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War Profiteers

 

"War is a Racket" is marine general, Smedley Butler's classic treatise on why wars are conducted, who profits from them, and who pays the price. Few people are as qualified as General Butler to advance the argument encapsulated in his book's sensational title. When "War is a Racket" was first published in 1935, Butler was the most decorated American soldier of his time. He had lead several successful military operations in the Caribbean and in Central America, as well as in Europe during the First World War. Despite his success and his heroic status, however, Butler came away from these experiences with a deeply troubled view of both the purpose and the results of warfare.

Butler's central thesis is that regardless of the popular rhetoric that often accompanies warfare, it is waged almost exclusively for profit. He advances this argument in three decisive examples.

EXAMPLE 1: CORPORATE MILITARY PROFITS RESULTING FORM WAR
In an early version of "follow the money", Butler provides pre- and post-World War I data on some of America's leading corporations to demonstrate the surge in profits that they experienced from the war, often totaling several hundred percent. While some companies, such as Dupont, arguably produced goods that contributed directly to America's military victory in 1918, others such as saddle manufacturers did not. Even when these companies failed to contribute directly to the war effort, they still managed to lobby the government to retrain or expand their contracts. Its as though powerful, well connected oil services company today were to contract with the government to supply oil to the military during a foreign campaign and then deliberately overcharge it.

EXAMPLE 2: INVESTING IN OTHER NATIONS' WARS
Butler argues that the United States practically doomed itself to entering the First World War the moment it began lending money and material to the allies. Once the allies were faced with certain defeat, argues Butler, they approached American government and business officials and flatly told them that unless they were victorious they would not be able to repay their staggering debt. In the event that Germany and the axis powers won the war, they would have no motivation to assume and repay the allied debt to the United States. America entered the First World War, according to Butler, in order to guarantee the repayment of its massive military loans to the allies. No allied victory meant no repayment, which meant no profit. Thousands of American soldiers were killed or maimed, argues Butler, to protect corporate profits.

EXAMPLE 3: THE MILITARY AS A COROPORATE THUG
Based on his own service experience in Central America and the Caribbean Butler argues that most American military interventions in small countries were done in order to "clear the way" for American corporations to set up shop and commence pillaging. It would be as if the United States were to occupy an oil-rich nation and then start doling out "rebuilding" contracts to some of its largest and best-connected corporations.

WHO PAYS FOR WAR
Having focused on who profits from war, Butler then examines who pays the price. The answer, unsurprisingly enough is the average taxpayer and the young people who are either slaughtered in wartime or who return home physically and psychologically damaged. Sadly, Butler points out, once these young people are no longer useful they are ignored by their own government and are left to suffer without assistance. It's as though a president were to employ a lot of rhetoric about supporting our troops while using them to occupy and oil-rich nation, but were to secretly slash their hazardous duty pay and veterans benefits.

THE SOLUTION: END WAR PROFITEERING
Butler's solution to preventing the carnage and social injustices of war is to eliminate business leaders' ability to make a profit from war or to avoid serving in it themselves. He also argues that those who put their lives at risk should have a say in whether or not to wage war. This may sound like a lot of idealistic, socialist nonsense, but think about it. Would the United States have invaded an oil-rich nation if its unelected president had been forced to serve in the front lines as part of the process? Would business interests have supported the war if they never stood to profit from it? Probably not.

"War is a Racket" also contains other interesting factoids including General Butler's successful prevention of a right-wing coup against President Franklin D. Roosevelt. Unfortunately, no one of General Butler's caliber was able to prevent a similar coup from taking place in 2000.

General Butler also makes a persuasive case for the United States to remain isolationist and to avoid involving itself in the coming European war (This book was published shortly before World War II.). Using his considerable grasp of military logistics, Butler counters many of the prevailing arguments of his day that Hitler posed a direct military threat to the United States. Unfortunately, no one of General Butler's caliber was available to counter a similar argument that right wing policy makers advanced about a tiny oil-rich nation in the Middle East posing a direct military threat to the United States.

To anyone who doubts the veracity or efficacy of this book, I have a humble but useful suggestion. Ask yourself who makes money off of war. Then ask yourself if they ever make the physical, mental, or fiscal sacrifices for war. Finally ask yourself who ultimately makes the sacrifices and pays the prices. Most people who favor war either profit from it, or are seduced by the idea of it. General Butler's book is a concise, and brilliantly argued treatise on the reality of war. Of course most people prefer a beautiful idea to harsh reality, and that is why propagandists and politicians are so successful.

Source: Book Review by Robert D. Steele (Oakton, VA United States)

 

Who is profiting from the Iraq War?

Richard Perle

 

Richard N. Perle

War Profits: Perle's Conniving

Published on Thursday, April 3, 2003 by The Charleston Gazette

Editorial

The most sensational war profits dispute forced Richard Perle to resign as chairman of a Pentagon board that sets war policies. Here’s the story:

Perle, who was assistant secretary of defense under President Reagan, is a militant “hawk” allied to the Bush family in Republican politics. Washington enemies call him “the Prince of Darkness.” In the late 1990s, while Democrat Bill Clinton still was president, Perle joined Cheney, Donald Rumsfeld, Paul Wolfowitz, William Kristol and other far-right figures in an outfit called the Project for the New American Century. PNAC issued a strategic plan calling for America’s awesome military superiority to be used to impose U.S. sway over the entire planet.

After Bush was awarded the presidency, most of the PNAC members got top administration posts. Rumsfeld became defense secretary. Wolfowitz became his deputy. Perle headed the Pentagon’s war policy board. Variously, they helped draft the “Bush Doctrine,” which says the White House may unleash a pre-emptive military attack on any nation it thinks might pose a future danger to America. Perle became a top advocate of war against Iraq.

The clamor to attack the Arab nation caused The Economist of London to observe that Perle, Wolfowitz and some other Bush military planners are Jewish, which raises suspicion that they might be “more concerned with protecting Israel than they are with advancing America’s national interest.” But the British journal said such fears are rooted in America’s former anti-Semitism.

Just as the Iraq war was launched, investigative reporter Seymour Hersh revealed in The New Yorker that Perle met in France with notorious Saudi arms dealer Adnan Khashoggi to discuss “the future of Iraq” and to invite another wealthy Saudi to invest in Perle’s national security firm, Trireme Partners. Khashoggi became famous in the 1980s because he helped Oliver North and other conspirators in the Reagan White House arrange illegal arms sales to Iran and use the profits to arm Contras who attacked Nicaraguans.

