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The Cheney myth (continued)

Of course, everyone makes mistakes. But Cheney’s was of a magnitude that might have ended his career had he not bailed out on his own to become George W. Bush’s keeper. By 2001, the Dresser subsidiary responsible for the asbestos cases was sinking under the weight of those lawsuits. Halliburton’s stock price plummeted from $54.02 a share on August 16, 2000, the day Cheney left, to $13.20 on July 31, 2002. As recounted by Dan Briody, the number of asbestos claims filed against Halliburton soared to 320,000. The company got out from under only by filing for bankruptcy for two of its subsidiaries, and by paying a $4.4 billion settlement to the victims. During Cheney’s tenure as CEO, Halliburton’s revenues doubled, to $15 billion per year, and he was hailed in the business press as a visionary leader along the lines of — oh, let’s pick a name at random — Ken Lay, the head of Enron. Later, it became obvious that Cheney — and Lay — were not what they seemed. The difference is that Lay faces up to 175 years in prison if he is convicted of wrongdoing in Enron’s collapse. And Cheney is running the world.

Nor are their once-vastly-overblown reputations the only things that Dick Cheney and Ken Lay have in common. For one thing, Halliburton helped build Enron Field (now Minute Maid Park), the home of the Houston Astros. More to the point, Halliburton and Enron shared a taste for shady tax shelters and accounting tricks. During Cheney’s five years at the top, Halliburton went from paying $302 million in federal taxes to collecting an $85 million rebate. According to John Nichols, Halliburton accomplished this mainly by increasing the number of its off-shore subsidiaries — many of them "little more than post-office boxes and sheds," as CBS News learned during a 60 Minutes field trip — from nine to 44.

The similarities to Enron don’t stop there. This past August, the Securities and Exchange Commission announced that it had fined Halliburton $7.5 million for secretly changing its accounting procedures while Cheney was CEO. The change — which involved counting anticipated cost overruns as income — allowed Halliburton to claim 46 percent higher earnings in 1998 than it should have, and had a positive effect on its bottom line in 1999 as well. (The accounting change was legal; keeping it a secret was not.) According to the New York Times, Cheney testified under oath to the SEC, which said he had "cooperated willingly and fully." But Cheney’s lawyer, though insisting that Cheney’s conduct as CEO had been "proper in all respects," declined to answer a question regarding how much Cheney knew about the accounting change at the time that it was made. For that, we must turn to Cheney’s successor at Halliburton, David Lesar, who made a remarkable admission to Newsweek in July 2002. According to the magazine, "Lesar defended the firm’s bookkeeping and said Cheney was aware that the firm was counting projected cost-overrun payments as revenue." The article quoted Lesar directly as saying, "The vice-president was aware of who owed us money, and he helped us collect it."

And here’s a bonus factoid: it turns out that the accounting firm that helped Halliburton pull off this not-so-slick maneuver was Arthur Andersen, the same company that went under after its wrongdoing in the Enron scandal was brought to light.

FOR ANYONE who believed that Dick Cheney’s time at Halliburton was the perfect preparation for him to serve as George W. Bush’s prime minister, the last four years must have been terribly disillusioning. Far from acting as the mature, experienced counselor, Cheney has functioned as the enabler-in-chief, pushing long-discredited conspiracy theories (even Bush felt compelled to call Cheney out after the veep repeated one time too many the false story of the meeting in Prague between lead 9/11 hijacker Mohamed Atta and an Iraqi intelligence official), promoting the phony claims of Ahmad Chalabi regarding Saddam Hussein’s weapons capabilities and ties to Al Qaeda, and dropping by CIA headquarters on a regular basis to pressure the agency into giving him the intelligence the White House needed to justify a pre-emptive war.

By looking at Cheney’s Halliburton record more closely, though, a different vice-president comes into view — one who is not unfamiliar to those with long memories. Far from demonstrating good judgment, Dick Cheney’s ill-informed recklessness has long made him a liability. Behind his calm, steady demeanor and his legendary capacity for work is someone who is concerned mainly with maintaining and increasing his power, the consequences be damned.

As Gerald Ford’s chief-of-staff, Cheney engineered the dumping of Nelson Rockefeller from the 1976 ticket, which John Nichols argues was largely responsible for Ford’s defeat: the move alienated moderates without attracting conservatives, who had already given their hearts to Ronald Reagan. As secretary of defense, he schemed to overthrow Saddam Hussein behind the backs of then–Joint Chiefs of Staff chairman Colin Powell, General Norman Schwarzkopf, and the first President Bush himself. Bush père certainly understood what a disaster that would be; as John Kerry said in his first debate with George W. Bush, Bush senior resisted the urge to march to Baghdad "because there was no viable exit strategy. And he said our troops would be occupiers in a bitterly hostile land." But that was then. Cheney managed either to outlast or leap ahead of all of them — Bush the Elder, Powell, Schwarzkopf — and work his will on the former president’s pliant son. Of course, the war quickly turned into every bit the disaster that the first President Bush had said it would be.

"Cheney’s manner and authority of voice far outstrip his true abilities," Chas Freeman, ambassador to Saudi Arabia under Bush’s father, recently told Rolling Stone. "It was clear from the start that Bush required adult supervision — but it turns out Cheney has even worse instincts. He does not understand that when you act recklessly, your mistakes will come back and bite you on the ass."

Halliburton was a brief interlude in the life of a man who has made his career in government; a chance to cash in on his connections and get rich before returning to the political battlefield that is his true calling. Look closely, and you can see that his five years in the private sector were a microcosm of his career and a premonition of what was to come. Lies. Sloppy management. Believing what he wanted to hear. Dubious alliances. And, above all, mind-boggling incompetence.

Some evil genius, huh?

Dan Kennedy can be reached at dkennedy[a]phx.com. Read his Media Log at BostonPhoenix.com.

page 4 

Issue Date: October 22 - 28, 2004
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