The Bush Family 'Oiligarchy'
By Sam Parry

Many of George W. Bush's senior foreign policy advisers also have close ties to the oil industry.

Condoleeza Rice, George W.'s chief foreign policy aide and leading candidate to serve as his national security adviser, has been a director of Chevron Corp. since 1991. Rice is currently in charge of public policy for Chevron's board of directors, which has used her expertise in Russian issues to help Chevron navigate its way to investments in the Caspian Sea oil fields.

In 1993, Rice was granted a rare honor when Chevron named an oil tanker after her.

Lawrence Eagleburger, a seasoned Bush counselor who held top State Department posts under George W.'s father, is a director of Halliburton Corp., the world's largest oil field services company.

When looking for a running mate, George W. also turned to Halliburton. He asked Dick Cheney, Halliburton's chairman and chief executive, first to vet other candidates and later to take the job. With Cheney at Halliburton's helm for the past five years, the Dallas-based company grew into a global juggernaut, now with two-thirds of its business overseas. It has business in nearly 130 countries, counts about 700 wholly and partly owned subsidiaries, employs more than 100,000 workers worldwide, and boasts a 1999 income of $15 billion. [AP, July 26, 2000]

Halliburton's global network of investments includes projects in politically volatile areas, some with savage human rights records. Other countries, where Halliburton has subsidiaries, have come under criticism for bank secrecy.

The nations where Halliburton does business include oil-producers such as Nigeria, Indonesia, Saudi Arabia, Algeria, Kazakhstan, Azerbaijan, Iran, Libya, Angola and Russia. The company's roster of subsidiaries also lists companies in offshore banking havens, such as the Cayman Islands, Barbados, Panama, Cyprus and Vanuatu. [Halliburton's annual report, March 2000]

While the political Cheney might have worried about the nature of U.S. business ties to some of these countries, Cheney the oilman apparently sees nothing wrong with lucrative investments in these places, even though Iran and Libya remain on the State Department's list of terrorist states.

As politician-Cheney promotes the need for a missile defense system in the U.S. for fear that "rogue" states might develop missiles powerful enough to threaten American cities, oilman-Cheney has negotiated Halliburton investments in some of those very countries and has criticized the use of economic sanctions as a tool of U.S. foreign policy.

During Cheney's tenure, Halliburton built up operations in Nigeria despite the country's pattern of human rights violations. Halliburton's subsidiaries signed contracts with Royal Dutch Shell and Chevron, two companies that have been at loggerheads with Nigerian indigenous groups in the Niger Delta.

In April 2000, Brown & Root Energy Services, a business unit of Halliburton, was selected by Shell Petroleum Development Co. of Nigeria to work on the development of an offshore oil and gas facility, the first of its kind for Shell. The deal, valued at $300 million, has been questioned by those who have worked to hold Shell accountable for its pollution and notorious human rights record in Ogoniland in the Niger Delta.

Shell has been involved in oil exploration and export in Nigeria for more than 40 years, much of it in the fertile lands belonging to the Ogoni people in the Niger Delta. During this period, Shell's activities led to repeated environmental calamities, caused by oil spills, noxious gas flares, cleared forests, despoiled farmland and pipeline blowouts.

Shell's operations and the money they generated for the military government of Sani Abacha earned Shell free rein in its operations. Gen. Abacha's government used force to crush popular protests against the oil industry throughout the Niger Delta.

Just five years ago, in November 1995, the year Cheney joined Halliburton, renowned writer and environmental advocate Ken Saro-Wiwa and eight of his colleagues were hanged by the Abacha government for their efforts to prevent Shell from continuing to poison the environment of the Niger Delta.

It is estimated that more than 2,000 people have been murdered for their involvement in protests against Shell's activities in the Delta. Most of those murdered were Ogoni who had rallied behind Saro-Wiwa in the early 1990s.

In 1999, Gen. Abacha died under mysterious circumstances that have yet to be fully clarified. An interim government gave way to a popularly elected administration headed by former Nigerian Gen. Obasanjo. The transition to democracy in Nigeria has led to renewed hope that tensions in the Niger Delta will ease. Still, inequality and poverty are rampant.

In recent weeks, desperate Nigerians caused deadly explosions when they tapped pipelines to siphon oil for sale in the open market. These explosions, while they can't be blamed directly on the oil companies, are caused by the crushing poverty faced by many Nigerians, especially in the Niger Delta. Halliburton and its business allies have turned a blind eye to this inequality created in part by the exploitation of the area's oil.

