[Congressional Record Volume 150, Number 21 (Wednesday, February 25, 2004)]
[House]
[Pages H609-H615]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




      PENTAGON OPENS CRIMINAL FRAUD INVESTIGATION INTO HALLIBURTON

  The SPEAKER pro tempore (Mr. Bishop of Utah). Under the Speaker's 
announced policy of January 7, 2003, the gentleman from New Jersey (Mr. 
Pallone) is recognized for 60 minutes as the designee of the minority 
leader.
  Mr. PALLONE. Mr. Speaker, earlier this week the Pentagon did 
something that the House Republican leadership should have done many 
months ago, and that is they opened a criminal fraud investigation into 
Halliburton. The Pentagon is expected to investigate the overcharging 
of at least $61 million for fuel shipped from Iraq to Kuwait. 
Halliburton has also been accused of charging the government for meals 
it never served at dining facilities in Iraq and Kuwait. The company 
agreed to reimburse the government $27.4 million for potential 
overcharges related to the meals and $6.2 million to cover other 
potential overcharges.
  Now, Mr. Speaker, all I can say is it is about time. I have been 
coming to the floor with a group of my Democratic colleagues to 
highlight these possible overcharges by Halliburton and called on the 
House Republican leadership to hold open hearings on whether or not 
Halliburton is overcharging the American taxpayer with its 
reconstruction work in Iraq. Instead, the Senate and the House, both 
controlled by Republicans, continue to turn a blind eye to possible 
waste and mismanagement by Halliburton in Iraq. Congressional 
Republicans even refuse to question the Bush administration on the 
billions of dollars of taxpayer money now going to Halliburton, much 
less create any special committee to oversee these funds.
  I ask you, Mr. Speaker, what are my Republican colleagues afraid of? 
Why do they refuse to hold Halliburton accountable for the billions it 
is now spending in Iraq? Could it be that congressional Republicans do 
not want to draw more attention to the fact that the company profiting 
from the reconstruction of Iraq, Halliburton, has close ties to Vice 
President Cheney? Back in 2002, Vice President Dick Cheney said these 
words, and I quote, ``Halliburton is a fine company, and I am pleased 
that I was associated with the company.''
  Now, how can the Vice President say that Halliburton is a fine 
company? Let us look at some of the facts.
  Fact number one: Halliburton has acknowledged that it accepted, and I 
quote, ``accepted up to $6 million in kickbacks in its contract work in 
Iraq.''
  Fact number two: Halliburton is now being investigated by the 
Pentagon for overcharging the American government for its work in Iraq.

[[Page H610]]

