The Halliburton Riddle

“We know what the meaning of i$, i$ to Halliburton. It is by far the largest beneficiary of the invasion and occupation of Iraq. With no-bid, no-ceiling contracts, the company has already amassed $2 billion in work. It is doing everything from restoring oil facilities to providing toilets for troops. A year ago Halliburton was staring at nearly a half-billion dollars in losses. In the second quarter of 2003 it posted a profit of $26 million.”

—Derrick Z. Jackson, “Cheney’s Conflict with the Truth,”  

The Boston Globe (September 19, 2003)

“I’ve severed all my ties with the company, gotten rid of all my financial interests. I have no financial interest in Halliburton of any kind and haven't had now for over three years.”   —Vice President Dick Cheney, on NBC’s Meet the Press, September 14, 2003

Manifest Destiny

In today’s fast-paced, constantly-changing world, members of the working class—especially those in America where vacation/holiday time is extremely limited, find it increasingly more difficult to maintain regular contact with old friends and extended family members. To be able to spend time with the same group of friends at least once or twice every year is almost unheard of. Vice President Dick Cheney, in spite of his rigorous schedule, however, has been able to maintain a relationship with the owners of the Armstrong Ranch in South Texas, for more than thirty years and “sometimes hunts there several times a year.”[1] 

Such a relationship cries out for more scrutiny than it has been given in the press so far.  Cheney’s “peppering” of Texas attorney Harry Whittington with gunshot is not notable in and of itself; it is the frequency with which such hunting trips have taken place that piques the imagination. The ranch where the shooting occurred is owned by the family of Anne L. Armstrong, a former director on the board of Halliburton for twenty-three years (1977-2000), serving not only as a high-level corporate committee member on the management oversight committee and the corporate governance committee, but, in particular, on the very nominating committee which in 1995 chose Dick Cheney as its president and eventually as Halliburton’s chairman. 

Cheney has denied any persisting ties with his former employer—the same corporation which has reaped massive profits from the Bush-Cheney debacle in Iraq—leaving us to speculate what it is that entices such an inept hunter back to that ranch year after year.  The failure of Cheney and his hosts to notify the proper authorities for more than twenty-four hours after the shooting further incites an inquisitive mind to inquire whether other persons with longstanding relationships to Halliburton and the Vice President were allowed to skulk away, undetected by law enforcement or members of the press.

The Armstrong Ranch has been called “kind of a rite of passage for Texas Republicans. You go pay homage.”[2] That statement contains overtones of an obeisance required, yet undefined. The suggestion that the Armstrong family has a long Republican tradition must be viewed in light of Texas’ short history of voting Republican—a tide which did not even begin to turn until Texas elected its first Republican U.S. Senator (John Tower) in 1961 and its first Republican governor (Bill Clements) in 1978. Nevertheless, the process by which Texans wormed their way into the Republican power structure deserves our attention. That power shift occurred at the same point in time that destiny brought together Donald Rumsfeld, Richard B. Cheney and Anne L. Armstrong.  Destiny embodied in the form of Richard M. Nixon…and made manifest in the person of John B. Connally, Jr.

Economic Opportunities

Donald Rumsfeld was the first of the trio to receive a bid into the Nixon White House—an invitation which resulted from Nixon’s approval of the way Rumsfeld handled a political confrontation with a program touted by Democrats in August of 1966. As a young Republican Congressman from Illinois, Rumsfeld had launched a vicious series of attacks upon a project called “Mohole,” viewed by him as a boondoggle for President Lyndon Johnson’s long-time supporter, Brown & Root. So successful was Rumsfeld’s attack that what Drew Pearson and Jack Anderson a “purely non-political project”—designed by the National Science Foundation to learn the cause of earthquakes and volcanoes—was terminated, notwithstanding the fact that Brown & Root continued to be awarded much more lucrative military contracts in Vietnam.  

