Thursday, March 23, 2006

Richard Perle's Nemesis

Commentary by Martin Kelly
September 10, 2004

Downward and downward spiral the fortunes of Conrad Black, the deposed CEO of Hollinger International, the only tycoon in history brought low by his wife’s taste in shoes. Last week, the sometime Sun King of the Sun-Times received a mortal blow in the form of an internal report into his alleged malfeasance called ‘The Hollinger Chronicles’ authored by a personage no less prominent than Richard Breeden, former chairman of the SEC.

It is damning stuff. According to Dominic Rushe in the September 5 Sunday Times, Breeden has found that throughout the period of 1997-2003, the amount of money taken by Black and his cohort David Radler in a policy of ‘aggressive looting’ amounted to $400m, a staggering 95.2% of Hollinger’s net income for that period. Although there might not be much to substantiate the investigations by the SEC and the Illinois authorities, if he is found to have breached any SEC rules Black is automatically guilty of violating a consent decree requiring him to comply with securities laws, which was passed with his consent in 1982 and which remains in force, following litigation against sometime target Hanna Mining. Such violation is a criminal offence, and he goes straight to the hole.

However, it’s not only King Conrad who should be quaking in his boots with this report’s release. As a result of his failure to perform the duties incumbent upon him as a member of Hollinger’s executive committee, uber-neoconservative Richard Perle, ‘The Prince of Darkness’, sometime Chairman of the Pentagon Defence Policy Board, may soon find himself out of pocket to the tune of – wait for it, I’m savouring this – 5 MILLION DOLLARS!

Perle is not just a neoconservative – he is the personification of that philosophy. Along with David Frum, he is the co-author of An End to Evil, neoconservatism’s vision for the Middle East. Frum, like Black a Canadian by birth, was a columnist for Blacks’s National Post before being hired as a Bush speechwriter. Fired after his wife’s Internet boast that he coined the phrase ‘Axis of Evil’, Frum then penned the Bush hagiography The Right Man, before finding his true level as resident ideologue of the National Review Online. Frum is a hatchet man with a strong tendency towards self-promoting buy-the-book conservatism. In March 2003, he published a scandalous article in the National Review called ‘Unpatriotic Conservatives’ accusing Pat Buchanan, Robert Novak, Samuel Francis and others of, amongst other things, disloyalty, anti-Semitism and racism as payback for their refusal to support the Iraq War. Buchanan returned the compliment to Perle in a classic article, ‘Whose War?’ published in the March 24 2003 American Conservative.

Perle started his career in public life as an aide to Scoop Jackson. In 1983, the New York Times reported that he had been paid by Israeli weapons manufacturers. In 1996, he co-authored a report for Likud Prime Minister Benjamin Netanyahu called ‘A Clean Break: A New Strategy for Securing the Realm’ along with arch-neoconservative Douglas Feith. Buchanan quoted directly from the paper:

“Israel can shape its strategic environment, in co-operation with Turkey and Jordan, by weakening, containing and even rolling back Syria. This effort can focus on removing Saddam Hussein from power in Iraq – an important Israeli strategic objective in its own right – as a means of foiling Syria’s regional ambitions”

Four years after writing that, Perle was back at The Pentagon. It was in the office of Feith, now the number three civilian at The Pentagon, that the suspected Israeli agent Lawrence Franklin worked.

However, Breeden blasts Perle for the lack of care he exhibited towards the interests of the wider shareholder democracy forming Hollinger International. Perle was not just a main board director; he was a member of the corporation’s executive committee. He should have been scrutinising the web of interlocking companies, the non-compete fees, the management fees and the asset sales and purchases that seem to have enabled Black and Radler get their hands on so much for so long. Either Perle wasn’t doing his job properly or he was looking the other way. Breeden proposes that the ultimate penalty be imposed on Perle for his consistent failure to perform. Black’s biographer Richard Siklos, writing in Hollinger’s former title The Sunday Telegraph of September 5, quotes Breeden thus –

“As a faithless fiduciary, Perle should be required to disgorge all compensation he received from the company”.

Over the course of his involvement with the company, Perle was paid a total of 5 million dollars. If Perle is called upon to repay this sum, it will be very interesting to see who is backing him up.
‘A faithless fiduciary’. Man, that must really hurt. However, Conrad Black liked his company. Under Conrad Black, both the Daily and Sunday Telegraphs faithfully parroted the neoconservative line. According to Dominic Rushe, Hollinger International’s board meetings were civilised affairs, where, after a brief chat about the operations and tribulations of a global media empire, Black, Perle and Henry Kissinger would chew the fat about politics. It’s a pity that more time wasn’t spent on discussing corporate affairs; otherwise the Louisiana Teachers’ Pension Fund might not now be suing Hollinger. It just goes to show that, in business as in politics, don’t ever ask a neocon to mind the store.