From the Baltimore Chronicle

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Republican-controlled Carlyle Group poses serious Ethical Questions for Bush 
Presidents, but Baltimore Sun ignores it
by Alice Cherbonnier
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AN IMPORTANT TENET of journalism is that you should always ask, “Who 
benefits?”

In the case of a war, the answers to this question become of paramount 
importance. Suppose, for example, that profits from military contracting 
were to go in the pockets of a former U.S. President whose son (and a 
presumed future heir) is now President? Suppose further that such profits 
escalate in times of conflict. Wouldn’t this be of concern to the public? 
Wouldn’t you expect the media to be all over such an important ethical (not 
to mention moral, and maybe legal) angle?

Though described by the Industry Standard as “the world’s largest private 
equity firm,” with over $12 billion under management, chances are readers 
haven’t ever heard of The Carlyle Group. Isn’t that a little odd, 
considering it is run by a veritable who's who of former Republican 
political leaders. Former Defense Secretary Frank Carlucci is Carlyle’s 
chairman and managing director (who, by the way, was college roommate of the 
current Defense Secretary, Donald Rumsfeld). And that partners in this 
mammoth venture include former U.S. Secretary of State James A. Baker III, 
George Soros, Fred Malek (George H.W. Bush’s campaign manager, forced to 
resign when it was revealed he was Nixon’s “Jew counter”), 
and—presumably—George H.W. Bush?

We say “presumably” because the privately-held Carlyle doesn’t have to 
reveal information about its partners or investments to the SEC or to anyone 
else. Our former President is reported to be active in seeking investments 
for the Carlyle Group from the Asian market, and word is he’s paid between 
$80,000 to $100,000 per presentation.

All told, Carlyle has about 420 partners all over the globe, from Saudi 
princes to the former president of the Philippines. Its investments run 
heavily in the defense sector; they make money from military conflicts and 
weapons spending. But who in Baltimore knows about it?

A search of the Baltimore Sun’s website reveals no mentions whatsoever of 
The Carlyle Group, though it’s been around since 1988 and has been involved 
in numerous buy-outs and buy-ins, sometimes with SEC-regulated companies 
that have to report these things. Contrast this news blackout with the 
Washington Post’s 378 mentions, and the New York Times’ 332 hits. Even the 
Philadelphia Inquirer weighed in with 15 mentions.

Not only have some newspapers and magazines brought The Carlyle Group out of 
the shadows it prefers, but this enterprise has attracted the attention of 
The Center for Public Integrity and Judicial Watch, both of which have 
concerns about the ethical propriety of having high-placed former government 
officials—trained at taxpayer expense, too—out there reaping over 20% to 40% 
a year by working their connections. You have to wonder if these former 
public servants are just simply greedy, or if they’re telling themselves 
they’re true patriots by doing behind-the-scenes cloak-and-dagger stuff.

This is a big story. We were wondering if, in the wake of current events, we 
were the only newspaper that was asking that question, “Who benefits?” And 
then we found that the Wall Street Journal was asking the right questions, 
too, and we were vastly relieved not to be left hanging out to dry. On Sept. 
27, the WSJ published a “Special Report: Aftermath of Terror” with the 
headline “Bin Laden Family Could Profit From a Jump In Defense Spending Due 
to Ties to U.S. Bank.” The “bank” is actually The Carlyle Group (and by the 
way, we peons can’t invest in it, and it sure isn’t taking deposits from the 
general public). The lead sentence reads: “If the U.S. boosts defense 
spending in its quest to stop Osama bin Laden’s alleged terrorist 
activities, there may be one unexpected beneficiary: Mr. bin Laden’s 
family.” And, though the WSJ curiously did not mention this, another 
beneficiary may be George H.W. Bush’s family.





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