Lead Story March 17, 2004 Vol. 1 No. 6
By Richard Muhammad
(Editor's Note: This week's lead story is an updated version of a Special Report published on StraightWords E-Zine last week.)
Already battered by a congressional hearing, questions about record keeping and possible overbilling of contract costs, falling stock prices and a Justice Department probe, Halliburton, a major war contractor, was hit with criticism from the top military official in Iraq.
Halliburton’s fuzzy timetable for consolidating bases into fewer, but larger operations made troop rotations tougher and late payments to food service companies are a problem, complained Lt. Gen. Ricardo Sanchez, in a letter reported on March 15 by the Wall Street Journal and picked up by other media outlets.
Houston-based Halliburton has been given billions of dollars in Pentagon contracts to handle things like base building, laundry and meals for troops in Iraq and Afghanistan. Vice President Dick Cheney is a former Halliburton CEO. The company had previously maintained the Army was happy with its performance.
“We knew this before this was a story,” said Nancy Lessin, of Military Families Speak Out, an organization of people opposed to war in Iraq and who have relatives or loved ones in the military, in a March 17 phone interview. Families have been sending food to soldiers in Iraq and have been told of problems with construction of shelter, filthy mess halls and other failures by private contractors, she said.
“Our kids are dying for Halliburton and Bechtel and it’s illegal, it’s immoral, and it has to end,” she said.
With the March 20 one-year anniversary of the Iraq war, many groups plan protests at the offices of firms like Halliburton, Boeing and Bechtel that are making huge amounts of money off of the military excursion.
Privitazation gone wild?
During a March 11 House Committee on Government Reform hearing, Pentagon officials admitted a contract with a firm hired by Halliburton had been canceled, but then reinstated because of a shortage of gasoline in Iraq. The same firm had been accused of overcharging the military for gasoline. Halliburton was also given a $1.2 billion oil contract by the Army Corp of Engineers despite the firm’s admission that two employees took millions of dollars in kickbacks, officials said. Since the self-confessed charges had not been proven, the contract was approved, officials said.
Auditors for the Pentagon found problems with how Halliburton-subsidiary KBR negotiated and was charged by subcontractors. A report from the auditors released at the hearing said KBR, formerly known as Kellogg Brown & Root Inc., could not substantiate charges it billed to the U.S. government. KBR is the largest U.S. military contractor in Iraq, and its contracts could top off at about $18 billion, observers say.
Military auditors “identified significant deficiencies in KBR's estimating practices related to the award of subcontract costs,” admitted Pentagon Comptroller Dov Zakheim, referring to analysis by the Defense Contract Audit Agency, a financial watchdog agency. One official said the problem was a lack of documentation and clarity on how bids and charges for work were handled. Halliburton will withhold $176.5 million in billing for food while KBR responds to DCAA questions.
“Contractor performance in Iraq has been neither perfect, but is was not terrible,” Zakheim said.
Rep. Henry Waxman (D-Calif.) wasn’t so kind. “Instead of promoting competition, the administration is giving huge monopolies over huge sectors of the reconstruction effort. One company – Halliburton – gets all the work related to oil reconstruction in southern Iraq, and another company – Parson – gets all work related to oil construction in northern Iraq. And they have never had to bid against each other for any specific project,” said Rep. Waxman.
“The problems are compounded by the fact that many of the contracts that are being issued are ‘cost plus’ contracts. Under a cost-plus contract, the more the contractor bills, the more money the contractor makes,” he observed.
The leading committee Democrat accused the White House of “shielding contractors from competition.” Defense Department officials charged with oversight of the contracts are inexperienced and overwhelmed, Rep. Waxman said. He also released a memo that detailed millions of dollars in billing discrepancies.
Government probes or window dressing?
The Pentagon opened a criminal investigation late last month into the fuel contract and has asked the Justice Department for an investigation.
Justice Department involvement likely means the Pentagon feels more serious activity and violations have occurred that warrant more serious charges, said Bill Hartung, a senior research fellow at the World Policy Institute. Hartung co-authored a recent report on huge increases in war contracting with Frida Berrigan, deputy director of the institute’s Arms Project. Hartung is also author of “How Much Are You Making On The War Daddy? A Quick and Dirty Guide to War Profiteering in the Bush Administration.”
That probe will bear watching, given that it’s in the hands of Attorney General John Ashcroft and the question is how far the probe will go, Hartung said. If Halliburton was prosecuted and found guilty under the False Claims Act, punishments could entail fines triple the amount of stolen money, though company execs wouldn’t do jail time, he said.
According to Hartung’s analysis, Halliburton’s prime contracts with the Pentagon jumped almost 700 percent, from $483 million in fiscal year 2002 to $3.9 billion in fiscal year 2003. That does not include the $1.2 billion contract to rebuild oil infrastructure in southern Iraq approved amid concern about wrongdoing.
The Justice Department investigation needs to go much deeper than just Halliburton and should cover all contractors, Hartung argued. By his count, the Pentagon’s “Big Three,” Lockheed Martin, Boeing and Northrop Gruman split $50 billion in contracts in 2003. That’s on top of the Pentagon’s annual $400 billion budget and at least $180 billion spent on Iraq and Afghanistan, he added.
Pressure needs to be ratcheted up to keep government officials digging into wartime military contracting, Hartung said. “The Bush folks may realize they have to do something,” he said. “Letting Halliburton off scott free is not good politics.”
Unless contracts are pulled from companies that gouge taxpayers and a hard look is taken at the incestuous relationship between contractors and Defense Department officials, a single probe won’t do much good, Frida Berrigan argues.
