The 182 Percent Loan: How Installment Lenders Put Borrowers in a World of Hurt

Katrina Sutton of McDonough, Ga., stands outside the World Finance storefront where she took out an installment loan in August 2009. (Erik S. Lesser/EPA for ProPublica)

by Paul Kiel
ProPublica, May 13, 2013, 9 a.m.

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One day late last year, Katrina Sutton stood at a gas pump outside Atlanta and swiped her debit card. Insufficient funds. But that couldn't be. She'd been careful to wait until her $270 paycheck from Walmart had hit her account. The money wasn't there? It was all she had. And without gas, she couldn't get to work.

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Inside World Finance Loans

by Paul Kiel and Krista Kjellman Schmidt, ProPublica, May 13

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A World Finance Contract Illustrated

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The Problem Behind the Big Business of Installment Loans

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She tried not to panic, but after she called her card company, she couldn't help it. Her funds had been frozen, she was told, by World Finance.
Sutton lives in Georgia, a state that has banned payday loans. But World Finance, a billion-dollar company, peddles installment loans, a product that often drives borrowers into a similar quagmire of debt.
World is one of America's largest providers of installment loans, an industry that thrives in at least 19 states, mostly in the South and Midwest; claims more than 10 million customers; and has survived recent efforts by lawmakers to curtail lending that carries exorbitant interest rates and fees. Installment lenders were not included in a 2006 federal law that banned selling some classes of loans with an annual percentage rate above 36 percent to service members — so the companies often set up shop near the gates of military bases, offering loans with annual rates that can soar into the triple digits.
Installment loans have been around for decades. While payday loans are usually due in a matter of weeks, installment loans get paid back in installments over time — a few months to a few years. Both types of loans are marketed to the same low-income consumers, and both can trap borrowers in a cycle of recurring, expensive loans.
Installment loans can be deceptively expensive. World and its competitors push customers to renew their loans over and over again, transforming what the industry touts as a safe, responsible way to pay down debt into a kind of credit card with sky-high annual rates, sometimes more than 200 percent.
And when state laws force the companies to charge lower rates, they often sell borrowers unnecessary insurance products that rarely provide any benefit to the consumer but can effectively double the loan's annual percentage rate. Former World employees say they were instructed not to tell customers the insurance is voluntary.
When borrowers fall behind on payments, calls to the customer's home and workplace, as well as to friends and relatives, are routine. Next come home visits. And as Sutton and many others have discovered, World's threats to sue its customers are often real.
The Consumer Financial Protection Bureau, the new federal agency charged with overseeing consumer-finance products and services, has the power to sue nonbank lenders for violating federal laws. It could also make larger installment lenders subject to regular examinations, but it hasn't yet done so. Installment companies have supported Republican efforts to weaken the agency, echoing concerns raised by the lending industry as a whole.
The CFPB declined to comment on any potential rule-making or enforcement action.
Despite a customer base that might best be described as sub-subprime, World comfortably survived the financial crisis. Its stock, which trades on the Nasdaq under the company's corporate name, World Acceptance Corp., has nearly tripled in price in the last three years. The company services more than 800,000 customers at upward of 1,000 offices in 13 states. It also extends into Mexico, where it has about 120,000 customers.
In a written response to questions for this story, World argued that the company provides a valuable service for customers who might not otherwise qualify for credit. The loans are carefully underwritten to be affordable for borrowers, the company said, and since the loans involve set monthly payments, they come with a "built-in financial discipline."
The company denied that it deceives customers, saying that it trains its employees to tell borrowers that insurance products are voluntary and that it also informs customers of this in writing. It said it contacts delinquent borrowers at their workplace only after it has failed to reach them at their homes and that it resorts to lawsuits to recoup delinquent payments in accordance with state laws.
"World values its customers," the company wrote, "and its customers demonstrate by their repeat business that they value the service and products that World offers."
The installment industry promotes its products as a consumer-friendly alternative to payday loans. Installment loans are "the safest form of consumer credit out there," said Bill Himpler, the executive vice president of the American Financial Services Association, of which World and other major installment lenders are members.
About 5 percent of World's customers, approximately 40,000, are service members or their families, the company said. According to the Defense Department, active-duty military personnel and their dependents comprise about 1 percent of the U.S. population.

The Starter Loan

Katrina Sutton’s loan contract. Although she walked out of the World Finance store with a check for $207, she agreed to pay a total of $350, including interest, fees and insurance. (Erik. S. Lesser/EPA for ProPublica)

Back in August 2009, Sutton's 1997 Crown Victoria needed fixing, and she was "between paychecks," as she put it. Some months, more than half of her paycheck went to student-loan bills stemming from her pursuit of an associate degree at the University of Phoenix. Living with her mother and grandparents saved on rent, but her part-time job as a Walmart cashier didn't provide much leeway. She was short that month and needed her car to get to work.
She said she happened to pass by a World Finance storefront in a strip mall in McDonough, Ga. A neon sign advertised "LOANS," and mirrored windows assured privacy. She went inside.
A credit check showed "my FICO score was 500-something," Sutton remembered, putting her creditworthiness in the bottom 25 percent of borrowers. "But they didn't have no problem giving me the loan."
She walked out with a check for $207. To pay it back, she agreed to make seven monthly payments of $50 for a total of $350. The loan papers said the annual percentage rate, which includes interest as well as fees, was 90 percent.
Sutton had received what World employees call a "starter loan." That's something Paige Buys learned after she was hired to work at a World Finance branch in Chandler, Okla., at the age of 18. At that point, she only had a dim notion of what World did.
At 19, she was named branch manager (the youngest in company history, she remembered being told), and by then she had learned a lot. And the more she understood, the more conflicted she felt.
"I hated the business," she said. "I hated what we were doing to people. But I couldn't just quit."
The storefront, which lies on the town's main artery, Route 66, is very much like the one where Sutton got her loan. Behind darkened windows sit a couple of desks and a fake tree. The walls are nearly bare. Typical of World storefronts, it resembles an accountant's office more than a payday loan store.
Buys said any prospective borrower was virtually guaranteed to qualify for a loan of at least $200. Low credit scores are common, she and other former employees said, but World teaches its employees to home in on something else: whether at least some small portion of the borrower's monthly income isn't already being consumed by other debts. If, after accounting for bills and some nominal living expenses, a customer still has money left over, World will take them on.
In its written response, World said the purpose of its underwriting procedures was to ensure that the borrower has enough income to make the required payments.
With few exceptions, World requires its customers to pledge personal possessions as collateral that the company can seize if they don't pay. The riskier the client, the more items they were required to list, former employees say.
Sutton offered two of her family's televisions, a DVD player, a PlayStation and a computer. Together, they amounted to $1,600 in value, according to her contract. In addition, World listed her car.
There are limits to what World and other lenders can ask borrowers to pledge. Rules issued in 1984 by the Federal Trade Commission put "household goods" such as appliances, furniture and clothing off limits — no borrower can be asked to literally offer the shirt off his back. One television and one radio are also protected, among other items. But the rules are so old, they make no mention of computers.
Video game systems, jewelry, chainsaws, firearms — these are among the items listed on World's standard collateral form. The contracts warn in several places that World has the right to seize the possessions if the borrower defaults.
"They started threatening me," a World customer from Brunswick, Ga., said. "If I didn't make two payments, they would back a truck up and take my furniture, my lawn mower." (In fact, furniture is among the items protected under the FTC rule.) The woman, who asked to remain anonymous because she feared the company's employees, was most upset by the prospect of the company taking her piano. She filed for bankruptcy protection last year.
In fact, former World employees said, it was exceedingly rare for the company to actually repossess personal items.
"Then you've got a broken-down Xbox, and what are you going to do with it?" asked Kristin, who worked in a World branch in Texas in 2012 and, from fear of retaliation, asked that her last name not be used.
World supervisors "would tell us, 'You know, we are never going to repossess this stuff' — unless it was a car," Buys said.
World acknowledged in its response that such repossessions are rare, but it said the collateral played a valuable role in motivating borrowers. "World believes that an important element of consumer protection is for a borrower to have an investment in the success of the transaction," the company wrote. When "borrowers have little or no investment in the success of the credit transaction they frequently find it easier to abandon the transaction than to fulfill their commitments."

'Real Gibberish'

Sutton's loan contract said her annual percentage rate, or APR, was 90 percent. It wasn't. Her effective rate was more than double that: 182 percent.
World can legally understate the true cost of credit because of loopholes in federal law that allow lenders to package nearly useless insurance products with their loans and omit their cost when calculating the annual rate.
As part of her loan, Sutton purchased credit life insurance, credit disability insurance, automobile insurance and non-recording insurance. She, like other borrowers ProPublica interviewed, cannot tell you what any of them are for: "They talk so fast when you get that loan. They go right through it, real gibberish."
The insurance products protect World, not the borrower. If Sutton were to have died, become disabled, or totaled her car, the insurer would have owed World the unpaid portion of her loan. Together, the premiums for her $200 loan total $76, more than the loan's other finance charges.
The insurance products provide a way for World to get around the rate caps in some states and effectively to charge higher rates. Sutton's stated annual percentage rate of 90 percent, for example, is close to the maximum that can legally be charged in Georgia.
ProPublica examined more than 100 of the company's loans in 10 states, all made within the last several years. A clear pattern developed: In states that allowed high rates, World simply charged high interest and other finance fees but did not bother to include insurance products. For a small loan like Sutton's, for example, World has charged a 204 percent annual rate in Missouri and 140 percent in Alabama, states that allow such high levels.
In states with more stringent caps, World slapped on the insurance products. The stated annual rate was lower, but when the insurance premiums were accounted for, the loans were often even more expensive than those in the high-rate states.
"Every new person who came in, we always hit and maximized with the insurance," said Matthew Thacker, who worked as an assistant manager at a World branch in Tifton, Ga., from 2006 to 2007. "That was money that went back to the company."
World profits from the insurance in two ways: It receives a commission from the insurer, and, since the premium is typically financed as part of the loan, World charges interest on it.
"The consumer is screwed six ways to Sunday," said Birny Birnbaum, the executive director of the nonprofit Center for Economic Justice and a former associate commissioner at the Texas Department of Insurance.
Industry data reveal just how profitable this part of World's business is. World offers the products of an insurer called Life of the South, a subsidiary of the publicly traded Fortegra Financial Corp. In Georgia in 2011, the insurer received $26 million in premiums for the sort of auto insurance Sutton purchased as part of her loan. Eighteen million dollars, or 69 percent, of that sum went right back to lenders like World. In all, remarkably little money went to pay actual insurance claims: about 5 percent.
The data, provided to ProPublica by the National Association of Insurance Commissioners, paint a similar picture when it comes to Life of the South's other products. The company's credit accident and health policies racked up $20 million in premiums in Georgia in 2011. While 56 percent went back to lenders, only 14 percent went to claims. The pattern holds in other states where World offers the products.
Fortegra declined to comment.
Gretchen Simmons, who managed a World branch in Pine Mountain, Ga., praised the company for offering customers loans they might not have been able to get elsewhere. She said she liked selling accidental death and disability insurance with loans, because many of her clients were laborers who were "more prone to getting their finger chopped off."
According to several contracts reviewed by ProPublica, losing one finger isn't enough to make a claim. If the borrower loses a hand, the policy pays a lump sum (for instance, $5,000). But, according to the policy, "loss of a hand means loss from one hand of four entire fingers."
Simmons took out a loan for herself from a World competitor — and made sure to decline the insurance. Why? "Because I knew that that premium of a hundred and blah blah blah dollars that they're charging me for it can go right into my pocket if I just deny it."
In its written response, World alleged that Simmons had been fired from the company because of "dishonesty and alleged misappropriation of funds," but it refused to provide further details. Simmons, who worked for World from 2005 to 2008, denied that she left the company on bad terms.
Federal rules prohibit the financing of credit insurance premiums as part of a mortgage but allow it for installment and other loans. Installment lenders can also legally exclude the premiums when calculating the loan's annual percentage rate, as long as the borrower can select the insurer or the insurance products are voluntary — loopholes in the Truth in Lending Act, the federal law that regulates how consumer-finance products are marketed.
World's contracts make all legally necessary disclosures. For example, while some insurance products are voluntary, World requires other types of insurance to obtain a loan. For mandatory insurance, Sutton's contract states that the borrower "may choose the person or company through which insurance is to be obtained." She, like most customers, wouldn't know where to begin to do that, even if it were possible.
"Nobody is going to sell you insurance that protects your loan, other than the lender," said Birnbaum. "You can't go down the street to your State Farm agent and get credit insurance."
When insurance products are optional — meaning the borrower can deny coverage but still get the loan — borrowers must sign a form saying they understand that. "We were told not to point that out," said Thacker, the former Tifton, Ga., assistant manager.
World, in its response to ProPublica, declined to offer any statistics on what percentage of its loans carry the insurance products, but it said employees are trained to inform borrowers that they are voluntary. As for why the company offers the insurance products in some states and not in others, World said it depends on state law and if "it makes business sense to do so."
Buys, the former Chandler, Okla., branch manager, said she found the inclusion of the insurance products particularly deceitful. In Oklahoma, World can charge high interest rates and fees on loans under $1,000 or so, so it typically doesn't include insurance on those loans. But it often adds the products to larger loans, which has the effect of jacking up the annual rate.
"You were supposed to tell the customer you could not do the loan without them purchasing all of the insurance products, and you never said 'purchase,' " Buys recalled. "You said they are 'included with the loan' and focused on how wonderful they are."
It was not long into her tenure that Buys said she began to question whether the products were really required. She asked a family friend who was an attorney if the law required it, she recalled, and he told her it didn't.
World trained its employees to think of themselves as a "financial adviser" to their clients, Buys said. She decided to take that literally.
When a customer took out a new loan, "I started telling them, 'Hey, you can have this insurance you're never going to use, or you can have the money to spend,'" she recalled. Occasionally, a customer would ask to have the disability insurance included, so she left it in. But mostly, people preferred to take the money.
One day, she remembered, she was sitting across from a couple who had come into the office to renew their loan. They were discussing how to cover the costs of a funeral, and Chandler being a small town, she knew it was their son's. On her screen were the various insurance charges from the original loan. The screen "was blinking like I could edit it," she recalled.
At that moment, she realized that she could advise customers renewing their loans that they could drop the insurance from their previous loans. If they did so, they'd receive several hundred dollars more. The couple excitedly agreed, she recalled, and other customers also thought it was good advice and dropped the products.
Buys' regional supervisor threatened to discipline her, Buys said. But it was hard to punish her for advising customers that the products were voluntary when they were. "All they could do was give me the stink eye," Buys said.
But World soon made it harder to remove the insurance premiums, Buys said. She couldn't remove them herself but instead had to submit a form, along with a letter from the customer, to World's central office. That office, she said, sometimes required borrowers to purchase the insurance in order to get the loans.
World, in its response to ProPublica's questions, said Buys' assertions about how it handled insurance were "false," but it declined to provide further details.
Eventually, Buys said, her relationship with management deteriorated to the point that she felt she had no choice but to quit. By the time she left in 2011, she had worked at World for three years.
World, in the answers provided to ProPublica, said that when Buys quit, she was "subject to being terminated for cause including dishonesty and alleged misappropriation of funds." The company declined to provide any details about the allegations, but after Buys quit, World filed suit in county court, accusing her of stealing money from the company. Buys retained an attorney and responded, maintaining her innocence and demanding proof of any theft. World withdrew the suit.

