Military Industrial Complex: Bush and Halliburton

[John Simkin]

First while I agree that the lack of education is factor, its not because the schools are that bad but rather its the lack of desire by the students. I've seen this first hand. They don't care. The schools are partly to blame, they just pass these kids along rather than keep them back until they actually learn.

I have taught in schools since 1977 and I profoundly disagree with your analysis of the situation. Motivation is a problem but this is not directly the reason why kids from disadvantaged backgrounds fail to do well at school. We have to get things in the right order:

1. Children without the right support from the home begin to struggle with their academic work.

2. They receive low grades, negative comments, are placed in lower sets, etc. To be told you are failing lowers your motivation. This of course reduces motivation and they fall further behind.

The answer to this problem is for the government to take measures that helps to reduce the disadvantages they face in the classroom. Governments have never been willing to do this because it would go down badly with people from advantageous backgrounds. It is this group that applies the most pressure on politicians. In other words, it would be a vote loser. (A large percentage of people from disadvantaged backgrounds do not bother to vote in elections.)

Did I mention our schools are mostly run and staffed by leftists?

Where did you get the idea from? Unfortunately, every school that I have ever taught in has been run and staffed by people with strong conservative attitudes. This is not surprising as everybody in education have achieved academic success by using the existing system. They are therefore slow to see the flaws in the system. For example, most teachers are in favour of streaming or setting. As they have never experienced what it is like to be in a bottom stream, they have little understanding of the negative impact it has on student motivation.

[Craig Lamson]

First while I agree that the lack of education is factor, its not because the schools are that bad but rather its the lack of desire by the students. I've seen this first hand. They don't care. The schools are partly to blame, they just pass these kids along rather than keep them back until they actually learn.

I have taught in schools since 1977 and I profoundly disagree with your analysis of the situation. Motivation is a problem but this is not directly the reason why kids from disadvantaged backgrounds fail to do well at school. We have to get things in the right order:

1. Children without the right support from the home begin to struggle with their academic work.

2. They receive low grades, negative comments, are placed in lower sets, etc. To be told you are failing lowers your motivation. This of course reduces motivation and they fall further behind.

The answer to this problem is for the government to take measures that helps to reduce the disadvantages they face in the classroom. Governments have never been willing to do this because it would go down badly with people from advantageous backgrounds. It is this group that applies the most pressure on politicians. In other words, it would be a vote loser. (A large percentage of people from disadvantaged backgrounds do not bother to vote in elections.)

Did I mention our schools are mostly run and staffed by leftists?

Where did you get the idea from? Unfortunately, every school that I have ever taught in has been run and staffed by people with strong conservative attitudes. This is not surprising as everybody in education have achieved academic success by using the existing system. They are therefore slow to see the flaws in the system. For example, most teachers are in favour of streaming or setting. As they have never experienced what it is like to be in a bottom stream, they have little understanding of the negative impact it has on student motivation.

And your teaching experience in the USA is what? I guess you study of American history missed the parts about the political leanings and power of the teachers unions and the treatment of conservatives both as teachers and students in higher education.

And then there is that school choice thing designed to give parents the right to take the tax dollars assigned to their kids and take both the money and the kids to the school of their choice. Of course the liberals both in government and the teachers unions have a heart attact about that one....to hell with

the kids.

While I agree that strong family values and support are instrumental, the bottom line is either the kid decides to do the work or they don't. Neither the family nor the government can change that little fact. Nothing creates motivation like failure, and when used properly failure it the BEST method of learning anything. Removing the downide of failure is a mistake. What a terrible way to create adults that will have to compete in the real world that to take away the downside of failure.

Why would helping bad students improve go down badly for the advantaged. The opposite is true. More educated children become more productive adults, which lowers the burdens on the taxpayer and society in the long run.

I my view the ones with little interest in the progress of disadvantaged students are the liberals. After all one of their biggest voting blocks are the disadvantaged and the poor...you know the people to whom these liberals always promise the keys to the national treasury...Boosting them up actually HURTS the liberals.

Edited July 22, 2006 by Craig Lamson

[Terry Mauro]

First while I agree that the lack of education is factor, its not because the schools are that bad but rather its the lack of desire by the students. I've seen this first hand. They don't care. The schools are partly to blame, they just pass these kids along rather than keep them back until they actually learn.

