This site is dedicated to the Royal House of Saud, and to the web of corruption it has spun around corporate America. And while it has become evident, even without those secret excerpts from the official U.S. Government 9/11 Report, that the House of Saud has been instrumental in the spread of hateful Wahhabism, that is not the main theme of this web page. The purpose of this site is to open up the discussion on an even more insidious aspect of the corrupt House of Saud, that is the influence it holds within the highest levels of the U.S. Government and American corporatations. Does the term "revolving door" mean anything to you? It is the term used to describe how senior officials of our government continue to move back and forth between the corridors of power in Washington, DC, and corporate boardrooms. While this practice, in and of itself, does not necessarily promote unethical behavior, it does warrant close watching - as does a wolf in sheep's clothing. For example, how do you feel about the executives of Enron participating in top-secret (yet to be disclosed) meetings with Vice President Cheney (who, as the former CEO of Halliburton, is himself a prime example of the revolving door principal) concerning a national energy policy? Now you take this revolving door principal and add Saudi Arabian business practices - such a combination has the effect of feeding unrestrained desire for power with unfettered corruption.
To understand the danger of having the House of Saud involved in anything you have to understand the way business is done in Saudi Arabia. Remember, oil is the source of all revenue in Saudi Arabia, and the Saud family - under the cover of government ministries - controls how this wealth is divided up amongst themselves. The Saud family has become very clever in making this all appear to have an air of legitimacy. Otherwise, their greed and corruption becomes so obvious as to incite unrest among all the other tribes on the Arabian peninsular - not unlike the response starving French peasants had when Marie Antoinette supposedly stated "let them eat cake". To accomplish this, oil revenue must appear to be the asset of all Saudi citizens, managed for their welfare under the auspices of official government ministries (although you will not find any major government ministry not ran overtly or at least behind the scenes by anyone other than an Al Saud). Then the next step is to parcel out all this money - breaking it up into huge government contracts that uses a smoke and mirrors accounting sytem that would make Arthur Anderson green with envy. All this oil money has to be spread out - with enough trickle down to appease tribal leaders - with of course the House of Saud getting the lions share. Most readily apparent is that as many as 5,000 Saud princes get a stipend of about 250,000 dollars per year, with special perks like free transportation on the national airlines (Saudi Arabian Airlines). The trickle down to tribal leaders is much like it has been done for centuries. The first ruler of Saudi Arabia, Abdul Aziz used marriage (he took over 40 wives) to consolidate his power. However, it is the power of oil revenues which insures the continued loyalty of tribal leaders in Saudi Arabia today. This system also supports the oldest ally of the Saudi regime, the Wahhabis. And it is this funding of Wahhabiism, through this unique "budgetary" system that directly ties the Sauds to Islamic terrorist operations. Again, while I am not intending to go into detail about the funding for terrorism I must state the following fact: The the tribe of Saud came into power, formed the Royal Kingdom of Saudi Arabia, and remains in power today, due primarily to it's longstanding partnership with the Wahhabi sect of Islam centered in the Najd region (which includes Riyadh). It is this sect which supports all the Madrasahs around the world. It is these "Islamic schools" that serve as fertile breeding grounds for the recruitment of future terrorists. And it is where young students are brainwashed on a curriculum of hatred for Western values, in general, and Israel and the U.S. in particular. It has become apparent that large numbers of Saudi citizens are crosing the Iraqi border to take up arms against the U.S. forces there.
As bad as Saudi ties to terorism is, I am much more concerned about the insidious nature of how the Saud family conducts business, especially in how they allocate/manage government contracts and, in particular, the level of influence they have over corporate America. Because it is how Saudi government contracts are administered that you get a true idea of the breath and depth of corruption on such a grand scale that would put Enron, ImClone, and WorldCom, to shame.
I'll give one example involving the purchase of the American F-15 fighter plane. Say the Ministry of Defense and Aviation (MODA) decides to purchase F-15 fighters, with a market value of say 35 million dollars per aircraft. Well a contract is approved by MODA to purchase 75 aircraft, at say 75 million dollars each. It's easy to see that buying that many F-15s at that price creates a substantial amount of "kickback" to spread around. Of course Prince Sultan (the Minister of Defense and Aviation - MODA) gets the biggest piece of that pie, but that still leaves a lot of crumbs laying around for many other lesser princes, Saudi middlemen, and of course American business executives to scarf up. Now, I am not too concerned about how the House of Saud pillages the natural resources of their own country to feed their greed - like pigs at a slop trough. But what I am concerned about is how American corporations are affected by pandering/groveling to the House of Saud for some of the slop that falls out of that trough. My grandmother used to say that "you can't lay down with dogs without getting up with fleas". This old adage is very appropriate in describing how American business executives are in bed with the business culture of Saudi Arabia - it means they certainly have picked up a lot of fleas. Furthermore,it doesn't take much of an invetigative nose to sniff out the reek of corruption within American corporations doing business in Saudi Arabia either. Just ask to see the specifics of one of their Saudi contracts - which of course is more closely held than any national security issue - like say a national energy policy. But then talk to any American expatriate actually working on those contracts to see exactly what is being done. Just like the example of the F-15 fighter acquisition contract above, Saudi contracts are based on grossly inflating the cost to make sure more money is left over to spread around. Service contracts are another prime example. By setting up such a contract based upon high labor costs (salaries, housing , transportation, etc.), and then cutting actual operating costs to the bare minimum, it creates a myriad of kickback schemes for all that "fat" to be spread around. If the actual service to be provided by the contract gets done poorly, or not at all, it isn't a major concern. Because the main purpose of the