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Halliburton Lost My Lunch Money

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Yesterday, the Pentagon recommended withholding $161,000,000 in payments to one of their biggest private contractors, Halliburton (aka Kellog, Brown & Root.) (As you probably know by now, Halliburton is not only Dick Cheney’s Retirement Cash Cow, but it’s Donald Rumsfeld’s main ally in the “privatizing” of the military.)

Pentagon auditors said that the $161,000,000 was for overbilling soldier meals. (“Overbilling” is a special Bush administration euphemism for “FRAUD & THEFT” from the American taxpayer.)

(In case you’re wondering why Halliburton, the oil services company, is cooking dinner for G.I. Janes and Joes, a bit of explanation is in order: A few years ago, the Republicans decided that invoicing the Military-Industrial Complex was just too complex, so they decided that rather than have the money go from taxpayer to government to DOD to defense contractors — and eventually into their own pockets — the system would be quicker and more effective if it was rearranged as follows: taxpayer to government to private contractors/top officials in the Bush administration. In the process, they took out a few “middle-men” — as well as a great deal of competitive bidding and congressional oversight. They also decided that “privatizing non-combatant military functions” would be an excellent euphemism for “raping the American taxpayer with no-bid contracts to good ol’ boy networks of friends and family.”)

Hellooooo — Kellog, Brown & Root!

Anyway, these days, when we’ve heard the phrase “BILLIONS of dollars” tossed around the Iraq disaster like it’s chump change, we tend to lose sight of context and the relative value of such gigantic terms. So let’s play a little math game with Halliburton’s FRAUD & THEFT, shall we?

$161,000,000 – that’s one-hundred and sixty-one MILLION dollars that Halliburton fraudulently stole from YOU and Uncle Sam.

Let’s take a ridiculously conservative number — say $10 for the price of one soldier’s meal. That means Halliburton milked the Pentagon for 16,100,000 (ie. SIXTEEN MILLION, one-hundred thousand) Unhappy Meals for soldiers in Iraq.

If we use a more likely number, say $5 per meal, the number obviously becomes 32,200,000 (ie THIRTY-TWO MILLION, two-hundred thousand) meals that were accidentally billed to you and me.
Imagine your customer calling to say, “Excuse me, that last order was for 32 widgets and you billed me for 32 million widgets.”

THE GOOD NEWS: But don’t worry, this was only a $161,000,000 “mistake”. In the overall scheme in the “war in Iraq”, that’s just a drop in the $175 BILLION bucket.

And it just goes to show that not only does this administration make an occasional mistake, but so do their suppliers. Nobody’ perfekt.

And for George W. Bush and his fellow criminals, War means never having to say you’re sorry.


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About Mark Shark

  • Shark you will tell the other side of the story won’t you? Or do you chose to keep you idealogical blinders in place? I guess the answer is plain to see, so here is the other side. The side that places the root of the problem at the feet of Bush 41, and how Clinton not only continued the program but awarded it to KBR despite a lower bid being offered.


    The first LOGCAP was awarded in 1992, as the first Bush administration (including then-Secretary of Defense Cheney) was leaving office. Four companies competed, and the winner was Brown & Root, as it was known at the time (Halliburton changed the name to Kellogg Brown & Root after an acquisition in 1998). The multi-year contract was in effect during much of the Clinton administration. During those years, Brown & Root did extensive work for the Army under the LOGCAP contract in Haiti, Somalia, and Bosnia; contract workers built base camps and provided troops with electrical power, food, and other necessities.

    In 1997, when LOGCAP was again put up for bid, Halliburton/Brown & Root lost the competition to another contractor, Dyncorp. But the Clinton Defense Department, rather than switch from Halliburton to Dyncorp, elected to award a separate, sole-source contract to Halliburton/Brown & Root to continue its work in the Balkans. According to a later GAO study, the Army made the choice because 1) Brown & Root had already acquired extensive knowledge of how to work in the area; 2) the company “had demonstrated the ability to support the operation”; and 3) changing contractors would have been costly. The Army’s sole-source Bosnia contract with Brown & Root lasted until 1999. At that time, the Clinton Defense Department conducted full-scale competitive bidding for a new contract. The winner was . . . Halliburton/Brown & Root. The company continued its work in Bosnia uninterrupted.