I have taught in schools since 1977 and I profoundly disagree with your analysis of the situation. Motivation is a problem but this is not directly the reason why kids from disadvantaged backgrounds fail to do well at

While I agree that strong family values and support are instrumental, the bottom line is either the kid decides to do the work or they don't. Neither the family nor the government can change that little fact. Nothing creates motivation like failure, and when used properly failure it the BEST method of learning anything. Removing the downide of failure is a mistake. What a terrible way to create adults that will have to compete in the real world that to take away the downside of failure.

Why would helping bad students improve go down badly for the advantaged. The opposite is true. More educated children become more productive adults, which lowers the burdens on the taxpayer and society in the long run.

I my view the ones with little interest in the progress of disadvantaged students are the liberals. After all one of their biggest voting blocks are the disadvantaged and the poor...you know the people to whom these liberals always promise the keys to the national treasury...Boosting them up actually HURTS the liberals.

****************************************************

"Nothing creates motivation like failure, and when used properly failure it the BEST method of learning anything. Removing the downide of failure is a mistake. What a terrible way to create adults that will have to compete in the real world that to take away the downside of failure.

Why would helping bad students improve go down badly for the advantaged. The opposite is true. More educated children become more productive adults, which lowers the burdens on the taxpayer and society in the long run.

I my view the ones with little interest in the progress of disadvantaged students are the liberals. After all one of their biggest voting blocks are the disadvantaged and the poor...you know the people to whom these liberals always promise the keys to the national treasury...Boosting them up actually HURTS the liberals."

SIEG HEIL, Herr Goebbels! I suggest we pack them off on cattle cars and ship them to the ovens and the glue factories. They'd better much better utilized as candles and lampshades, don't you think? Too stupid to become anything else, eh?

Lamson, you're a dickhead.

[Jack White]

"Lamson, you're a dickhead. "

Terry, you are much too nice to him. In some quarters,

that is considered a compliment. Try the sphincter area

instead, next time.

Jack

[Shanet Clark]

First while I agree that the lack of education is factor, its not because the schools are that bad but rather its the lack of desire by the students. I've seen this first hand. They don't care. The schools are partly to blame, they just pass these kids along rather than keep them back until they actually learn.

I have taught in schools since 1977 and I profoundly disagree with your analysis of the situation. Motivation is a problem but this is not directly the reason why kids from disadvantaged backgrounds fail to do well at school. We have to get things in the right order:

1. Children without the right support from the home begin to struggle with their academic work.

2. They receive low grades, negative comments, are placed in lower sets, etc. To be told you are failing lowers your motivation. This of course reduces motivation and they fall further behind.

The answer to this problem is for the government to take measures that helps to reduce the disadvantages they face in the classroom. Governments have never been willing to do this because it would go down badly with people from advantageous backgrounds. It is this group that applies the most pressure on politicians. In other words, it would be a vote loser. (A large percentage of people from disadvantaged backgrounds do not bother to vote in elections.)

Did I mention our schools are mostly run and staffed by leftists?

Where did you get the idea from? Unfortunately, every school that I have ever taught in has been run and staffed by people with strong conservative attitudes. This is not surprising as everybody in education have achieved academic success by using the existing system. They are therefore slow to see the flaws in the system. For example, most teachers are in favour of streaming or setting. As they have never experienced what it is like to be in a bottom stream, they have little understanding of the negative impact it has on student motivation.

I agree with John on this..............the reproduction of elite advantages ...

is the sociological term for this.

[Craig Lamson]

First while I agree that the lack of education is factor, its not because the schools are that bad but rather its the lack of desire by the students. I've seen this first hand. They don't care. The schools are partly to blame, they just pass these kids along rather than keep them back until they actually learn.

I have taught in schools since 1977 and I profoundly disagree with your analysis of the situation. Motivation is a problem but this is not directly the reason why kids from disadvantaged backgrounds fail to do well at

While I agree that strong family values and support are instrumental, the bottom line is either the kid decides to do the work or they don't. Neither the family nor the government can change that little fact. Nothing creates motivation like failure, and when used properly failure it the BEST method of learning anything. Removing the downide of failure is a mistake. What a terrible way to create adults that will have to compete in the real world that to take away the downside of failure.

Why would helping bad students improve go down badly for the advantaged. The opposite is true. More educated children become more productive adults, which lowers the burdens on the taxpayer and society in the long run.

I my view the ones with little interest in the progress of disadvantaged students are the liberals. After all one of their biggest voting blocks are the disadvantaged and the poor...you know the people to whom these liberals always promise the keys to the national treasury...Boosting them up actually HURTS the liberals.