Meanwhile, it came to light that Global Crossing, the bankrupt telecommunications giant, hired Perle to overcome Pentagon objections to the firm’s takeover by Asian owners. Perle was paid a $125,000 fee, plus a promise of $600,000 more if he succeeded in changing the Pentagon’s view.

It was a brazen conflict of interest for a Bush insider holding a high Pentagon post to take money to influence Pentagon policy — especially since the money came from a sleaze-tainted firm. Newspapers around America raised a protest.

Also, Perle participated in a Goldman Sachs conference call advising investors how to reap war profits. The session was titled “Implications of an Imminent War: Iraq Now, North Korea Next?”

An Idaho Mountain Express columnist sneered: “Perle is a man who obviously believes in making hay while others fight the war he promoted.” Columnist Arianna Huffington commented on the Global Crossing deal:

“Perle’s windfall is coming from the coffers of a disgraced company that was among the worst of the corporate crooks. He’s lining his pockets at the expense of the 10,000 laid-off Global employees, who collectively saw $32 million in severance pay wiped out, and the shareholders, who lost $57 billion in equity when the company declared bankruptcy.”

Amid this uproar, Perle declared that he had done nothing wrong. He called Hersh “the closest thing American journalism has to a terrorist.” He threatened to sue Hersh. Finally, Perle was forced to step down as chairman of the Pentagon board — but he remains a member.

This sorry mess shows how some members of the boardroom elite who are entwined in Republican politics hope to profit from the tragedy of the Iraq war. It’s a disturbing picture.

 

Top Pentagon adviser resigns under fire

CNN
Friday, March 28, 2003 Posted: 7:34 AM EST (1234 GMT

WASHINGTON (CNN) -- One of the Pentagon's top civilian advisers resigned Thursday, saying he wanted to defuse a controversy over charges he stood to profit from the war in Iraq.

Richard Perle resigned as chairman of the Defense Policy Board, an independent group that advises Secretary of Defense Donald Rumsfeld.

Critics said Perle had a conflict of interest because he took a consulting job for the bankrupt telecommunications firm Global Crossing Ltd., which is trying to get the government to approve its purchase by a joint venture of two Asian firms.

The AP reported that according to lawyers and others involved in the bankruptcy case, Perle would receive $600,000 if the deal is approved, in addition to a $125,000 fee.

 

Perle Told Investors How They Could Profit From War

May 7, 2003

Pentagon adviser Richard Perle briefed an investment seminar on ways to profit from conflicts in Iraq and North Korea just weeks after he received a top-secret government briefing on the crises in the two countries.

Perle, who until March was chairman of the Defense Policy Board, a group of outside advisers to the Pentagon, also serves on the board of several defense contractors. His actions raise concerns about conflicts of interest.

Perle attended a Defense Intelligence Agency briefing in February and three weeks later participated in a Goldman Sachs conference call in which he advised investors in a talk titled Implications of an Imminent War: Iraq Now. North Korea Next?

A financial advisor who participated in the conference call told Capitol Hill Blue that Perle offered "advice on how to cash if war broke out in Iraq and/or North Korea."

Perle did not return phone calls or e-mails seeking comment.

One of Defense Secretary Donald Rumsfeld's closest advisers, Perle was a vocal advocate of going to war against Iraq and publicly questioned the reliability of some longtime U.S. allies, including France and Saudi Arabia.

Suing in England, Vacationing in France: the Misplaced Patriotism of Richard Perle

March 25, 2003

by Christopher Deliso

According to Richard Perle, there exists a "cozy relationship" between French president Jacques Chirac and Saddam Hussein. In fact, they're even friends. Of course, such silly accusations represent nothing new. In the Neocons' ongoing campaign against all things French, apparently not even the lowly French fry is safe.

Yet the riposte was rather surreal. After all, Washington's warmonger-in-chief does enjoy frolicking at his vacation chateau – in the balmy south of France.

This amusing discrepancy came to light in a recent investigation by veteran muckraker Seymour Hersh, in the New Yorker. Yet the French connection, while embarrassing enough, was merely symbolic in comparison to other conflicting involvements mentioned, regarding Richard Perle's financial and political motivations for demanding war on Iraq.

Hersh questioned whether Perle has abused his prominent position as chief of the Defense Policy Review Board, not only for financial gain, but also for advancing an unpopular war with Iraq at the behest of Israel.

In November 2001, says Hersh, Mr. Perle set up a company called Trireme Partners, to cater to the fast-growing "homeland security" market. His board members included other Defense Department advisors, as well as close associate Gerald Hillman and even Henry Kissinger. Shortly before bloviating against Chirac, Perle was (on 3 January) in Marseilles trying to shake down potential Saudi investors in Trireme, alleges Hersh. Apparently, Perle "peddled influence" in an attempt to win $100 million in investments for Trireme. The Saudis, who allegedly were hoping to trade the investment for a peaceful solution to Iraq, are well aware that Perle has expressed continuous and unrelenting hatred for their country, its government and its Wahabbist branch of Islam. That a US anti-Saudi campaign should be executed more, er, robustly has been a central theme for Perle and some of his appointed lackeys.

As Hersh recalls, Perle himself arranged for a Defense Policy Board briefing (on 10 July 2002) from a Rand Corporation analyst named Laurent Murawiec, who:

"…depicted Saudi Arabia as an enemy of the United States, and recommended that the Bush Administration give the Saudi government an ultimatum to stop backing terrorism or face seizure of its financial assets in the United States and its oil fields."

Although the government hurriedly moved to disavow this as not representing its official policy, Hersh believes that the Administration's failure to at least discipline Perle unnerved the Saudis. Although no Saudi investments have yet been made in Trireme, and the whole case is fraught with vigorous denials and counter-accusations, serious ethical questions about Mr. Perle have been raised.

The most troubling contention to emerge from the Hersh investigation is that Richard Perle may profit directly from the war on terror and the war on Iraq.

