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   Crude Power
   In his new book, Cronies: Oil, the Bushes, and the Rise of Texas,
   America's Superstate, author Robert Bryce explains the extent of both
   Big Oil's and the Lone Star State's influence over America's foreign
   policy.
   Maxim, June 2004
   By Robert Bryce
   Some of the soldiers carried shotguns, others Heckler & Koch MP5
   submachine guns. A few held crowbars to break open doors. They wore
   green jumpsuits, body armor packed with ammunition, and black
   balaclavas. Within a minute or so of boarding their 82-foot-long Mark
   V jet-boats, the four platoons of Navy SEALs were zipping across the
   upper Persian Gulf at nearly 60 miles per hour. It was March 20, 2003.
   George W. Bush's ultimatum to Saddam Hussein had expired only a few
   hours earlier.
   The SEALs were heading into the very first battle of the second Iraq
   war. Their mission: Capture Iraq's most valuable asset, its oil
   spigot.
   Within minutes the SEALs' jet-boats reached Mina al-Bakr, Iraq's main
   oil export terminal, a sprawling metal spider of pipes, pumps, and
   pilings. It was the equivalent of a cash machine backed by a
   near-inexhaustible supply of liquid money redeemable at dozens of
   thirsty refineries around the world.
   The SEALs quietly crept up the terminal's ladders, their weapons at
   the ready. Reaching the main level, they stormed the terminal's
   control room and cramped living quarters. Instead of a gunfight, all
   they found was a bunch of sleepy Iraqis, eager to surrender. "I think
   they were actually relieved to have the place taken over," said one
   SEAL after the two-minute raid.
   The takeover of Mina al-Bakr won't be recalled alongside Gettysburg,
   D-day, or Khe Sanh, but it prevented Iraq from repeating the
   ecoterrorism-by-oil-spill of 1991. It also secured the upper Persian
   Gulf for oil tankers, Navy vessels, and freighters. But Mina al-Bakr
   is significant for another reason: It's a Texas outpost in the heart
   of the Persian Gulf.

   The United States of Texas

   Mina al-Bakr was built by the quintessential Texas company Brown &
   Root, the same Brown & Root that's part of Halliburton, the world's
   second-largest oil field services firm. That's the same Halliburton
   that, until the summer of 2000, employed a former defense secretary
   named Dick Cheney and gave him a going-away present worth tens of
   millions of dollars. It's the same firm that, in 2001 and 2002, while
   Cheney was vice president of the U.S., paid him more than $367,000 in
   deferred compensation. It's the same Texas company that the Pentagon
   handed a no-bid, no-risk, cost-plus contract worth up to $7 billion to
   rehabilitate Iraq's oil fields and infrastructure.
   Halliburton's privileged role in Iraq is controversial, but it's
   hardly a new phenomenon. Since the 1960s, whether the locale was
   Saigon, Tehran, or Baghdad, Texas companies like Halliburton have been
   planting the Lone Star flag right next to Old Glory, and making big
   profits by doing so. "When cannons shoot, call Brown & Root," goes the
   old slogan.
   The second Iraq war is just the latest example of Texas politicos and
   corporations leading America's foreign and energy policies. Since
   1973, when OPEC blindsided the world with price hikes, American
   politicians, working hand in glove with oil producers from Texas and
   other states, have fought to regain some control over the world's oil
   supply--and therefore world oil prices.
   George W. Bush and his supporters say the war in Iraq is not about
   oil, but James A. Baker III, a crony of both George Bushes and
   secretary of state during the first Gulf War, said it himself over 13
   years ago: "[The] economic lifeline of the industrial world runs from
   the [Persian] Gulf," he stated at a press conference in November 1990,
   "and we cannot permit a dictator such as this to sit astride that
   economic lifeline. And to bring it down to the average American
   citizen, let me say that means jobs. If you want to sum it up in one
   word, it's jobs. Because an economic recession worldwide, caused by
   the control of one nation, one dictator if you will, of the West's
   economic lifeline will result in the loss of jobs on the part of
   American citizens."
   Managing the world's oil supply is not easily done. A stable midlevel
   price is best for the industry, one that assures that consumers,
   producers, and refiners won't be hit with a shortage or a surplus.
