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Can we afford to ignore the Carlyle Group?

by Saida Olver


Since the beginning of the “war on terrorism,” the Carlyle Group, a U.S. private equity fund, has capitalized on the U.S. Army. The headquarter of the 11th largest defense contractor in the United States is located in the heart of Washington D.C. on Pennsylvania Avenue, surrounded by the White House, the FBI, and the Capitol building, the focal point of American supremacy. Some say that its address reflects its association with the powerful “ex-presidents club.” The group’s ruthless business style and political clout make it easy to see obvious problems within our current system of government.


For 18 years, the company has recruited political notables from around the world. James Baker III, former U.S. Secretary of State under George H.W. Bush and staff member under Ronald Reagan and George W. Bush; Frank C. Carlucci, United States Secretary of Defense from 1987 to 1989; George H.W. Bush, former president of the United States; Fidel Ramos, former president of the Philippines; Frank McKenna, current Canadian ambassador to the United States; Park Tae Joon, former prime minister of South Korea; and Alice Albright, daughter of ex-Secretary of State Madeline Albright, to name a few.

Through the Carlyle Group, President G. W. Bush worked for the bin Laden family business in Saudi Arabia. The bin Ladens have been huge investors in Bush Senior’s former firm.

The group’s vast connections allow it to interlock its political influence with the buyout business. They purchase companies that are struggling, fix and resell them at a huge profit. These companies specialize in everything from defense contractors to telecommunications and aerospace. This intermingling is the so-called “iron triangle” of defense, government, and industry. When the New York City World Trade Center towers came down, the Carlyle Group’s financial future brightened.

Red flags have to be raised given the relationship with Saudi Arabian government which has been criticized for not cooperating in the war on terrorism and for financially supporting terrorist attacks on Israeli and U.S. interests.

More red flags need to be raised over President G.W. Bush, who has helped create a $7 trillion dollar national debt that has enriched his and his father’s business interests. Some wonder if this is how the president will get rich. He will just inherit Bush Senior’s millions. No one has frozen the Bush family accounts because of their connections with terrorism. Why is that?

Certainly, war is proving to be successful for the conglomerate. The Carlyle Group has owned a company named United Defense for nearly a decade. The company makes the controversial Crusader, a 42-ton, self-propelled howitzer that operates like a tank. It can lob ten 155-mm shells per minute as far as 40 kilometers. The Clinton administration argued that it was a “relic of the cold war era—to a heavy and slow for today’s warfare.” The Pentagon recommended that the program be suspended, but thanks primarily to the Carlyle Group, the Crusader is still being purchased by the Pentagon. Those close to the situation speculate that the reason Donald Rumsfeld decided to keep the Crusader active is because Mr. Rumsfeld and The Carlyle Group’s Carlucci are close friends (They were wrestling partners during their Princeton University days).

Also, serious problems lie with the mixing of politics with business. James Baker, Carlyle’s senior counselor, has been simultaneously trying to persuade the world to forgive Iraq’s debt while toiling for Carlyle to recover money from Iraq. The group has joined a consortium, according to an article in The Guardian (“Bush special envoy embroiled in controversy over Iraq debt,” Naomi Klein, Oct. 13, 2004) that has secretly been trying to collect $27 billion on behalf of Kuwait. The group claims that Baker would not be able to personally profit, but the consortium would make millions.

The Carlyle Group and the Bush administration are walking a thin line by mixing the political clout with business profits. The American people need to pay closer attention to and question the Carlyle Group’s monetary profits.



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