Perle, it seems, struck while the iron was hot, getting into the homeland security "game" soon after September 11th. Aided by mass paranoia, Perle and many others – from retailers of goods to crafters of Imperialist prose – were happy to help create what is likely to be the 21st century's most potent industry. Since 9/11, shameless opportunists have sprung up across the country and across the Internet, ready to take advantage of the American people's newfound spirit of impending doom. While such exploitation is reprehensible, we can assume that many of these snake-oil salesmen are just hapless, would-be entrepreneurs. Richard Perle, on the other hand, frequently brags about his great influence on the formulation of the White House's foreign affairs and homeland security policies. The bellicose rumblings of Perle and his Neocon peers have caused reverberations of panic around the country (especially whenever they shout about the unlikely "threat" of Iraqi terrorism), reverberations that must in the end sound, to Homeland Security purveyors, something like the ringing of cash registers.

The point here is that Perle and Co. can ratchet up the paranoia level at will, and frequently have done so – especially when it comes to elucidating threats to the real homeland.

However sick it may be to think that Richard Perle is deliberately trying to profit from spreading paranoia, the far worse thing is his allegiance to Israel. His personal profits, after all, do little direct damage to any of us. His primary political allegiances to a foreign country, however, do.

America is a melting pot for people of all colors and creeds. Our problem today is, as George Washington ominously predicted over 200 years ago, that some of them have principle loyalties to foreign causes or countries. Indeed, for every one of the world's regional conflicts, there are right now lobbyists and agitators hard at work on steering American foreign policy in wayward directions. One of the most dangerous (for Europeans, at least) is the Albanian-American lobby, enabled in part by the good Tom Lantos.

Yet right now, most foreign lobbies are relatively unimportant. In the overwhelmingly dominant context of Iraq, there is only one lobby that is threatening the security of the entire world – and that is Israel's lobby in Washington.

However, this lobby has a built-in self-defense mechanism, one that bigoted conspiracy theorists ruinously validate with their own paranoid musings. Nobody, excepting racists, sets out to criticize people on the basis of their religion. However, historically exploited sensitivities mean that in today's empathetic, politically correct United States of America, those who put the needs of the state of Israel first and foremost – whether they be Jewish or not – can instantly immolate any critic as a raving anti-Semite. Almost always, the benefit of the doubt is conceded to the former. However, in criticizing specific lobbyists for a specific foreign state, we have absolutely no interest in, and make no reference to, their religious orientation – but merely to the unneeded security dangers that their allegiance brings on the United States.

It is unquestionable that the Israel-first foreign policy advocated by Richard Perle and the Neocon chorus has hijacked the entire foreign policy of the Bush Administration. That it has not already exploded into their long-desired apocalyptic cultural showdown has a lot to do with the diplomatic concerns of Colin Powell, and the Cancerian caution of George Bush. However, far more powerful than these men are the Super-hawks such as Rumsfeld, Wolfowitz, Cheney and Perle. And their belligerence is firmly rooted in a devotion to the state of Israel and its apparent best interests.

An indispensable article by Dr. Stephen Sniegoski covers the details and ramifications of this entire issue. Among other things, it brings up the fact that Richard Perle has been putting Israel first for four decades:

"During the 1970s, Perle gained notice as a top aide to Senator Henry 'Scoop' Jackson (Democrat, Washington), who was one of the Senate's most anti-Communist and pro-Israeli members. During the 1980s, Perle served as deputy secretary of defense under Reagan, where his hardline anti-Soviet positions, especially his opposition to any form of arms control, earned him the moniker 'Prince of Darkness' from his enemies.

…Perle is not only an exponent of pro-Zionist views, but has had close connections with Israel, being a personal friend of Ariel Sharon's, a board member of the Jerusalem Post, and an ex-employee of the Israeli weapon manufacturer Soltam. According to author Seymour M. Hersh, while Perle was a congressional aide for Jackson, FBI wiretaps had picked up Perle providing classified information from the National Security Council to the Israeli embassy."

The last article came out in 1982. The next year, as Hersh reminds us now, Perle was the subject of a New York Times investigation regarding his recommendation that the Army buy weapons from a certain Israeli company that had paid him a $50,000 fee in 1981. And the list goes on.

There are two very clear indicators that Richard Perle – and the Neocons around him – have been planning for years to depose Saddam for the sake of Israel, whether or not he poses a threat or is involved with terror, and to hell with all other concerns. First of all was a Perle-endorsed 1996 policy paper called, "A clean break: a new strategy for securing the realm," which advised the incoming Netanyahu government to ignore the Oslo Peace Accords and take over the West Bank and Gaza. The stated greater goal was to overthrow Saddam, and presumably afterwards install pro-Western governments in countries such as Syria, Lebanon, Saudi Arabia and Iran. Second, in an open letter to President Clinton (19 February, 1998), Perle and Co. demanded the opportunity to "bring down" Saddam Hussein. The letter was signed by all of the usual suspects, including Robert Kagan, Bill Kristol and a more than up for it Donald Rumsfeld.

Although in 1998 Clinton deigned to comply, under the Bush Administration it seems the Israel-first militants have finally won. But at what cost? As the uncertainties of war once again grip the world, and the safety of its population remains unknown, it is necessary to realize going in that this is not America's war. When the reckoning comes – and it will – we should remember who brought it to us. Richard Perle and rest, perhaps, have ceased to be Americans. Their overweening hubris, their overseas allegiances are bound to bring ruin upon the already dying Republic.

But through all that gloom, at least there is a silver lining: we may purchase to our hearts' content, even from the safety of our own homes, Richard Perle's tastefully packaged and soon to be useful homeland security products.

It looks like Mr. Perle will have a bumpy ride in store for him, however, as new investigations are being made about various other jobs he has acquired through his chairmanship of the Defense Policy Board. The New York Times is looking into Perle's current advisory role to the bankrupt telecommunications company Global Crossing, in the process of being sold to Asian investors. Apparently, the influential Perle is being eyed as someone who can "…help overcome Defense Department resistance to its proposed sale." According to the Times, Perle:

"…is to be paid $725,000 by the company, including $600,000 if the government approves the sale of the company to a joint venture of Hutchison Whampoa, controlled by the Hong Kong billionaire Li Ka-shing, and Singapore Technologies Telemedia, a phone company controlled by the government of Singapore."