   Ultimately, the only way to control supplies is through the barrel of
   a gun, a fact that's been known in Texas since 1931, when
   then-governor Ross S. Sterling, oilman turned politician, sent over
   1,000 troops into the giant East Texas oil field to control the
   supply--and therefore the price--of oil. Now it's being played out
   again in Iraq, by another Texas oilman turned politician, George W.
   Bush, and his vice president, Dick Cheney, a politician turned Texas
   energy man turned politician.
   Bush and Cheney are part of a small group of powerful, Big Rich Texans
   who, through their connections to the energy industry, have exerted
   extraordinary influence in the United States and the world. Crony
   capitalism may happen everywhere, but the virulent strain of Texas
   cronyism now infecting America's capitalist democracy is more brazen
   than any of the strains of cronyism seen thus far.
   If the 20th century was the American century, then there's little
   doubt that the last half of the American century belonged to Texas.
   Two of the last three presidents--and three of the last eight--have
   been Texans. Two of those three were oilmen. And all three fought
   major ground wars.

   Like it or not, Texas rules.

   The rise of Brown & Root and LBJ
   It came down to lawyers, airplanes, and money.
   Lyndon B. Johnson's backers knew that Coke Stevenson was ahead in the
   race for the Democratic nomination for a seat in the U.S. Senate.
   Stevenson, the Texas governor, was a popular, even beloved, figure, a
   pipe-smoking politician who was unpretentious and hard-working. But a
   powerful crony network had hitched their wagons to Johnson's star.
   Johnson's chief backers were George and Herman Brown, the owners of a
   rapidly growing construction company called Brown & Root. The Browns
   knew that if Stevenson won, their federal defense contracts might
   evaporate. "They had to win this," one of their lawyers explained
   later. "Stevenson was a man of vengeance, and he would have run them
   out of Washington."
   Johnson's lead lawyers, Charles Francis and Alvin Wirtz, were among
   the state's most influential cronies, and both worked for Brown &
   Root. To achieve their goal, the Browns gave Johnson whatever he
   needed. While Stevenson traveled the state in an old Plymouth that
   didn't even have a loudspeaker, Johnson was in a DC-3 or a converted
   B-24 Liberator, a gigantic WWII bomber originally built in the Dallas
   area. But Johnson didn't stop with planes.
   LBJ pioneered helicopter campaigning, beginning with a Sikorsky S-51.
   With LYNDON JOHNSON FOR U.S. SENATE emblazoned on the fuselage, and a
   loudspeaker, the craft caused a sensation. "Coming down on those rural
   people in those little towns who had never seen anything like it, with
   that tremendous roar and the dust swirling up, it was an awesome
   thing," recalled one reporter. On one Saturday, Johnson made seven
   "hoverings" and 13 landings, speaking to some 15,000 people.
   "That thing sure makes a lot of noise," John Lyle, a Democratic
   congressman from Corpus Christi once told Johnson. "That thing sure
   gets a lot of votes," LBJ replied.
   Later on Johnson used a Bell 47-B, courtesy of Larry Bell, whose
   company was based in New York at the time. Bell saw the strategic
   value of making friends with someone like LBJ, and indeed, over the
   next few decades Bell Helicopter sold thousands of aircraft to the
   Pentagon.
   When funds ran low, Johnson dispatched John Connally, his chief aid,
   to get more cash. As Robert A. Caro reports in his biography of
   Johnson, Means of Ascent, Connally would get on a plane in Austin, fly
   to Houston, Dallas, or West Texas, and return with grocery sacks
   filled with cash, often provided by Brown & Root. On one occasion, it
   was $50,000 in $100 bills. On another, $40,000. After LBJ won by a
   highly dubious 87 votes a judge friendly to Stevenson ordered LBJ
   removed from the ballot, which his lawyers contested all the way to
   the Supreme Court. There, over a month after the polls had closed, he
   was declared the winner.
   By early 1949, LBJ and the rest of the congressional delegation were
   part of the rapidly growing Texas power base in the nation's capital.
   Sam Rayburn, Johnson's longtime ally, was once again the Speaker of
   the House. Another Texan, Tom Clark, was U.S. attorney general. Few
   people in Texas stood to benefit more than George and Herman Brown and
   their company, Brown & Root.
   The Back Seat Driver
   George Brown would have been pleased as punch. Since his first
   meetings with LBJ, he had been cultivating politicians who could help
   garner federal contracts. In 1995 a dozen years after Brown's death,
   Halliburton--B&R's parent company--hired the ultimate Washington
   insider, Dick Cheney. With Cheney at the helm, Halliburton's business
   and America's business would become inseparable.
