August 20, 2000
The Bush Family 'Oiligarchy'
Part Four: At the Candidate's Ear
Page 1, 2
Over the past five years, Halliburton has compensated Cheney handsomely for his services.
As Halliburton’s chairman and CEO, Cheney earned a $1.3 million salary, plus bonuses that varied from zero to $2 million. [See Halliburton’s filings with the Securities and Exchange Commission.] In June, Cheney sold 100,000 shares of Halliburton stock, bringing him an additional $5.1 million. During his five-year tenure, Cheney accrued salary and stock options worth an estimated $45 million. [AP, July 26, 2000]
In addition, upon resigning from Halliburton to run with Bush in July, the 59-year-old Cheney received what amounted to a $20 million parting gift. Halliburton’s board waived a requirement that Cheney would lose many of his stock options if he left before age 62. [NYT, Aug. 12, 2000]
Under the Halliburton deal, Cheney retained 400,000 unvested stock options that will “vest” in batches over the next three years. That means their value depends on Halliburton’s stock price at the time the vested options are exercised. Unlike other holdings, unvested options cannot effectively be put in a blind trust since a trustee cannot do anything with them until after they vest, ethics expert note. In other words, Cheney will be aware that his personal wealth will rise and fall along along with Halliburton's stock prices.
If Cheney is elected vice president and becomes a key foreign policy adviser to Bush (as he would be expected to be), Cheney could advocate U.S. actions that would benefit Halliburton’s business. That, in turn, would make Cheney’s options more valuable when they vest, possibly earning him many millions of dollars in additional profits. For instance, an administration decision to lift sanctions on Iran could give Halliburton a boost in competition for lucrative pipeline construction around the Caspian Sea.
So, the unvested options are a kind of multi-million-dollar leash tethering Cheney to Halliburton’s business success, at least for the next three years.
Back to the Future
During the Democratic convention, director/actor Rob Reiner joked that the Republican idea of diversity was “two guys at the head of the ticket that are from two different oil companies.” Indeed, never before have both candidates on the same ticket come from the oil industry, a fact that has drawn some notice but little serious discussion about the potential impact on the nation’s energy, environmental and even economic policies.
While the national media shows only a desultory interest in the Bush-Cheney oil connections, almost daily there are new warnings about the worldwide peril posed by the burning of fossil fuels, the chief cause of global warming.
Scientists who recently traveled to the Arctic Ocean have come back with alarming news that much of the thick ice that has covered the North Pole for eons has turned to water. [NYT, Aug. 19, 2000] This stunning observation is only the latest evidence that global warming poses a real threat to the safety of many millions of people around the world and to the economic stability of many millions more.
Still, the oil industry and its backers continue to insist that global warming is largely a myth, an exaggeration by environmental extremists. This argument -- mocking the environmental movement -- is funded by many of the same economic interests that have invested in the political ambitions of the Bush family for the past 50 years.
Whatever the dangers from global warming and other environmental problems, it is certainly at the heart of the oil industry’s interests for the world to remain dependent on internal-combustion engines and reliant on oil production. The oil industry is a pillar of the Old Economy whose interests are threatened by technological advances that could make electric cars and solar energy more competitive.
Given these ties that bind -- between the Bush-Cheney ticket and the oil industry -- global warming and other environmental concerns do not seem likely to rise to the top of the national agenda in a Bush-Cheney administration. The oil industry would be confident that it had staunch allies in the White House, people who not only understand the industry’s needs but who feel its pain.
This relationship also would not be a passing fling. It is rooted in a half century of deep-and-abiding connections and mutual dependencies between the Bush family and the oil industry.
These are entangling alliances that the U.S. public only vaguely discerns. In the smog of Sunbelt cities, in the smelly haze of gasoline refineries, in the smoky burn-off of oil wells in the Third World and the Middle East, there stands a Bush family “oiligarchy.”
End of Series