'It's All About Keeping Them'

Sutton's original loan contract required her to make seven payments of $50, at which point her loan would have been fully paid off.
But if World can persuade a customer to renew early in the loan's lifespan, the company reaps the lion's share of the loan's charges while keeping the borrower on the hook for most of what they owed to begin with. This is what makes renewing loans so profitable for World and other installment lenders.
"That was the goal, every single time they had money available, to get them to renew, because as soon as they do, you've got another month where they're just paying interest," says Kristin, the former World employee from Texas.

Katrina Sutton at her home in McDonough, Ga. She recalled that less than four months from taking out her initial installment loan, World Finance asked her to refinance. She received $44, the amount of principal she had paid back so far. (Erik S. Lesser/EPA for ProPublica)

Sure enough, less than four months after taking out the initial loan, Sutton agreed to renew.
In a basic renewal (the company calls it either a "new loan" or a "refinance"), the borrower agrees to start the loan all over again. For Sutton, that meant another seven months of $50 payments. In exchange, the borrower receives a payout. The amount is based on how much the borrower's payments to date have reduced the loan's principal.
For Sutton, that didn't amount to much. She appears to have made three payments on her loan, totaling $150. (The company's accounting is opaque, and Sutton does not have a record of her payments.) But when she renewed the loan, she received only $44.
Most of Sutton's payments had gone to cover interest, insurance premiums and other fees, not toward the principal. And when she renewed her loan a second time, it was no different.
The effect is similar to how a mortgage amortizes: The portion of each payment that goes toward interest is at its highest the first month and decreases with each payment. As the principal is reduced, less interest is owed each month. By the end of the loan, the payments go almost entirely toward paying down the principal.
World regularly sends out mailers, and its employees make frequent phone calls, all to make sure borrowers know they have funds available. Every time a borrower makes a payment, according to the company, that customer "receives a receipt reflecting, among other information, the remaining balance on the borrower's loan and, where applicable, the current new credit available for that borrower." And when a borrower visits a branch to make a payment, former employees say, employees are required to make the pitch in person.
"You have to say, 'Let me see what I can do to get you money today,'" Buys recalled. If the borrower had money available on the account, it had to be offered, she and other former employees said.
The typical pitch went like this, Kristin said: "'Oh, by the way, you've got $100 available, would you like to take that now or do you want to wait till next month?'"
Customers would ask, "'Well, what does this mean?'" Buys said. "And you say, 'Oh, you're just starting your loan over, you know, your payments will be the same.'"
The company often encourages customers to renew the loans by saying it will help them repair their credit scores, former employees said, since World reports to the three leading credit bureaus. Successively renewing loans also makes customers eligible for larger loans from World itself. After renewing her loan twice, for instance, Sutton received an extra $40.
"We were taught to make [customers] think it was beneficial to them," Buys said.
"Retail (i.e., consumer) lending is not significantly unlike other retail operations and, like those other forms of retail, World does market its services," the company wrote in its response to questions.
About three-quarters of the company's loans are renewals, according to World's public filings. Customers often renew their loans after only two payments, according to former employees.
The company declined to say how many of its renewals occur after two payments or how many times the average borrower renews a loan. Renewals are only granted to borrowers who can be expected to repay the new loan, it said.
Lawsuits against other major installment lenders suggest these practices are common in the industry. A 2010 lawsuit in Texas claimed that Security Finance, a lender with about 900 locations in the United States, induced a borrower to renew her loan 16 times over a three-year period. The suit was settled. In 2004, an Oklahoma jury awarded a mentally disabled Security Finance borrower $1.8 million; he had renewed two loans a total of 37 times. After the company successfully appealed the amount of damages, the case was settled. Security Finance declined to respond to questions about the suits.
Another 2010 suit against Sun Loan, a lender with more than 270 office locations, claims the company convinced a husband and wife to renew their loans more than two dozen times each over a five-year period. Cary Barton, an attorney representing the company in the suit, said renewals occur at the customer's request, often because he or she doesn't have enough money to make the monthly payment on the previous loan.
The predominance of renewals means that for many of World's customers, the annual percentage rates on the loan contracts don't remotely capture the real costs. If a borrower takes out a 12-month loan for $700 at an 89 percent annual rate, for example, but repeatedly renews the loan after four payments of $90, he would receive a payout of $155 with each renewal. In effect, he is borrowing $155 over and over again. And for each of those loans, the effective annual rate isn't 89 percent. It's 537 percent.
World called this calculation "completely erroneous," largely because it fails to account for the money the customer received from the original transaction. World's calculation of the annual percentage rate if a borrower followed this pattern of renewals for three years: about 110 percent.

A Decade of Debt

In every World office, employees say, there were loan files that had grown inches thick after dozens of renewals.
At not just one but two World branches, Emma Johnson of Kennesaw, Ga., was that customer. Her case demonstrates how immensely profitable borrowers like her are for the company — and how the renewal strategy can transform long-term, lower-rate loans into short-term loans with the triple-digit annual rates of World's payday competitors.
Since being laid off from her janitorial job in 2004, Johnson, 71, has lived primarily on Social Security. Last year, that amounted to $1,139 in income per month, plus a housing voucher and food stamps.
Johnson could not remember when she first obtained a loan from World. Nor could she remember why she needed either of the loans. She can tell you, however, the names of the branch managers (Charles, Brittany, Robin) who've come and gone over the years, her loans still on the books.
Johnson took out her first loan from World in 1993, the company said. Since that time, she has taken out 48 loans, counting both new loans and refinancings, from one branch. In 2001, she took out a loan from the second branch and began a similar string of renewals.
When Johnson finally declared bankruptcy early this year, her two outstanding loans had face values of $3,510 and $2,970. She had renewed each loan at least 20 times, according to her credit reports. Over the last 10 years, she had made at least $21,000 in payments toward those two loans, and likely several thousand dollars more, according to a ProPublica analysis based on her credit reports and loan documents.
Although the stated length of each loan was about two years, Johnson would renew each loan, on average, about every five months. The reasons varied, she said. "Sometimes stuff would just pop out of the blue," she said. This or that needed a repair, one of her children would need money.
Sometimes, it was just too enticing to get that extra few hundred dollars, she acknowledged. "In a sense, I think I was addicted."
It typically took only a few minutes to renew the loan, she said. The contract contained pages of disclosures and fine print, and the World employee would flip through, telling her to sign here, here and here, she recalled.
Her loan contracts from recent years show that the payouts were small, often around $200. That wasn't much more than the $115 to $135 Johnson was paying each month on each loan. The contracts had stated APRs ranging from about 23 percent to 46 percent.
But in reality, because Johnson's payments were largely going to interest and other fees, she was taking out small loans with annual rates typically in the triple digits, ranging to more than 800 percent. World also disputed this calculation.
As she continued to pay, World would sometimes increase her balance, providing her a larger payout, but her monthly payment grew as well. It got harder and harder to make it from one Social Security check to the next. In 2010, she took out another loan, this one from an auto-title lender unconnected to World.
Eventually, she gave up on juggling the three loans. By the end of each month, she was out of money. If she had to decide between basic necessities like gas and food and paying the loans, the choice, she finally realized, was easy.

'Chasing' Customers

At World, a normal month begins with about 30 percent of customers late on their payments, former employees recalled. Some customers were habitually late because they relied on Social Security or pension checks that came later in the month. They might get hit with a late fee of $10 to $20, but they were otherwise reliable. Others required active attention.
Phone calls are the first resort, and they begin immediately — sometimes even before the payment is due for customers who were frequently delinquent. When repeated calls to the home or cell phone, often several times a day, don't produce a payment, World's employees start calling the borrower at work. Next come calls to friends and family, or whomever the borrower put down as the seven "references" required as part of the loan application.
"We called the references on a daily basis to the point where they got sick of us," said Simmons, who managed the Pine Mountain, Ga., store.
If the phone calls don't work, the next step is to visit the customer at home: "chasing," in the company lingo. "If somebody hung up on us, we would go chase their house," said Kristin from Texas.
The experience can be intimidating for customers, especially when coupled with threats to seize their possessions, but the former employees said they dreaded it, too. "That was the scariest part," recalled Thacker, a former Marine, who as part of his job at World often found himself driving, in the evening, deep into the Georgia countryside to knock on a borrower's door. He was threatened a number of times, he said, once with a baseball bat.
Visits to the borrower's workplace are also common. The visits and calls at work often continue even after borrowers ask the company to stop, according to complaints from World customers to the Federal Trade Commission. Some borrowers complained the company's harassment risked getting them fired.
ProPublica obtained the FTC complaints for World and several other installment loan companies through a Freedom of Information Act request. They show consistent tactics across the industry: the repeated phone calls, the personal visits.
After she stopped paying, Johnson remembered, World employees called her two to three times a day. One employee threatened to "get some stuff at your house," she said, but she wasn't cowed. "I said, 'You guys can get this stuff if you want it.'" In addition, a World employee knocked on her door at least three times, she said.
The goal of the calls and visits, former employees said, is only partly to prod the customer to make a payment. Frequently, it's also to persuade them to renew the loan.
"That's [World's] favorite phrase: 'Pay and renew, pay and renew, pay and renew,'" Simmons said. "It was drilled into us."
It's a tempting offer: Instead of just scrambling for the money to make that month's payment, the borrower gets some money back. And the renewal pushes the loan's next due date 30 days into the future, buying time.
But the payouts for these renewals are often small, sometimes minuscule. In two of the contracts ProPublica examined, the customer agreed to start the loan all over again in exchange for no money at all. At other times, payouts were as low as $1, even when, as in one instance, the new loan's balance was more than $3,000.

Garnishing Wages

For Sutton, making her monthly payments was always a struggle. She remembered that when she called World to let them know she was going to be late with a payment, they insisted that she come in and renew the loan instead.
As a result, seven months after getting the original $207 loan from World, Sutton wasn't making her final payment. Instead, she was renewing the loan for the second time. Altogether, she had borrowed $336, made $300 in payments, and now owed another $390. She was going backward.

