Halliburton’s Boomerang

Vice President Dick Cheney has displayed a remarkably thick skin about his coziness with the energy industry, even going to court rather than allow Congress to find out who was at his energy commission meetings in 2001 and what was discussed.

That the issue was so hard-fought testified to public suspicions about the energy industry connections of both President Bush and Cheney.

Even more discomfiting was the belief that Halliburton, the giant energy and construction company that Cheney headed before he was vice president, had the inside track for a $600-million contract from the U.S. Agency for International Development for reconstructing Iraq. Halliburton, among other things, has been an oil field services firm for decades in the Middle East. It seemed poised to rake in profits from Iraq reconstruction projects that might total billions of dollars.

It was bad enough that the world saw the contracts as skewed toward U.S. companies and even worse that a White House crony seemed to have it fixed. That perception appeared to boomerang Friday when USAID confirmed that Halliburton was not a finalist.

On Monday, Halliburton said it had never submitted a bid, though it had been widely reported as working with the California-based Parsons Group to prepare one.

The State Department Foreign Service officers who select winning bids are supposed to remain clear of any hint of political influence. This is not to say political connections have no benefit. But had Halliburton or, more specifically, its subsidiary Kellogg, Brown & Root, been picked, it would have been compromised in the public eye. Even if Halliburton was the best company for rebuilding Iraq’s bridges and electric power stations, it had become impossible to disentangle the company’s political connections from its qualifications.

Politicos who take high-level corporate jobs are not hired for their MBA degrees. Bechtel Group, which reportedly is one of the two Iraq finalists, was once headed by former Reagan Secretary of State George P. Shultz, and former Secretary of Defense Caspar W. Weinberger worked for it as well. But Cheney is so influential now that Halliburton may have gotten too hot to touch.

Halliburton can still compete for other Iraq business, both as bidder and subcontractor, and Kellogg, Brown & Root was awarded a no-bid Army Corps of Engineers contract March 9 to put out oil well fires.

The Bush administration has been a sturdy friend to business, inviting corporate opinion on tax policy and environmental decisions alike. That’s a matter of political philosophy. What can more easily come back to bite with voters is the perception that a particular business has too big an inside edge.