Arms And The Man
Who's Making A Killing On Killing In Iraq?

Friday, January 30, 2004  

NYTimes Columnist Bob Herbert:


by Bob Herbert

"NEW YORK Can you spell Halliburton? R-i-p-o-f-f. War-torn Iraq has been a gold mine for Halliburton, yet another treasure trove of U.S. taxpayer dollars for a company that has no peer in the fine art of extracting riches from the government.

"But if you go through some of Halliburton's filings with the Securities and Exchange Commission over the past several years, as I have, you'll see a company that goes to great lengths - literally to the ends of the earth - to escape paying its fair share of taxes to the government that has been so good to it.

"Annual reports filed with the SEC since the mid-90's - when Dick Cheney took over as chief executive and wrote the game plan for garnering government goodies - showed Halliburton subsidiaries incorporated in such places as the Cayman Islands, Bermuda, Trinidad and Tobago, Panama, Liechtenstein, and Vanuatu.

"Vanuatu? Who knew? Vanuatu is a mountainous group of islands in the South Pacific. Its people support themselves mostly by fishing and subsistence farming. "Additional revenues," according to the Columbia Encyclopedia, "derive from a growing tourist industry and the development of Vila (the capital) as a corporate tax shelter."

"Halliburton, in an SEC filing in 2000, duly noted that it had a subsidiary incorporated in Vanuatu called Kinhill Kramer (Vanuatu) Ltd. The company adamantly denies that its offshore subsidiaries are used to shift income out of the United States. But it's indisputable that somebody is doing a dandy job of limiting Halliburton's tax liability. When I asked how much Halliburton paid in federal income taxes last year, a company spokeswoman, Wendy Hall, said, "After foreign tax credit utilization, we paid just over $15 million to the IRS for our 2002 tax liability." That is effectively no money at all to an empire like Halliburton. Less than pocket change. Dick Cheney must be having a good laugh over the way his old company, following his road map, is taking the United States for such a ride...." [more]

posted by Major Barbara | 8:31 PM

Thursday, January 29, 2004  



"Oil refineries in western Europe have suffered a severe shortage of oil because Russian exports through the Bosphorus Strait have been drastically reduced in recent days. Turkish authorities say they have cut back traffic through the narrow waterway from the Black Sea to the Mediterranean because of bad weather and enforcement of strict regulations governing oil traffic. Really? Foreign Report has another explanation.

"The strait is considered to be one of the world's most dangerous waterways when there is bad weather, and the Turks are paranoid about collisions involving tankers that could cause explosions in the heavily populated areas around Istanbul. But European oil sources suspect that the slowdown imposed on Russian oil exports through the strait is part of an effort by the Turkish government to reduce such traffic over time because it will compete with the US-backed pipeline being laid from the oilfields outside Baku in Azerbaijan, through Tbilisi, Georgia, to Turkey's loading terminal at Ceyhan on the Mediterranean.

"The US$2.9bn, 1,760km pipeline, known as the BTC, is intended to be the main conduit for Caspian Sea oil to western Europe, cutting Russian and Iranian influence in the energy-rich Caspian. Due for completion in 2005, the pipeline being built by a consortium led by British oil giant BP will pump up to one million barrels per day (bpd).

"In late January, at least nine large oil tankers had been waiting for weeks to enter the Black Sea to lift some 370,000 tonnes of Russian oil for export, according to officials at the port of Odessa. They said authorities had been forced to cut shipment from 1.8 million tonnes to 300,000 tonnes over the previous month after the Turks imposed strict regulations on transits to avoid possible accidents in the Bosphorus. Bad weather and increased traffic are forcing delays for about 100 vessels waiting to enter the strait.

"The bloodless revolution in Georgia, where work began on a section of the pipeline in May, has produced a staunchly pro-Western government following the ousting of Eduard Shevardnadze on 23 November, blocking Russian efforts to impose its will in the former Soviet republic and take control of its bankrupt economy. Georgia is of huge strategic importance to the West and Russia, because it straddles the planned oil route...." [more]

* * *

Thanks to Marshall for the link!

posted by Major Barbara | 8:02 PM

Wednesday, January 28, 2004  



The Associated Press

"BAGHDAD, Iraq - The privatization of Iraq's state-run oil industry has faded as a priority for U.S. officials advising the Iraqi Oil Ministry, despite enthusiastic support for the idea among some American conservatives in the months leading up to the war.

"Iraqi opposition to privatization, together with the Oil Ministry's success in ratcheting up its production of crude - to more than 2.3 million barrels a day from almost nothing last June, has eased the pressure for a radical restructuring of Iraq's most important industry.

"However, Iraqi oil officials are eager to cooperate with foreign companies to find and exploit new sources of crude, and they hope by this autumn to announce their first rules for foreign investment.

"U.S. oil advisers and their Iraqi counterparts, speaking to The Associated Press in recent interviews, said they are focusing for now on the immediate goals of boosting Iraq's crude output to prewar levels and securing its oil facilities and pipelines against sabotage.

"Oil is Iraq's most valuable export, and Iraqis need to produce all they can of it to rebuild their country. Wars, mismanagement and 12 years of U.N. sanctions devastated the economy, and looters pillaged much of what was left after Saddam Hussein's ouster last April. Iraq, once home to the Arab world's largest middle class, now has no national phone network. Its hospitals lack medicines, and the capital, Baghdad, suffers lengthy power outages each day.

"U.S.-led occupation forces plan to transfer political control to the Iraqis on June 30. Iraqis must move gradually after that if they decide to dismember and sell off their petroleum industry, said Robert McKee, the U.S.-appointed senior adviser to the Oil Ministry

""They have to be realistic. It's probably unlikely that they are, on Day One, going to privatize the oil industry. They may get to that eventually, but I think they'll have to begin with a state-controlled industry. That makes the most sense" he said.

"An eventual sell-off of oil assets would most likely be confined to "downstream" businesses such as refining and distribution, he added, echoing earlier comments from Iraq's Oil Minister Ibrahim Bahr al-Uloum.

"Before and immediately after the war, some conservative American analysts and Bush administration members advocated privatization of the entire Iraqi oil industry. They argued that independent companies could run the industry more efficiently than any government and could better attract investment.

""Even the U.S. has lost interest, mainly because the Iraqis themselves are so 'anti.' It's a nationalistic thing," Leo Drollas, chief economist at the Center for Global Energy Studies, said from the center's London office...." [more]

posted by Major Barbara | 4:53 PM


Military tanker deal brings probes

By Stephen J. Hedges
Washington Bureau

"WASHINGTON -- Fifteen months ago, the struggling Boeing Co.'s ambitious plan for a $17billion revenue boost was stuck deep in a Washington quagmire.

"The aerospace giant wanted to lease to the Pentagon 100 of its 767 airliners modified as aerial refueling tankers, and it had won over the Air Force and key members of Congress.

"That's usually enough to seal a defense deal. But one person--a pencil-pushing former Capitol Hill staffer turned-pharmaceutical executive turned-White House accountant--didn't like Boeing's idea. Not one bit.

"Mitch Daniels, then President Bush's budget director and now the Republican candidate for Indiana governor, thought the tanker deal violated government accounting rules.

""The central problem was that the tankers were not on [the] Defense Department's wish list until somebody [at Boeing] came up with this idea," an administration source said.

"Faced with Daniels' objections, Boeing did what only a handful of American businesses can do: It went over Daniels' head and straight to Bush. Through a series of meetings among the president and his staff and key members of Congress--including House Speaker Dennis Hastert (R-Ill.)--Boeing applied enough pressure at the top to push its contract through in May.

"Today, however, those hardball tactics have backfired. The lobbying campaign is the subject of criminal, congressional and Pentagon investigations...." [more]

posted by Major Barbara | 4:49 PM

Tuesday, January 27, 2004  




"Halliburton Co. doesn't plan to submit a bid for new contracts to transport fuel into Iraq, the company's chief executive officer said Monday.

