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Kerry Attacks Cheney Through His Business Ties to Halliburton

September 18, 2004|T. Christian Miller and Maria L. La Ganga | Times Staff Writers

ALBUQUERQUE — Sen. John F. Kerry attacked Vice President Dick Cheney on Friday on an issue that has simmered, but so far failed to reach full boil in this year's White House race: Halliburton.

Cheney ran Houston-based Halliburton between 1995 and 2000, a time when the oil services giant had immersed itself in controversial business dealings from Iran to Nigeria to Wall Street. As vice president, he still gets money as part of his retirement package from Halliburton, even as the federal government has paid the firm billions of dollars for its work in rebuilding Iraq.

On Friday, Kerry ripped Cheney's ties in a speech that sought to make Halliburton a prime example of a series of mistakes that Democrats say the administration has committed in Iraq.

Halliburton was awarded government contracts for work in Iraq, some of them won without competitive bidding. Investigations have since turned up evidence of overcharging, waste and kickbacks involving the firm.

"Dick Cheney's old company, Halliburton, has profited from the mess in Iraq at the expense of American troops and taxpayers," Kerry said at a campaign stop in Albuquerque. "While Halliburton has been engaging in massive overcharging, wasteful practices under this no-bid contract, Dick Cheney has continued to receive compensation from his former company."

Kerry frequently has used Halliburton as an icon for abuse by corporate special interests, but Friday was the first time the Democratic presidential nominee targeted Cheney's link to it. The barrage was continuing evidence of the more aggressive posture Kerry has adopted on the campaign trail since augmenting his staff with veterans from the Clinton White House in recent weeks.

Kerry's attack on the stump was accompanied by a new television ad that began airing Friday in Oregon, where Cheney flew to campaign. It will also be shown in other battleground states. The ad criticized the money the Bush administration has spent so far in Iraq.

"Halliburton got billions in no-bid contracts in Iraq. What did we get? A $200-billion bill for Iraq. Lost jobs. Rising healthcare costs. It's time for a new direction," the ad says.

"Who is minding the store while all of this is happening? Who's in charge?" Kerry demanded in his speech.

Cheney spokeswoman Anne Womack called the Kerry charges "recycled, old attacks."

Bush campaign spokesman Steve Schmidt dismissed the charges as "baseless" and "hypocrisy," countering that a couple of Kerry's own fundraisers were lobbyists for Halliburton.

It's uncertain whether Kerry's new line of attack will damage President Bush by linking Cheney to the controversies surrounding Halliburton.

According to Halliburton's internal polling, a majority of Americans have not heard of the firm, and fewer still have made the link between it and Cheney. But the Kerry campaign has cited Democratic polling, which shows that questions about Halliburton's dealings in Iraq are of concern to many voters.

Halliburton, which had $16.3 billion in revenue in 2003, operates in more than 120 countries, usually as a subcontractor for big oil companies. The company and its subsidiaries provide a variety of services, from drilling oil wells to building refineries.

As Halliburton has been buffeted by criticism over its work in Iraq, it has become increasingly difficult to separate politics from actual wrongdoing. Democrats in Congress have tarred Halliburton -- and by extension, Cheney -- with accusations that range from bribes to obtain a multimillion-dollar oil deal in Nigeria to overcharging for cans of Coke in Iraq.

Also, more than $6 million in anti-Halliburton ads have been spent by pro-Kerry groups in battleground states.

But a Halliburton official questioned the political damage these attacks have inflicted on Bush's reelection bid.

"These are Democratic attacks against an American company to achieve a political end," said one company official, who requested anonymity. "Everybody recognizes that."

Cheney has defended himself against the criticism that his compensation package conflicts with his vice presidential duties. He signed a deferred-compensation plan with Halliburton in 1998, two years before he resigned to run for vice president.

Such plans are common for top executives. They allow highly paid employees to defer some of their income until after they retire -- when their earnings decline and their tax liability is lower. According to the White House, Cheney received $147,579 in deferred compensation in 2001, followed by $162,392 in 2002 and $178,437 last year.

As vice president, Cheney makes $203,000 a year.

Cheney also has taken out an insurance policy to ensure that he continues to receive his retirement payments even if Halliburton goes bankrupt. And he placed options for 433,000 shares of Halliburton stock he earned into a charitable trust. He disclaims management and economic interest in those shares, which will be sold at the trustee's discretion, with the after-tax proceeds going to charity.

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