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The Catastrophic of Cost Corruption: The Taranto Scandal

Corruption Can Kill

The social cost of corruption can be enormous, as the Italian region of Puglia may be about to discover.  The possible closure of a steelworks in Taranto which I wrote about recently may prove to be a catastrophe for the area’s local economy and put tens of thousands out of work, all because rules and regualtions were ignored, flouted or, maybe, because bribes were paid to officials to ensure they turned a blind eye.

Eventually though, the Taranto steelworks problem grew so enormous and so life-threatening, Italian magistrates decided drastic action needed to be taken.  This action involves closing a section of the steelworks in Taranto which is responsible, according to official reports, for extremely noxious emissions.

Officially, around 400 people have died as a direct result of the poisonous pollutants the steelworks has belched out over its employees and residents living in the area around the plant.  A report into the health situation in the area suggests that as many as 11,500 people may have died from the effects of the emissions of the plant.  The number could be much higher than 11,500 seeing as the plant has been operating for a lot longer than the seven year period the report examined.

Dangers Quietly, and Irresponsibly, Ignored

For many years, the dangers were quietly, and irresponsibly, ignored.  Officials and local politicians kept quiet, and the owners of the pollution-belching steelworks did nothing, or very little, to tackle the problem, perhaps because they were safe in the knowledge that they had paid everyone with any influence to keep quiet.  Investigators are trying to establish just why the plant was allowed to continue polluting the local environment for so long.

Corruption Can Kill

Unscrupulous Owners?

The owners, who must be pretty unscrupulous people, left remedial action until it was far too late but, and probably to their great surprise, have been finally found out.  As a result, the livelihoods of many thousands of innocent workers are at stake.

If the owners had acted sooner, or, more to the point, if they had been ordered to do something sooner, then all those jobs would not be at risk.  The closure of the plant would be an economic catastrophe for the area, but it could have been avoided if certain people had acted more responsibly.  Instead, well lubricated hands pushed the problem under the carpet, year after year after year.

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It will cost something like €350 million to render the ILVA steelworks safe, but the huge sum of money may not be forthcoming.  If only the owners had spent the same amount of cash they probably spent bribing people to keep quiet on carrying out the much needed alterations.  But short-sightedly, they did not.  It was not only the owners who were short-sighted, but all the officials in the area who turned a blind eye to the ever increasing chorus of complaints from residents over the mysterious red dust which rained down.  The locals could possibly point accusatory fingers at Italy’s regional and national government too.

The History of the Taranto Steelworks

Actually, accusatory should be pointed at central government because what is now ILVA was once run by the Italian state.  The steelworks in Taranto was created by a group of industrialists who formed a company called IRI.  The IRI then passed into the hands of Italy’s state becoming in the 1970s one of the largest state run companies in Italy.  As a result of the steel crisis in the 1980, IRI found itself, after several complex steps, back in private hands.  Concerns over the levels of pollution began long before ILVA came into existence in the 1990s.

I was told by an occupational health physician who visited the ILVA plant in Taranto as part of his training that although inspections were carried out periodically, the plant was generally tipped off beforehand.  This meant that during inspections certain plant and machinery, such as the coke making furnaces, were not active, as a result, atmospheric pollution levels appeared normal.  Once the inspectors left the site, coke producing plant was switched back on.  Workers on site, I was also informed, often did not wear protection whilst dealing with noxious substances.  It sounds as if health and safety regulations were generally ignored at the site.

While it could be argued that the current owners are not entirely to blame for the plant’s noxious emissions, one would have expected them to have carried out something known as ‘due diligence’ before taking over the running of the facility.  It is hard to believe that the present owners were unaware of the dangerous condition of the steelworks before they took it over.

The Representatives of the People who Didn’t

The elected representatives of the people, both local and national, did not do a great job of protecting the health of their voters, now did they?  Nor did the people’s representatives consider the consequences of such a major employer being shut down – the steelworks employs around 12,000 people directly and as many as 80,000 more are thought to depend on the facility for work indirectly.  The ILVA complex produces 30% of Italy’s steel, and generates nearly 60% of the area’s GDP.

Hopefully, the Taranto situation will help Italy understand why corruption is so dangerous.  Not only is corruption dishonest, it can kill, both people and many thousands of jobs.

I pity the poor ILVA plant workers, I really do.

Wake up Italy.  Corruption can be downright lethal, literally and economically.

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