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Corporate corruption and the Bush Administration

by Mick Brooks Friday, Jun. 13, 2003 at 1:03 PM


In Defense of Marxism-

Workers International League-

Corporate corruption and the Bush administration

By Mick Brooks

Everyone knows George W. Bush is a super-patriot. Well, actually he started his career as a draft dodger. Fair cop, his supporters may say, but so did Clinton. Actually socialists have nothing personal against opponents of the Vietnam War who refused to serve. And we feel no need to defend Bill Clinton, a millionaire and an aggressively pro-capitalist politician. But at least he refused to serve in Vietnam because he was against the War. Bush was all in favour of the Vietnam War. He just thought only poor people should fight and die there.

So daddy pulled some strings so son could do time in the Texas Air Rangers, defending Texas from the Vietcong. Older readers may recall that the Vietnam War was fought entirely in Vietnam and the Americans caused 3 million civilian deaths. Vietnam is a long way from Texas. In any case George was not inclined to take his duties too seriously. He spent most of his time AWOL (Absent With Out Leave - a deserter) on alcohol and drugs fuelled rampages. Supporters of world peace may note that he did little harm to anyone other than himself then, unlike his more recent binges on his new drugs of choice - greed and fanaticism. The story of daddy pulling strings for his moronic offspring is one big constant in the George W. Bush story.

Never short of a few dollars, George's career as a business leader began as director of Harken Energy. As a man with access to the books Bush knew the shares were going to go down. He sold out first. This was very sensible: it is also a criminal offence called 'insider dealing'. Bush's malfeasance attracted the attention of the Securities and Exchange Commission, the American equivalent of the Fraud Squad. Later, though, the investigation was dropped. Why? The facts are not in doubt. The shares went down, Bush knew they would, and he sold out before they did. So why drop the case? Here's a clue. His father was President of the United States at the time.

When Bush headed for the White House, he was backed by a wall of money - bent money. Fund-raiser-in-chief for his electoral campaign was Kenneth Lay, former chief executive of energy company Enron. Bush used to call him 'Kenny boy' before he found it prudent to distance himself from the crook. Lay was almost single-handedly responsible for a disappearing act on assets of billion, the biggest corporate fraud in American history. As we have pointed out in an earlier article, Enron went from nothing to billion and then back again. What did it ever produce? Nothing. Enron was a trader. What did it have to sell? It bought political influence in the States. Thirty-five members of the Bush administration were on the payroll or in receipt of 'donations' Enron then exported this political influence all over the world. Essentially it bought politicians in every continent and then mysteriously won the tenders for privatised energy projects.

After siphoning off the assets into a maze of holding companies, Lay clambered out of the wreckage of Enron. Who lost out when all the money went missing? Once again it was the workers and the shareholders not in the know - the outsiders - who took the hit. Lay unloaded his own shares to outside speculators before the shipwreck. Outsiders are known by the technical term of 'suckers' at the George W. Bush school of political economy.

Readers who have got so far may wonder if the Bush dynasty has ever pursued interests other than that of their own pockets. Fear not, these are politicians in search of an ideal! Unfortunately brother Jeb Bush, Governor of Florida, and his confederates (!) are harking back to the rotten ideal of segregation, when blacks were barred from voting in southern states. They have drawn the conclusion that blacks are unfit to vote. Why? Jeb and the Republican machine are mindful of the fact that 93% of black people who actually get to go to a polling station cast a vote for the Democratic Party. And Jeb has taken the appropriate measures.

A firm called ChoicePoint, a subsidiary of Datastream Technologies, won the contract to register Florida voters. Strangely, the board of Datastream is packed with Republican bigwigs. If you remember the 2000 Presidential election, forget all that arcane stuff about hanging chards. This is the story that shows how the Florida vote, and the Presidency, was stitched up in the two years before polling day. ChoicePoint decided to debar felons who had moved in from outlying states from the right to vote. They decided to do this despite the fact that 90% of the 57,000 scrubbed were innocent of any crime that disenfranchises voters. And another 47,000 whose right to vote had been restored were also knocked off the register.