                              {time}  1800

  Fact No. 3, Halliburton faces criminal charges in a $180 million 
international bribery scandal during the time that Cheney was the CEO 
of the company.
  Fact No. 4, Halliburton has been repeatedly warned by the Pentagon 
that the food it was serving 110,000 U.S. troops in Iraq was dirty, and 
a Pentagon audit found blood all over the floor of the kitchens 
Halliburton supplies over in Iraq.
  Fact No. 5, Halliburton is getting around an American law that 
forbids doing business with rogue nations. Thanks to a giant loophole, 
Halliburton is able to do business with Iran, of all nations, through a 
subsidiary in the Cayman Islands.
  Mr. Speaker, how can the Vice President characterize Halliburton as a 
fine company? One has to wonder since Vice President Cheney seems to 
condone such conduct if the company was any different when he was in 
charge. It probably makes sense for the Vice President to continue to 
praise Halliburton considering that the company continues to pay the 
Vice President hundreds of thousands of dollars each year. Vice 
President Cheney tried to squash such a story when he appeared on Meet 
the Press last year. He stated, ``And since I left Halliburton to 
become George Bush's Vice President, I have severed all of my ties with 
the company, gotten rid of all my financial interest. I have no 
financial interest in Halliburton of any kind, and have not had now for 
over 3 years.'' That was the Vice President's quote on Meet the Press.
  But despite the Vice President's claims, the Congressional Research 
Service issued a report several weeks later concluding that because 
Cheney receives a deferred salary and continues to hold stock 
interests, he still has a financial interest in Halliburton. In fact, 
if the company were to go under, the Vice President could lose the 
deferred salary, a salary he is expecting to continue to receive this 
year and next year. While losing around $200,000 a year might not put a 
dent in the Vice President's wallet, he clearly still has a stake in 
the success of Halliburton.
  The Vice President also neglects to mention that he continues to hold 
more than 433,000 stock options. The Congressional Research Service 
reports that these stock ties ``represent a continuing financial 
interest in those employers which make them potential conflicts of 
interest.''
  This was not the first time that Vice President Cheney has 
misrepresented his role in Halliburton. Just last month the Vice 
President stated, in reference to government manipulation by 
Halliburton during his tenure, ``I would not know how to manipulate the 
process if I wanted to.'' But what the Vice President neglects to say 
is that Halliburton cashed in after Cheney took over Halliburton. Under 
Cheney's leadership, Halliburton doubled the value of its government 
contracts. According to a report by the Washington-based Center for 
Public Integrity, the company took in revenue of $2.3 billion on 
government contracts, which was up $1.2 billion from the 5-year period 
before the Vice President arrived.
  It is possible that Halliburton is the right company to do this work, 
but then how does the Bush administration and the Republican Congress 
explain why there is so much secrecy surrounding the whole deal? Could 
it be that the Republican Congress and the Bush administration are 
concerned that the more light that is shed on Halliburton's use of 
taxpayer money, the more examples of waste and mismanagement are likely 
to be exposed?
  Mr. Speaker, earlier this month since congressional Republicans 
refused to hold hearings on the billions of dollars handed over to 
Halliburton with no oversight, my Democratic colleagues in the other 
Chamber held a hearing in which a former Halliburton employee testified 
about the company's practices. Mr. Bunting purchased supplies for 
Halliburton in Kuwait last summer. According to Bunting, Halliburton 
spent too much on supplies for the reconstruction effort in part 
because it wanted to avoid seeking competitive bids from government 
suppliers. Bunting charges that Halliburton's supervisors wanted 
purchasers to buy from a preferred list of companies in Kuwait even 
when those companies charged high prices. Supervisors also told their 
workers to keep most purchase orders below $2,500 so that the company 
would not have to seek bids from multiple vendors. Now Bunting is a 
former employee of Halliburton's, and he is telling a group of 
Democratic Senators that the company is overcharging the American 
taxpayer.
  Even with all of this information, the House Republicans continue to 
allow Halliburton to receive billions of dollars without any oversight 
from Congress. If Democrats were in the majority in the House, we would 
definitely be making sure that Halliburton was no longer ripping off 
the American taxpayer. In fact, if it had not been for the resourceful 
work and the dedication of two of my colleagues, Halliburton would 
still be robbing the taxpayers blind with outrageous gasoline prices.
  Last year two of my Democratic colleagues on the Committee on Energy 
and Commerce, a committee on which I serve, the gentleman from Michigan 
(Mr. Dingell) and the gentleman from California (Mr. Waxman) exposed 
the outrageous fact that Halliburton was inflating gasoline prices at a 
great cost to American taxpayers. In a letter to the OMB Director Mr. 
Bolten, the gentleman from Michigan (Mr. Dingell) and the gentleman 
from California (Mr. Waxman) wrote that the independent experts that 
they consulted have been appalled to learn that the U.S. Government has 
paid Halliburton $1.62 to $1.70 to import gasoline into Iraq.
  According to these experts, the price that Halliburton was charging 
the gasoline is outrageously high, potentially a huge rip-off, and 
highway robbery. During the relevant period, the average wholesale cost 
of gasoline in the Mideast was around 71 cents a gallon, meaning that 
Halliburton was charging over 90 cents per gallon just to transport the 
fuel into Iraq. Let me just repeat that again. The U.S. Government was 
paying Halliburton $1.62 to $1.70 to import gasoline into Iraq, but at 
that time the wholesale cost in the Middle East was around 71 cents a 
gallon. So Halliburton was charging 90 cents per gallon more just to 
transport the fuel from Kuwait. There is no way that could be 
justified. According to the experts, this exorbitant transportation 
charge is inflated many times over.

  Compounding the cost to the taxpayers, this expensive gasoline is 
then sold to Iraqis at a price of just 4 to 15 cents per gallon. 
Although Iraq has the second largest oil reserves in the world, the 
U.S. taxpayers are in effect subsidizing over 90 percent of the cost of 
gasoline sold in Iraq. This is just incredible when we think about it.
  Mr. Speaker, in light of this new information, the gentleman from 
California (Mr. Waxman) and the gentleman from Michigan (Mr. Dingell) 
requested that OMB Director Bolten provide copies of all contracts, 
task orders, invoices and related documents issued to date regarding 
Halliburton's work in Iraq. The purpose was so Congress could conduct 
its own independent investigation of these issues on behalf of the U.S. 
taxpayer.
  There is no question that this request from my Democratic colleagues 
was reasonable. After all, if Halliburton was grossly overcharging the 
American taxpayer for the transportation of oil, it was highly unlikely 
that the overcharges ended there. Over the past couple of months, we 
have learned of lots of other overcharges; and yet still my Republican 
colleagues are silent on the issue. We do not see the waste watchers, a 
group of Republicans who come down to the floor periodically to rail 
against waste in the Federal Government, a government that they 
currently control, and we do not see them coming down to the floor to 
rail about Halliburton's gouging of the Federal purse. We do not see 
any Republicans expressing the need for more congressional oversight of 
the current contracts going to Halliburton and others, even though 
these problems continue to be exposed in the media on a regular basis.
  Mr. Speaker, it just appears to be another example of how the House 
Republicans have taken this House away from the people and handed it 
over to an elite few, corporate executives and other interests. I do 
not know how many more days are going to go by or how many more weeks 
are going to go by with continuing charges, often backed up in the 
media, about what

