its profit to
federal and local governments, but Colombians see little benefit.
Officials face pressure from guerrillas and right-wing paramilitaries
to pay protection money. Many officials steal or squander the
money. Arauca, a boomtown about 25 miles from the Cano Limon oil
field, has received millions of dollars annually in oil royalties
but is ringed by shantytowns. In a petroleum-rich central valley
known as the Middle Magdalena, more than 70 percent of the 750,000
inhabitants live in poverty and nearly 40 percent are unemployed,
double the official nationwide rate.
BP Amoco (British Petroleum)
Colombia's biggest foreign investor is
BP Amoco, formed when British Petroleum merged with Chicago-based
Amoco in I 998. The London-based giant controls Colombia's largest
oil field, a 1.5-billion-barrel trove called Cusiana Cupiagua
in the northeastern province of Casanare. This region produces
almost half of Colombia's total crude output of 60O,000 barrels
a day. The oil fields are operated by BP, which has a 19 percent
share in the project. France's Total-Fina-Elf has 19 percent and
Triton Energy of the United States-a subsidiary of Amerada Hess
Corp-has I 2 percent, Ecopetrol owns 50 percent of the project.
A 444-mile pipeline called Ocensa carries BP Amoco oil to the
Caribbean port of Covenas for export.
BP and Ecopetrol are studying whether
to spend $130 million on a plant to allow them to sell natural
gas from Cusiana-Cupiagua. The Chuchupa field, operated offshore
off the Caribbean coast by Chevron-Texaco Corp, has similar reserves
to Cusiana-Cupiagua and produces most of Colombia's current gas
supply. BP maintains close ties with a number of right-wing paramilitaries
who it helped train in the early 1990s.
Occidental (OXY) Petroleum
This Delaware corporation based in Los
Angeles and Houston operates the Cano-Limon pipeline in northeastern
Colombia. The Cano-Limon is 480 miles long and was bombed 79 times
in 1999 by guerrillas (more than 1,000 bombings since it was built
in 1986). Oxy claims to have lost $100 million since 1995 because
of guerrilla attacks. At Bush and OXY's urging, the U.S. Congress
passed a military appropriations bill that includes an additional
$98 million to pay for security on the pipeline. The new aid package
constitutes a public revelation of Bush's shift from the pretense
of fighting the war on drugs to a strategy of counter-insurgency.
This aid will save OXY the $30 million a year it has spent protecting
the pipeline since the mid-1990s.
Colombia is the 7th largest supplier of
oil to the U.S. and has the largest untapped pool of petroleum
in the Western Hemisphere. Al Gore controls up to $1 million of
family stock in Occidental. Lawrence P. Meriage, Occidental's
public-affairs vice president, not only pushed for Plan Colombia
last year, but also urged a House subcommittee to extend military
aid to the nation's north to "augment security for oil development
They have temporarily pulled out of the
disputed U'wa territory because of international publicity and
pressure from their main stockholder: Sanford and Bernstein-parent
company Alliance Capital. Another big scandal with OXY involved
its Florida-based subcontractor AirScan who directed the cluster
bomb attack of Santo Domingo near the Cano-Limon pipeline in Colombia.
This attack resulted in the deaths of nine children and nine other
civilians in 1998. Investigations continue into this massacre.
Across the border in Ecuador, OXY is a
partner in the OCP petroleum pipeline-one of the most destructive
and potentially catastrophic projects in the Andes. This pipeline
cuts through one of the most biologically diverse regions in the
world. Mud slides and earthquakes are frequent threats to the
area and now there will be crude oil flowing through it.
DynCorp is one of the largest private
contractors for the U.S. armed forces with 2001 revenues of $1.8
billion; up 34.5 percent for the year. It has assets of $644 million
and 2001 profits of $102 million. DynCorp is the 121st largest
private firm in the world and performs technical and consulting
services, including aviation maintenance, logistical support,
telecommunications, information systems, weapons testing, and
management. In 2001 DynCorp received a $600 million contract for
Colombian fumigation and $35 million for related services, says
senior U.S. official Andy Higginbottom.
Many of the DynCorp executives are former
CIA or military personnel, others were formerly of Enron or Citigroup.
