The Bush-friendly companies that ate Iraq are preparing to do the same in New Orleans

[Guest guest]

http://www.motherjones.com/commentary/columns/2005/09/whirlwind.html

 

Corporations of the Whirlwind

 

Commentary: The Bush-friendly companies that ate Iraq are preparing to

do the same in New Orleans.

 

By Tom Engelhardt and Nick Turse

 

September 14, 2005

 

" At times it is hard to ignore the comparisons between Baghdad (where

I was less than a month ago and have spent more of the last two years)

and New Orleans: The anarchy, the looting, some of it purely for

survival, some of it purely opportunistic. We watched a flatbed truck

drive by, a man on the back with an M-16 looking up on the roofs for

snipers, as is common in Iraq. Private security contractors were

stationed outside the Royal St. Charles Hotel; when asked if things

were getting pretty wild around the area, one of them replied, ?Nope.

It's pretty Green Zone here.' " (David Enders, Surviving New Orleans,

Mother Jones on-line)

 

In the decade before September 11th, 2001, " globalization, " a word now

largely missing-in-action, was on everyone's lips and we constantly

heard about what a small, small world this really was. In the

aftermath of Katrina, that global smallness has grown positively

claustrophobic and particularly predatory. Iraq and New Orleans now

seem to be morphing into a single entity, New Oraq, to be devoured by

the same limited set of corporations, let loose and overseen by the

same small set of Bush administration officials. In George Bush's new

world of globalization, first comes the destruction and only then does

one sit down at the planetary table to sup.

 

In recent weeks, news has been seeping out of Iraq that the

" reconstruction " of that country is petering out, because the money is

largely gone. According to American officials, reported T. Christian

Miller of the Los Angeles Times last week, " The U.S. will halt

construction work on some water and power plants in Iraq because it is

running out of money for projects. " A variety of such reconstruction

projects crucial to the everyday lives of Iraqis, the British Guardian

informs us, are now " grinding to a halt " as " plans to overhaul the

country's infrastructure have been downsized, postponed or abandoned

because the $24bn budget approved by Congress has been dwarfed by the

scale of the task. "

 

Water and sanitation projects have been particularly hard hit; while

staggering sums, once earmarked for reconstruction, are being shunted

to private security firms whose hired-guns are assigned to guard the

projects that can't be done. With funds growing scarce, various

corporations closely connected to the Bush administration, having

worked the Iraqi disaster for all it was worth (largely under no-bid,

cost-plus contracts), are now looking New Orleans-ward.

 

Ground Zero Iraq

 

The American occupation of Iraq began in April 2003 with a prolonged

moment of chaos that set the stage for everything to follow. In the

first days after Baghdad fell, the occupying army stood by idly

(guarding only the Oil Ministry and the intelligence services) while

Iraqi looters swept away the institutional, administrative, and

cultural underpinnings of the country. The newly installed Coalition

Provisional Authority (CPA), soon to be led by American viceroy L.

Paul Bremer, followed up by promptly disbanding the only institution

that remained half-standing, the Iraqi military. At the same time, a

new American administration was set up inside the increasingly

well-fortified and isolated Green Zone in Baghdad, staffed largely by

Bush cronies. ( " Neocon kindergarten " was the way some insiders

derisively referred to the young Bush supporters sent out from

Washington to staff the lower levels of the CPA for months at a time.)

 

The CPA then instituted a flat tax, abolished tariffs, swept away laws

that might have prevented the foreign ownership of Iraqi companies,

allowed the full repatriation of profits abroad, and threatened to

reduce state-sponsored food and fuel subsidies. For Iraqis, this was

more than just " shock and awe " ; it was to be caught in the whirlwind.

Call it Year Zero for Iraq or Ground Zero for the new Bush order.

Iraq, stripped for action, was ready to be strip-mined -- and it was

then that Washington called in its crony corporations to " reconstruct "

the land.

 

Leading the list was Kellogg, Brown & Root (KBR), a subsidiary of the

energy firm Halliburton, the mega-corporation Vice President Dick

Cheney once presided over. From providing fuel to building bases,

doing KP to supplying laundry soap, it supported the newly privatized,

stripped-down American military -- and for that it " received more

money from the U.S. involvement in Iraq than any other contractor, " a

sum that has already crested ten billion dollars with no end in sight.