   One of the best descriptors of Cheney's style was his Secret Service
   code name when he was chief of staff to President Gerald R. Ford: Back
   Seat. With Back Seat in the driver's seat, Halliburton's fortunes
   improved rapidly. The war zone contracting that B&R started in
   Vietnam--which Cheney avoided through student and marital
   deferments--was coming full circle. By the 1990s, thanks in part to
   Cheney, B&R was servicing the military in Zaire, Haiti, Kosovo, the
   Balkans, Somalia, and Saudi Arabia.
   Although the Pentagon was happy with Brown & Root's work, the General
   Accounting Office was not. In 1997 it found that the company was
   charging the Army in the Balkans $86 for $14 plywood sheets, and that
   the Army was "unable to ensure that the contractor adequately
   controlled costs." In 2000 the GAO again found that B&R was fleecing
   the military in Kosovo on everything from electricity to staff. One
   example: Army offices at Camp Bondsteel were cleaned four times a day.
   During Dick Cheney's tenure, 1995 to 2000, B&R's logistics contract in
   Kosovo became one of the most expensive in Pentagon history, at $2.2
   billion.
   Cheney made sure the money got to the right people. He doubled
   Halliburton's political giving to over $1.2 million in soft and hard
   money--mostly to Republicans--according to the Center for Responsive
   Politics. He also doubled Halliburton's lobbying budget, to about
   $600,000. One of his main objectives: ease sanctions in the Middle
   East.
   "The good Lord didn't see fit to put oil and gas only where there are
   democratically elected regimes friendly to the United States," he said
   in a 1998 speech at the Cato Institute. The U.S. had "become
   sanctions-happy," he said. That same year, he personally lobbied U.S.
   Senator Phil Gramm for a waiver from the Iran-Libya Sanctions Act.
   Then there were the deals with Saddam's regime. While Cheney was CEO,
   Halliburton sold Iraq $73 million in oil equipment and spare parts
   through its European subsidiaries, and did some $23.8 million worth of
   oil field work in Iraq the late 1990s, even though Cheney insisted
   that he had imposed a "firm policy" against trading with Saddam.
   For Cheney it was a no-lose situation. In addition to his Halliburton
   income, he sat on the boards of the railroad giant Union Pacific; Ross
   Perot's old company, EDS; and Procter & Gamble. In 1999 those three
   outside jobs paid him $282,500. Meanwhile, his wife Lynne was paid
   more than $300,000 for serving on other boards. On the boards, the
   Cheneys further cemented their ties to corporate titans who could
   provide the money for their political goals.
   When George W. Bush named Dick Cheney as his running mate, Cheney
   insisted he would take a bath from the move. But in the end Cheney's
   "bath" was a retirement package worth $33.7 million. His total pay
   during his tenure of less than five years at Halliburton: $45 million.
   Halliburton goes to the White House
   By 2002 no corporation was more wired into the Pentagon than
   Halliburton. It built the detention camps in Guantanamo Bay, Cuba and
   was also building the new $100 million U.S. embassy in Kabul,
   Afghanistan. It had a five-year, $300 million logistics contract with
   the U.S. Navy and a 10-year contract with the Army. The Army contract
   had no dollar limit and was reportedly the only logistics deal without
   an estimated cost. In its 2002 annual report, with war in Iraq on the
   horizon, the company wrote, "We also expect growth due to new demands
   created by increased efforts to combat terrorism and enhance homeland
   security."
   That growth became a reality in November 2002, when the Pentagon asked
   Cheney's old company to draft a plan for cleaning up a postwar Iraq.
   On March 8, 2003, the U.S. Army Corps of Engineers quietly signed a
   contract with Halliburton to extinguish any oil well fires,
   rehabilitate Iraq's oil field infrastructure, and provide motor fuel
   and other supplies to the citizens of Iraq. The contract, worth a
   potential $7 billion, was not put out for competitive bids.
   Major American media outlets questioned the deal. Chuck Dominy,
   Halliburton's vice president for government affairs and its chief
   lobbyist, said Cheney's influence had "absolutely zero impact," on the
   deal, but Dominy himself might have. A former three-star general, one
   of his last jobs was in the U.S. Army Corps of Engineers--the very
   agency that awarded the contracts to Halliburton.