"The fuel-importing work that Halliburton subsidiary KBR has done has drawn great public scrutiny. The Pentagon's Defense Contract Audit Agency has raised concerns about whether the company may have overcharged the government as much as $61 million for trucking fuel into the country for civilian use. That work was being done as part of a larger contract with the U.S. Army Corps of Engineers for work in Iraq's oil sector that had been awarded without competition.

"But the corps put work to be done in Iraq's oil sector out for bid, and Halliburton, earlier this month, was awarded a contract valued at $1.2 billion to retrofit refineries, repair pipelines and boost oil production in southern Iraq.

"However, a different federal agency, the Defense Energy Support Center, was assigned to take over responsibilities for importing fuel for Iraq's civilians, and it has put that work out for competitive bids.

"Halliburton will not try to win that work, said CEO Dave Lesar, who spoke via conference call to the Chronicle's editorial board Monday.

""We have said all along that we were willing to give up that contract as soon as an alternative provider could be found," he said, stressing that Halliburton took on the mission because it was critical to making sure the Iraqi people had sufficient fuel.

""It is a dangerous mission and one that we particularly wanted to move onto another contractor," he said, adding that it was always temporary and Halliburton had told the military all along the company didn't want to do it for the long run...." [more]

posted by Major Barbara | 7:05 AM

Monday, January 26, 2004  

Center For American Progress "Talking Points":


"We now have a clear admission of guilt from Halliburton that the company knowingly defrauded the American people in its handling of post-war Iraqi reconstruction efforts. After months of accusing critics of trying to score political points with Halliburton, the public learned that it was the vice president’s former company that has been scoring more than just political advantage from the country – Halliburton recently admitted that two employees received $6 million kickbacks in return for awarding a Kuwaiti-based company with lucrative work supplying U.S. troops in Iraq.

"Halliburton has continually ripped off the American public. The kickback scheme comes on top of the company’s repeated efforts to bilk American taxpayers and corner billions in reconstruction grants. From no-bid contracts with little scrutiny to allegedly manipulated gasoline prices, Halliburton’s largely secretive and unchecked rein over post-war Iraq has been anything but above board.

"The administration’s claims about Halliburton should be heavily scrutinized given its track record with the truth in Iraq. Vice President Cheney said last week, that despite Halliburton’s admission of guilt, "allegations of corruption stem from 'desperate' political opponents who 'can't find any legitimate policy differences' to debate." The vice president also asserted last week, "We've found a couple of semi-trailers at this point which we believe were in fact part of [a WMD] program. I would deem that conclusive evidence, if you will, that he did in fact have programs for weapons of mass destruction," – a claim former CIA weapons inspector David Kay called "premature and embarrassing." Given the vice president’s on-going ties to his former company and his pattern of deception with Iraq, the public should remain highly vigilant in monitoring the administration’s comments on Halliburton.

"Congress should follow the lead of Rep. Henry Waxman who has called for a full investigation of Halliburton’s role in Iraq. Given the rapid time table in Iraq, taxpayers must be assured that they are not being forced to pay a company that willfully violates American laws and undermines confidence in our reconstruction efforts. If a full investigation turns up additional evidence of fraud and collusion from Halliburton, the company’s monolithic hold on reconstruction grants should be broken up and distributed to competitors who can keep our trust."

posted by Major Barbara | 5:26 PM



By Sue Pleming

"WASHINGTON (Reuters) - Anxious to defend more than $8 billion in work for the U.S. military in Iraq, oil services firm Halliburton has launched an ad campaign to counter negative publicity over corruption and cronyism allegations.

"The Texas company, run by Vice President Dick Cheney until 2000, kicked off its TV advertisements as it revealed last week that one or two of its employees may have taken kickbacks from a Kuwaiti subcontractor supplying U.S. troops in Iraq.

"News of the possible kickbacks piled more pressure onto the company, particularly in Congress where Senate Democratic leader Tom Daschle of South Dakota urged no new contracts be granted to Halliburton until any doubts have been "resolved." Other Democrats called for hearings.

"Halliburton spokeswoman Wendy Hall said on Monday the company, which is the U.S. military's biggest contractor in Iraq, had decided to counter negative publicity with an ad campaign highlighting its dangerous work supporting troops.

""Halliburton gets beaten up every day by people who don't have the facts. We can stand the heat, but we will tell our story," said Hall in an e-mail response to questions.

"Using the slogan, "Halliburton, proud to serve our troops,," the ads show what the company does in Iraq, from serving food and doing laundry to setting up phone centers for homesick soldiers.

"In one shot, a uniformed soldier is seen on the telephone, tearfully announcing the birth of a child: "It's a girl."

"Hall declined to say how much the campaign was costing the company or how long it would last...." [more]

posted by Major Barbara | 5:21 PM

Sunday, January 25, 2004  



By Hannah Allam
Knight Ridder Newspapers

"KIRKUK, Iraq - Iraq's oldest and largest oilfields stretch across black hills and emerald valleys, through ancient settlements and all the way to a horizon broken only by wells straining for every drop of the nation's lifeblood.

"These vast northern fields could bring in billions of dollars to help rebuild the economy. But the multiethnic community once bound by oil is unraveling, as Kurds, Arabs and Turkmens rush to claim Kirkuk. If Kurds follow through on plans to add the city to autonomous territory, there could be disastrous results for the other ethnic groups that for years have been the backbone of local oil production.

"The tension in Kirkuk suggests huge obstacles for U.S. plans to pull back from Iraq, leaving the country whole and at peace.

"Many local residents and oil officials are worried that ethnic conflict may divide Kirkuk's workforce, lead to widespread violence and invite devastating attacks on the struggling postwar oil infrastructure, which has been hit by frequent sabotage and theft.

"The prize in Kirkuk is about 113 billion barrels in possible reserves, which engineers believe lie under the city and are roughly the equivalent to the already proven reserves of the entire oil-rich country.

"Yasin al Hadidi, 56, a patriarch in one of the city's oldest Arab families, said his father worked the Kirkuk fields for three decades, often lugging barrels of oil by mule until a citywide alarm sounded to announce the end of a day's work. The multiethnic neighborhoods that flourished around the fields are now threatened by Kurds who want to break away and take oil revenues with them, al Hadidi said.

""Before there were little bubbles of tension. Now it's boiling," he said, sitting at home in a district named after his family. "I hope and pray the oil stays in good hands, maybe in the hands of the central government. But even if the Kurds take over, where am I going to go? This is my city. This is our work."

"The coalition seized the oilfields during the war but quickly relinquished oversight to the new Oil Ministry under Iraq's interim government. International export is slowly resuming, and engineers are working overtime to correct the sabotage, theft, outdated equipment and other obstacles that prevent Kirkuk's oil output from reaching prewar levels.

"But recent eruptions of ethnic violence in northern Iraq raise questions as to whether the central control of the fields will last. The city's oil wealth would ensure the long-term viability of an autonomous Kurdish state. That makes rival Arab and Turkmen groups nervous...." [more]

posted by Major Barbara | 7:04 AM

Friday, January 23, 2004  



By MATT KELLEY, Associated Press Writer

"WASHINGTON - Halliburton has fired employees who allegedly took kickbacks from a Kuwaiti subcontractor helping to supply U.S. troops in Iraq (news - web sites), the company said.

"Spokeswoman Wendy Hall said Friday the company reported the "irregularities" to Pentagon (news - web sites) auditors and criminal investigators.

""We found it quickly, and we immediately reported it," Hall said in a statement. "We do not tolerate this kind of behavior by anyone at any level in any Halliburton company."

"The Wall Street Journal reported Friday that two employees of Halliburton subsidiary KBR accepted up to $6 million in kickbacks from the unnamed Kuwaiti firm. Hall said the company could not discuss specifics of the charges.

"The kickback allegations involve KBR's contract to supply U.S. Army troops in Iraq, not its separate contract to rebuild Iraqi oil facilities and deliver gasoline to civilians. Pentagon auditors are seeking a criminal probe into findings that KBR and Kuwaiti firm Altanmia Marketing Co. overcharged by $61 million for fuel deliveries.

"Halliburton, Vice President Dick Cheney (news - web sites)'s former company, has denied overcharging on that contract.