This very interesting piece, it should be noted, ends with a remarkable disclosure, one that implies some of our countrymen know more than us regarding where the dust will finally settle:

"Mr. Perle, who as chairman of the Defense Policy Board has been a leading advocate of the United States' invasion of Iraq, spoke on Wednesday in a conference call sponsored by Goldman Sachs, in which he advised participants on possible investment opportunities arising from the war. The conference's title was "Implications of an Imminent War: Iraq Now. North Korea Next?"

Christopher Deliso is a Balkan-based journalist, travel writer and critic of interventionist foreign policy. Over the past few years, Mr. Deliso's writing for Antiwar.com, UPI, various American newspapers, websites and European strategic analysis firms has taken him everywhere from the shores of the Adriatic to the top of the Caucasus Mountains. Mr Deliso holds a master's degree with distinction in Byzantine Studies from Oxford University, and also manages the Balkan-interest news and analysis website, Balkanalysis.com

 

Hollinger executives indicted for fraud

Federal prosecutors have indicted four Hollinger executives, including former chairman and CEO Conrad Black, on fraud charges related to the abuse of company perks and the $2.1 billion sale of several hundred Canadian newspapers.

The executives were also charged with illegally diverting $32 million from the company through a series of complex transactions and another $51.8 million in relation to the sale of CanWestGlobal Communications Corp.

"Officers and directors of publicly traded companies who steer shareholders' money into their pockets should not lie to the board of directors to get permission to do so," said U.S. Attorney Patrick Fitzgerald in a statement. He added that insiders "whose job it was to safeguard the shareholders made it their job to steal and conceal."

Hollinger's board of directors also came under heavy criticism in that report. In addition to Kissinger, the board had several other politically connected directors: Robert S. Strauss, a former chairman of the Democratic National Committee and ambassador to the Soviet Union; Richard R. Burt, a former United States ambassador to Germany; former Illinois Governor James Thompson (who chaired the company's audit committee, and was described by the report as "ineffective and careless") and Richard N. Perle, assistant secretary of defense under President Ronald Reagan the former chairman of a Pentagon advisory board. Perle was heavily scolded in the report, which says that Perle "repeatedly breached his fiduciary duties" a member of the board's executive committee.

According to the report, Perle signed papers that allowed Black and Radler to loot the company without even bothering to look at what he was signing. "It is difficult to imagine a more flagrant abdication of duty than a director rubber-stamping transactions that directly benefit a controlling shareholder without any thought, comprehension or analysis," the committee report says. "In fact, many of the consents that Perle signed as an executive committee member approved related-party transactions that unfairly benefited Black and Radler, and cost Hollinger millions."

Perle also ran an Internet investment arm of the company for Black, which, despite losing money, netted Perle $3.1 million in bonuses. A special board panel said that Perle should return $5.4 million in pay after "putting his own interests above those of Hollinger's shareholders."

 

An unsavory character on Bush team

THE SAN DIEGO UNION-TRIBUNE

September 13, 2004

Richard Perle, a foreign policy guru who has oozed his way through Republican administrations for two decades making a fortune as he went, has met his match in Conrad Black, the former head of Hollinger International, the U.S.-based newspaper conglomerate. Black stepped down as Hollinger CEO after being accused by shareholders of being a crook.

 

As Black goes down, Perle, who worked for the Bush administration and deserves as much credit for the Iraq war as anyone, is going with him. A special committee investigating Hollinger's financial losses accuses both men of corruption.

 

Perle is an important figure for he stands at the nexus of power and money. More than most, he has advocated policies that would make him money.

 

Perle, along with Henry Kissinger, serves on the Hollinger board of directors, as well as on the board of the Jerusalem Post, part of Black's newspaper empire.

 

 

 

 

 

Perle  is paid because of his working knowledge of Pentagon strategy.

 

 Payments for Perle

Federal laws place restrictions on the behavior of SGEs like Perle. Regulations Code 5 CFR 2635.702--barring the use of public office for private gain--also warns of the "appearance of government sanction," and cautions against using public standing "in a manner that could be reasonably construed to imply that his agency or the Government sanctions or endorses his personal activities." Section 5 CFR 2635.807 bans SGEs from receiving money for speaking on matters in which the SGE "has participated or is participating personally and substantially" for the government. "Experts have to make a livelihood," a government ethics specialist explained, "but they're prohibited...if there's a nexus between public and private."

Perle's high-profile articulation of Administration strategy blurs this line. Before the Iraq war, members of the Defense Policy Board acted as unofficial spokesmen for the Pentagon, with Perle charging networks while aggressively promoting the DOD stance. "It's misleading to be charging money [for] selling policy," says Bill Allison of the Center for Public Integrity. "It creates the problem of asking to profit off of your government connection."

Has Richard Perle Committed Treason?

March 31, 2003

By ANTHONY GANCARSKI


Article III, Section 3 of the US Constitution defines treason as giving aid and comfort, or "adhering" to our enemies. I believe "adhering" sums up Richard Perle's job description pretty well. The controversy surrounding Perle which occasioned his resignation from the Chair of the Defense Policy Board should not be quelled because he took that preemptive measure. Rather, it should force a deeper, public inquiry into what has motivated Perle to encourage the US to make aggressive foreign policy decisions inconsistent with both our overt national interest and historical precedent.

 

In a letter Perle wrote to Rumsfeld on Wednesday announcing his decision to resign the chairmanship, his language rang with the unctuous tones of a feigned self-flagellation for public consumption. "With our nation at war and American troops risking their lives to protect our freedom and liberate Iraq, I am dismayed that your valuable time, and that of others in the Department of Defense and the administration might be burdened by the controversy surrounding my chairmanship of the Defense Policy Board."

Controversy? What could be controversial about this scenario, neutrally described by UPI in the following manner.

 

"Perle, one of George W. Bush's foreign policy advisers during the 2000 presidential campaign, was hired last week by the bankrupt Global Crossing telecommunications company to help it restructure a deal to sell a majority holding in the company to Hutchison Telecommunications and government-run Singapore Technologies Telemedia. The United States government -- particularly the Defense Department and the FBI -- has national security concerns about the deal, according to The New York Times. It would put Global Crossing's fiber optics network -- which the military uses -- under Chinese ownership."

 

They are absolutely right to have "national security concerns" about the deal. How is it possible for the Pentagon to talk of "full-spectrum dominance" when moves are afoot to create a situation in which the US leases its military's fiber optics network from what will be our most formidable global competitor in the coming decades?

