The trade pact with Colombia was approved by Congress and President Obama signed off on it. The pact benefited US businesses trying to sell products in Colombia and also boosted Colombian exports to the United States. The Colombian government and business community has hailed it as an important victory for the Colombian people.
In February 2012 Bill and Giustra were back in Colombia together for meetings and some golf. Bill was playing in a golf tournament (the Pacific Rubiales Open, no less), which was a fundraiser for the Clinton Foundation. Bill met with President Juan Manuel Santos.
Since then, Giustra’s interests in Colombia have run into trouble. For instance, the manner in which energy concessions were handed out has come under fire. There have been media claims of a “juicy concession” for Giustra from the Colombian government obtained with the help of Bill Clinton.54 Colombian senator Jorge Enrique Robledo claimed the Uribe government showed favoritism to Pacific Rubiales during the process of granting Colombian oil concessions.55
Pacific Rubiales has been the subject of repeated complaints about “deplorable conditions” for workers. The complaints included “contracts, work hours, pay, democratic guarantees, housing, hygiene, transportation and the right to organize.” When leaders from the country’s petroleum workers union Unión Sindical Obrera (USO) tried to mediate, Pacific Rubiales reportedly blocked the public highways in the region to prevent them from arriving.56
Another of Giustra’s companies, Prima Colombia Hardwood, has also run into problems. In May 2011 the Ministry of Environment began monitoring the logging being done by Prima Colombia. According to published reports, the company needed to answer for ten environmental violations, including erosion of the natural wildlife habitat, shifting water currents in the area, and the alteration of the vegetation cover. The National Environment Licensing Authority (ANIA) subsequently decided to deny all environmental permits required by Prima Colombia.57
CHAPTER 10
Disaster Capitalism Clinton-Style
THE 2010 HAITIAN RELIEF EFFORT
On the afternoon of January 12, 2010, a devastating 7.0 earthquake shook the island nation of Haiti. In less than a minute, the violent tremors leveled an estimated 25,000 government and commercial buildings, more than 100,000 homes, and killed approximately 230,000 people.
When the earth stopped quaking, more than 1.5 million people were left living in makeshift tent camps. “In 30 seconds, Haiti lost 60 percent of its GDP,” said Haitian prime minister Jean-Max Bellerive. For a country whose history was plagued with natural disasters, corrupt leaders, and abject poverty, it must have seemed like the exclamation point on some sort of cruel natural joke.
The international charitable response from groups like the Salvation Army and the Red Cross was generous, as millions of people around the world wrote checks or donated via their cell phones. Foreign governments committed funds, too.
Days after the earthquake, Hillary Clinton was en route to Port-au-Prince to inspect the damage. To accommodate her, all flights to and from the island were halted for three hours. Hillary arrived on a Coast Guard C-130, along with American relief workers and a supply of toothpaste, mustard, and cigarettes her staff had purchased from US supermarkets the night before. She did not leave the airport, to avoid impeding rescue efforts, but declared her deep sympathy for the people of Haiti and offered assurances that America would be Haiti’s “friend, partner, and supporter,” with the State Department and USAID taking a front and center role in the relief effort.
Bill Clinton was soon on the ground in Haiti, too. He had been appointed a United Nations special envoy to the island in 2009 and traveled to Haiti regularly. With a cluster of cameras around him, Bill teared up as he described what he saw.
The Clintons’ close friend and confidante, Cheryl Mills, who was Hillary’s chief of staff and counselor at the State Department, was assigned responsibility for how the taxpayer money, directed through USAID, would be spent.1 Within days, the State Department conceived and created a funnel that would direct the aid and relief money that would soon flood into the country. The Interim Haiti Recovery Commission (IHRC) was given the task of executing an action plan developed with the help of Haitian authorities and countries that were donating funds to the rebuilding effort. It was supposed to prioritize the rebuilding of Port-au-Prince, with a focus on restoring the economy and government services.2
Bill was promptly appointed cochair, along with Bellerive. Together, they constituted IHRC’s Executive Committee, giving them concentrated decision-making power. In this role Bill was ultimately responsible for the approval of any projects that would be funded by US taxpayer dollars or international organizations. Clinton and Bellerive would prove to work effectively together. As we will see, Bellerive would later go into business with members of the Clinton family in Haiti.