"The Pentagon's inspector general's office, which is investigating both allegations, declined comment Friday.

"Friday's disclosure is the first admission by Halliburton that its employees were involved in possible corruption involving Iraq contracts.

"Halliburton disclosed last year that another KBR employee paid more than $2 million in bribes to a Nigerian official to get favorable tax treatment. A French judge investigating a KBR joint venture in Nigeria with a French firm has reportedly warned that Cheney, who headed Halliburton from 1995 until 2000, could be subject to criminal charges in France. Cheney has denied any wrongdoing.

"Democrats on Friday renewed their criticism of Halliburton and their demands for further investigations into the company's contracts.

""All of Halliburton's contracts with the government need to be terminated," said Sen. Frank Lautenberg, D-N.J. "This is a fatal blow to the company's credibility and the administration's ability to defend these contracts."..." [more]

posted by Major Barbara | 9:01 AM

Dow Jones:


"WASHINGTON -- Halliburton Co. has told the Pentagon that two employees took kickbacks valued at up to $6 million in return for awarding a Kuwaiti-based company with lucrative work supplying U.S. troops in Iraq , Friday's Wall Street Journal reported.

"The disclosure is the first firm indication of corruption involving U.S.- funded projects in Iraq and raises new questions about Halliburton's dealings there. The company's work already is being scrutinized because of accusations that the U.S. government was overcharged for gasoline under another controversial contract.

"Halliburton has strenuously defended its Iraq work as fairly priced and free of taint. A discovery of kickbacks could expose the company to hefty fines and other punishments such as potential fraud charges. At the least, contracting experts say, Halliburton will be required to reimburse the money...." [more]

posted by Major Barbara | 12:38 AM

Thursday, January 22, 2004  



By F. Brinley Bruton

"LONDON (Reuters) - British firms will stand a better chance of winning contracts to help rebuild Iraq once more funding for such projects comes from outside the United States, a government minister has said.

""The best way forward is for there to be more diversity in terms of funding, including Iraq's own resources, and then there will be wider opportunities for (UK) companies to be involved," Brian Wilson, the prime minister's special representative for trade and reconstruction in Iraq, told Reuters.

"His comments follow news last Friday that Britain's largest engineering services firm Amec failed, in joint venture with Fluor of the United States, to win a U.S. contract worth up to $1.2 billion (650 million pounds) to refurbish Iraq's oil industry.

"Two contracts to rebuild Iraqi oilfields worth a total of $2 billion went to a unit of U.S. Vice President Dick Cheney's old firm, Halliburton, and U.S. construction giant Parsons which teamed up with Worley Group of Australia.

"While many in Britain had expected Amec to win one contract, Wilson said the decision was not entirely surprising.

""Everybody understands the rules of engagement and it is not easy for non-U.S. companies to succeed at that level of contract," said Wilson, who this week led a British trade mission to Kuwait to attend an Iraq reconstruction conference...." [more]

posted by Major Barbara | 7:42 AM

Wednesday, January 21, 2004  

Southern Exposure:


"DURHAM, N.C. – January 21 - A team of investigative reporters in Iraq have uncovered a pattern of waste and abuse among U.S. companies receiving multi-billion-dollar “reconstruction” contracts in the country, including massive over-charges for projects; shoddy work or a failure to complete tasks; and ignoring local experts who contend they could do the job better and cheaper.

"The in-depth report by Pratap Chatterjee and Herbert Docena, published in the latest issue of Southern Exposure magazine (, is one of the first on-the-ground accounts of how U.S. taxpayer money given to Bechtel, Halliburton and other companies is being spent.

"The investigative team spent three weeks in Iraq visiting project sites, analyzing contracts, and interviewing dozens of administrators, contract workers, and U.S. officials. Among the findings:

"Despite over eight months of work and billions of dollars spent, key pieces of Iraq’s infrastructure – power plants, telephone exchanges, and sewage and sanitation systems – have either not been repaired, or have been fixed so poorly that they don’t function.

"San Francisco-based Bechtel has been given tens of millions of dollars to repair Iraq’s schools. Yet many haven’t been touched, and several schools that Bechtel claims to have repaired are in shambles. One “repaired” school was overflowing with unflushed sewage; a teacher at the school also reported that “the American contractors took away our Japanese fans and replaced them with Syrian fans that don’t work” – billing the U.S. government for the work.

"Inflated overhead costs and a byzantine maze of sub-contracts have left little money for the everyday workers carrying out projects. In one contract for police operations, Iraqi guards received only 10% of the money allotted for their salaries; Indian cooks for Halliburton subsidiary Kellogg, Brown & Root reported making just three dollars a day.

"The report also reveals further details of Halliburton’s contracts: for example, that of Halliburton’s $2.2 billion in contracts, only about 10% has gone to meeting community needs – the rest being spent on servicing U.S. troops and rebuilding oil pipelines. Halliburton has also spent over $40 million in the unsuccessful search for weapons of mass destruction.

"“A handful of well-connected corporations are making a killing off the devastation in Iraq” observes Chris Kromm, publisher of Southern Exposure. “The politics and process behind these deals have always been questionable. Now we have first-hand evidence that they’re not even doing their jobs...." [more]

posted by Major Barbara | 8:48 PM


By Steven Rosenfeld

"Forget Halliburton. The vice president's former company may keep getting the headlines for its hefty contracts in Iraq and Pentagon overcharging, but it's not the private company that's so badly botched the training of the new Iraqi Army that the Jordanian Army has been hastily brought in to finish the job.

"That firm is Vinnell Corp. of Alexandria, Va., owned by politically connected Northrop-Grumman. Its errors in training a new Iraqi Army have undermined the creation of one of the most important institutions in a post-Saddam Iraq—a national army, senior American intelligence and military analysts say.

"The big risk is the failure to rapidly reconstitute a competent new Iraqi Army may create a scenario akin to Afghanistan, where the countryside is dominated by rival militias and the reach of the central government—and its nascent military—is marginal at best. Add to that election year politics in the United States, where there will be pressure to withdraw some American forces, and the outlook on the ground in Iraq is increasingly volatile.

"With Congress approving $87 billion for the occupation, could Vinnell's $48 million contract really be that critical? The answer is yes, according to former senior CIA and Defense Intelligence Agency officers and think tank experts on military contracting. Experts all say Vinnell's assignment far outweighed its monetary value.

""This whole thing is just nuts," said a retired Defense Intelligence Agency officer long based in the region. "All you had to do was take a Special Forces battalion based at Ft. Bragg and train the Iraqi Army. They do it one unit a time...Instead, we have created a potential for civil war."..." [more]

posted by Major Barbara | 8:44 PM

UN Observer Analysis:


by Chalmers Johnson

"As distinct from other peoples, most Americans do not recognize -- or do not want to recognize -- that the United States dominates the world through its military power. Due to government secrecy, our citizens are often ignorant of the fact that our garrisons encircle the planet. This vast network of American bases on every continent except Antarctica actually constitutes a new form of empire -- an empire of bases with its own geography not likely to be taught in any high school geography class. Without grasping the dimensions of this globe-girdling Baseworld, one can't begin to understand the size and nature of our imperial aspirations or the degree to which a new kind of militarism is undermining our constitutional order.

"Our military deploys well over half a million soldiers, spies, technicians, teachers, dependents, and civilian contractors in other nations. To dominate the oceans and seas of the world, we are creating some thirteen naval task forces built around aircraft carriers whose names sum up our martial heritage -- Kitty Hawk, Constellation, Enterprise, John F. Kennedy, Nimitz, Dwight D. Eisenhower, Carl Vinson, Theodore Roosevelt, Abraham Lincoln, George Washington, John C. Stennis, Harry S. Truman, and Ronald Reagan. We operate numerous secret bases outside our territory to monitor what the people of the world, including our own citizens, are saying, faxing, or e-mailing to one another.