[[Page H611]]

Halliburton is doing and how it is abusing its situation in Iraq before 
the Republicans in this body finally demand that there be some 
oversight and some hearings to look into these issues.
  Mr. Speaker, again we have a huge deficit. We have a lot of spending 
needs. How can we possibly justify continuing to waste this money on 
behalf of Halliburton? It just does not make any sense.
  Mr. Speaker, I see the gentleman from Ohio (Mr. Brown) is here, and I 
yield to the gentleman.
  Mr. BROWN of Ohio. Mr. Speaker, I thank the gentleman. The gentleman 
from New Jersey (Mr. Pallone) has put this into a perspective to sort 
of understand the whole operation in Iraq and what it has meant to this 
company which had very close ties to private citizen Mr. Cheney, and 
still has very close ties to Vice President Cheney. That context would 
be this: We are spending about 1.5 billion taxpayer dollars in Iraq 
every week, about $1.5 billion every week in Iraq. Some of it is 
military, some of it is construction, a whole host of activities in 
Iraq.
  Not nearly enough of that money goes, frankly, for body armor for our 
soldiers. As we have seen with the Halliburton scandals, not nearly 
enough of that money goes to feed or house the troops, or for 
protective armor on Humvees. We also know where a lot of the money is 
going. Approximately one-third of the billion and a half, close to $500 
million per week, is going to private contractors. Not the Pentagon, 
not government employees, not soldiers, not what we traditionally think 
of as a military operation; $500 million roughly per week is going to 
private corporations. Many of those contracts for these private 
corporations are unbid contracts. A decision is simply made, possibly 
by Vice President Cheney, who was CEO at Halliburton and still is on 
the Halliburton payroll. Some of that money is given in unbid contracts 
to Halliburton and other companies. Halliburton has $2 billion in unbid 
contracts.
  I have had regular meetings with Guard and Reserve families in my 
district. I do not think that the public understands, nor did I before 
I met with some of these families, when someone is in Iraq as a Guard 
or Reserve member, it almost always creates financial hardship for 
their family stateside. In other words, if you are making $30,000 or 
$40,000 working here, you give up that salary and go to Iraq with the 
Guard or Reserve, your family has significant financial pain as a 
result of your going overseas.
  One woman told me her husband was driving a truck as a National Guard 
member, getting paid about $1,500 a month, between Kuwait and Iraq. 
Next to him was another gentleman driving a truck that worked for Brown 
& Root, a subsidiary of Halliburton, who was paid about $7,000 a month. 
The guy working for the taxpayers for the armed services in our Army 
was obviously wearing a uniform and getting paid $1,500 a month, and 
was a target of obviously terrorist acts and Iraqi sharpshooters and 
suicide bombers. The civilian was less of a target because he did not 
have a military uniform on and was paid four or five times as much.
  That is what this privatization of the military has done, coupled 
with the fact that not only is he paid that $7,000, Halliburton is able 
to charge cost plus. They are able to charge the government the $7,000 
plus a certain profit markup. So the more that they pay their private 
civilians, this truck driver or their executives especially who are in 
Iraq, the more they can add on to the price, the cost to the taxpayers, 
as a result of these cost plus contracts.
  So we have Halliburton as a private contractor bringing in billions 
of taxpayer dollars, and we have the Vice President of the United 
States who still is on the Halliburton payroll. When you think about 
that, we as a Nation, our taxpayers are funding unbid contracts to one 
of America's largest companies which has direct ties to the Vice 
President of the United States, it is a pretty incredible phenomenon, 
something the national media which generally does not like, and some of 
the national media are actually owned by defense contractors. GE owns 
NBC, for example, so it is no surprise they do not want to talk about 
that, and the list goes on.
  The fact is that Halliburton, a company which has gotten literally a 
couple of billion dollars in private contracts, has close ties to Vice 
President Cheney.
  Let me mention a couple of comments, and then let me mention a couple 
of other facts.
  Vice President Cheney said before the election, ``What I will have to 
do, assuming we are successful in the election, is divest myself, that 
is sell my remaining shares that I have in the company.''

