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Halliburton's Campaign and Lobbying Activity

By Jim Vallette
18 May 2005

PAC CAMPAIGN DONATIONS

Halliburton’s political donations in the 2004 federal campaign reflect its corporate imperative to put and keep Republicans in charge of Washington affairs. The company’s political action committee (PAC) has shown ongoing Republican bias. The Halliburton PAC poured $189,000 into Republican campaigns and just $18,000 into Democrat candidacies. Over the past four federal election cycles, the Halliburton PAC was sixteen times more likely to support a Republican than a Democrat.

Halliburton’s institutional allegiance to Republican politicians is further reflected in individual contributions by its board members. Over 97 percent—$343,717—of the board members’ donations went toward Republican campaigns, compared to just $9,810 for Democrats. [See chart 1, chart 2 and chart 3.]


LOBBYING EXPENSES

The Republican power sweep in the 2000 elections allowed Halliburton to pare its costs of lobbying Congress and the executive branch. Over the final years of the Clinton administration, Halliburton’s lobbying bill ran at $600,000 annually. Halliburton cut its lobbying expenses in half—to $300,000 a year from 2001 through 2003—after Bush and former chief executive officer Cheney assumed power.

But the growing number of investigations into Halliburton’s government contracts and overseas activities led to a nearly three-fold increase in lobbying expenses in 2004. Halliburton boosted its in-house lobbying program by $100,000 and hired an outside firm, Covington & Burling, for $560,000, bringing its total Washington lobbying expenses to a record $960,000.

Covington & Burling lobbied Washington on behalf of KBR’s Government Operations division, the same division being pummeled by the media, the Pentagon, and Congress for its handling of Iraq contracts. Covington & Burling handles “inquiries concerning [the] company’s construction and service contracts in Iraq,” KBR reported.

According to company filings, Halliburton lobbyists campaigned on dozens of issues in 2004, although they discussed only a select few directly with the White House. One top-priority issue for Halliburton was an Internal Revenue Service proposal to remove excise tax exemptions from mobile machinery, such as drilling rigs.

The remainder of the lobbyists’ discussions with the White House revolved around barriers, particularly sanctions, to Halliburton’s overseas business, and getting more government finance for overseas projects. Halliburton discussed the Alien Tort Claims Act, a law that holds multinational corporations accountable for their overseas activities. It also spent a great deal of money lobbying for programs that finance the company’s overseas ventures, particularly the U.S. Export-Import Bank (ExIm) and the Overseas Private Investment Corporation (OPIC). [See chart 4.]

This has paid off well—in 2004, ExIm approved two loans for projects in which Halliburton holds contracts—$400 million for a PEMEX development in Mexico, and $909 million for a liquefied natural gas project in Qatar.

Cheney’s political priorities as Halliburton’s chief executive officer, such as efforts to lift sanctions from oil-rich countries, also remain major components of the company’s current agenda. Halliburton lobbyists also fought against new proposed sanctions on companies doing business with terrorist states, a fight that Cheney himself supported in the late 1990s.


SECRECY AGENDA

Halliburton’s lobbying efforts also dovetailed with efforts by the National Petroleum Council (NPC), which the Center for Public Integrity exposed in 2004 as a front for the oil and gas industry. “The National Petroleum Council, a little-known federally chartered but privately funded advisory committee, has been an underground pipeline of political influence for the oil and gas industry in Washington for years,” reported the Center for Public Integrity researcher Kevin Bogardus.

Cheney and many Bush “Pioneers”—the club of superfundraisers in the 2000 election—crafted a December 1999 NPC report that “has become a cornerstone of today’s energy policy,” said Bogardus. Also, through the NPC, Cheney and Halliburton lobbyists tried to reduce public disclosure of energy company information held by the government. “As head of the committee, Cheney pushed hard to convince the federal government to exempt information it collected from energy companies from the Freedom of Information Act,” reported Bogardus. Cheney said at a December 15, 1999, NPC meeting: “We want to make certain that there’s no infringement with respect to proprietary information. We’re not interested in collecting individual company data and publishing anything like that.” Halliburton’s chief lobbyist, former three-star Army Corps of Engineers General Chuck Dominy, continued to raise this issue after Cheney became the country’s vice president. “Clearly, [the] Freedom of Information issues have got to be addressed, and there’s got to be absolute protection for the private sector as we go forward with this,” Dominy said at a May 2001 meeting.


OTHER ADVANTAGEOUS RELATIONSHIPS

In early 2004, facing an SEC investigation into allegedly corrupt Cheney-era payments in Nigeria, Halliburton said it hired an unnamed lawyer to conduct an internal review. Yet, a corporate crime investigator recently revealed that this “independent investigator” was in fact closely tied to the White House. He was a former SEC general counsel and Bush family lawyer, James Doty. The lead partner of Baker Botts—the law firm that helped to deliver Florida to the Bush campaign in 2000—Doty also represented Bush when he bought a share of the Texas Rangers in the late nineties. Before that, he was general counsel to the SEC at a time when the commission investigated Bush’s insider trading at Harken Oil.

In 2005, Halliburton’s KBR subsidiary invited Joe Allbaugh onto its team of advisors. It turns out, Allbaugh was an even closer Bush associate. He managed Bush’s first rise to political power in the 1994 Texas governor’s race, then worked as his chief of staff, and finally became director of the Federal Emergency Management Agency, where he remained until March 2003. In 2005, KBR hired Allbaugh and his wife, Diane, on as consultant.