"Our installations abroad bring profits to civilian industries, which design and manufacture weapons for the armed forces or, like the now well-publicized Kellogg, Brown & Root company, a subsidiary of the Halliburton Corporation of Houston, undertake contract services to build and maintain our far-flung outposts. One task of such contractors is to keep uniformed members of the imperium housed in comfortable quarters, well fed, amused, and supplied with enjoyable, affordable vacation facilities. Whole sectors of the American economy have come to rely on the military for sales. On the eve of our second war on Iraq, for example, while the Defense Department was ordering up an extra ration of cruise missiles and depleted-uranium armor-piercing tank shells, it also acquired 273,000 bottles of Native Tan sunblock, almost triple its 1999 order and undoubtedly a boon to the supplier, Control Supply Company of Tulsa, Oklahoma, and its subcontractor, Sun Fun Products of Daytona Beach, Florida...." [more]

posted by Major Barbara | 7:38 AM

SanFranChron Commentary:


David Lazarus

"You may have noticed that Halliburton, Vice President Dick Cheney's former company, received another $1.2 billion contract the other day to help rebuild Iraq's oil industry. The firm's commitments in Iraq are now valued at more than $5 billion.

"Less well known is the role private contractors are playing on the security front, participating alongside troops in combat and peacekeeping duties.

"An investigation last month by the British newspaper the Guardian revealed that private companies are now the second-biggest U.S. coalition partner in Iraq. There are now at least 10,000 private military contractors on the ground, compared with about 9,900 British troops.

"We are, it turns out, outsourcing the war.

""It's a sea change," said Peter Singer, a national-security analyst at the Brookings Institution and author of "Corporate Warriors," which charts the rise of the private sector in modern warfare.

""The war in Iraq has taken an existing trend to stunning new levels," he said. "We now have an industry that, in less than a decade, is making more than $100 billion in revenues a year."

"Roughly a third of the $87 billion to be spent by the United States this year in Iraq and Afghanistan has been earmarked for private companies. Much of that cash will go toward rebuilding infrastructure and providing logistical support for troops.

"But a significant portion -- solid figures are hard to come by -- will fund training of Iraqi soldiers and police by private contractors, and security operations at strategic sites by private guns-for-hire.

"Corporate forces are routinely placed in harm's way in Iraq and have exchanged fire with Iraqi combatants. They kill when necessary. And they get killed.

"On Sunday, one private contractor, Vinnell, a subsidiary of defense giant Northrop Grumman, anticipated calls from anxious relatives after a suicide bomber in Baghdad killed at least 20 people outside a facility where many security companies have their offices.

""All employees are accounted for and are OK," Vinnell said in a recorded message. The company received a $48 million contract in 2002 to help train a new-and-improved Iraqi military.

"U.S. officials say there have been hundreds of attacks on private contractors in Iraq since the country was invaded last March. Of this number, several dozen contractors have been killed or injured. A more detailed breakdown of casualties is not available.

""They're not being counted against the ledger," Singer noted. "Contractors aren't factored in when figures are given for troops killed or injured in Iraq. There's no official accounting of this. Almost everything we know about them comes from the few stories that get told and a lot of rumors."

Firefights have been reported between private military contractors and Iraqi rebels. The Washington Times quoted an unnamed former special forces member, now working as a gun-for-hire in Baghdad, as saying that contractors have shot and killed Iraqis trying to loot government buildings.

"It's Iraq," the contractor was quoted as saying. "You're accountable to nobody."..." [more]

posted by Major Barbara | 7:26 AM

Tuesday, January 20, 2004  


Those worried that America might be slinking towards imperialism miss the point: America already has an empire.

By Chalmers Johnson

"As distinct from other peoples, most Americans do not recognize -- or do not want to recognize -- that the United States dominates the world through its military power. Due to government secrecy, our citizens are often ignorant of the fact that our garrisons encircle the planet. This vast network of American bases actually constitutes a new form of empire -- an empire with a unique geography unlikely to be taught in any high school classroom.

"Without grasping the dimensions of this globe-girdling Baseworld, one can't begin to understand the size and nature of our imperial aspirations, or the degree to which a new kind of militarism is undermining our constitutional order. Militarism and imperialism are Siamese twins joined at the hip; each thrives off the other. Already highly advanced in our country, they are both on the verge of a quantum leap that will almost surely stretch our military beyond its capabilities, bringing about fiscal insolvency and very possibly doing mortal damage to our republican institutions. Unfortunately, the only way this is discussed in our press is via reportage on highly arcane plans for changes in basing policy and the positioning of troops abroad. And these plans, as reported in the media, cannot be taken at face value. As a result, it’s almost impossible to assess the size, real value, or proposed reach of our empire of bases.

"Official records on these subjects are misleading, although instructive. According to the Defense Department's annual "Base Structure Report" for fiscal year 2003, which itemizes foreign and domestic U.S. military real estate, the Pentagon currently owns or rents 702 overseas bases in about 130 countries and HAS another 6,000 bases in the United States and its territories. Pentagon bureaucrats calculate that it would require at least $113.2 billion to replace just the foreign bases -- surely far too low a figure but still larger than the gross domestic product of most countries -- and an estimated $591,519.8 million to replace all of them. The military high command deploys to our overseas bases some 253,288 uniformed personnel, plus an equal number of dependents and Department of Defense civilian officials, and employs an additional 44,446 locally hired foreigners. The Pentagon claims that these bases contain 44,870 barracks, hangars, hospitals, and other buildings, which it owns, and that it leases 4,844 more. These numbers, although staggeringly large, do not begin to cover all the actual bases we occupy globally. The 2003 Base Status Report fails to mention, for instance, any garrisons in Kosovo -- even though it is the site of the huge Camp Bondsteel, built in 1999 and maintained ever since by the Halliburton subsidiary Kellogg, Brown & Root. The Report similarly omits bases in Afghanistan, Iraq, Israel, Kuwait, Kyrgyzstan, Qatar, and Uzbekistan, although the U.S. military has established colossal base structures throughout the so-called arc of instability in the two-and-a-half years since 9/11...." [more]

posted by Major Barbara | 5:43 PM

Sunday, January 18, 2004  



By Matt Kelley, Associated Press Writer

"WASHINGTON — Despite a Pentagon probe into alleged overcharging for fuel delivered to Iraq, the Army awarded Vice President Dick Cheney's former company a contract Friday to rebuild Iraq's oil industry.

"Halliburton won a competitive bid to rebuild the oil industry in southern Iraq, a contract worth up to $1.2 billion over two years, the Army Corps of Engineers said in a statement.

"The Army gave Halliburton subsidiary KBR a no-bid contract to rebuild oil infrastructure throughout Iraq shortly after the U.S.-led invasion of Iraq last March. The Army opened that contract for competitive bids last fall and split it into one for northern Iraq and one for southern Iraq.

"The northern Iraq contract, worth up to $800 million, went to a joint venture of California-based Parsons Corp. and the Australian firm Worley Group Ltd...." [more]

posted by Major Barbara | 9:06 PM

Dow Jones:


"SYDNEY (Dow Jones)--Australia's Worley Group Ltd. (WOR.AU) said Monday that a joint venture in which it has a 35% stake has been awarded a contract worth up to US$800 million to restore Iraq oil infrastructure.

"The ultimate size of the contract from the U.S. Army Corps of Engineers will depend on "conditions on the ground at the time, and may or may not reach the contract maximum," it said. The contract has a minimum value of US$500,000.

"Worley's partners in the joint venture are Pasadena-based Parsons Corp. with 20% and Houston-based Parsons E&C with 45%.

"The contract covers services such as extinguishing oil well fires, environmental and oil infrastructure condition assessments, engineering design, oilfield, pipeline and refinery maintenance, procurement and importation of fuel products and distribution of fuel, among other things...." [more]

posted by Major Barbara | 9:00 PM

Tuesday, January 13, 2004  

Houston Chronicle:



"WASHINGTON -- The U.S. Army Corps of Engineers has awarded Houston-based Halliburton Co. another lucrative contract, this time for up to $1.5 billion of design and construction work over the next five years.

