Fwd: Please Post

Doug Henwood dhenwood at panix.com
Sun Apr 30 10:51:46 PDT 2000

[From Tom Kruse <tkruse at albatros.cnb.net>, with formatting cleaned up a bit.]



Volume 33 - April 29, 2000

Dear Readers:

Apparently the e-mail messages that many of you have sent in the past weeks to Mr. Riley Bechtel, regarding his corporation's role in the Cochabamba water uprisings, have gotten his attention. On Tuesday I received a lengthy public response from Mr. Didier Quint, the head of Mr. Bechtel's subsidiary that oversaw the corporation's fiasco here in Bolivia. I know that many of you have received the same letter. Bechtel's subsidiary also submitted a shorter version as a letter (accusing me of "misconceptions") to the San Francisco Examiner, in rebuttal to my article published there and in the Toronto Star.

Today I am releasing my response, included in full below. Those of you who know my work well know that I do not take accuracy lightly. My reports from Cochabamba this past month have been based on my personal eyewitness accounts and extensive interviewing from the center of action, on occasion at personal risk. I stand by each one. In contrast, Bechtel's response was written from the quiet of far off London and is riddled with numerous, profound, and documentable misstatements of fact.

I hope those of you interested will read my response closely. As the letter points out, Bechtel, in addition to all of the other damage it has contributed to in Cochabamba, is now demanding a $12 million compensation payment in exchange for leaving. I think that is intolerable. If you are interested in sharing your own opinion about that demand or any other aspect of the matter, I encourage you to do so directly via e-mail to:

Mr. Didier Quint Mr. Riley Bechtel

dplquint at iwltd.com rbechtel at bechtel.com

Send a copy to: Bechtel Public Relations Division

globrep at bechtel.com

Again, my response to Bechtel is included at the end of this note. Copies of Mr. Deider's letter to me and to the Examiner (along with as my original article) have been posted by Bechtel on its corporate Web site at:


Thank you for your ongoing interest and support.

Jim Shultz The Democracy Center


April, 29, 2000

Mr. Didier Quint Mr. Riley Bechtel Managing Director Chairman and CEO International Water LLC Bechtel Enterprises

(via e-mail)

Dear Mr. Quint and Mr. Bechtel:

This letter is in response to Mr. Quint's April 25th e-mail to me and his letter to the San Francisco Examiner, regarding the civil uprising over water prices in Cochabamba. While I appreciate your effort to share your views on this matter, it is disappointing to see the extent of your misunderstanding of the basic facts and your unwillingness to accept any responsibility for your actions here.
>From your offices in London and San Francisco I am sure you had to
rely on your companies' local representatives for information. It is clear they have briefed you very, very poorly.

To be clear, most everyone in Cochabamba would agree with your assessment about the need for more and better water. Cochabambinos are anxious to solve their water problems and many once had high hopes that your company would help to do this. You are also not alone in your questioning of the Misicuni dam project. Your account of your secret negotiations with the Bolivian government provides much more detail then had been available publicly and I have shared it with civic leaders and journalists here.

Most importantly, your account confirms what water rights leaders here have been saying for months - that the contract agreed to by the government was a failure from the start, a virtual guarantee that thousands of poor families would be hit with water rates they could ill afford. But let's be clear on one other point. While you complain bitterly about that contract, you are just as much a party to it as the Bolivian government. You negotiated it, you signed it, and you implemented it, knowing well the injustices and social eruptions it would cause. You did not enter into that contract as an act of public spirit. You saw an opportunity to make a profit here and you took it. One additional point you left out of your summary - your companies also demanded and won a provision in that same contract guaranteeing you, come hell or high water, an average 16% annual return on your investment (contract annex #5), leaving Bolivia's poor to bear all the financial risk.

That said, let me now address your profound misstatements of fact about the public protests and your water price hikes that triggered them:

1) You state, "Several wealthy interests paid poor people - many bussed in from outside the area – to demonstrate against the concession." Apparently your local representatives failed to inform you that, during the seven days of protests here in early April, protesters blockaded all highways in and out of Cochabamba. There was no bus service, commercial or otherwise, or any other ground transportation entering or leaving the city. Not even bicycles were allowed through without having their tires flattened. If you have any doubt about my account you should consult with the Bolivian government, which specifically cited the blockades as a reason for its declaration of a "state of emergency" on April 8. Before you make this claim again I suggest your provide your proof. I spoke personally with many who came here from the rural communities, on foot from as far as 40 miles. No mysterious unnamed interests paid them to do so. They came to reclaim control of their water.