In public statements, Bill waxed romantic about how they would rebuild Haiti, like a phoenix from the ashes, in a grand vision of social engineering. “I want them to close their landfills,” he told Esquire magazine, “recycle everything and use the rest for energy. Wouldn’t it be great if they become the first wireless nation in the world? They could, I’m telling you, they really could.”3
It is hard to underestimate the role that IHRC would play in the disbursement of funds. As the State Department itself noted, in addition to reviewing project applications and deciding if those projects would be funded, “IHRC is the planning body for the Haitian recovery.” In particular, as the US Government Accountability Office (GAO) put it, IHRC was supposed to “coordinate donors, conduct strategic planning, approve reconstruction projects, and provide accountability.”4
With the massive expenditure of US taxpayer money, some things have improved in Haiti. Some roads are considerably better than they were before. A large amount of debris has been removed. But beyond that, by the measure of promises made by the Clintons, the efforts to rebuild Haiti, which were largely controlled by Bill and Hillary Clinton, have been a massive failure.
Five years after the earthquake, Haiti is not a “wireless nation.” Billions of dollars have indeed been poured into the country, with Hillary and Bill having much of the say in how the funds were allocated. But according to GAO, IHRC ignored the action plan and funding priorities that had been set up by the Haitian government and donor countries.5 Moreover, much of the taxpayer money intended for practical rebuilding was squandered.6 Funds for reconstruction have ended up in worthless projects—while in several cases Clinton friends, allies, and even family members have benefited from the reconstruction circumstances.
Natural disasters often create enormous opportunities for politically connected contractors to make money courtesy of the rebuilding effort. Author and critic Naomi Klein calls it “disaster capitalism.”
Disaster capitalism need not be all bad. You do need qualified professionals to go into devastated areas and begin the process of providing immediate relief and rebuilding infrastructure. An example of where such efforts went well was in Indonesia, following the tsunami that devastated the region in 2004. Communities that were cut off from the rest of the country saw their services and infrastructure restored, and crime and corruption were generally kept under control, according to the World Bank.7
In the case of Haiti, the process was handled very differently. IHRC, for example, was supposed to have a Performance and Anticorruption Office (PAO) to monitor reconstruction efforts and investigate allegations of corruption. But it was eleven months before a single employee was even hired as part of PAO.8 What’s more, IHRC was never fully staffed, and much of the decision making was left in the hands of key employees of the Clinton Foundation.9
Less than a month after the earthquake hit, US ambassador Kenneth Merten sent a cable from Port-au-Prince to State Department headquarters titled “THE GOLD RUSH IS ON.”10 A flood of eager businessmen were rushing to the capital looking to obtain government contracts. But securing contracts and business apparently required knowing the right people. Put
simply, it was widely believed you needed access to the Clintons.
Florida-based contractor J. R. Bergeron was one of several business owners jockeying to land lucrative contracts to help with disaster cleanup. To compete for cash in what Bergeron called “the Super Bowl of disasters,” he understood the Clintons to be the referees.11 His company, Bergeron Emergency Services, invested more than a million dollars to move employees and equipment to Haiti even before landing a contract. But Bergeron knew he would have to do more than just demonstrate expertise and readiness. As he later observed, “posturing and aggressive self-promotion in Haiti was an inevitable part of this high-stakes competition. . . . Politics plays a large role.”12
Bergeron hired two lobbyists, giving them the job of “reaching out to officials of the Clinton Foundation’s Haiti earthquake relief efforts and the U.S. Agency for International Development.”13 They were Mitch Berger and Alex Heckler; Heckler had served on Hillary’s national campaign finance committee. Bergeron also says he made a donation to the Clinton Foundation. (Records indicate he gave less than $250.) He failed to obtain any contracts.