"Ignoring critics suspicious of Halliburton's ties to the Pentagon, the corps has selected Halliburton as one of 10 contractors hired to support U.S. military operations, other federal agencies and even friendly governments anywhere in the U.S. Central Command's area of operations, a 25-country swath extending from the Horn of Africa to Central Asia.

"Halliburton subsidiary KBR, formerly known as Kellogg Brown & Root, will bid for as yet unspecified assignments to be rolled out over the next several years.

"Halliburton and the other contractors will be limited to $500 million worth of work this year and then another $250 million annually during the next four years. The 10 firms or teams will be guaranteed at least $500,000 of work each year...." [more]

posted by Major Barbara | 11:00 PM



"AMMAN - Countries that supported the war to topple Saddam Hussein would to be given preference for contracts to develop Iraqi oilfields, the Iraqi oil minister indicated on Monday.

"Ibrahim Bahr al-Oloum made the remarks in an interview with the London-based Arabic daily "Asharq al-Aswat" apparently referring to his ministry's intention to award contracts to US allies.

"He said that he also expected Iraq to reach the pre-war crude oil output of 2.8 million barrels per day (bpd) at the end of March.

""The Oil Ministry is currently evaluating the contracts for the development of Iraqi oilfields which were concluded by the deposed regime," the minister said.

""We will focus on the interest of the Iraqi people so as to pay attention to the political attitudes of countries ... we will have reservations on countries which did not extend a hand to the people of Iraq," he added...." [more]

* * *



By Loring Wirbel & Robert Keenan ,

"Washington -- The Defense Information Systems Agency has approved the recommended subcontractors chosen by Science Applications International Corp. (SAIC) for the Global Information Grid Bandwidth Expansion project, an optical terrestrial network that is to deliver Internet Protocol traffic among defense and intelligence locations worldwide.

"Contracts went to Ciena Corp. for its CoreStream optical transport system and to Juniper Networks Inc. for its M- and T-router IP/MPLS systems. The team of Sycamore Networks Inc. and Sprint Communications Co. will provide an optical digital cross-connect solution, while the team of Cisco Systems Inc. and Qwest Communications International Inc. was chosen for the multiservice provisioning platform.

"The Global Information Grid is the Pentagon's unified IP network of communication systems for defense and intelligence needs, including integrated systems for national security, such as upgrades to the Secret IP Router Network and to the Proteus asynchronous transfer network...." [more]

posted by Major Barbara | 9:59 AM


Fuel Averted Crisis, General Says

By Jackie Spinner
Washington Post Staff Writer

"KANDAHAR, Afghanistan -- The commander of the U.S. Army Corps of Engineers said his decision to allow a Halliburton Co. subsidiary to continue to import fuel from Kuwait to Iraq after Pentagon auditors found possible overcharging was necessary to avert a brewing crisis.

"Oil-rich Iraq has had to import fuel because of continued attacks on its pipelines and refineries since the U.S.-led war that toppled Saddam Hussein. "I don't think people understand the environment we're working in," Lt. Gen. Robert B. Flowers said in an interview during a visit to Iraq and Afghanistan.

"The Halliburton subsidiary, KBR Inc., won an emergency no-bid contract to help rebuild Iraq in March, and some Democratic members of Congress have criticized the company and the Corps of Engineers for it. Dick Cheney ran Halliburton before he became vice president.

"Last month Defense Department auditors outside the Corps said KBR may have overcharged the government $61 million by paying too high a price to a Kuwaiti subcontractor. KBR has denied gouging the government, saying that the Corps had directed it to buy the fuel from Kuwait and that it found its supplier through a competitive selection.

"Flowers said a gasoline shortage in Iraq originally led him to ask KBR to find an immediate source in Kuwait. A week after the audit finding, he said, he signed a waiver letting the American company continue using the Kuwaiti subcontractor.

""If I didn't do that there would be no way you could come close to meeting demand," Flower said. "Bad things would happen."..." [more]

posted by Major Barbara | 5:37 AM

Monday, January 12, 2004  

Harris Corp. Also to Operate National Newspaper

By Walter Pincus
Washington Post Staff Writer

"The Pentagon has awarded a $96 million contract to a U.S. communications equipment maker to run Saddam Hussein's old television and radio network, now called al-Iraqiya, for the next 12 months, the chairman of the company said last week.

"Harris Corp., based in Melbourne, Fla., will operate the national newspaper formerly run by Hussein's son Uday, in addition to running the broadcast network, said Howard L. Lance, chairman of the company.

"When Hussein's government fell in April, the state-run broadcast stations and newspaper were seized. In the months since, they have been run by a U.S. defense contractor, Science Applications International Corp. (SAIC).

"Under SAIC direction, the stations have not drawn viewers and listeners because their content was considered too pro-United States. In addition, there has been turnover in the non-Iraqi management and turmoil within the Iraqi staff, many of whom were holdovers from the previous dispensation. The day before Hussein was captured last month, 30 Iraqi reporters and producers were fired, and al-Iraqiya did not get the news of his arrest on the air for almost 24 hours.

"Lance said last week he and two partners hope soon "to have up and running a high-quality news and entertainment network."

"The partners are the Lebanese Broadcasting Corp. (LBC) and a Kuwaiti publishing and telecommunications company, Al-Fawares. Harris will manage the project and supply the equipment. LBC will be the source of the electronic programming and will conduct training.

"Running the newspaper and training its journalists will be handled by Al-Fawares, which publishes a newspaper in Kuwait and prints Newsweek in Arabic.

"Although the Pentagon contract runs for a year, there is some question about what will happen to the newspaper and stations -- collectively known as the Iraq Media Network (IMN) -- when the Coalition Provisional Authority turns over sovereignty to a new Iraq government, scheduled for July 1. Lance said last week he did not know what was going to happen, but he pledged to make the network a "high-quality" organization, whether it becomes state-run or remains under Pentagon control after July...." [more]

posted by Major Barbara | 6:16 AM



"NEW YORK (Reuters) - The Defense Department has launched an inquiry into high-level military officials who have taken jobs at defense contractors over the past few years, prompted by ethical problems at Boeing Co., the Wall Street Journal said on Monday.

"Citing people familiar with the matter, the paper said the probe is expected to focus on Boeing first and then expand quickly to the hiring practices of other big military suppliers.

"The inquiry stems from Boeing's firing of Michael Sears as chief financial officer in November for violating company policy by discussing a job offer with Darleen Druyun, who served as the Air Force's No. 2 acquisition official before joining the company in January. She was also let go, before she had recused herself from Boeing-related negotiations.

"Investigators are seeking to determine whether dozens of other Defense Department officials complied with federal requirements to refrain from participating in certain program decisions both before and after moving to the private sector, the paper said, citing people familiar with the details...." [more]

posted by Major Barbara | 6:09 AM



By Nicolas Pelham in Amman and Demetri Sevastopulo in Washington

"The US-led administration in Iraq on Sunday promised logistical and media support for a trade fair in Baghdad in March, hailing the event as "Iraq's grand opening".

"Announcement of the trade fair, to be called Destination Baghdad Export, came at a conference in the Jordanian capital Amman. It was sponsored by the US Department of Commerce and attracted hundreds of potential investors.

"A 250-strong delegation from the American-Iraqi Chamber of Commerce in Baghdad expressed anger at having to beat a path to Jordan to establish contacts with the US-led administration ruling Iraq.

""It takes two months to see the Americans at the palace," said Adil al-Rawi, a Baghdad merchant, referring to the Coalition Provisional Authority headquarters in one of Saddam Hussein's former palaces in the Iraqi capital.

"Complaining he had failed to win any contracts under US-led rule, Mr Rawi said: "There's no information in Iraq."

"The Iraqi delegates voiced their anger on the sidelines of the conference during a meeting with retired US admiral David Nash, the Baghdad-based director of the Iraq Infrastructure Reconstruction Organisation, who is responsible for disbursing more than $18bn (€15bn, £10bn) of US funding for reconstruction.

"The US reconstruction effort has been criticised for alleged cronyism in awarding contracts to US companies, including Halliburton and Bechtel, and for delays in awarding contracts to rebuild the war-torn country. The US government is also investigating how mobile telephone licences were awarded following allegations of improprieties in the bidding process.