A summons of garnishment Katrina Sutton received. When World Finance discovered that it could not garnish Sutton’s wages, the company put a hold on her “payroll card,” a kind of debit card provided by her employer. She was left without any money to pay for the gas she needed to get to work. (Erik S. Lesser/EPA for ProPublica)

Not long after that second renewal, Sutton said, Walmart reduced her hours, and there simply wasn't enough money to go around. "I called them at the time to say I didn't have money to pay them," she said. World told her she had to pay.
The phone calls and home visits followed. A World employee visited the Walmart store where she worked three times, she recalled.
World didn't dispute that its employees came to Sutton's workplace, but it said that attempts to contact "any borrower at her place of employment would occur only after attempts to contact the borrower at her residence had failed."
In Georgia, World had another path to force Sutton to pay: suing her.
World files thousands of such suits each year in Georgia and other states, according to a review of court filings, but the company declined to provide precise figures.
Because Sutton had a job, she was a prime target for a suit. Social Security income is off limits, but with a court judgment, a creditor can garnish up to 25 percent of a debtor's wages in Georgia.
"When we got to sue somebody, [World] saw that as the jackpot," Buys said. In her Oklahoma store, collecting the junk people had pledged as collateral was considered useless. Garnishment was a more reliable way for the company to get its money, and any legal fees were the borrower's problem.
World said 11 of the states where it operates permit lenders to "garnish customers' wages for repayment of loans, but the Company does not otherwise generally resort to litigation for collection purposes, and rarely attempts to foreclose on collateral."
The sheriff served Sutton with a summons at Walmart, in front of her co-workers. Sutton responded with a written note to the court, saying she would pay but could only afford $20 per month. A court date was set, and when she appeared, she was greeted by the branch manager who had given her the original loan. The manager demanded Sutton pay $25 every two weeks. She agreed.
For five months, Sutton kept up the payments. Then, because of taxes she had failed to pay years earlier, she said, the IRS seized a portion of her paycheck. Again, she stopped paying World. In response, the company filed to garnish her wages, but World received nothing: Sutton was earning too little for the company to legally get a slice of her pay. After two months, World took another step.
Sutton's wages are paid via a "payroll card," a kind of debit card provided by Walmart. World filed to seize from Sutton's card the $450 it claimed she owed. By that point, she'd made more than $600 in payments to the company.
The immediate result of the action was to freeze Sutton's account, her only source of income. She couldn't gas up her car. As a result, she couldn't drive to work.
Sutton said she called a number for World's corporate office in a panic. "I said, 'You're gonna leave me with no money to live on?'" The World employee said the company had had no choice because Sutton didn't hold up her end of their agreement, Sutton recalled, and then the employee made an offer: If Sutton's available wages in her account hadn't covered her total debt to World after 30 days, the company would unfreeze her account and allow her to start a new payment plan.
Desperate, she gave up trying to deal with the company on her own and went to Georgia Legal Services Program, a nonprofit that represents low-income clients across the state.
"Her case is terribly egregious," said Michael Tafelski, a lawyer with GLSP who specializes in collections cases and represented Sutton. World had overstated the amount Sutton legally owed, he said, and circumvented laws limiting the amount of funds creditors can seize. In effect, the company was garnishing 100 percent of her wages. It's "unlike anything I have ever seen," Tafelski said, "and I have seen a lot of shady collectors."
After Tafelski threatened to sue World, the company beat a quick retreat. It dismissed all open cases against Sutton and declared her obligation satisfied.
In its response to ProPublica, World claimed that Tafelski had bullied the billion-dollar company: "Mr. Tafelski used abusive out of court threats to accomplish an end he knew he could not obtain through legal process."
"It's common practice among lawyers to contact the opposing party to attempt to resolve problems quickly, without filing a lawsuit, especially in emergency cases like this one," Tafelski said.
As for Sutton, she had missed several days of work, but her account was unfrozen, and she was done with World Finance forever.
"If I'd known then what I know now," she said, "I'd never have fooled with them."

From our partners at Marketplace:

Listen to ProPublica's Paul Kiel and Marketplace's Mitchell Hartman discuss their reporting on installment loans:

Medicare Drug Program Fails to Monitor Prescribers, Putting Seniors and Disabled at Risk

Dr. Daniel J. Hurley talks to patient William Sanders at his outpatient clinic in Beech Grove, Indiana. Hurley was credited with writing more than 160,000 prescriptions in Medicare Part D in 2010, the most of any provider in the country. Hurley said prescriptions by others in his practice were credited to him by nursing home pharmacies, but that Medicare has never asked him about his numbers. “Why wouldn’t they call us up and ask us?” he said. (Photo by Matt McClain/ The Washington Post)

by Tracy Weber, Charles Ornstein and Jennifer LaFleur
ProPublica, May 11, 2013, 9:06 p.m.

Ten years ago, a sharply divided Congress decided to pour billions of dollars into subsidizing the purchase of drugs by elderly and disabled Americans.

The initiative, the biggest expansion of Medicare since its creation in 1965, proved wildly popular. It now serves more than 35 million people, delivering critical medicines to patients who might otherwise be unable to afford them. Its price tag is far lower than expected.

But an investigation by ProPublica has found the program, in its drive to get drugs into patients' hands, has failed to properly monitor safety. An analysis of four years of Medicare prescription records shows that some doctors and other health professionals across the country prescribe large quantities of drugs that are potentially harmful, disorienting or addictive. Federal officials have done little to detect or deter these hazardous prescribing patterns.

Searches through hundreds of millions of records turned up physicians such as the Miami psychiatrist who has given hundreds of elderly dementia patients the same antipsychotic, despite the government's most serious "black box" warning that it increases the risk of death. He believes he has no other options.

Some doctors are using drugs in unapproved ways that may be unsafe or ineffective, records showed. An Oklahoma psychiatrist regularly prescribes the Alzheimer's drug Namenda for autism patients as young as 12; he says he thinks it calms them. Autism experts said there is scant scientific support for this practice.

The data analysis showed widespread prescribing of drugs such as carisoprodol, which was pulled from the European market in 2007. In 2010 alone, health-care professionals wrote more than 500,000 prescriptions for the drug to patients 65 and older. The muscle relaxant, also known as Soma, is on the American Geriatrics Society's list of drugs seniors should avoid.

The data, obtained under the Freedom of Information Act, makes public for the first time the prescribing practices and identities of doctors and other health-care providers. The information does not include patient names or the reasons why doctors prescribed particular drugs, so reporters interviewed the physicians to learn their rationales.

Prescribers: What Do You Think About Medicare Part D?

Share Your Insights

Medicare has access to reams of data about its patients, their diagnoses and the medical services they received. It could analyze all of this information to determine whether patients are being prescribed appropriate drugs for their conditions.
But officials at the Centers for Medicare and Medicaid Services say the job of monitoring prescribing falls to the private health plans that administer the program, not the government. Congress never intended for CMS to second-guess doctors - and didn't give it that authority, officials said.
"CMS's payments don't go to physicians, don't go to pharmacies. They go to plans, which is how our oversight framework has been established," Jonathan Blum, the agency's director of Medicare, said in an interview. The philosophy "really has been to defer to physicians" about whether a drug is medically necessary, he said.
Asked repeatedly to cite which provision in the law limits their oversight of prescribers, CMS officials could not do so.

The Office of the Inspector General of the Department of Health and Human Services has repeatedly criticized CMS for its failure to police the program, known as Part D. In report after report, the inspector general has advised CMS officials to be more vigilant. Yet the agency has rejected several key recommendations as unnecessary or overreaching.
Other experts in prescription drug monitoring also said Medicare should use its data to identify troubling prescribing patterns and take steps to investigate or restrict unsafe practitioners. That's what state Medicaid programs for the poor routinely do.

"For Medicare to just turn a blind eye and refuse to look at data in front of them . . . it's just beyond comprehension," said John Eadie, director of the Prescription Drug Monitoring Program Center of Excellence at Brandeis University.

"They're putting their patients at risk."
Although Medicare hands responsibility to private insurers, experts say they are ill-equipped for the task. Insurers have access solely to the prescriptions for their members - not to a provider's prescriptions across multiple health plans.

Only Medicare can see that.

"A red flag can turn out to be nothing, or it can turn out to be something really, really horrible," said Kathryn Locatell, a California physician who specializes in geriatrics and elder abuse. "You won't know unless you flag it."

In lawsuits and disciplinary records, state and federal authorities cite a number of reasons that doctors prescribe improperly. Some run mills where patients get prescriptions if they pay cash for a visit. Others have relationships with drug companies that influence what they prescribe. Regulators say some doctors choose inappropriate medications under pressure from families or facilities.

Research also shows that doctors often don't keep up with the latest studies and drug warnings.

ProPublica's examination of Part D data from 2007 through 2010 showed that, in many cases, Medicare failed to act against providers who have been suspended or disciplined by other regulatory authorities.
Doctors barred by state Medicaid programs for questionable prescribing remain able to dole out the same drugs under Medicare. So can dozens of practitioners who have been criminally charged or convicted for problem prescribing, or who have been disciplined by state medical boards.

The Part D records detail 1.1 billion claims in 2010 alone, including prescriptions and refills dispensed. ProPublica has created an online tool, Prescriber Checkup, to allow anyone to search for individual providers and see which drugs they prescribe.

Is Your Doctor in Prescriber Checkup?

Share Your Thoughts

About 70 providers each churned out more than 50,000 prescriptions and refills in 2010, the data show, averaging at least 137 a day.
A few had high tallies because they work in institutional settings, such as nursing homes, or operate busy clinics. In other cases, doctors said they think the prescriptions of their colleagues were attributed to them. They acknowledged in interviews that their numbers should have sparked questions.

Some families say they, too, think Medicare should be paying closer attention.

When 79-year-old Mable "Nanny" Webb's family put her in a nursing home near Fort Worth in 2004 to rehabilitate her back, she came under the care of Adolphus Ray Lewis, who would later become one of Medicare's busiest prescribers.

Records show that the Texas medical board temporarily restricted Lewis's license in 1998 for improper prescribing of painkillers and that he was sued repeatedly for malpractice. But Webb's family didn't know that.
While under Lewis's supervision, Webb developed a urinary tract infection that went untreated and was given a painkiller in doses that were excessive and dangerous for her condition, court testimony shows. Within a month, she died.

Webb's relatives sued. During the 2008 trial, Lewis admitted responsibility for her death, testifying that he had not reduced the dosage ordered by a nurse he supervised.

A jury ordered Lewis to pay $1.6 million in damages to Webb's relatives. They later settled for a lesser amount - one of at least eight malpractice settlements in cases involving Lewis since the mid-1990s, according to court records and interviews
.
Yet Lewis continued to prescribe, racking up nearly 99,000 Medicare prescription claims including refills in 2010, fifth-most in the country. He wrote 46,000 more under Medicaid that same year. He declined to comment for this article.

Webb's granddaughter, Michelle Wheeler, said that though it's too late for her family, information about a doctor's drug choices could help others decide who should care for their loved ones.

"Everybody should be able to know that," she said.

Antipsychotics for Seniors

In his worn Miami office, psychiatrist Enrique Casuso said he has no choice but to give antipsychotics to many of his elderly patients.
Often, they are beset with dementia and have been abandoned by their families in understaffed assisted-living facilities. They may dress for work and wait in the street for a bus, he said, when they haven't had a job in a decade.

Drugs keep them safe and ease their anxiety, Casuso said: "You have to submerge them in medication to avoid a catastrophic event."
But Casuso, 74, prescribes powerful antipsychotics at a rate that other providers and experts call alarming. In 2010, he prescribed more of these medicines to seniors in Medicare than any other physician in the country - 50 percent more than the second-ranking doctor. Three-quarters of the prescriptions were for a single brand, Seroquel, which Casuso said is "less evil" and has less-severe side effects than other antipsychotics.
Although antipsychotics are an important treatment for patients with serious mental illness, such as schizophrenia, the Food and Drug Administration warns against their use in dementia patients, citing increased risk of death. Regulators are trying to discourage their use in nursing homes.

Casuso also leads the nation in giving seniors powerful sedatives, such as zolpidem, the generic form of Ambien, despite warnings from geriatric experts that the drugs do little to help the elderly sleep and that the medications increase the risk of confusion, falls and bone fractures. Casuso said the pills allow his agitated patients to sleep.
Casuso's prescribing patterns have not triggered any intervention from Medicare.

In his office, Casuso sits surrounded by mementos of his native Cuba, where he served 16 years in prison for his role in the Bay of Pigs invasion. "I know what it is to be locked in one place," he said.
He flipped through a stack of letters from Part D insurers about his patients. Some have alerted him to the government warnings about risks on a drug's label.

"They say this medication has a black-box warning on the elderly," said Casuso, raising his hands in a gesture of surrender. "I know! I don't like that. What am I going to use?"

Still, none of the letters forbids him from using the drugs. Casuso has continued prescribing the same drugs, and Part D has continued to pay for them.

Medicare records show a long list of doctors who routinely prescribe antipsychotics to older patients. In 2010, nearly 340 physicians and other providers accounted for more than 1,000 antipsychotic prescriptions each for patients 65 and older.

CMS's Blum said his agency deserves credit for trying to reduce antipsychotic use in nursing homes. But when asked whether the agency was likewise focusing on the doctors who prescribe risky drugs, he said, "Not at this time."

The agency declined to comment on Casuso or any of the other physicians named in this article.

Florida's Medicaid program has not been nearly as accepting of Casuso's practices as Medicare, public records show.

In 2005, the state kicked him out of its Medicaid network using a provision that allows it to end a contract without cause on 30 days' notice. An internal memo justifying his removal said Casuso was seeing up to 81 Medicaid patients a day in addition to non-Medicaid cases. Investigators found cases in which he lacked "awareness or oversight of the medication prescribed," according to the memo, obtained under a public records request.

Casuso said he believes Medicaid terminated him because he prescribed a lot of expensive drugs, not because he endangered patients. He suggested that his prescribing numbers are high because some insurers require two prescriptions if patients need a different-strength pill in the morning than at night.

