Morning Report 8/29/05
Pentagon Fights a Major Storm

To limit damage, a key whistleblower in Halliburton scandal is demoted

U.S. Army Corps of Engineers

Contracts are out on Bunny Greenhouse, shown here at a Corps of Engineers conference while she was the top official overseeing deals

Not as deadly as Hurricane Katrina promises to be, Whistleblower Bunny represents a threat to only two structures — three, if you count Halliburton's headquarters.

But that's why the Pentagon and White House have urgently demoted the top U.S. Army Corps of Engineers contract overseer, Bunnatine H. "Bunny" Greenhouse.

The veteran official, fed up with her inability to call attention to cronyism that led to a five-year, $7 billion Iraq oil-repair contract to Kellogg Brown & Root, the subsidiary of Dick Cheney's Halliburton, ignored her bosses' warnings and testified before a powerless Senate Democrats-only panel in June that the sweetheart deal was "the most blatant and improper contract abuse I have witnessed during the course of my professional career."

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Greenhouse is one of the highest-ranking and most potentially damaging whistleblowers about the Bush regime's bidness practices. She's been the focus of stories like Michael Shnayerson's "Spoils of War" in the April 2005 Vanity Fair. If there is ever a real investigation, she'll be a household name. After her strenuous objections to cronyism were ignored, she was forced to go public. Obviously in reprisal, Pentagon officials demoted her. The New York Times reports it this morning, but a better story on the outrageous action can be found at Halliburton Watch.

Greenhouse's effect has been to spur investigations by the Justice Department, the FBI, and the Pentagon's inspector general, Halliburton Watch notes. Nevertheless, while those probes supposedly continue, Greenhouse has been bounced from her executive post.

She showed courage back in 2002 and 2003, while the charges of cronyism were being directly denied by the White House and Pentagon. Later, of course, the liars came clean — partially.

In June 2004, the Pentagon finally admitted that the first sweetheart Halliburton deal for the war was awarded on the recommendation of aptly named political appointee Michael Mobbs, an assistant to Undersecretary of Defense Doug Feith, a chief neocon schnorrer. Feith was in charge of post-war planning.

Mobbs, a former associate in Feith's law firm that serviced defense contractors before the neocons came to power, was placed in charge of half of Iraq's ministries. He was also a fixer on the pre-invasion issue of how to mistreat "enemy combatants."

His role in the Hamdi case back in August 2002 produced a frighteningly hilarious episode in federal court. District Judge Robert Doumar grilled the government on its reasons for holding Yaser Esam Hamdi incommunicado in a Navy brig. As the Washington Post wrote at the time:

    The government has declared Hamdi an "unlawful enemy combatant," entitled to neither constitutional protections nor international prisoner-of-war status.

And the government provided a two-page "declaration of facts" by Mobbs about how the Pentagon determined that Hamdi was an "enemy combatant." The judge questioned the government's attempt to ignore due process:

    "I have no desire to have an enemy combatant get out of any status. However, I do think that due process requires something other than a basic assertion by someone named Mobbs that they have looked at some papers and therefore they have determined he should be held incommunicado. Just think of the impact of that. Is that what we're fighting for?"

No, judge, we're fighting to liberate Halliburton. Dogged work by Congressman Henry Waxman has helped uncover that rock. Waxman's June 13, 2004, letter to Cheney about the Mobbsed-up contract with Halliburton is a classic, a must-read for anyone who wants to understand the bidness scandal surrounding our unjustified invasion of Iraq.

As Halliburton Watch said at the time:

    During the Summer of 2002, Mobbs was in charge of the Pentagon's Energy Infrastructure Planning Group to develop a plan for reconstructing Iraq's oil industry. By the Fall of 2002, Mobbs had decided that three companies could carry out the oil fire contract: Halliburton, Bechtel Group and Fluor Corp.

    Contracting experts say it is highly unusual for a political appointee, rather than career civil servants, to designate which companies will compete for a government contract. "The suggestion that political appointees would be directing that type of investigation does not seem consistent with maintaining the appearance of propriety," contracting expert Steven L. Schooner told the Los Angeles Times.

    In 2002, an Army lawyer objected to the oil fire contract on grounds that it would be awarded to Halliburton under the company's Army supply contract, which is not authorized to govern firefighting issues. Mobbs overruled the lawyer and the contract was later awarded to Halliburton under the Army supply contract. But the auditing arm of Congress, the General Accounting Office, will release a report this week concluding that the firefighting contract was indeed improperly awarded to Halliburton because it was not awarded as a separate contract from the company's already-existing Army supply contract.

    "Rumsfeld's political lawyers steamrollered the career guys to push through Halliburton's secret deal," law professor Charles Tiefer told the Times. "It creates a disturbing appearance of influence when Cheney's lawyers are told several times Halliburton is getting special deals, and they never say, 'Make sure the career people agree this is being done right.'"

This past June, Waxman rounded up examples of the preferential treatment of Halliburton — including the Mobbs and Greenhouse incidents. Of Greenhouse's work, the roundup notes:

    Despite strenuous objections from the chief contracting official at the Army Corps of Engineers, the Defense Department secretly awarded Halliburton a five-year, no-bid contract to repair Iraq's oil infrastructure in March 2003. Bunnatine H. Greenhouse served as the Principal Assistant Responsible for Contracting (PARC) with the Army Corps of Engineers. Ms. Greenhouse objected for several reasons to the award to Halliburton of the RIO contract, which was worth up to $7 billion.

It didn't take Halliburton, which still pays Cheney, much time to run up a tab. In December 2003, the government found that it had overcharged taxpayers $61 million for importing gasoline from Kuwait to Iraq. The next month, however, the Pentagon ignored its own auditors and gave Halliburton yet another huge contract.

Will there ever be a real investigation? Not as long as the GOP controls Congress.

And not as long as ass-kissing officials in agencies like the Corps of Engineers keep demoting whistleblowers to please the Pentagon and White House bosses.

Greenhouse warnings just don't go over too well with this White House.

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