A Stake through the Heart of Three Gorges:

At the end of May, one of the longest and most bitterly fought environmental duels in the world came to an apparent end. Of course it's always possible that there will be yet another return from the dead, but for now it looks as though the 20-year effort to put a dam across the Yangtze River in central China has been killed by the U.S. Export-Import Bank, under enormous pressure from green groups, human rights advocates and, oddly enough, Jesse Helms-type conservatives looking to zero out all foreign aid.

This is a big victory that will not only save 1.3 million Chinese from forcible relocation by their fascist leaders, protect the Three Gorges from inundation and dozens of endangered species such as the Yangtze River dolphin from extinction, but also may salvage the fragile Chinese economy, which otherwise would have had to pay an estimated $70 billion for the Pharaonic madness sanctioned by Chinese overlord Li Peng. The defeat of the Three Gorges project may also mean an end to kindred plans for monster dams now on the drawing boards for Laos, Malaysia, Brazil, and in the headwaters of the Mekong in Hunan province.

Three Gorges is the world's largest construction project. The dam was planned to be 1.5 miles wide and 600 feet tall, creating a 450-mile long, heavily contaminated inland sea. Already more than 50,000 Chinese peasants have been driven from their homes. The project was to be 20 years in the building and looked to be a financial bonanza for global consortium of transnational corporations, including numerous U.S. firms such as Caterpillar, Harza Engineering, Rotec Industries (all based in Illinois), and Voigt Hydro of Pennsylvania.

Initially the Three Gorges hydro project was a lovechild of Chinese leaders and the World Bank, which has historically been the underwriter of mad schemes. Much of the early planning for the dam was by that scourge of the Third World, the Bechtel Corporation. But in the late 1980s the Chinese government, the World Bankers, and Bechtel encountered fierce resistance from a quarter where they least expected it: China. Three Gorges became something of a touchstone for the growing democracy movement inside China. Led by human rights advocate Dai Ching, a former rocket scientist and member of the Chinese secret service, the new Chinese environmental movement assailed the project on social, economic, and ecological grounds. Three Gorges was put on hold in 1988.

Then came Tiananmen Square. Dai Ching was there attempting to mediate a solution between the government and the protesters. Ching was also there to raise the issue of Three Gorges to the international press. "I am not against the government," she said. "I'm against the dam." The qualification did her no good. She was arrested, imprisoned, and sentenced to be executed. Copies of Ching's book, Yangtze, Yangtze, were seized and burned. When she was finally released from prison after a worldwide outcry, she was forbidden to write or speak publicly about the dam.

After Tiananmen, Three Gorges was resurrected by Deng Xiaopeng's henchman Li Peng, a former engineer. Peng, the Woody Guthrie of Chinese dictators, became so entranced with the grandeur of the Three Gorges dam that he began writing folk songs about it and compelled school children across the country to sing them.

But Dai Ching and the other Chinese environmentalists and human rights advocates had succeeded in revealing the awful truth about the Three Gorges project to the media and international environmental leaders. Bechtel, ever cautious about being exposed to public scrutiny, was the first to walk away. Then the World Bank--already beleaguered amid heavily criticized dam projects in India and Brazil--told the Chinese government that it would not loan money for the project until construction was well under way. It then became vital for the pro-dam forces to win Ex-Im Bank approval, so that Caterpillar and the other corporations involved in the project would have their vast investments and profits guaranteed by the U.S. taxpayer.

The Ex-Im Bank is little more than a welfare agency for U.S. companies doing business overseas. Every year the bank uses the U.S. treasury to back up billions in loans and service contracts for American corporations. Most of this is done with no public input and little outside scrutiny. In 1994 alone, the Ex-Im Bank had placed nearly $100 billion of U.S. taxpayer money at risk on environmentally destructive projects in the Third World. The bank currently has underwritten American companies doing business in China to the tune of $10 billion.

After a prolonged internal review, even the Bush administration refused to endorse Three Gorges, prompting the Ex-Im Bank--nominally an independent agency--to ignore pleas for help from the Chinese hydro lobby. Then, in 1993 a last-minute savior of the project arrived in the person of the late Secretary of Commerce, Ron Brown.

Flushed with triumph after a trip to China at the head of his traditional posse of corporate chieftains, Brown came to Washington and goosed federal water czars at the Bureau of Reclamation to get involved in the Three Gorges project. This was a smart move. It enlisted the eager bureaucratic support of the Bureau of Reclamation, which some elements of the Clinton administration had wanted to close down. The Bureau duly turned in many studies showing that the Three Gorges dam was as wise and beneficial a scheme as Glen Canyon or Hoover. Meanwhile Brown rallied the Illinois congressional delegation, including Senator Carol Moseley-Braun and former Rep. Dan Rostenkowski, to push hard for a reversal of the Ex-Im Bank position of the Bush years.

First blood was drawn by Defenders of Wildlife and the Monitor consortium of environmental groups, which sued the Clinton administration for allowing the Bureau of Reclamation to participate in a scheme that would imperil endangered species such as the panda, the Yangtze River dolphin, Temminick's cat, the stump-tailed macaque, and the South China siku deer. Rather than see the U.S. Supreme Court issue a ruling that might apply the Endangered Species Act to U.S.-funded projects abroad, and thus provide legal standing to dozens of other cases, the Clinton crowd pushed the Bureau of Reclamation into retreat. The Bureau of Reclamation took a walk, just as the World Bank had.

At this point, International Rivers Network, a group based in Berkeley, embarked on a direct anti-corporate campaign, denouncing Caterpillar and the other big corporations as welfare gougers, embarking on vast and destructive ventures only if they got taxpayers to guarantee their takings.

International Rivers Network staffers Juliette Majot and Owen Lammers devised an intelligent war plan. In the past, the Ex-Im Bank had no criteria for issuing loan guarantees other than the "creditworthiness" of the host government for any given project. (The creditworthiness of the country was duly assisted by the World Bank, in an unending shell game.) But the Rivers Network began pressuring the Ex-Im Bank to develop guidelines which addressed human rights and environmental concerns. It was these guidelines, adopted in 1995, that finally caused the Ex-Im Bank to issue an extraordinary eight-page rebuke to the U.S. corporations seeking the guarantees.

The fury of these corporations at being outed as welfare chisellers was expressed in the form of an assault on the Network in Forbes magazine two weeks before the Ex-Im Bank issued its verdict. The article was clearly designed to undercut the River Network's campaign against Three Gorges and other destructive projects in the Third World. Forbes writer Brigid McMenamin denounced the Rivers Network's "enviro-imperialism" and remarked angrily that the Ex-Im Bank and the World Bank have both "given a bunch of flaky radicals a say in [their] projects."

The best chance for Three Gorges dam probably expired back in April when Ron Brown's plane slammed into that hillside in Croatia. Sitting near Brown on that mission to reap corporate profits from war-torn Bosnia was John Scoville, president of Harza Engineering, a secretive Chicago-based firm that stood to make hundreds of millions advising the Chinese on the Three Gorges project.

Now China is down to one supporter of last resort: Canada. The Canadian consortium that planned the now largely doomed HydroQuebec project has time, equipment, and money on its hands. A decision from the Canadian export banking authority is expected within the next year.

Meanwhile, the International Rivers Network's successful campaign points toward the sort of militant new environmentalism embodied in groups such as Food and Water (based in Vermont) and the Environmental Research Foundation (publishers of the indispensable Rachel's Environment and Health Weekly). The strategy of these groups is to shun the sort of deal-making and underwriting that has largely corrupted the national green groups and go right for the corporate throat.

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