****************************************************

"Nothing creates motivation like failure, and when used properly failure it the BEST method of learning anything. Removing the downide of failure is a mistake. What a terrible way to create adults that will have to compete in the real world that to take away the downside of failure.

Why would helping bad students improve go down badly for the advantaged. The opposite is true. More educated children become more productive adults, which lowers the burdens on the taxpayer and society in the long run.

I my view the ones with little interest in the progress of disadvantaged students are the liberals. After all one of their biggest voting blocks are the disadvantaged and the poor...you know the people to whom these liberals always promise the keys to the national treasury...Boosting them up actually HURTS the liberals."

SIEG HEIL, Herr Goebbels! I suggest we pack them off on cattle cars and ship them to the ovens and the glue factories. They'd better much better utilized as candles and lampshades, don't you think? Too stupid to become anything else, eh?

Lamson, you're a dickhead.

Another moron UBER leftist checks in. Thanks so much for your opinion, for what ever it is worth.

Quick question Ter...ever learned anything by failure? Ever forget the results?

Terry you are a crackhead!

[John Simkin]

An interesting article in Saturday's Guardian explaining how the MICIC is at work in Iraq:

http://www.guardian.co.uk/international/st...1962229,00.html

Julian Borger in Washington, David Pallister

Saturday December 2, 2006

The Guardian

The Iraqi government is in danger of being brought down by the wholesale smuggling of the nation's oil and other forms of corruption that together represent a "second insurgency", according to a senior US official. Stuart Bowen, who has been in charge of auditing Iraq's faltering reconstruction since 2004, said corruption had reached such levels that it threatened the survival of the state.

"There is a huge smuggling problem. It is the No 1 issue," Mr Bowen told the Guardian. The pipelines that are meant to take the oil north have been blown up, so the only way to export it is by road. "That leaves it vulnerable to smuggling," he said, as truckers sell their cargoes on the black market.

Mr Bowen, the Special Inspector General for Iraq Reconstruction (Sigir), cites Iraqi figures showing that the "virtual pandemic" of corruption costs the country $4bn (£2.02bn) a year, and some of that money goes straight to the Iraqi government's enemies. A US government report has concluded that oil smuggling abetted by corrupt Iraqi officials is netting insurgents $100m a year, helping to make them financially self-sustaining.

"Corruption is the second insurgency, and I use that metaphor to underline the seriousness of this issue," Mr Bowen said. "The deputy prime minister, Barham Saleh, told Sigir this summer that it threatens the state. That speaks for itself."

The Bush administration's strategy in Iraq hinges on the survival of the government run by Nuri al-Maliki, despite US reservations about the prime minister's readiness or ability to confront extremists in his own Shia community.

But Mr Bowen's office has found that the insurgents and militias have also been abetted by US incompetence. A recent audit by his inspectors found that more than 14,000 guns paid for out of US reconstruction funds for Iraqi government use could not be accounted for. Many could be in the hands of insurgents or sectarian death squads, but it will be almost impossible to prove because when the US military handed out the guns it noted the serial numbers of only about 10,000 out of a total of 370,000 US-funded weapons, contrary to defence department regulations.

Jim Mitchell, a Sigir spokesman, said: "The practical effect is that when a weapons cache is found you're deprived of the intelligence of knowing if they were US-provided, which might allow you to follow the trail to the bad guys."

Mr Bowen's inspectors are among the few US civilian officials who still venture beyond the fortified bounds of the Green Zone in Baghdad into the rest of Iraq, to see how $18bn of American taxpayers' money is being spent. Much of the money has been wasted. Sigir officials have referred 25 cases of fraud to the justice department for criminal investigation, four of which have led to convictions, and about 90 more are under investigation.

A culture of waste, incompetence and fraud may be one legacy the occupiers have passed on to Iraq's new rulers more or less intact. Mr Bowen's office found that nearly $9bn in Iraqi oil revenues could not be accounted for. The cash was flown into the country in shrink-wrapped bundles on military transport planes and handed over by the ton to Iraqi ministries by the Coalition Provisional Authority (CPA) run by Paul Bremer, a veteran diplomat. The money was meant to demonstrate the invaders' good intentions and boost the Iraqi economy, which Mr Bremer later insisted had been "dead in the water". But it also fuelled a cycle of corruption left over from Saddam Hussein's rule.

"We know it got to the Iraqis, but we don't know how it was used," Mr Bowen later told Congress.