"At the Amman conference, Iraqis denounced organisers for failing to provide Arabic translators and for not including Iraqis on the panel. "They are speaking as if Iraqis are not there," said Ahmed al-Haider of Al Belouj company. "Iraqis must have a role."

"Songool Chapak, the only visible member of the Iraqi Governing Council, said she had been invited by the Dutch delegation, not the Americans, and had had to hire a taxi to make the 1,000km trip by road to Amman...." [more]

posted by Major Barbara | 6:05 AM

Sunday, January 11, 2004  

LATimes Commentary:

Four generations of the dynasty have chased profits through cozy ties with Mideast leaders, spinning webs of conflicts of interest

By Kevin Phillips

"WASHINGTON — Dynasties in American politics are dangerous. We saw it with the Kennedys, we may well see it with the Clintons and we're certainly seeing it with the Bushes. Between now and the November election, it's crucial that Americans come to understand how four generations of the current president's family have embroiled the United States in the Middle East through CIA connections, arms shipments, rogue banks, inherited war policies and personal financial links.

"As early as 1964, George H.W. Bush, running for the U.S. Senate from Texas, was labeled by incumbent Democrat Ralph Yarborough as a hireling of the sheik of Kuwait, for whom Bush's company drilled offshore oil wells. Over the four decades since then, the ever-reaching Bushes have emerged as the first U.S. political clan to thoroughly entangle themselves with Middle Eastern royal families and oil money. The family even has links to the Bin Ladens — though not to family black sheep Osama bin Laden — going back to the 1970s.

"How these unusual relationships helped bring about 9/11 and then distorted the U.S. response to Islamic terrorism requires thinking of the Bush family as a dynasty. The two Bush presidencies are inextricably linked by that dynasty...." [more]

posted by Major Barbara | 7:30 AM

Saturday, January 10, 2004  



by Larry Margasak

"WASHINGTON (AP) -- Pentagon auditors spent 1,139 hours altering their own files in order to pass an internal review, say investigators who found that the accounting sleuths engaged in just the kind of wasteful activity they are supposed to expose.

"When the auditors in the New York City office learned well in advance which files a review team would check, they spent the equivalent of more than 47 days doctoring the papers and updating records from several audits, the Defense Department's inspector general concluded. Administrative staff, audit supervisors and other employees also participated in the scheme.

"The fabrication at the Defense Contract Audit Agency "certainly violates the spirit and intent" of government auditing standards and rules on ethical conduct, according to the inspector general's report obtained by The Associated Press.

"The fabrication was discovered in 2001, but the report on it was not disclosed until Tuesday.

"The defense agency, which audits government contracts, is the same one that recently reported that Vice President Dick Cheney's former company, Halliburton, may have overcharged the Army as much as $61 million for gasoline in Iraq...." [more]

posted by Major Barbara | 10:03 PM

Friday, January 09, 2004  



"AMMAN - Nine months after the fall of Saddam Hussein's regime, manufacturers from more than 20 countries will gather in Jordan on Sunday to be updated on the task of rebuilding Iraq's war-battered economy and infrastructure.
Outreach 2004 is the latest in a long line of conferences devoted to rebuilding Iraq and hosted by Jordan, the tiny desert kingdom that has emerged as a gateway for businessmen heading to Iraq because of its proximity to Baghdad.

"The three-day conference, to be held from Sunday to Tuesday, is sponsored by the US Department of Commerce. It will include workshops and an exhibition featuring pavilions from Arab and Western firms.

""There are billions and billions of dollars still needed and still being planned for the reconstruction of Iraq," the organisers, US-based trade fair management firm, Kallman Group, said in a statement on its website.

""The US Department of Commerce realises this and has put the full support of the American government behind Outreach 2004 — a US-led international exhibition and workshop programme," it said.

""The conference program will focus on updating US and other businessmen on the first eight months of activity in Iraq and will prepare them for a role as subcontractors of vitally needed equipment and services," it added.

"Representatives from Bechtel and Halliburton - two giant US firms who control the lion's share of contracts for rebuilding Iraq - will attend the event "to present their requirements for subcontractors and partners," organisers said.

"The head of the US-led coalition's procurement department, Colonel Tony Bell, will participate in one of the workshops devoted to the "hows and whys" of contracting.

"Speakers at the opening session will include William Lash, assistant secretary of commerce and chairman of the Iraq Reconstruction Task Force, and Retired US admiral David Nash, director of the Iraq Infrastructure Reconstruction Organisation...." [more]

posted by Major Barbara | 9:32 AM

Thursday, January 08, 2004  

USA Today:


James Cox

"The Bush administration sought bids Wednesday for $5 billion of rebuilding work in Iraq, saying it will pick winners by March and will stand by a ban on bidders from countries that opposed the war.

"The Pentagon office handling Iraqi reconstruction spelled out terms for 10 construction projects and seven project-management contracts. Congress last fall appropriated $18.6 billion for projects in Iraq. The administration intends to award contracts for $13 billion in 2004 and $6 billion in 2005.

"The jobs put out for bid include refurbishing Iraq's power facilities, water and sanitation systems, public buildings, roads and communications network. They include improving Iraqi defense forces, courts and security facilities.

"Tuesday, the first in a new round of contracts went to San Francisco-based Bechtel, selected secretly in the spring for $680 million in infrastructure repairs and engineering assessments.

"Bechtel's second contract, awarded by the U.S. Agency for International Development, is for $1.8 billion to rebuild power facilities, water and wastewater systems, ports and airports, railways and roads, and public buildings.

"The Pentagon said bidders in the new round will be judged on technical expertise, management qualifications, past performance and cost. But the non-cost factors combined ''are significantly more important'' than cost...." [more]

posted by Major Barbara | 8:29 AM

Wednesday, January 07, 2004  

Government mega-contractor SAIC is back in the news today, working a couple of angles on the growing information market: "identity recognition" and "information dominance."

Back in the day, this stuff merited simpler descriptives, like "Big Brother" and "propaganda."

* * *


SRD Software Raises the Bar on Identity Recognition

"LAS VEGAS, Jan. 7 /PRNewswire/ -- SRD Software, the leading provider of
software solutions that extend identity recognition beyond 360 degrees, today
announced the immediate availability of a new release of ERIK identity
recognition software, formally known as SI Warehouse. This release increases
precision and enhances ease of use with new expanded integration capabilities
and configuration and management tools.

"ERIK extends the customer and citizen data integration (CDI) capabilities
of commercial and government applications by expanding individual recognition
efforts beyond a traditional 360-degree view. An integrated view of an
individual is critical as the basis for success of any knowledge-based
application, but still remains a major technical challenge for most

"About SRD Software
SRD Software provides identity recognition software to commercial and
government customers needing customer and citizen insight that goes beyond the
traditional 360-degree view.
SRD's solutions are based on its proprietary
Entity Resolution(TM) technology. Entity Resolution is the result of 20 years
of research and development and extends user insight beyond existing customer
and citizen data integration technologies by incorporating the non-obvious
relationship dimension into the integration process. SRD has received
investment funding from Reed Elsevier Ventures, SAIC Venture Capital
Corporations and In-Q-Tel.
For more information about SRD, visit"

* * *

SAIC Venture Capital's portfolio page doesn't list SRD.

Next, more about SAIC, from The Guardian...

* * *

Guardian Analysis:

Since the beginning of the war in Iraq, the US has sought not just to influence but to control all information, from both friend and foe

David Miller

""Information dominance" came of age during the conflict in Iraq. It is a little discussed but highly significant part of the US government strategy of "full spectrum dominance", integrating propaganda and news media into the military command structure more fundamentally than ever before.

"In the past, propaganda involved managing the media. Information dominance, by contrast, sees little distinction between command and control systems, propaganda and journalism. They are all types of "weaponized information" to be deployed. As strategic expert Colonel Kenneth Allard noted, the 2003 attack on Iraq "will be remembered as a conflict in which information fully took its place as a weapon of war"....