The coca spraying campaign is directed by Rand Beers, assistant
secretary for the department of state's division of International
Narcotics and Law Enforcement Affairs and the state department's
secretive Air Wing. DynCorp and its contractor, Eagle Aviation
Services and Technology (EAST), have made millions of dollars
spraying Monsanto's Roundup-Ultra (Glyphosate) over millions of
acres of jungle and farmlands in Colombia. UK-based ICI recently
pulled their soapy surfactant ingredients out of the spray mixture
over concerns about liability and bad publicity. T.D. Allman in
Rolling Stone magazine said of DynCorp's subcontractor EAST, "Once
upon a time these pilots and crews were called mercenaries. Today
they're known as contract personnel. Many come from U.S. involvement
in clandestine warfare in Cuba and Central America" (May
EAST Inc. is headquartered at Patrick
Air Force Base, Florida. Here fumigation pilots are trained by
the state department's Bureau of Narcotics and International Law
Enforcement. EAST is incorporated in several U.S. states, but
has refused to discuss its operations in Colombia.
Based out of Landria military base in
Colombia, Blackhawk choppers fly cover for fumigation pilots.
Despite these escorts, American pilots flying Vietnam-era Bronco
DV- I 0s over the FARC-EP-dominated Caqueta Department recently
chose to abort their spray mission when they encountered heavy
fire from the guerrillas.
DynCorp's contracts with the CIA include
covert work in Colombia and Peru, according to James Woolsey,
former head of CIA, at Senate hearings. Several DynCorp employees
have been investigated for drug trafficking and it is common knowledge
in Colombia that these U. S. subcontractors consume hard drugs
and are above the law.
EAST has a long history of CIA and clandestine
operations. DynCorp has been awarded hundreds of millions of dollars
in defense contracts in the U.S. and in Bosnia and scandals follow
their every step. The spraying of defoliants has damaged vast
areas of food crops and sensitive habitat. The International Labor
Rights Fund has filed suit in U. S. federal court on behalf of
10,000 Ecuadorian peasant farmers and Amazonian Indians charging
DynCorp with torture, infanticide, and wrongful death for its
role in the aerial spraying in the Amazonian jungle, along the
border of Ecuador and Colombia.
Military Personnel Resources Inc.
Insiders joke that MPRI has more generals
than the Pentagon. This high level mercenary group has over 1,000
elite military and law enforcement leaders on retainer, including
General Ed Soyster, former head of the Defense Intelligence Agency,
General Frederick Kroesen, former commander of the U.S. Army in
Europe and a former assistant director of the FBI. Many of its
employees serve on the Council of Foreign Relations. The president,
Carl Vuono, was the army chief of staff during the invasion of
Panama and the Gulf War. He retired after the war and joined MPRI
in 1991. One of his first big jobs was advising the Croatian government
when it split from Yugoslavia. He is credited with the victorious
military strategy of the lightning armor drives used against the
MPRI is a military consultancy and supplies
pilots, Special Forces, and elite training and security services
worldwide. They recently completed an $800,000 contract to advise
the Colombian military.
The Colombian Government Inc.
Every NGO, international agency, and most
U.S. State Department and DEA reports agree that an axis of evil
has united against the leftist FARC-EP and the poor people of
Colombia to maintain the status quo of violence and drug dealing.
The U.S. played a decisive role in establishing this nexus when
it brought the AUC into the "killer networks" that the
U.S. established in 1991. Without massive U. S. financial support
the corrupt Colombian government would have fallen to the FARC
The UN Office for Drug Control and Crime
Prevention says, " Deforestation caused by coca and opium
cultivation is close to 340,000 hectares. Each hectare of coca
costs four hectares of Amazon forest." When vegetation is
cut on slopes, the water supply downstream is affected, in addition
to a loss of some 120-230 tons of topsoil per hectare. Pollution
of water sources results from use of herbicides and fertilizers
applied to the drug crops, and from solvents and chemicals used
in drug refinement "20 million liters of ethyl ether, acetone,
ammonia, sulphuric acid and hydrochloric acid are discarded from
laboratories into the tributaries that feed the Amazon and Orinoco
rivers-endangering 350 Andean floral species, 210 animal species,
600 birds species, 170 reptiles, 100 amphibians, and 600 fish
species in the Amazon and Orinoco alone."
A phony drug war has become a bloody large-scale
anti-guerrilla campaign that is guaranteed to devastate the flora,
fauna, and the peasants, while making Colombia safe for massive,
coal, oil, and mineral extraction for U . S. markets. War crimes
lawsuits are pending against U.S. barbarity.
War on Drugs