The Republicans were making up the rules as they went along. In effect they made up a Florida state rule to affect a national election. It is like Saints turning up at the Cup Final and claiming Southampton rules give all team members the right to handle the ball. It is not on!

Paradoxically, as a result of the heroic drives to register black voters in the fight against segregation, ChoicePoint can identify which voters are black - or Hispanic, another despised and 'dubious' section of the electorate. They set to work with a relish, appropriating the names of out-of-state villains and crossing off the register anyone with a similar name. For instance one Thomas Butler Copper was convicted of a felony in Ohio. So any black person called Thomas Butler was wiped from the Florida rolls. And get this. ChoicePoint records show Thomas Butler Cooper was 'convicted' in Ohio on 30 Jan 2007! (See for more on this.) Over 90,000 mainly black voters were deprived of the right to vote. Let us remind ourselves that Bush won Florida, and the Presidency, by 537 votes.

It is fair to say, then, that Bush won the Presidency by fraud. He has carried on as he began. In the wake of September 11, and the wars in Afghanistan, Pentagon spending has soared to a mouth watering 0 billion. It is considered unpatriotic to question where all this money goes. The Pentagon owns up to 'losing' trillion on previous budgets. We have to ask - did it just drop down behind a filing cabinet? After all, the package includes 56 aeroplanes, 32 tanks and 36 missile launchers.

The Pentagon Procurement Agency is a revolving door for magnates who one year are acting on behalf of the state handing out contracts and the next on the boards of the companies that profit from government favours. Nine members of the Agency have links to contractors with billion invested in 'defence'. Nearly all the members of the Bush administration have a background as executives in arms companies. Defence Secretary Rumsfeld is a former director at General Dynamics. Just to show he runs with the hare and hunts with the hounds he was also non-executive director to ABB, who sold light water nuclear reactors to North Korea. His deputy Wolfowitz was a consultant to Northrop.

Ordinary people in Iraq are at their wits' end after the invasion. They can't get energy or clean water. Disease and diarrhoea (a killer of undernourished children) are spreading. But this is a Klondike for big business with privileged access to the Bush administration. Hence the squabbling in the White House. Hence the squalid behind-the-scenes deals between the imperialist powers. The killer lioness (the USA) has let the jackals (France and Russia) make off with a few scraps of offal, while it gorges itself on the carcass of its prey. Woe to the vanquished! And the Brits are also pathetically trying to butt in and get a slice of the action. "It seems a bit grubby trying to make a profit out of Iraq, but in the real world you have to make a profit," comes a plaintive voice from the City.

Iraq has 112 billion barrels of oil, the second largest reserves in the world. Last year it pumped out billion of crude. It has no chance of repeating that in the chaos of 2003.

Just upgrading Iraq's oil wells from the general destruction is reckoned to cost .5 billion. To rebuild the country will cost billion over two years. Congress has allocated just .5 billion for reconstruction. This contrasts with billion earmarked for the War to wreck the joint. For instance the US military serenaded Baghdad residents on the first night of the air war alone with 320 cruise missiles costing 6 million.

So where will the money come from? Bush is quite happy for other advanced countries to offer aid to rebuild a country American arms have lain waste. This 'aid' will be lobbed at the vast US construction companies who are the real beneficiaries of Iraqi 'freedom'. But mostly the resources will come from the Iraqi people. Their oil will be held 'in trust' as collateral by the robbers.

And what robbers! In a closed and secretive process the US Agency for International Development shortlisted six all-American companies in charge of post-war reconstruction. Eventually they put Bechtel in charge of post-war reconstruction for the biggest slice of a cool .4 billion. Why Bechtel? Does this represent value for money? A lot of people in the State of Massachusetts doubt it. Bechtel was in charge of the 'big dig' - the project for a road underneath Boston. This has the cachet of being the biggest cost and time over-run in the history of American public projects. Now weighing in at .8 billion, in 1985 it was costed at .5 billion. The biggest over-runs occurred when the Republican Mr. Natsios was in charge of US highway procurement - guardian of the public purse. The Iraq contract was handed to Bechtel by the now head of USAID - the same Mr. Natsios. George Schultz, a minister in previous Republican administrations, is a director of Bechtel. He is also chair of the Committee for the Liberation of Iraq, clearly a lobbying group that gets what it wants.

