Tuesday, February 20, 2007

Military Industrial Complex - "Ike Was Right!"

Military Industrial Complex

By By John Hanchette
The Niagra Falls Reporter

     OLEAN -- I have come to believe Dwight David Eisenhower, our 34th president, is one of the most underrated and unappreciated men ever to hold that office.

All of my high school years occurred during Ike's second term. Think "Happy Days" of TV fame, with Fonzi and the malt shop. To most parents, the biggest crisis seemed to be this terrible rock 'n' roll music that was sweeping the nation and corrupting our youth. The new dance sensation the Twist (in which partners never even touched each other) was banned at my high school, despite being downright puritanical by today's standards.

The White House coverage was pretty boring, and so was Ike. The American public loved him because not much all that bad was happening and he'd gotten us out of the Korean War, but he was viewed by most commentators as an unimaginative avuncular type.

Young people paid so little attention to him that my birth cohort was dubbed the Apathetic Generation. (We dispelled that unfair tag when Vietnam came along.)

Eisenhower, however, in January of 1961, in his last speech before vacating the White House to make room for the just-elected John F. Kennedy, warned America of a "disastrous rise of misplaced power" if we continued allowing the germination of a new historical entity he called "the military-industrial complex."

Very few Americans knew what the heck Eisenhower was talking about. We do now.

It's 46 years later, and we are rapidly coming to realize the federal government really doesn't run this country anymore. Huge, shady corporations with fat federal contracts do.

The public's concept of federal government was basically forged by FDR's all-encompassing, can-do successes of ending the Depression and winning World War II. That no longer holds. Recent presidents and Congresses -- under pressure from taxpayers and voters -- have downsized government to the point where private companies are under federal contract to perform a broad scope of functions and get the actual work done. Almost everything is farmed out.

Don't believe me? Consider this mind-twisting equation from a well-researched article in the current issue of "Vanity Fair" magazine: Private federal contractors now "absorb the taxes paid by everyone in America with incomes under $100,000."

Viewed a bit differently, "more than 90 percent of all taxpayers might as well remit everything they owe directly ... to some contractor rather than to the IRS."

Disastrous "misplaced power" indeed. Ike was right.

The "Vanity Fair" article is written by two of the best investigative reporters of our time, Donald L. Bartlett and James B. Steele, who used to ply their craft for The Philadelphia Inquirer until that double digit-Pulitzer Prize winning newspaper lost its appetite for expensive investigative reporting. Bartlett and Steele, who won two of those Pulitzers and 50 other national journalism awards, went to "Time" magazine and now to the increasingly aggressive "Vanity Fair."

Their first article for the big, slick magazine lays open the above situation, which the authors call "Eisenhower's nightmare." They illustrate the dominance of the military-industrial complex by describing the success of a powerful private company only a tiny fraction of Americans have even heard of -- Science Applications International Corporation, or SAIC.

I first came across SAIC about 15 years ago while toiling as a Washington reporter covering the Pentagon and other bureaucracies in the wake of the Persian Gulf War -- Bush the Elder's speedy eviction of Saddam Hussein from Kuwait in 1991, and equally speedy pullout once the work was done. (Daddy Bush was smarter than his son in suspecting an American occupation force in Iraq would lead to deadly and ruinous civil war, a conflict of religions and disruption of political balance in the entire Middle East.)

Thousands of troops had come home from that war with mysterious, multi-symptom maladies -- some deadly -- that for years drew persistent Pentagon scorn for the afflicted vets as gold-bricking shirkers and benefit-seekers who weren't really sick at all, or if they were, the Defense Department held, the illnesses were minor and mostly in their heads.

Non-government doctors and medical experts in the Veterans Affairs Department tended to think otherwise, validating the illnesses as serious and chronic under the general term Gulf War Syndrome, but still seeking the causes. The ensuing conflict of professional opinions led the Pentagon, VA and Department of Health and Human Services to hire dozens of private-sector consultants to advise the federal defense, health and intelligence communities.

One of the favorite consultant firms that kept cropping up on this or that aspect of the debate was SAIC -- and surprise of surprises, SAIC almost always backed the Pentagon view, despite the evolving government admission the debilitating mystery illnesses eventually affected almost a fifth of those who served.

Editorial interest in pursuing descriptions of some vague consulting firm waned, and I never got the go-ahead to write much about SAIC, but now Bartlett and Steele have nailed this spooky firm they call a "stealth company."

SAIC, founded in 1969, employs more than 44,000 workers and took in about $8 billion in revenue last year, almost all of it from the federal government. It currently holds more than 9,000 active federal contracts. More than 100 of them, state the authors, are worth more than $10 million each. Two of them are worth more than $1 billion. If all the contracts negotiated and pending are eventually signed, federal taxpayers will shell out another $13.6 billion to SAIC. Indeed, it is hard to keep current with the federal government's use of SAIC.

Over the weekend, as this column was in preparation, the National Aeronautics and Space Administration hired SAIC for $13.5 million to "support" NASA's Johnson Space Center "financial and administrative system services" in procurement, human resources and daily operations. The contract will be worth $25 million if two additional one-year options are signed. The language says SAIC will provide "sustaining engineering and system integration support for administrative systems." That's about as specific as most federal contracts get these days.