Locatell, the geriatrics expert, said Medicare should be doing more to protect patients whose conditions render them unable to question their own care.

"They can't watch out for themselves, that's for sure," she said.

'Like Tying Both Hands'

Congress created Medicare's drug program in 2003 after a contentious, middle-of-the-night vote marked by aggressive arm-twisting and called-in favors.

Republicans, led by President George W. Bush, pushed through more spending to lower seniors' drug costs. Most Democrats called the plan a blank check for drugmakers because it prohibited Medicare from negotiating with the companies for lower prices.
Typically in Medicare, the government is responsible for contracting with doctors, reviewing claims for treatment and paying the bills.
But Part D is different: Patients get their drugs through stand-alone drug plans, which cover only drugs, or through Medicare HMOs that also cover medical services.

Medicare pays private insurers a set amount per enrollee to run the program and pay for the drugs. All the insurance plans are supposed to alert pharmacies to potentially harmful drug interactions, query doctors who prescribe high levels of narcotics to individual patients and be on the lookout for fraud, among other things.

Medicare also expects the insurers to prevent inappropriate prescribing for individual patients. But it doesn't give them enough information or the tools to do that.

With rare exceptions, Medicare does not allow insurers to reject drug claims. It also does not give the stand-alone plans access to their members' medical claims, making it nearly impossible for them to discern if patients have been given the wrong drug for their conditions.
Insurers say they must pay for prescriptions from all providers - even those they believe are acting improperly - unless they have been formally excluded from the program. They are asked to refer questionable cases to Medicare's fraud contractor.

"It's like tying both hands behind someone's back," said Jerry Avorn, a Harvard medical professor and author of a book on the risks and benefits of prescription drugs.

From the start, Avorn and other experts were concerned that Congress was making a mistake by segregating patients' drug coverage from the rest of their care. But Congress, under heavy lobbying by the drug industry, opted for a payment pipeline for drugs, not another layer of bureaucracy.

The priority for CMS was to get seniors their drugs.
"They just did not want to be accused of letting the Part D plans interfere with a physician's medical judgment," said Thomas Barker, who was CMS's top lawyer when the program's rules were crafted.
Told of ProPublica's findings, Barker said it might be time to revisit how the program is run.

"We did what we thought would be in the best interest of beneficiaries," he said. "We had no idea what was going to happen."

Alarms Sounded

Some of Medicare's most controversial providers have been in the headlines, but it hasn't hindered their ability to prescribe drugs in Part D.
Chicago psychiatrist Michael Reinstein, who works at a string of nursing homes for the mentally ill, was the subject of articles published jointly by ProPublica and the Chicago Tribune in 2009 for giving more of the potent schizophrenia drug clozapine to Medicaid patients than all of the physicians in Texas.

Clozapine is the only drug approved for treatment-resistant schizophrenia, but it carries a risk of serious side effects, including seizures, diabetes and the potential for a dangerous decrease in the number of white blood cells.

Reinstein, 69, has been sued more than a dozen times since 2005 for malpractice involving patients who died. Neither he nor his attorney responded to multiple requests for comment.
Records show that Reinstein's most-prescribed drugs in Medicare were the same as those in Medicaid.

From 2007 to 2009, he wrote an average of 20,000 Medicare prescriptions annually for clozapine and a brand-name version, FazaClo, with most going to disabled patients younger than 65. Although he wrote fewer prescriptions in 2010 - 14,000 - the number was still more than double the next-highest prescriber of these drugs.
Reinstein was the Part D program's top prescriber of antipsychotics to seniors and the disabled over the four-year period analyzed by ProPublica.
Last November, the Justice Department filed suit against Reinstein, alleging that he prescribed certain medicines in exchange for speaking or consulting payments from their makers, Novartis, Teva Pharmaceuticals and Ivax Pharmaceuticals, which Teva acquired in 2006. The suit also accused him of submitting false claims to Medicare and Medicaid.
The next day, the state medical board filed a complaint against Reinstein, and Illinois Medicaid suspended payments to him. But he remains able to prescribe in Medicare.

That same month, Reinstein defended his prescribing to the Chicago Tribune, saying his use of clozapine was "the best choice" for his severely mentally ill patients. "I am confident that I will be vindicated," he said.
Chicago psychiatrist Mark Amdur, who complained about Reinstein to Illinois officials in 2003, said Medicare and Medicaid officials share in the blame for leaving Reinstein's patients at risk.

"They know what people are prescribing, or they should know," he said.
Miami psychiatrist Fernando Mendez-Villamil's prescribing habits came to light in a 2009 letter from Sen. Charles E. Grassley (R-Iowa) to HHS Secretary Kathleen Sebelius.

In Florida Medicaid alone, Mendez-Villamil had written more than 96,000 prescriptions for mental-health drugs from July 2007 to March 2009, more than anyone else in the program, Grassley noted. He asked Sebelius what her department had done about him, and what it does to track the prescribing of others.
Months later, in April 2010, Florida Medicaid expelled Mendez-Villamil without publicly revealing its reasons. An internal memo cited concerns about "the volume of patients being seen, and the medications being prescribed."

Earlier this year, the Florida medical board accused him of giving patients as young as 3 a variety of mental health drugs without properly diagnosing or monitoring them.

Yet throughout, Mendez-Villamil has remained in good standing with Medicare. Working primarily out of his walk-in clinic, he wrote 6,100 prescriptions for antipsychotics in 2009 and 5,500 more in 2010, records show.
Mendez-Villamil could not be reached for comment, but his attorney, Mike Gennett, denied that his client mistreated patients. "We categorically deny any wrongdoing by Dr. Mendez-Villamil in regards to his care of patients or prescribing of medications," he wrote in an email. Mendez-Villamil has requested a formal hearing on the medical board complaint.
Sebelius responded to Grassley's inquiry in March 2010, assuring the senator that Mendez-Villamil was under investigation by Medicare's fraud contractor.

More than three years later, there has been no public action.
CMS did not respond to questions about Mendez-Villamil, saying it could not discuss ongoing administrative or criminal investigations.

In an interview for this article, Grassley said it is "kind of ridiculous" for Medicare and Medicaid to take such different actions.
"What I expect here is a little common sense on the part of CMS," he said.

Rx for Narcotics

Medicare does little to stop some doctors with criminal or disciplinary histories from continuing to prescribe to patients.
Perhaps the most striking example: its inaction on prolific prescribers of OxyContin and oxycodone, two often-abused narcotics with a high street value.

Half of Medicare's top 20 prescribers of OxyContin in 2010 have been criminally charged, convicted or settled fraud claims, or have been disciplined by their state medical boards, records show.

Similarly, eight of the top 20 prescribers of 30-milligram oxycodone pills - the strongest dose - have been charged, convicted or barred from prescribing controlled substances, or face discipline by licensing boards.
Yet as of today, only one of those doctors has been barred from Medicare - and that wasn't until nearly a year after his conviction for drug trafficking and health-care fraud.

Medicare shares responsibility with the HHS inspector general for allowing the doctors to remain in the program. Medicare has not sought authority from Congress to suspend providers from Part D - as experts say it should. The inspector general, which is responsible for excluding providers, hasn't done so in these cases.
Criminal charges alone are not enough to bar a practitioner, said Don White, a spokesman for the inspector general. The office must exclude providers convicted of certain offenses, including fraud, and has discretion to do so if they have lost licenses. But White said his office relies on other agencies to flag these cases.
"The legal process is sure but not fast," he said.
Blum said CMS is now taking steps to search for doctors and patients who may be engaged in fraud involving painkillers. The agency has encouraged insurance plans to send warning letters to doctors if signs indicate a patient may be going to different doctors to feed a drug habit.
Former CMS administrator Mark McClellan said Medicare should at least be able to stop paying for prescriptions written by doctors facing fraud charges.

"That's the kind of thing that seems like you ought to be able to find a way to deal with," he said.

In some cases, after years of inaction by Medicare and others, high prescribers were accused of harming patients.

Gerson Sternstein, 61, a Connecticut psychiatrist, consistently ranked among Medicare's most prolific OxyContin prescribers from 2007 to 2010. (OxyContin was reformulated in late 2010 to make it less prone to abuse.)
Since 2009, at least five malpractice lawsuits have been filed in Connecticut accusing him of questionable prescribing. A state medical board investigation found that his count of painkillers and other controlled substances - for the 12 months beginning July 2008 - exceeded that of Yale-New Haven Hospital.

In revoking Sternstein's license in 2011, the board cited 10 cases in which he had given out painkillers inappropriately, including two in which patients died - one from opiate toxicity, the other from a heart condition that can be associated with drug overdose.

In an e-mail, Sternstein said he was a specialist in treating patients whose pain could not be managed by anyone else. "I considered it my responsibility to try and help these individuals in their suffering," he said, noting that he faced no criminal action.

In defending himself to the medical board, documents show, one of the doctor's arguments was that Medicare allowed him to prescribe as he chose.
"Dr. Sternstein believes Medicare [Part] D allows wide latitude in off label use of medications," the board report states.

Potential for Fraud

Since Part D was launched, the HHS inspector general and the Government Accountability Office have grown increasingly worried that it lacks adequate oversight.

Several reports have found that Part D is vulnerable to fraud. Insurers have paid for prescriptions from doctors who were barred by Medicare. Separately, in 2007 alone, the program covered $1.2 billion worth of drugs prescribed by providers whose identities were unknown to insurers or Medicare, according to a June 2010 report.
The inspector general even found fault with the contractors Medicare hired to dig out fraud: The contractors genera
ted few of their own investigations, relying on outside complaints for direction.

Although many reports focus on fraud, analysts also have found that the program was vulnerable to inappropriate prescribing that put patients' lives in danger.

A May 2011 report said Medicare has not ensured that Part D paid only for drugs prescribed for FDA-approved and widely accepted off-label indications as federal law requires. About half of the 1.4 million antipsychotic prescriptions made to nursing home patients in the first six months of 2007 "were not used for medically accepted indications," the report said.

"There's certainly room for improvement," Robert Vito, a regional inspector general who has directed many of the reports, said in an interview.

Medicare should, for example, require that prescriptions include a patient's diagnosis as a way to monitor how Part D drugs were being used, his agency said.

But Medicare officials told the inspector general that neither state boards of pharmacy nor private industry requires this practice, so neither would they.

CMS also has rejected proposals to require insurers to report suspicious prescribing to its fraud contractor. Such sharing is now voluntary.
Medicare's safeguards lag well behind those of many state Medicaid programs.

Louisiana requires that doctors include diagnosis codes when they write prescriptions for painkillers and antipsychotics. Similar checks have proved effective in other states. Florida found that antipsychotics given to children younger than 6 dropped when specialists reviewed prescriptions.
Even some of Medicare's top prescribers think the program should do more to research unusual or suspicious prescribing patterns.
Indiana physician Daniel J. Hurley led the country with more than 160,000 prescriptions under Part D in 2010, ProPublica's analysis shows. In an interview, he said nursing home pharmacies had credited him with prescriptions by other health professionals in his practice, a quirk Medicare should want to address.

It's unclear how often this might happen, and some nursing home doctors do write lots of prescriptions on their own. Medicare said it recently addressed this issue, but according to Medicare's own numbers, Hurley's prescriptions have dropped only slightly.

"Why wouldn't they call us up and ask us?" Hurley said. "If you hustled, you couldn't come anywhere near that number, nor should you."

Off-label Treatment

Several times a week, psychiatrist Robert O. Morton loads his car with plastic bins of medical records and drives to facilities across Oklahoma to care for older children and adults with autism and developmental disabilities.
At many of the stops, Morton does something unorthodox: He prescribes patients Namenda, a drug normally given to elderly Alzheimer's patients.
"In autism, you'll know that when they get overstimulated, they start rocking and they start flapping," he said. "What we've seen Namenda do is just tone that down."
Morton stands out in Medicare's data because two-thirds of his prescriptions for Alzheimer's drugs were written for patients younger than 65 - a greater proportion than any other physician in the country.
Morton's prescribing of Namenda does not appear to meet Medicare payment rules, which say drugs can be covered for off-label uses only if they are supported by science and included in one of three recognized drug reference guides.
Medicare also hasn't imposed a requirement similar to Oklahoma Medicaid, which requires that Morton and other doctors get permission to give Namenda to patients 50 and younger who do not have Alzheimer's.
Several experts in autism and developmental disabilities said there is little support for the efficacy of Namenda as a treatment for autism. No studies have been done on the effects of long-term use of Namenda in children, they said.
Fred Volkmar, director of the Child Study Center at the Yale School of Medicine, said he has never prescribed the drug and would be "dubious about the rationale."
Alexander Capron, a law professor and medical ethicist at the University of Southern California, said testing new treatments is part of scientific innovation. "But when one moves beyond a single patient or maybe a couple of patients," he said, " . . . you're basically saying, 'I'm doing a study.' "
In a clinical study, patients or their families would be informed about side effects and risks.
Morton, 66, said that Namenda calms the behavioral symptoms of developmental disabilities by lessening the effects of a neurotransmitter in the brain called glutamate. Asked if he has written up his findings in a research paper, he said he hasn't had time.
Psychiatry has offered Morton a second chance in medicine. His license was revoked twice in the 1990s when he battled an opiate addiction as an internist. "I lost my wife, lost my practice, lost my job, so I had to think about what I really wanted to do," he said.
He now is the medical director at an Ada, Okla., psychiatric hospital and sees patients in a variety of other settings.
At Oakridge Home in Wewoka, Okla., one of the facilities Morton visits, nursing director Lisa Brown said Namenda has "worked wonders for mood behaviors" in developmentally disabled patients.
But even Morton conceded that his practice should have drawn Medicare's scrutiny.