 

Richard Perle represents a threat to our National Security as tangible as that posed by Osama bin Laden or Saddam Hussein. His actions throughout his public life require a thorough Congressional investigation, centering on answering the question whether or not Richard Perle has committed treason, whether in the incident described above or in any of his other dealings for which ample documentation already exists.

 

Douglas Feith

 

Top War Profiteer Doug Feith Retires Wealthy 

By Evelyn Pringle

09/07/05 "ICH"
-- -- Douglas Feith, the recently resigned undersecretary of defense, who just happened to be one of the main people who for years on end advocated for a war in Iraq, and who in large part developed the disastrous policies for the war in Iraq, planned ahead for his retirement and will not be seen in the unemployment line. 

On January 27, 2005, the Washington Post announced: "A principal architect of the Defense Department's postwar strategy in Iraq ... will leave his post this summer." 

The announcement came after years of rumors that top administration officials had decided that Feith had to go, but were dissuaded by Donald Rumsfeld who argued that his ouster would be viewed as an admission that the war in Iraq was a mistake. But the administration had definitely reduced Feith's authority over the past 2 years. 

In announcing his departure, Feith claimed he was leaving for personal reasons, citing the desire to spend more time with his children. "For the last four years, they haven't seen me a lot," he told the Post. 

He used the standard administration exit line. Sort of like the noticeably absent in light of Katrina, ex-FEMA director, Joe Albaugh, who left his job to spend time with his family. Joe was Bush's chief of staff when he was governor of Texas and his campaign manager in 2000. Once Bush took office, Joe accepted a gig as director of FEMA. 

Like Feith, when he announced his resignation, Joe said, "Now I am going to take the opportunity to spend some time with my wife and children." 

I sure hope Doug spends more time with his kids than Joe did, because judging from hindsight, Joe should have been a psychic. He somehow knew at the beginning of March 2003, that he should quit FEMA and go into the business of securing reconstruction contracts in Iraq for wealthy clients before the first bomb was dropped. And his family could not have enjoyed much quality time at all with Joe, being he opened up New Bridge Strategies for business within a few short weeks of leaving the White House. 

At the time, Josh Marshall, who writes a column for the Washington newspaper, The Hill, said that he believed that each new piece of legislation needs a catchy title, and came up with title "The Bush Crony Full-Employment Act of 2003," for the $87 billion allocated for rebuilding Iraq. 

According to Josh, New Bridge was actually an outgrowth of Haley Barbour's lobbying firm, Barbour Griffith & Rogers. Josh says he reached that conclusion after he learned that both firms were located in the same office space. And also because Lanny Griffith was the CEO of New Bridge and Ed Rogers was the vice president. Sounds like a logical conclusion to me. 

When the company began, the New Bridges official web site said, "the opportunities evolving in Iraq today are of such an unprecedented nature and scope that no other existing firm has the necessary skills and experience to be effective both in Washington, D.C., and on the ground in Iraq." That phrasing was quickly changed. 

How could it get any sweeter than this? Joe quits FEMA, moves into the office space of one of the most successful and powerful GOP lobbying firms in the country and starts advertising for clients who want to win reconstruction contracts in Iraq. 

First Brother, Neil Bush, also jumped on this money train and landed a $60,000 a year consultant contract with a principal in New Bridge. According to Neil's testimony in his divorce deposition in March 2004, in return for his salary, he took phone messages for about 3 hours a week. 

However, 3 people contacted by the Financial Times of London reported seeing letters written by Neil that recommend business ventures promoted by New Bridges in the Middle East. So we had Neil being paid an annual fee to "help companies secure contracts in Iraq," the Times reported. 

I'm not too worried about Doug Feith ending up in the unemployment lines because following in Joe's footsteps, Feith and his law partner stayed very busy behind the scenes planning for Feith's retirement when it came time to leave the White House. 

The Iraqi International Law Group 

Before Feith was inducted into the Bush administration, he was the Feith half of the Feith & Zell, law firm in Washington. His partner, Marc Zell, simply renamed the firm, Zell, Goldberg & Co, when they decided to set up shop to start cashing in on the Iraq contracting business. 

According to The Hill, Zell, was helping with international marketing for a concern called the Iraqi International Law Group. Billing itself as a group of lawyers and businessmen interested in helping investors in Iraq, the venture was run by Ahmed Chalabi's nephew Salem, who doubled as a legal adviser to Iraq's governing council, of which his uncle was a member. 

How powerful was Feith in awarding contracts? Extremely. According to a June, 2004, by an article in Time Magazine entitled, "The Paper Trail: Did Cheney Okay a Deal? Feith is the person who approved the controversial no-bid contract for Halliburton in Iraq. 

Time Magazine quoted an email sent by Stephen Browning of the Army Corps of Engineers, that said the contract for construction of oil pipelines was approved by Under Secretary of Defense Douglas Feith "contingent on informing WH tomorrow. We anticipate no issues since action has been coordinated w VP,s [Vice President,s] office. 

Browning, later said in an interview that he wrote the memo after he and retired Lt Gen. Jay Garner met with Feith. According to Browning, Feith told him that he had already informed Cheney's office. The email was dated March 5, 2003, and Halliburton was awarded the contract three days later with no bids tendered by any other companies. 

If he could pull this off for Halliburton, what he could do for the IILG, goes without saying. According to its web site, the IILG was made up of lawyers and businessmen who claimed to have, "dared to take the lead in bringing private sector investment and experience" to the war-torn country and offered to "be your Professional Gateway to the New Iraq." 

The way it was set up, nephew Salem was charge of the IILG and Feith's partner, Zell, was in charge of international marketing. The IILG's website claimed that it was the only firm worth consulting. "At IILG, our task is to provide foreign enterprise with the information and tools it needs to enter the emerging Iraq and to succeed," it said. 

"Our clients number among the largest corporations and institutions on the planet" it said, "They have chosen IILG to provide them with real-time, on the ground intelligence they cannot get from inexperienced local firms or from overburdened coalition and local government officials." 

Imagine that, the top firms on the planet. 

"Many firms outside the country purport to counsel companies about doing business in Iraq," the web site read. "The simple fact is: you cannot adequately advise about Iraq unless you are here day in and day out, working closely with officials at the CPA, the newly constituted governing council and the few functioning civilian ministries [oil, labor and social welfare, etc]." 