In its recent existence, SAIC was the largest employee-owned research and engineering firm in the country, ranking 285 on the Fortune 500 list and boasting a return on revenue larger than ExxonMobil's storied percentages. SAIC stock went public last fall. Its share price rose 40 percent within a matter of days.

What SAIC purports to do is provide the federal government with the brainpower and computer expertise to run its vast and extensive defense, security and intelligence operations. According to Bartlett and Steele, "no Washington contractor pursues government money with more ingenuity and perseverance than SAIC. No contractor seems to exploit conflicts of interest in Washington with more zeal. And no contractor cloaks its operations in greater secrecy."

SAIC, according to the "Vanity Fair" article, "has become the invisible hand behind a huge portion of America's national-security state."

Talk about conflicts of interest. SAIC hires top federal officials at such a prodigious rate the Washington "revolving door" spins so fast it makes the mind blur. SAIC, write Bartlett and Steele, "might as well operate an executive shuttle service between its McLean, Virginia offices and the CIA, the FBI, the Pentagon, and the Department of Energy."

Some examples:

New Defense Secretary Robert M. Gates is a former SAIC board member.

Former defense secretary Melvin Laird is a former SAIC board member.

Former CIA director John M. Deutch is an SAIC board member.

Donald Foley, until recently a top executive at the Defense Advanced Research Projects Agency (DARPA), the military agency that invented the Internet, is a current SAIC director.

Rear Admiral Bobby Inman went from head of the National Security Agency to SAIC board member.

Undersecretary of Defense Ryan Henry is former senior vice president of SAIC.

William B. Black Jr. retired from a top National Security Agency office in 1997 to become SAIC vice president. In 2000, he returned to the NSA. Two years later, NSA awarded SAIC a $280 million contract for "Trailblazer" -- a much-touted effort to redesign an NSA computer system that had failed to highlight and interpret such missed such 9/11 terrorism clues as the intercepted Arabic message on Sept. 10: "Tomorrow is zero hour."

"Four years and more than a billion dollars later," write Bartlett and Steele, "the effort has been abandoned." SAIC is not fretting. It recently was awarded another $361 million intelligence contract to have another go at the Trailblazer concept.

The company is "packed ... with generals, admirals, diplomats, spies, Cabinet officers -- people with access." SAIC, write the authors, is "a private business that has become a form of permanent government." SAIC developed expertise in getting both ends of the play -- "writing regulations on the recycling of radioactive metals even as it went into the recycling business."

But things may be changing. Government audits, employee lawsuits and federal whistleblowers have been key in revealing a trail of SAIC failures to fulfill contract promises despite the river of taxpayer money. Still, there's a long road ahead for taxpayer satisfaction. Steele, interviewed for the magazine's "Contributors" blurbs, said, "There is no oversight; no one is watching the money, taxpayers' money."

You will hear more about this hugely powerful firm. Bartlett and Steele -- despite their intrepid digging -- have only scratched the surface. Write your members of Congress ... if they aren't on SAIC's payroll already.

1 comment :

  1. Good Post. I enjoyed your commentary.
    USA Today has recently reported in its Washington Section that the CIA plans to utilize more open sources and blogs in its intelligence work and outsource more of its intelligence software development to commercial contractors in an attempt to re-establish itself as the premiere world intelligence agency.

    The "Strategic Intent" is posted on the CIA public web site. Defense Industry Daily further reports that General Electric is gobbling up Smith's Industries for $4.8B.


    I am a 2 tour Vietnam Veteran who recently retired after 36 years of working in the Defense Industrial Complex on many of the weapons systems being used by our forces as we speak. Let's look at this for a moment and do our patriotic duty by reading along with the CIA (after all, they have announced they are reading this blog)

    1. The new CIA approach comes exactly at the formation of the agency’s new "External Advisory Board", which consists of the following:

    * A former Pentagon Chairman of the Joints Chief who is now a Northrop Grumman Corporation Board Member

    * A deposed Chairman of the Board of Hewlett Packard Corporation (HP)

    * A Former Deputy Secretary of Defense who now heads up a Washington think tank with Henry Kissinger

    2. Northrop Grumman Corporation and Hewlett Packard are two huge government contractors in the Pentagon and CIA custom software development arena. Their combined contracts with the government just for IT are in the multiples of millions. I wonder what the advisory board is filling the CIA's ear with?

    3. Washington "Think Tanks" are fronts for big time lobbies, sophisticated in their operations, claiming non-partisanship, but tremendously influential on K Street. If a lobby cannot buy its way in, why not sit on the advisory board?

    4. GE already has the military aircraft jet engine market. In buying Smith's, it takes one more major defense corporation out of the opposition and further reduces the government's leverage through competition. GE now joins the other monoliths such as Lockheed Martin, Boeing, General Dynamics, Northrop Grumman and Raytheon with tremendous leverage in the $500B +++ per year defense market.

    5. Note the synergy that now exists between the Pentagon and the CIA. Note the influence by the major corporations.

    6. Also note the balance in your bank account and your aspirations for the generations of the future. Both are going down.

    7. The huge Military Industrial Complex (MIC) continues to march. Taxes and national debt will be forced to march straight up the wall to support it. Do you have any "Intelligence” to offer the Pentagon, the CIA and the MIC? For further inspiration please see:



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