Site Presented By
Sunday, Nov 22, 2009
American corporations with close ties to the White House are poised to cash in on Saddam's defeat. French companies need not apply.
Mar 17, 2003 | As the prospect of war with Iraq comes ever closer, companies with expertise in combating oil-well fires have begun to publicly complain that the U.S government has not been forthcoming with details of the firefighting services it may require in the Middle East.
Their concern is not abstract; many experts think it is likely that Saddam Hussein may duplicate his behavior in Kuwait and destroy Iraqi oil fields in a last-gasp gesture of defiance. So, early in March the Department of Defense finally announced that it had developed a plan to deal with the possibility, and on Thursday the Pentagon posted a toll-free phone number on its Web site to provide "a recorded message ... on the information necessary for firms to be added to the bidders list." After just a few hours, the phone number had been overwhelmed with calls; by the afternoon, a message said that the voice-mailbox was full, and it offered no details on how firms could bid for firefighting contracts.
The overloaded Defense Department bidding line provides a good illustration of the frenzy for war that is building in some sectors of the business community. It's not just the firefighters; many companies see war in Iraq in a favorable light, as a significant source of new business.
Representatives of these firms won't say so in so many words, certainly, and some -- like the firefighters or the construction companies that will rebuild critical infrastructure in Iraq -- convincingly defend their work as necessary to immediately aid civilians and repair a war-ravaged nation. War is hell, but when the fighting is over, somebody's got to make things better. What's so wrong with profiting from the deal in the process?
But even if there's nothing exactly new about making money from war, this particular conflict, a preemptive war of choice, presents the somewhat novel prospect of the U.S. government deciding how war profits will be distributed even before the first sorties are launched. Whether you think Iraq will be "conquered" or "liberated" by American forces, regime change in the country will open up vast new opportunities for commercial interests to do business there, and the Bush administration could have wide latitude in determining which of those interests win out. Already, companies are jockeying for prime positions, and already there are signs that the White House is being nicest to its friends.
On March 10, for example, the Wall Street Journal reported that the United States Agency for International Development (USAID) had invited a handful of large engineering firms to bid on a $900 million contract for rebuilding Iraq. The Journal described the agency's efforts as "quiet," but "secret" seems a more apt term. In a procedure designed to respond to "urgent circumstances," the agency decided not to put out a public notice soliciting engineering bids and instead approached select firms "with a proven track record," said Ellen Yount, an agency spokeswoman.
All of these firms are American, and many have close ties to present and former government officials. One of the companies is Kellogg Brown & Root, a subsidiary of the Halliburton Co., the firm that Vice President Dick Cheney ran during the 1990s. (KBR also developed the Pentagon's firefighting plan.) USAID declined to discuss the sort of work it had asked the companies to do, and several of the firms would neither confirm nor deny that they had been contacted by the government regarding Iraqi reconstruction. The others were only slightly less reticent, admitting they were part of the group but refusing to discuss details of USAID's request.
On Wednesday, top U.S. foreign policy experts, working on behalf of the Council on Foreign Relations, released a report estimating rebuilding in Iraq to cost up to $20 billion per year for "several years"; it's reasonable to expect, then, that after the war, contracts worth much more than USAID's initial $900 million request will be made available to firms.
The news that some well-connected American firms will be first in line for these billion-dollar deals did not help the Bush administration's case for war internationally. Headlines all over the world questioned the White House's true motives for war. During a session of the British Parliament, one Liberal Democrat member asked Prime Minister Tony Blair why his allies in the U.S. had "pointedly excluded British and foreign firms." Vincent Cable, the M.P., continued, "Is the prime minister not embarrassed to have given such unstinting loyalty to an American president who regards international cooperation with such contempt and war as an opportunity to dish out contracts to his cronies?" Blair dodged the question, but his spokesman told the British press that the prime minister hopes the United Nations, and not the U.S., would head the rebuilding effort.
It's hyperbole to argue that the Bush administration wants to invade Iraq only for the benefit of its friends in the corporate world (though some people no doubt believe that). For some businesses -- most notably the airlines, which fear billions in losses if there is a war -- an invasion will likely be terrible for the balance sheet. But, as in the Gulf War, some companies will make a bundle from an attack, and one doesn't have to be very conspiracy-minded to notice that these are the very same firms that have intimate ties with the Bush administration. Is it unreasonable to think that the high-minded goal of bringing freedom to Iraqis exists, in this White House, alongside many less noble political calculations -- for instance, old-fashioned corporate opportunism? Or, making sure that the spoils of war stay out of the hands of the troublesome French?