The truth is, the IILG was nothing more than another one of many front companies, in a web-like profiteering network, that was specifically set up to funnel tax dollars through Iraq and back into the pockets of the Bush gang. 

And talk about blatant. When the company was set up, its website was not registered to Salem Chalabi; it was registered under the name of Marc Zell, located at the very same address as Zell, Goldberg & Co. 

According to Salem, quoted in the National Journal, Zell was IILG's "marketing consultant" and had been contacting law firms in Washington and New York to ask if they had clients interested in doing business in Iraq. 

This tied in with an announcement by Zell, Goldberg & Co, that it had set up a "task force" dealing with issues and opportunities relating to the "recently ended" war in Iraq, and to assist companies "in their relations with the United States government in connection with Iraqi reconstruction projects as prime contractors and consultants." 

Of course Zell made no mention of the firm's ties to the infamous nephew Salem or the IILG. Zell said it was working with the Federal Market Group, an organization which specialized in helping companies win government contracts, which boasted of having a 
90% success rate. 

Considering all of its boasting about high level connections, IILG was also rather modest about the family ties of its founder. The website did not mention that he was the nephew of Ahmed Chalabi even once. Geez, I wonder why. 

Implementing The Iraq Profiteering Scheme 

Feith had been pushing for the ouster of Saddam for years. In 1998, him and Richard Perle sent a letter to President Bill Clinton proposing that the US team up with Ahmed Chalabi's Iraqi National Congress to get rid of Saddam. Clinton refused. 

As we all know, Ahmed had strong support within the Pentagon. In fact, two of his staunchest supporters were Feith, and Perle, chairman of the Defense Policy Board. 

Perle, an assistant defense secretary during the Reagan administration, was appointed by his old crony, Donald Rumsfeld, to lead the board in 2001. Its a well-known fact that the board exerts tremendous influence when it comes to war policies. 

As soon as Bush took office, Perle, Feith and Ahmed Chalabi all started working diligently together to get the war in Iraq off the ground, with Ahmed providing bogus intelligence about WMDs and bragging about a secret network within Iraq which could take over running the country after the invasion. 

"There was a close personal bond, too, between Chalabi and Wolfowitz and Perle, dating back many years," according to Seymour Hersh in the May 5, 2003 the New Yorker. 

"Their relationship deepened after the Bush Administration took office, and Chalabi's ties extended to others in the Administration, including Rumsfeld; Douglas Feith, the Under-Secretary of Defense for Policy; and I. Lewis Libby, Vice-President Dick Cheney's chief of staff," Hersh wrote. 

"With the Pentagon's support, Chalabi's group worked to put defectors with compelling stories in touch with reporters in the United States and Europe," Hersh said, "The resulting articles had dramatic accounts of advances in weapons of mass destruction or told of ties to terrorist groups. In some cases, these stories were disputed in analyses by the C.I.A." he noted. 

Almost immediately after September 11th, "the I.N.C. began to publicize the stories of defectors who claimed that they had information connecting Iraq to the attacks, Hersh said. 

For example, in a October 14, 2001, interview on PBS "Frontline," Sabah Khodada, an Iraqi Army captain, said that the 9/11 attack "was conducted by people who were trained by Saddam," and that Iraq had a program to instruct terrorists in the art of hijacking. Another defector, who was identified as a retired lieutenant general in the Iraqi intelligence service, said that in 2000 he witnessed Arab students being given lessons in hijacking on a Boeing 707 parked at an Iraqi training camp near the town of Salman Pak, south of Baghdad. 

Feith then fed this type of INC data into a fabrication mill operating at top speed known as the Office of Special Plans and some of the information processed through the OSP was not even shared with official intelligence agencies. In many instances it was passed on to the National Security Council, Cheney, and Bush without having been vetted by anyone besides this group of nitwits. 

And they had to know that much of the information was false. A former high-level intelligence official told Hersh that American Special Forces units had been sent into Iraq in mid-March 2003, before the start of the war, to investigate sites suspected of being missile or chemical- and biological-weapon storage depots. "They came up with nothing," the official told Hersh. "Never found a single Scud." 

A 46 page report, based on a 15-month investigation, titled, Report of an Inquiry into the Alternative Analysis of the Issue of an Iraq-al Qaeda Relationship, was released on October 21, 2004, which said, "There is ample evidence that the Bush Administration had a predisposition to overthrow Saddam Hussein before the 9/11 attacks." 

The report accused Feith's office of compiling "selective reinterpretations of intelligence" that went beyond the views of American spy agencies in order to help make the case for an invasion of Iraq. 

The report concluded that Feith and his staff were convinced that a relationship existed between Saddam and Al Qaeda, and that the office had advanced that perspective by trying to change the intelligence community's views and "by taking its interpretation straight to policymakers." 

"That alleged relationship," the report said, "coupled with the assertion that Iraq possessed stockpiles of weapons of mass destruction (WMD), was the major argument presented by the Administration for invading Iraq." 

Relying on selective reporting, irrespective of credibility and reliability, Feith's briefing concluded the following: 

. Iraq had "more than a decade of numerous contacts" with al Qaeda; 

. there were "multiple areas of cooperation" between Iraq and al Qaeda; 

. Iraq and al Qaeda had a "shared interest and pursuit of WMD;" and 

. there was "[o]ne indication of Iraq coordination with al Qaeda specifically related to 9/11," presumably a reference to the alleged (but doubted by the IC) Atta meeting in Prague. 

The report states that there are no known intelligence reports, other than those provided by Feith's office, that could explain where this view originated. "A pattern emerges of senior administration officials exaggerating the extent of the relationship in public statements which more closely reflect the Feith analysis" than those of the intelligence community, it said. 

As an obvious example, the report said Feith's office repeatedly asserted in the months leading up to the war that lead hijacker Mohammed Atta had met with an Iraqi intelligence agent in Prague in the spring before the September 11 attacks, an account that the CIA dismissed because evidence existed that Atta was elsewhere at the time. 

And in at least one case, according to the report, the Pentagon office included the purported meeting in a report sent to the White House, but omitted it from the version of the same report sent to the CIA. 

The meeting was then constantly referred to by senior administration officials, and especially Cheney, as evidence of a possible Saddam link to 9/11. In fact, Cheney said the Feith analysis was the "best source of information," according to the report. 

