Golden Parachute... or Big Fat Bribe?
Richard Cheney's $20 Million Parting Gift from Halliburton Raises Eyebrows and Ethics Questions
by Tamara Baker

Monday, August 14, 2000 -- SAINT PAUL, MINNESOTA (AmpolNS) -- In a previous life, I used to write for the world's best audio magazine, The Abso!ute Sound. Even though my tenure ended a few years back, I still am a very good friend of its founder and editor-in-chief, Harry Pearson, who has a wonderful tendency to call me just at those times when I most need to hear from him.

One of those times happened this Saturday, just as I was stepping out of the shower. There I was, naked as a jaybird and dripping all over the bedroom carpet, as old newspaperman Uncle Harry tipped me off to the following New York Times story:

Halliburton Gives Cheney $20 Million Retirement Package

Diana B. Henriques

The energy services company that Dick Cheney served for much of the last five years as chairman and chief executive has agreed to let Mr. Cheney, the Republican vice-presidential candidate, retire with a package worth an estimated $20 million, according to people who have reviewed the deal.

The board of the Halliburton Company, which is based in Dallas, approved the arrangements on July 20, five days before Gov. George W. Bush announced his selection of Mr. Cheney as his running mate.

The board's vote allowed Mr. Cheney to avoid a potentially costly aspect of his employment contract, which said he would forfeit some of his compensation if he retired before age 62 without the board's permission. This provision, known as golden handcuffs, is routinely included in executives' contracts to give them incentives to stay.

Mr. Cheney, who spent much of his life as a public official and federal employee, became a wealthy man in his years with Halliburton. He has been paid at least $12.5 million by Halliburton since he joined the company in 1995 and has received stock and options worth nearly $39 million at its current share price.

By permitting Mr. Cheney, who is 59, to treat his departure as early retirement, the directors allowed him to keep $10 million worth of stock and options he would have forfeited had he simply resigned, the company's public filings show. It was not clear whether the $10 million was part of the retirement package or in addition to it.

One of those briefed on the plan said that the board was told the package totaled about $20 million.

While not extraordinarily large by current corporate standards, Mr. Cheney's retirement package solidifies and expands his personal stake in the oil industry in general, and Halliburton in particular, while he is on the campaign trail confronting energy policy issues that will affect Halliburton's performance.

Very interesting.

By waiving the 'golden handcuffs' clause, Halliburton essentially gave Dick Cheney an extra $10 million for no easily-discernible reason.

It's not as if Cheney's tenure with Halliburton was particularly stellar and worthy of a $10 million bonus, much less a $20 million-plus one. Consider this passage from the NYT article:

The price of Halliburton stock is substantially higher than it was when Mr. Cheney took over but his tenure was not an unqualified success. The Halliburton board annually sets financial goals for the company with the understanding that executive bonuses will be withheld if the targets are not met. The company failed to meet those targets in both 1998 and 1999, although the board decided to pay Mr. Cheney and other executives bonuses anyway in 1998 because they had engineered a major merger with Dresser Industries, another oil services company. That bonus came to $1.15 million for Mr. Cheney, nearly as much as his $1.18 million salary for the year. In 1999, however, the bonus was withheld.

With all this in mind, why is Halliburton giving Cheney the extra $10 million on top of an already very generous retirement package that includes lots of stock options?

Could it be, perhaps, that this is but a different kind of 'golden handcuff', known to most folks as a bribe? Does Halliburton expect Mr. Cheney to be working for the company while he's in the White House?

I've been hearing lots of nonsense from the GOP's stalking-horse critics of the Democratic Vice-Presidential nominee about his 'dual loyalty'. Louis Farrakhan has been but the latest person whose comments have been used to cast doubt on a man who has shown unimpeachable personal conduct. One wonders if any of these critics plan to comment on Richard Cheney's 'dual loyalties', as shown by his severance package.

Or, perhaps, could it be that in the end, Dick Cheney really does have only one loyalty -- to Big Oil?