                              {time}  1815

  CNN reported in late 2003, a congressional report found that Cheney 
still owns, quote, more than 433,000 Halliburton stock options, 
including 100,000 shares at $54.50 a share, 33,333 shares at $28 a 
share and 300,000 shares at $39.50 per share. This is a company that 
gets billions of dollars in unbid contracts, the decision being made, 
perhaps by the Vice President, perhaps by the President, certainly 
somebody at the White House, and he has stock options in this company. 
That is one example.
  Mr. Cheney early this year said, ``I severed my ties with Halliburton 
when I became a candidate for Vice President in August of 2000.'' He 
said that this year. Yet CNN reported along with 433,000 stock options, 
Cheney still receives $150,000 a year from Halliburton. The Vice 
President of the United States is paid $3,000 a month from a company 
that gets billions of dollars in unbid contracts of taxpayer dollars. I 
am not saying that Vice President Cheney is making all these decisions 
because he is on their payroll, but he is on their payroll. He 
receives, not $3,000 a month, $3,000 a week, $150,000 a year, $3,000 a 
week by Halliburton, yet these unbid contracts continue.
  He also said this during the campaign: ``What happens financially by 
joining the ticket with Governor Bush obviously means I take a bath in 
one sense,'' meaning he was going to make less money. The New York 
Times said Halliburton has agreed to let Mr. Cheney retire with a 
package worth an estimated $20 million according to people who reviewed 
the deal. This contract is still giving and giving and giving and 
giving.
  One more example. Then private citizen Cheney in August of 2000: 
``I'll do whatever I have to do to avoid a conflict of interest. I'll 
eliminate the conflict, I can assure you. I've said repeatedly I will 
not tolerate or be a party to a conflict of interest while I'm Vice 
President. I'll do whatever I have to do to resolve that conflict.'' 
CNN just a few months ago said a congressional report found that more 
than 433,000 stock options he possesses is considered among the ties he 
retained or linkages to former employers that may represent a 
continuing conflict of interest. I do not know which is more astounding 
or which is more outrageous and which is, frankly, more immoral, the 
fact that he continues to get paid by this company while shoveling 
billions of taxpayers' dollars in unbid contracts to this company or 
the fact that Vice President Cheney is not telling the truth about it.
  This is an administration, as we are learning more and more, that 
falls short of telling the truth. Vice President Cheney did not tell 
the truth about his willingness to cut ties with his company. He did 
not tell the truth about the unbid contracts. He is not telling the 
truth about the money he is still receiving from Halliburton.


                Announcement by the Speaker Pro Tempore

  The SPEAKER pro tempore (Mr. Burgess). The gentleman will suspend.
  The Chair must caution that it is not in order to refer to the Vice 
President in terms that are accusatory or personally offensive.
  Mr. BROWN of Ohio. Mr. Speaker, I do not understand what that means. 
I appreciate the Speaker's comments. So if the Vice President said 
something and did another, I may say that; but if he said something and 
did another, I cannot say that he lied about it?
  The SPEAKER pro tempore. The Chair would instruct that the gentleman 
should refrain from saying the Vice President did not tell the truth.
  Mr. BROWN of Ohio. I would ask the Chair for advice on how I speak. 
If the President said something and did something else, if I am not 
supposed to say he did not tell the truth, what phraseology does the 
Chair allow me to use in this, I thought, open forum, open body where 
people can speak freely?

[[Page H612]]

