Forwarded message: Delivered-To: [EMAIL PROTECTED] Delivered-To: [EMAIL PROTECTED] Date: Fri, 10 Jul 1998 14:25:53 -0700 To: [EMAIL PROTECTED] From: Sid Shniad <[EMAIL PROTECTED]> Subject: The competitor is our friend, the customer is our enemy X-UID: 860 >Date: Fri, 10 Jul 1998 >From: Robert Weissman <[EMAIL PROTECTED]> >Subject: The competitor is our friend, the customer is our enemy > >When you hear politicians blather about free markets, point them to >Chicago, where three former executives of Archer Daniels Midland (ADM) are >in federal court this week to face criminal charges of destroying markets. > >The three former ADM executives, Michael Andreas (son of Chairman Dwayne), >Terrance Wilson and Mark Whitacre have been charged with meeting with >competitors to fix the prices and sales volume of the feed additive >lysine. > >A fourth executive, Kazutoshi Yamada, of the Ajinomoto Company, was also >charged in the conspiracy to fix prices. But Yamada will not appear at the >trial in Chicago to face the charges. When asked why Yamada is not being >extradited, federal officials reply with a limp "no comment." > >ADM and a number of other companies have already admitted their >criminality and paid tens of millions of dollars in fines. > >The price-fixing fits well with chairman Dwayne's philosophy on markets. >As he put it to his son Michael -- "The competitor is our friend and the >customer is our enemy." > >"There isn't one grain of anything in the world that is sold in a free >market," Dwayne told a reporter from Mother Jones in 1995. "Not one! The >only place you see a free market is in the speeches of politicians. People >who are not from the Midwest do not understand that this is a socialist >country." > >The extent of the price-fixing was laid out earlier this year by federal >prosecutors in a little noticed pre-trial proffer filed in Chicago. > >The document quotes extensively from video and audio tapes made by former >ADM executive turned FBI mole turned convict Whitacre. (Whitacre was >convicted earlier this year of stealing millions of dollars from ADM, even >though he claimed that the money was off-the-books compensation.) > >The proffer is startling in its scope. It contains within its 57 pages >perhaps the most concentrated proof of corporate criminality ever >assembled by a federal agency. > >The document, which was compiled by the Justice Department's James >Griffin, argues that the agreement to fix prices was hammered out at a >series of meetings, beginning with a meeting in Mexico City on June 23, >1992. > >The proffer contains large excerpts from tape recordings made by Whitacre >when he was a mole for the FBI. The excerpts are riddled with expletives. > >According to Griffin's proffer, the government will prove at trial that at >the Mexico City meeting, Wilson told other lysine producers "we are not >cowboys, we should be trust(ing) and (have) competitive friendliness." >Wilson points out that low lysine prices were benefitting the customers >rather than the manufacturers. > >After the Mexico City meeting, the companies agreed to raise the U.S. >price of lysine without reaching an agreement on holding down volume. As a >result, the price of lysine increased throughout the summer. > >Another meeting was held in Paris in October 1992. After the Mexico City >and Paris meetings, the price of lysine increased in some places, but not >everywhere. The companies blamed each other for this, they began to bicker >and prices dropped. > >A third meeting was held in Decatur, Illinois -- home to ADM -- on April >30, 1993. > >Prior to the Decatur meeting, Andreas and Whitacre had several strategy >sessions, all of which were taped. > >Wilson and Andreas contended that ADM's sole promise to the other >producers in 1992 was to lower its lysine volume only if the producers >were able to maintain the higher lysine prices they had agreed to. > >During one such conversation, Andreas advised Whitacre: "You could just >say to [Yanamoto, a Japanese competitor] look, these prices are so shitty >.. and you guys are so disorganized that I don't know what kind of shit >you're managing." > >At a March 10, 1994 meeting in Hawaii, the producers complained about each >others' cheating on the fixed prices. Wilson laid out his price-fixing >philosophy: > >"We are gonna get manipulated by these God damn buyers. . .They can be >smarter than us if we let them be smarter ... They are not your friend. >They are not my friend. And we gotta have 'em. Thank God we gotta have >'em, but they are not my friends. You are my friends. I wanna be closer to >your than I am to any customer 'cause you can make us ... money." > >The competitor is our friend, and the customer is our enemy. > >God Bless America. > >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. > >(c) Russell Mokhiber and Robert Weissman > >Focus on the Corporation is a weekly column written by Russell Mokhiber >and Robert Weissman. Please feel free to forward the column to friends or >repost the column on other lists. If you would like to post the column on >a web site or publish it in print format, we ask that you first contact us >([EMAIL PROTECTED] or [EMAIL PROTECTED]). -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [EMAIL PROTECTED]
