Federal Government Against Free Market
|May 11, 2003||Posted by Staff under The Progress Report|
Federal Government Against Free Market
Here is a news update from Taxpayers for Common Sense. TCS is the best organization that monitors excessive government spending, corruption and corporate welfare.
HALLIBURTON’S ROAD TO RICHES Earlier this week, the Bush administration was forced to disclose that it has awarded a Halliburton subsidiary a no-bid contract for the much-sought-after job of managing and running the oil fields of Iraq. Up to this point, it was thought that the contract, worth up to $7 billion, was only for putting out fires caused and started by the Hussein regime.
With billions of federal dollars at stake, taxpayers might hope that the administration would create a highly competitive bidding process to ensure that tax dollars are spent wisely. But, why should we kid ourselves when Halliburton has being receiving special treatment and favors from the federal government ever since its former CEO and current U.S. Vice President Dick Cheney was running the Defense Department?
It all started about eleven years ago, when then-Secretary of Defense Cheney had the Pentagon pay Brown & Root about $9 million to study how private companies could provide logistical support to the military. The report, which is classified, has obviously proved itself to be an invaluable educational tool for Brown & Root when it came time to come begging for federal bucks.
Almost immediately after the study was delivered, the Pentagon awarded Brown & Root a five-year contract to be the sole provider of worldwide support services and contingency operations for the U.S. military. This contract placed their employees alongside soldiers in far away places including Somalia, Haiti, the Balkans and even Bosnia. In the Balkans alone, Brown & Root made more than $2 billion in revenue. From washing thousands of soldiers’ underwear to building kitchen sewer systems to providing transportation services, Brown & Root provided whatever the military needed, and made a pretty penny in the process.
Despite the fact that Brown & Root’s services were shoddy and rife with fiscal mismanagement, this lucrative contract was renewed in December 2001, and it’s worth billions to the company today. Study after study revealed a pattern of waste and fiscal irresponsibility. In one report, the General Accounting Office found that Brown & Root was charging more than $80 bucks per piece of plywood and in a lot of cases most of their overseas workers were being paid to do nothing.
Upon Cheney’s 1993 departure from the Pentagon, he landed with a golden parachute at Halliburton. Although he had minimal real business experience, they paid Cheney a multimillion-dollar salary to run the show. The decision resulted in a federal gold rush for the company. Just last year, Brown & Root provided more than $1.3 billion in services to the federal government, a growing portion of its business.
Highlights of recent contracts include: $115 million to design and construct an embassy compound in Afghanistan; $37.3 million to build 816 detention cells at Guantanamo Bay Cuba, where “suspects” captured in Afghanistan are held; a $5.3 million contract for emergency repairs to an oil and lubricants pier facility at Lajes Field, Azores; and $2 million to reinforce the U.S. embassy in Uzbekistan.
The military has relied on private contractors since the Civil War, but through its ability to create for themselves a permanent revolving door, Brown & Root has become the contractor of choice. Not only does this stink to high heaven, the continued reliance on just one company for these services is squashing competition and costing taxpayers dearly. While past mistakes may be impossible to fix, Congress needs to make sure that future contracts are awarded based on an open and competitive process.
For more information, contact Keith Ashdown at (202)-546-8500 ext. 110 or by email at email@example.com
TCS is at www.taxpayer.net
Why does the federal government choose corruption and insider dealing instead of free market competition? How can the situation be improved for the future? Tell your opinions to The Progress Report!