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As published in The Washington Post on March 3, 2004.
PILING ON HALLIBURTON
THE WASHINGTON POST
By: DAVE LESAR – Groucho Marx once said that "politics is the art of looking for trouble, finding it everywhere, diagnosing it incorrectly and applying the wrong remedies." That may overstate the case some, but right now Groucho looks less like a comic and more like a political analyst.
Compliance with government contracting is a daunting task replete with potential points for differing interpretation. Halliburton has been working with the military since World War II and understands the process as well as anyone. In the best of circumstances, auditors are going to ask very specific questions and companies are going to respond with answers to those questions. The two sides do not always agree, but the process ensures that everyone understands both the questions and the answers. We have always worked with the auditors and we will continue to work with them. At times we have disagreed on issues that were subject to audit, but we have always been able to work through these issues. The process normally works well because it balances the government's need to deliver products and services at the best value and the company's need to be fairly paid for its work.
In the 2004 campaign season, Halliburton apparently is no longer entitled to answer questions before being accused of mismanagement, profiteering or misuse of funds. Halliburton is under the most intense public scrutiny of any corporation in America today. The primary reason for the attacks on our integrity seems to be that the vice president of the United States used to hold my job. Some of these critics are not content to rage about the Iraq war. They are intent on creating a new and continuing war against Halliburton, even ignoring the truth about our work supporting the troops in Iraq and around the world.
Examples include a very public charge of "war profiteering" on fuels shipped into Iraq from Kuwait. Missing in the first headlines, and generally unreported since, is the fact that the contracts were approved by our client, the U.S. Army Corps of Engineers. Meanwhile, Halliburton actually suggested that Turkey be used as an alternative fuel source, a recommendation that saved millions in taxpayer dollars. Numerous investigations have been launched following the media reports. We are confident that it will be proven that Halliburton delivered the fuel at the best price on the best terms, even under emergency wartime conditions.
Another report addressed the possibility that two former Halliburton employees received kickbacks from a Kuwaiti contractor. Missing from the debate on that subject is the fact that the activities of one or two rogue employees were caught by Halliburton internal auditors. As a result, taxpayers didn't lose a penny.
Recently two other former employees said that Halliburton has engaged in a variety of overcharging practices that are costing the taxpayers millions of dollars. If the goal of their statements and news events was anything more than political grandstanding, we could have again demonstrated why the "facts" they used to make these claims were wrong -- not just misinterpreted, but wrong.
One phone call to Halliburton would have eliminated their incorrect statement that we bought monogrammed towels in Iraq for $7.50 each. Some monogrammed towels were used at one site to limit the disappearance of towels. They cost $3 each. In another claim, critics say Halliburton paid $7,500 per month for lease vehicles. Our records indicate no such lease payment for any one vehicle. Indeed, every example cited in their public statement has a logical factual explanation or can be refuted outright. So please, in the future, make that call to us.
We support aggressive government oversight, and our approach is to not pick fights with elected officials. We have served both Democratic and Republican administrations for more than 60 years. We are proud of our record and of our employees who serve the military. We receive contracts to make omelets and build infrastructure because of our unique skill sets. In short, we get government contracts because of what we know, not who we know.
When we are operating in a war zone under intense time pressures we will of course make some mistakes. But our commitment at Halliburton is that when we make a mistake, we say so and we fix it. Our hope is that we take politics out of the equation. I can assure you, however, that regardless of how political the field becomes, Halliburton will continue to deliver what our soldiers need to feel a little closer to home.
The writer is chairman and CEO of Halliburton Co.
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