Tuesday, June 09, 2009
Despite allegations of bribery, despite accounts of over-charging the government, despite reports of faulty work endangering the lives of American soldiers, the companies of Halliburton and its one-time subsidiary KBR are doing better than ever. When the Bush administration gave the green light to invade Iraq in 2003, Halliburton was rewarded with billion-dollar contracts through KBR to provide logistical support for the U.S. military, performing tasks that ranged from feeding the troops to building their shelters. But once numerous controversies surfaced involving KBR, Halliburton cut the company loose, and officially ended their longtime relationship in 2007.
Today, neither Halliburton nor KBR are suffering from their divorce. Halliburton reported $4 billion in operating profits in 2008, while KBR recently said its first quarter revenues in 2009 were up 27%, for a total of $3.2 billion. Its sales in 2008 were up 33%, and according to the Financial Times, the company had $1 billion in cash, no debt, and was looking for acquisitions.
So far no amount of bad news has hurt KBR’s business. Last month, a Defense Department investigator told the Commission on Wartime Contracting in Iraq and Afghanistan that the “vast majority” of cases involving over-billing, bribery, and other possible violations by contractors in Iraq were linked to KBR. Also, Pentagon auditors balked at paying KBR $100 million for private security that the government contract specifically prohibited. And the company has been accused of installing faulty wiring at military bases that has resulted in numerous soldiers being electrocuted, leading to four deaths.
But this may be the topper. KBR is currently rebuilding a dining hall at Camp Delta in Iraq—even though: A) The company just finished remodeling it; and B) The military will be pulling out of the base within two years.
-Noel Brinkerhoff
Is Halliburton Forgiven and Forgotten?: Or How to Stay Out of Sight While Profiting From the War in Iraq (TomDispatch)
$30 Million Wasted on Building Project in Iraq Symbolizes Inefficient Spending (by Richard Lardner, Associated Press)
Comments