2) You state: "The Coordinadora [the civic alliance that led the protests] was mostly composed of people and organizations having an interest in the parallel water market or being part of the most affluent sector of the population." The Coordinadora's affluence will certainly be news to its members. The coalition is led by the union that represents minimum wage factory workers. Its members also include organizations of peasant farmers, environmentalists, youth, and others. Could you explain which of these groups you count as affluent?

3) You state, "Opposition to the proposed new water law also came from coca leaf growers who, the state asserted, were supported by their cocaine connection." It seems hypocritically convenient that you would so blatantly criticize the Bolivian government on the one hand and yet so readily parrot their false political spin on the other. I have shared your charge in the past few days with many people here who participated in the protest and I think the best response comes from Franz Pedrazas, a local taxi driver. You raised his water rates last January from $10 per month to $20, an increase equal to more than what he earns in a day driving a cab for 12 hours. Regarding your charge that nacrotraffickers were behind the protests he says, "It's a big lie. I'm not a narcotrafficker. If I were why I would I be driving a cab? The farmers aren't narcotraffickers either."

4) Finally, you state: "The typical rates for water and sewage services rose 35%. Low income residents were to pay 10% more and the largest hikes (106%) were reserved for the highest volume users, the most affluent." After four months I am still looking, with no success, for someone here who had a rate hike of just 10%. I have interviewed dozens and dozens of families about their rate hikes. Even among the poor, rate increases of at least 100% were the most common and many people suffered increases much higher. Your claim will be big news to Mr. Pedrazas, the cab driver, to Tanya Paredes, a mother of five who knits baby clothes for a living (her increase was 300%), and thousands of others. If you don't wish to believe my account I would gladly send you copies of the local newspaper investigations that also confirm the extremity of your rate hikes.

As a parent, one of the lessons I have tried to teach my children is the importance of telling the truth and of accepting responsibility, rules that should apply as well to large corporations. The people of Cochabamba have suffered four months of upheaval because of your conduct here. A 17 year old boy is dead. Two youths are blinded. More than 100 are injured. Those who opposed you had their homes ransacked in the dark of night and were flown off to a remote jail in the jungle in an effort to silence them. In your defense you rely on lies and seek to blame everyone from peasants to well-drillers. Whatever credibility you had left has only been tarnished all the more.

I tried, as did many other journalists here, to reach your local representative, Mr. Geoffrey Thorpe, for comment during the uprisings. Neither my calls nor anyone else's were returned. In fact, on several occasions, he hung up on those few reporters who managed to reach him. You may also find it of interest that, while the people of Cochabamba were having their blood spilled on the streets, your subordinates were busy taking away the water company's computers and financial and personnel records. Your subordinates also left behind bank accounts that were empty and more than $150,000 in unpaid bills. On top of all this suffering and damage you now have the audacity to demand a compensation payment of $12 million from the Bolivian people.

I am afraid that the misconceptions in this matter are not mine, but yours. Despite your apparent views to the contrary, the people of Cochabamba are not stupid, nor are they misled. It may not be the public relations message you would like to project, but the facts speak for themselves: You came here to make a profit, agreeing to a contract that insured water rates far beyond what people could afford. You implemented those rates, provoking exactly the social eruption you anticipated. Even as people here died demanding that you leave you refused to go and hid behind the violent repression provided for you by your partners in the Bolivian government.

I assume your letter was intended to make you and your actions sound reasonable to a public audience. If you actually want to have your behavior be reasonable I encourage you to stop spinning misinformation, return what you have taken, reconcile your unpaid bills, and withdraw your demands for $12 million from those so ill-able to afford it. I will share this response publicly, as you have your letter to me.


Jim Shultz

Executive Director

The Democracy Center

Cochabamba, Bolivia


THE DEMOCRACY CENTER ON-LINE is an electronic publication of The Democracy Center, distributed on an occasional basis to more than 1500 nonprofit organizations, policy makers, journalists and others, throughout the US and worldwide. Please consider forwarding it along to those who might be interested. People can request to be added to the distribution list by sending an e-mail note to "info at democracyctr.org".

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SAN FRANCISCO: P.O. Box 22157 San Francisco, CA 94122

(415)564-4767 BOLIVIA: Casilla 5283, Cochabamba, Bolivia FAX: (978) 383-1269 WEB: http://www.democracyctr.org E-MAIL: info at democracyctr.org

Jim Shultz Executive Director The Democracy Center

Bolivia: Casilla 5283 Cochabamba, Bolivia US: P.O. Box 22157, San Francisco, CA 94122 (415)564-4767 E-Mail: JShultz at democracyctr.org Web: http://www.democracyctr.org Fax: (978)383-1269

Tom Kruse Casilla 5812 / Cochabamba, Bolivia TelFax: (591-4) 248242, 500849 TelCel: 017-22253 Email: tkruse at albatros.cnb.net

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