NO administration in the history of the United States has enjoyed the kind of intimate ties with corporate interests as the one headed by George W. Bush. The number of former private corporate chief executive officers (CEOs) in the Bush team is unprecedented. Starting from Bush and Vice-President Dick Cheney, the list of former CEOs occupying top positions includes Treasury Secretary Paul O'Neill, Defence Secretary Donald Rumsfeld and Commerce Secretary Donald Evans. The Bush administration's ties with the private corporate sector are well known; its relationship with the energy industry, notably petroleum companies, is particularly striking. Speaking at a peace rally recently, Ralph Nader, who challenged Bush in the last elections, said: "This is a government that is marinated in oil."
George W. Bush, President: Hailing from Texas, the traditional home of the U.S. oil industry, George Bush has been involved with the industry for more than 25 years. In 1976, he started Arbusto Energy Inc. (arbusto means bush in Spanish), which aimed to explore for oil. Bush failed in his attempt to enter the House of Representatives in 1978 and Arbusto's public issue in 1982 also fared miserably. Luck eluded the company even after it changed its name to Bush Exploration. In 1984, with the company desperately in need of capital infusion, Bush merged it with Spectrum 7 and took over as its CEO. In 1986, The New York Times described Spectrum as being "more interested in creating tax shelters" than in prospecting for oil. The company continued to slide during the 1980s as oil prices crashed.
In 1987, a company named Harken Oil, with connections to George Soros, the prominent U.S. investor, took over Spectrum 7. Bush was one of the directors of the company, drawing $80,000 for a consulting contract, $500,000 worth of stock options in Harken and other options worth $131,250. Bush's induction into the board set Harken on the road to high growth. The Harvard Management Company, which manages the Harvard University's vast endowment, invested more than $20 million in Harken. Between 1986 and 1989, Harken's revenues increased from $4 million to $1.1 billion. In 1987, Bush started focussing on his father's presidential campaign and in 1988, after George H.W. Bush was elected President, the junior Bush was offered 25,000 shares by Harken. Harken also arranged for low-cost funds to facilitate Bush's acquisition.
There have been allegations that Bush's presence in Harken had more to do with his "connections" than any expertise in the oil and gas business. In 1990, a reputed oil industry journal reported that a Harken subsidiary located in the Cayman Islands, a tax haven, signed an oil production-sharing contract with the Government of Bahrain. Industry sources expressed surprise at that time because the company had no experience whatsoever in international oil exploration. There were also reports that Chevron, the giant oil company, advised the Bahrain government to choose Harken over other options. Commenting on the deal, in December 1991 The Wall Street Journal wondered whether the deal was an attempt by vested interests "to cosy up to a presidential son". Although Harken struck only "dry holes" in its exploration venture, Bush himself fared better. He sold more than two-thirds of his holding in Harken for about $1 million. In August 1990, Harken announced losses amounting to $23 million. But two months earlier, in June 1990, Bush had offloaded his stake in the company, a classic case for investigation of insider trading rules by the U.S. Securities Exchange Commission (SEC). There was criticism that he was let off lightly by the SEC.
The oil industry contributed substantially to Bush's presidential campaign. While energy companies contributed $2.8 billion, automobile companies gave $2.3 million. Enron donated more than $1million to the Republican campaign. Interestingly, one of the first priorities of the Bush administration was the "deregulation" of energy markets.
Richard Cheney, Vice-President: Dick Cheney represents the fulcrum of the "oil factor" in the Bush administration. His handling of the levers of power at the top of the U.S. defence establishment he was Defence Secretary during the George H.W. Bush regime combined with his long tenure as CEO in an oil company have enabled him to play the key role of marrying U.S. geopolitical interests to those of the oil companies not only in West Asia but also in the Caspian basin, the world's major reservoirs of oil and gas.
One of the first actions of the Bush administration was the formulation of a new energy policy statement. Cheney was appointed Chairman of the National Energy Policy Development Group, the report of which is known as the Bush-Cheney Energy Plan. There have been allegations that corporate interests had played a crucial role in the drafting of the policy. These came out into the open in the wake of the Enron scandal in 2001. In fact, at the height of the Enron scandal, the U.S. General Accounting Office took the unprecedented step of suing the Bush administration, asking the government to provide it a list of corporate entities that provided advice to Cheney while he was formulating the plan. The National Resources Defence Council, a non-profit organisation which fought successfully at least for limited public access to the documents in U.S. courts, has documented several features of the plan that were a verbatim repetition of advice that Cheney solicited from energy companies and lobbying groups. Cheney has refused to divulge details of meetings he had with such groups in the run-up to the formulation of the plan.
Cheney is also former CEO of Halliburton, a company that drills wells, and provides a range of services to the global oil industry. In fact, Halliburton also has extensive operations as a defence contractor. Observers have pointed out that Halliburton enjoys huge advantages because such contracts are largely dependent on patronage by governments, in the U.S. as well as elsewhere. In fact, Cheney's critics have pointed out that his move to Halliburton, after his tenure as Defence Secretary in the administration of Bush Sr., and then to the post of Vice-President, has been a serious "conflict of interest". Cheney represented Wyoming in the Congress from 1978 to 1989. During this time he co-sponsored a measure to open the Arctic National Wildlife Refuge to oil drilling and voted against the Clean Water Act, which required industries to provide for public scrutiny data on their emission of toxic chemicals.
