Code Pink, Raging Grannies ask Feinstein
to return profits to Iraq amid allegations
of corruption and war profiteering

Feinstein releases statement to Fog City Journal

Members of Code Pink and Raging Grannies staged a protest yesterday outside the house of Sen. Dianne Feinstein (D-Cal) and husband Richard C. Blum calling on the couple to return alleged profits realized while Feinstein was chair of the Senate Subcommittee on Military Construction Appropriations.
Photo(s) by Luke Thomas

By Luke Thomas

April 9, 2007, 8:30 a.m.

Members of Code Pink and Raging Grannies held a peaceful protest Sunday outside the home of Senator Dianne Feinstein (D-Cal) and husband Richard C. Blum. The peace groups are asking Feinstein and Blum to return alleged war profits the couple realized while Feinstein was chair of the Senate Subcommittee on Military Construction Appropriations, to the people of Iraq.

Blum is a majority owner in Perini Corp. and URS Corp., two companies awarded favorable contracts while Feinstein was chair of the subcommittee. Feinstein recently resigned her post as chair of the subcommittee, according to reports, while questions were being raised about a potential conflict of interest.

Senator Dianne Feinstein and Richard C. Blum

Feinstein has since broken her silence on the matter calling the allegations "nonsense" and denying she played a role in awarding military contracts that benefited companies owned by Blum.

Medea Benjamin, co-founder of Code Pink, said of the protest: "We were outside Senator Diane Feinstein's house for two reasons. One was to pressure her to stop funding the war and to support the new legislation introduced by Sen. Russ Feingold, with the support of Sen. Harry Reid that calls for the troops to be home within a year - with a fixed timetable for withdrawal.

Code Pink co-founder Medea Benjamin

"The other reason is our concern about her conflict of interest, with her husband Dick Blum receiving multi-million dollar defense contracts while she headed the subcommittee on military construction. We feel that she and her husband have profited from this war, and they should return the profits back to the Iraqi people. Moreover, although Feinstein recently resigned from the subcommittee, we are urging an investigation into the conflict of interest."

Called for comment on the allegations, Feinstein spokesperson Scott Gerber today released the following statement to Fog City Journal:

“It is nonsense to suggest that Senator Feinstein resigned from the Military Construction Appropriations Subcommittee. That’s just not true.

At the beginning of every Congress, openings on subcommittees become available for one reason or another, and members have an opportunity to change subcommittees based on seniority.

Prior to serving on the Military Construction subcommittee, Senator Feinstein served as Chairman or Ranking Member of the DC Appropriations Subcommittee and the Legislative Branch Appropriations Subcommittee.

This year, following the departure of Senator Reid from the Committee, the opportunity became available for Senator Feinstein to move up once again – and become the Chairman of the Interior Appropriations Subcommittee. Eight other Appropriations Committee members made similar changes as well.

The Interior Subcommittee has responsibility for funding the Forest Service, the Park Service, and the Environmental Protection Agency. This was a better committee assignment for California, and so Senator Feinstein took the opportunity. She became Chairman of the Interior Subcommittee in January.

Senator Feinstein has sought to avoid potential conflicts in two ways.

First, by seeking the advice of the Senate Ethics Committee on her own initiative about whether conflicts existed – and following that guidance. That guidance indicated that, given the facts, Senator Feinstein could fully consider, debate, and vote on appropriations bills, whether in the subcommittee, committee or full Senate.

Second, by never crossing the line between the congressional appropriations process and the separate Department of Defense contract award process.

Each year, the Military Construction Appropriations Subcommittee reconciles the President’s Budget Request with the Committee’s allocation of funding to the Subcommittee (302b).

Every project (such as family housing, National Guard and Reserve facilities, facilities on active duty military bases worldwide, etc.) included in the Senate Military Construction Appropriations bill is identified for funding in the Defense Department’s planning document (Future Years Defense Plan). Every project must be also independently authorized by the Senate Armed Services Committee, on which Senator Feinstein does not sit.

The bill does not include contracts, but rather lump-sum appropriations.

Ultimately, Congress votes on the bill, typically by overwhelming margins, and the President signs it into law.

Subsequently, the contracts for these projects are awarded by the Department of Defense in a completely separate process. Congress plays no role in determining which entities are awarded these contracts.

Let me be clear and specific:

Senator Feinstein never sought to influence which entities were awarded any military construction contracts. Neither she nor her staff ever wrote, spoke to, or influenced in any way Defense Department officials in charge of determining which entities were awarded any military construction contract.

So bottom line, there is no conflict."

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