Pearson and Anderson accused Rumsfeld of having attacked the wrong Brown & Root contract, of having missed the real story—“that Brown and Root have been financing Lyndon Johnson for years, put up around $100,000 for him when he was running as a young Congressman from Texas. And today the defense contracts they have been getting from the Government are far greater than the piddling $19.7 million which the House last week lopped off the Mohole project…”[3]

One week before Mohole was axed, Congress had authorized spending of almost half a billion dollars “for military construction money [for Vietnam], of which Brown and Root will get a substantial share.”[4] Almost as an afterthought the columnists added: “Brown and Root also prospered under President Eisenhower. They were given a large slice of the contract to build military bases in Spain at a cost of around $2 billion. The George Brown family at that time was contributing not to Mr. Eisenhower but to the Democrats.”[5] 

That’s nice work, if you can get it. 

Two years later Richard Nixon had replaced Lyndon Johnson in the White House, and he remembered Rumseld’s performance. He wanted that young man on his team and offered him a job in his administration—at the very bottom rung, the Office of Economic Opportunity. Rumsfeld quickly accepted. At his first opportunity Rumsfeld called in a young legislative aide with whom he had crossed paths—Dick Cheney. It boggles the mind even to attempt to visualize these two men working to expand economic opportunity for the impoverished; social workers they are not. Both were, however, extremely hard-working and ambitious and did not remain long in the cellar. Late in 1970 Rumsfeld also took on the added assignment of White House Counselor and would ultimately be replaced at OEO by another of today’s military-industrialists, Frank Carlucci of the Carlyle Group. 

One year later, Rumsfeld was named Director of the Cost of Living Council, a new position created under the Economic Stabilization Act of 1970, and he brought Cheney over as his deputy. The importance of the Cost of Living Council at that particular time cannot be over-emphasized.  Before we had a war on drugs or a war on terror, we were fighting a war against inflation.  As the end of the war in Vietnam was approaching, the looming fear was that America would not be able to sell enough products overseas to compensate for its increasingly insatiable demand from foreign sellers.  Bankruptcy thus haunted the Nixon Administration in 1970 and 1971, much as it had Grover Cleveland’s presidency in the 1890’s. 

When John Connally took control of the Treasury Department in February 1971 after the resignation of Secretary David M. Kennedy of Chicago, the picture was bleak.[6] In 1973 Connally told a group of Canadians in Toronto:

By the middle of 1971 the American trade balance was in rapid decline. Moreover, we could no longer maintain the fiction that the dollar was convertible into gold when in fact those dollars increased to a ratio of six to one over our gold reserves during the 1960s and the 1970s. We had simply expended our surplus and extended our credit until both were exhausted. The American image of invulnerability was clearly a delusion. It was again demonstrated that no nation is so large and so powerful that it is invulnerable to change.[7]

Closing the gold window

Connally’s selection by Nixon was a curious choice. He was still a Democrat at that time and had no obvious ties to anyone in the Nixon White House. Perhaps he had been hand-picked by Nixon’s former New York law firm—Mudge, Rose—which represented Paribas, a 19th-century offshoot of the Rothschild-controlled Banque de Paris et des Pays-Bas. Connally, an attorney, was a partner in the Houston law firm of Vinson & Elkins, whose senior partner, James A. Elkins, Jr., had inherited a large block of stock in the First City National Bank of Houston—for which Connally served as a director. A 1976 Congressional investigation would subsequently reveal that the large Houston bank had partnered with numerous Rothschild-affiliated banks in joint ventures such as Rothschild Intercontinental Bank, Ltd. of London and New Court Securities Corp. of New York.[8] The Washington Post reported in 1969 that the Rothschilds were “rebuilding their international financial empire through the Five Arrows Group … composed of London’s N.M. Rothschild, Baron Guy’s Paris Rothschild bank, Cousin Edmond’s Geneva-based Banque Privee, the Banque Lambert of Brussels, in which the Rothschilds have a substantial minority stake, and Pierson, Heldring and Pierson, an independent Dutch bank long associated with the family.”[9]

Early in 1969 Connally had also been elected to Halliburton’s board, and he would be “re-elected” in November 1972 after having served seventeen months as Secretary of the Treasury.[10] Halliburton had also been a client of Vinson & Elkins, and it would remain so until 2002 when the corporation moved its business to Houston rival firm, Baker & Botts, the law firm headed by Bush friend James A. Baker III. Connally’s gigantic challenge during his short term of office was to “close the gold window,” thus ending the United States’ legal obligation to exchange dollars held by foreign banks for gold. 