"Achieving information dominance according to American military experts, involves two components: first, "building up and protecting friendly information; and degrading information received by your adversary". Seen in this context, embedding journalists in Iraq was a clear means of building up "friendly" information. An MoD-commissioned commercial analysis of the print output produced by embeds shows that 90% of their reporting was either "positive or neutral".

The second component is "the ability to deny, degrade, destroy and/or effectively blind enemy capabilities". "Unfriendly" information must be targeted. This is perhaps best illustrated by the attack on al-Jazeera's office in Kabul in 2001, which the Pentagon justified by claiming al-Qaida activity in the al-Jazeera office. As it turned out, this referred to broadcast interviews with Taliban officials. The various attacks on al-Jazeera in Kabul, Basra and Baghdad should also be seen in this context.

"The new TV service for Iraq was paid for by the Pentagon. In keeping with the philosophy of information dominance it was supplied, not by an independent news organisation, but by a defence contractor, Scientific Applications International Corporation (SAIC). Its expertise in the area - according to its website - is in "information operations" and "information dominance".

The SAIC effort ran into trouble. The Iraqi exile journalists it employed for the Iraq Media Network (at a cost $20m over three months) were too independent for the Coalition Provisional Authority. Within weeks, occupying authority chief Paul Bremer introduced controls on the IMN. He also closed down some Iraqi-run newspapers and radio and TV stations. According to Index on Censorship, IMN managers were told to drop the readings from the Koran, the vox-pops (usually critical of the US invasion) and even to run their content past the wife of a US-friendly Iraqi Kurdish leader for a pre-broadcast check. The station rejected the demands.

But this did not stop Bremer, and further incidents culminated in a nine-point list of "prohibited activity" issued in June 2003. Bremer would reserve the power to advise the IMN on any aspect of its performance, including matters of content and the power to hire and fire staff. Thus, as Index on Censorship notes: "The man in absolute authority over the country's largest, richest and best-equipped media network is also his own regulator and regulator of his rivals, with recourse to the US Army to enforce his rulings."..." [more]

posted by Major Barbara | 8:56 PM




"WASHINGTON - A partnership of giant companies with ties to U.S. officials has been awarded a $1.8 billion Iraq reconstruction contract, the government said Tuesday.

"The Bush administration also announced plans to open bidding on an additional $5 billion in Iraq reconstruction work.

"But Pentagon and State Department officials acknowledged they had not worked out a bureaucratic squabble over which agency would ultimately oversee more than $18 billion in reconstruction funding approved by Congress last fall.

"The team of Bechtel National Inc. and Parsons Corp. won the deal for major reconstruction projects in Iraq, said Gordon West of the State Department's U.S. Agency for International Development. The two California firms will be responsible for rebuilding Iraq's electricity and water systems, as well as roads and schools, West said.

"Bechtel already has a similar reconstruction contract with USAID, which could be worth up to $680 million by the end of next year. That contract, unlike the latest one, was not awarded through competitive bidding.

"Bechtel executives gave thousands of dollars to President Bush's 2000 campaign, and two of the company's top executives serve on advisory boards for the White House and Pentagon.

"Democrats have criticized Bechtel's no-bid contract, calling it an example of Bush administration cronyism. Administration officials say politics has had nothing to do with decisions to award contracts. West said the Bechtel-Parsons partnership beat bids from two other firms, which he was legally barred from naming.

"Separately, Parsons has an $89 million contract with the U.S. military to oversee disposal of Iraqi munitions at three sites. The company also has teamed with Bechtel to build facilities for the Army to dispose of large portions of the U.S. chemical weapons arsenal.

"Last September, Parsons announced it had hired two former top Energy Department officials to help the company land Energy Department contracts. Parsons also hired a recently retired Air Force major general to work in its defense contracts operation...." [more]

* * *


By Sue Pleming

"WASHINGTON (Reuters) - The United States opened up bidding Wednesday for $5 billion in new contracts to rebuild Iraq, the first in a string of lucrative deals funded by $18.6 billion appropriated by Congress for Iraq's reconstruction.

"After more than a month's delay, the Pentagon-run Program Management Office kicked off bidding by issuing solicitations overnight for 17 major construction contracts and project management deals to oversee the work.

"The Pentagon promised open competition for the deals, but the bidding for prime contracts excludes companies from nations that did not support the U.S. decision to invade Iraq without U.N. approval, including France, Russia, Germany and Canada.

"The United States has drawn up a list of 63 eligible countries but says the list could be revised and other nations included. Sub-contracts will be open to all nations...." [more]

posted by Major Barbara | 8:10 AM


Pentagon Plans to Spend More As Transfer of Power Nears

By Mary Pat Flaherty
Washington Post Staff Writer

"Bechtel National Inc. yesterday was awarded a $1.8 billion contract for more reconstruction work in Iraq, while the Defense Department announced plans for seeking $5 billion more in rebuilding contracts.

"The flurry of activity comes as agencies leading the rebuilding effort continue to adjust to shifting political and security conditions in Iraq, which already have caused a month-long delay in seeking proposals from contractors.

"The White House decision to transfer sovereignty to Iraq by June 30 prompted adjustments in spending plans, Pentagon and State Department officials said. Contracts worth $4.6 billion for reconstruction will be deferred until after the transfer of power to give the Bush administration more "flexibility" in its responses to needs that Iraqi officials identify, said Larry DiRita, chief Pentagon spokesman...." [more]

posted by Major Barbara | 8:05 AM

Tuesday, January 06, 2004  



Associated Press Writer

"WASHINGTON -- The Army has allowed Halliburton to increase the supplies of fuel delivered to Iraq without giving the usual data to justify its cost, a spokesman said Tuesday.

"The December action by the Army Corps of Engineers does not exonerate Vice President Dick Cheney's former company in a dispute with the Pentagon over fuel prices, Army corps spokesman Ross Adkins said Tuesday.

"But the decision does mean that Halliburton subsidiary KBR does not have to provide price figures for the increased flow of gasoline and kerosene it buys in Kuwait and delivers to Iraqi civilian markets, Adkins said. He said Halliburton's Kuwaiti supplier, the Altanmia Marketing Co., refused to provide the price data required under U.S. contracting regulations.

"Altanmia is the only company authorized by the Kuwaiti government to sell fuel for delivery in Iraq.

"Pentagon auditors have said KBR may have overcharged the Army by $67 million for fuel it bought from Altanmia and delivered into Iraq between April and October. The Kuwaiti price was more than $1 per gallon more than fuel KBR bought in Turkey.

"Halliburton has said it had no choice but to pay what Altanmia charged. The company said it saved the Pentagon more than $100 million by suggesting shipping fuel at a lower price from Turkey, which now provides about two-thirds of the gasoline sold in Iraq...." [more]

* * *



"A senior US army officer has cleared the American engineering company Halliburton of any wrongdoing in relation to a contract to deliver fuel from Kuwait to Iraq, according to a newspaper report.

"The Wall Street Journal says that the commander of the Army Corps of Engineers, Lieutenant General Robert Flowers, has exonerated the company's subsidiary Kellogg Brown & Root after Defense Department officials complained that the government had been overcharged by $100m.

"The newspaper reports that more junior officers told General Flowers that the company had provided data to show that fuel was delivered at a fair and reasonable price...." [more]

posted by Major Barbara | 8:01 AM

Monday, January 05, 2004  

Gulf Daily News (Bahrain):


"KUWAIT CITY: Kuwait has sold fuel to the US military in Iraq based on contracts with the US government at market prices, the emirate's energy minister said yesterday, denying reports that it was sold at inflated prices.

""Kuwait Petroleum Corp (KPC) has been supplying oil products to Iraq based on contracts with the US administration at international market prices," Shaikh Ahmad Fahd Al Sabah told the official Kuna news agency.

"The role of KPC, the state-owned oil giant, and the Kuwaiti government is "limited to supplying the US party who signed the contract with fuel at market prices without playing any other role," the minister said.

"Pentagon officials, quoted by US media, said there was no link between the change and accusations that a Halliburton subsidiary, Kellog, Brown and Root (KBR), may have overcharged for fuel by $61 million.

