[Congressional Record Volume 149, Number 127 (Tuesday, September 16, 2003)]
[Senate]
[Pages S11557-S11558]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




              VICE PRESIDENT CHENEY'S TIES TO HALLIBURTON

  Mr. LAUTENBERG. Mr. President, I rise to discuss a disturbing 
development that has just come to light. This development questions 
Vice President Cheney's continuing financial ties to Halliburton, the 
oil services company he once headed.
  This past Sunday, the Vice President made the following statement to 
Tim Russert on ``Meet the Press.'' I quote from that statement. The 
Vice President said:

       Since I left Halliburton to become George Bush's Vice 
     President, I've severed all of my ties with the company, 
     gotten rid of all of my financial interest. I have no 
     financial interest in Halliburton of any kind and haven't 
     had, now, for over three years.

  After he made that statement, my curiosity led me to take a look at 
the Vice President's financial disclosure records. What I saw in those 
reports was completely at odds with what he said on television Sunday 
morning. Vice President Cheney's official financial disclosure filings 
with the Office of Government Ethics reveals that not only does the 
Vice President continue to have financial ties to Halliburton but also 
that Halliburton is continuing to provide personal financial benefits 
to the Vice President.
  In the years 2001 and 2002, the Vice President received large 
``deferred salary'' payments from Halliburton. In 2001, Halliburton 
paid Vice President Cheney $205,298 in salary, and in 2002 Halliburton 
paid Vice President Cheney $162,392 in salary. He is scheduled to 
receive similar payments this year, 2003, and in 2004 and 2005. That is 
a pretty strong ``financial tie,'' in my view. If you ask every-day 
Americans if someone has a financial interest in a company that pays 
them annual compensation, I am certain the answer would be universally 
``yes.''
  Deferred salary is not a retirement benefit or a payment from a 
third-party escrow account but, rather, an ongoing corporate obligation 
that is paid from company funds. If a company were to go under, the 
beneficiary could lose the deferred salary.
  In an attempt to mitigate the Vice President's continuing financial 
interest in Halliburton, his financial statement disclosure form says 
he ``acquired'' an insurance policy ``to ensure that he will receive 
the equivalence of his remaining deferred compensation account with 
Halliburton.'' The terms of this insurance policy, its costs, and who 
paid for it are still unclear.
  In addition, Vice President Cheney continues to hold 433,333 
unexercised Halliburton stock options. At the end of 2002, Vice 
President Cheney's financial disclosure form stated he continued to 
hold these options, although the exercise prices are above the 
company's current stock market price. Even though these exercise prices 
are above current values, these options could in the future bring a 
substantial windfall, if Halliburton's earnings in stock value continue 
to grow as it benefits from large government contracts.
  This morning, I looked at a chart that showed Halliburton's stock 
value and its growth from October of last year until the current time. 
It has grown by about 75 percent while the rest of the industry has 
remained flat over the years.
  These options could bring, as I said, a substantial windfall if 
earnings in stock values continue to grow--I repeat--because of the 
value I find people have placed on Halliburton stock resulting in some 
pretty good contracts they have gotten in dealing with issues in Iraq.

[[Page S11558]]

  The Vice President has signed an agreement, he said, to donate any 
profits from these stock options to charity, and has pledged not to 
take any tax deduction for the donation. Alternatively, he doesn't have 
to pay taxes on the value growth he would have otherwise paid. But 
should Halliburton stock prices increase over the next few years, the 
Vice President could exercise the stock options for substantial profits 
benefiting not only his designated charity but also providing 
Halliburton with a substantial tax deduction.
  The issue is simple. Vice President Cheney claims he has no financial 
ties to Halliburton, but his own financial disclosure report says 
otherwise. The American people deserve to know about this relationship 
with Halliburton. He may argue he has structured deals to minimize his 
financial windfall from his Halliburton arrangements, but he clearly 
still has ``financial ties'' to the company.
  The fact that Halliburton received an enormous contract without a 
competitive bid or public disclosure--it was the subject of debate 
which we had on this floor--it was then agreed that all contracts 
dealing with Iraq and its reconstruction would be part of the public 
record.
  Back in May, I wrote to the chairman of the Governmental Affairs 
Committee requesting hearings on the no-bid contracts awarded to 
Halliburton in Iraq. I believe these developments now make it even more 
important for the Senate to hold hearings. I renew my plea to the 
Governmental Affairs Committee to hold hearings on the administration's 
initial contracts with Halliburton.
  Just this week, we learned that Halliburton's no-bid contract with 
the Army Corps has increased from $700 million to nearly $1 billion. It 
is a lot of money.
  The American people deserve answers to these serious questions 
concerning government ethics and accountability.
  I also believe it is in the interest of the administration to 
cooperate so the air can be cleared and the record set straight so we 
know once and for all whether the Vice President admits publicly that 
he has a financial tie with Halliburton or continues to deny it, 
despite the written record filed with the Senate Ethics Committee.

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