    That work received favorable notices throughout the Clinton administration. For example, Vice President Al Gore’s National Performance Review mentioned Halliburton’s performance in its Report on Reinventing the Department of Defense, issued in September 1996. In a section titled “Outsourcing of Logistics Allows Combat Troops to Stick to Basics,” Gore’s reinventing-government team favorably mentioned LOGCAP, the cost-plus-award system, and Brown & Root, which the report said provided “basic life support services — food, water, sanitation, shelter, and laundry; and the full realm of logistics services — transportation, electrical, hazardous materials collection and disposal, fuel delivery, airfield and seaport operations, and road maintenance.”


    Your right Shark: “Nobody’ perfekt.” But you choose to see only one side.

  • Shark

    Marc, thanks for the reminder; the Clinton Admin. basically inherited many of the DOD/Halliburton relationships from a previous administration, the one whose Defense Secretary was Dick Cheney. Cheney renewed and revamped the DOD structure/processes (privatizing) and then left to join the company to which he had given all the advantages.

    If not criminal, unethical at the very least.

    See Para. #4 below.

    PS: Iraq is still about BLOOD FOR OIL.

    …And Marc, when are you going to learn the difference between “you’re” and “your”??


    The New Yorker
    by Jane Mayer


    “…Last year, for example, a secret task force in the Bush Administration picked Halliburton to receive a noncompetitive contract for up to seven billion dollars to rebuild Iraq’s oil operations.

    Last year, a division of the company overcharged the government by as much as sixty-one million dollars in the course of buying and transporting fuel from Kuwait into Iraq. Halliburton charged the United States as much as $2.38 per gallon, an amount that a Pentagon audit determined to be about a dollar per gallon too high.

    …two of its employees…had taken kickbacks resulting in overcharges of $6.3 million, in return for hiring a different Kuwaiti subcontractor in Iraq. Halliburton said that the employees, whose names it declined to reveal, had been fired and the funds returned. The day after this disclosure, the Pentagon awarded yet another contract to Halliburton, worth $1.2 billion, to rebuild the oil industry in southern Iraq.

    …[Cheney] has been both an architect and a beneficiary of the increasingly close relationship between the Department of Defense and an elite group of private military contractors–a relationship that has allowed companies such as Halliburton to profit enormously. As a government official and as Halliburton’s C.E.O., he has long argued that the commercial marketplace can provide better and cheaper services than a government bureaucracy. He has also been an advocate of limiting government regulation of the private sector. His vision has been fully realized: in 2002, more than a hundred and fifty billion dollars of public money was transferred from the Pentagon to private contractors.

    …The company made political contributions of more than seven hundred thousand dollars between 1999 and 2002, almost always to Republican candidates or causes. In 2000, it donated $17,677 to the Bush-Cheney campaign. Indeed, the seventy or so companies that have Iraq contracts have contributed more money to President Bush than they did to any other candidate during the past twelve years.

    …Toward the end of Cheney’s tenure [as Sect’y. of Defense], the Pentagon decided to turn over to a single company the bulk of the business of planning and providing support for military operations abroad–tasks such as preparing food, doing the laundry, and cleaning the latrines. As Singer writes in “Corporate Warriors,” the Pentagon commissioned Halliburton to do a classified study of how this might work. In effect, the company was being asked to create its own market.

    …Halliburton was paid $3.9 million to write its initial report, which offered a strategy for providing support to twenty thousand troops. The Pentagon then paid Halliburton five million dollars more to do a follow-up study. In August, 1992, Halliburton was selected by the U.S. Army Corps of Engineers to do all the work needed to support the military during the next five years, in accordance with the plan it had itself drawn up.

    …After Cheney’s tenure at the Pentagon ended, in 1993, with the arrival of the Clinton Administration, he spent much of the next two years deciding whether to run for President. He formed a political-action committee, and crossed the country making speeches and raising money. He also became affiliated with the American Enterprise Institute, the conservative think tank. Records from the Federal Election Commission show that Cheney’s pac contributors included executives at several of the companies that have since won the largest government contracts in Iraq. Among them were Thomas Cruikshank, Halliburton’s C.E.O. at the time; Stephen Bechtel, whose family’s construction-and-engineering firm now has a contract in Iraq worth as much as $2.8 billion; and Duane Andrews, then senior vice-president of Science Applications International Corporation, which has won seven contracts in Iraq.

