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US: Senate Committee Silence on Halliburton Bemoaned

Called "spineless," the Senate Homeland Security and Governmental Affairs Committee has held no hearings on whether civilian contractors in Iraq — particularly Halliburton, the company Vice President Cheney used to head — have mismanaged and overcharged the government by billions of dollars, much to the consternation of Senate Democrats.

by Emily PierceRoll Call
May 23rd, 2005

The Senate Homeland Security and Governmental Affairs Committee has held no hearings on whether civilian contractors in Iraq — particularly Halliburton, the company Vice President Cheney used to head — have mismanaged and overcharged the government by billions of dollars, much to the consternation of Senate Democrats.

Chairwoman Susan Collins (R-Maine) has steadfastly refused to hold hearings on the issue in the more than two years since the start of the war in Iraq, despite — Collins says because of — multiple executive branch investigations of Halliburton subsidiary Kellogg, Brown and Root.

“We should not be in our committee spineless,” Sen. Frank Lautenberg (D-N.J.) said in a recent interview. “We should go ahead and investigate this.”

Since May 9, 2003, Lautenberg, a junior member of the panel, has sent five letters to Collins requesting hearings on various alleged misdeeds of KBR and Halliburton.

In his most recent letter on April 26, Lautenberg outlined several issues the committee could probe, including:

• An April 2005 State Department report that found major cost overruns and “poor performance” by Halliburton on a $1.2 billion contract to repair Iraqi oil fields.

• The Defense Department’s decision to override its own auditors when it decided in February not to withhold payments from Halliburton until questions about overcharges were answered.

• Allegations by an Army Corps of Engineers whistleblower that Halliburton was unfairly and improperly awarded its no-bid contract with the U.S. government.

• Findings by Pentagon auditors that Halliburton overcharged the government $61 million for gasoline imports in Iraq as well as $27.4 million for troops’ meals in Iraq.

• Allegations that Halliburton employees received $6.3 million in kickbacks from Kuwaiti businessmen in exchange for subcontracting deals.

• Allegations that KBR employees abandoned trucks, each costing $85,000, due to flat tires and other repairable problems.

• Revelations by the former Coalition Provisional Authority’s inspector general that KBR lost track of more than $18 million in equipment.

On numerous occasions, Collins has said she shares Lautenberg’s concerns about the fact that the original Halliburton contract — now estimated to be worth more than $10 billion — was awarded outside of the normal competitive-bidding process.

However, she continues to assert that she does not want to duplicate the work of other agencies by holding hearings.

“The committee’s ambitious agenda, which includes an in-depth assessment of the security of U.S. chemical facilities — ironically, a top priority of Sen. Lautenberg’s — does not leave room for duplicative work unlikely to yield substantial benefits,” said Elissa Davidson, a Collins spokeswoman.

Collins said much of the same in a Feb. 11, 2004, letter to Lautenberg, writing: “In the case of Halliburton, the General Accounting Office, Defense Criminal Investigative Service (DCIS) and the Defense Contract Audit Agency are looking into matters that include the company’s work in Iraq. Moreover, the DCIS investigation, which is criminal in nature, could spur additional agency review of Halliburton’s work. You, of course, can understand that, in setting the Committee’s hearing agenda, I do not wish to overlap or duplicate the work already being conducted by the appropriate authorities.”

However, on the other side of the Capitol, the House Government Reform Committee has held four hearings on Iraqi contract abuses at the same time those agencies and the Justice Department were investigating Halliburton and KBR.

At the last hearing the House committee held on July 22, 2004, multiple panels of KBR employees testified about abandoned trucks and other questionable decisions by company managers in Iraq that may have cost the government more money than necessary.

Indeed, Government Reform Chairman Tom Davis (R-Va.) held the hearings partly to defuse Democrats’ ability to use the issue to attack Cheney.

“There needed to be a lot more light than heat on this,” Davis spokesman Robert White said. “With contracting, it’s easily misconstrued what’s happening in Iraq.” White added that Davis wanted “to find out what the facts were before making any judgments.”

White did not speak directly to whether Collins should hold similar hearings, but he noted that Senate Democrats eager for answers on Iraqi contracting abuses need look no further than the work the House has done.

“If Senate Democrats want copies of our hearings, we’ll be more than happy to provide transcripts,” he said.

White acknowledged that holding the hearings did come with some political peril for Davis.

“I don’t think the administration was always thrilled that we were bringing the subject up, but we’re the oversight committee,” he said.

