Conspicuous consumption and destructive wealth The case of Ira Rennert

There is no question that excessive consumption damages the environment, but are consumers really driving the runaway train? I offer the following as an indication that different drivers are in charge.

By Ian Angus

If you want to start a campaign focusing on grossly conspicuous consumption as an environmental crime, then an appropriate poster boy would be Ira Rennert, currently the 144th richest man in the world. Forbes magazine pegs his net worth at US$5.3 Billion.

Just over ten years ago Rennert built (more accurately: had other people build for him) a new vacation home in the Hamptons, on Long Island, New York. There are many large summer homes in the area, but Rennert’s place, dubbed Fair Field, is believed to be the largest contemporary residence in America.

In addition to three swimming pools, a $150,000 hot tub, and a 164-seat movie theatre, it features:

25 bedrooms and as many full bathrooms, 11 sitting rooms, three dining rooms, and two libraries; a servants’ wing with 4 more bedrooms; a power plant big enough to run a large municipal high school or shopping mall; a 10,000-square-foot “playhouse” with two bowling alleys and tennis, squash, and basketball courts; and a multi-story, 17,000-square-foot garage capable of accommodating perhaps 100 cars. [1]

The total area of the buildings at Fair Field is over 100,000 square feet, but the main house alone, at 66,000 square feet, is almost twice as big as the White House and 40% larger than Bill Gates’ more famous home in Washington State.

Rennert travels in a private Gulfsteam 5 jet, perhaps to save time travelling to his other homes. He owns one of the most expensive private homes in Jerusalem, a palatial property he bought for a rumored $4 million in 1996 and then had completely renovated, including installing what are said to be the most advanced electrical, climate-control, and water-filtration systems in Israel. That’s in addition to his luxurious duplex apartment on Park Avenue in New York City, which is near the twin $30 million apartments he bought for his daughters as gifts. [2]

Obviously, no one is going to accuse Mr. Rennert of living a green lifestyle.

But where ecocide is concerned, Rennert the conspicuous consumer is a piker compared to Rennert the capitalist.

Rennert’s wealth comes from his 95% ownership of Renco Group, a private holding company whose principal subsidiaries are the only primary magnesium producer in the U.S., US Magnesium Corp. (MagCorp), and  the largest primary lead producer in the western world, Doe Run Resources Corporation.

In 1996 MagCorp was named the number one polluting industrial facility in the United States by the Environmental Protection Agency. As recently as April 2010, the EPA said that investigations on the company’s Utah site found “high levels of environmental contamination …. [including] arsenic, chromium, mercury, copper, and zinc; acidic waste water; chlorinated organics; polychlorinated biphenyls (PCBs); dioxins/furans, hexachlorobenzene (HCB); and polycyclic aromatic hydrocarbons (PAHs). These wastes are being released into the environment and are largely uncontrolled.” Waste-water ditches around MagCorp’s plant are reported to be contaminated with dioxin at levels as high as 170 parts per billion: EPA rules require immediate clean-up action at one part per billion. [3]

Doe Run has frequently been cited by the EPA for exceeding legal emission limits, as well as polluting roads and soils around its facilities in Herculaneum, Missouri. In February 2002, health officials in Missouri found that 56% of children living near the Doe Run smelter had high blood-lead levels. An October 2009 EPA report says that soil on one-third of properties situated within a mile of the company’s lead smelter contains lead at levels exceeding the legal threshold for mandatory removal and replacement. An EPA administrator said that Doe Run’s emission reduction efforts “clearly fall short of what was necessary.”[4]

Like many polluters in the Global North, Renco has in recent years shifted its focus to countries where there are fewer regulations, weak enforcement, and many poor people who desperately need jobs. In 1997 it bought a lead, silver, gold, copper and zinc operation in the Andean city of La Oroya, from the Peruvian government for $126 million: as part of the deal, Doe Run Peru was required to lend $126 million to Renco, interest free.

That money could have been used to live up to another part of the deal: Rennert promised to modernize the smelter and clean up the environment. An environmental study six years later found that concentrations of lead, sulfur dioxide and arsenic in the air had increased since the takeover: Renco still says it can’t afford the promised upgrades.

In March 2005, 99 percent of Oroyo children tested had blood lead levels vastly exceeding EPA and World Health Organization limits.

