Harken’s Juicier than Whitewater

Written by Alexander Cockburn on . Posted in Miscellaneous, Posts.

The right
is whining. Carl Limbacher and his crew complain on the popular NewsMax site
that in the two weeks since the Harken story went critical, "the prestige
press" (Limbacher’s odd phrase, which presumably means he’s excluding
The National Enquirer) has given the affair 50 times more coverage than
it gave the Whitewater deal after The New York Times broke that
on March 8, 1992. Limbacher moans that Whitewater showed up only 14 times in
the wake of the Times story, while from June 28 to July 12 of this year
there have been more than 700 stories on the Harken sale.

Carl. The reason Whitewater got off to a slow start was because for months no
one could figure out what The New York Times’ Jeff Gerth was writing

any Gerth story is like bicycling through wet sand, but in the case of Whitewater
he surpassed himself. As readers sank up to their armpits in the sludge of Gerth-prose,
interest in Whitewater for that electoral year flickered and died. Gerth saved
Clinton’s ass. Ultimately Whitewater did make it into the headlines, but
in truth it always lacked sex appeal. There just wasn’t that much meat
in the stew. Not like Hillary’s commodity trades.

Just like
those trades, Harken is really easy to understand. Guy (the President) makes
a bundle selling stock in his company, which is going belly up, acting on insider
knowledge of the books, and also culled because his dad was in the Oval Office.
Guy forgets to tell the SEC. Same way with Cheney. No need to put in those daunting
phrases like "complex transactions." The simple numbers have serious

one precis of the situation that’s gone the rounds: "Cheney’s
2000 income from Halliburton: $36,086,635. Increase in government contracts
while Cheney led Halliburton: 91%. Minimum size of ‘accounting irregularity’
that occurred while Cheney was CEO: $100,000,000. Number of the seven official
US ‘State Sponsors of Terror’ that Halliburton contracted with: 2
out of 7. Pages of energy plan documents Cheney refused to give congressional
investigators: 13,500. Amount energy companies gave the Bush/Cheney presidential
campaign: $1,800,000."

But if anyone
can save Bush and Cheney it will be Gerth. Last week he and another Times
scrivener called Richard Stevenson managed the truly amazing feat of making
the Harken story complicated and boring. Here was the first paragraph:

Bush received two low-interest loans to buy stock from an oil company where
he served as a board member in the late 1980’s. He then benefited from
the company’s relaxation of the terms of one loan in 1989 as he was engaged
in the most important business deal of his career." Only 52 words and already
the air is whistling out of the tire. On and on the story trundled, until it
approached the famous SEC non-probe. You’ll recall from the 700-plus stories
lamented by Limbacher that W’s prolonged failure to report to the SEC the
sale that netted him $840,000 was viewed with indulgence by that agency, whose
boss had been appointed by President G.H.W. Bush, and whose counsel had worked
for W. It’s hard to bore people with material like that, as Paul Krugman
is discovering each week. Here’s how Gerth and Stevenson approached this
bit of the saga:

June 1990 Harken stock sale led to an investigation by the Securities and Exchange
Commission–during his father’s administration–of whether Mr.
Bush had knowingly sold the stock in advance of worse-than-expected financial
results that temporarily drove down Harken’s share price.

S.E.C. took no action against Mr. Bush."

Now mind
you, Harken is not a new story. Charles Lewis of the Center for Public Integrity
dealt with it long ago in his book The Buying of the President 2000.
Even back then Lewis speculated that the mystery institutional buyer of Bush’s
stock might have been Harvard Management–the overseer of the school’s
multibillion-dollar endowment. Lewis wrote, "A month after Bush came on
board, Harvard Management agreed to invest at least $20 million in Harken. It
would come to own some ten million shares of Harken stock, making it one of
the company’s largest investors. The Bush name may have helped seal the
deal… Harvard’s Harken investments in oil and gas would eventually
generate nearly $200 million in losses for the endowment." In other words,
Harvard Management lost staggering amounts in a bum investment that saved the
ass of the president’s son.

The broker
involved, Ralph Smith of Sutro & Company, has refused to name the buyer
of the Bush shares, though he has said it was an institutional investor. Lewis
reported that "at the bottom of a spreadsheet Smith used to record his
calls to Bush was the name of Michael Eisenson, along with the telephone number
of Harvard Management."