In the Hillah region a defence department contract employee and two lieutenant colonels were found to have steered $8m in contracts to a US contractor in return for bribes. The Pentagon contract employee, Robert Stein, pleaded guilty earlier this year, admitting he and his co-conspirators received more than $1m in cash, help with laundering the funds, jewellery, cars and sex with prostitutes. Stein also admitted that they simply stole $2m from the construction fund, accounting for the money with receipts from fictitious construction companies.

Hillah just happened to be the district Mr Bowen's inspectors examined in depth. It is still far from clear how much reconstruction money has gone missing around the whole country.

A potentially far more serious problem has been the way the US government decided to give out reconstruction contracts. It split the economy into sectors and shared them out among nine big US corporations. In most cases the contracts were distributed without competition and on a cost-plus basis. In other words the contractors were guaranteed a profit margin calculated as a percentage of their costs, so the higher the costs, the higher the profits. In the rush to get work started the contracts were signed early in 2004. In many cases work did not get under way until the year was nearly over. In the months between, the contractors racked up huge bills on wages, hotel bills and restaurants.

According to a Sigir review published in October, Kellogg, Brown and Root (a subsidiary of Halliburton, Vice President Dick Cheney's former company) was awarded an oil industry repair contract in February 2004 but "direct project activity" did not begin until November 19. In that time KBR's overhead costs were nearly $53m. In fact more than half the company's $300m project costs from 2004-06 went on overheads, the audit found.

Iraq also represented a grey zone beyond the reach of the US civil courts. KBR was found to have overcharged the US military about $60m for fuel deliveries, but that did not stop it winning more government contracts.

A California company, Parsons, had its contract terminated this year after it was found to have finished only six of more than 140 primary healthcare centres it was supposed to build, after two years work and $500m spent. However, the contract was ended "for convenience", meaning Parsons was paid in full. In a police college Parsons built for $75m in Baghdad the plumbing was so bad that urine and excrement rained down from the toilets on to the police cadets. Parsons left a sub-contractor to do repairs but in general there is little punitive action that can be taken for shoddy work.

Part of the reason big US contractors have been able to get away with so much is that there has been limited proper supervision. CPA employees were picked not for their financial expertise but for their political loyalty.

Mr Bowen would have passed the test. He campaigned for George Bush in Texas and was one of the small army of Republican lawyers called in to Florida in 2000 to oversee the vote recounts on Mr Bush's behalf. When he started the job in March 2004 few expected he would do anything to embarrass the administration.

However, Mr Bowen has emerged as the scourge of the big corporations who are among the Republican party's biggest donors. Earlier this year a clause extending his mandate was stripped from a military spending bill just before a vote. Sigir, however, seems to have been saved by the Democratic victory in last month's elections.

Mr Bowen bristles at the suggestion that Mr Bush might have had a hand in the attempt to close his office. "I'm doing exactly what the president expects me to do," he said.

[John Simkin]

So far the Iraq War has cost the United States $400 billion. The final cost to the US, including caring for veterans and replacing equipment, is estimated to amount to $2 trillion. So far the US has obtained $34 billion from oil revenues ($9bn in Iraqi oil revenues cannot be accounted for). The US taxpayer is clearly out of pocket. Then there is the 3,000 military deaths. The only people making from this conflict are Bush's business mates who have got the lucrative supply, service and reconstruction contracts. As a result, Bush has no intention of pulling out of Iraq. His sponsors will not allow him to do this. He is in the same position as LBJ was in during the Vietnam War. General Dynamics, Halliburton, Brown & Root, the Bell Corporation and Ling-Temco-Vought (LTV) laughed all the way to the bank.

http://www.guardian.co.uk/cartoons/stevebe...1967397,00.html

[John Simkin]

In 2002 George McGovern said: "I'm getting sick and tired of old men dreaming up wars for young men to die in."

[Erick A. Bovik]

Dan Briody has just published a book (The Halliburton Agenda) that explains how the Military Industrial Complex works in 2004.

In 1992 Dick Cheney, head of the US Department of Defence, gave a $3.9m contract (a further $5m was added later) to Kellog Brown & Root (KBR), a subsidiary of Halliburton. The contract involved writing a report about how private contractors could help the Pentagon deal with 13 different “hot spots” around the world.

