As Iraq death toll rises, so do war profits

WASHINGTON – As the roster of dead and wounded in Iraq grows longer, George W. Bush is pleading that the people of this country stay the course despite admissions by his administration that the occupation has become a “long, hard slog.”

But Bush faces tough questions, including this one: Why does he demand the ultimate sacrifice from our nation’s working-class youth while his wealthy contributors make no sacrifice at all? On the contrary, Halliburton and Bechtel, with crony ties to the Bush White House, have reaped a bonanza in war profits.

Are U.S. soldiers and countless Iraqis dying to insure blood money for Halliburton, and its subsidiary, Kellogg Brown & Root (KBR)? How much of the $87 billion just approved by Congress for Iraq will end up in the coffers of Chevron-Texaco, and J.P. Morgan, two other Iraq contractors?

Halliburton-KBR, the Houston-based oil-field equipment corporation, secured a $2.3 billion no-bid, cost-plus contract for the so-called “reconstruction of Iraq,” the largest single contract awarded so far. The trail of money and death leads to Halliburton’s former CEO, Dick Cheney, who received a $33 million severance package when he stepped down to become Bush’s running mate. Cheney is still receiving deferred payments from the corporation, a case of cashing in on the death and misery of U.S. military personnel deployed in Iraq.

Similar corrupt deals in Iraq have been granted to the Bechtel Corp. ($1.03 billion), International American Products ($527 million), Perini Corp. ($525 million), Fluor ($500 million), and the Washington Group International ($500 million). The CBS news program, “60 Minutes,” carried a feature story on Halliburton. The program pointed out that many of the key decisions in the Iraq war and its aftermath have been made by the Pentagon’s Defense Policy Board (DPB). The 30 members of this secretive body “are a ‘Who’s Who’ of former government and senior military officials. … Nine have ties to corporations that have won $76 billion in defense contracts in just two years.” Among the DPB members are Richard Perle, who has longstanding ties to Boeing, and retired General Jack Sheehan, vice president of the Bechtel Corp.

Neoconservatives like Cheney, Defense Secretary Donald Rumsfeld, Assistant Secretary of Defense Paul Wolfowitz, and the DPB have played the central role in drawing up and implementing the preemptive and unilateral war strategy against Iraq. One of the principal motives for the unilateralism was to oust France, Germany, and Russia, each of which had billions of dollars in Iraqi investments, and to hand these juicy plums over to Bush-connected U.S. corporations. Iraq holds the second-largest oil reserves in the world after Saudi Arabia.

A windfall in Bush’s election coffers

The Center For Public Integrity released a report on Oct. 30, titled “Windfalls of War: U.S. Contractors in Iraq and Afghanistan.” The report charges that 70 U.S. corporations with $8 billion in no-bid contracts in Iraq have donated $500,000 to the Bush 2004 election campaign (cheap at the price). Since 1990, the report adds, these same companies have poured $49 million into the coffers of mostly Republican candidates for federal and state political office.

Chevron-Texaco, listed in the report as a major U.S. government contractor and Republican donor, joined five other international oil companies selected by the Iraqi State Oil Marketing Organization to market Iraqi oil. J.P. Morgan, the nation’s second-largest bank, which was implicated in the Enron scandal, has been contracted by the Iraq Coalition Provisional Authority (CPA) to run a consortium of 13 banks that will constitute the Trade Bank of Iraq.

A White House cover-up

The Center charged that they were hampered in their research by administration secretiveness and stonewalling. Many of the contracts have been classified as secret in the name of national security, a perfect cover for corporate and government thievery. But the people are paying with their tax dollars and their sons’ and daughters’ blood, and understandably demand to know how their money is being spent in Iraq.

During debate on the administration’s request for $87 billion for the occupation of Iraq and Afghanistan, on Oct. 15, Rep. Henry Waxman (D-Calif.), ranking member of the House Committee on Government Reform said, “There is growing evidence that favored contractors like Halliburton and Bechtel are getting sweetheart deals that are costing the taxpayers a bundle but delivering scant results.”

Waxman cited a deal in which Halliburton was paid $162.5 million by the Pentagon in the six months since the war ended to truck 61 million gallons of gasoline from Kuwait into Iraq, at about $2.65 per gallon. The gas was then sold in Iraq for 4 cents to 15 cents per gallon. The difference was made up by U.S. taxpayers.

Waxman and Rep. John Dingell (D-Mich.) wrote a joint letter to National Security Adviser Condoleezza Rice in her new position as overseer of the Iraq occupation. “The U.S. government is paying nearly three times more for gasoline from Kuwait than it should and is then reselling this gasoline at a huge loss inside Iraq,” they wrote. “Whether this is due to incompetence, malfeasance, or some other reason, the waste of taxpayer dollars must be stopped.” Waxman and Dingell point out that Bush requested $900 million for “fuel imports” in the $87 billion Iraq aid package.

