Truthdig
Three Massive Mergers-Millions for One Bank and a Disaster for Food, Water
and Climate
http://www.truthdig.com/report/item/three_massive_mergersmillions_for_one_ba
nk_20161024/
AddThis Sharing Buttons
Share to FacebookShare to TwitterShare to MoreShare to Email
Posted on Oct 24, 2016
By Wenonah Hauter / YES!
Magazine(http://www.yesmagazine.org/new-economy/three-massive-mergers-millio
ns-for-one-bank-and-a-disaster-for-food-water-and-climate-20161020)
Protesters at the pipeline construction site on the Standing Rock
reservation. (Rob Wilson Photography)
You probably learned in high school that monopolies are bad for consumers;
they eliminate the field of competition in the marketplace, leaving people
with fewer options and higher prices. Mega-mergers in the food and energy
markets are allowing a handful of corporations to dominate market sectors.
Their market dominance means that when it comes to influencing public
policy, politically powerful companies call the shots. As Elizabeth Warren
said in a speech
recently(http://washingtonmonthly.com/2016/06/30/elizabeth-warrens-consolida
tion-speech-could-change-the-election/) , competition is dying-and the
accompanying consolidation in sector after sector is a threat to our
democracy.
Beyond the corporate quest for market dominance, there is another reason
these mergers keep coming at everyone else's expense: the deals make big
money for the powerful banks that wield enormous power over our democracy.
One such bank is Credit Suisse.
Here are the three most valuable
mergers(https://twitter.com/Dealogic/status/773175056704954368/photo/1)
happening this year: U.S.-based Monsanto is being bought by German
corporation Bayer for $64.5 billion; ChemChina is acquiring Swiss seed and
pesticide company Syngenta for $46.7 billion; and the Canadian pipeline
company Enbridge is attempting to purchase Houston-based Spectra for $43.1
billion.
There is one thing these deals in the works have in common: they are all
being advised by Credit
Suisse(http://www.businessinsider.com/wall-street-payday-banks-are-going-to-
make-close-to-100-million-on-one-of-the-biggest-deals-of-the-year-2016-9) .
And that consultation comes at a hefty price: Enbridge and Spectra are
expected to pay banks nearly $100 million in advisory fees alone. For the
Monsanto-Bayer merger, fees could top $200
million(http://www.businessinsider.com/morgan-stanley-ducera-credit-suisse-b
ank-of-america-on-bayer-monsanto-deal-2016-5) .
What these mergers mean for food, water, and climate
While the business press is all aflutter over all the money to be made by
these mega-mergers, beyond the headlines these deals are a disaster for our
food, water, and climate, not to mention our communities on the front lines
of industrial agriculture and energy infrastructure.
In North Dakota, Credit Suisse is playing a big role behind the scenes,
banking against the Standing Rock Sioux, along with Wells Fargo, Goldman
Sachs, Morgan Stanley, Bank of America, Citigroup, and more. When we
revealed this last
month(http://www.foodandwaterwatch.org/news/who%27s-banking-dakota-access-pi
peline) , we hadn't yet seen a huge separate loan of $850 million
(http://ir.energytransfer.com/mobile.view?c=193925&v=202&d=3&id=aHR0cDovL2Fw
aS50ZW5rd2l6YXJkLmNvbS9maWxpbmcueG1sP2lwYWdlPTEwMTMzOTUxJkRTRVE9MiZTRVE9OTAm
U1FERVNDPVNFQ1RJT05fUEFHRSZleHA9JnN1YnNpZD01Nw%3D%3D) to Energy Transfer,
which is Enbridge's main partner on the Dakota Access pipeline project. The
pipeline jeopardizes the tribe's sole source of water, and yet over the
tribe's objections, it's still being built.
If the Enbridge merger with Spectra goes through, it would make the biggest
energy infrastructure company in North America, with huge political
influence. The company has every intent to maximize the amounts of oil and
gas that can be brought to the surface and burned, using fracking, but this
is at the expense of targeted communities and the stability of our climate.
If the Monsanto and Syngenta mergers go through, Big Agribusiness would have
even more economic power over farmers, increasing the prices they pay and
limiting their choices for seeds and farm inputs. Even more crops will be
grown with dangerous herbicides like glyphosate that have been linked to the
growth of superweeds as well as cancer. And lobbying groups will continue to
sway the debate over GMOs, thanks to their millions of dollars spent on
marketing and misleading
people(http://www.foodandwaterwatch.org/news/five-things-monsanto-doesnt-wan
t-you-know-about-gmos) about so-called benefits while downplaying the
risks.
More market power = more lobbying heft
I've written extensively about mergers in the food and energy industry in my
two books(http://www.wenonahhauter.org/books/) , Foodopoly and Frackopoly.
As companies become more powerful, so does their lobbying heft. This
influence peddling paves the way for deregulation and ever-more
consolidation. Companies basically get to play by their own rules-and people
have to fight that much harder to make their voices heard in our democracy
when this cycle continues.
When you look at food issues from this lens, it's easy to see why our
policies incentivize industrial agriculture and genetically modified
organisms. Even before Ag secretary Earl Butz said farmers need to "get big
or get out" in the early 1970s, our food and farm policy has favored large
industrial interests. A handful of influential players, from Monsanto to
Cargill to Walmart, have enjoyed the spoils-very lax regulations and the
ability to literally buy up their competition. This has led to policies that
have created bigger and badder factory farms, for example, or made it harder
for farmers get a fair price for their products.
The story is not much different in the oil and gas industry. Since the days
of JD Rockefeller, the biggest oil companies have been busy consolidating
their power and stopping environmental progress in its tracks, even going so
far as to cover up the role of burning fossil fuels in climate
change(https://insideclimatenews.org/news/15092015/Exxons-own-research-confi
rmed-fossil-fuels-role-in-global-warming) .
While the banks are making money on these mergers, the water protectors at
Standing Rock are on the front lines-along with many other communities, such
as those in North Carolina, who are now facing the fallout of massive
amounts of factory farm waste
(https://www.washingtonpost.com/news/capital-weather-gang/wp/2016/10/16/fact
ory-farming-practices-are-under-scrutiny-again-in-n-c-after-disastrous-hurri
cane-floods/) flooding communities after Hurricane Matthew. They are
bearing the brunt of the effects of our highly consolidated food and energy
systems. But make no mistake: as a society, we will all suffer from these
mergers, while the banks continue to enjoy record profits and to resist
necessary action on climate change because of their own bottom lines.
Wenonah Hauter wrote this article for YES! Magazine. Wenonah is executive
director of Food & Water Watch(Food & Water Watch) . She is the author of
Frackopoly: The Battle for the Future of Energy and the
Environment(https://www.amazon.com/Frackopoly-Battle-Future-Energy-Environme
nt/dp/1620970074) .
Baseball Architect Theo Epstein Continues Tradition of Turning Lovable
Losers Into Winners
How We Fix the Mess the Democratic Party Establishment Made (Video and
Transcript)
Former Death Row Inmate Calls for Rehabilitative Prison Programs
Latest Oil Pipeline Leak Underscores Dangers of Dakota Access Pipeline
Truthdig: Drilling Beneath the Headlines
C 2016 Truthdig, LLC. All rights reserved.
Signup for Truthdig's newsletter