"If they see a pattern that's unusual," he said, "they should go look at it."

 By Andrew Gavin Marshall

Large Corporations Seek U.S.–European 'Free Trade Agreement' to Further Global Dominance

The Transatlantic Trade and Investment Partnership is the latest plan of conglomerates to strengthen their grip over the planet.

Photo Credit: Shutterstock.com/Nightman1965

May 10, 2013  |  

 

 

A corporate world order is emerging, and like any parasite, it is slowly killing off its host. Unfortunately, the "host" happens to be the planet, and all life upon and within it. So, while the extinction of the species will be the end result of passively accepting a corporate-driven world, on the other hand, it’s very profitable for those corporations and their shareholders.

The Transatlantic Trade and Investment Partnership (TTIP) is the latest corporate-driven agenda in what is commonly called a “free trade agreement,” but which really amounts to  ‘cosmopolitical corporate consolidation’: large corporations dictating and directing the policies of states – both nationally and internationally – into constructing structures which facilitate regional and global consolidation of financial, economic, and political power into the hands of relatively few large corporations.

Such agreements have little to do with actual ‘trade,’ and everything to do with expanding the rights and powers of large corporations. Corporations have become powerful economic and political entities – competing in size and wealth with the world’s largest national economies – and thus have taken on a distinctly ‘cosmopolitical’ nature. Acting through industry associations, lobby groups, think tanks and foundations, cosmopolitical corporations are engineering large projects aimed at transnational economic and political consolidation of power... into their hands. With the construction of “a European-American free-trade zone” as “an ambitious project,” we are witnessing the advancement of a new and unprecedented global project of transatlantic corporate colonization.

The Atlantic Fortress as “Grand Strategy”

In a 2006 article for Der Spiegel, Gabor Steingart suggested that, “to combat the rise of China and Asia,” the “role NATO played in an age of military threat could be played by a trans-Atlantic free-trade zone in today’s age of economic confrontation.” With the possible “addition of Canada,” the US and EU “could stem the dwindling of Western market power by joining forces... [which] would inevitably lead to a convergence of the two economic systems.” In a process that would likely take decades, “a mega-merger of markets” would send a “new message” to the East, to “serve as a fortress.”

During the worst of the initial financial and economic crisis in January of 2009, Henry Kissinger wrote an article for the New York Times in which he noted that America’s “prescription for a world financial order has generally been unchallenged,” though the crisis had changed this, as “disillusionment” became “widespread.” Nations now wanted to protect themselves from the global markets and thus, become more independent. Kissinger warned against this, proclaiming: “An international order will emerge if a system of compatible priorities comes into being. It will fragment disastrously if the various priorities cannot be reconciled... The alternative to a new international order is chaos.”

Kissinger noted that the economic world was “globalized,” yet the political world was not, and in the midst of “political crises around the world” accelerated by “instantaneous communication,” the political and economic systems had to become “harmonized in only one of two ways: by creating an international political regulatory system with the same reach as that of the economic world; or by shrinking the economic units to a size manageable by existing political structures, which is likely to lead to a new mercantilism, perhaps of regional units.” President Obama’s election victory was an “opportunity” in “shaping a new world order.” But that opportunity had to become “a policy” as manifested through “a grand strategy.” A central facet to that grand strategy would include the strengthening of the “Atlantic partnership,” which “will depend much more on common policies.”

Some four years later, former U.S. National Security Advisor Zbigniew Brzezinski praised the “enormous promise” in the new transatlantic agreement, “It can shape a new balance between the Pacific and the Atlantic oceanic regions, while at the same time generating in the West a new vitality, more security and greater cohesion.” Not worth mentioning, apparently, was that this was all about “cohesion” of power interests. In the same speech where Brzezinski endorsed “greater cohesion” between the U.S. and the European Union, he criticized the EU for being “a Europe more of banks than of people, more of commercial convenience than an emotional commitment of the European peoples.”

It’s the type of “cohesion” that only bankers, corporations, and “grand strategists” like Kissinger and Brzezinski could like. So naturally, such an agreement has a great deal of support, encouragement, and organized planning. While the idea of ‘transatlantic integration’ has long been on the lips and in the documents of grand strategists and corporate-financed think tanks, it kept its distance from formal policy. In 2007, the EU-US summit meeting of leaders – US President Bush, German Chancellor Angela Merkel, and European Commission President José Manuel Barroso – established the Transatlantic Economic Council (TEC) to promote economic cooperation between the two regions.

The economic crisis itself delayed any progress from taking place, as countries focused on rescuing their banks and imposing austerity measures in order to punish their populations into poverty, privatize society, and create the conditions ripe for unhindered plundering of resources and exploitation of labour. This is called “structural reform.” But structural reforms only show “success” when corporations begin profiting from them. That’s called an “economic recovery.” There is an entire language to the European debt crisis – and to political economy in general – which, when translated, helps to elucidate the rationality of policy choices.

Political Language: Words or Weapons?

As George Orwell once wrote: “Political language… is designed to make lies sound truthful and murder respectable, and to give an appearance of solidity to pure wind.”

In a world undergoing radical transformations in political, economic, and social structures and relations – from the Arab Spring, the global economic crisis, food crisis and land grabs, to the global spread of protest movements – political language becomes weaponized. Hiding behind seemingly meaningless words, obscured by over-used rhetoric and abstract, undefined terms and concepts, political and economic language function by preventing the population from understanding the true meaning and implications of the policies pursued.

Take, for example, the word ‘austerity.’ It has been used endlessly – in rhetoric and policies – as the ‘solution’ to the economic, financial, and debt crises, but it’s meaning is obscured as an abstract notion of cutting public spending in order to decrease the debt, and thus, increase investor confidence in the country. This is supposed to lead to an economic “recovery.” The problem is that it doesn’t: it leads to a very deep depression. Yet, the policies continue to be promoted and pursued.

What can one deduct from this? If the rhetoric promotes specific policies for a desired effect, and the desired effect is never met, yet the rhetoric and policies continue to be promoted, we can assume one of two things: either, as Einstein defined it, the world’s decision-makers are all insane (“doing the same thing over again, expecting different results”); or, they are simply speaking a different language, and we lack an understanding of it. In such circumstances, it is helpful to attempt translating this language.

The policies of ‘austerity’ include firing public sector workers, cutting spending on health care, education, welfare, social services, pensions, increasing the retirement age, increasing taxes and decreasing wages. The results, inevitably, is impoverishment of the general population, increased unemployment, the elimination of health and social services when needed most, increased cost of living and decreased standards of living. Thus, we can loosely translate ‘austerity’ as impoverishment, since that is what the actual effects of the policies have.

In March 2010, the OECD (Organisation for Economic Co-operation and Development) suggested Europe undertake a program of austerity lasting for no less than six years from 2011 to 2017, which the Financial Times referred to as “highly sensible.” In April of 2010, the Bank for International Settlements (BIS) – the central bank to the world’s central banks – called for European nations to begin implementing austerity measures. In June of 2010, the G20 finance ministers agreed: it was time to enter the age of austerity! German Chancellor Angela Merkel, the European midwife of austerity, set an example for the EU by imposing austerity measures at home in Germany. The G20 leaders met and agreed that the time for stimulus had come to an end, and the time for austerity poverty was at hand. This was of course endorsed by the unelected technocratic president of the European Commission, José Manuel Barroso.

The unelected president of the European Council, Herman Van Rompuy, also agreed, explaining in his unrelenting economic wisdom that austerity “has no real effect on economic growth.” Jean-Claude Trichet, president of the European Central Bank (ECB), also hopped on the austerity train, writing in the Financial Times that, “now is the time to restore fiscal sustainability.” Jaime Caruana, General Manager of the Bank for International Settlements (BIS) stated in June of 2011 that the need for austerity was “more urgent” than ever, while BIS chairman, Christian Noyer, also the governor of the Bank of France (and board member of the ECB), stated that apart from austerity, “there’s no solution possible” for Greece.

But of course, austerity is not complete without its sister-program of ‘structural reform’ (or ‘structural adjustment’), which includes policies aimed at privatizing all state-owned assets, resources, and services, the dismantling of labour and environmental protections and regulations, the opening of new ‘markets,’ and enormous subsidies and protections for multinational banks and corporations.

Why is this done? To promote investment, competition, and growth. Privatizing everything in sight – including airports, land, water management, roads and resources – encourages investment because corporations can come in and purchase national assets for pennies on the dollars. Indeed, most privatization programs include enormous subsidies and protections for corporations in order to provide an incentive for them to invest. And competition is best promoted by allowing just a handful of transnational conglomerates to cheaply acquire a nation’s wealth and resources, and then by promoting what’s called “labour flexibility.” These ‘reforms’ mean that workers’ rights are to be dismantled, cutting wages, benefits, protections, the ability to unionize and make demands, to make the labour force flexible to the demand of big business, who demand little more than a cheap labour force (as well as absolute control of the global economy). Thus, across markets – Europe for the EU, North America for NAFTA – and indeed, across the world, labour forces are put into competition with one another in a race to the bottom of who can be the best, and therefore, cheapest labour available – in order to attract investment and jobs.

Thus, the effect of ‘structural reforms’ is to facilitate the exploitation of resources and people and to consolidate economic and political power into corporate hands. Austerity thus serves the purpose of impoverishing the population to make them ready and willing to accept the structural reforms (or “adjustment”) which adjust them to a situation of social devastation by making them into an employable – and cheap – labour force. Unhindered corporate plundering is facilitated by dismantling all “barriers” to investment, and thus, control of the entire economy. Austerity and structural reform create the conditions for investment, competition, and growth. Investment essentially means subsidized acquisition/control over the economy by corporations, competition implies protection for corporate interests, and growth means that corporations are making massive profits. The effect of all these policies and programs is to consolidate regional and global economic and political power into the hands of cosmopolitical corporations.

Austerity is impoverishment for populations.

Structural reform is exploitation of people/resources, and consolidation of political power in corporate hands.

Investment is corporate control of the economy.

Competition is protectionism for corporations.

Growth is corporate profits.

Mario Draghi is the president of the European Central Bank (ECB) – one of the three institutions of the ‘Troika’ with the European Commission and IMF – imposing austerity and structural reform measures across Europe in return for bailing out bankers. In February of 2012, he gave an interview with the Wall Street Journalin which he explained that, “there was no alternative to fiscal consolidation,” meaning austerity, and that Europe’s social contract was “obsolete” and the social model was “already gone.” However, Draghi explained, it was now necessary to promote “growth,” adding, “and that’s why structural reforms are so important.”

In addition to austerity and structural reforms, new markets are required, and thus, “free trade” must be promoted. This is all part of the road to ‘recovery.’ Free trade also has a technical definition: its policies dismantle environmental, labour, and other social protections, increase privatization, deregulation, and include large subsidies and protections for corporations. And today’s ‘free trade’ agreements grant unprecedented rights to corporations to sue governments directly for having laws or regulations which corporations view as “barriers to investment.” Free trade thus promotes competition between populations – in a race to the bottom – and protection for the powerful, for corporations and banks. What we call free trade agreements essentially function as a process of corporate colonialism: the regional and global consolidation of financial, economic, political and social power into relatively few corporate hands.

With the onset of the global economic crisis in 2008, countries turned to bailouts to rescue the large banks that destroyed their economies. In doing this, they accumulated large debts, handing the bill to the populations. The people pay for the debts through austerity, and thus, poverty, which in turn necessitates structural reform, and thus, exploitation. Free trade agreements like the Trans-Pacific Partnership (TPP), being negotiated between 12 Pacific-rim countries, facilitate transnational corporate colonialism.

A new corporate world is emerging, and the transatlantic partnership is a centerpiece in constructing this ‘new world order.’ While the crisis had initially stalled the process, it was revived at the EU-US summit meeting in November of 2011, when political leaders ordered the Transatlantic Economic Council (TEC) to create a High-Level Working Group on Jobs and Growth, led by U.S. Trade Representative Ron Kirk and EU Trade Commissioner Karel De Gucht, “tasked to identify policies and measures to increase U.S.-E.U. trade and investment to support mutually beneficial job creation, economic growth, and international competitiveness,” by working closely with both public and private sector/corporate groups.

The Transatlantic Corporate Complex

The impetus for the Transatlantic Trade and Investment Partnership was provided by a plethora of corporate-dominated think tanks and big business organizations, including the Atlantic Council, Brookings Institution, the German Marshall Fund, BusinessEurope, the Business Roundtable, the U.S. Chamber of Commerce, and the European Round Table of Industrialists, among several others. These institutions collectively form a transatlantic corporate complex, uniting elites from major corporations, banks, think tanks, foundations, academia and policy circles in order to establish consensus on elite agendas and to provide the strategies and objectives to be implemented.

