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Via Workers World News Service Reprinted from the Aug. 22, 2002 issue of Workers World newspaper ------------------------- DICK CHENEY:
WAR CRIMINAL, CORPORATE THIEF
By Richard Becker
San Francisco At an early-morning Aug. 7 demonstration here,
protesters
chanted, "Dick Cheney, war criminal--Dick Cheney, corporate criminal." They were right on both counts. Cheney was indicted and convicted by an independent
International War Crimes Tribunal for his role in directing the slaughter known as the Gulf War in 1991. As Secretary of "Defense" in the first Bush
administration,
Cheney played a key part in planning and executing the attack on Iraq. The battle plan included intentionally destroying Iraq's water, electrical, sewage, transport and food systems in violation of international law. Most of Iraq's civilian infrastructure was
destroyed in the
1991 war, which was preceded and followed by a total economic blockade of the country. The sanctions, imposed by the United Nations Security Council and enforced by the U.S. military, have killed more than a million Iraqis. Before he was appointed to head up the Pentagon,
Cheney
represented the oil and mining interests of Wyoming in Congress for several terms. In the House of Representatives, Cheney was an extreme right-winger, known for his racist, sexist, anti-gay, anti-union and pro-military positions. Today, to no one's surprise, Vice President Cheney
is
leading the charge for a new all-out war against Iraq. Who stands to benefit most from such a war? Big Oil and the military-industrial complex--powerful interests which find a near-perfect melding in the person of Cheney himself. THE REVOLVING DOOR
The shuttling of generals, admirals and other
officials
between the Pentagon and the big military contractors is so commonplace that it has its own title: the "revolving door." Military brass and civilian officials regularly use their influence to award lucrative sweetheart contracts, often amounting to hundreds of millions or billions of dollars, to favored corporations. Then, when they retire from government
"service"--usually
with lavish pensions and benefits--these same officials hire on with the same big contractors. Cheney's career is an excellent example of this
process,
which is as routine as it is corrupt. Beginning in 1992, Cheney's last year as secretary
of
defense, the Pentagon awarded a contract to Brown & Root, a subsidiary of Halliburton Corp., for $1.2 billion to provide "rapid troop support" mainly in the Balkans. An extension of the contract from 1999 to 2004 is projected to cost at least $1.8 billion. Pratap Chatterjee of CorpWatch described the 1992
contracts
as part of "a new scheme to privatize operations of the U.S. military that were drawn up by Halliburton itself under contract to Cheney in 1992." (CorpWatch, May 2) In 1995, two years after he left office,
Halliburton hired
Cheney as its new chief executive officer. Halliburton is the world's biggest oil services
company. It
ranks 71st among the Fortune 500 biggest corporations. It has oil drilling and maintenance operations all over the world, including Angola, Algeria, Brazil, Nigeria, Bangladesh, Russia, Central Asia and the Middle East. Halliburton acquired Brown & Root, one of the
biggest
military construction companies, in the early 1960s, and later another big construction firm, Kellogg. Brown & Root profited immensely in Vietnam, building landing strips, roads, military bases and other infrastructure for the U.S. war. Kellogg, Brown & Root (KBR) is today the unit
of Halliburton
that executes most of its military contracts. With Cheney's connections, KBR nearly doubled its
military
contracts--to $2.3 billion in his five-year tenure as CEO. Cheney appointed his former Pentagon chief of staff, David Gribbin, as Halliburton's lead lobbyist in Washington. In 1999-2000, the company received $1.5 billion in federal loans and insurance subsidies. That's a 15-fold increase over the five years
before Cheney
took over. (CorpWatch, May 2) Cheney's personal rewards were enormous. In 1998
alone, he
received $4.4 million in pay and benefits. He, like so many other corporate executives, received lucrative stock options. And like President George W. Bush, he managed to cash them in just before the company's stock plummeted in price. In May and August 2000, at a time when Halliburton
was still
selling for more than $50 per share, Cheney was paid $23.6 million for his stock. After Cheney got out, the stock plunged. Today it is selling for around $13. In recent weeks it has been revealed that while
Cheney was
CEO, Halliburton's stock price was artificially maintained by fraudulently inflating its bottom line. This was achieved by counting as income bills that customers, including the U.S. government, refused to pay: $89 million in 1998; $98 million in 1999; $113 million in 2000. These amounts were mainly for cost overruns. In May, the Securities and Exchange Commission
announced
that it was investigating Halliburton and its auditor, the now-infamous Arthur Andersen Co., for "aggressive" bookkeeping. What Andersen did for Cheney and Halliburton was
similar to
what it did for Enron and many other corporate executives: devise ways to fraudulently keep the stock price up until the executives could cash in their stock options. As the capitalist economy turned down, and lacking the kind of insider information available to CEOs, ordinary investors-- including many workers' pension funds--were left holding the bag. In 1996, Cheney did a promotional video for Arthur
Andersen
in which he praised the auditing giant for going "beyond the call of duty." What "beyond the call of duty" means for a bookkeeper is not too hard to figure out. CHENEY RETURNS TO WASHINGTON,
HALLIBURTON STAYS IN THE TROUGH
In January 2001, Cheney returned to Washington as
George W.
Bush's vice president. On Dec. 14 of the same year, Halliburton subsidiary KBR was awarded a unique contract called by the Pentagon a "Logistics Civil Augmentation Program" or LOGCAP. The contract is described in Pentagonese as a
"cost-plus-
award-fee, indefinite-delivery/indefinite-quantity service." Translation: a contract that has no time, material or dollar limits, with profits figured as a percentage--usually 9 percent--added onto the amount spent. In other words, the more that KBR spends, the more
the
company makes in profits. This is a common feature of Pentagon contracts. Initially, the contract for the Navy is for five
years and
for the Army a highly unusual 10 years. It makes KBR the only private supplier of Army logistic services over the next decade. "It is close to unprecedented for the government to
have
given so much of the solution to one contractor," is how Prof. Steven Spooner of George Washington University, who specializes in federal contracting, describes the Halliburton contract. (Boston Globe, Aug. 5) The Pentagon did not consider any other bidders for
LOGCAP,
a fact that might seem a little surprising given that KBR and Halliburton were under investigation for defrauding the military on earlier contracts. To settle that case, KBR paid $2 million to the Army for work it billed but never carried out at Fort Ord, Calif. And that's just the tip of a gigantic iceberg. In
February
1997, a General Accounting Office investigation revealed that KBR was billing the Army for plywood at $85.98 per sheet that cost $14 in the United States, for a project in Hungary. KBR's estimate for the contract in 1996 was $191 million; by the next year it had risen to $461 million. (Chatterjee, May 2002) Halliburton/KBR are directly profiting from the
so-called
"war on terrorism," in which its former CEO is such a driving force. KBR is building and maintaining new bases in Central Asia, and, under contract with the Navy, was paid $37 million to build 816 detention cells at Guantanamo Bay for prisoners captured in Afghanistan. Both Bush and Cheney are unquestionably guilty of
corporate
fraud and insider trading as defined in the "Corporate Responsibility" Act that Bush signed July 30. The fact that they still occupy plush offices rather than jail cells is due to their privileged position in class society. But what Cheney's story shows is that the problem
is not
just corrupt individuals, but a thoroughly corrupt system. - END -
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