Forwarded from Tom Kruse in Bolivia

Louis Proyect lnp3 at
Mon May 1 08:17:11 MDT 2000

Dear Friends:

Could you please post this your lists?  It would be greatly appreciated.




                   "BECHTEL SPEAKS, WE RESPOND"

                    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              rbechtel at

        Send a copy to: Bechtel Public Relations Division
                       globrep at

        Again, my response to Bechtel is included at the end of this note.
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
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
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
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
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
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SAN FRANCISCO: P.O. Box 22157 San Francisco, CA  94122
BOLIVIA: Casilla 5283, Cochabamba, Bolivia
FAX: (978) 383-1269
E-MAIL: info at

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
Fax:     (978)383-1269

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

Louis Proyect

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