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to have close ties to federal, state, and local government officials, and to have overcharged
the government for their services. Some of the companies had hired lobbyist Joe Allbaugh,
the former FEMA director, allegedly to help them secure such deals.
Particularly contentious were contracts worth a half a billion dollars that went to
Halliburton, the multinational energy services and construction conglomerate. These
contracts attracted special attention because, at the time, Halliburton was under
investigation for overcharging the Defense Department for services provided in Iraq as
part of a two-year, no-bid contract worth up to $7 billion; the contract had initially been
crafted to cope with expected oil-well fires after the U.S. invasion of that country.15 Vice
President Dick Cheney had previously served as head of Halliburton, making the
administration’s critics especially skeptical of such exclusive deals.
Defenders of the Iraq contract cited national security concerns and a need for secrecy.
They also argued that Halliburton was the only company in the United States with the
capacity to fulfill the terms of the contract. Bob Grace, president of Texas-based GSM
Consulting, which the government of Kuwait had hired to put out over 300 oil-well fires
after the 1991 Persian Gulf War, has challenged both of those arguments.16 Grace cited
his company’s previous achievements, and on the issue of national security, he said that
“secrecy about [former Iraqi President] Saddam Hussein blowing up oil wells, to me, is
stupid.…I mean the guy’s blown up a thousand of them. So why would that be a revelation
to anybody?”17 The secrecy argument also seemed to contradict the Bush administration’s
stated efforts to present Hussein with a credible threat of invasion as it tried to force him
to comply with international weapons inspectors; the public award of a major contract for
post-invasion recovery work would have plausibly augmented any such threat. Moreover,
an open bidding process would likely have lowered the price, even if in the end the
administration intended to choose Halliburton as the most qualified bidder.
In addition to hiring unqualified supporters and awarding contracts to favored companies,
U.S. leaders have been accused of cronyism for abusing the power of pardon. For example,
after the 2000 presidential and congressional elections, when he could no longer be held
politically accountable for the decision, outgoing President Bill Clinton pardoned fugitive
financier Marc Rich, who had been indicted in federal court for tax evasion and 51 counts
of tax fraud. Rich’s ex-wife, Denise Rich, had recently donated approximately $1 million to
the Democratic National Committee, giving the pardon the appearance of impropriety. In
contrast, President Gerald Ford’s controversial 1974 pardon of disgraced former president
Richard Nixon came just before that year’s midterm elections, allowing voters to hold
Ford’s party responsible for his actions.

Corruption and Campaign Finance Reform

Even before the first U.S. congressional elections, political campaigns were recognized as
opportunities for corruption. James Madison, for instance, complained that he lost his
1777 bid for a seat in the Virginia legislature because he refused to provide voters with
alcohol on election day, as they had come to expect. Prior to the adoption of the
Australian-style secret ballot in the late nineteenth century, votes were frequently
purchased and voter intimidation was not uncommon. Moreover, until the direct election of

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