  The SPEAKER pro tempore. The gentleman understands that it is not the 
purpose of the Chair to construct his remarks for him. The Chair would 
merely caution the gentleman that terms that are accusatory or 
personally offensive should not be permitted in the body.
  Mr. BROWN of Ohio. I think it is pretty offensive that the Vice 
President is still receiving $3,000 a month from a company which is 
getting billions of dollars in unbid contracts and he is telling us he 
has severed ties with that company. I guess I will not say the Vice 
President lied about it. I am not allowed to say that. I do not quite 
know how to describe it. But let me move to something else.
  So we have an administration where the Vice President has done what I 
just said. We have an administration where the President has said the 
Medicare bill would cost $400 billion; and I do not want to say the 
President lied, but then the Medicare bill we find out 7 weeks later 
cost $530 billion. We find that the President told us one thing about 
Iraq, I do not want to say he lied, either, but then we find out 
something else entirely different about Iraq.
  We hear, and I would mention this, on the front page of a generally 
pretty conservative newspaper in this city, that the President's 
people, the administration said just a couple of years ago, way after 
September 11, we would have 3.4 million more jobs created in 2003 than 
there were in 2000, yet it turns out we have had 1.7 million jobs 
fewer. I do not want to say the administration did not tell the truth 
about that, but their predictions were way, way off. Then the President 
said, the administration said, the budget deficit would be $14 billion. 
It has turned into being $521 billion.
  Mr. Speaker, I think we are seeing here a habit of prevarication, a 
tendency to tell us one thing and see something else, whether it is the 
Medicare bill, whether it is Iraq, whether it is the President's 
connections with this company that is getting billions of taxpayers' 
dollars and giving to the Vice President $3,000 a week and millions of 
dollars in stock options. It just does not really quite add up.
  Mr. PALLONE. I appreciate my colleague from Ohio's comments. 
Regardless of how he has to phrase it, I think the bottom line is that 
there is a major inconsistency between what the Vice President said and 
what the reality is in terms of the amount of money and his connections 
to Halliburton. I have to say, though, ``60 Minutes'' did a report, I 
guess this was at the end of January, and I know that many of us have 
mentioned this before about this Halliburton subsidiary that is doing 
business with Iran. To me, although everything that we have mentioned 
is pretty bad, when this came out on the ``60 Minutes'' program back at 
the end of January, I was really more outraged by this than even all 
the other things that Halliburton was involved with.
  This was on January 25, as I said, on ``60 Minutes.'' Correspondent 
Leslie Stahl who was doing the report, the concern was on behalf of 
William Thompson, the New York City comptroller who oversees the $80 
billion in pension funds for New York City workers or employees. What 
he was speaking about was the fact that New York City employees' 
pension funds are basically invested in several companies, including 
Halliburton, that through subsidiaries do business with the countries 
that President Bush has referred to as rogue nations, such as Iran and 
Syria, Libya and others. I just wanted to zero in on Halliburton. We 
could talk about the others, but tonight we are talking about 
Halliburton because of the potential conflict of interest with the Vice 
President.
  What was said on ``60 Minutes,'' again, and this is a quote, in the 
case of Halliburton as an example, this is Mr. Thompson speaking, they 
have an offshore subsidiary in the Cayman Islands that does business 
with Iran. That subsidiary, Halliburton Products and Services, Ltd., is 
wholly owned by the U.S.-based Halliburton and is registered in a 
building in the capital of the Cayman Islands, a building owned by the 
local Caledonian Bank. Halliburton and other companies set up in this 
Caribbean island because of tax and secrecy laws that are corporate-
friendly.
  Apparently the law says that an American company cannot do business 
with one of these rogue nations such as Iran, but you can get around it 
in some way because the law does not apply to any foreign or offshore 
subsidiary so long as it is run by non-Americans. But I would venture 
to say that even that loophole is being violated by Halliburton in this 
case because in this ``60 Minutes'' interview, I guess they actually 
went to the subsidiary in the Cayman Islands and they were not allowed 
to enter the building with a camera so they went in with a hidden 
camera and were introduced to David Walker, the manager of the local 
bank where the subsidiary is registered.
  ``60 Minutes'' figured, well, they would find some kind of operation 
here, some kind of business, but to their surprise they were told by 
David Walker, the manager of the bank, that while Halliburton Products 
and Services was registered at this address in the Cayman Islands, it 
was in name only. There was no actual office there or anywhere else in 
the Cayman Islands and there were no employees on the site. They were 
told, the ``60 Minutes'' reporters, that if mail for the Halliburton 
subsidiary comes to this address that they reroute it to the 
Halliburton headquarters in Houston.
  Mr. Walker went on to say, the bank manager, and I quote, ``If you 
understand what most of these companies do, they're not doing any 
business in Cayman per se. They're doing international business,'' says 
Walker. Would it make sense to have somebody in Cayman pushing paper 
around? I do not know. And it is mostly driven by whatever the issues 
are with the head office.
  So what is basically happening here is the head office in Houston of 
Halliburton is calling the shots. Nobody is working at this local 
subsidiary. It does not even have an office. It has simply been set up 
so that Halliburton can do business with Iran. Think about it. Iran is 
on the list of rogue nations. You cannot do business with them. Of 
course, Iran exports terrorism around the world. So essentially 
Halliburton is benefiting from terrorism. Here we are. The President 
said that the reason we went into Iraq was because of the war against 
terrorism. The biggest company that has the contracts, no-bid 
contracts, in Iraq is Halliburton, which was formerly headed by Vice 
President Cheney. They set up a subsidiary, probably contrary to the 
laws of the United States, that does business in Iran and Iran exports 
terrorism around the world, probably into Iraq as well, for all I know.
  To me, it is unimaginable to think that the United States taxpayer is 
paying this company Halliburton which has had all these abuses but the 
biggest abuse of all in my opinion is that they are getting around the 
law and making money in Iran, which in turn is exporting terrorism that 
could potentially be used against the United States.
  I see my colleague from Washington State is here. I am pleased to see 
that he is joining with us tonight and would yield to him.
  Mr. McDERMOTT. I appreciate this opportunity to come talk, because I 
think that we saw on Sunday that the campaign we are about to enter 
into is one in which, one of the themes of this administration is going 
to be integrity. Integrity is a very interesting thing for them to run 
on. As one of the earlier speakers said, it is a good thing the White 
House is not made out of glass, because they would be sitting in 
shattered glass all over the place by the time this campaign is over. 
The issue you started on, you stopped. You did not tell the whole 
story. ``60 Minutes'' said, okay, so there is nothing going on in the 
Cayman Islands. Where is this being run from? Then they get a letter 
from Halliburton that says, well, the Cayman Islands subsidiaries 
actually run out of Dubai. So they get on a plane, they fly to Dubai, 
and they learn that this office shares office space and phone and fax 
lines with a division of the U.S. parent company which raises all kinds 
of questions about how independent is that. You put that there with the 
statement that the Vice President made, ``I have a firm policy that I 
wouldn't do anything in Iraq even in arrangements that were supposedly 
legal. We've not done any business in Iraq since the sanctions were 
imposed and I have a standing policy that I wouldn't do that.''
  That is a quote from 8/27/2000. This is while he is in the middle of 
the campaign. This is the man who wants to