   By early June 2003, Halliburton's technicians were clambering all over
   Iraq's oil facilities. About eight weeks after George W. Bush's May 1
   "mission accomplished" declaration, the pipeline from the oil fields
   near Kirkuk to the Turkish port at Ceyhan began carrying crude.
   On June 28, the first supertanker to load Iraqi crude in the
   post-Saddam era began filling up at Mina al-Bakr. The buyer:
   Condoleezza Rice's old employer, ChevronTexaco. Hours later the tanker
   steamed straight for Port Arthur on Texas' gulf coast. Over the next
   few months, a majority of tankers leaving Iraq would head for American
   refineries.
   Nearly 30 years after OPEC shut off oil flow to America for supporting
   Israel, the U.S. had gained some control over the planet's
   second-largest oil reserves. And it had done it with the barrel of a
   gun. The costs would be huge, and by early 2004 no Iraqi WMDs had been
   found. In September 2003, George W. Bush asked Congress to approve an
   $87 billion spending package to pay for the war and Iraq's
   reconstruction. Unsurprisingly, a big chunk of that money was going to
   Cheney's old company, Halliburton.
   That same month, Cheney defended his ongoing payments from Halliburton
   on TV, insisting that he had "no financial interest in Halliburton of
   any kind." This was incorrect: Cheney still had options on about
   433,000 shares of Halliburton stock and was in the third year of his
   five-year deferred-compensation deal. Cheney also said he had "no
   idea" why Halliburton got the no-bid contract. But he did say that
   "few companies out there have the combination of the very large
   engineering construction capability and significant oil field
   services." In other words, after decades of getting closer and closer
   to the U.S. government, Halliburton had become the only choice. In
   Iraq, Halliburton became example 1A of what the economist James
   Kenneth Galbraith has called the "military-petroleum complex."
   In Iraq, the U.S. government, the military, corporate America, and the
   oil business became one.
   Cash & Kerry                                                
   John Kerry's donors aren't Big Oil, but they get good grease.
   $240,046*
   The donor: Mintz Levin. This Boston-based legal firm represents major
   biotech and telecom companies, including AOL. Coincidentally, they
   also employ Kerry's little bro, Cameron.
   The kickback: Kerry's pushed for relaxing regulations for Mintz
   Levin's telecom clients. He swears he won't give Cameron any more
   wedgies as long as the payoffs continue.
   $183,387
   The donor: FleetBoston Financial Corp., New England's largest
   financial institution. Its namesake, the FleetCenter, will play host
   to this year's Democratic National Convention.
   The kickback: From his perch on the Senate Finance Committee, Kerry
   backed the 1999 merger between Fleet and Bank Boston despite strong
   local opposition.
   $154,160
   The donor: Time Warner, the hobbled media giant that makes sure you've
   got mail, magazines, and a coaxial cable up your ass.
   The kickback: Kerry voted for FCC reform that paved the way for the
   lifting of ownership restrictions on media companies, then later
   publicly denounced such reforms. Now, there's a Man of the Year
   candidate!
   $137,058
   The donor: Hale and Dorr LLP, another Boston-based law firm that
   represents biotech and telecom companies, including Nortel Networks.
   The kickback: H&D gets two bangs for its buck with Kerry; he's helped
   to get wireless companies more airwave access and to relax export
   regulations for biotech companies.
   *All numbers are based on individual, corporate, and PAC contributions
   to Citizen Soldier Fund and Kerry's Senate and presidential campaigns
   (through January 31, 2004).
   Texas: The Big Enchilada                                       
   What makes Texas America's superstate? Here are a few reasons...
   SOLDIERIN'
   Texas houses more troops than any other state, and one in 10 jarheads
   is a Texan.
   POLITICAL CLOUT
   For five of the last 16 terms, a Texan has been Speaker of the House,
   meaning so much pork that the state has trichinosis.
   ENERGY
   Most states import oil and gas. Guess where it's from?
   BUSINESS
   Eighteen Fortune 500 companies are based in Houston. Only New York
   City has more.
   THE BORDER
   Nearly half of all NAFTA trade either originates in or is destined for
   Texas. It also means an endless supply of cheap, nonunion labor.
   Yee-haw!
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   http://www.maximonline.com/grit/articles/article_5831.html
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