This is what happens
Take a large multi-national corporation. Abuse it, make it the focal point of illogical political attacks. Subject its every move, every action to public scrutiny, ridicule, abuse, and scorn, regardless of whether or not it is warranted. Make it a political hot potato, abuse its friends, defenders, allies, officers, managers, and even employees. Create a regulatory environment so bad, it can't make money in its home area. Tolerate people becoming so unhinged that their reactions to a person is to pillory them as the fourth coming of Adolf Hitler just for mentioning that they work there. (Everyone knows that Bush and Cheney are the second and third comings of Herr Hitler.)
What do you get?
A middle finger and a great big "So long!" Don't kid yourselves people. That's what Halliburton just gave the good ol' U.S. and the city of Houston. They're moving, and it's not just a minor administrative matter; they're moving the world headquarters and the CEO, president, and chairman of the company to Dubai.
In a stunning piece of news, the company said the new headquarters in Dubai will help Halliburton strengthen its presence in the Middle East, Asia and Europe, where it's business is growing. But it casts doubt on the future of the company's current headquarters in Houston.
Demoting Houston's facility from "World Headquarters" to "Hemispheric Headquarters" is the best we can hope for. And that's going to mean the loss of jobs and tax revenue to the Houston/Harris County/Montgomery County areas.
"The Eastern Hemisphere is a market that is more heavily weighted toward oil exploration and production opportunities and growing our business here will bring more balance to Halliburton's overall portfolio," [CEO David] Lesar said today at a regional conference in the Kingdom of Bahrain.
This is how bad it is folks. The announcement wasn't even made at the headquarters or even in the U.S. It was made, by the CEO, in the country where they're going to relocate. Let me translate a few of those words: "More heavily weighted toward oil exploration and production opportunities" means, "doesn't have a regulatory environment that makes it impossible to do anything." It's been 50 years since we built a new refinery from scratch in the U.S. Even the disruptions caused by twin hurricanes 2 years ago hasn't changed that.
From ABC News:
Lesar's announcement appears to signal one of the highest-profile moves by a U.S. corporate leader to Dubai, an Arab boomtown where free-market capitalism has been paired with some of the world's most liberal tax, investment and residency laws.
In a city where the mayor just got slapped down by his neighbors for regulatory overreach, maybe there's a lesson to be learned there. So, what's the reaction? Typical Halliburton-bashing in the press, and in Congress:
The military contractor accused of wasting taxpayer money on no-bid contracts in Iraq is moving its HQ. "They'll be avoiding U.S. taxes," Sen. Patrick Leahy, D-N.H., says. "I'm sure they won't stop insisting on taking their profits in cold hard U.S. cash." Federal investigators last month alleged Halliburton was responsible for $2.7 billion of the $10 billion in contractor waste and overcharging in Iraq.
Like the federal government would have done a better job, right? (Just for the record, the problem is with KBR, which Halliburton is selling off, as it has been nothing but political and public-relations trouble). Let's be clear, Senator. No, they won't be taking their profits in cold hard U.S. cash, they'll be taking them in the currency of Bahrain. They'll be operating in a country where business is king, where people like yourself don't make absurd populist statements that have no basis in logic or reality, and where every politically-ambitious mayor doesn't try to impose regulations beyond his legal authority.
And we will be that much poorer.
Posted by Ubu Roi @ 03/11/07 05:24 PM | Print |
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