[[Page H613]]

run on his integrity. According to oil industry executives, this is 
from The Washington Post. That is a minor newspaper that has a little 
something to say about what is going on in this town. According to oil 
industry executives and confidential U.N. records, however, Halliburton 
held stakes in two firms that signed contracts to sell more than $73 
million in oil production equipment and spare parts in Iraq while 
Cheney was chairman and the chief executive of the Dallas-based 
company. Two former senior executives say that, as far as they know, 
there is no policy against doing business with Iraq.
  You tell me that a company that is running a billion dollar operation 
has people who are executives and do not know that there are sanctions 
on Iraq? How bald can you be in what you are willing to say, whether it 
has any connection to what the facts are or not? Those Halliburton 
subsidiaries joined dozens of American and foreign-owned supply 
companies that helped Iraq increase its crude oil exports from 4 
billion in 1997 to 18 billion in 2000.

                              {time}  1830

  The Vice President made a flat statement, I have a firm policy I 
would not do anything in Iraq. Meanwhile his company is helping Iraq 
quadruple its export of oil. This is the man whose integrity really 
runs deep, and he says I have nothing to hide or anything, but when it 
comes to meetings that they had in the White House on developing an 
energy policy, closed meetings, only invited the industry in, and they 
are developing the energy policy for the United States of America, a 
country that is addicted to oil, and when the Congress says we would 
like to see what those papers are that you did in there, he says, oh, 
no, that is executive privilege, I cannot show you what we are doing.
  They took us to war, at least in part, on the basis of oil and the 
United States wanting to control oil. All we have to do is look at the 
machinations of Unical bringing a pipeline down through Afghanistan and 
then putting Hamid Karzai as the President who was, imagine that, an 
old Unical guy. He made $600,000 off Unical. And then we go over to 
Iraq and we see all the machinations there, and here is Halliburton in 
there, in the oil business, before the war started. And then we have 
the audacity to be told sitting in this room that there is an axis of 
evil out there, Iraq, Iran, and North Korea, and the very people 
sitting here have been doing business with Iraq and Iran.
  Tell me about integrity. How are the American people going to believe 
any of that stuff? Still drawing pay from them, sitting in this room, 
occupying a seat of honor and importance, and doing business with the 
axis of evil. This is the man who says, I want to run on integrity.
  And then just to complicate it further, the court case to try to get 
those reports away from him goes up to the Supreme Court. So he calls 
up his friend over at the court, Justice Scalia, and says, hey, how 
would you like to go duck hunting? Come on over and get over on Air 
Force II, and we will fly down to Louisiana. I have got a place down 
there, and I will put you up for the weekend, and we can shoot ducks.
  Now, how can anybody have any belief in integrity when people stand 
up there and say there is not an appearance of impropriety with the 
Vice President, with a case before the Supreme Court, taking one of the 
Justices down on a private hunting trip for the weekend? What do my 
colleagues think they talked about, ducks? Maybe. Maybe they talked 
about the New Orleans Saints, or Mardi Gras is coming. I am sure 
business never come up. They spent 3 or 4 days down there, and they 
never talked about any of the problems that the country faces. Can one 
imagine that, that the Vice President of the United States and one of 
the Justices on the Supreme Court would sit and talk about fluff for 4 
days and never discuss how this man can have the gall to say I want to 
run on integrity when he makes these kinds of flat statements?
  The whole career, the whole business of the issue, if we could ever 
get an investigation in the House into what went on in giving us the 
information about weapons of mass destruction, we will find his fingers 
all over it from trips he made out to Langley to the CIA, and then 
everybody stands around and says we were misled. We were given all this 
bad information. Come on, give me a break. You are big boys, and you 
cannot have it both ways. You cannot talk out of both sides of your 
mouth.
  Ultimately the people will figure it out. Abraham Lincoln said, ``You 
can fool some of the people all of the time and all of the people some 
of the time, but you cannot fool all of the people all of the time.'' 
The end is coming for this integrity of the oil destiny.
  I yield back and thank the gentleman for giving me a chance to talk 
about the Vice President.
  Mr. PALLONE. Mr. Speaker, I appreciate what the gentleman said. And 
sometimes I think that we forget that not only these abuses are going 
on, but the circumstances in which they are going on, and all this 
money is being wasted.
  And there was an editorial in the New York Times, I guess, January 
30, and I am not going to read it all, but just the end. The whole 
thing was about Halliburton and all their abuses, and they wanted to 
remind us, and I would like to remind us, just by quoting a couple of 
sentences, ``The United States is at war. The government is running 
deficits. Money is tight everywhere. But Halliburton won't even kick in 
its fair share. It continues to benefit from the Nation's largesse, 
while scouring the world for places to shelter as much of its American 
riches as possible.''
  It is bad enough that they have a subsidiary that is doing business 
in Iran and that there are all these overcharges and abuses, but keep 
in mind that this is happening while we are at war, the government is 
running record deficits, and money is tight, and things that we really 
need to spend Federal dollars on cannot be provided for, and in the 
middle of this they are involved in all this abuse.
  I yield to the gentlewoman from Illinois (Ms. Schakowsky), who has 
been down here many times to address this same issue.
  Ms. SCHAKOWSKY. Mr. Speaker, I thank the gentleman from New Jersey 
(Mr. Pallone) for allowing me to share my thoughts on this.
  I wanted to begin with something that may seem a little bit off 
point. I just returned from the White House meeting along with the 
Congressional Black Caucus that was kind enough to let me come along, 
in a meeting with Secretary of State Colin Powell and Condoleezza Rice 
and the President, and we were talking about the crisis in Haiti right 
now. And one of the reasons now given for our going to Iraq was to 
liberate Iraq, to bring democracy to Iraq. And we stand here right now 
at a moment when violence and thugs and M-16s are moving toward the 
palace of the democratically elected President of Haiti, Mr. Aristide, 
and there seems to be a reluctance for the United States now to get 
involved in saving a democracy.
  Whatever one thinks of Mr. Aristide, some of us do not like some of 
the things the President does, or we are talking about the Vice 
President tonight, but we are going to wait until November, until there 
is another election. We are not even so sure about the last election. 
They talk about some irregularities in the Haitian election in 2000. We 
think there were some here, too, but we do not do anything. And I got 
to thinking that what if there was some oil in Haiti? Maybe there would 
be a little more interest on the part of the United States in really 
doing something.
  Our hope is that the President understands, and I know he 
understands, but that in the light of there being an imminent bloodbath 
in Haiti, that the United States takes some action. It would be pretty 
ironic if we were trying to bring democracy to Iraq and yet we let 
democracy crumble in Haiti.
  Let me get back to the point. I have been watching these ads on 
television that Halliburton has been putting on. They are pretty glossy 
ads, and they show soldiers, handsome young men and women, getting 
meals that Halliburton says that it is providing to our soldiers; and 
says that Halliburton has been doing all this great work, and I am sure 
that over the years they can proudly point to some of their 
accomplishments. But they are bragging about meals right now, and what 
we have found out now is that, yes, they provide meals, but they have 
also been