In 2007, the UK Guardian sent a prize-winning journalist Hugh O’Shaughnessy to La Oroya:

The quality of air sampled in the neighborhood by three Peruvian voluntary agencies showed 85 times more arsenic, 41 times more cadmium and 13 times more lead than is safe. In parts of the town the water supply contains 50 per cent more lead than levels recommended by the World Health Organization. The untreated waters of the Mantaro river are contaminated with copper, iron, manganese, lead and zinc and are not suitable for irrigation or consumption by animals, according to the standards supposed to be legally enforced in Peru. The water coming out of the nearby Huascacocha lake contains more than four times the legal limit of manganese.[5]

In August 2009 the Inter-American Commission on Human Rights agreed to hear a case that accuses Peru’s pro-business government of “violating the rights to life, personal integrity, and to information and access to justice, due to toxic pollution from Doe Run Peru’s multi-metal smelter in La Oroya, Peru.” [6]

The Blacksmith Institute and Green Cross Switzerland have identified La Oroya as one of the Ten Worst Polluted Places on Earth, a list that also includes Chernobyl. [7]

* * *

The case of Ira Rennert offers important lessons for anyone who wants to understand the causes of environmental destruction.

One is the cruel absurdity of using “per capita” averages to determine the impact that individuals have on the environment. None of the poison in Oroya, none of the lead dust in Missouri or the dioxins in Utah were caused by Peruvian or American working people, or by consumers anywhere. Ira Rennert and a handful of high-paid executives made all of the polluting decisions, and only they should be held responsible.

But a more important point is the distinction between consumption and power.

As an individual consumer, Rennert represents hyper-consumption at its worst. His way of living is a gross insult to the earth.

But as the owner of the Renco Group Inc., Rennert has shortened the lives of tens of thousands of people and laid waste to entire ecosystems.

As a consumer, Rennert lives an excessively wasteful life. As a capitalist, he has power over the way that other people live – and the way that they die.

That’s a fundamental difference that can’t be reduced to too many people consuming too much.

+++++++++++++++++++++++++++++++++++++++++++++

Ira Rennert’s summer home on Long Island:

was paid for by people who live in La Oroya, Peru:

and Herculaneum Missouri:

and Rowley, Utah:

+++++++++++++++++++

References

[1] Michael Shnayerson, “Sand Simeon.” Vanity Fair, August 1998.

[2] Emily Thornton. “Ira Rennert’s House of Debt.” BusinessWeek, February 17, 2003.
Peter Hellman. “Rennert Redux.” New York, December 14, 1998.

[3] EPA fact sheet, updated April 10, 2010.
Sterling D. Allan. “DOJ Files Civil Action Against MagCorp for PCB Violations.” Pure Energy Systems News, May 12, 2005

[4] Chad Garrison, “Doe Run Lead Smelter Continues to Contaminate Herculaneum.” Riverfront Times, October 27, 2009.

[5] Hugh O’Shaughnessy. “Poisoned city fights to save its children.” The Guardian, August 12, 2007

[6] Interamerican Association for Environmental Defense. News Release: “IACHR Will Examine Case Against Peru for Violating the Human Rights of Residents of La Oroya, A City Extensively Contaminated by the Doe Run Peru Smelter.” August 19, 2009.

[7] “Top 10 Most Polluted Places 2007.”

More on Rennert and Renco

Posted in Consumers, Featured, Latin America, Population

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paul
5 years 5 months ago

yes I agree completely with what you say, i’m just cautious of attacking the capitalist establishment head on and am trying to envisage a more subtle means of improvement. I think what you say about corrupt government is true but perhaps an understatement, im not even sure the gov.s are much more than a placebo. I still believe in democracy and that we (the people) have power, but more so in the shopping mall than the ballot box.

Selfish greed is the villain here in all of this and its this aspect of our society which is being outed, slowly but surely, on blogs and forums all over the world, particularly in light of the state of the environment. eg. oil was a wonder product until we realised it was destroying our world, now it serves to reveal what the greedy are prepared to do to protect their wealth. Im not sure capitalism would not work ok if selfish greed were illegal, or rather if it were illegal to exploit the earth and its citizens, if guided by other values alongside pursuit of profit. I wonder if it is the establishment of these values (alongside the exposure of destructive callous greed) which is the purpose of this movement.

David Patrick
5 years 5 months ago

While it is easy to see and say that Capitalism is killing us all, is is a lousy and unsupportable rallying cry. I encourage you to use these three words as your mantra;

end corporate rule!

Corporations will do whatever they are allowed to do in order to make profit, that is their reason for existing. What we have to gather around is the awareness that governments are ruled by corporations, not the other way around, because of basic and exploitable flaws in our party funding and lobbying rules.

Seek not to “end capitalism” for that is a futile and contentious pursuit. Spend your energies instead on demanding transparency, and personal accountability, that will shine the bright light of truth on our inherently corrupt governments.

END CORPORATE RULE!

5 years 5 months ago

Paul you are a fool. Capitalism is unrealistic, its killing every living thing on this planet so that men like Rennet can live absurd lifestyles.