The big Iraqi oil grab

In a letter dated May 2, Lt. Gen. Robert B. Flowers of the U.S. Army Corps of Engineers which is handling the Iraqi contracts informed Waxman that the Bush administration was preparing a new contract to replace the original $2.3 billion Halliburton deal. This new plan would be “long term” and involve not only extinguishing oil well fires and repair of Iraqi oilfield equipment. It would also put Halliburton in charge of the “operation” of Iraqi oilfields and the “distribution” of Iraqi oil. The real value of this contract to Halliburton would be at least $7 billion.

Waxman fired off a reply to Flowers: “These new disclosures are significant and seem at odds with the administration’s repeated assurances that Iraqi oil belongs to the Iraqi people,” he wrote.

Two members of the Iraqi Governing Council met in Washington with Waxman staff members, telling them, “The costs to the American taxpayer of many reconstruction projects could be reduced by 90 percent if the contracts were awarded to local Iraqi companies rather than to large government contractors like Halliburton or Bechtel.”

He cites as an example a war-idled cement plant in Northern Iraq. Major Gen. David Petraeus announced it would cost $15 million to reopen the plant if the job were assigned to Bechtel. But Iraqis restored production for $80,000.

Bechtel told Iraqi construction firms they could not bid on contracts to reopen the Baghdad International Airport without first securing three types of insurance unknown to the Iraqis. When an Iraqi contractor asked how to acquire this insurance, a Bechtel executive replied, “Don’t worry, there will be American insurance companies coming in to sell insurance.”

Privatizing Iraq

The weekly Moscow News reports that the Bush administration’s financial and trade policies toward Iraq are intent on rapidly privatizing Iraq’s largely state-run economy into a captive market for U.S. multinational corporations.

New laws drafted by Bush’s Iraq czar, Paul Bremer, and unveiled Sept. 21, allow foreign investors to own 100 percent of any Iraqi assets and to remit profits and royalties when they choose.

A key adviser to Bremer is Wall Street investor, Tom Foley, a generous Bush contributor. He cooked up a scheme to invite 14 Eastern European finance officials to Baghdad to give advice about privatization. They included the notorious Yegor Gaidor, who presided over the Russian mass privatizations of the early 1990s, Moscow News reports.

As if on cue, Iraq’s new oil minister, Ibrahim Bahr al-Uloum, handpicked by the Bush administration, announced that his main aim is the privatization of Iraqi oil.

The presence of Russian privateers in Iraq was ironic. Russian oil billionaire, Mikhail B. Khodorkovsky, owner of Yukos Oil, was arrested in Siberia recently on charges of conniving secretly to sell out the ownership of Russia’s fabulous oil fields to Exxon-Mobil. Like the Bush-Cheney gang, Khodorkovsky was using his billions to bankroll political parties under his control in preparation to run for the presidency of Russia. Bush, Cheney, and the rest of the White House crew are seeking to impose this same brand of oily sellout politics on Iraq.

Stop the looting, bring the troops home!

Iraq war profiteering is stirring a backlash in the U.S. among families angry that their sons and daughters have been placed in harm’s way to enrich Cheney and his ilk.

The Institute for Southern Studies, based in Durham, N.C., recently unveiled its “Stop the War Profiteers Campaign.” Supporters are invited to sign an online petition at www.southernstudies.org. The petition demands that Congress investigate the war profiteering, enact an “excess profits tax” on the profiteers, and end the “corporate take-over and selling off of Iraq’s industry and resources … that they be returned immediately to the Iraqi people.”

Dr. Rania Masri, a coordinator of the campaign, declares, “A handful of Bush-connected corporations are poised to make billions in profits while U.S. troops are killed almost daily and Iraq plunges deeper into a colonial nightmare. Halliburton, Bechtel, MCI, and other war profiteers are part of a larger invasion by outside corporate interests hoping to control the wealth and resources of Iraq – wealth and resources that belong to the Iraqi people.”

So far, 600 organizations, including Veterans for Peace, New York Labor Against the War, Global Exchange, and United for Peace and Justice, as well as authors Noam Chomsky, Jim Hightower, and Howard Zinn, have signed on to the campaign’s founding statement.

“The U.S. is rushing to open Iraq to a flood of outside corporate interests before the country’s own government can take power,” said Chris Kromm, director of the Institute for Southern Studies, which publishes the pro-labor, pro-civil rights magazine, Southern Exposure. “If the Iraq war was really about democracy, why don’t they wait and let the Iraqi people decide what to do with their economy?”

Rep. Dennis Kucinich (D-Ohio), a Democratic presidential contender, has also spoken out against the war profiteering. In his announcement speech on Oct. 13 in Cleveland he laid out his plan to end the war: “Number one, that the UN will handle all the oil assets on behalf of the Iraqi people with no privatization. … Number two, that the UN will handle the contracts. No more Halliburton sweetheart deals. No more war profiteers, no more contracts going to political contributors of the administration. … We need to bring the UN in and bring our troops home.”