However, not only had the alleged meeting never been "known," at the time of the briefing to the White House, the Intelligence Community was skeptical in late spring 2002 that such a meeting ever took place. Yet in September of 2002, Feith called the meeting a "known contact" in a crucial misstatement about the intelligence, since it indicated a link which did not exist. 

"The professional objectivity and independence required in the assessment of the Iraq-Al Qaeda relationship, a major reason given for going to war, were compromised to support a predetermined policy -- to present the government of Saddam Hussein as a serious threat to the security of the United States" the report wrote. 

Finally, relative to the attacks, the final 911 Commission Report itself said that the "Intelligence Community has no credible information that Baghdad had foreknowledge of the 11 September attacks or any other al-Qaida strike." 

Inventing bogus intelligence was bad enough but during the pre-war planning, the military experts were systematically excluded from participating in that process as well. In the end, Feith and the OSP had so grossly underestimated the Iraqi resistance that it caused General Tommy Franks, who led the invasion in Iraq, to call Feith "the fucking stupidest guy on the face of the earth," according Bob Woodward's book Plan of Attack. 

Feith and the Defense Policy Board 

The DPB is a group of 30 people, who for the most part were chosen by Rumsfeld and Feith, that advises officials on whether to go to war or not. Many of its members are literally making a fortune off a war which they had been promoting for years. At least 9 members have ties to companies that won more than $76 billion in defense contracts during 2001 and 2002. 

Feith excluded many top Middle East experts from the State Department from playing any meaningful role in the Coalition Provisional Authority (CPA). Feith's office and the CPA were tasked with awarding reconstruction contracts in Iraq. 

So this was another sweet setup. Feith was deciding who would get contracts, at the same time that his middleman law partner, Zel, was hustling up business deals in Iraq for rich clients. Of course, for members of the Bush war profiteering club, this was merely business as usual. 

Among the firms that have profited the most, are those with consultants serving on the DPB, many of which were hand-picked by Feith. 

Some of the construction and defense companies with direct ties to DPB members include Boeing, Bectel, TRW, Northrop Grumman, Lockheed Martin and Booz Allen Hamilton, along with smaller players like Symantec Corp, Technology Strategies and Alliance Corp, and Polycom Inc. 

How much money was up for grabs when it came to doling out defense contracts? For starters, during the major combat phase of the war, the US military launched over 
800 Tomahawk cruise missiles at Iraqi forces, according to figures released by the US Navy. 

At a price of about $569,000 each, replacing those missiles no doubt generated a lofty amount for Raytheon Systems, the Pentagon contractor for Tomahawks. Close to a 100 more missiles were fired during Operation Enduring Freedom in Afghanistan. 

Occupation forces later launched over 19,000 guided munitions in Iraq, most of which came from the US, according to a report on Operation Iraqi Freedom published by the US Central Command Air Forces on 30 April 2003. 

There was a $10.3 billion proposal for the development of a missile defense program in Bush's 2005 defense spending budget, of which Lockheed Martin would be heavily involved in, according to a report from the World Policy Institute. 

Northrop Grumman, the country's third largest defense contractor, secured contracts to build new weapons systems such as the unmanned predator drones. The firm is the prime contractor for the Global Hawk Unmanned Aerial Vehicle (UAV). Bush proposed $12 billion for UAV development for the years between 2004 - 2009. Northrop earned a company record of $11.1 billion in defense contracts in 2003. 

And Bush is funneling our tax dollars to known crooks. Northrop's Vinnell subsidiary was awarded a $48 million contract to train the new Iraqi Army, even though Northrop was forced to pay $191.7 million in penalties over the previous 4 years. 

In less than a year after he took office, Bush got rid of regulations implemented by President Clinton that barred contracts for companies convicted or penalized for crimes during the previous 3 years. Clinton strengthened the rules before leaving office, and said that repeated violations would make a company ineligible for new contracts. Bush suspended the regulations within his first 3 months in office. By December 2001, he had revoked them entirely. 

In the end, I don't think its likely that Feith will end up in the welfare lines. Due to careful post-White House planning, I think its safe to say that Feith and his band of cronies will enjoy financial benefits for life, just so long as their never-ending war policies are carried on by their successor. 

Evelyn Pringle epringle05@yahoo.com 

Evelyn Pringle is a columnist for Independent Media TV and an investigative journalist focused on exposing corruption in government

 

 

Iraq Construction Fraud

 

 

Robert J. Stein Jr.,

Philip Bloom

 

Occupation official accused of Iraqi kickback scheme

 

WASHINGTON (AP) — A former U.S. occupation official in Iraq bought real estate, cars,      jewelry and home improvements with the kickbacks he received from a businessman who won more than $13 million in reconstruction work, federal authorities say.

 

Robert J. Stein Jr., 50, of Fayetteville, N.C., and his wife, even used the money pay federal taxes and restitution for Stein's earlier federal fraud conviction, an affidavit made public Thursday said.

Stein faces conspiracy, money laundering, wire fraud and other charges stemming from his alleged role in helping Philip Bloom, a U.S. citizen who has lived in Romania for many years, get the Iraqi contracts, federal authorities said Thursday.

 

More than $630,000 flowed to Stein and others from accounts Bloom controls in banks in Switzerland, the Netherlands and Kuwait, prosecutors said. Bloom, 65, has been charged with conspiracy and money laundering stemming from an investigation that Justice Department officials say could result in additional charges against others.

 

 

Suspect in Iraq graft is no stranger to fraud

 

By James Glanz The New York Times

FRIDAY, NOVEMBER 18, 2005

 

NEW YORK A North Carolina man who has been charged with accepting kickbacks and bribes was hired as a controller and financial officer for the American occupation authority in Iraq despite having served prison time for felony fraud in the 1990s.

The job gave the man, Robert Stein, control over $82 million in cash earmarked for Iraqi rebuilding projects.

Along with a web of other conspirators who have not yet been identified, Stein and his wife received "bribes, kickbacks and gratuities amounting to at least $200,000 per month" to steer lucrative construction contracts to companies run by another American, Philip Bloom, an affidavit outlining the criminal complaint says. Stein's wife, whose name was not given, has not been charged with wrongdoing in the case; Bloom was charged on Wednesday with a range of crimes.