Connally was neither a banker nor an economist, and he was never a wealthy man—compared to the Vanderbilts, Whitneys and the like. But he was a lawyer for wealthy and powerful men, among whom he circulated his entire life—whose names remain shrouded in secrecy behind corporate facades.  Connally’s underlings in the Nixon administration—Rumsfeld and Cheney—also rose from economic stations that would be termed, at most, middle class, neither of them ever having achieved any degree of education, accomplishment, or even competence that would justify the arrogance each has exhibited in the last decade. The Cost of Living Council in which Rumsfeld and Cheney were members was, of course, chaired by Treasury Secretary Connally until he resigned in 1972. 

During that same era, Anne Armstrong would also ascend from her lowly position as adviser on women’s issues to take a place at the Cost of Living Council, as Rumsfeld advanced to a brief tour at NATO (where he acted as a front man for Henry Kissinger), before serving as President Gerald Ford’s Secretary of Defense after Nixon’s resignation. Connally, Rumsfeld, Cheney and Armstrong—of those four, three would serve as directors of Halliburton. The fourth, Rumsfeld, as Secretary of Defense would help George W. Bush engineer the war in Iraq, to Halliburton’s benefit.

What a small world! 

Who Really Owns Halliburton?

The answer to the Halliburton riddle lies in history. It is a complex tale that takes one through the Indian lands of Oklahoma to California high society; back to the ranches and oilfields of Texas and the skyscrapers of Dallas and Houston. For now, it is the question that is most important—a question the media has yet to ask, much less to answer.

ENDNOTES:

[1] Anne E. Kornblut, “Cheney Shoots Fellow Hunter in Mishap on a Texas Ranch,” The New York Times (February 13, 2006).

[2] Harvey Kronberg in The Quorum Report, quoted in Rick Lyman and Anne E. Korblutt, “The Ranch Where the Politicians Roam,” The New York Times (February 19, 2006).

[3] Drew Pearson and Jack Anderson, “The Washington Merry-Go-Round:  Contractors’ Gift Not Linked to Mohole,” The Washington Post, Times Herald (August 26, 1966), E15.

[4] Ibid.

[5] Ibid.

[6] Kennedy’s resignation may have resulted from the Administration’s embarrassment suffered after the visit of the Rothschild-connected President of France, Georges Pompidou, a few months earlier, as discussed in “Sophistsand Other Scoundrels, Part 1.” 

[7] Joint Meeting of the Empire Club of Canada and The Canadian Club of Toronto (March 19, 1973). Connally, in response to a question raised following his speech (he was asked whether a decision by another nation such as Canada “to conserve its oil, gas, water, mineral and other resources and limit delivery of those to the United States, would … be accepted philosophically by your country … or might we expect political, economic or military pressure to reverse it”), exhibited an attitude of frustration with “nationalism” that has become more prevalent in the years since Connally passed from the scene. He answered as follows: “What you have is yours. You can do with it what you wish; that's your prerogative as a sovereign nation. I would assume that if you are going to deny all your oil, your gas, your water, your timber, your resources, your nickel, your gold or your coal, whatever you have in the way of natural resources, you're going to deny those to the United States in order to conserve them yourselves. I assume that you will equally deny them to other nations around the world.  Under those circumstances I don't know that the United States would have any cause to complain at all.  If, on the other hand, if you denied them only to us and continued to market them and ship them to other nations around the world, I don't know how we could do anything but assume that this was a punitive action taken directly against the United States and then you might hear a little flap about it…. So I think we all have to frankly use our best efforts to put down this increasing wave of nationalism that's sweeping the world.” [italics added]

[8] “International Banking: A Supplement to a Compendium of Papers Prepared for the Fine Study,” Staff Report of the House Committee on Banking, Currency and Housing. 94^th Cong., 2d Sess. (1976). The embedded link allows one to search the article. A search for the word Rothschild brings up nine hits.

[9] Lawrence Malkin, “Rothschild’s Draws on Past to Forge New Global Links, Washington Post, Times Herald (April 6, 1969), 105.

[10] New York Times (November 29, 1972), 64.