    …The United States had concluded that Iraq, Libya, and Iran supported terrorism and had imposed strict sanctions on them. Yet during Cheney’s tenure at Halliburton the company did business in all three countries. In the case of Iraq, Halliburton legally evaded U.S. sanctions by conducting its oil-service business through foreign subsidiaries that had once been owned by Dresser. With Iran and Libya, Halliburton used its own subsidiaries.

    …In the five years before Cheney joined Halliburton, the company received a hundred million dollars in government credit guarantees. During Cheney’s tenure, this amount jumped to $1.5 billion.

    …The Bush Administration’s war on terror has became a source of substantial profit for Halliburton. The company’s commercial ties to terrorist states did not prevent it from assuming a prominent role. The Navy, for instance, paid Halliburton thirty-seven million dollars to build prison camps in Cuba’s Guantanamo Bay for suspected terrorists. The State Department gave the company a hundred-million-dollar contract to construct a new embassy in Kabul. And in December, 2001, a few years after having lost its omnibus military-support contract to a lower bidder, Halliburton won it back; before long, the company was supporting U.S. troops in Afghanistan, Kuwait, Jordan, Uzbekistan, Djibouti, the Republic of Georgia, and Iraq. Halliburton’s 2002 annual report describes counterterrorism as offering “growth opportunities.”

    …The Department of Defense’s decision to award Halliburton the seven-billion-dollar contract to restore Iraq’s oil industry was made under “emergency” conditions. The company was secretly hired to draw up plans for how it would deal with putting out oil-well fires, should they occur during the war. This planning began in the fall of 2002, around the time that Congress was debating whether to grant President Bush the authority to use force, and before the United Nations had fully debated the issue. In early March, 2003, the Army quietly awarded Halliburton a contract to execute those plans.”

    === end of excerpts ===

  • Shark

    Halliburton… criminals… again…

    From MSNBC:

    “The Pentagon has already awarded Halliburton Co., the controversial military contractor, deals worth up to $18 billion for its work in Iraq.  But now former Halliburton insiders have come forward with new allegations of massive waste of taxpayer money.

    …Marie deYoung, a former Army chaplain who worked for Halliburton, was so upset by attacks on the company she e-mailed the CEO in December with a strategy on how to fight the “political slurs.” 

    But today, after five months inside Halliburton’s operation in Kuwait, deYoung has radically changed her opinion. “It’s just a gravy train,” she said.

    DeYoung audited accounts for Halliburton’s subsidiary KBR.  She claims there was no effort to hold down costs because all costs were passed on directly to taxpayers.  She repeatedly complained to superiors of waste and fraud.  The company’s response, according to deYoung was: “We can be as dumb and stupid as we want in the first year of a war, nobody’s going to care.”

    …DeYoung produced documents detailing alleged waste even on routine services: $50,000 a month for soda, at $45 a case; $1 million a month to clean clothes — or $100 for each 15-pound bag of laundry.

    “That money could have been used to take care of soldiers,” she said.

    — end of excerpt —

    Jeez, “Halliburton” and “Cheney” are starting to have that “Whitewater” and “Monica” ring to them, don’t they?

    I wonder if we should look for Cheney to remain in his Presidential Bunker for the next five months?

    (Or perhaps he’ll sneak out of the White House and stealthily as Paul Bremer snuck out of Iraq– after he handed over non-existent keys to a non-existent government run by non-existent leaders with non-existent powers over a non-existent Iraqi security force?)

    Whoo-hoo! THINGS ARE GREAT!

  • I don’t think Cheney will stay on the ticket. Among my political friends, half think I am an absolute lunatic on that point and the other half wonder why I am bothering to state the obvious.

  • Shark

    Justine, I almost tend to agree, but then again, Bush & Co. NEVER, ever, evereverever admit they’ve made a mistake.

    And dumping the puppetmaster would be an implicit admission.

    So I think Cheney stays.

    Besides, w/Nader running and the shenanigans we’ll see with the ‘electronic’ votes, they don’t need to worry.

    Expect Fuhrer More Years.

  • Dan

    I thought Nader was out?

  • Thomas Jasper

    Bush Lied, troops Died! It REALY is that simple.