Richard Perle: It Pays To Be the Prince of Darkness

Frida Berrigan

Richard Perle is a busy guy these days, what with his long-desired war against Iraq in full swing, plus a lucrative consulting business on the side. As the chairman of the Defense Policy Board, Perle is a close adviser to Defense Secretary Donald Rumsfeld, with an insider’s perspective on the Pentagon, the war in Iraq and the ongoing war on terrorism. As a major investor in a number of defense companies, he stands to reap considerable benefits from war and homeland security contracts. Apparently his dual roles as a major policy adviser to the Pentagon and a business dealmaker can be a bit confusing at times.

A few weeks ago, Perle was hired by Global Crossing, the bankrupt telecommunications giant that is trying to sell itself to a Chinese consortium. The Pentagon and FBI are against the sale because it would put the company’s fiber optics network, which is used by the U.S. government, in Chinese hands. Perle’s job is to change their minds. And if anyone can, it is the “Prince of Darkness,” as Perle is known by friend and foe in Washington.

As he said in an affidavit dated March 7, his position as chairman of the Defense Policy Board gives him a “unique perspective on and intimate knowledge of the national defense and security issues that will be raised by the CFIUS review process.” The CFIUS, the Committee on Foreign Investment in the United States, has the power to block the deal. Global Crossing is paying Perle $750,000 for this “unique perspective” and “intimate knowledge.” Perle’s incentive: $600,000 of his fee is contingent on government approval of the deal.

But this little phrase led to a funny exchange with New York Times reporter Stephen Labaton. Perle insisted, “I’m not using public office for private gain, because the Defense Policy Board has nothing to do with the CFIUS process.” But when asked about his “unique perspective” and “intimate knowledge,” Perle claimed he had not noticed that phrase, saying it “was drafted by lawyers, and frankly I did not notice it.” He is a busy man, we understand.

But then, he called Labaton back to clarify, saying that the problematic phrase was in an earlier draft, he had noticed it and crossed it out. “You have a draft that I never signed,” he said. OK?

After consulting with Global Crossing’s lawyers, Perle called Labaton again to say that he had told the lawyers to strike the phrase because it “seemed inappropriate and irrelevant.” But then someone put the phrase back in, and Perle signed it without noticing. “It is a clerical error,” he explained, “and not my clerical error.” When in doubt, blame the lawyers.

So the final version will be submitted without referring to Perle’s “unique perspective” and “intimate knowledge.” But that doesn’t mean those are not what Global Crossing is paying him for.

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This is not the first time someone has questioned Perle’s ethics. Pulitzer Prize-winner Seymour Hersh, writing in the March 17 issue of The New Yorker, cited possible “conflicts of interest” in Trireme Partners, Perle’s venture capital company. The company, which invests in companies dealing in homeland security and defense products, has raised $45 million in capital so far—almost half of that coming from U.S. defense giant Boeing. When asked about the article in a TV interview, Perle declared that “Sy Hersh is the closest thing American journalism has to a terrorist, frankly.”

There is also the matter of Autonomy Corporation, where Perle is a director, with 75,000 shares of stock. The firm has developed a high-tech eavesdropping software that is capable of monitoring hundreds of thousands of e-mail and phone conversations at the same time. In October 2002, the Department of Homeland Security granted the company a huge contract. A few months later, Autonomy was granted $1 million in contracts from a number of government agencies, including the Secret Service and National Security Agency.

As a former Clinton adviser observed with admiration, Perle “enjoys all the benefits of being an insider without any of the constraints.”

Frida Berrigan is a senior program associate with the New America Foundation’s Arms and Security Initiative and a member of the Campaign for a Nuclear Weapons Free World.
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