The KBR report remains a classified document. However, the report convinced Cheney to award a umbrella contract to one company to deal with these problems. This contract, which became known as the Logistics Civil Augmentation Programme (Logcap), was of course awarded to KBR. It is an unique contract and is effectively a blank cheque from the government. KBR makes it money from a built in profit percentage. When your profit is a percentage of the cost, the more you spend, the more you make.

KBR’s first task was to go to Somalia as part of Operation Restore Hope. KBR arrived before the US Army. Over the next few months KBR made a profit of $109.7m. In August 1994 KBR made $6.3m in Rwanda. Later that year they received $150m profit from its work in Haiti. KBR made its money from building base camps, supplying troops with food and water, fuel and munitions, cleaning latrines and washing clothes.

The contract came up for renewal in 1997. By this time Cheney had been appointed as CEO of Halliburton. The Clinton administration gave the contract to Dyncorp. The contract came to an end in 2001. Cheney was now back in power and KBR won back the Logcap contract. This time it was granted for ten years. The beauty of this contract is that it does not matter where the US armed forces are in action, the KBR makes money from its activities. However, the longer the troops stay, the more money it makes.

KBR is now busy in Iraq (it also built the detention cells in Guantanamo Bay). What is more Halliburton was given the contract for restoring the Iraqi oil infrastructure (no competitive bid took place).

Cheney sold his stock options in Halliburton for $30m when he became vice president. He claimed he had got rid of all his financial interests in Halliburton. However, the Congressional Research Service (CRS) discovered that he has been receiving yearly sums from Halliburton: $205,298 (2001), $162,392 (2002), etc. They also found he still holds 433,333 unexercised stock options in Halliburton.

My question is: “What does the American public think of this situation?”

For three years now I have read and heard people complaining about Halliburton getting rich off their Kellogg, Brown & Root (KBR) service contract with the US government for Iraq. A quick perusal of Halliburton’s cash flow at Yahoo Finance shows how much they are actually making. In 2003, Halliburton did not make a profit. They had a net loss of 820 million dollars. In 2004, they lost 979 million. In 2005 they made a profit of 2.3 billion. The actual profit from the KBR contract is a very small percentage of Halliburton’s overall profit. The gross revenue from the KBR contract is high, but the overhead expenses eat up most of the profit. In 2005 Halliburton’s gross revenues were 21 billion. For the first 9 months of 2006, KBR’s gross revenues were 7.1 billion, roughly a third of Halliburton’s gross revenues. However, KBR’s net profit for the first nine months of 2006 were a mere $119 million. KBR has been a low-performing subsidiary of Halliburton for quite some time. They would like to sell it but there aren’t any buyers.

[John Simkin]

For three years now I have read and heard people complaining about Halliburton getting rich off their Kellogg, Brown & Root (KBR) service contract with the US government for Iraq. A quick perusal of Halliburton’s cash flow at Yahoo Finance shows how much they are actually making. In 2003, Halliburton did not make a profit. They had a net loss of 820 million dollars. In 2004, they lost 979 million. In 2005 they made a profit of 2.3 billion. The actual profit from the KBR contract is a very small percentage of Halliburton’s overall profit. The gross revenue from the KBR contract is high, but the overhead expenses eat up most of the profit. In 2005 Halliburton’s gross revenues were 21 billion. For the first 9 months of 2006, KBR’s gross revenues were 7.1 billion, roughly a third of Halliburton’s gross revenues. However, KBR’s net profit for the first nine months of 2006 were a mere $119 million. KBR has been a low-performing subsidiary of Halliburton for quite some time. They would like to sell it but there aren’t any buyers.

It is true that corrupt companies are often incompetent and they end up losing a lot of money. In fact, it could be argued that their corruption encourages incompetence. We have had the recent case of Enron but take a look at the accounts of those Texas companies that got billion dollar contracts out of the Vietnam War (General Dynamics, Bell Corporation, Brown & Root, Ling-Temco-Vought). The same is true of the UK’s most corrupt arms dealer, BAE Systems. Before Tony Blair called of the Serious Fraud Office investigation into this company it discovered a £1 billion slush fund. This is one of the reasons that these companies struggle to make profits. The important thing to do is to look at how much money these corrupt businessmen get paid. That is where the money goes. I don’t think the Enron shareholders did very well out of the company’s corrupt activities. The same goes for BAE Systems. One of the reasons why the SFO investigation was called off was because they traced money from the slush fund going back to BAE executives. In time, they would have found evidence of it reaching the politicians and their relatives who arranged the deal.

