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November 19, 2004
Shoulder-rubbing can lead to back-scratching
David Lazarus traces the story of "the politically powerful Carlyle Group, which now enjoys a close relationship with the overseer of nearly $100 billion in Army funds," in today's San Francisco Chronicle.
The Carlyle Group is a secretive investment group which controls companies that profit from US defense spending and war efforts.
Lazarus notes that Francis Harvey, a resident of Los Gatos here in Silicon Valley, "received U.S. Senate approval this week to serve as Army secretary."
He goes on to report that "Harvey, 61, is former chief operating officer for a division of Westinghouse Electric, a leading defense contractor. He also serves on the boards of two Carlyle-affiliated companies, Duratek and Kuhlman Electric. Carlyle appointed Harvey to both positions."
It gets more Halliburtonesque the deeper you go. Writes Lazarus:
The Carlyle Group counts among its leaders and advisers former Defense Secretary Frank Carlucci, former Secretary of State James Baker and, until last year, former President George H.W. Bush. In a report released Thursday, the Center for Public Integrity, a nonpartisan government watchdog group, said Carlyle was the ninth-largest U.S. defense contractor between 1998 and 2003. The group said a dozen companies in which Carlyle owned a controlling interest earned more than $9.3 billion in military contracts during this period.
Harvey's appointment - made despite the concerns of legislators who worry that he may show favoritism to defense contractors with whom he has ties - may come as good news to investors in companies that have previously profited from Carlyle's midas touch. These include United Defense Industries, described by Lazarus as a "leading maker of combat vehicles (including the Bradley fighting vehicle), artillery and missile launchers" - a company whose sales mushroomed to a record $2 billion last year.
War means work for all, they say, and not everybody considers war profits to be blood money, I suppose.
Links:
Army chief has many pals by David Lazarus, San Francisco Chronicle, 19 November 2004
The Iron Triangle: Inside the Secret World of the Carlyle Group by Dan Briody (Amazon.com book page)
OnlineJournalist.org, edited by Doug Millison, "on a need-to-know basis"
dk0853
November 19, 2004 07:33 AM