The affidavit, filed in U.S. District Court in the District of Columbia, said Stein, 50, was charged with wire fraud, conspiracy, interstate transportation of stolen property and conspiracy to commit money laundering.

But the list of charges does little justice to the astonishing brazenness of the accusations described in the complaint, including a wire transfer of a $140,000 bribe, arranged by Bloom, to buy real estate for Stein in North Carolina. The affidavit also says that $65,762.63 was spent to buy cars for Stein and his wife (he bought a Chevrolet; she a Toyota), $44,471 for home improvements and $48,073 for jewelry out of $258,000 sent directly to the Bragg Mutual Federal Credit Union into accounts controlled by the Steins.

Stein's wife even used $7,151.58 of the money for a "towing service," the complaint says. Much of this money was intended for Iraqi construction projects like building a new police academy in the ancient city of Babylon and rehabilitating the library in Karbala, the southern city that is among the holiest sites for Shiite Muslims.

After Stein awarded contracts for this work to Bloom, the work often was not performed or was done shoddily, the prosecutors allege. Bloom eventually received at least $3.5 million himself, according to the complaint.

Stein was arrested in North Carolina on Monday, the Justice Department said in a statement. He appeared in court on Tuesday, represented by Jane Pearce, an assistant federal public defender in North Carolina's Eastern District, said Elizabeth Luck, a spokeswoman for the office. Luck said the office would not comment on the case.

Little is known about Stein except that he served in the army and was convicted in federal court in 1996 for "access device fraud," a felony. Court papers show that he was sentenced to eight months in prison and ordered to pay $45,339.25 in restitution.

Stein worked for Grundy Marine Construction, based in Ponte Vedra Beach, Florida, in 2001 and 2002, said the company's vice president, Pete Caruk, by telephone. Stein was fired when he was found to be falsifying payroll records and making out false invoices for nonexistent purchases of materials for a construction job at an air force base, Caruk said.

U.S. official pleads guilty to kickback scheme

 

April 19, 2006

Associated Press

 

WASHINGTON — A former U.S. contracting official in Iraq admitted he conspired to steal more than $2 million in reconstruction money and to award contracts to a businessman in exchange for more than $1 million in cars, jewelry and cash.

 

Robert J. Stein Jr., 50, of Fayetteville, N.C., was expected to enter his guilty plea in U.S. District Court in Washington today. His would be the first conviction in a federal investigation that has implicated at least seven people.

 

Stein, a former contracting official for the Coalition Provisional Authority in Iraq, acknowledged his role in the conspiracy in a signed statement filed with the court.

 

The businessman, Philip H. Bloom, also faces federal conspiracy and money laundering charges. Bloom is not named in Stein’s statement, but has been identified elsewhere by prosecutors and is in federal custody in Washington.

 

Five U.S. Army Reserve officers who worked in Iraq also were part of the conspiracy, according to court papers.

Rita Bosworth, a Federal Public Defender in Washington who is representing Stein, had no comment Wednesday. John Nassikas, Bloom’s lawyer, declined to comment.

 

Stein, who has an earlier federal fraud conviction, used the money — stolen or paid by Bloom — to buy a single-engine Cessna airplane, a top-of-the-line Porsche and other cars, grenade launchers, machine guns, diamond rings and other jewelry, and property in North Carolina, he said in his signed statement.

 

Stein said he helped steer more than $8.6 million in contracts to companies controlled by Bloom, a U.S. citizen who has lived in Romania for many years. The contracts were for less than $500,000 each, the limit of Stein’s authority as the top contracting official in Hillah, 50 miles south of Baghdad.

 

Projects won by Bloom’s companies included a new police academy for Hillah and renovation of the public library in nearby Karbala. Bloom’s Romanian-based companies are Global Business Group, GBG Holdings and GBG-Logistics Division, prosecutors have said.

 

The statement includes frank e-mails between Stein and Bloom about payments and phony bids for contracts. “I love to give you money,” Stein wrote after approving a $200,000 contract for the police academy in January 2004.

 

In another exchange, Stein apologizes for being “businesslike” and cautions Bloom to avoid using the same company name on all contract bids, which could arouse suspicion. Bloom agrees, adding, “Since we are paid in cash it really doesn’t matter tax wise.”

 

Bloom supplied Stein and others with “business class and first class plane tickets, watches and other jewelry, alcohol, cigars, sexual favors from women ... at his villa in Baghdad, and money laundering services,” for the stolen reconstruction funds, the statement said.

 

The U.S.-controlled CPA ran Iraq from shortly after the March 2003 invasion until June 2004. It had final say over spending from the Development Fund for Iraq, made up mainly of Iraqi oil revenues.

 

The case against Stein has its roots in audits performed by Inspector General Stuart W. Bowen Jr., who is looking into Iraqi reconstruction contracts.

 

If Bloom and Stein will be tried and convicted why hasn’t Perle also faced the same scrutiny and charged with similar crimes of profiteering in violation of Code 5 CFR 2635.702?

 

 

WOOLSEY'S WEB: STRUCTURAL CORRUPTION & IRAQ

 

WALTER F. ROCHE JR. HAS AN ILLUMINATING PIECE TODAY in the Los Angeles Times on the clan Woolsey -- exposing some of the Iraq contract connections of Suzanne Woolsey, the former CIA Director's wife. In January 2004, she became a director of Fluor Corporation, which has $1.6 billion in Iraq related contracts. She also serves as a director of the Institute for Defense Analyses which also has war interests, and received modest compensation for that role according to the article.

 

James Woolsey serves as Vice President of Booz Allen Hamilton with at least $89 million in Iraq defense contract interests. Roche's article also points out that Suzanne Woolsey is also affiliated with Paladin Capital Group, a venture capital firm where her husband serves as a principal and director.

 

A reader of The Washington Note entry on Woolsey tipped me off to James Woolsey's Paladin connection last week -- and I was somewhat stunned by the brazen language of the "Paladin Homeland Security Fund" that Woolsey helps direct. I realize that many intelligence and military officials make natural fits for defense related firms when they leave public service -- but I think that big, inappropriate lines get crossed when individuals help fan wars, in which people die, and financially benefit from the result. A recusal from war profits should be standard for talking heads and policy commentators when it comes to sending American men and women into harm's way.