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Media Smackdown

July 2nd, 2004 11:32 PM

Michael Isikoff and Newsweek Magazine Deceive the Public About Fahrenheit 9/11

In the June 28, 2004 issue of Newsweek Magazine, Newsweek writer Michael Isikoff makes completely false and misleading statements about facts and issues contained in Fahrenheit 9/11. Isikoff has also gone on television shows repeating the charges.

Here are some of the falsehoods he is telling, and the truth:

Saudi Flights: Isikoff writes that "The movie claims that in the days after 9/11, when airspace was shut down, the White House approved special charter flights so that prominent Saudis - including members of the bin Laden family - could leave the country. Author Craig Unger appears, claiming that bin Laden family members were never interviewed by the FBI. Not true, according to a recent report from the 9/11 panel."

Isikoff's account of the movie is flatly untrue.

What the movie says is this: "It turns out that the White House approved planes to pick up the bin Ladens and numerous other Saudis. At least six private jets and nearly two dozen commercial planes carried the Saudis and the bin Ladens out of the U.S. after September 13th. In all, 142 Saudis, including 24 members of the bin Laden family, were allowed to leave the country."

These facts are based entirely on the findings contained in the 9/11 commission draft report, which states, "After the airspace reopened, six chartered flights with 142 people, mostly Saudi Arabian nationals, departed from the United States between September 14 and 24. One flight, the so-called Bin Ladin flight, departed the United States on September 20 with 26 passengers, most of them relatives of Usama Bin Ladin." National Commission on Terrorist Attacks Upon the United States, Threats and Responses in 2001, Staff Statement No. 10, The Saudi Flights, p. 12;

Isikoff claims that Fahrenheit 9/11 says that these flights out of the country took place when commercial airplanes were still grounded. The film does not say this anywhere. The film states clearly that these flights left after September 13 (the day the FAA began to slowly lift the ban on air traffic).

Moreover, in an interview with author Craig Unger, the film makes reference to the fact that these individuals were briefly interviewed before they were allowed to leave. Here is how Unger put it in a Letter to the Editor to Newsweek today (June 22, 2004):

To the Editors:

In "Under the Hot Lights," Michael Isikoff attacks Fahrenheit 9/11 by asserting that "Craig Unger appears, claiming that bin Laden family members were never interviewed by the FBI." The article then goes on to say that this assertion is false.

Unfortunately for Isikoff, I make no such statement in the movie. I do argue -- accurately -- that the bin Ladens and other Saudis were whisked out of the country without being subjected to a serious investigation. But the sequence to which Isikoff refers ends with director Michael Moore summing up my account of the bin Laden evacuation by saying, "So a little interview, check the passport, what else?" "Nothing," I respond.

It would be one thing if Isikoff had simply made an honest error; but that clearly is not the case. When he called me, I specifically told Isikoff that the evacuation process involved brief interviews of the bin Ladens which fell far short of the kind of intense criminal investigation that should have gotten underway after the murder of nearly 3,000 people. The worst crime in American history had just taken place two days earlier, and the FBI did not even bother to check the terror watch lists. Isikoff omitted all that. Instead, he put words in my mouth that are simply not in the movie.

Isikoff also wrongly asserts that the Saudi "flights didn't begin until September 14 -- after airspace reopened." In fact, as I reported in House of Bush, House of Saud, the first flight took place on September 13, when restrictions on private planes were still in place. According to the St. Petersburg Times, that flight has since been corroborated by authorities at Tampa International Airport. Isikoff knew all this. I told him. I even gave him the names of two men who were on that flight and told him how to get in touch with them. But Isikoff left all that out as well -- as he did other information that did not suit his agenda. In dismissing the Bush-Saudi ties, Isikoff even omits the fact that more than $1.4 billion in investments and contracts went from the House of Saud to companies in which the Bushes and Cheney have been key figures -- all of which is itemized in my book. Isikoff begins his article by asking, "Can Michael Moore be believed?" The real question should be whether Michael Isikoff can be believed. Clearly, the answer is no.

Craig Unger
New York City, NY

(Note: The St. Petersberg Times article to which Unger refers also states, "The 9/11 Commission, which has said the flights out of the United States were handled appropriately by the FBI, appears concerned with the handling of the Tampa flight... Most of the aircraft allowed to fly in U.S. airspace on Sept. 13 were empty airliners being ferried from the airports where they made quick landings on Sept. 11. The reopening of the airspace included paid charter flights, but not private, nonrevenue flights." Jean Heller, TIA now verifies flight of Saudis; The government has long denied that two days after the 9/11 attacks, the three were allowed to fly.
St. Petersburg Times, June 9, 2004.)