The Bechtel Corporation, the San Francisco-based engineering firm,

known at home for its staggering cost overruns on Boston's " Big Dig "

and its especially close ties to the Republican Party, raked in almost

$3 billion in Iraq reconstruction contracts just in the nine months

after the fall of Saddam Hussein. Fluor Corporation, an Orange County,

California-based firm that inked a joint $1.1 billion deal with a

London company in 2004 for " construction services for water

distribution and treatment systems in Iraq " was a winner; as was the

Shaw Group Inc. which, in early 2004, opened a Baghdad office to

support " an approximately $47 million task order in Iraq for facility

upgrades, installation of utilities and other infrastructure

improvements " and was also awarded a separate $88.7 million

construction deal, among other contracts. Another successful bidder in

the Iraqi lottery was CH2M Hill, a Colorado-based company that, in a

joint venture, took in a $28.5 million reconstruction contract in 2004

and teamed up with other contractors for a $12.7 million electrical

power generation deal. These firms were joined at the table by other

heavy-hitters and a dizzying array of smaller-fry American

subcontractors, from the KBR-connected food service company Event

Source to Bechtel's marine survey subcontractor Titan Maritime.

 

Over two years after the American superpower occupied Iraq and called

in its reconstructors, however, the scorecard for " reconstruction "

looked remarkably like one for deconstruction. The country was

essentially looted and no one was left on guard, not even at the Oil

Ministry. Money was spent profligately, and sometimes evidently simply

pilfered. L. Paul Bremer himself reputedly had a slush fund of $600

million dollars in cash for which, according to Ed Harriman (who did a

superb study of the various reports by U.S. auditors on the ensuing

mayhem in the London Review of Books), there was " no paperwork. "

 

When Bremer left Baghdad in June of last year, the CPA had already run

through $20 billion dollars in Iraqi funds, mostly generated by oil

revenues and earmarked for " the benefit of the Iraqi people " (though

only $300 million in U.S. funds). Much of it seems to have gone to

American companies for their various reconstruction tasks. U.S.

auditors, Harriman reports, " have so far referred more than a hundred

contracts, involving billions of dollars paid to American personnel

and corporations, for investigation and possible criminal

prosecution. " It was evidently a field day of malfeasance and -- a

particular signature of the Bush administration -- lack of

accountability. In the meantime, KBR was massively overcharging the

Pentagon for all those privatized tasks the military no longer cared

to do, while its officials were living the good life. (Typically,

KBR's " tiger team " of accountants, sent out to Kuwait to check on

company overcharges, stayed in a five-star hotel to the tune of $1

million in taxpayer money.)

 

The results we now know well. Electricity and oil production, for

instance, still remain at or below the figures for the worst days of

Saddam Hussein's embattled regime; and on that cleared land at Ground

Zero Iraq, a fierce resistance movement rages, while, from Basra to

Mosul, disappointment with and disapproval of the American occupiers

only grows.

 

Now, these same corporations are being loosed on the Southeastern

United States on the same no-bid, cost-plus basis. Like Baghdad and

much of Iraq, New Orleans and the Mississippi coast have just

experienced " shock and awe " -- Katrina's winds and waters, not U.S.

cruise missiles. With troops occupying New Orleans, the Bush

administration-allied corporations of the whirlwind that feed off

chaos and destruction are already moving in. In this sense, the next

wave of chaos has, from their point of view, arrived like the

proverbial cavalry, just in the nick of time.

 

Bringing the Post-War Home

 

As Reuters reported recently, " A slowing of reconstruction work in

Iraq has freed up people for Fluor Corp. to begin rebuilding in the

U.S. Gulf Coast region after Hurricane Katrina, the big engineering

and construction company's chairman and chief executive said on

Friday. ?Our rebuilding work in Iraq is slowing down and this has made

some people available to respond to our work in Louisiana,' Fluor

chief Alan Boeckmann said in a telephone interview. " And Fluor

responded in a thoroughly reasonable way -- they put an experienced

man on the job, sending their " senior project manager " in Iraq to

Louisiana.

 

In fact, with Congress already making a $62 billion initial down

payment on post-Katrina reconstruction work, the Bush administration

has just given out its first 6 reconstruction contracts, five of them

-- could anyone be surprised -- to Iraqi reconstructors, including

Fluor. Small world indeed. The Bush version of crony capitalism should

perhaps be termed predatory capitalism, following as it does so

closely in the wake of war and natural disaster much as camp followers

used to trail armies, ready, in case of victory, to loot the baggage

train of the enemy.