The Atlantic Council was founded in 1961 by former U.S. Secretary of State Dean Acheson and several other prominent citizens in the United States in order to help consolidate support for the ‘Atlantic Alliance.’ The Atlantic Council’s first published volume, Building the American-European Market: Planning for the 1970s, was published in 1967, and the Council continued to publish policy papers, books, monographs and other reports throughout the 1970s.

The Atlantic Council’s leadership and direction is provided by the members of its boards, consisting of the foreign policy elite of the United States as well as major cosmopolitical corporations, including the likes of Henry Kissinger, Zbigniew Brzezinski and Madeleine Albright along with executives from corporations such as Deutsche Bank, BAE, and Lockheed Martin. [For a look at some of the other names of directors and advisors, see Appendix 1]

The Atlantic Council thus represents the interests of trans-Atlantic corporate and financial interests and the foreign policy elite within the United States. Thus, what issues and agendas they promote tend to wield significant influence behind them, with extensive access to policy-makers and processes. Back in 2004, the Atlantic Council published a report, The Transatlantic Economy in 2020: A Partnership for the Future? in which they recommended increasing integration between the two economies and regions, the joint management of the world economy, and more “transgovernmental cooperation.”

The German Marshall Fund of the United States was founded in 1972 with a donation from the German government to Harvard University, where 25-years prior U.S. Secretary of State George Marshall announced the Marshall Plan for Europe’s economic recovery after World War II. The German Marshall Fund (GMF) “is dedicated to the promotion of greater understanding and common action between Europe and the United States,” and includes a number of corporate executives, news commentators and other elites on its leadership boards [See Appendix 2].

The Business Roundtable (BRT) is an organization of CEOs from major U.S. corporations “with more than $7.3 trillion in annual revenues,” according to its website. The BRT was founded in 1972 “on the belief that... businesses should play an active and effective role in the formation of public policy.” The Chairman of the Executive Committee of the BRT is W. James McNerney, the president and CEO of Boeing. The Executive Committee includes the CEOs of a number of other major cosmopolitical corporations [see Appendix 3].

The European Round Table of Industrialists (ERT), founded in 1983, is an organization of several dozens CEOs of major European corporations. As Bastiaan van Apeldoorn wrote in the journal New Political Economy(Vol. 5, No. 2, 2000), the ERT “developed into an elite platform for an emergent European transnational capitalist class from which it can formulate a common strategy and – on the basis of that strategy – seek to shape European socioeconomic governance through its privileged access to the European institutions.” Wisse Dekker, former Chairman of the ERT, once stated: “I would consider the Round Table to be more than a lobby group as it helps to shape policies. The Round Table’s relationship with Brussels [the EU] is one of strong co-operation. It is a dialogue which often begins at a very early stage in the development of policies and directives.”

The ERT was a central institution in the re-launching of European integration from the 1980s onward, and as former European Commissioner (and former ERT member) Peter Sutherland stated, “one can argue that the whole completion of the internal market project was initiated not by governments but by the Round Table, and by members of it... And I think it played a fairly consistent role subsequently in dialoguing with the Commission on practical steps to implement market liberalization.” Sutherland also explained that the ERT and its members “have to be at the highest levels of companies and virtually all of them have unimpeded access to government leaders because of the position of their companies... So, by definition, each member of the ERT has access at the highest level to government.” [For a list of other corporations represented on the board of the ERT, see Appendix 4]

BusinessEurope is Europe’s main business group, representing 41 business federations in 35 countries with its “main task” – according to its website – being “to ensure that companies’ interests are represented and defended vis-à-vis the European institutions with the principal aim of preserving and strengthening corporate competitiveness.” [For a look at some of the companies that made up the Corporate Advisory and Support Group, see Appendix 5]

The U.S. Chamber of Commerce was founded in 1912 as an umbrella organization representing the voice of business throughout the United States. According to its website, the Chamber “works with more than 1,500 volunteers from member corporations, organizations, and the academic community who serve on committees, subcommittees, task forces, and councils to develop and implement policy on major issues affecting business.” Their “overarching mission” is “to strengthen the competitiveness of the U.S. economy.” [For a look at some of the companies represented on the board of directors of the Chamber, see Appendix 6]

The Transatlantic Business Dialogue (TABD) was formed in 1995 by the U.S. Department of Commerce and the European Commission in an effort to “serve as the official dialogue between American and European business leaders and U.S. cabinet secretaries and EU commissioners,” composed of CEOs of U.S. and European transnational corporations.

Transatlantic Corporate Colonialism in Action: Shaping the Agenda

As with any “free trade” agreement (read: cosmopolitical corporate consolidation agreement), corporations must be consulted throughout the entire process to allow them to shape the agenda and encourage specific policies, to ensure that their interests are met. Think tanks employ academics and foreign policy elites to undertake studies and produce reports which advocate policies beneficial to western political and economic domination of the world. Big business groups organize the corporate community around agendas and provide a direct “voice” to the corporate world. The boards of think tanks are dominated by political and corporate elites, and once think tanks begin to establish consensus on agendas, academics and other officials from the organizations write articles or are interviewed frequently in the media (which is owned by the same corporations), to ensure that what little is said in public about such agreements is indeed, positive and encouraging.

  

When the Transatlantic Economic Council (TEC) created the High-Level Working Group on Jobs and Growth in November of 2011, it announced its intent to ‘consult’ with private sector organizations on the process of transatlantic integration.

The Transatlantic Business Dialogue (TABD) was one of the first major corporate organizations to support the announcement of the High-Level Working Group. In January of 2012, the TABD met with high level EU and US officials at the annual World Economic Forum meeting in Davos, Switzerland. They released a report, Vision for the Future of EU-US Economic Relations, which established a consensus “to press for urgent action on an visionary and ambitious agenda,” as well as for the creation of a “CEO Task Force” which would “provide direct input and support the High Level Working Group.”

The meeting was attended not only by the 21 members of the executive board of the TABD (all corporate executives), but officials representing the Atlantic Council, the Canadian Council of Chief Executives (CCCE), the US Chamber of Commerce, World Trade Organization Director-General Pascal Lamy, US Trade Representative Ron Kirk, European Commissioner for Trade Karel De Gucht, European Commissioner for Competition, Joaquin Almunia; Jon Leibowitz, chairman of the Federal Trade Commission, and Michael Froman, Obama’s Deputy National Security Advisor for International Economic Affairs.

That same month, the TABD and the Business Roundtable (BRT) released a joint statement outlining their “vision” of a Transatlantic Partnership (TAP) – modeled along similar lines as the Trans-Pacific Partnership (TPP) – which would require a further “opening” of the trans-Atlantic market, being able to “compete” with other major economies (such as China), and “deepening the multilateral commitment to open markets.” As major CEOs and executives, the statement wrote, “we need nothing less” than a “strategic vision and structure [which] will need to serve as a global template.”

In February of 2012, the German Marshall Fund released a report from the Transatlantic Task Force on Trade and Investment entitled, A New Era for Transatlantic Trade Leadership. The task force was co-chaired by Ewa Bjorling, the Swedish Minister for Trade, and Jim Kolbe, a former U.S. Congressman and Senior Transatlantic Fellow at the GMF. [For other members of the Task Force, see Appendix 7] The Task Force was launched as a cooperative effort between the German Marshall Fund and the European Centre for International Political Economy (ECIPE) in May of 2011.

The report called for the EU and US to pursue “deeper transatlantic economic integration” as “essential for recovery from the current economic crisis.” The report called for “high-level commitment from political leaders on both sides of the Atlantic” and “it will require active involvement of private sector stakeholders,” or in other words, corporations.

In March of 2012, BusinessEurope released a report to contribute to the EU-US High Level Working Group entitled, Jobs and Growth: Through a Transatlantic Economic and Trade Partnership, in which it was recommended to eliminate tariffs and barriers, to trade in services, ensure access and protection for investments, “opening markets,” to establish “global standards” for intellectual property rights, and to build on the Transatlantic Economic Council (TEC) for regulatory cooperation.

That same month, the U.S. Chamber of Commerce sent a letter to Congress in which the U.S. Chamber, BusinessEurope, American Chamber of Commerce to the European Union, the Business Roundtable, European-American Business Council, the Trans-Atlantic Business Dialogue, and several other big business associations called upon political leaders “to move swiftly to deepen the transatlantic economic and commercial relationship through ambitious trade, investment, and regulatory policy initiatives.” Thus, in the midst of an economic and social crisis created by the very corporations and banks these associations represent, and with the emergence of new economic giants like China and India, “we believe now is the time to create a barrier-free transatlantic market to drive the job creation and growth” that Europe and America “urgently need.”

The High Level Working Group – chaired by USTR Ron Kirk and EU Trade Commissioner Karel De Gucht – should have a “far-reaching” agenda, the statement wrote, which would cover: “tariff and non-tariff barriers to trade in goods and services, investment, regulatory cooperation, intellectual property protection and innovation, public procurement, cross-border data flows, and business mobility.” The statement noted that they had received “support” from Angela Merkel, David Cameron, and then-President of France Nicolas Sarkozy, as well as from the European Council (presided over by Herman van Rompuy). From the American side, support was given by Hillary Clinton.

In May of 2012, the Business Roundtable, European Round Table of Industrialists and the Trans Atlantic Business Dialogue sent a joint letter to President Obama, French President Francois Hollande, German Chancellor Merkel, Italian PM Mario Monti, UK prime minister David Cameron, European Commission president José Manuel Barroso, European Council president Herman Van Rompuy, EU Trade Commissioner De Gucht and USTR Ron Kirk. The letter noted that the three organizations of corporate executives from across the Atlantic “have come together to lay out a strategic vision for a new Transatlantic Partnership (TAP),” and they together produced the report, Forging a Transatlantic Partnership for the 21st Century, to do just that. The report called for US and EU officials to launch “ambitious and comprehensive transatlantic trade, investment and regulatory negotiations by the end of this year.”

That same month, just to press the message, the presidents of the US Chamber of Commerce, the Business Roundtable, and the National Association of Manufacturers sent a joint letter to Obama urging him to launch negotiations to “trail blaze a true 21st century trade, investment, and regulatory cooperation initiative,” which apart from further integrating the economies, would also “have important benefits for defense and military cooperation as well.”

In June of 2012, Obama’s Export Council sent him a letter applauding the president for establishing the High Level Working Group the previous year, but urged him to “take the critical next step, in consultation with the private sector, to move forward quickly to define and launch a comprehensive and ambitious Transatlantic Partnership (TAP) negotiation.” They recommended the usual protections for intellectual property rights, liberalization of services, “elimination of industrial and agricultural goods tariffs,” among many things. The letter was signed by Export Council chairman Jim McNerney, the president and CEO of the Boeing Company.

The U.S. President’s Export Council (PEC) “is the principal national advisory committee on international trade,” founded in 1973, consisting of 28 private sector members, as well as Congress members and cabinet secretaries. The PEC reports to the president through the U.S. Secretary of Commerce. [For a list of corporations represented by the PEC, see Appendix 8]

Not wasting any time, the High Level Working Group on Jobs and Growth released their interim report to their leaders in June of 2012 from the co-chairs, De Gucht and Kirk. Among other things, they recommended the “elimination” of “barriers to trade” in goods, services, and investment. They recommended a “comprehensive agreement” which “could promote a forward-looking agenda for multilateral trade liberalization.” The “aim” of the negotiations, they wrote, would be to “bind” the EU and US “at the highest level of liberalization” and “achieve new market access.” They were taking the recommendations from corporate groups seriously, and pushing those words into policies.

Paula Dobriansky, a prominent academic at the Atlantic Institute, co-authored an article for the Wall Street Journal in which she called for “a trans-Atlantic free-trade agreement” between the EU and US in order to “strengthen American and European leadership for decades to come.” Frances Burwell, Atlantic Council vice president and director of the Program on Transatlantic Relations published an article for US News & World Report in November of 2012 in which she wrote that “creating a single transatlantic market... makes a great deal of sense.”

In November of 2012, then-Secretary of State Hillary Clinton gave a speech to the Brookings Institution entitled, U.S. and Europe: A Revitalized Global Partnership, in which she noted: “we have to realize the untapped potential of the transatlantic market...  is as much a strategic imperative as an economic one.” Informing the audience that the Obama administration was “discussing possible negotiations” with the EU on such an agreement, Clinton said it “would shore up our global competitiveness for the next century.”

Also in November, Atlantic Council board member James L. Jones (former U.S. National Security Advisor to Barack Obama) and Thomas J. Donohue (President and CEO of the US Chamber of Commerce) co-authored an article for Investor’s Business Dailyin which they suggested that the simultaneous economic crises in Europe and the U.S. – which they defined as “flagging competitiveness, unsustainable entitlement spending, and the ticking time bomb of oversize sovereign debt” – were a threat to the future of NATO’s ability to “tackle urgent security threats” and that this poses “the greatest challenge to the future of the trans-Atlantic community since the Cold War.”

Sustainable growth, they wrote, “only comes from one place – the private sector.” Governments have a “responsibility... to create conditions in which the private sector can drive economic expansion, investment and job creation.” An “ambitious trans-Atlantic economic and trade pact” would certainly fit this prescription of increasing “growth” and “competitiveness.” It was time, they wrote, “to move decisively to the next level of trans-Atlantic economic integration.”

