Editorial

Another Tricky Dick

Having simmered on the back burner through the aftermath of 9/11, Congress’s effort to obtain records from Vice President Dick Cheney’s energy task force has now reached a boiling point. The Enron collapse has only made Cheney dig in his heels even harder, such that the whole country is now wondering just what Ken Lay asked for–that is, recommended–at those meetings, and what Cheney delivered. But is it Enron’s dealings with the task force Cheney is trying to hide, or Halliburton’s? The huge Dallas-based oilfield services conglomerate, for which Cheney served as CEO from 1995 to July of 2000, may yet become Cheney’s own poison pretzel.

Cheney joined Halliburton just two-and-one-half years after leaving his post as Secretary of Defense under Bush I. Halliburton, principally through its construction subsidiary, Brown & Root, had already begun reaping the gains from privatization initiatives pushed by Cheney during the Gulf War. As Robert Bryce reported in The Texas Observer, in 1992 the Pentagon paid Brown & Root for a study of how private companies could better be used to provide logistics support for U.S. troops across the globe. Later that year the company won such a contract from the U.S. Army Corps of Engineers. But the money didn’t really start rolling until Cheney joined Halliburton in 1995. At that time, Brown&Root was bringing in less than $350 million per year in Defense Department contracts, according to The Baltimore Sun. By 1999, after four years with Cheney at the helm, that number had grown to more than $650 million. When Cheney left to join the Bush ticket in July of 2000, Halliburton execs made sure he would stay their man with an eye-popping “retirement package” worth more than $33 million. It paid off. Last December, the Pentagon awarded Halliburton a huge, nine-year contract to build operating bases for troops deployed overseas. The cost-plus, no-cap award does not have an estimated value, but according to a report by the Institute for Southern Studies, Halliburton reported revenues of $2.5 billion on similar contracts in the 1990s.

We don’t yet know if Halliburton’s cozy relationship earned the company an audience with Cheney’s energy task force, but we can take a pretty good guess at what they hope to get from their former CEO. Although there have been no accusations of Enronesque machinations, Halliburton is not without its own troubles. Dresser Industries, a Halliburton subsidiary acquired while Cheney was CEO, is facing enormous exposure to asbestos litigation, so much so that Dresser dragged Halliburton’s stock down more than 70 percent in the last year. (Cheney himself got out while the getting was still good, selling his stock and options in the summer of 2000 for more than $20 million.) Then, in mid-January, Halliburton’s stock rebounded dramatically, apparently on speculation that the White House would announce some kind of relief plan for asbestos defendants. That has yet to happen, and former Senator John Ashcroft’s asbestos industry bill, killed by Congress last year, remains deader than Mel Carnahan. But a more generic “tort reform” initiative would not be uncharacteristic of Bush, who made restricting access to the courts a centerpiece of his tenure as Texas governor.

On the energy side, Halliburton execs may have wanted to discuss U.S. sanctions policy with the vice president. It’s a sensitive topic for Cheney. While overseeing the Department of Defense, he helped enforce sanctions regimes against first Libya and then Iraq. Later, at Halliburton, he developed a more nuanced view of American foreign policy, and the company earned millions on contracts in both countries. Cheney argued in a 1998 speech that the U.S. had become “sanctions happy,” and that it was “very hard to find specific examples where [sanctions] actually achieve a policy objective.” That same year, Robert Bryce reported, Cheney lobbied Congress for an exemption to the Iran Libya Sanctions Act. In 1995, Brown & Root was fined $3.8 million, according to The Baltimore Sun, for using a foreign subsidiary to violate the Libya sanctions. The Financial Times of London has documented similar deals with Iraq, where Halliburton’s oilfield services contracts–obtained through foreign subsidiaries–have made them the single biggest U.S. contractor operating in Iraq (point I on Bush’s Axis of Evil) since the sanctions began. –NB

You May Also Like:

Published at 12:00 am CST
Top