How Mitt Romney Helped Monsanto Take
Over the World
sept 14, 2012
Today, Monsanto looms over the global ag landscape like
a colossus. It is the globe's largest seed purveyor—and its dominant vendor of
genetically modified traits. How dominant? Here's NPR on the company's mastery
over the US GMO market: "More than 9 out of 10 soybean seeds carry [Monsanto's]
Roundup Ready trait. It's about the same for cotton and just a little lower for
corn." It also sells nearly $1 billion worth of herbicides every three months.
But for all its clout, Monsanto is a relatively new player in the Big Ag game.
While fellow ag giants like ADM, Cargill, Bunge, and BASF have been in the game
for a century or more, as recently as the late 1970s Monsanto was known mostly
as a chemical company; herbicides were a relatively small sideline, and
genetically modified seeds were just the gleam in the eye of a few scientists in
the R&D department. And its flagship chemical business had plunged into crisis.
In 1976, Congress banned the highly toxic industrial coolant PCB—the US
production of which Monsanto had enjoyed what the Washington Post called a
"lucrative four-decade monopoly." According to the Post, Monsanto had been
actively covering up the dangers of PCB exposure for years before the ban,
opening the company to a thicket of lawsuits. To make matters worse, the company
had also been heavily invested in the toxic pesticide DDT (banned in 1972) and
the infamous Vietnam War defoliant Agent Orange—both of which carried their own
legal and public-relations liabilities.
How did Monsanto pivot from teetering, scandal-ridden chemical giant to mighty
high-tech (though still quite controversial) agribiz firm? As the veteran
investigative reporter (and Mother Jones contributor) Wayne Barrett shows in a
new Nation article, a young consultant called Mitt Romney helped push the firm
on its highly lucrative new path. Monsanto first tapped the consulting services
of the Boston-based consulting firm Bain in 1973, the same year Bain launched.
When Romney joined Bain fresh out of Harvard in 1977, he quickly began working
with the ailing chemical firm. Here's Barrett:
Dr. Earl Beaver, who was Monsanto's waste director during the Bain period, says
that Bain was certainly "aware" of the "PCB and dioxin scandals" because they
created "a negative public perception that was costing the company money." So
Bain recommended focusing "on the businesses that didn't have those
perceptions," Beaver recalls, starting with "life science products that were
biologically based," including genetically engineered crops, as well as Roundup,
the hugely profitable weed-killer. "These were the products that Bain gave their
go-ahead to," Beaver contends, noting that Romney was a key player, "reviewing
the data collected by other people and developing alternatives," talking mostly
to "the higher muckety-mucks."
In other words, Romney and Bain played crucial roles in shaping Monsanto's
strategy of selling off big chunks of its legacy chemical businesses and
reinventing itself as ag-biotech firm.
And one of those "higher muckety-mucks," then-Monsanto CEO John W. Hanley, was
so impressed with Romney's work that he helped launch Bain Capital, the spin-off
private-equity firm to which Romney owes his fortune, explicitly as a vehicle to
keep Romney in the Bain fold, Barrett reports. Hanley even placed $1 million of
his own cash in Bain Capital's original investment fund.
There's no mystery why Monsanto would want to distance itself from its old
business lines. As we know from documents that have dribbled out from legal
proceedings over the years, Monsanto had essentially been operating as a
corporate criminal. Here's a 2002 Washington Post article on the company's PCB
business:
[F]or nearly 40 years, while producing the now-banned industrial coolants known
as PCBs at a local factory, Monsanto Co. routinely discharged toxic waste into a
west Anniston [Alabama] creek and dumped millions of pounds of PCBs into oozing
open-pit landfills. And thousands of pages of Monsanto documents—many emblazoned
with warnings such as "CONFIDENTIAL: Read and Destroy"—show that for decades,
the corporate giant concealed what it did and what it knew.
In 1966, Monsanto managers discovered that fish submerged in that creek turned
belly-up within 10 seconds, spurting blood and shedding skin as if dunked into
boiling water. They told no one. In 1969, they found fish in another creek with
7,500 times the legal PCB levels. They decided "there is little object in going
to expensive extremes in limiting discharges." In 1975, a company study found
that PCBs caused tumors in rats. They ordered its conclusion changed from
"slightly tumorigenic" to "does not appear to be carcinogenic."
It's not clear how much Romney knew about these depraved acts in the late 1970s,
but as noted above, the strategy he helped cook up was certainly smart, in a
reptilian, money-making sort of way: Quietly skitter away from the now toxic (in
PR terms) chemical industry, selling old business lines as fast as possible, and
invest the proceeds in a new, shiny, positive-sounding field called
"biotechnology." And specialize in "feeding the world," which sounds a hell of a
lot nicer than dumping carcinogenic gunk in creeks. The strategy was by no means
as obvious as it now seems in hindsight: Monsanto was exiting a steady,
established business, industrial chemicals, in favor of a highly speculative and
new one, ag biotech. But it worked brilliantly—by the time those PCB revelations
came out in 2002, Monsanto could plausibly protect its image by saying, that was
all in the past; we don't make those kinds of chemicals anymore.
Of course, in its new, Bain-ified manifestation, Monsanto 2.0 remained quite
ruthless in its pursuit of profit. As Barrett puts it, the metamorphosis merely
meant "trading one set of environmental controversies for another."
One difference is that Monsanto the ag-biotech giant is having a much better
time with the regulatory agencies than Monsanto the chemical giant did in the
'70s. A President Romney would certainly be a "very old friend in a very high
place" for Monsanto, as Barrett writes, but the current Oval Office inhabitant
is pretty friendly, too. Even as Monsanto's Roundup Ready seed empire gets
increasingly choked by a welter of Roundup-resistant weeds and inspires gushers
of herbicide cocktails, the USDA keeps approving new Roundup Ready products—and
appears on the verge of okaying novel ones that threaten to bring forth even
more superweeds and even more-toxic herbicides.
But then again, Monsanto the chemical giant enjoyed several decades of impunity
before the federal government finally cracked down in the '70s. Perhaps the
agrichemical giant, too, will one day see its regulatory fortunes turn.
http://