Chevron-Gulf Keeps Marxist Angola Afloat

"Now, in spite of the increasingly advantageous position of UNITA, and the imminent collapse of the illegitimate, pro-Soviet government, elements within the State Department are doing their best to salvage the (communist) MPLA, and to prevent the forces for democratic government from winning in Angola."

— Senator Steve Symms, May 14, 1985

In distant, obscure Angola, on the southwest coast of Africa, the alliance between capitalists and communists has matured into its most open blatant form. Possibly the reported export of ballbearing machines to Russia to produce bearings for Soviet missiles may leave some readers with an uneasy feeling, but also with a vague need to come to grips more concretely with the alliance. In Angola the most skeptical reader can see the alliance working on a daily basis.

Angola, a one time Portuguese colony, was "liberated" ten years ago by the MPLA (Popular Movement for the Liberation of Angola), a Marxist organization in alliance with Angolian nationalist groups. The MPLA was not elected and has never held elections. MPLA seized power and has been kept in power by 36,000 Cubans and about 1,200 Soviet military personnel. The Cubans and the Soviets are in Angola for the same reason Angolan Marxists will not allow free elections: because Marxism does not represent the people of Angola.

The United States has been inhibited from encouraging democratic, freely-elected forces by groups within the U.S. State Department and the so-called Clark Amendment (repealed in 1985), sponsored by former Senator Clark, which forbade the U.S. from assisting any group that might challenge the Angolan Marxists.

Yet the Soviets in Angola are challenged as they have never been challenged before; for the first time in 60 years a Marxist regime is in danger of overthrow by internal democratic forces. Angolan guerrillas, known as UNITA (National Union for the Total Liberation of Angola) have taken over one-third of Angola, about 250,000 square miles, and control most of the countryside, particularly in the south.

UNITA is an unusual organization. It is not American-backed. In fact, it is American corporations and the U.S. State Department that have stopped a UNITA victory. UNITA is unusual also in that it believes in free enterprise, free and secret elections, private property, and decentralization of political power. UNITA is led by Jonas Savimbi, aged 51, a ferocious-looking gentleman reminiscent of television's "Mr. T." Savimbi is a European educated black intellectual who believes in individual freedom.

Against Savimbi and UNITA we find the Soviet Union, Cuban forces, the U.S. State Department, American multinationals, and until recently, the U.S. Congress. Some years ago the Senate passed the Clark Amendment, sponsored by Senator Clark, which in effect prevented U.S. aid to this torch of freedom in southern Africa.

The muddled, confused thinking of the United States is well illustrated by a statement made by former U.S. Ambassador to United Nations Donald McHenry, to the effect that the U.S. should not be surprised that the Soviets are aiding Angolan Marxists: "That the Soviets are present to assist the Angolans and to assist the Namibians... is no different from the presence of the United States in El Salvador and U.S. assistance to E1 Salvador."

The point, of course, that McHenry avoids is that the Soviet objective, more than clearly demonstrated in the past 60 years, is a totalitarian controlled society without individual freedom.

The Soviets have indeed assisted Marxist Angola. As far back as 1981 Soviet military officers up to the rank of Colonel were killed and captured in Angola. Soviet Air Force personnel have been captured in Angola (see Now, January 16, 1981.)

The real oddity in Angola is that the single most important factor preventing a free open society is an American multinational corporation. As succinctly stated by Congressman William L. Dickinson (July 1985), "These Cuban troops are protecting American oil interests and they are preventing UNITA from overrunning the MPLA."

In northeast Angola is the Cabinda oil complex owned by Gulf Oil Corporation (since March 1984, part of Chevron Oil of California). CABINDA PROVIDES AT LEAST 80 PERCENT OF MARXIST ANGOLA'S FOREIGN EXCHANGE. The balance comes from diamond concessions operated by Anglo-American Corporation. Soviet and Cuban assistance is paid for from these foreign exchange earnings.

When we look closely at Chevron Gulf, we find that no less than a former U.S. Secretary of Defense, David Packard, has been in a position to thwart Gulf backing for Soviet Angola — yet did nothing.

Gulf Oil Corporation owns Cabinda, and Gulf itself was taken over by Chevron in March 1984. Thus, we have two sets of directors to look at, the original Gulf Oil directors who for a decade allowed the Gulf Cabinda operation to finance Marxist Angola, and the Chevron directors who had the opportunity to change corporate policy towards subsidy of Marxist warfare.

The directors of the former Gulf Oil Corporation were:

Jerry McAfee Robert Dickey, III
H.H. Hammer Julian Goodman
R.H. Dean Sister Jane Scully
J.H. Higgins Edwin Singer
J.P. Gordon E.B. Walker, III
J.E. Lee J.M. Walton

E.I. Colodny

Of these the most vocal in support of Marxism was James E. Lee, former Chairman and Chief Executive officer of Gulf and now a director of Chevron. Lee was strong in support of Marxist Angola, even claiming to the wall Street Journal that the Neto regime was "stable" and "easy to work with." (see cartoon opposite title page.)

In March 1984 Gulf was taken over by Chevron in the largest corporate merger in U.S. history. A few Gulf directors joined the Chevron board and Chevron-Gulf continued to operate Gulf Cabinda, protected by Cuban and Soviet troops, continued to provide most of Angola's foreign exchange and with the Angolan government, planned new joint ventures to expand corporate usefulness to the unelected Marxist government. That Chevron-Gulf should be protected by Cuban troops with Soviet air cover and a Soviet air defense network doesn't seem to embarrass these Chevron directors at all, even though some are directors of major U.S. defense contractors:

Samuel H. Armacost (45), Pres., Dir. & Chief Exec. Off. of Bank of America NT&SA.

