This entry in "The Daily Outrage" makes you just say "Hmmm..."
The question is this: why is Haliburton charging more? There costs shouldn't be any higher given the same source and delivery method for fuel. Why is Haliburton allowed to charge more? Why wasn't there a competitive bid? Who's lame-brain idea was it to do all of this stuff on a cost-plus basis?
The answers lead directly to a single source: Vice President Dick Cheney. Given his former and current ties to Haliburton there can be no question on the how and why of this.
The average price for a gallon of gasoline in America right now is $1.57. So imagine how indignant you would be if, say, your local government was caught buying tons of the exact same gasoline for prices per gallon ranging from $2.59 (a 65% markup) to $2.95 (an 88% markup) -- from the company the mayor used to run.
Imagine this company still has the mayor on its payroll, and the mayor still owns stock in it; imagine the company won its outrageous overcharging-for-gasoline "business" in a secretive backroom deal. Why, you'd run such a mayor out of town on a rail, tarred and feathered. Or better yet, you'd bring in the police and prosecutors to take care of the lot of them.
So consider Dick Cheney's old company Halliburton.
According to research by Congressmen Henry Waxman and John Dingell, Halliburton in Iraq is overcharging, by from 65 percent to 88 percent, for gasoline.
"Numerous experts told us Halliburton's prices were 'outrageously high,' that they were potentially 'a huge ripoff' to taxpayers, and that Halliburton could be guilty of 'price gouging'," the two Congressmen wrote in the latest in a series of letters to top military and White House officials.
As of mid-September, the Congressmen recount, Halliburton had collected $304.5 million in US taxpayer cash to import 191.2 million gallons. That works out to about $1.59 per gallon -- but "this amount does not include Halliburton's 'profits', which are calculated separately. Because the Administration agreed to a 'cost-plus' contract, the government reimburses Halliburton for its costs and then provides an additional award of between 2% and 7%. When this additional award is taken into account, the cost to the taxpayer increases to between $1.62 and $1.70 per gallon."
Compare that $162.-$1.70 per gallon to what the other big player in Iraq -- the state-owned oil company SOMO -- pays to import gasoline: Consistently under $1.
"We have also confirmed from the Coalition Provisional Authority," the Congressmen write, "that SOMO buys its gasoline from the same countries as Halliburton, transports its gasoline into Iraq by truck just like Halliburton, and delivers its gasoline to the same central depots as Halliburton."
A Halliburton spokeswoman suggested to the BBC that the markup might have something to do with security. "Based upon the big picture," she said, talk of price-gouging "insults the [Halliburton] employees who are performing this dangerous mission to help bring fuel to the people of Iraq." But a letter from the American-led coalition authority also confirmed for the Congressmen that "fuel truck convoys are required to be escorted by coalition military forces regardless of ownership." Keep that in mind when the Halliburton-conjured letters-to-the-editor start appearing, as per the marching orders e-mailed from CEO David Lesar.
This is an on-going and growing scandal. The Bush Administration's controversial request for an additional $87 billion for Iraq included $2.1 billion for oil reconstruction funds. Waxman and Dingell say that includes $900 million to import petroleum. "If Halliburton's overcharging for gasoline is not halted, between $286 million and $339 million of this $900 million could be needlessly wasted," they warn.
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And in the insult-to-injury department, the Congressmen write: "Although it initially appeared that Halliburton was gouging only American taxpayers, it now seems that the company is overcharging the humanitarian Oil for Food Program and the Iraqi people as well. This significantly compounds the implications of Halliburton's actions."
Damn straight it does. It undercuts our stated national mission: Good luck getting other nations to pony up for rebuilding Iraq, when the US lets millions go missing and international charity be hijacked. A perception of corruption on this massive a scale makes it even less likely they'll ever be a rebuilding of Iraq, a "mission accomplished".
Do you feel that the price will ever go down?
Is there a chance that to bring down the price we need to lower the demand. So is it not a good idea to find new ways to have fuel?
Are you talking Iraq or the U.S.?
Here in the U.S. fuel prices would fall if demand was reduced -- Maybe. The question is how to reduce demand. Alternative fuels are the best choice, but the fastest might by efficient engines and hybrid vehicles. And you can get 50 mpg diesel engines that produce almost no particulates right now -- if you live in Europe.
Other options include using biodiesel, vegetable oil, turning coal into gas, turning old tires into gas,or using ethanol (hello farmers). All of which can be used now.
This of course does not address Iraq, where Haliburton has been (and still is) bilking us. We pay more through them than the same people will already transport the fuel into Iraq for.
Posted by: Chris on March 30, 2004 09:49 PM