The real scandal is that as George McGovern said, "old men dream up wars for young men to die in." He could have added that they do it to increase their pension fund. In the long term, George Bush and Tony Blair will, as did Lyndon Johnson before them, will make a fortune from their wars.

[Pat Speer]

Dan Briody has just published a book (The Halliburton Agenda) that explains how the Military Industrial Complex works in 2004.

In 1992 Dick Cheney, head of the US Department of Defence, gave a $3.9m contract (a further $5m was added later) to Kellog Brown & Root (KBR), a subsidiary of Halliburton. The contract involved writing a report about how private contractors could help the Pentagon deal with 13 different “hot spots” around the world.

The KBR report remains a classified document. However, the report convinced Cheney to award a umbrella contract to one company to deal with these problems. This contract, which became known as the Logistics Civil Augmentation Programme (Logcap), was of course awarded to KBR. It is an unique contract and is effectively a blank cheque from the government. KBR makes it money from a built in profit percentage. When your profit is a percentage of the cost, the more you spend, the more you make.

KBR’s first task was to go to Somalia as part of Operation Restore Hope. KBR arrived before the US Army. Over the next few months KBR made a profit of $109.7m. In August 1994 KBR made $6.3m in Rwanda. Later that year they received $150m profit from its work in Haiti. KBR made its money from building base camps, supplying troops with food and water, fuel and munitions, cleaning latrines and washing clothes.

The contract came up for renewal in 1997. By this time Cheney had been appointed as CEO of Halliburton. The Clinton administration gave the contract to Dyncorp. The contract came to an end in 2001. Cheney was now back in power and KBR won back the Logcap contract. This time it was granted for ten years. The beauty of this contract is that it does not matter where the US armed forces are in action, the KBR makes money from its activities. However, the longer the troops stay, the more money it makes.

KBR is now busy in Iraq (it also built the detention cells in Guantanamo Bay). What is more Halliburton was given the contract for restoring the Iraqi oil infrastructure (no competitive bid took place).

Cheney sold his stock options in Halliburton for $30m when he became vice president. He claimed he had got rid of all his financial interests in Halliburton. However, the Congressional Research Service (CRS) discovered that he has been receiving yearly sums from Halliburton: $205,298 (2001), $162,392 (2002), etc. They also found he still holds 433,333 unexercised stock options in Halliburton.

My question is: “What does the American public think of this situation?”

For three years now I have read and heard people complaining about Halliburton getting rich off their Kellogg, Brown & Root (KBR) service contract with the US government for Iraq. A quick perusal of Halliburton’s cash flow at Yahoo Finance shows how much they are actually making. In 2003, Halliburton did not make a profit. They had a net loss of 820 million dollars. In 2004, they lost 979 million. In 2005 they made a profit of 2.3 billion. The actual profit from the KBR contract is a very small percentage of Halliburton’s overall profit. The gross revenue from the KBR contract is high, but the overhead expenses eat up most of the profit. In 2005 Halliburton’s gross revenues were 21 billion. For the first 9 months of 2006, KBR’s gross revenues were 7.1 billion, roughly a third of Halliburton’s gross revenues. However, KBR’s net profit for the first nine months of 2006 were a mere $119 million. KBR has been a low-performing subsidiary of Halliburton for quite some time. They would like to sell it but there aren’t any buyers.

Whatever numbers you are reading, forget 'em. They have no bearing on reality. Remember that Halliburton was found to have over-charged the government by hundreds of millions of dollars, and that this was written off as a misunderstanding without their having to repay the money. There have undoubtedly been some games played with the books. (Seriously, do you think Bush's SEC would ever go after Halliburton?) The real issue is why was Halliburton given a COST-PLUS contract. The Bush Ad said it was because the war came upon us so suddenly that there was no time to take bids. Of course, it came out later that they'd been planning the invasion since 2001. OOOPS. A COST-PLUS contract is a crime against humanity in my opinion. The nature of such a contract guarantees corruption and inefficiency. Many of the Halliburton employees in Iraq make 4-5 times the amount of the serviceman beside them. And yet the more they are paid, the more profit Hallibuirton is guaranteed according to the terms of a COST-PLUS contract. This has been disastrous for American morale. And should be investigated. It would have to be considered more than a coincidence that Cheney's company was awarded a 7 billion dollar cost-plus contract just when it was bleeding money, and that the existence of this contract assured investors of the solvency of the company and its stock value grew as a result. I believe it was no less than the Wall Street Journal that looked into this and found that Cheney made over 20 million on the deal. I'm going on memory here but the whole deal smells BAD, even to the GAO.