The problem requires more than “window dressing, appeasing members of Congress who made the hearings happen and appeasing the public,” she said. Berrigan sees the probe as an effort to head off controversy.
There needs to be much more oversight, competition for contracts and corporate responsibility, she said.
A war profiteering commission would be a good start and could insist on greater transparency and hold Halliburton employees and other employees lawfully accountable for wrongdoing, Berrigan added.
But the overall larger trend of privatization of public service and its implications will take more than a commission, she warned.
Hartung also sees a war profiteering commission as a good next step. He believes the Senate should lead the commission and that the commission should subpoena power to compel testimony.
The public can help keep the pressure on through phone calls, e-mails and protests, he added.
Halliburton’s stock fell to $28.24, a drop of $1.73, as the company tried to fend off questions about its integrity. “We are disappointed, once again, that selective portions of audit reports have been released publicly even before KBR and the Army have made final reviews of the information,” said Randy Harl, president and chief executive officer, KBR, in a March 11 statement. “Releases of partial reports are inappropriate because the true and complete story cannot be conveyed.”
In fact, the release of these reports could violate established federal policy, Harl complained.
Harl also argued that “KBR delivered fuel to Iraq at the best value, the best price, and the best terms and in ways completely consistent with government procurement policies. KBR’s client, the U.S. Army Corps of Engineers, provided approval and direction for KBR to continue this important work so the people of Iraq would have fuel for transportation, cooking and heating.”
The company has other problems: Two Iraqi women who worked for KBR as laundry workers were shot to death March 11 and a Utah-based subcontractor has complained it hasn’t been paid $87 million for feeding hot meals to troops in Baghdad and Mosul. Event Source said it needs to get paid or find a way to stop losing money – some suspect that might mean serving cold sandwiches to soldiers.
If There Was No Slave Trade
Guest Commentary March 17, 2004 Vol. 1 No. 6
By Kwaku Person Lynn, Ph.D.
One of the most unimaginable thoughts one could possibly think of is what the world would be like had there been no Trans Atlantic slave trade, or any form of slavery. The most obvious thing is that racism/White supremacy would not have existed. They were created out of slavery. Of course, there would be rivalries as there are high school and college rivalries, but not the negative brutal enslaving behavior based on the color of one's skin.
Attempting to survey this fantasy thought of no slave trade would require volumes of books to virtually reverse all of world history. Absent of that, let's briefly restrict our review to what it could have possibly meant for Afrika and America.
First, Afrika would be a completely different continent than it is today. It would have been the most scientifically advanced region in today's world. That may be a very difficult concept to digest considering the way Afrika has been portrayed for centuries as the dark continent with no intelligent history or culture.
In spite of this, it is no secret among scholars who have investigated and concluded that civilization, science, mathematics, engineering, technology as well as many of the elements needed to build a viable society had their genesis on the continent of Afrika. Had there been no slave trade, Afrika's scientific ingenuity would have evolved to an industrial/technological age creating modern societies.
One of the major differences may have been found in the economic organization.
Capitalism, the economic system of the western world, created during the slave trade, may not have existed in its present form. Amassing huge profits, sometimes at the deficit of human welfare, is the motivating factor of western capitalism. The economy would not have been dictated out of London or Paris, but from growing Afrikan financial centers. Because of a completely different value system in Afrika prior to European incursions, it is possible a more human-friendly economic system may have developed. There is a collective responsibility statement that supports that philosophy, "I am because we are. And since we are, therefore I am."
Without the deaths and illegal transport of some 40 to 100 million human beings in and out of Afrika, and no colonial period, most Black people in America today would have inherited the fruits of their ancestors on the continent. A common culture may have contributed to a more peaceful lifestyle. Afrika would have been a natural contrast of hundreds of ultra modern cities, deep forests and the maintenance of traditional societies. Dozens of first class universities would have existed. Thousands of corporations or similar entities would have been created to utilize the vast raw resources found nowhere else in the world. The collective insecurity and low self-esteem inherit with an enslaved population would have been non-existent. There would never had been a thought of being inferior to people of European descent.
What Afrika could have been without the slave trade is a reality we will never know. Of equal interest is what America would have been like. One thing we do know, there would have been no racial turmoil, slavery, segregation, civil rights movement, Black power movement or any struggles for equality. America would not be what it is today but for two basic reasons: one, European exploration would not have been as massive had Afrikans not given Europeans the boat technology and navigational skills to explore; two, the human labor would not have been available to build America with the absence of millions of slaves.
America today may have been equal to some of the underdeveloped areas of Europe. It certainly would not have been the world's playground. Places like Las Vegas may have never existed.
Taking that a little further, the Southwest portion of the country could have easily remained part of Mexico, with the Louisiana area still owned by France or Spain. The Caribbean Islands would not have a dominant population of Afrikan descendents, just the indigenous peoples who were there prior to the slave trade.
All of this is pure speculation. The possibility that strums up in the mind is simply a beautiful thing. There is no guarantee that this would have been a better world, for there still may have been a Napoleon or a Hitler somewhere. But if there was no slave trade, Afrika would have been strong and technologically sound enough to resist any successful invasions or conquering of its land. Because of the Afrikan spiritual heritage that fed world religions, maybe this could have been a better world. The only thing we do know, is that we will not know.
(Kwaku Person-Lynn is the author of “On My Journey Now - The Narrative And Works Of Dr. John Henrik Clarke, The Knowledge Revolutionary.” E-mail: DrKwaku@hotmail.com or visit www.drkwaku.com on the wide world web.)
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