Within days of Obama winning his re-election, European leaders such as David Cameron and Angela Merkel urged him to move forward with the agreement, and the New York Times even noted that “corporations and business groups on both sides of the Atlantic are also pushing hard for a pact.” Former deputy U.S. trade representative and current vice president at General Electric, Karan Bhatia, noted: “This could be the biggest, most valuable free-trade agreement by far, even if it produces only a marginal increase in trade.”

The Financial Times said that a “transatlantic partnership” would yield “geostrategic benefits,” since the EU and US account for half the world’s economy, and thus, they will “possess the leverage to set the global standards that others, including China, are likely to follow.” Since “both the EU and US are desperate for new growth,” wrote Edward Luce, the “only realistic route is via higher productivity,” implying cheaper costs and larger profits for corporations. It would be “an ambitious agenda for transatlantic market integration” including harmonizing regulations and product standards. In other words, wrote Luce: “if a drug were approved by the European Medicines Agency, the Food and Drug Administration would accept it too.” The same would apply for “financial regulation” (or lack thereof), as well as agricultural (GMO) standards, a key issue, since the EU has a ban on such products. The EU had recently shown its enthusiasm for change when it “dropped its objections to imports of US meat from abattoirs [slaughterhouses] decontaminated with lactic acid.” In the EU, “the climate of austerity ought to work in their favour” for reducing protections to do with agriculture.

In January of 2013, the Brookings Institution sent a ‘memorandum to the president’ to Barack Obama entitled, Free Trade Game Changer, in which the authors recommended pursuing both the Trans Pacific Partnership (TPP) and the Trans-Atlantic Free Trade Agreement (TAFTA) as “the most realistic way to reclaim U.S. economic leadership.” The agreements have “deep strategic implications” since they would provide the US with a leading “role in setting the global rules of the road.” While the TPP “would help define the standard for economic integration in Asia,” the TAFTA “would give American and European businesses an edge in setting industrial standards for tomorrow’s global economy.” While “the erosion of support for FTAs [free trade agreements] in Congress and among the public is likely to hamper this effort,” the memo reminded Obama that public opinion must be disregarded in the corporate interest: “the time has come to launch new initiatives in these spheres.”

In early 2013, the Trans-Atlantic Business Dialogue merged with the European-American Business Council to become the Transatlantic Business Council (TBC), a group consisting of corporate executives who hold “semi-annual meetings with U.S. Cabinet Secretaries and European Commissioners (in Davos and elsewhere),” acting as the “business advisor to the Transatlantic Economic Council (TEC).” It represents some 70 major corporations, including: AIG, AT&T, BASF, BP, Deutsche Bank, EADS, ENI, Ford, GE, IBM, Intel, Merck, Pfizer, Siemens, TOTAL, Verizon, and Xerox, among others.

In January of 2013, the Transatlantic Business Council (TBC) met in Davos, Switzerland during the annual World Economic Forum, holding a meeting with high level officials in the U.S. and E.U. Michael Froman, President Obama’s Deputy National Security Advisor for International Economic Affairs, spoke at the TBC meeting, declaring that “the transatlantic economy is to become the global benchmark for standards in a globalized world.” Froman and the leaders of the TBC “agreed that support from corporations operating on both sides of the Atlantic is crucial to advance transatlantic trade.”

Tim Bennett, the Director General of the TBC, stated that the structure of the TBC “allows for a combination of strong business message to policy makers as well as substantive input through working groups,” referring to high level meetings in Washington and Brussels. Other participants at the TBC meeting included the Secretary General of the OECD, Angel Gurria, Irish Prime Minister Enda Kenny, European Commission Director-General for Trade, Jean-Luc Demarty, European Commission for Trade official, Marc Vanheukelen, and a former Citigroup executive.

On the Transnational Business Council (TBC)’s website, they promote specific think tanks as providing “resources”: the Atlantic Council, Bertelsmann Foundation, Brookings Institution, Center for Transatlantic Relations, Chatham House, the German Marshall Fund, and the Peterson Institute for International Relations.

The Final Report: Time to Do What the Corporations Demand!

On February 11, 2013, the U.S.-EU High Level Working Group (HLWG) on Jobs and Growth released their final report in which they predictably recommended harmonizing standards and regulations in “a comprehensive trade and investment agreement.” The report recommended “a further deepening of economic integration... to achieve a market access package that goes beyond what the United States and the EU have achieve in previous agreements.” The report further recommended increasing “government procurement,” a euphemism for privatization and state subsidies for corporations, noting: “the goal of negotiations should be to enhance business opportunities through substantially improved access to government procurement opportunities at all levels of government.”

Two days following the publication of this report, on 13 February 2013, a joint statement was issued by Barack Obama, European Council President Herman Van Rompuy and European Commission President José Manuel Barroso, stating: “We, the Leaders of the United States and the European Union, are pleased to announce that... the United States and the European Union will each initiate the internal procedures necessary to launch negotiations on a Transatlantic Trade and Investment Partnership.”

With the announcement of the TTIP in February, then-U.S. Trade representative Ron Kirk stated that, “[f]or us, everything is on the table, across all sectors, including across the agricultural sector, whether it is GMOs or other issues.” He explained that “we should be ambitious and we should deal with all of these issues.” João Vale de Almeida, the European Union ambassador to the United States, wrote in an article that “an ambitious economic agreement between us would send a powerful message to the rest of the world about our leadership in shaping global economic governance in line with our values,” which is to say, corporate “values.”

The German media – and government officials – erupted in admiration of the potential for this “economic NATO” in creating “the world’s largest free trade zone.” One German publication noted that “a new economic alliance” between NATO powers was appropriate, since “the old industrialized nations fear they are falling behind the emerging economic power of China.” Another German publication noted that not only would a “trans-Atlantic free-trade zone” have major economic “benefits” and implications, “but it also makes clear that only an ever-closer West can succeed in decisively helping to determine global policy.”

The corporate world expressed immediate admiration for the announced negotiations, with the chairman and CEO of Caterpillar “commending” US and EU leaders and the High-Level Working Group “for promoting much needed economic growth and job creation.” The president of the Business Roundtable (BRT), John Engler, noted that the Roundtable itself “was an early advocate” for such an agreement, and that “negotiations should launch as soon as possible.”

C. Boyden Gray, a member of the Atlantic Council’s board of directors and former U.S. ambassador to the European Union, published a report for the Atlantic Council in February of 2013 entitled, An Economic NATO: A New Alliance for a New Global Order. Gray warned that unless the Atlantic powers “rise to the challenge... of the post-recession era together... they risk ceding to rising powers their economic and political influence.” This must not be simply a “free trade agreement,” but rather, the US and EU “must put economic cooperation on the same robust footing as military security... we need to create an ‘economic NATO’.”

The Wall Street Journal noted that the announcement “represents a nod to business interests by Mr. Obama,” noting that it was less about ‘trade’ and more about establishing global standards. European Commission president Barroso expressed as much when he said, “this is going to be the biggest free-trade agreement ever done, [and] it will certainly have an impact on global standards.” Obama’s international economic policy adviser Michael Froman noted that the agreement would “further integrate our economies and help set global rules.” EU trade commissioner Karel de Gucht added: “What we want to do is make an internal market between the US and EU.”

The Financial Times noted that while it was “commonplace” to imagine that the future belonged to the emerging economies, “the old economic powers can still pack a punch.” The agreement “promises a prize whose political value is even greater than its considerable economic benefits.” Hence, we must understand these “free trade agreements” as, in actuality, cosmopolitical corporate consolidation agreements.

While U.S. Secretary of State John Kerry traveled to Berlin in late February, he endorsed the agreement, suggesting that it “can lift the economy of Europe, strengthen our economy, create jobs for Americans, for Germans, for all Europeans and create one of the largest allied markets in the world.”

The German press warned that Internet activists, environmental, labour and consumer groups were “preparing to fight the treaty with all means at their disposal,” as they feared that “bad compromises will be made at the expense of consumers in secret negotiations between the European Commission and the Obama administration.” Enforcing equal standards for food products worries many in the EU regarding American-produced genetically engineered food products, such as corn, soybeans and beets; while intellectual property rights issues increasingly threaten the freedom of the Internet for the benefit of corporate and financial interests, such as through the failed Anti-Counterfeiting Trade Agreement (ACTA), which was overcome by a large Internet campaign and protests against it. One of the organizers for the anti-ACTA movement, Jérémie Zimmermann, stated: “Millions of citizens can be mobilized if their freedoms are threatened.” Still, despite the growing unease and opposition to such an agreement, which would be based primarily around these highly contentious issues as opposed to actual “trade” or tariffs, German Chancellor Angela Merkel declared the deal as “by far our most important project for the future.”

Max Baucus, the chairman of the U.S. Senate finance committee, wrote an article for the Financial Times in which he stated that the agreement was “a deal that must be done, it must be done now, and it must be done right... As chairman of the committee overseeing US trade, I will support a deal only if it gives America’s producers the opportunity to compete in the world’s biggest market.”

Speaking at Harvard in early March, Karel de Gucht referred to the agreement as “the cheapest stimulus package you can imagine,” adding that it was “a policy laboratory for the new trade rules we need – on issues like regulatory barriers, competition policy, localization requirements, raw materials and energy.”

Barack Obama stated that he was “modestly optimistic” about the agreement, as the US was moving “aggressively” while the EU was “hungrier for a deal than they have been in the past.” Speaking to the President’s Export Council, composed of executives from major corporations acting as ‘advisors,’ Obama reaffirmed that, “we want our Fortune 500 companies to be selling as much as possible.” John Kerry told a group of French business leaders that, “if we move rapidly... [the agreement] can have a profound impact on the rest of the world.”

Robert Zoellick, former president of the World Bank, strongly endorsed the agreement, noting that it could “set a precedent” in setting standards for the global economy, adding: “We need to create a new structure for the global system.” However, he warned, agriculture was “going to be one of the most difficult issues,” due to the concern over genetically modified organisms. Barroso warned that, “the EU will only go so far.” Lori Wallach, the director of Public Citizen’s Global Trade Watch observed: “This whole negotiation is about eliminating ‘trade irritants’ but in the US consumer movement we envy and admire and seek to emulate the European food safety standards, while industry is seeking to kill them.”

In April of 2013, a “coalition” was launched to promote the Transatlantic Trade and Investment Partnership called the Business Coalition for Transatlantic Trade (BCTT), which “seeks to promote growth, jobs, and competitiveness on both sides of the Atlantic through an ambitious, comprehensive and high-standard trade and investment agreement.” The Steering Committee for the BCTT consists of a number of multinational corporations and business associations, and the secretariat is the U.S. Chamber of Commerce. The corporate co-chairs for the coalition include Amway, Chrysler, Citi, Dow, FedEx, Ford, GE, IBM, Intel, Johnson & Johnson, Lilly, MetLife, UPS, and JPMorgan Chase. Partner associations of the BCTT include the Business Roundtable, Coalition of Service Industries, the Emergency Committee for American Trade, the National Association of Manufacturers, the National Foreign Trade Council, the Transatlantic Business Council (TBC), the U.S. Chamber of Commerce and the U.S. Council for International Business. The initial objective of the BCTT was to urge the formal launching of negotiations by June or July of 2013, as well as “sustaining broad bipartisan support and on providing detailed inputs once negotiations are underway.”

At the launch of the BCTT, the U.S. Chamber of Commerce’s vice president and head of international affairs, Myron Brilliant, noted that there was “vast support” for the agreement “both in the government and the private sector.” The business community, he explained, “is committed to assisting with the negotiation of a transatlantic agreement... and we will continue our efforts to encourage both governments to get this deal done quickly.” The Business Roundtable, a member of the BCTT, endorsed the new coalition in a statement from John Engler, who explained, “we look forward to working with Congress and the Administration to ensure a comprehensive and ambitious agreement.” While speaking to an American business group, the British ambassador to the United States said that financial services would also be “covered by these negotiations,” noting that the U.S. and U.K. are home to “the two most significant international financial centres, on either side of the Atlantic,” on Wall Street and the City of London.

According to an Obama administration official involved in the talks, the agreement “would grant corporations new political power to challenge an array of regulations both at home and abroad.” Environmental, consumer, and other interest groups fear that the agreement “will lead to a rollback of important rules and put multinational companies on the same political plane as sovereign nations.” This would be facilitated by an “investor-state dispute resolution” mechanism, which means that corporations could directly sue governments over what they perceive as “barriers to investment” – possibly through an international tribunal (perhaps even through the World Bank). Such a tribunal “would be given authority to impose economic sanctions against any country that violated its verdict.”

Such provisions, noted a trade specialist with the Sierra Club, “elevate corporations to the level of nation states and allow them to sue governments over nearly any law or policy which reduces their future profits.” These mechanisms are “terribly risky for communities, the environment, and our climate.” The “dirty little secret,” noted Public Citizen’s Lori Wallach, “is that it is not mainly about trade, but rather would target for elimination the strongest consumer, health, safety, privacy, environmental and other public interest policies on either side of the Atlantic.”