Edited December 17, 2006 by Pat Speer

[Erick A. Bovik]

Dan Briody has just published a book (The Halliburton Agenda) that explains how the Military Industrial Complex works in 2004.

In 1992 Dick Cheney, head of the US Department of Defence, gave a $3.9m contract (a further $5m was added later) to Kellog Brown & Root (KBR), a subsidiary of Halliburton. The contract involved writing a report about how private contractors could help the Pentagon deal with 13 different “hot spots” around the world.

The KBR report remains a classified document. However, the report convinced Cheney to award a umbrella contract to one company to deal with these problems. This contract, which became known as the Logistics Civil Augmentation Programme (Logcap), was of course awarded to KBR. It is an unique contract and is effectively a blank cheque from the government. KBR makes it money from a built in profit percentage. When your profit is a percentage of the cost, the more you spend, the more you make.

KBR’s first task was to go to Somalia as part of Operation Restore Hope. KBR arrived before the US Army. Over the next few months KBR made a profit of $109.7m. In August 1994 KBR made $6.3m in Rwanda. Later that year they received $150m profit from its work in Haiti. KBR made its money from building base camps, supplying troops with food and water, fuel and munitions, cleaning latrines and washing clothes.

The contract came up for renewal in 1997. By this time Cheney had been appointed as CEO of Halliburton. The Clinton administration gave the contract to Dyncorp. The contract came to an end in 2001. Cheney was now back in power and KBR won back the Logcap contract. This time it was granted for ten years. The beauty of this contract is that it does not matter where the US armed forces are in action, the KBR makes money from its activities. However, the longer the troops stay, the more money it makes.

KBR is now busy in Iraq (it also built the detention cells in Guantanamo Bay). What is more Halliburton was given the contract for restoring the Iraqi oil infrastructure (no competitive bid took place).

Cheney sold his stock options in Halliburton for $30m when he became vice president. He claimed he had got rid of all his financial interests in Halliburton. However, the Congressional Research Service (CRS) discovered that he has been receiving yearly sums from Halliburton: $205,298 (2001), $162,392 (2002), etc. They also found he still holds 433,333 unexercised stock options in Halliburton.

My question is: “What does the American public think of this situation?”

For three years now I have read and heard people complaining about Halliburton getting rich off their Kellogg, Brown & Root (KBR) service contract with the US government for Iraq. A quick perusal of Halliburton’s cash flow at Yahoo Finance shows how much they are actually making. In 2003, Halliburton did not make a profit. They had a net loss of 820 million dollars. In 2004, they lost 979 million. In 2005 they made a profit of 2.3 billion. The actual profit from the KBR contract is a very small percentage of Halliburton’s overall profit. The gross revenue from the KBR contract is high, but the overhead expenses eat up most of the profit. In 2005 Halliburton’s gross revenues were 21 billion. For the first 9 months of 2006, KBR’s gross revenues were 7.1 billion, roughly a third of Halliburton’s gross revenues. However, KBR’s net profit for the first nine months of 2006 were a mere $119 million. KBR has been a low-performing subsidiary of Halliburton for quite some time. They would like to sell it but there aren’t any buyers.

Whatever numbers you are reading, forget 'em. They have no bearing on reality. Remember that Halliburton was found to have over-charged the government by hundreds of millions of dollars, and that this was written off as a misunderstanding without their having to repay the money. There have undoubtedly been some games played with the books. (Seriously, do you think Bush's SEC would ever go after Halliburton?) The real issue is why was Halliburton given a COST-PLUS contract. The Bush Ad said it was because the war came upon us so suddenly that there was no time to take bids. Of course, it came out later that they'd been planning the invasion since 2001. OOOPS. A COST-PLUS contract is a crime against humanity in my opinion. The nature of such a contract guarantees corruption and inefficiency. Many of the Halliburton employees in Iraq make 4-5 times the amount of the serviceman beside them. And yet the more they are paid, the more profit Hallibuirton is guaranteed according to the terms of a COST-PLUS contract. This has been disastrous for American morale. And should be investigated. It would have to be considered more than a coincidence that Cheney's company was awarded a 7 billion dollar cost-plus contract just when it was bleeding money, and that the existence of this contract assured investors of the solvency of the company and its stock value grew as a result. I believe it was no less than the Wall Street Journal that looked into this and found that Cheney made over 20 million on the deal. I'm going on memory here but the whole deal smells BAD, even to the GAO.