"Halliburton, which used to be run by US Vice-President Dick Cheney, has strongly denied the allegations. An investigation into the accounts is still being carried out.

"According to the preliminary audit by Defence Department investigators, KBR charged $2.27 a gallon of petrol delivered to Iraq. A similar contract from Turkey would have cost $1.18 a gallon...." [more]

posted by Major Barbara | 12:21 AM

Saturday, January 03, 2004  

Straits Times Editorial:



"NEW HAVEN (Connecticut) - The instability of post-war Iraq has turned private military services into a booming cottage industry. The coalition authorities have awarded private companies contracts to provide a plethora of security services, like protecting oil sites and training Iraqi security forces - a special priority for the Bush administration if it is to pull United States troops out by next summer.

"Private military companies (PMCs) have also found a lucrative market in post-war Afghanistan. However, this widening use of private military organisations presents new practical and ethical challenges that have to be addressed before they get out of control.

"The PMCs' visibly important role in the world's 'hot spots' lends weight to the notion that the nation-state is losing its jealously guarded monopoly on the use of force - or, in some cases, voluntarily relegating it to the private sector.

"Private companies are coming to the fore, adopting the role of more than modern-day mercenaries....

"The companies the US and its allies have hired - like Kroll, Armor, Control Risks, Rubicon and Global Risk - boast of a whole range of specialisations and hail from a range of countries but, together, they provide all the services normally carried out by national military forces, including intelligence, military training, logistics and security.

"In addition to becoming an integral part of the machinery of war, they are emerging as cogs in the infrastructure of peace. US-allied military officials and civilians in Iraq and Afghanistan are quickly becoming familiar with the 'brand services' provided by companies...." [more]

posted by Major Barbara | 7:08 AM

Friday, January 02, 2004  


Cisco, the preeminent router-maker in the computer biz, just got spanked by Juniper Networks -- who snatched away a big chunk of government business.

Here's what Cisco learned the hard way: Want to land those enormous government subcontracts for equipment mandated under new cyber-security laws?

Then it can't hurt to grease the palm of Richard Clarke as the head of your "federal systems advisory board"!

You see, not all that long ago Clarke was appointed by President Bush to be the Special Adviser for Cyberspace Security within the National Security Council.

The job lasted just long enough to propel Clarke through the fabled revolving door. He adroitly landed a gig as "Chairman, Juniper Federal Systems Advisory Board."

And -- by coincidence! -- Juniper just hit the goldmine, threatening to displace mighty Cisco as the government's chief source of routers.

Courtesy of government mega-contractor SAIC, which has fed its own revolving door with the likes of David Kay ....

* * *

IDG News:

The project involves upgrading a global communications network for the U.S. military

Story by Stephen Lawson

"JANUARY 02, 2004 ( IDG NEWS SERVICE ) - The agency upgrading a global communications network for the U.S. military has approved plans by contractor Science Applications International Corp. (SAIC) that would bring in six major subcontractors to supply the equipment underlying the network.
Through its Global Information Grid Bandwidth Expansion (GIG-BE) project, the U.S. Defense Information Systems Agency (DISA) plans to enhance the Defense Information System Network with greater bandwidth and more physically diverse routes at about 90 sites in the continental U.S. and the European and Pacific theaters. When the project is finished, most of the sites will be served by an optical mesh network, according to information on the Web site of DISA, based in Arlington, Va.

"The agency announced Tuesday that it has accepted San Diego-based SAIC for the project. SAIC will subcontract with Ciena Corp. for optical transport system equipment, with Sprint Corp. and Sycamore Networks Inc. for optical digital cross-connect gear, and with Cisco Systems Inc. and Qwest Communications International Inc. unit Qwest Government Services for multiservice provisioning platforms.

"For IP routers, the contractor found that Juniper Networks Inc. in Sunnyvale, Calif., offered the technical solution with the best value, according to a DISA statement.

"Dubhe Beinhorn, vice president of Juniper Federal Systems in Herndon, Va., portrayed Juniper's selection as a breakthrough in its competition with Cisco, which holds the lion's share of the router business worldwide.

""The government is ready for a choice in IP routing. ... Cisco has had a significant incumbent position with the government for the last 10 years," Beinhorn said...." [more]

posted by Major Barbara | 5:51 PM



by Aram Roston

"David Horgan opposed the war on Iraq, but in other ways he is an antiwar protester's worst nightmare: The oil executive freely admits that he is in the bombed-out country "for greed and glory." His goal is a mammoth oil deal for the small Irish company he works for, Petrel Resources. Still, amid the shooting and kidnappings and chaos, the wiry 43-year-old Irishman says he will be satisfied with even crumbs. "A crumb in Iraq," he says eagerly, eyes widening, "would be hundreds of millions of dollars at present value. It is high risk, in every sense, but it is an excellent play."

"Horgan is no newcomer to Iraq and to this particular "play." He dealt with the administration of Saddam Hussein and he is willing to do business with whoever comes next, even a US puppet, as he believes it will be. "We'll deal with the puppet," he said one day at the Baghdad Sheraton, as a group of Nepalese Gurkha warriors clomped past loaded with body armor and high-tech rifles. "Any puppet will have exactly the same objectives and worries. His first priority is to get the oil flowing." That may sound cynical, but at least it sounds honest-which is more, as Horgan points out, than the Bush Administration can say about its justification for invading Iraq.

"A little time with Horgan in Baghdad opens up a window on one of the most important but confusing elements of postwar Iraq: the upcoming battle for control of its vast oil reserves. Before the war, US Defense Secretary Donald Rumsfeld famously announced that this war had "literally nothing to do with oil," while antiwar protesters chanted "no blood for oil," in the streets. Since then there has been very much blood, and surprisingly little oil. New exploration of Iraq's untapped fields is at a virtual standstill; the repair of the old fields has been notoriously slow. A little- known statistic: according to international oil traders, the United States is currently importing 500,000 barrels of Iraqi oil per day (a type of oil charmingly called "Basrah Light"), down from more than 700,000 per day last February, before the war started...." [more]

posted by Major Barbara | 11:00 AM



By Sue Pleming

"WASHINGTON (Reuters) - The U.S. military says it will soon take over Halliburton's role of getting fuel into Iraq, a decision that follows a draft Pentagon audit that found Vice President Dick Cheney's old firm may have overcharged for the job.

"The Pentagon's Defense Energy Support Center said on Wednesday it had expanded its traditional mandate of providing fuel to the U.S. military and would now be responsible for importing and distributing fuel products to the Iraqi people.

""This is the first time our agency has been given this kind of work," said DESC spokeswoman Lynette Ebberts, who declined to comment on whether the DESC was taking the work because of price gouging allegations against Halliburton...." [more]

posted by Major Barbara | 7:14 AM

Thursday, January 01, 2004  



By Sue Pleming

"WASHINGTON (Reuters) - Following a month of delays and bickering over who can bid for $18.6 billion in rebuilding work in Iraq, the Pentagon is expected to open up bidding on a slew of contracts next week, officials said on Wednesday.

"The first wave of formal solicitations is set to be rolled out possibly as early as Monday -- a month after first promised -- and is likely to cover about $5 billion in construction projects, said a U.S. government official close to the bidding process who asked not to be named.

"Another $6 billion in non-construction contracts will likely be rolled out in a second wave of solicitations. All of the work will be advertised via the main U.S. government procurement web site

"Funding for the work comes from $18.6 billion appropriated by Congress for Iraq and tenders have been consistently delayed while lawyers and politicians worked out the fine print of the proposals and responded to thousands of queries over drafts.

"Aside from the money from Congress, tens of billions of dollars more will be available from U.S. government funds and international donors to rebuild Iraq, and the bulk of this is expected to go to private contractors.

"Officials said prime contracts from the $18.6 billion would likely still be limited to firms from countries that helped in the war effort, in line with a Pentagon decision that was met with anger by opponents of the war such as France and Germany...." [more]

posted by Major Barbara | 7:34 AM