[[Page H614]]

charging for three times as many meals as were actually served in a 
major Army facility in Kuwait, that American taxpayers are paying 
millions and millions of dollars to Halliburton for meals that simply 
never got served. Whoops, a little mistake. Or is it just a mistake?
  Maybe the gentleman has referred to it already, and he can stop me if 
he has, but the gentleman from California (Mr. Waxman) has been doing a 
wonderful job in calling for investigations of these overspendings on 
behalf of the American taxpayers. We should not be paying 1 cent more 
than we need to be spending, particularly in a war that, in my view, we 
should not have been involved in in the first place. But there we are, 
and Halliburton is there, too.
  So he, along with the distinguished gentleman from Michigan (Mr. 
Dingell), sent a letter on February 12 to the Director of the Defense 
Contract Audit Agency asking them to look into some of the problems 
based on information that was provided to them by whistleblowers. It is 
not always so easy to be a whistleblower, to stand up and risk one's 
job and sometimes risk all kinds of retribution to tell what is really 
going on.
  Halliburton deserves scrutiny. They were awarded in 2001 a global 
logistics contract worth about $3.7 billion, 90 percent of this total 
value for work in Iraq, and here is what these whistleblowers are 
saying that Halliburton is doing: that they are engaging in these 
improper practices, telling employees that price does not matter. This 
is from the letter: ``High-level Halliburton officials frequently told 
employees that the high prices charged by vendors were not a problem 
because the U.S. Government would reimburse Halliburton's costs and 
then pay Halliburton an additional fee. One whistleblower said that a 
Halliburton motto was `Don't worry about price. It's cost-plus,' '' 
which means they not only get their costs, but, on top of that, some 
profit. So do not worry about it.
  ``Wasteful spending: Ordinary vehicles were leased for $7,500 a 
month. Higher prices than necessary were paid for furniture and 
cellular phone service. Poor quality mobile homes were purchased and 
accepted even though much better units were available. Under 
Halliburton's cost-plus contract, all of these wasteful expenditures 
were passed on to the taxpayer. The company even sought to order 
embroidered towels at a cost of $7.50 each when ordinarily towels would 
have cost about one-third of the price.''
  Those of us who are involved in decorating our homes, maybe once in a 
while we are going to splurge on an embroidered towel. I do not think 
that we need to do that when we are trying to be cost-effective in a 
war in Iraq and have a little money left over to help some people at 
home.
  ``Avoiding competition among vendors: Halliburton's objective was to 
keep as many purchase orders as possible below $2,500 in value . . .'' 
Because they are being frugal? No. The letter goes on to say: `` . . . 
so its buyers could avoid the requirement to solicit quotes from more 
than one vendor. Instead of having multiple vendors submit competitive 
quotes for needed materials and selecting the lowest quote, Halliburton 
frequently sought only one quote from a single vendor.''
  ``Inviting unjustifiably high quotes: It was routine for Halliburton 
buyers to copy a requisition, hand it to a single Kuwaiti vendor, and 
tell the vendor to submit any quote below $2,500 the next day. The 
focus was not on obtaining a reasonable price.''
  And there is a lot more in this letter, but in the summary here, it 
says, ``Relying on an inadequate list of preferred vendors: 
Halliburton's supervisors provided buyers with a list of preferred 
Kuwaiti vendors. Many of the preferred firms were unreliable or charged 
`outrageous' prices. Supervisors did not encourage buyers to identify 
alternative vendors and, in some cases, wanted to use a higher-priced 
vendor on the preferred list rather than a new, cheaper vendor.
  ``According to the whistleblowers, improved business practices would 
yield significant savings.''
  And they talk about ``Mr. Bunting,'' one of the whistleblowers, 
``estimated that competition could reduce costs by up to 15 percent. 
The former procurement supervisor explained that when he obtained three 
quotes instead of just one, he typically saved up to 30 percent.'' So 
we are paying top dollar, unnecessarily high prices.
  And just what is this company and its relationship to the Vice 
President? Because that is what we are talking about here today. The 
integrity of this administration is in question.

