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Wednesday, December 03, 2003  

The Halliburton Connection

This is a well-documented connection, and since the Iraq invasion, perhaps the most pernicious in the Bush White House. One of the best pieces on this connection was a piece done by 60 Minutes in April 2003. The entire transcript of the show is here. Below are the most salient features of this mutually-beneficial relationship.

Cheney's Cozy Relationship with Halliburton

[Charles] Lewis [executive director of the Center For Public Integrity] says the trend towards privatizing the military began during the first Bush administration when Dick Cheney was secretary of defense. In 1992, the Pentagon, under Cheney, commissioned the Halliburton subsidiary Brown & Root to do a classified study on whether it was a good idea to have private contractors do more of the military's work.

“Of course, they said it's a terrific idea, and over the next eight years, Kellogg, Brown & Root and another company got 2,700 contracts worth billions of dollars,” says Lewis.

“So they helped to design the architecture for privatizing a lot of what happens today in the Pentagon when we have military engagements. And two years later, when he leaves the department of defense, Cheney is CEO of Halliburton. Thank you very much. It's a nice arrangement for all concerned.”

During the five years that Cheney was at Halliburton, the company nearly doubled the value of its federal contracts, and the vice president became a very rich man....

Even before the first shots were fired in Iraq, the Pentagon had secretly awarded Halliburton subsidiary Kellogg, Brown & Root a two-year, no-bid contract to put out oil well fires and to handle other unspecified duties involving war damage to the country’s petroleum industry. It is worth up to $7 billion.

Under normal circumstances, the Army Corps of Engineers would have been required to put the oil fire contract out for competitive bidding. But in times of emergency, when national security is involved, the government is allowed to bypass normal procedures and award contracts to a single company, without competition.

How the contracting works

Defense Policy Board
Lewis says the best example of these cozy relationships is the defense policy board, a group of high-powered civilians who advise the secretary of defense on major policy issues - like whether or not to invade Iraq. Its 30 members are a Who's Who of former senior government and military officials.

There’s nothing wrong with that, but as the Center For Public Integrity recently discovered, nine of them have ties to corporations and private companies that have won more than $76 billion in defense contracts. And that's just in the last two years.

“This is not about the revolving door, people going in and out,” says Lewis. “There is no door. There's no wall. I can't tell where one stops and the other starts. I'm dead serious.”

“They have classified clearances, they go to classified meetings and they're with companies getting billions of dollars in classified contracts. And their disclosures about their activities are classified. Well, isn't that what they did when they were inside the government? What's the difference, except they're in the private sector.”

Richard Perle resigned as chairman of the defense policy board last month after it was disclosed that he had financial ties to several companies doing business with the Pentagon.

But Perle still sits on the board, along with former CIA director James Woolsey, who works for the consulting firm of Booz, Allen, Hamilton. The firm did nearly $700 million dollars in business with the Pentagon last year.

Another board member, retired four-star general Jack Sheehan, is now a senior vice president at the Bechtel corporation, which just won a $680 million contract to rebuild the infrastructure in Iraq.

That contract was awarded by the State Department, which used to be run by George Schultz, who sits on Bechtel's board of directors.

“I'm not saying that it's illegal. These guys wrote the laws. They set up the system for themselves. Of course it's legal,” says Lewis.

More on Cheney's Halliburton connections are at the Center for Public Integrity, which Lewis directs.

But at least Halliburton is keeping America safe, right?
Well, no. Despite publicly denouncing the "evil" regime of Saddam Hussein, Halliburton was as recently as the late 90s selling goods and services to Saddam (in contravention of US sanctions). And he wasn't the only baddie paying Dick's paycheck.

Libyan dictator and suspected anti-U.S. terrorist Moammar Gadhafi engaged a foreign subsidiary of Halliburton company Brown & Root to perform millions of dollars worth of work. According to the Baltimore Sun, Brown & Root was fined $3.8 million for violating Libyan sanctions. (Although Cheney wasn't leading Halliburton when these sales started, subsidiaries' sales to Libya continued throughout his tenure.)

Burma (.pdf)
In Burma, Halliburton joined oil companies in working on two notorious gas pipelines, the Yadana and Yetagun. According to an Earth Rights report, "From 1992 until the present, thousands of villagers in Burma were forced to work in support of these pipelines and related infrastructure, lost their homes due to forced relocation, and were raped, tortured and killed by soldiers hired by the companies as security guards for the pipelines. One of Halliburton’s projects was undertaken during Dick Cheney’s tenure as CEO."

And of course, Iraq
Cheney claimed that he supported the U.S. sanctions on Iraq, but the Financial Times of London reported that through foreign subsidiaries and affiliates, Halliburton became the biggest oil contractor for Iraq, selling more than $73 million in goods and services to Saddam Hussein's regime.

posted by Jeff | 7:59 AM |
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