Evelyn Pringle: Iraq -- Bush Family $$$ Signs
Iraq -- Bush Family $$$ Signs
By Evelyn Pringle
After Dick Cheney's tenure at the Pentagon ended, in 1993, he spent much of the next two years deciding whether to run for President. He formed a political-action committee, and crossed the country making speeches and raising money, according to Contact Sport, 2/16/04 New Yorker.
Records from the FEC show that Cheney's PAC contributors included executives of the companies that have since won the largest contracts in Iraq. Among them were Thomas Cruikshank, Halliburton's CEO at the time; Stephen Bechtel, whose family's firm now has a contract in Iraq worth as much as $2.8 billion; and Duane Andrews, then senior VP of Science Applications International Corporation, which has won seven contracts in Iraq.
However, while Cheney and his pals may well be the most blatant profiteers in Iraq, they are by no means the only ones involved in this grand war profiteering scheme commonly referred to as the "War on Terror." The #1 spot on the list belongs to the First Family.
War Is Family Business
Here's where the web of deceit really gets complicated. There are so many ties between the Bush family, the defense industry and the global arms trade, that its almost impossible to keep track of them all. But yet the wide-spread ties are hardly ever even mentioned in the mainstream media. Or a revelation might show up for a day or two and then its like oh well, what's new.
Lets Start At The Top - The First President Bush
When Jr took office, Bush (Sr) was a member of the Carlyle Group. The firm is almost entirely made up of ex-government officials and it is said to be the world's most politically connected private equity firm.
The complaints about the Bush family connections with the Carlyle Group began long before 9/11. As early as March 3, 2001, shortly after Bush Jr’s inauguration, Judicial Watch issued a press release that said:
"Judicial Watch, the public interest law firm that investigates and prosecutes government abuse and corruption, called on former President George Herbert Walker Bush to resign immediately from the Carlyle Group, a private investment firm, while his son President George W. Bush is in office. Today's New York Times reported that the elder Bush is an "ambassador" for the $12 billion private investment firm and last year traveled to the Middle East on its behalf. The former president also helped the firm in South Korea.”
"The New York Times reported that as compensation, the elder Bush is allowed to buy a stake in the Carlyle Group's investments, which include ownership in at least 164 companies throughout the world (thereby by giving the current president an indirect benefit). James Baker, the former Secretary of State who served as President George W. Bush's point man in Florida's election dispute, is a partner in the firm. The firm also gave George W. Bush help in the early 1990's when it placed him on one of its subsidiary's board of directors.
"This is simply inappropriate. Former President Bush should immediately resign from the Carlyle Group because it is an obvious conflict of interest. Any foreign government or foreign investor trying to curry favor with the current Bush Administration is sure to throw business to the Carlyle Group. And with the former President Bush promoting the firm's investments abroad, foreign nationals could understandably confuse the Carlyle Group's interests with the interests of the United States government," stated Larry Klayman, Judicial Watch Chairman and General Counsel.
"Questions are now bound to be raised if the recent Bush Administration change in policy towards Iraq has the fingerprints of the Carlyle Group, which is trying to gain investments from other Arab countries who [sic] would presumably benefit from the new policy," stated Judicial Watch President Tom Fitton."
As a rule, I'm not a major fan of Judicial Watch; however in this case their comments are almost prophetic.
Shortly after the 9/11 attacks, it became known that Bush Sr was financially linked to the bin Laden family. The Sept 28, 2001 Wall Street Journal (WSJ) reported that, "George H.W. Bush, the father of President Bush, works for the bin Laden family business in Saudi Arabia through the Carlyle Group, an international consulting firm."
When Sr hooked up with the Carlyle Group, his special area of influence was the Middle East, and especially Saudi Arabia investors. One of the investors that he brought to Carlyle was the BinLaden Group, a construction company owned by the family of none other than future US #1 enemy Osama bin Laden. According to an investigation by the WSJ, Sr convinced Osama's brother, Shafiq bin Laden, to invest $2 million of Bin Laden Group money with Carlyle.
According to the WSJ, "The senior Bush had met with the bin Laden family at least twice in the last three years - 1998 and 2000 -- as a representative of Carlyle, seeking to expand business dealings with one of the wealthiest Saudi families, which some experts argue, has never fully severed its ties with black sheep Osama in spite of current reports in a mainstream press that is afraid of offending the current administration."