                              {time}  1845

  And when Mr. Cheney says in 2000, July of 2000, before the election, 
said, ``What I will have to do, assuming we are successful in the 
election, is divest myself, sell any remaining shares that I have in 
the company,'' the fact is a congressional report found that Mr. Cheney 
still owns more than 433,000 Halliburton stock options, including 
100,000 shares at $54.50 per share, 33,333 shares at $28.00, and 
300,000 shares at $39.50. That is from CNN in September of 2003.
  Then he says in January of this year, ``I severed my ties with 
Halliburton when I became a candidate for Vice President in August of 
2000.'' I do not know what ``severed'' means. I clearly do not 
understand the meaning of the word ``severed,'' because, to me, this is 
a pretty good and lucrative tie. ``Along with 433,000 stock options,'' 
and this is a quote from CNN, ``Cheney still receives about $150,000 a 
year'' from Halliburton.
  I would like people I may have severed ties from to have that kind of 
deal. Severed to me means no, I do not get any money, but that is 
clearly not the definition of the word to Mr. Cheney.
  So I think, look, there are just so many questions here, and I do not 
know if this issue would even come up so much if we could count on this 
company spending taxpayer dollars in the way that they should be spent. 
But it is not one issue, it is not two issues, it is time after time 
after time. Every time the light is shined on what Halliburton has 
done, we find taxpayer dollars that are being wasted there. We cannot 
afford to do that. The Vice President of the United States should take 
some responsibility for that. It is a company he was CEO of. This is a 
company he continues to gain benefits from, and I think it really does 
raise a matter of where does the buck stop, where is the responsibility 
and the accountability, and, fundamentally, it raises questions of 
integrity, of ethics.
  So I appreciate the gentleman letting me raise the issues.
  Mr. PALLONE. Mr. Speaker, I appreciate the gentlewoman coming down 
tonight to talk about this. I know she has done it before. Particularly 
when she raises the issues of the ads Halliburton is running, I have 
seen some of them, but I forgot about the fact in the middle of all 
this, they are spending money to basically tell people how wonderful 
they are while an investigation is going on. The bottom line is the 
Pentagon now is actually finally conducting an investigation. What you 
and I have said is we should have hearings here in the Congress.
  I go back again to that New York Times editorial that I mentioned 
before that says keep in mind that while Halliburton commits all these 
abuses, the United States is at war. I cannot imagine that if this was 
World War II or another major conflict, but I will use World War II as 
an example, it is what we call war profiteering, and anyone who was 
associated with that, we have seen the old movies where there is an old 
World War II movie where they picture the war profiteers. They are the 
enemies of the State. They are like no different in the public's mind 
than Nazi Germany or the countries that were fighting the United 
States, because they were making a profit at the expense of the 
taxpayers during a time of war.
  So, given the fact that all this has been exposed, and we do not have 
to go through the facts again, but everyone in the kickbacks on the 
contract work, which Halliburton actually admitted, the overcharging 
for the meals, the fact that you have the subsidiary and the 
questionable aspect that was brought up in 60 Minutes, why in the world 
are the Republicans not having hearings, bringing out how the United 
States might be wasting billions of dollars in a time of war?
  I do not even have to add the deficit and the spending that we might 
want to see on other things more important for the average citizen. 
Just the fact this is happening at a time of war and

[[Page H615]]

this company may be making a profit on the war, it is just incredible 
to me.
  All we are asking is that our Republican colleagues in control of the 
House have some sort of hearings and bring this up. That is all that 
you mentioned in the letter from our colleagues on our committee, the 
gentleman from Michigan (Mr. Dingell) and the gentleman from California 
(Mr. Waxman), want. That is all they are asking be done, and still the 
Republicans refuse to do it.
  We are just going to come down here and continue to come down here 
until some effort is made by the majority party to have hearings and to 
have some accountability. We just cannot keep bleeding with all this 
money that is going into this company. It just does not make any sense.

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