Donald L. Bower (61), Vice-Chmn. of Bd. of Co.; Dir., Crocker National Corp., Crocker National Bank.

R. Hal Dean (68), Dir., Ralston Purina Co., Gulf Corp., Mercantile Trust Co., Mercantile Bancorporation, General American Life Insurance Co., LaBarge, Inc.

Kenneth T. Derr (48), Vice-Pres. of Co.; Pres. & Chief Exec. Off., Chevron U.S.A., Inc.

Lawrence W. Funkhouser (63), Vice-Pres., Explor. and Prod., of Co.

John R. Grey (62), Pres. of Co.; Dir., Bank of American NT&SA and BankAmerica Corp.

Kenneth E. Hill (69), consultant to Blyth Eastman Paine Webber, Inc.

Carla Anderson Hills (51), partner, law firm of Latham, Watkins & Hills; Dir., International Business Machines Corp., The Signal Companies, Inc., Corning Glass Works.

George M. Keller (61), Chmn. of Bd. & Chief Exec. Off. of Co.; Dir., First Interstate Bank of Calif., First Interstate Bancorp.

Charles W. Kitto (63), Vice-Pres., Logistics and Trading, of Go.

James E. Lee (63), Vice-Chmn, of Co.; Chmn., Pres. & Chief Exec. Off., Gulf Corp. & Gulf Oil Corp., Dir., Joy Manufacturing Co., Pittsburgh National Bank, PNC Financial Corp., Gulf Canada Ltd., the American Petroleum Institute and West Penn Hospital.

W. Jones McQuinn (61), Vice-Pres., Foreign, of Co.

Charles M. Pigott (55), Pres., Dir. and Chief Exec. Off., PACCAR Inc.; Dir,. The Boeing Co.

Charles B. Renfrew (56), Vice-Pres., Legal Affairs of Co.

George H. Weyerhaeuser (58), Pres. and Dir. Weyerhaeuser Co.; Dir., The Boeing Co., SAFECO Corp.

John A. Young (52), Pres., Dir. & Chief Exec. Off., Hewlett-Packard Co., Dir., Wells Fargo Bank and SRI International.

At the same annual meeting that approved the Chevron takeover of Gulf and so lent Chevron support to Marxist Angola, a Chevron director resigned. This was David Packard, Chairman of Hewlett-Packard and a former Secretary of Defense. There is no record that Packard protested either Gulf support of Marxism or objected that Chevron should not join the band of American corporations who have aided world revolution. We doubt that Packard resigned on grounds of principle, because Packard was an Overseer of the Hoover Institution and Chairman of its Financial Committee back in the early 1970s when Hoover Institution Director W. Glenn Campbell attempted to put pressure on this author to stop publication of the earlier version of this book, National Suicide: Military Aid to the Soviet Union.

Another interesting facet to this story of Soviet-multinational cooperation is in the amount of federal taxes paid by these giant firms. In 1976 Gulf had a federal tax rate of 2%. In 1984 Gulf claimed a tax refund, even while showing a profit of $313 million. Gulf 1984 tax rate was minus 8.3% (with a refund of $26 million). So in the same year that Gulf contributed most of Marxist Angola's foreign exchange and paid Angolan taxes, it demanded $26 million refund from U.S. taxpayers. If payment of taxes is a measure of patriotism, then Gulf Oil allegiance is more than clear.

Identification of the Deaf Mute Blindmen

The severity of our charges in the Chevron-Gulf case suggest that we be doubly careful in identification of the deaf mute blindmen. Not all directors of multinational corporations fit the description. Some in fact decidely do not. Not all politicians and bureaucrats fit the bill, although it is hard to find exceptions in Department of State.

Let's take a paradoxical example to demonstrate the need for care. In the Reagan Administration both Secretary of Defense Casper Weinberger and Secretary of State George Schultz are former officers of Bechtel Corporation, the multinational construction firm. However, Weinberger is one of the few in Washington to understand technological transfers. George Shultz on the other hand has a long-time unchanging record in favor of continuing transfers. Yet both have been top officials within Bechtel Corporation.

While Department of State has never produced a single opponent of transfers, the Department of Commerce has — Lawrence Brady. And although Weinberger is at DoD, the same department has produced several deaf mutes from among its top officials. The previously cited David Packard, Chairman of Hewlett-Packard, is a major sponsor of Congressman Ed Zschau, a vocal active supporter of more aid to Soviet military power.

Identification has to be handled on a case by case, individual basis.

What is to be Done?

The basic solution to Chevron-Gulf and other cases is political. It will take pressure from grass roots Americans and indeed from all those who love freedom to knock sense into their elected representatives and then into successive administrations and finally into the deaf mute blind-men.

There is, however, a startpoint which is demonstrated by the Chevron-Gulf case. Department of Defense has shown realistic concern over transfers of technology and the military end-use in Soviet world ambition. Why doesn't DoD start to consider Western technology to the Soviets in the award of DoD contracts?

In brief, penalize those firms working both sides of the street. If Chase Manhattan wants to finance Soviet contracts, all well and good, but it should not also expect a piece of the U.S. Defense pie at the same time. If General Electric wants to sell to the Soviets, OK, let G.E. go ahead —within the law — but not also simultaneously benefit from DoD contracts. If Chevron-Gulf want to work hand-in-glove with Soviet military ambitions, they should not also be able to bid on U.S. government contracts and claim federal tax refunds when the firm is making substantial profit. When awarding DoD contracts, preference should be given to those U.S. and foreign firms who show enough sense to walk away from Soviet deals.