 

But let's pull back for a moment and try to reconstruct, however

briefly, at least a modest picture of the massively interconnected

world of the reconstructors. A good place to start is with George

Bush's pal Joseph Allbaugh, a member of his " so-called iron triangle

of trusted Texas cohorts. " Allbaugh seems to display in his recent

biography just about every linkage that makes New Oraq what it is

clearly becoming. He ran the Bush presidential campaign of 2000; and

subsequently was installed as the director of FEMA which, in

congressional testimony, he characterized as " an overstuffed

entitlement program, " counseling (as Harold Meyerson of the American

Prospect pointed out recently) " states and cities to rely instead on

?faith-based organizations... like the Salvation Army and the

Mennonite Disaster Service. "

 

As at the Coalition Provisional Authority in Baghdad, so at FEMA in

Washington, the larder of administrators would soon be stocked with

second and third-rate Bush supporters and cronies. Five of FEMA's top

eight managers would, according to Spencer S. Hsu of the Washington

Post, arrive with " virtually no experience in handling disasters, "

three of them " with ties to President Bush's 2000 campaign or to the

White House advance operation. " A " brain drain " of competent

administrators followed as -- à la the Pentagon -- FEMA's focus turned

to the war on terror, money was drained from natural-disaster work,

and the agency was " privatized " with previously crucial activities

outsourced to Bush-friendly corporations.

 

In March 2003, Allbaugh departed FEMA, putting the increasingly

starved and down-sized operation in the hands of Michael Brown, an old

college buddy whose previous job had been overseeing the International

Arabian Horse Association. He then made his faith-based career choice

-- no, not to join the Salvation Army or the Mennonite Disaster

Service. Instead he opted for what the Bush administration really

believed in -- both in Iraq and at home. He became a high-priced

consultant/lobbyist, founding in the ensuing years three consulting

firms. At Blackwell Fairbanks, LLC, he teamed up with Andrew

Lundquist, who led the Dick Cheney task force that produced the

administration's National Energy Policy, to " successfully represen[t]

clients before the executive and legislative branches of the United

States government. " Then there was the Allbaugh Company through which

he represents Halliburton's KBR as well as military-industrial

powerhouse Northrop Grumman. Finally, there was New Bridge Strategies,

LLC, where he serves as chairman and director. New Bridge Strategies

bills itself as " a unique company that was created specifically with

the aim of assisting clients to evaluate and take advantage of

business opportunities in the Middle East following the conclusion of

the U.S.-led war in Iraq. "

 

Not surprisingly, the firm's vice chairman and director, Ed Rogers

(who, during the " 2004 campaign cycle... made over 150 live TV news

appearances defending and promoting the Bush administration " ) also

serves as vice chairman of the consulting firm Barbour, Griffith &

Rogers, Inc. (which he founded with Haley Barbour, now the governor of

storm-battered Mississippi); New Bridge's Director, Lanny Griffith,

who serves as the CEO of Barbour, Griffith & Rogers, " was national

chairman for the Bush/Cheney Entertainment Task Force and coordinated

entertainment for the 2001 Bush Inaugural. " He was, typically enough,

one of the 2004 Bush campaign's " Rangers " -- an elite group of

fundraisers, each of whom was responsible for gathering up over

$200,000 for the President; while New Bridge Strategies' Advisory

Board Member Jamal Daniel is " a Principal with Crest Investment

Company " -- a firm co-chaired by the president's younger brother Neil.

 

In answer to critics who claimed he and others were cashing in on

their service to Bush and Cheney, Allbaugh responded, " I don't buy the

?revolving door' argument. This is America. We all have a right to

make a living. "

 

As President and CEO at Allbaugh Co. and assumedly as a former head of

FEMA, not to say as close friend and mentor to FEMA's (now departed)

head and as a Presidential pal, he found himself at the front of the

Katrina disaster line, apparently pushing hard (although he denied it)

for such companies as -- you guessed it -- KBR and the Shaw Group. By

September 7 at the latest, unlike the administration, he was down in

Louisiana surveying the damage in the Gulf Coast and the wreckage of

the agency he once presided over, while directing his clients to the

lucrative world of American disaster, now that the lucrative world of

Iraqi disaster had been sucked reasonably dry.

 

Ground Zero New Orleans

 

On September 12, 2005, the Wall Street Journal reported, " FEMA and the

Army Corps of Engineers have awarded six contracts, most for as much

as $100 million, for recovery and rebuilding work. " It should be of

little surprise that the Shaw Group landed two of these $100 million

deals (a FEMA contract to refurbish existing buildings and for other

emergency housing tasks as well as an Army Corps of Engineers contract

to aid recovery efforts, including pumping water from New Orleans).

