Cheney's Multi-Million Dollar Revolving Door
News: As Bush Sr.'s secretary of defense, Dick Cheney steered millions of dollars in government business to a private military contractor -- whose parent company just happened to give him a high-paying job after he left the government.
By Robert Bryce
Mother Jones
August 2, 2000
EXCERPT...
In 1992, the Pentagon, then under Cheney's direction, paid Texas-based Brown & Root Services $3.9 million to produce a classified report detailing how private companies -- like itself -- could help provide logistics for American troops in potential war zones around the world. BRS specializes in such work; from 1962 to 1972, for instance, the company worked in the former South Vietnam building roads, landing strips, harbors, and military bases. Later in 1992, the Pentagon gave the company an additional $5 million to update its report. That same year, BRS won a massive, five-year logistics contract from the US Army Corps of Engineers to work alongside American GIs in places like Zaire, Haiti, Somalia, Kosovo, the Balkans, and Saudi Arabia.
After Bill Clinton's election cost Cheney his government job, he wound up in 1995 as CEO of Halliburton Company, the Dallas-based oil services giant -- which just happens to own Brown & Root Services. Since then, Cheney has collected more than $10 million in salary and stock payments from the company. In addition, he is currently the company's largest individual shareholder, holding stock and options worth another $40 million. Those holdings have undoubtedly been made more valuable by the ever-more lucrative contracts BRS continues to score with the Pentagon.
Between 1992 and 1999, the Pentagon paid BRS more than $1.2 billion for its work in trouble spots around the globe. In May of 1999, the US Army Corps of Engineers re-enlisted the company's help in the Balkans, giving it a new five-year contract worth $731 million.
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Although the US military has long relied on contractors for various services, the issue for some observers is the possibility that Cheney used his contacts within government to enrich himself. “We are talking about nepotism of the highest order and profiteering at the expense of the US taxpayers,” says Pratap Chatterjee, a radio journalist who has followed Halliburton for several years.
Chatterjee points out that BRS gets a one percent profit guarantee on their logistics contracts and that in Somalia, the company was given another eight percentage points for meeting various incentive clauses in their contract. “Compare that with average corporate profit percentages, which are about three percent,” he said.
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