Halliburton Announces 284% Rise in War Profits; 33,000 Iraqi Firms Idle

August 14th, 2005 - by admin

Halliburton Watch & Azzaman – 2005-08-14 01:01:54

Halliburton Announces 284% Rise in War Profits

WASHINGTON (July 25, 2005) — Halliburton announced on Friday that its KBR division, responsible for carrying out Pentagon contracts, experienced a 284 percent increase in operating profits during the second quarter of this year.

The increase in profits was primarily due to the Pentagon’s payment of “award fees” for what military officials call “good” or “very good” work done by KBR in the Middle East for America’s taxpayers and the troops.

Despite the scandals that plague KBR’s military contracts, the Pentagon awarded $70 million in “award” fees to the company, along with four ratings of “excellent” and two ratings of “very good” for the troop logistics work under the Army’s LOGCAP contract.

The Pentagon has provided preferential treatment to Halliburton on a number of occasions, including the concealment from the public of critical reports by military auditors.

Audits conducted by the Pentagon’s Defense Contract Audit Agency determined that KBR had $1 billion in “questioned” expenses (i.e. expenses which military auditors consider “unreasonable”) and $442 million in “unsupported” expenses (i.e. expenses which military auditors have determined contain no receipt or any explanation on how the expenses were disbursed).
But the top Pentagon brass ignored these audits and rewarded KBR’s work anyway.

Halliburton’s earnings announcement comes on the heels of new reports showing the Iraq and Afghan wars have already cost U.S. taxpayers $314 billion and that another ten years of war will cost $700 billion.

In another coup for Halliburton, a federal judge this month decided that whistleblowers may not sue U.S. companies for fraud if payment for services was made in Iraqi, not U.S., money. Halliburton was paid over $1 billion in Iraqi oil money during the first 15 months of the occupation. The judge’s ruling means the False Claims Act cannot be used to offer large rewards to corporate insiders who reveal wrongdoing or overcharges for services. The law is considered America’s most successful deterrent against contractor fraud, but the judge’s decision will help Halliburton and other contractors avoid tough scrutiny in Iraq.

Halliburton Watch, Washington, DC. (202) 387-8030. info@HalliburtonWatch.org

33,000 Private Firms in Iraq Are Still Idle
Alyaa Qassem / Azzaman

(August 10, 2005) — The bulk of the country’s private sector firms are idle, according to the Ministry of Labor and Social Affairs.

In a statement faxed to the newspaper, the ministry said the rehabilitation of “these 33,000 companies will certainly reduce the number of jobless in Iraq.”

Under current circumstances, there is no indication that Iraq’s private sector will even regain the small contribution it made to the national economy when the former leader Saddam Hussein was in power.

The influx of cheap goods from China and Southeast Asia, power outages and insecurity have driven most of these companies out of business.

The public sector, which still dominates the economy, is still struggling and many of its major enterprises lack economies of scale to compete.

“We still face a great number of obstacles that prevent us from putting the huge number of jobless Iraqis to work,” the ministry’s statement said.

It added: “Job opportunities available are far fewer than the unemployed figures we have. This is mainly due to the fact that many factories have stopped working and we have seen no major investments.”

The ministry has revised its employment procedures and opened new offices in all provincial capitals in the country.

To lure employers to accommodate as many jobless Iraqis as possible, the ministry now offers half the monthly salaries of newly employed workers.

It said it hoped the ministry’s financial contribution to payrolls will increase job opportunities particularly for university graduates.

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