Halliburton Agenda

The Politics of Oil and Money

Book by Dan Briody

Article and Review by GlobalMacroForex

The parallels between the Vietnam and Iraq wars are pretty striking when one considers that Brown & Root (Halliburton’s subsidiary) was not only the exclusive private contractor for both but also had direct financial ties to the politicians who escalated the wars (Lyndon Johnson and Dick Cheney).  In this brief summary article of Dan Briody’s book, we’ll cover the basic outline of this truly corrupt story…

Lyndon Johnson

Herman Brown was the CEO of Kellogg Brown & Root, a construction company in Texas.  The company initially faced some problems with securing its contract for the Marshall Ford Dam, but Herman Brown was able to buy the support of Lyndon B. Johnson to approve the project.  Direct funding of political candidates by corporations was forbidden, so Herman Brown had to resort to methods that are more roundabout.

Herman Brown had an entire group of businessmen known as the “Suite 8F Crowd,” so nicknamed after the place they frequently met at in the Lamar Hotel in Texas.  Through this entire network chain of local businesses, Herman Brown would break the money up into smaller individual donations and distribute it out to employees of all these companies.  Through this corrupt scheme, Brown was able to funnel well over $200,000 illegally to Lyndon Johnson.  In addition, this group used its influence to outright buy votes in southern Texas.

While the original deceased founder of Halliburton, Erle Halliburton, detested politics, his company bought Brown & Root in 1962.  This started a long union that would profit from many government projects — at first through Lyndon Johnson.

Vietnam

Lyndon Johnson directly escalated the Vietnam War, and Brown & Root was the military subcontractor of choice. Brown & Root was in Vietnam from 1965 to 1975 and billed over $380 million in revenue.  They built everything from roads to entire cities for the US military.

“RMK-BRJ [Brown & Root] built two 10,000 for jet runway in Chulai; two jet runways in Phanrang; ammunition and fuel storage facilities; barracks; helicopter landing pads; pipelines; hospitals; communications facilities; and warehouses… They were moving enough dirt to dig the Suez Canal and paving enough roads to surface the Jersey Turnpike every 30 days.  They had a small army of their own in the country, 51,000 at the height of the operations in 1967, the largest employer in Vietnam.”

A large portion of the money going to Brown & Root wasn’t being used efficiently or was purposefully being funneled to other places.  A New York Times study found that “40% of the billions being spent in Vietnam was being stolen, used in bribes, or outright wasted at the rate of half a million dollars a day.”  In addition, workers were selling goods on the local Vietnamese black market and causing a variety of problems.

When Lyndon Johnson died in 1973, it set a temporary pause and decline for the company.

LOGCAP

Things improved for Brown & Root when it won and designed LOGCAP.  LOGCAP is a contract to service the entire US military by a single subcontractor.  Brown & Root helped design the contact and not surprisingly won it for many years.  From 1995 and 2000, Brown & Root was given the full award fee for five evaluation periods.  In fact, Brown & Root became so indispensable that when its contract expired and was awarded to competitor Dyncorp, Brown & Root still kept the Balkans as part of the Balkans Support Contract because the US military was so dependent on them.

Iraq

Halliburton admitted to and paid fines for its deals with Libya and Iran despite US sanctions, but CEO Dick Cheney denied Halliburton did business with Iraq.  In September 1998, Halliburton bought Dresser Industries, which coincidently is the firm at which George H.W Bush had his first job.  Dresser Industries was dealing with Iraq through the “Oil for Food” Program.

This Oil for Food Program was to be corrupt.  The original concept was that Saddam Hussein would trade oil for food and for medical supplies for his people.  Instead, the program was manipulated to allow for kickbacks that allowed Saddam Hussein to arm.

“Saddam used this money for everything from luxury goods to weapons and training for his military.”  Dan Briody notes that it was general knowledge among the US side that the program was a complete joke.

“General Tommy Franks who was the US commander of forces in Iraq called it “Oil for Palaces.”

On ABC-TV in 2000, Dick Cheney denied doing business with Iraq while he was running for Vice President.  However, after the evidence piled against him, 3 weeks later he admitted Halliburton did $30 million of business that he claims he was unaware of.  Author Dan Briody points out the hypocrisy of this.

“It’s difficult to imagine how Cheney justified in his own mind profiting from sales with Saddam Hussein, through a program that was widely known to be a joke.  In essence, Cheney had gone to war against Iraq as Defense Secretary, helped rebuild Iraq’s oil business and military as CEO of Halliburton then went to war again as Vice President.  Apparently, how evil Saddam Hussein was depends on which side of the business-government continuum you currently sit.”

Conclusion

Dan Briody does a wonderful job at summarizing how this small construction firm from Texas managed to become the biggest private military contractor in America.  Through propping up Lyndon Johnson with illegal campaign money, Halliburton managed to secure many government-funded projects including Vietnam, for which they abused and overcharged.  This tradition continued with Dick Cheney becoming CEO, then using Halliburton to build up Saddam Hussein’s army through the Oil for Food Program.  Then afterwards, Cheney became Vice President, managing the invasion of Iraq with Halliburton again as the private contractor.  It is truly eye-opening to learn the horrible history of rampant corruption that surrounds this company as it contributes towards perpetual war for profit.