I'm no expert, but I even knew that 6 months prior to 9/11, Osama appeared in a video taken at his son's wedding, along with his mother, his son and his son's new wife. I guess they family must have got into a tiff after the wedding.
The WSJ went on to outline the details of the family's investment. The bin Laden firm invested $2 million in Carlyle Partners II Fund, which raised a total of $1.3 billion overall. The fund purchased several aerospace companies among 29 deals. "So far, the family has received $1.3 million back in completed investments and should ultimately realize a 40% annualized rate of return," a Carlyle executive told the WSJ.
On Sept 27, the WSJ said it confirmed that a meeting took place between Sr and the bin Laden family through Sr's Chief of Staff Jean Becker, but only after the WSJ showed Becker a personal thank you note that Bush Sr sent to the bin Ladens after the meeting.
Here's a little know fact that may bring goose bumps to some. On 9/11, Shafiq bin Laden was at a meeting in the office of the Carlyle Group, and stood watching on TV as the WTC was destroyed under the instruction of his brother
So in a nutshell, Osama's attacks on the WTC and Pentagon, which lead to a massive increase in defense spending, most likely made the Bush family a great deal of money. And the real kicker is that the attack may have even enriched his own family.
How Does Carlyle Make Its Money?
Its been estimated that Carlyle has investments in over 300 companies, and the majority of them derive revenues from military and security contracts. In fact, Carlyle is the country’s 11th largest defense contractor. In 2002, it received $677 million in government contracts, and in 2003, it was awarded contracts worth another $2.1 billion.
Business has definitely improved for the firm since Jr took office. For example, one of its subsidiaries, Vought Aircraft, now holds over $1 billion in defense contracts. Prior to 2001, the company's future was iffy at best. Right before 9/11, it had actually laid off 20% of its workforce. But low and behold, business picked right back up with the air strikes on Afghanistan and the war in Iraq.
Carlyle's ties go directly into the Oval Office. In fact, a list of past employees has Jr's name on it. He was actually employed by Carlyle at on point in his life. According to a story in Harper's Magazine, Jr held a position as a corporate director on the board of the Carlyle subsidiary, Caterair. Until he was politely told to hit the road because he didn't have anything to offer the company.
In addition, in March, 1995, while Jr was governor of Texas governor and a senior Trustee of the University of Texas, the University of Texas Endowment placed $10 million in investments with the Carlyle Group. Who knows how much of that investment money benefited the bin Ladens.
Side-Kick James Baker
Sr's top sidekick, James Baker, is also a player with the Carlyle Group. He joined the firm immediately after his stint as Sr's secretary of state ended, bringing a briefcase packed full of global connections to the firm. Carlyle's revenues tripled after Baker came on board.
Much like Bush Sr, Baker's main duty was to manage firm's relationships with Saudi clients. He not only handled investment deals, it was also his job to look after the key interests of Saudi investors. For instance, when the Justice Department began an investigation into the financial dealings of Saudi Prince Sultan bin Abdul Aziz, guess who the prince turned to for help? You got it, Baker.
And get this, Baker is currently defending the prince in a trillion dollar lawsuit brought by the families of the victims of the 9/11. The suit accuses the prince of using Islamic charities to funnel millions of dollars to known terrorist groups linked to al-Qaeda.
Carlyle is also cashing in on the Homeland Security front and the enactment of the Patriot Act. Two Carlyle companies, Federal Data Systems and US Investigations Services, hold multi-billion dollar contracts to provide background checks for airlines, the Pentagon, the CIA and the Department of Homeland Security. USIS used to be a federal agency, until it was privatized in 1996 and snatched up by Carlyle. Needless to say, it's now making money hand over fist.
Baker & Carlyle Hard At It
Baker and Carlyle have been hard at it behind the scenes, profiting in ways so blatant that a secret deal revealed by Nation Magazine (and since reported in most major newspapers) gives a whole new meaning to the term war profiteering.
As most people know, Bush Jr appointed Baker to be his special envoy on Iraq's debt. His mission was to meet with presidents and prime ministers around the world and ask them to forgive Iraq's debt in the name of the reparation needs of the country.