In July 1997, an incident occurred in the Niger Delta that should have set off alarms in Halliburton executive suites. A youth by the name of Gidikumo Sule was killed by the Mobile Police, notorious for their brutal tactics. Sule was among dozens protesting Chevron in a dispute involving a Chevron contractor. That contractor was Halliburton.

The versions of the story vary, but what is known is that a group of youths trying to send a message to Chevron stopped a barge owned by Halliburton, blocking access to a Chevron facility. The youths were apparently protesting the fact that Chevron had failed to hire any local workers for a project.

Mobile Police units were sent in to break up the protests and in the ensuing confrontation, the police fired at the youths killing Sule. [See The Price of Oil, Human Rights Watch, 1999/nigeria/Nigew991-08.htm .] After the incident, Halliburton, which owned the barge at the center of the controversy, increased its business dealings in the area.

Cheney's Money

Over the past five years, Halliburton has compensated Cheney handsomely for his services.

As Halliburton's chairman and CEO, Cheney earned a $1.3 million salary, plus bonuses that varied from zero to $2 million. [See Halliburton's filings with the Securities and Exchange Commission.] In June, Cheney sold 100,000 shares of Halliburton stock, bringing him an additional $5.1 million. During his five-year tenure, Cheney accrued salary and stock options worth an estimated $45 million. [AP, July 26, 2000]

In addition, upon resigning from Halliburton to run with Bush in July, the 59-year-old Cheney received what amounted to a $20 million parting gift. Halliburton's board waived a requirement that Cheney would lose many of his stock options if he left before age 62. [NYT, Aug. 12, 2000]

Under the Halliburton deal, Cheney retained 400,000 unvested stock options that will "vest" in batches over the next three years. That means their value depends on Halliburton's stock price at the time the vested options are exercised. Unlike other holdings, unvested options cannot effectively be put in a blind trust since a trustee cannot do anything with them until after they vest, ethics expert note. In other words, Cheney will be aware that his personal wealth will rise and fall along along with Halliburton's stock prices.

If Cheney is elected vice president and becomes a key foreign policy adviser to Bush (as he would be expected to be), Cheney could advocate U.S. actions that would benefit Halliburton's business. That, in turn, would make Cheney's options more valuable when they vest, possibly earning him many millions of dollars in additional profits. For instance, an administration decision to lift sanctions on Iran could give Halliburton a boost in competition for lucrative pipeline construction around the Caspian Sea.

So, the unvested options are a kind of multi-million-dollar leash tethering Cheney to Halliburton's business success, at least for the next three years.

Back to the Future

During the Democratic convention, director/actor Rob Reiner joked that the Republican idea of diversity was "two guys at the head of the ticket that are from two different oil companies." Indeed, never before have both candidates on the same ticket come from the oil industry, a fact that has drawn some notice but little serious discussion about the potential impact on the nation's energy, environmental and even economic policies.

While the national media shows only a desultory interest in the Bush-Cheney oil connections, almost daily there are new warnings about the worldwide peril posed by the burning of fossil fuels, the chief cause of global warming.

Scientists who recently traveled to the Arctic Ocean have come back with alarming news that much of the thick ice that has covered the North Pole for eons has turned to water. [NYT, Aug. 19, 2000] This stunning observation is only the latest evidence that global warming poses a real threat to the safety of many millions of people around the world and to the economic stability of many millions more.

Still, the oil industry and its backers continue to insist that global warming is largely a myth, an exaggeration by environmental extremists. This argument -- mocking the environmental movement -- is funded by many of the same economic interests that have invested in the political ambitions of the Bush family for the past 50 years.

Whatever the dangers from global warming and other environmental problems, it is certainly at the heart of the oil industry's interests for the world to remain dependent on internal-combustion engines and reliant on oil production. The oil industry is a pillar of the Old Economy whose interests are threatened by technological advances that could make electric cars and solar energy more competitive.

Given these ties that bind -- between the Bush-Cheney ticket and the oil industry -- global warming and other environmental concerns do not seem likely to rise to the top of the national agenda in a Bush-Cheney administration. The oil industry would be confident that it had staunch allies in the White House, people who not only understand the industry's needs but who feel its pain.

This relationship also would not be a passing fling. It is rooted in a half century of deep-and-abiding connections and mutual dependencies between the Bush family and the oil industry.

These are entangling alliances that the U.S. public only vaguely discerns. In the smog of Sunbelt cities, in the smelly haze of gasoline refineries, in the smoky burn-off of oil wells in the Third World and the Middle East, there stands a Bush family "oiligarchy."




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