During Cheney's five-year tenure as Halliburton CEO, the company had extensive business dealings with the Iraqi government. Halliburton is said to have bypassed U.S.-imposed sanctions by investing in contracts to repair Iraq's war-damaged petroleum infrastructure through subsidiaries registered in Europe. Halliburton grew dramatically during Cheney's term as CEO. It became the top oil services company in the U.S., the fifth largest military contractor, and also the largest employer of non-unionised employees. Halliburton now does business in 130 countries and employs more than 100,000 workers worldwide. The conglomerate owns and has financial interests in the countries of the Caspian basin, the Persian Gulf and the Balkans. Cheney left Halliburton with a $34 million retirement package after George Bush chose him as his running mate in the last elections.
Condoleezza Rice, National Security Adviser: Condoleezza Rice has deep ties with the oil industry. For a decade she served on the board of Chevron. Her expertise on security matters in the countries of the former Soviet Union helped the company, which has business interests in the region. Chevron has a major interest in the Tengis oil field in Kazakhstan, which is considered to have the largest oil reserves among the countries of the Caspian basin. Chevron is also a leading investor in pipelines in the region. Prior to her appointment as Security Adviser, she declared environmental and human rights organisations as "The Enemy". She also served as a member of the National Security council during the presidency of George Bush Sr.
Spencer Abraham, Secretary of Energy: Spencer Abraham is more closely allied to the interests of the automobile industry. His role in setting automobile emission standards has drawn criticism. Abraham fought to limit fuel efficiency in Standard Utility Vehicles, widely regarded as "gas guzzlers", and led the attempts to cut spending on research in renewable energy, and reduce federal taxes on petroleum products.
Gale Norton, Secretary of Interior: Gale Norton, a lawyer for private corporate entities, is regarded as a "passionate believer in free-market environmentalism". She has a long record of having advocated the opening up of the Arctic National Wildlife Refuge in Alaska and in the Rocky Mountains for drilling by oil companies.
Donald Evans, Secretary of Commerce: Donald Evans is a former CEO and Chairman of Tom Brown Inc., which has interests in the western U.S. He was also a member of the board of Sharp Drilling, an oil industry contractor. As the Secretary of Commerce he is overseeing the National Oceans and Atmosphere Administration (NOAA), the agency charged with the task of regulating U.S. oceans and air quality.
Andrew Card, White House Chief of Staff: A former lobbyist for General Motors and the CEO of the American Automobile Manufacturers Association, Card lobbied against more stringent emission standards for vehicles.
Lawrence Lindsey, Economic Adviser to the President: He was a consultant to Enron on issues relating to natural gas.
Lewis Libby, Vice-President's Chief of Staff: Libby held substantial stocks in energy companies such as ExxonMobil, Enron and Texaco before he took up his position in the Bush administration.
Karl Rove, Political Adviser to the President: Rove held substantial stocks in companies such as Enron, Royal Dutch and BP Amoco even as the Cheney-led team was drafting the energy plan. Rove is said to have met top Enron officials when the plan was being finalised in 2001.
Zalmay Khalilzad: Khalilzad, an migr from Afghanistan, was appointed special envoy to Bush on Afghanistan after the U.S. intervention in the country. Khalilzad was an adviser for the U.S. oil company, Unocal, working thorough his employer, the Cambridge Energy Research Associates. His nomination emphasised the extent to which economic and financial interests were at stake in the U.S. military intervention in Central Asia. Khalilzad has been closely associated with efforts to get direct access to the oil and gas resources of the region, believed to be the second largest in the world after the reserves in West Asia. For Unocal, Khalilzad drew up a risk analysis report of a proposed gas pipeline from the former Soviet republic of Turkmenistan across Afghanistan and Pakistan to the Indian Ocean. He also participated in talks between Unocal and the Taliban in 1997, aimed at implementing a 1995 agreement to build the pipeline across western Afghanistan.
Fearing a controversy over Khalilzad's role as an advisor for oil companies, Bush chose not to appoint him to a Cabinet position, which would have required confirmation by the Senate. Instead, he was appointed to the National Security Council (NSC), where no such confirmation vote was required. At the NSC, Khalilzad reports to Condoleeza Rice.
George H.W. Bush, former President: The current president's father, who led the U.S. into the war against Iraq in 1991, interceded on behalf of Chevron after the war by asking the Kuwaiti government to grant the company a concession to develop oilfields in Kuwait. The company later contributed more than $500,000 to the Republican Party, for Bush Junior's election campaign. After September 11, Bush senior also attracted controversy for his involvement with the Carlyle Group, an investment bank, which was linked to the bin Laden family in Saudi Arabia. Bush Senior was an adviser to the Carlyle Group. The Carlyle Group was also involved in defence contracts in Saudi Arabia. Several prominent Republicans of yesteryear were also involved with the group. Among them is Frank C. Carlucci, Secretary of State in the Reagan administration, who was also National Security Adviser to Reagan and a former Deputy Director of the Central Intelligence Agency (CIA). Former Secretary of State James Baker and former chairman of the SEC, Arthur Levitt, were also associated with the Carlyle Group. Nicholas Brady, Treasury Secretary in Bush Senior's administration, is a director in Amerada Hess, a U.S. company that has tied up with companies belonging to the Saudi monarchy to develop oil and gas fields in Azerbaijan.