In case anyone should wonder, I do not own stocks or bonds issued by Halliburton, nor have I ever owned any and I don’t know anybody who works for Halliburton.

The no-bid “cost-plus” contract should be quite profitable for Halliburton, especially after the sectarian violence subsides. I’m just guessing here, but I would speculate the no-bid oilfield contract was quid quo pro for taking the unprofitable KBR service contract. The KBR contract did not keep Halliburton afloat as Mr. Speer suggests. They barely turned a profit on it and the overhead was huge.

Ken Lay and Enron were major contributors to the Republican Party. That did not prevent them from being hauled into court. The same could happen to Halliburton officers if they mishandle corporate funds. They are a public corporation and subject to the new Sarbanes-Oxley Act which imposes strict accounting guidelines.

As regards executive compensation, the Halliburton CEO’s salary is 4 million and the other officers earn half or less than that. The CEO of Halliburton’s main competitor, Schlumberger LTD, earns 3.6 million and the other officers earn 1-1.5 million. This range of compensation and the stock options are comparable to what the executives of the mid-size energy company Marathon Oil receive.

I can’t speak for anyone else, but if I were a Halliburton employee and headed for Iraq, and my job was to rebuild oil fields, they would have to pay me A LOT of money to risk getting kidnapped and beheaded. Former U.S. soldiers who served in Iraq are going back there to provide private security to the civilian workers; they are being paid quite richly and deservedly so.

[John Simkin]

The no-bid “cost-plus” contract should be quite profitable for Halliburton, especially after the sectarian violence subsides. I’m just guessing here, but I would speculate the no-bid oilfield contract was quid quo pro for taking the unprofitable KBR service contract. The KBR contract did not keep Halliburton afloat as Mr. Speer suggests. They barely turned a profit on it and the overhead was huge.

This is the contract I was talking about. In 1992 Dick Cheney, head of the US Department of Defence, gave a $3.9m contract (a further $5m was added later) to Kellog Brown & Root (KBR), a subsidiary of Halliburton. The contract involved writing a report about how private contractors could help the Pentagon deal with 13 different “hot spots” around the world.

The KBR report remains a classified document. However, the report convinced Cheney to award a umbrella contract to one company to deal with these problems. This contract, which became known as the Logistics Civil Augmentation Programme (Logcap), was of course awarded to KBR. It is an unique contract and is effectively a blank cheque from the government. KBR makes it money from a built in profit percentage. When your profit is a percentage of the cost, the more you spend, the more you make.

KBR’s first task was to go to Somalia as part of Operation Restore Hope. KBR arrived before the US Army. Over the next few months KBR made a profit of $109.7m. In August 1994 KBR made $6.3m in Rwanda. Later that year they received $150m profit from its work in Haiti. KBR made its money from building base camps, supplying troops with food and water, fuel and munitions, cleaning latrines and washing clothes.

The contract came up for renewal in 1997. By this time Cheney had been appointed as CEO of Halliburton. The Clinton administration gave the contract to Dyncorp. The contract came to an end in 2001. Cheney was now back in power and KBR won back the Logcap contract. This time it was granted for ten years. The beauty of this contract is that it does not matter where the US armed forces are in action, the KBR makes money from its activities. However, the longer the troops stay, the more money it makes.

KBR is now busy in Iraq (it also built the detention cells in Guantanamo Bay). What is more Halliburton was given the contract for restoring the Iraqi oil infrastructure (no competitive bid took place).

Cheney sold his stock options in Halliburton for $30m when he became vice president. He claimed he had got rid of all his financial interests in Halliburton. However, the Congressional Research Service (CRS) discovered that he has been receiving yearly sums from Halliburton: $205,298 (2001), $162,392 (2002), etc. They also found he still holds 433,333 unexercised stock options in Halliburton.

[Dawn Meredith]

For three years now I have read and heard people The real scandal is that as George McGovern said, "old men dream up wars for young men to die in." He could have added that they do it to increase their pension fund. In the long term, George Bush and Tony Blair will, as did Lyndon Johnson before them, will make a fortune from their wars.

I could not agree more. George is still the most decent man ever to run for president (notwithstanding the Kennedy brothers).

Interesting discussion here guys. Stranger yet- I agree with John and Pat's words rather than my husband Erick's re the money made off the immoral, evil war in Iraq. Like many married couples we simply agree to disagree on this entire issue.

Dawn