The realities seemed clear. As one individual told the Wall Street Journal, “if you don’t have Clinton connections you won’t be in the game.”14
But those with impeccable Clinton credentials apparently didn’t need to hire lobbyists.
Merten’s cable specifically mentioned the arrival of longtime Clinton friend and confidant General Wesley Clark in the weeks after the earthquake.15 Like Bill, Clark was from Arkansas and had been NATO commander during Bill’s presidency. Indeed, Clark had been one of Clintons’ favorite generals and received several military promotions when Bill was in the White House. As the New Yorker points out, Clark’s last three army jobs, including two at the highest rank, were awarded to him without the army’s recommendation.16
When Clark sought the Democratic nomination for president in 2004, Bill strongly backed his candidacy. When Hillary ran for president in 2008, Clark raised money for her campaign. Clark also serves on an advisory board of the Clinton Global Initiative (CGI). Much later, in 2013, he signed the first fundraising letter for a superpac backing a 2016 Hillary presidential bid.17
According to Merten’s cable, Clark quickly scored a meeting with Haitian president René Préval.18
Clark had come to Port-au-Prince in search of a home-building contract for a south Florida company called Innovida, a manufacturer of building materials. (Clark sat on the board of the company along with former Florida governor Jeb Bush.) Clark was a big cheerleader for the company. “It can do more for housing in Haiti, better and faster, than any other technology out there,” he said. Innovida’s ties to the Clintons ran even deeper than Clark. According to the South Florida Business Journal, Innovida’s CEO Claudio Osorio was a “big fundraiser” for the Hillary 2008 campaign and had contributed to CGI.19
Innovida had little track record of actually building homes. Yet the company saw its project fast-tracked by the Haitian government and the State Department.20 Innovida received a $10 million loan from the US government to build five hundred houses in Haiti.
Sadly, the houses were never built. In 2012 Osorio was indicted and convicted of financial fraud. Prosecutors would later accuse Osorio, who drove a Maserati and lived in a Miami Beach mansion, of using the money intended for relief victims to “repay investors and for his and his co-conspirators personal benefit and to further the fraud scheme.”21 He was ultimately sentenced to twelve years in jail. Innovida collapsed.
It is hard to overstate the power the Clintons wielded in the disbursement of US taxpayer money for Haitian relief. Esquire magazine called Bill the “CEO of a leaderless nation,” because of his role as the cochair of IHRC.22 The Miami Herald repeatedly referred to Bill as the “co-czar of the recovery effort.”23 Others called him “president of Haiti” or “viceroy” because of his powers. Hillary, as secretary of state, had ultimate control over the dispersement of US taxpayer aid dollars.24
Many Haitians believed the Clintons further demonstrated their power in Haiti when Garry Conille became prime minister in October 2011. Conille had worked for Bill as a speechwriter and as his UN special envoy chief of staff.25 Conille’s appointment was seen as a compromise, and the fact that he was backed by Bill Clinton was touted by some Haitians as one of the reasons for his selection.26
What happened in Haiti was the classic Clinton Blur, mixing philanthropy, politics, and business.
Bill arrived in Port-au-Prince wearing several hats and pursuing myriad agendas, both public and private. As the Economist succinctly noted,
The strange multi-dimensional role that Mr. Clinton plays as co-chair of the IHRC, special UN envoy, former US president, spouse of the US secretary of state, and head of his own foundation which supports projects in the country, will continue to lead to confusion about who he advocates for and to whom he ultimately answers.27
Pushback from within IHRC came almost immediately. In October 2010 Jean-Marie Bourjolly, a member of IHRC, wrote a memorandum to the cochairs and the other commission members cautioning that by “vesting all powers and authority of the Board in the Executive Committee [Clinton and Bellerive], it is clear that what is expected of us [the rest of IHRC] is to act as a rubber-stamping body.”28 Bourjolly’s concerns were not appreciated. Indeed, his memorandum was not included in the official minutes of the October IHRC meeting.