contract, after all, was to get huge chunks of money out of the government oil revenue pot and into the hands of individuals - primarily princes of the House of Saud. One aspect of this practice is that the fate of tens of thousands of Third World laborers are held in the balance. Working under such service contracts generally mean they will go underpaid, go months unpaid at all, and mistreated by deplorable living conditions. But it is the American expatriate workers who play a big role in this corrupt business environment. For example, several huge contracts with MODA were established to improve the operational capability of the Royal Saudi Air Force. Now I won't mention the most corrupt of these - Al Yamama - because it happens to be British (needless to say this one contract alone basically kept the entire British Aerospace Corporation afloat). But I will mention a couple involving some well known American corporations, such as Boeing (and McDonnell Douglas which it now owns), Raytheon (and it's subsidiary, Hughes Arabia Limited), and TRW (through it's subsidiary of BDM/Vinnell*). Now the average annual salary per employee was about 60,000 dollars (not bad considering the average Saudi income is about 6,000 dollars). However, the annual rent in the one compound most of these employees lived, named Jadawel (one of those bombed this year), was over 100,000 dollars per unit (and Jadawel has over 400 units). It's no surprise that Jadawel is owned by members of the Royal family, but it is even more interesting to note that it includes some who hold high positions in MODA and the RSAF and who manages the actual contract. It doesn't take a rocket scientist to see that those contracted positions are worth more by just having a warm body in one of those particular villas than actually having them perform anything meaningful that may improve the operational capability of the RSAF (a topic, in itself, that is deserving of a lengthy dissertation). Furthermore those very same American corporations, through its executives and middle management have become very adept at squeezing the bottom line to get as many of the crumbs from these respective contracts as possible. Again, I am not concerned whatsoever about how greed drives the House of Saud to skim the cream off the top of their nation's wealth, but I am concerned at how this environment of corrupt business practices has infected the business ethics of corporate America immersed in it. Of even more concern is knowing that those affected executives will then use the revolving door to move into positions at highest levels of the U.S. government.
So while it may be disturbing to most Americans that the House of Saud has been directly involved in funneling money into the hands of terrorists, it is even more disturbing to me that this corrupt regime has infected the very soul of the American corporate world. Furthermore, given the revolving door principal whereby government executives move freely between the corridors of power and corporate boardrooms, is there any doubt why all Americans should be more concerned? Is there a connection between the ethics of U.S. corporations - who "cook the books" like Enron or "downsize" the workforce so jobs can be shifted to Third World nations - and the lessons they learned from doing business in Saudi Arabia?
Seems to me American corporations have taken to heart those lessons, especially how the Saudi government awards fat contracts. In Saudi Arabia contracts are driven and based upon family (with the accent being on Saud family) relations. Here in the U.S. it is driven by cultivating and using the influence gained through the revolving door system. The one main theme that runs true through both, the Saudi contract system and our revolving door system, is the pillaging of each nations wealth for the benefit and greed of a privileged few. In Saudi Arabia the pillaging is done on their oil revenue, here in the U.S. it is our public trust - our collective tax revenue. For example, one day senior government officials (including senior military officers) are determining contract awards and the next day they are now senior executives for one of those very same companies. And that cycle continues to be perpetuated in the upper echelons of our government in Washington, DC.. The question of how Halliburton just happens to obtain a sole source contract worth a billion dollars as a result of Operation Iraqi Freedom is only the tip of the iceberg.
Am I concerned about those secret 28 pages of the 9/11 report, and what they may say about the House of Saud? Of course I am, but not nearly as much as I am about those Enron meetings to determine a national energy policy. These kind of meetings - and the type of contracts being awarded to corporations for Iraqi oil and weapons* - are indicative of how deeply the ethics of our government and business leaders have been affected by having intimate dealings within the corrupt buisiness environment of Saudi Arabia.
*I add a bit more here regarding one particular American company with longstanding business dealings within Saudi Arabia, Vinnell. In 1995-96 Vinnell was bought by another American company called BDM (CEO, Phil Odeen) - which itself was owned by the Carlyle Group (made up of people like former Defense Secretary Carlucci and others). Seems that shortly after this buyout, all BDM contracts in Saudi Arabia began to be managed by Vinnell executives - long exposed to the ways and wiles of the Saudi business culture. Then around 1997 or so BDM (and its Vinnell subsidiary) was sold to TRW. Then shortly thereafter BDM completely disappeared but Vinnell was running under it's same name as strong as ever. Then within the last year or two TRW sold Vinnell to Northrop Grumman, where it exists today. Why this digression? Well in today's (Aug 8, 2003) news we learned that an American company got a huge contract to provide automatic firearms (over 34,000) to the new Iraqi Army. One may question what happened to all those weapons confiscated by coalition military forces over the last few months. Why does an American company need to be paid by American taxpayers to re-arm the Iraqi military with new firearms (and I am betting these new firearms will not be acquired at cost either)? Well the company that was "sole sourced" (meaning no lowest bidder) to perform this contract is none other than Northrop Grumman - and a contract of this nature is the forte of Vinnell. However, this sole source contract is only a pittance compared to the one granted Halliburton for running the Iraqi oil fields. Starting to make out a picture here?
And most recently, Boeing obtained a lucrative contract regarding the lease of a fleet of aircraft to serve as U.S. Air Force tankers. Seems a Department of the Air Force official may have been influenced by the offer of a highly paid Boeing executive position - which not surprisingly she took. For once it appears someone's knickers got caught in the revolving door.
Latest Updates
August 8, 2003, Site Initiated
December 1, 2003, Boeing Update
April 26, 2004, House of Saud / Bush