In charge of fighting oilfield fires and putting up squaddies is the firm Kellogg, Brown and Root, a subsidiary of Halliburton. The former chief executive of Halliburton is Dick Cheney, Vice-president of the United States. Like Bush, Cheney dodged the draft. He comments, "I had other priorities at the time." Presumably he means lining his pocket. Cheney continues to hold stock and gets a subvention of 0,000 a year from Halliburton. Money well spent! KBR is already in charge of housing American occupying troops in Afghanistan, a deal worth 0 million. It's good to be friends with the Veep.

Then there's James Woolsey, late of the CIA and adviser to George Bush. On the one hand he advises the President that there is a clear and present danger of terrorist attack and the government should spend money on anti-terrorist measures. Part of Woolsey's advice was to talk up the anthrax threat (all made in the USA, as we now know) and to underline the al-Qaeda/Iraq link (there isn't one). On the other hand as director of Paladin he sells security systems to the government. He presses the button. Then he answers the call. Nice work if you can get it!

One of the most sinister of these outfits is venture capitalist Carlyle, a firm that went from nothing to billion in assets over 15 years. All the while they offered shareholders returns of 36% per annum. How do they do it? They know what's going to happen because they hire the people who take the decisions. And after the decisions have been taken, they make money out of them. Essentially they buy political decision-makers. Known as the "ex-Presidents' club" Carlyle was put together by ex-Secretary of Defence James F. Carlucci. They have had links with James Baker, a former Secretary of State, George Bush's dad, John Major (a man so mediocre he almost makes George W. Bush look good) and - a bit of a surprise, this one - the bin Laden family.

How to sum up? We hope the reader now knows that the Bush administration is a thieves' kitchen. Quite possibly you knew that already. But when endemic corruption arises, it is possible to misunderstand the process that is going on. We are not talking about naïve politicians in the third world tempted by the rustle of wads of dollars. Bush and his gang were born into big business and are an important part of the establishment in the States. What we see is a corrupt symbiosis between capitalist politicians and the big corporations.

None of the favoured firms involved in the tendering process are developing the productive forces. Often they are dependent on the US Army to destroy so they can then rebuild. They don't really compete, unless you consider firing money at politicians for access to monopoly contracts as a form of competition.

Joseph Stiglitz, former Chief Economist at the World Bank and a man devoted to stirring it up, sums up their approach, "They talk a free-market ideology but, if you look at their politics in terms of bailouts and protectionism, it is not a free-market policy: if you look at their procurement agenda and what they did with Bechtel in Iraq, it doesn't even look like a fair competition agenda. So you have to sort of suspect an element of ideology but more an element of particular groups seizing control." Stiglitz is clearly a bit distressed that we don't have 'proper' competitive capitalism any more. Well we've moved beyond that. Socialists have come to bury capitalism, not to praise it.

The nature of the Bush administration can be summarised like this. Capitalist politicians linked to giant companies compete for the most valuable prize of the lot - access to the state pork barrel. They nuzzle the rest out of the way. It's vile, but that's capitalism for you these days. Investigative journalist Greg Palast puts it this way. "In the old days crooks like Al Capone would buy a judge." Capone had to buy judges because he wasn't part of the establishment. Palast goes on, "but that's tough, paying off one judge at a time. So the now crooks just buy the government and get new laws." Actually it's worse than that. The crooks are the government.

June 2003.

See also:

The world after the war in Iraq By Alan Woods (May 6, 2003).

The cost of more Guantanamos By Michael Roberts (April 28, 2003).

The world economy after Iraq By Michael Roberts (April 27, 2003).

Class War Heats Up in the US. By John Peterson (April 10, 2003)

The beginning of the end of the US empire? By Michael Roberts (February 28, 2003).

World economy 2003: hope and reality by Michael Roberts (December 29, 2002).

[Back to In Defence of Marxism] [Back to Economy][Back to US]

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