Though generally frustrated about what he sees as the lack of Congressional oversight of the Bush administration, Rep. Henry Waxman (D-Calif.), the ranking member on the House Government Reform panel, praised Davis for holding such hearings.

“The chairman has done more than anybody else on official hearings on either side” of the Capitol, Waxman said.

Waxman, along with Lautenberg, rejected Collins’ assertion that Congress should not duplicate other agencies’ work.

“Duplication of what? The administration? Well, we’re a separate branch of government,” Waxman said.

Lautenberg agreed.

“To suggest that it’s duplicative is really almost comical,” he said. “There’s all kinds of duplication around here. ... It’s not at all unusual especially with our committee.”

Senate Democratic Policy Committee Chairman Byron Dorgan (N.D.) noted that one of the chief purposes of Congress is to be a check on the executive branch’s activities, regardless of whether it has already launched internal investigations.

“One of the most important historical roles of the United States Congress is to provide oversight,” Dorgan said, noting that then-Sen. Harry Truman (D-Mo.) investigated allegations of war profiteering during World War II even though the president, Franklin Delano Roosevelt, was also a Democrat.

“The minute you mention Halliburton everybody thinks you want to investigate Vice President Cheney,” Dorgan said. “But, no, we’re investigating waste, fraud and abuse.”

Indeed, the lack of Senate hearings on the matter is part of what prompted Dorgan last year to begin holding informal hearings with Members of Senate Democratic Policy Committee.

Since November 2003, Dorgan has held four hearings on contracting abuses in which “witnesses have testified that the Bush administration failed to follow long-established procedures for awarding these contracts, mismanaged the performance of the contracts, and allowed government contractors to engage in fraudulent and wasteful activities,” according to Dorgan spokesman Barry Piatt. The most recent of these unofficial hearings was held on Feb. 14, 2005.

But Davidson noted that Collins and her committee staff have been privately keeping track of the alleged mismanagement of Iraqi reconstruction and Defense Department contracts since the beginning of the war.

“The Committee on Homeland Security and Governmental Affairs is overseeing numerous ongoing executive branch investigations and audits focused on the many contracts for Iraq reconstruction,” Davidson said, noting that ongoing investigations are also being conducted by the Unites States Army Audit Agency, the Defense Department Inspector General, and the Special Inspector General for Iraq Reconstruction.

In fact, Collins will be meeting in the next month or so with the Special Inspector General for Iraq Reconstruction, Davidson said.

Meanwhile, Davidson said that many of Lautenberg’s complaints, particularly about the way in which Halliburton’s no-bid contract was awarded, “have failed to be substantiated. For instance, the GAO noted that the initial award to Halliburton ‘complied with applicable legal standards.’ Former Clinton Procurement Policy chief, Harvard Professor Steve Kelman wrote in The Washington Post [on Nov. 6, 2003] that the allegations of cronyism in Iraq contracting were ‘implausible’ and that ‘the whiff of scandal manufactured around contracting in Iraq obviously has been part of the political battle against the administration’s policies.’”

Still, part of Lautenberg’s inability to get a hearing in the Homeland Security and Governmental Affairs Committee may stem from the fact that ranking member Joe Lieberman (D-Conn.) has not asked for a hearing on the issue since he signed on to a Lautenberg letter on Sept. 23, 2003.

Indeed, Lieberman suggested recently that he did not want to strain his already “great working relationship” with Collins by pressing her to hold hearings that could potentially anger the Bush administration.

“I believe in the oversight role of this committee, but I’m going to avoid giving you a more explicit answer because I work very closely with the chairman,” Lieberman said.

Lieberman also seemed to agree with Collins’ rationale that to hold hearings on Halliburton would be duplicative.

“There have obviously been some independent investigations, so I guess the question is whether there is something to be gained. In other words, we don’t want to do it just to do it if it’s repetitive,” Lieberman said.

Despite Lieberman’s reticence, Lautenberg said it’s not unusual for Republican committee chairmen to hold hearings at a Democratic Member’s request.

“Usually, there’s an accommodation,” Lautenberg said. “You don’t get to pick all the witnesses you want, however.”

Meanwhile, as head of the Homeland Security and Governmental Affairs panel, Collins has held eight hearings on reform of the U.S. Postal Service since September 2003, two hearings on “diploma mills,” one recent hearing on waste, fraud and abuse at the Federal Emergency Management Agency and two hearings on Defense Department employees’ improper use of airline tickets.

She has also held a bevy of committee meetings on homeland security topics, such as terrorist financing, the Homeland Security Department’s annual budget, chemical attacks and a bill to create a new national director of intelligence.





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