Others on the list included a who's who of favorite Bush

administration contractors from Iraq: Bechtel, Fluor, and CH2M Hill

(all signed on to construct temporary housing). In fact, of the

companies on the Journal's list, only one (Dewberry, LLC) was not,

apparently, involved in Iraq. Halliburton was, of course, not left out

in the cold. In the immediate aftermath of the hurricane, its KBR

subsidiary reaped " $29.8 million in Pentagon contracts to begin

rebuilding Navy bases in Louisiana and Mississippi. "

 

These companies, however, aren't the only ones returning from Iraq,

like so many predator drones, to pick up lucrative deals. In the wake

of Katrina, Intelsat, a global satellite services provider that, in

Iraq, had teamed up with Bechtel on a big USAID reconstruction

program, agreed to new post-Katrina contracts with the Defense

Department and FEMA. Similarly, just two days after Katrina ravaged

the Gulf Coast, the Air National Guard contracted with another

satellite services provider, Segovia, which, according to a 2004

company press release, had " emerged as a key telecommunications

provider for the Iraqi reconstruction efforts. "

 

Along with their service in Iraq, the Katrina reconstruction companies

are tied together in another important way. They tend to be

particularly well linked to the Bush administration and the Republican

Party. As former Oklahoma Republican Governor Frank Keating said of

Allbaugh, " Joe... knows how elected officials and appointed officials

like me think and work, and that culture is a fraternity. "

Halliburton, for instance, picked off " another high-level Bush

appointee, Kirk Van Tine, earlier this year to work as a lobbyist.

Similarly, in 2001, Bush appointed Robert G. Card, then a senior vice

president at CH2M Hill, undersecretary at the U.S. Department of

Energy, a position he held until 2004. Today, Card is the president

and group chief executive of the International Group at CH2M Hill.

 

Not surprisingly, during the 2004 election season, CH2M Hill was the

top " construction services " contributor to political campaigns,

sending nearly 70% of its $476,800 in contributions to Republican

candidates. In fact, fourteen people on the CH2M payroll contributed

to Bush's 2004 campaign, including the company's chairman and CEO,

president, senior vice-president, and president of regional

operations, each of whom gave between $1,000 and $2,000. Meanwhile,

Bechtel's political action committee contributed 68% of its funds to

Republican candidates and causes; while Halliburton, which ranks among

the top twenty " Oil and Gas " contributors to political campaigns,

handed out 87% of its money to Republicans.

 

Theoretically, there should be nothing more glorious than the job of

healing the war-torn or rebuilding the lives of those devastated by

natural disaster, nor anything more relevant to government.

Unfortunately, in the case of KBR World, there's nothing glorious

about it, except the 5-star hotels for the reconstructors. Prediction

is usually a dismal science for any writer. In this case, however,

it's already easy to imagine -- as some Democrats in Congress are

beginning to do -- the consequences of Bush-style " reconstruction " in

the United States.

 

Those no-bid, cost-plus contracts already being dealt out to the usual

suspects tell you what you need to know about future cost-overruns,

klepto-reconstruction activities, and the like which are practically

guaranteed to deconstruct the bulk of the Gulf Coast and leave New

Orleans, the destroyed parts of Mississippi, and the hundreds of

thousands of evacuees, not to speak of Congress, gasping for breath

amid a landscape largely sucked dry, not of water, but of cash and

sustenance.

 

George Bush's version of capitalism is of a predatory, parasitical

kind. It feeds on death, eats money, goes home when the cash stops

flowing, and leaves further devastation in its wake. New Orleans, like

a rotting corpse, naturally attracts all sorts of flies. Reports have

been trickling in that the private security firms -- call them

mercenary corporations like Blackwater USA -- which have flooded Iraq

with an estimated twenty to twenty-five thousand hired guns (some paid

up to $1,000 a day), have been taking the same route back to New

Orleans and the Mississippi coast as KBR, Bechtel, and the Shaw Group.

 

They first arrived in the employ of private corporations and local

millionaires who wanted their property protected. A week or so into

September, however, Jeremy Scahill and Daniela Crespo of Democracy

Now! found the hired-guns of Blackwater cruising the streets of New

Orleans, carrying assault weapons, claiming to have been deputized,

insisting that they were working for the Homeland Security Department

and that they were sleeping in camps the Department had organized.

( " 'When they told me New Orleans, I said, " What country is that in?, " '

said one of the Blackwater men. " ) Then, on September 13, the

Washington Post reported that " Blackwater USA, known for its work

supporting military operations in Iraq, said it would provide 164

armed guards to help provide security at FEMA sites in Louisiana. "

 

Today, New Orleans' streets are under military occupation; its

property is guarded by hired guns; and the corporations of the

whirlwind are pouring into town. All that's missing is the insurgency.

 

Tom Engelhardt, who runs the Nation Institute's Tomdispatch.com ( " a

regular antidote to the mainstream media " ), is the co-founder of the

American Empire Project and the author of The End of Victory Culture,

a history of American triumphalism in the Cold War.

 

Nick Turse works in the Department of Epidemiology at Columbia

University and is Associate Editor and Research Director of

TomDispatch. He writes for the Los Angeles Times, the San Francisco

Chronicle, the Village Voice and regularly for Tomdispatch on the

military-corporate complex and the homeland security state.

 

Copyright 2005 Tom Engelhardt and Nick Turse

 

This piece first appeared at Tomdispatch.com.