2. Carlyle and United Defense. Isikoff writes, "The movie quotes author Dan Briody claiming that the Carlyle Group 'gained' from September 11 because it owned United Defense, a military contractor. Carlyle Group spokesman Chris Ullman notes that United Defense holds a special distinction among U.S. defense contractors that is not mentioned in Moore's movie: the firm's $11 billion Crusader artillery rocket system developed for the U.S. Army is one of the only weapons systems canceled by the Bush administration."

This is completely misleading. The Crusader contract was canceled AFTER UNITED DEFENSE WENT PUBLIC, which is the entire point of the movie.

Here is what the film says: "September 11th guaranteed that United Defense was going to have a very good year. Just 6 weeks after 9-11 Carlyle filed to take United Defense public and in December made a one day profit of $237 million dollars."

This is exactly what happened, to wit:

"On a single day last month, Carlyle earned $237 million selling shares in United Defense Industries, the Army's fifth-largest contractor. The stock offering was well timed: Carlyle officials say they decided to take the company public only after the Sept. 11 attacks... On Sept. 26, [2001], the Army signed a $665-million modified contract with United Defense through April 2003 to complete the Crusader's development phase. In October, the company listed the Crusader, and the attacks themselves, as selling points for its stock offering. Mark Fineman, "Arms buildup is a boon to firm run by big guns," Los Angeles Times, January 10, 2002.

"Or its 1997 purchase of United Defense for $ 180 million. Four years later -- just before Rumsfeld canceled its Crusader howitzer program -- Carlyle took United Defense public and sold about half the stock for $ 588 million." Greg Schneider, "Connections and then some," The Washington Post, March 16, 2003

In "Crusader a Boon to Carlyle Group Even if Pentagon Scraps Project," Washington Post's Walter Pincus wrote (May 14, 2002):

Carlyle's financial success with United - and the success of others associated with the Crusader - shows how major Pentagon weapon systems can turn into cash cows. In turn, United's lobbying expenditures and campaign contributions show why they can be so difficult to kill, as Secretary of Defense Donald H. Rumsfeld announced he would try to do with the Crusader last week.

'Carlyle's aggressive approach ...is one reason why the Crusader lived this long,' said Lawrence J. Korb, an assistant secretary in the Reagan Pentagon and now director of studies at the Council on Foreign Relations. Even if Rumsfeld's decision stands, Korb said, United still will have received $ 2 billion from the Crusader program and will receive substantially more to close it down.

Still, in its annual report for 2001, United announced that it had been awarded a three-year, $ 697 million contract to complete full upgrading of 389 Bradley units and had added a $ 655 million contract modification to complete the Crusader's "definition and risk-reduction phase contract," which would be worth $ 1.7 billion through 2003. Together, the Crusader and Bradley programs contributed 41 percent of United sales in 2001, the report said.

With Crusader and the Bradley upgrade in hand, a decision was made to sell United stock to the public in late 2001. In preparation, United refinanced the roughly $ 180 million it owed on the original purchase loan, securing a new $ 600 million loan and $ 200 million in revolving credit.

...

After the debt restructuring came the stock offering. The United offering filed with the Securities and Exchange Commission included this boilerplate caveat to potential investors: 'The Carlyle group, our other stockholders and our executive officers will realize substantial benefits from the offering.'

When it took place, in December 2001, Carlyle sold 11 million shares of the 20 million offered at $ 19 a share, receiving a total of about $ 225 million. Even so, Carlyle still owns more than 47 percent of the outstanding United shares and controls United's board of directors.

Also in late 2001, according to SEC filings, Peay and Shalikashvili were paid 'performance' bonuses, though their separate employment contracts filed with the SEC state they only are to serve as directors and receive $ 25,000 annual retainers plus stock options and reimbursed expenses. Peay received $ 160,000, and Shalikashvili $ 102,586, according to a filing with the SEC.

A United spokesman said the generals did no lobbying and that their bonuses were similar to ones given company officers based on "the performance of the company." Neither retired general responded to requests for comment. Korb, who served as a vice president at Northrup, said he had never heard of company directors receiving bonuses based on the performance of the company.

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