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US: Halliburton Lobby Costs Drop

by Maud S. BeelmanBoston Globe
March 27th, 2004

WASHINGTON - Halliburton, the oil and construction conglomerate formerly headed by Vice President Dick Cheney, dramatically reduced what it spent on lobbying Congress and the federal government after the Bush-Cheney administration took office in January 2001.

During the last two years of the Clinton administration, Halliburton reported spending $1.2 million lobbying the Senate, House of Representatives, and various executive branch departments, according to records reviewed by the Globe. In comparison, during the first two years of the Bush administration, Halliburton reported spending just $600,000.

Despite the dropoff in lobbying, the value of Halliburton's work began to increase in the run-up to the Iraq War, and eventually came to be worth more than $8 billion for overseeing aspects of the Iraqi reconstruction. Its federal contracts never exceeded $1 billion per year under the Clinton administration.

A Halliburton spokeswoman said the cuts in lobbying funds reflected a decision to rely more on industrywide lobbyists than individuals representing the company's particular interests.

But James Thurber, an American University professor who studies interest groups and lobbying, was skeptical of that explanation.

"They're already in; they don't need to lobby any more," Thurber said of Halliburton.

The flood of business to Halliburton for the Iraq reconstruction, coupled with allegations that it overcharged the government on some aspects of its contracts, has led some Democrats to contend the company may be benefiting from its association with the Bush administration.

Cheney has denied playing any role in giving Halliburton contracts or expanding existing contracts. And last month, Halliburton launched a media campaign to counter suggestions that it had benefited from its association with Cheney, whose blind trust continues to receive payments from the company. The vice president has said he insured the payments so they would neither rise nor fall depending on changes in the company's business.

"We're serving the troops because of what we know, not who we know," Dave Lesar, who succeeded Cheney as Halliburton's president and CEO, says in one television ad broadcast in Washington.

Halliburton's lobbying activities are spelled out in documents submitted under the Lobbying Disclosure Act of 1995, which mandates that those who lobby Congress or the executive branch file twice-yearly reports on their activities. The latest report shows Halliburton spending $150,000 for the first six months of 2003. Reports for the second half of 2003 are not yet public.

"In recent years, we have joined others in their efforts as a team approach versus an individual company effort," Wendy Hall, Halliburton's director of public relations, wrote in an e-mail when asked about the decline. "We are doing business in a completely different environment; issues have changed, budgets have changed, and the economy has changed."

Under the Clinton administration, Halliburton's business grew but never exceeded $839 million per year, according to the nonpartisan Center for Public Integrity.

The Army Corps of Engineers has told members of Congress that Halliburton was awarded the Iraq contracts because it had won a competitively bid contract in December 2001 to support the military's operations abroad, beating out the previous contract holder, DynCorps, as well as Raytheon.

That put it in a position to receive a no-bid classified order to design a contingency plan to deal with oil well fires in the event of a war in Iraq in the fall of 2002. After the invasion, the Corps greatly expanded Halliburton's contract without competitive bidding because, the Corps has said, the company was the only one in a position to implement the plan on time because it designed the plan.

But critics have insisted that more of the billions of dollars in work being given to Halliburton should have been put out to competitive bid, and that the Bush administration should have done more to assure that the company was not amassing unreasonable profits.

Companies employ lobbyists - often firms of lawyers or former government officials with strong political ties - to ensure their views are heard and their interests are cared for on Capitol Hill, at the White House, and throughout the federal government. Halliburton's chief lobbyist, for example, is Charles Dominy, a retired general with the Army Corps of Engineers, which oversees its contracts in Iraq.

Lobbying and employing former government officials are not the only source of influence in Washington. Campaign contributions offer a third corridor of access.

In the last presidential election, Halliburton, its subsidiaries, and employees contributed $536,765 to federal candidates, party committees, and leadership PACs, or political action committees, according to the Center for Responsive Politics. Ninety-seven percent of that, or $521,715, went to Republicans.

The same trend was clear in the 1996 election cycle, when 96 percent of Halliburton's $448,563 in political contributions went to Republicans. So far in this latest presidential election cycle, 88 percent of Halliburton's giving has gone to Republicans, according to the agency.

The lobbying reports offer the only quantifiable measure of a company's lobbying activities, but the Rev. Edward B. Arroyo, co-author of "The Ethics of Lobbying: Organized Interests, Political Power, and the Common Good," cautions against assuming a causal relationship between Halliburton's decreased spending on lobbying and Cheney's presence in the Bush administration.

"There's obviously a correlation, a very crude correlation, about which party was in power in 1999-2000 and which party was in power in 2001, and, of course, the vice president was head of Halliburton," Arroyo said by phone from New Orleans, where he directs an ethics in public policy program at Loyola University in collaboration with Georgetown University. "But it's the deception of a correlation."

"There's just a lot more types of lobbying that you don't have to register," including public relations strategies and grass-roots campaigns, he added. "Halliburton may be doing all kinds of lobbying that we can't get a handle on."




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