You have no argument only a metaphor.

paul
5 years 5 months ago

I really would advise against suggesting anti-capitalism as the only route to sustainability. Its not realistic and will turn too many off. besides I believe in a ‘third way. Capitalism is arguably the natural mode of human societal organisation and parallels natural processes often, we could say it has now only reached adolescence and must negotiate a period of difficult growing pains and self conciousness before becoming an adult with responsibilities. The selfish, juvenile capitalism has served its purpose and as always human society must progress, change and adapt. It will be painfull but markets must be realigned to reflect a full range of human values. Values are the key to all this and capitalism has sold off humanity to buy toys. Its time to grow up. In the capitalist society of the future Ira Rennet would be considered a criminal.

Jeff White
5 years 6 months ago

Cory wrote: “Bottom line – a person in Canada or the U.S. produces approx. 20 times the carbon than (sic) an average person in a vulnerable, developing country such as Zimbabwe.”

What does this mean? How does comparing average, per-capita carbon consumption between countries provide any insight into the causes of the ecological crisis or how to resolve it?

Are we supposed to conclude that Canadians as individuals are carbon gluttons, and that we have to reduce our individual carbon consumption by a factor of ten or more? Sorry, but that does not follow. Most of that per capita carbon production is not something I, as a Canadian, can control personally, by changing my consumption patterns; it’s rather a statistical abstraction created by allocating to me my per capita “share” of the country’s total production of carbon emissions.

My share of the Athabasca Tar Sands. My share of the forest industry. My share of the automobile industry. My share of the food processing, packaging, and storage industries. My share of the mining and smelting of ores. My share of factory farming operations. My share of the aviation and ground transportation industries. My share of the armed forces. Most of my “share” has nothing to do with my own personal consumption and emission of carbon.

What’s relevant to consider is not what emissions the “average person” produces, but what emissions are produced by technologies and practices that operate in conflict with the environment, and not in harmony with it – technologies that are aimed at increasing the profits and wealth of the small minority at the expense of the planet and the rest of us who live on it. Those technologies and practices are what keep the capitalist system going. We have more of those technologies and practices here in Canada than does Zimbabwe. That’s the source of the “staggering inequality” of carbon emissions; because under capitalism, growth and development inevitably mean environmental destruction.

We will never get rid of destructive technologies and industrial practices without also ridding ourselves of capitalism and replacing it with a new form of society – one based on freely-associated labour and democratic control of the means of production. Only when production is freed from the necessity of turning a profit can we begin to bring economy into line with ecology.

It’s not up to the “globally wealthy” like Ira Rennert to change the system. They will never do it. It’s up to the rest of us.

5 years 10 months ago

The Staggering Inequality of Climate Change

Globally, the wealthiest 8% emit 50% of all emissions.

And most of this is for a display of opulence and over consumption. Professor Stephen Pacala of Princeton University calculated the emissions per person based on 6.5 billion people. What he found is startling. He found that the 3 billion poorest people emit essentially nothing. Simply stated, the development of the desperately poor is not in conflict with solving the climate crisis. Ironically, the reluctance of developing countries to drastically cut carbon is often used as an excuse by developed nations to do nothing. For example, Zimbabwe emits 0.93 tonnes of carbon per person, while the United States emit 19.66 tonnes of carbon per person. Canada emits 17.86 tonnes of carbon per person. India produces 1.17 tonnes of carbon per person while China produces 3.7 tonnes of carbon per person. Bottom line – a person in Canada or the U.S. produces approx. 20 times the carbon than an average person in a vulnerable, developing country such as Zimbabwe.

The wealthiest 15% emit 75% of all emissions

Furthermore, Pacala’s data shows that the wealthiest 15% are responsible for 75% of global emissions.

“In contrast, the rich are really spectacular emitters. …the top 500 million people [7.5% of humanity] emit half the greenhouse emissions. These people are really rich by global standards. Every single one of them earns more than the average American and they also occur in all the countries of the world. There are Chinese and Americans and Europeans and Japanese and Indians all in this group.”

The remaining 85% of humanity emit only 25% of all emissions

Pacala’s data shows the globally wealthy could solve the crisis. Most importantly, it also shows there is absolutely no other way. Humanity must cut fossil fuel emissions massively and the only people who can cut global fossil fuel use to the extent needed are the wealthiest 15%. Furthermore, most of the cuts will need to be made by the wealthiest 7.5%, because they are using almost all of it. The globally wealthy must make the major reductions.

From:
Suicidal Tendencies or Addiction? Earth Day Hijacked by Climate Wealth Opportunists
http://canadianclimateaction.wordpress.com/2010/03/31/suicidal-tendencies-or-addiction/

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