When Baker was appointed, questions about conflict of interest were raised because of his ties to the Carlyle Group, which has extensive business interests in the Middle East. His law firm, Baker Botts, was also brought up because both firms have strong links to the Saudi Royal Family, which happens to hold a great deal of Iraq's debt.
In fact, the New York Times published an editorial upon the announcement of Baker being appointed special envoy that called for Baker to resign from both Carlyle because he was a partner, and Baker Botts.
In response to the editorial, Jr said he doesn't read editorials, but assured the world that Baker was a man of high integrity. Carlyle submitted a signed statement that said: "Carlyle does not engage in lobbying or consulting." and "Carlyle does not have any investment in Iraqi public or private debt."
Well that was then and this now. According to confidential documents obtained by the Nation, including a 65 page proposal to the Kuwaiti government, Carlyle has sought to secure a $1 billion investment from Kuwait using Baker's influence as debt envoy. The secret deal involved a plan to transfer ownership of up to $57 billion in unpaid Iraqi debts owed to Kuwait. The debts would be assigned to a foundation created by a consortium in which the key players are the Carlyle Group and the Albright Group, headed by former secretary of state Madeline Albright, along with several other well-connected firms.
So it boils down to this, the Carlyle Group was engaged in lobbying to secure Iraq's debt at the same time that Baker was asking the world to forgive those debts. Under the deal, Kuwait would give the consortium $2 billion up front to invest in a private equity fund, with half of it going to Carlyle.
The Nation showed the documents to Jerome Levinson, and international lawyer and expert on political and corporate corruption at American University. He called it "one of the greatest cons of all time. The consortium is saying to the Kuwaiti government, 'Through us, you have the only chance to realize a substantial part of the debt. Why? Because of who we are and who we know.' It's influence peddling of the crassest kind."
Kathleen Clark, a law professor at Washington University and a leading expert on government ethics and regulations, told The Nation, that this means Baker is in a "classic conflict of interest. Baker is on two sides of this transaction: He is supposed to be representing the interests of the United States, but he is also a senior counselor at Carlyle, and Carlyle wants to get paid to help Kuwait recover its debts from Iraq." She said, "Carlyle and the other companies are exploiting Baker's current position to try to land a deal with Kuwait that would undermine the interests of the US government."
Just listen how they described The Carlyle Group, "a private equity team, has earned its reputation by successfully consummating deals at the intersection of politics and finance, with its roster of political stars, including, among others, former US Secretary of Defense Frank Carlucci, former British Prime Minister John Major, and until recently, former US President George Bush."
I like that "stars." Is that kind of like Hollywood stars except they are from Washington?
The document goes on to state: "The extent to which these individuals can plan an instrumental rule in fashioning strategies is now more limited ... due to the recent appointment of Secretary Baker as the President's envoy on international debt, and the need to avoid an apparent conflict of interest." Yet it goes on to say that this will soon change: "We believe that with Secretary Baker's retirement from his temporary position, that Carlyle and those leading individuals associated with Carlyle will then once again be free to play a more decisive role..." according to The Nation.
I wonder if this means we're going to lose our special envoy. Retirement?
The proposal goes on to tell Kuwait that in the near future 40 state-owned Iraqi enterprises will be available for leasing and management contracts. Is that kind of like privatizing public utilities? 40 of them, huh? You mean we are going to do all that for Iraq? Does that mean that the Iraqis might have clean water, and not have raw sewage in their streets anytime soon? I suppose that would be a good thing.
Now where in the world did the Iraqis ever get the idea that we wanted to take over their country? I've never been able to figure out why they would ever think that.
For those readers wondering about how much progress Baker has made in the 10 months in his position as special envoy, I'd have to say not much. The negotiations apparently are kind of stalled.
Senator Joe Biden recently asked Deputy Assistant Secretary of State for Iraq, about the status of the international negotiations to get other countries to forgive Iraq's debts. He asked, "Has a single nation in the G8 ... formally said or requested of their parliaments to forgive Iraqi debt?" "Not yet. No sir," Schlicher answered.
According to The Nation, "Not only has Baker failed to deliver any firm commitments for debt forgiveness; at the annual meeting of the International Fund on October 2, it emerged that France had done an end run around Washington and was pushing a debt-relief deal of its own. ... a plan to cancel only 50% of Iraq's debts -- a far cry from the 90-95 % cancellation Washington had been demanding. Yet Baker was nowhere to be found."