Other commission members and employees confirmed that Bill and Hillary got what they wanted when it came to Haiti projects and contracts. As one employee noted, projects were approved because “they were submitted by USAID and State.” Moreover, “as long as USAID is submitting it and USAID is paying for it, they would be approved.”29
In December 2010 nine of the fourteen Haitian IHRC members wrote an official complaint to Clinton and Bellerive; they felt “completely disconnected from the activities of the IHRC.” IHRC was moving forward on projects that didn’t seem to conform to the action plan that the Haitian government and donor nations had agreed to in the months following the tragedy. The members warned that “we risk ending up with a variety of ill-assorted projects, some of which are certainly interesting and useful taken individually, but which collectively can neither meet the urgency nor lay the foundation for the rehabilitation of Haiti, and even less its development.”30
The GAO echoed those concerns, noting in May 2011, “funding for approved projects is uneven across sectors and is not necessarily aligned with Haitian priorities.”
Bill’s role as unofficial “viceroy” raised questions in the Haitian community because of the Clintons’ penchant for mixing politics with crony business arrangements in Haiti. Back when Bill had been appointed special envoy for the United Nations in 2009, the Haiti Observateur challenged both Clintons to “come clean about [Bill’s] relationship to the former Haitian president and he and his wife’s business dealings in Haiti.”31
“There have been whispers and rumors for quite a while about the Clintons’ choice connections to the former president and particularly the telephone business in Haiti,” the paper said.
As president in 1994, Bill Clinton had sent troops to Haiti to return to power Jean-Bertrand Aristide, the duly elected president who had been forced out in a 1991 coup. While president, after he was restored to power, a special deal was granted to a small US-based company called Fusion Communications. (The prime minister of Haiti at the time was Aristide friend and ally René Préval, who was president at the time of the earthquake.) The Haitian government–owned telecom company, Teleco, granted Fusion long-distance minutes from the United States to Haiti at a deeply discounted price. With a large number of Haitians living in the United States and calling home, this was a big market.
Fusion was a relatively small player in the long-distance telephone market. But it was top-heavy with operatives and politicians closely aligned with Bill and Hillary. The board of directors included Tom “Mack” McLarty, Bill’s former chief of staff, and was headed by Ma
rvin Rosen, who had been chairman of the Democratic National Committee’s finance committee during Bill’s 1996 reelection campaign. It was under Rosen’s tenure that the notorious White House fundraising coffees, rental of the Lincoln Bedroom to large contributors, and foreign donations from China and Asia had occurred.32 Also on the board was Ray Mabus, a former Mississippi governor whom Bill had appointed ambassador to Saudi Arabia.33
Teleco’s special arrangement with Fusion was supposed to be public, in keeping with the regulations and laws of the FCC. But the company worked hard to keep it secret. As Wall Street Journal columnist Mary Anastasia O’Grady, who broke the story, wrote, “By law the agreement is a public document but Fusion wouldn’t give it to me until the FCC required them to do so.” It took her eight years to get a copy of the contract.34
It’s easy to see why. The contract gave Fusion access to the Haitian telephone network at a rate of twelve cents a minute, even though the official FCC rate was fifty cents a minute. In short, it was a sweetheart deal. Fusion says it “never made any improper payments or engaged in any improper activity with regard to its relationship with Teleco.” But of course, it didn’t have to.35
After the 2010 earthquake, more than a decade later, there were new telecom prizes available in Haiti. The system was set up so that decisions on doling out contracts and projects went through the Clintons.
In the months following the earthquake, the Clintons began pushing the idea of a wireless mobile phone money-transfer system for Haiti. The idea was to enable friends and relatives to send money directly to people in the quake-ravaged country. Hillary’s USAID was quick to send taxpayer money via a grant; it also organized the effort. The Bill Gates Foundation also came on board. The Haiti Mobile Money Initiative also offered incentive funds to companies who would establish mobile money services in the country.
Clinton Cash: The Untold Story of How and Why Foreign Governments and Businesses Helped Make Bill and Hillary Rich Page 15