Thomas Donohue, the president of the US Chamber of Commerce, couldn’t be happier.  “If they made a deal tomorrow,” he said in April of 2013, “US and European companies are sitting on a boatload of cash and they’d be moving this thing up as fast as they can move.” Corporations would be able to make a profit faster than anticipated, he noted: “You open a door and say there’s money on the other side, there’s opportunity to expand, to export, to sell their products, to make partnerships... You think they’re going to wait around till 2027? They’ll be through the door before you know it.” Donohue encouraged negotiations to begin as soon as possible, “they must, they need to,” adding: “We don’t need to take our time.”

A Transatlantic Agenda for Austerity, Exploitation and Corporate Consolidation

On April 22, 2013, there was a conference hosted at the Federal Reserve Bank of New York in co-operation with the European Commission’s Directorate General for Economic and Financial Affairs, “bring[ing] together US-and Europe-based policy makers, regulators, market analysts and academics.” The aim of the conference was to “evaluate the prospects for sustainable economic growth and financial stability, and discuss challenges to transatlantic economic relations posed by the recent episodes of the economic crisis.” Speakers included New York Fed president William Dudley and Vice President of the European Commission, Olli Rehn. [For a list of other participants, see Appendix 9]

William Dudley has been president of the New York Fed since 2009, when the previous president – Timothy Geithner – became Obama’s Treasury Secretary. Prior to his new position, Dudley was a partner and managing director at Goldman Sachs; and currently he also serves as chairman of the Committee on the Global Financial System at the Bank for International Settlements (BIS), and is vice chairman of the Economic Club of New York.

Dudley opened the ‘invitation only’ event by suggesting, “in a global economy with a global financial system... regulation and supervision have a decidedly national orientation.” Thus, he explained, “we [must] seek to balance our domestic needs against the benefits from having a harmonized and integrated global system.” What is needed, said Dudley, is “growth.” But there was “good news” in the U.S., the housing sector was re-inflating – what’s called “recovering,” the middle class “household sector” was struggling under a heavy debt burden (called “deleveraging”), but the banking sector was “healthier” (meaning more profitable), and “the corporate sector is highly profitable and awash in cash.” That’s the “good news.”

A Bloomberg article from 2010 referred to the Federal Reserve Bank of New York as “a black-ops outfit for the nation’s central bank,” noting that it was in fact a “quasi-governmental institution,” whose leadership is appointed by the major banks of Wall Street to represent their interests, and was “the preferred vehicle for many of the Fed’s bailout programs.” The New York Fed is actually a private bank with a great deal of public authority, and is subject to a “culture of secrecy” which was described as “pervasive.” On the board of directors of the New York Fed is Jamie Dimon, the CEO of JPMorgan Chase, as well as several other bankers.

In his speech, Dudley explained that he has guided the New York Fed to purchase long-term U.S. Treasuries (U.S. government debt) and mortgage-backed securities (the same purchases which helped create the previous housing bubble) to the tune of $85 billion “each month.” Noting that the United States has begun down the path of national austerity – “fiscal consolidation” – and must continue deeper, there was a “tug of war” between having a good economy and having austerity, which is a delicate way of saying that the austerity measures will destroy the economy (something the Europeans already know very well). Thus, as Dudley explained, with immense corporate and bank profits, an asset bubble, and a coming austerity-driven economic nose-dive, “the level of uncertainty about the near-term outlook in the United States remains quite high.” But the United States was not geared “toward a growth path” based upon “business investment” and “trade,” instead having only focused on debt-based consumption.

In Europe, however, the outlook was “less bright.” But again, there was “good news,” since the “peripheral countries” such as Greece, Spain, Italy, Portugal, Ireland, and others, were successfully imposing harsh austerity measures, despite resistance from the population being impoverished. This, Dudley calls, “substantial efforts to bring down their structural budget deficits.” There was also progress on improving their “international competitiveness,” which is to say they are opening up to exploitation and plundering, though there was still “an opportunity for further structural reforms in labor and product markets.” Though of course this shouldn’t be done “just in the periphery,” that type of “opportunity” exists everywhere, in order to bring efficiency in exploitation, and thus, more profits: “to increase productivity and strengthen long term growth prospects.”

Sadly, noted Dudley, there was also “bad news” in the EU, since the economy was “still in a recession” – or what could more accurately be described as a deep depression in the so-called “periphery” countries – where it was becoming harder to impose austerity measures and impoverish populations: “the political support for further rounds of budget-tightening has clearly lessened.” Without “growth” – meaning, without corporate and financial profits – “then the political support for continued fiscal and structural adjustment could further erode.” Europe also needed to pursue “deeper integration” at the governance level, and the development of a “pan-European banking union with the ECB [European Central Bank] as the primary overseer” was a “critically important next step.” This will of course demand each country in the EU “to give up a small amount of sovereignty with respect to banking oversight,” and hand it to the ECB, which is unaccountable and remains a driving force behind the austerity and adjustment programs. Dudley referred to this as the “one money, one market” concept.

Olli Rehn, European Commission Vice President and Commissioner for Economic and Monetary Affairs – a major driving force behind the austerity and adjustment programs – gave the keynote speech at the New York Fed conference. He began by welcoming the newly announced Transatlantic Trade and Investment Partnership, explaining that they must work hard to make it “a reality.” Europe, however, is “deleveraging” – which is to say the continent is being crushed by a heavy debt burden whose owners demand ‘austerity’ and ‘adjustment’ in addition to bailouts – and this “deleveraging process is going to take time, and we need to find new sources of growth to ease the burden of adjustment.” Thus, Rehn explained, “opening up global trade opportunities is so very important.” While many EU countries were continuing with harsh austerity measures, “structural reforms” – which facilitate exploitation of labour and resources – “are the key to raising the growth potential of the European economy.”

He finished his speech, stating: “we must stay the reform course. We need to deliver in terms of free trade, financial sector reform, structural reforms that boost growth potential, and consistent consolidation of public finances. We must do so in order to create the foundations for sustainable growth and job creation. Facing these challenges, we are indeed partners on both sides of the Atlantic.”

A Call for Trans-Atlantic Resistance to Corporate Tyranny

Europe is eating itself through austerity, plunging its population into poverty while simultaneously undertaking “structural reforms” designed to facilitate the unhindered exploitation of resources, markets and labour by transnational corporations. The United States has also been implementing austerity measures, though opting instead to create fallacious ‘debt dramas’ involving the pompous parading of meaningless words – ‘fiscal cliff’ and ‘sequester’ – to avoid the blatant promotion of ‘austerity,’ which might encourage people to correctly think of Greece as an example.

So-called “free trade” agreements function as transnational austerity and ‘structural reform’ treaties: they grant corporations unlimited access to markets, protect them from competition, heavily subsidize them, privatize anything and everything, deregulate as much as possible, destroy the environment, and facilitate the unimpeded plundering of resources and exploitation of labour.

Make no mistake: the Transatlantic Trade and Investment Partnership (TTIP) is little more than a transatlantic corporate coup. Corporations created the demand for the agreement, lobbied and promoted the agenda with political elites, and direct the entire process, ensuring that their interests are met.

It would seem, then, that it is time for activists, intellectuals, and communities and organizations of people to reach out across the Atlantic in an effort to create an organized resistance to transatlantic corporate tyranny, consolidation and colonization.

Corporations are undertaking unprecedented drives for the accumulation of profit and power, promoting agendas and projects which re-shape the world in their image, treating governments as toys, the environment as an enemy, and impoverishing populations around the world. We are witnessing a transnational social engineering project, driven by large corporations, aimed at facilitating economic, financial, political and social consolidation into their hands.

Welcome to the era of Cosmopolitical Corporate Consolidation and Colonization.

Will you accept that as legitimate? Will you accept such an agreement? Who agreed to it? Did you? Were you consulted? Have you even heard of it before?

The real question is: will we sit passively as we are led to Extinction Inc., or will we actually stand up, organize, and do something about it?

Appendix 1: Leadership of the Atlantic Council

Among the leadership on the board of directors of the Atlantic Council are Brent Scowcroft, former U.S. National Security Adviser (to presidents Ford and Bush, Sr.), Richard Armitage, James E. Cartwright, Wesley Clark, Paula Dobriansky, Christopher Dodd, Stephen Hadley, Michael Hayden, James L. Jones, Henry Kissinger, Thomas Pickering, Anne-Marie Slaughter, James Steinberg, John C. Whitehead, and with a group of honorary directors including: Madeleine Albright, James Baker, Harold Brown, Frank Carlucci, Robert Gates, Michael Mullen, William Perry, Colin Powell, Condoleezza Rice, James Schlesinger, George Shultz, and John Warner, among others.

On the Business and Economics Advisors Group to the Atlantic Council, there are executives and management from the following companies and institutions: Deutsche Bank, Institute of International Finance, Center for Global Development, AIG, BNP-Paribas, Rock Creek Global Advisors, the Stern Group, Harvard, and the Peterson Institute for International Economics. The International Advisory Board of the Atlantic Council includes Josef Ackermann (Chairman of Zurich Insurance), Shaukat Aziz (former prime minister of Pakistan), Jose Maria Aznar (former PM of Spain), Zbigniew Brzezinski (former US National Security Advisor), and with top executives from: Occidental Petroleum, SAIC, the Coca-Cola Company, PwC, News Corporation, Royal Bank of Canada, BAE Systems, the Blackstone Group, Thomson Reuters, Lockheed Martin, Bertelsmann, Novartis, and Investor AB, among others.

Appendix 2: Leadership of the German Marshall Fund

The board of trustees of the GMF includes a host of corporate executives and news commentators, and their funding also comes from a coterie of governments, major foundations, and multinational corporations including: Bank of America Foundation, BP, Daimler, Eli Lilly & Company, General Dynamics, IBM, NATO, Rockefeller Brothers Fund, and USAID, among many others.

Appendix 3: Leadership of the Business Roundtable

Other members of the executive committee include the CEOs of Honeywell, Dow Chemical, Procter & Gamble, MasterCard, Xerox, American Express, Eaton, JPMorgan Chase, Wal-Mart, General Electric, Caesars Entertainment, Caterpillar, McGraw-Hill, State Farm Insurance, AT&T, Frontier Communications, and ExxonMobil.

Appendix 4: Leadership of the ERT

As of 2013, members of the ERT included the CEOs of Ericsson, Siemens, Telecom Italia, BASF, Nestlé, Repsol, ThyssenKrupp, TOTAL, Rio Tinto, Fiat, Nokia, EADS, ABB, Lafarge, GDF SUEZ, BMW, Eni, BP, Royal Dutch Shell and Investor AB, among many others.

Appendix 5: Corporate Partners of BusinessEurope

BusinessEurope counts among its “partner companies,” notable multinational conglomerates that make up the Corporate Advisory and Support Group who “enjoy an important status within BUSINESSEUROPE,” including: Accenture, Alcoa, BASF, Bayer, BMW, BP, Caterpillar, Diamler, DuPont, ExxonMobil, GDF Suez, GE, IBM, Microsoft, Pfizer, Shell, Siemens, Total, and Unilever, among many others.

Appendix 6: Companies Represented on the Board of the US Chamber of Commerce

The board of directors of the Chamber includes top executives and representatives from the following institutions and corporations: Accenture, Allianz of America, AT&T, Pfizer, FedEx, The Charles Schwab Corporation, Xerox, Rolls-Royce North America, Dow Chemical, Alcoa, UPS, Caterpillar, New York Life Insurance Company, Deloitte, the Carlyle Group, 3M, Duke Energy, Siemens, Verizon, IBM, and Allstate Insurance, among many others.

Appendix 7: Task Force Members

Other task force members represented such institutions as: Tufts University, Foreign Policy magazine, Standard Chartered Bank, the Business and Industry Advisory Committee to the OECD, Facebook, a former EU Ambassador to the US, a former senior VP of the World Bank, Deloitte Touche, and Susan Schwab, a former United States Trade Representative.

Appendix 8: Corporate Representatives on the PEC

Obama’s PEC includes CEOs and executives from Boeing, Xerox, Dow Chemical, UPS, Walt Disney Company, Warburg Pincus, Caesars Entertainment, Ford, Verizon, JPMorgan Chase, Ernst & Young, and Archer Daniels Midland, among others.

Appendix 9: Participants in New York Fed Conference

The program for the event was to include opening remarks from the president of the New York Fed, William Dudley, and would also include the EU’s ambassador to the United States, Joao Vale de Almdeida; the European Commission’s director-general for Economic and Financial Affairs, Marco Buti; and individuals from Columbia University, Johns Hopkins School of Advanced International Studies, MIT, the Brookings Institution, University of Cambridge, the EU-based think tank Bruegel, Morgan Stanley, European Banking Authority, former Federal Reserve Chairman Paul Volcker was chair of the panel on ‘Transatlantic Dimensions of Financial Reform,’ and with Olli Rehn, Vice President of the European Commission and Commissioner for Economic and Monetary Affairs (a central figure of the ‘austerity’ hierarchy) as the ‘keynote’ speaker.

 

Andrew Gavin Marshall is an independent researcher and writer based in Montreal, Canada. He is project manager of The People’s Book Project, and he hosts a weekly podcast, “Empire, Power, and People,” on BoilingFrogsPost.com.