Republican strategists are jubilant over a New York Times (Thursday, Aug 1) front-page story by Jeff Gerth and Richard Stevenson that effectively damps the bonfire of public suspicion over Cheney's business ethics, dousing it with a thick blanket of cautious qualifiers, clogged syntax and now-you-see-it, no-you-don't insinuation.
Connoisseurs of Gerth's prose noted familiar features: excessive length (1604 words); rambling divagation; no clear point. I say "Gerth's prose" because it is clearly unfair to blame Stevenson as the chief perp, because Gerth's stories read the same, whoever his co-author may be.
The Gerth report was eagerly anticipated as likely to add to the White House's woes. The Drudge Site heralded it breathlessly.
The story finally tottered into view, with a lead paragraph aglow with tedium: "With Washington focused on corporate responsibility, Vice President Dick Cheney's tenure as chief executive of Halliburton is under scrutiny from government investigators and his political opponents."
Already weary, the reader trudges on to the third paragraph, where a signpost informs him that the story is headed in the general direction of the circumstances of Halliburton's takeover of Dresser Industries, a Dallas-based oil services company which (not mentioned by Gerth & Co) has historic ties to the Bush clan.
The Dresser takeover by Halliburton is no secret. It happened on Cheney's watch as CEO of the latter company, and did not display any acumen, (at least in the interests of Halliburton's present stockholders) on the part of the man often considered to be the White House's keenest brain. Dresser has huge liabilities from asbestos-related lawsuits, which have threatened to drag down the merged companies. Halliburton's shares have dropped from around $50 when Cheney cashed in 2000 for around $36 million, to $13.50 today.
To put the suspicion in compact form: did Cheney maybe in concert with his hunting buddy Bill Bradford, Dresser's CEO, shaft the shareholders by suppressing the explosive news that a former Dresser subsidiary had formally alerted Dresser it might be facing hugely expanded asbestos liabilities?
It walks like a duck. Halliburton's board was due to vote on the Dresser merger/takeover in June, 1998. In May, 1998, Bradford was alerted by a letter from the CEO of Global Industrial Technologies that his company was looking to share with Dresser the burden of asbestos related liabilities.
It walks like a duck. Though asbestos suits had bankrupted such corporate titans as Johns Manville, Halliburton looked the other way on the asbestos issue and, officially at least, the deadly May letter from the CEO of Global Industrial Technologies lay quietly in Dresser's filing cabinet.
By God, it is a duck! Halliburton mumbles in a footnote in 1999 report that there is a pesky little problem to do with asbestos and Global Industrial Technologies, but "these new assertions by Global are without merit" and its "pending asbestos claims will be resolved without material effect on Halliburton's financial position or results of operations."
It's a huge duck! Unstained by any public airing of asbestos liabilities Halliburton's stock stays high, thus making Cheney's options of enormous value. In the summer of 2000 George Bush, (who has himself made millions by cashing in options while in possession of knowledge unknown to Harken's outside shareholders,) taps Cheney as his choice for veep and Cheney cashes in, clearing nearly $40 million. One year later Halliburton announces publicly that, guess what, there's been "an unexpected development" and yes, there is an asbestos problem. Halliburton's shares begin to tank.
Sorry fellas, it's not a duck at all. We thought it might have been a duck but licensed poultry experts in the form of Gerth and Stevenson cite competent authority, in the form of Steven N. Kaplan, identified as a finance prof at the University of Chicago's Graduate School of Business, to the general effect that CEOs often don't really bother themselves with tedious minutiae like asbestos risk. And anyway, Halliburton did look at the risks in the merger really, really hard. And besides, it all came out long after Cheney had gone. And in conclusion, we'll stop the story now because everyone's gone to sleep.
So now the White House can say, "Look, the deal was scrutinized by that fearsome newshound, the Pulitzer prize-winning Gerth, the hound sniffed and the hound came up with nothing."
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