Fixing Halliburton & Iraq?
Published on Saturday, November 18, 2006 by
Fixing Halliburton & Iraq?
by Christopher Brauchli

That Was the Week That Was
-A 1960s Television Program

It was nothing more than a coincidence. During the days after the election there were stories about how Halliburton was hoping to fix problems created by Dick Cheney when he worked there and George Bush announced that he hoped to fix problems he had created in Iraq while working in the White House.

Halliburton was the company that benefited more than the rest of the country from Dick Cheney’s move to Washington and subsequent ascendancy to the vice presidency. Halliburton benefited not because being vice president enabled Mr. Cheney to steer business to Halliburton and its subsidiary, KBR, something everyone knows he would never dream of doing since he is an honorable man. The reason Halliburton was glad to see Mr. Cheney become vice president was because it moved him from board meetings (where he made bad decisions that cost the company money) into cabinet meetings (where he made bad decisions that cost thousands of people their lives). On the other hand those bad decisions helped his former employer make lots of money thus offsetting the harm he did while serving as its president if not the harm he did the world while serving as vice president

As president of Halliburton Mr. Cheney engineered Halliburton’s acquisition of Dresser Industries, an acquisition that according to Floyd Norris of the New York Times, made Halliburton the world’s largest provider of oil field services. What Dick Cheney neglected to do, was check out Dresser Industries to see exactly what it was getting in addition to enhancing its oil field services capability. If Dick Cheney had done due diligence he would have learned that Dresser’s subsidiary, Kellogg, Brown & Root, (now known as KBR) (a) had asbestos liabilities that would eventually cost the company billions of dollars, (b) may have been involved in bribing Nigerian officials in order to get contracts in that country and (c) according to the prospectus issued in connection with its initial public offering that is to occur during the third week in November, “may have engaged in coordinated bidding with one or more competitors on certain foreign construction projects. . . . ”

KBR is now being investigated by the U.S. Justice Department for possible violations of the corrupt practices act and the SEC is investigating whether KBR violated the Foreign Corrupt Practices Act because of bribes it paid Nigerian officials. Past possible corrupt practices is not its only claim to fame. In Iraq its excesses include billing for food not served, gasoline not delivered, trucks not used and work not performed.

During the week of November 12 Halliburton is selling 20% of the stock in KBR and in 2007 will distribute the rest of the stock to Halliburton shareholders thus ridding itself of a company that was more albatross than profit center. As news and discussion of Halliburton’s stock sale and distribution designed to cure the remnants of the Cheney legacy were taking place, a chastened frat boy named George Bush announced he was hoping to fix that which until early Wednesday morning after the Tuesday election he was unaware needed fixing-Iraq.

The week before the election Mr. Bush announced that Donald Rumsfeld had his confidence and would remain as secretary of defense until the end of Mr. Bush’s term. The morning after the election Mr. Bush announced that Mr. Rumsfeld was being replaced by Robert M. Gates. That was good news. What was astonishing was the disclosure from White House insiders and outsiders, that Rumsfeld’s removal had been contemplated since late summer.

The reason it was not then announced was not because Mr. Bush intended to keep him on. According to reports citing White House insiders and outsiders, it was because, among other things, Mr. Bush did not want to give his critics the opportunity to say the change was politically inspired nor did he want opponents to have the chance to say his removal proved the correctness of their criticism thus giving ammunition to the Democrats they could use in the fall elections.

If George Bush had made his announcement when he first made the decision irrespective of the political consequences, a new Secretary of Defense could already be in place. If the change of Secretary of Defense suggests a change in policy and if a change in policy will ultimately result in a reduction in the number of dead and wounded American service personnel, as it surely will when the withdrawals begin to take place, it seems a pity that Mr. Bush delayed changing the policy fearing a change might adversely affect Republicans in November. Some people would have thought saving lives should be the highest priority. George Bush is not among them.

Christopher Brauchli is a Boulder lawyer and formerly wrote a weekly column for the Knight Ridder news service. He can be reached at