None of
this alluring stuff holds appeal for Gerth and his colleague, who simply wrote,
"In the case of the sale of his Harken stock, Mr. Bush benefited from the
action of an investor who remains unknown even today." A few days later
Gerth and Don van Natta Jr. were at it again, this time paralyzing Times
readers with a narcotic narrative about Halliburton. The lead was promising:

Halliburton Company, the Dallas oil services company bedeviled lately by an
array of accounting and business issues, is benefiting very directly from the
United States efforts to combat terrorism.

building cells for detainees at Guantanamo Bay in Cuba to feeding American troops
in Uzbekistan, the Pentagon is increasingly relying on a unit of Halliburton
called KBR, sometimes referred to as Kellogg Brown & Root."

the story was a bit like walking around some familiar room in the dark, tripping
over and then gradually recognizing bits of furniture. Through the choking fog
of Gerth-prose one could dimly descry the familiar landscape of Pentagon corruption,
with cost-plus bids, noncompetitive contract awards, manic overbilling and so
forth. Sen. Charles Grassley’s staff will be only too glad to send you
several thousand pages of testimony on such endemic corruption and fraud, a
goodly part of which stemmed from Al Gore’s efforts to reinvent government
by having recourse to the discipline and efficiency (heh heh) of the private

reason for the sense of familiarity was that the essentials of the story were
told in an exciting and accessible way several months ago by Jordan Green of
the Institute for Southern Studies, published in Facing South, the institute’s
Internet newsletter, with a shorter version in Southern Exposure magazine.
Contrast Gerth-tedium with Green’s pioneering and far richer treatment,
under the title "Halliburton:To the Victors Go the Markets."

December, the US Department of Defense made a no-cap, cost-plus-award contract
to Halliburton KBR’s Government Operations division. The Dallas-based company
is contracted to build forward operating bases to support troop deployments
for the next nine years wherever the President chooses to take the anti-terrorism
war… The Pentagon posts all contract announcements exceeding $5 million
on its Website, but in Halliburton’s case neglects to disclose the estimated
value of the award… Though the Pentagon may be wary of admitting its favor
towards Halliburton, the British Ministry of Defence shows no such reticence.
In the third week of December 2001, the Defence Ministry awarded Halliburton’s
subsidiary Brown & Root Services $418 million to supply large tank transporters,
capable of carrying tanks to the front lines at speeds of up to 50 miles per
hour… Because of Prime Minister Tony Blair’s invaluable service of persuading
Britain’s reluctant public to go along with the American campaign and in
providing British peacekeepers to secure Afghanistan, America’s junior
partner has been rewarded with a boost to its manufacturing base.

the major rewards are reserved for the Texas oil oligarchy.

Company has close connections with the Bush family. Aside from Cheney there
is Lawrence Eagleburger, a Halliburton director and former deputy secretary
of defense under Bush Sr. during the Gulf War. In its earlier incarnation as
Brown & Root Services, the company sponsored Texan and future president
Lyndon B. Johnson’s stolen election to the US Senate in 1948, building
the state’s spectacular political-industrial muscle."

how to write a story. But then both Green and the executive director of the
Institute, Chris Kromm, are former interns of mine. (But surely, you’ll
be asking, Gerth and his associate reminded Times readers of the colorful
saga of Brown & Root. No they didn’t.)

Even the
Gerth treatment may not save Cheney, who’s gone to ground again, just as
he did after 9/11, though this time the enemy will take the form of a subpoena-server
rather than the shock troops of Al Qaeda. What then? How can Bush freshen up
the White House’s battered image and his own terrible performance? Each
time he opens his mouth the markets take a dive and the dollar slumps against
the Euro. I thank Almighty God on a daily basis that my daughter elected to
get married in Geneva last year, when my dollars were able confront the bill
for the wedding feast in relatively good heart, with a side trip to Paris thrown

When Cheney
totters into that good night, may we not expect to hear the call for a hero
of NYC’s darkest hour, the former mayor, Mr. Rudy Giuliani, a man whose
marital upheavals have now been settled with a handsome payoff to the injured
wife and the charges of abominable cruelties sealed forever?

Vice President
Giuliani. How does that sound? I’ll tell you how it sounds to me. Terrifying.