Pentagon Spending Spree
The Wartime Opportunists on High Alert
by William Hartung
Multinational Monitor magazine, November 2001
Despite repeated assertions by President Bush and his top
advisers that their global campaign against terrorism will be
a "new kind of war," the biggest recipients of the new
weapons spending sparked by the September 11 attacks will be the
usual suspects: big defense contractors like Boeing, Raytheon,
Lockheed Martin and Northrop Grumman. Once emergency anti-terror
funding and supplemental appropriations to finance the war in
Afghanistan are taken into account, this year's Pentagon budget
could hit $375 billion, a $66 billion increase over last year.
Most of this new funding will be used to bankroll long-standing
pet projects of the military-industrial lobby, not to finance
equipment or techniques designed for the fight against terrorism.
As one Pentagon official told Defense News, much of the initial
anti-terror funding "will have nothing to do with retaliation
in response to the Sept. 11 attacks. The funding will go to the
[military departments'] wish lists for things we'll have several
years from now."
THE GREAT LEAP FORWARD
The arms industry's biggest agenda item of recent years -
a massive, across-the-board increase in military spending-has
taken a giant leap forward in the wake of September 11. In October
2000, in the stretch run of the presidential campaign, the National
Defense Industrial Association joined with other arms industry
trade groups and the corporate-backed Center for Security Policy
to finance a full page ad in USA Today touting a "4 percent
solution" to the nation's defense needs. Their "solution"
involved jacking up the Pentagon budget from 3 percent of gross
domestic product to 4 percent, which would involve an unprecedented
peacetime increase of $100 billion. The industry's rallying cry
has since been taken up by the Project for a New American Century,
a right-wing think tank founded by conservative luminary William
Kristol of the Weekly Standard.
Candidate George W. Bush's hard-line rhetoric on defense issues
raised high hopes among defense contractors. The industry rallied
behind the Republican ticket, giving more than four times as much
to the Bush campaign as they donated to Al Gore's presidential
bid, and favoring Republican candidates for Congress by almost
a two-to-one margin. But Bush dashed the arms makers' hopes for
a quick payoff in February 2001 when he announced that he would
not seek additional increases in Pentagon spending beyond those
already recommended by the outgoing Clinton administration until
Secretary of Defense Donald Rumsfeld had completed a comprehensive
review of U.S. military strategy.
Rumsfeld's review, with its early emphasis on the development
of lighter, more maneuverable conventional forces and a rapid
expansion of missile defense and military space programs, caused
additional anxiety for weapons firms. It appeared that the new
strategy might involve scaling back existing big-ticket programs
like Lockheed Martin's F-22 fighter plane and United Defense's
Crusader artillery system to make way for next generation systems.
For the major contractors, this would mean giving up lucrative
production contracts now for the promise of new projects down
the road, a tradeoff the industry did not want to make.
Rumsfeld's reform agenda ran into a brick wall on Capitol
Hill and in the military services, each of which had their own
weapons procurement priorities. By summer 2001, it appeared Rumsfeld
had backed off from the notion of making major cuts in existing
programs, and was banking instead on the prospect of instituting
substantial, long-term increases in Pentagon funding that could
accommodate missile defense and space weapons in addition to the
military's existing commitments to costly weapons projects that
had been designed during the Cold War era. But especially after
the $1.3 trillion Bush tax cut, Congress was reluctant to support
a massive peacetime military buildup. Even the first installment
on the Bush/Rumsfeld buildup, an $18.2 billion "amended increase"
to the FY 2002 Pentagon budget, ran into serious resistance on
Capitol Hill.
September 11 changed all that. Within days of the attacks,
Congress signed off on a $40 billion package for reconstruction
and anti-terrorism efforts, and many members echoed the sentiment
of Representative Norman Dicks, D-Washington, who argued that
prior notions of fiscal conservatism must be shunted to the side,
given the imperative of funding the fight against terrorism. Secretary
of Defense Rumsfeld has compared the war on terrorism to the Cold
War, and stock analyst Paul Nisbet has predicted that a $400 billion
military budget is now within reach. Boeing vice chairman Harry
Stonecipher told the Wall Street Journal that "the purse
is now open," so the Pentagon will no longer have to make
the "hard choices" among competing weapons projects
that were present prior to September 11. Lest anyone try to question
this flood of new military funding, Stonecipher warned that any
member of Congress who argues that "we don't have the resources
to defend America-won't be there after next November."
The main question now for the military-industrial lobby is
how to carve up this unexpected windfall.
BAILOUTS
The biggest beneficiaries of increased Pentagon spending will
be existing systems, many of which were designed during the Cold
War and have little or nothing to do with the fight against terrorism.
Representative Curt Weldon, R-Pennsylvania, will look to the
new surge in Pentagon spending as an opportunity to secure the
future of the troubled V-22 Osprey, built by Boeing in his Philadelphia
area district. The V-22, which is designed to take off and land
like a helicopter and fly like a plane, has been plagued by a
series of crashes that have killed 30 U.S. military personnel
and by a scandal involving falsification of maintenance records.
Last spring, a Pentagon "blue ribbon panel" recommended
slowing down the program until its serious technical problems
could be fixed, but the program's boosters have seized on the
war in Afghanistan as a rationale to speed up the program. Weldon,
who took over as the chair of the powerful subcommittee on military
procurement after the death of Representative Floyd Spence, R-South
Carolina, in August, will be well positioned to pump funding into
his pet project, which he has been promoting nonstop ever since
then-Secretary of Defense Dick Cheney tried to cancel it in the
first Bush administration.
Another major program that was widely considered to be on
the chopping block as recently as this spring was the United Defense
Crusader artillery system. When candidate George W. Bush spoke
on the campaign trail of building a new military defined "not
by mass or size, but by mobility and swiftness," the Crusader
was one of the weapons systems he had in mind for cancellation.
Critics believe that the 70 ton system is simply too heavy to
transport to distant battlefields, and would be difficult to maneuver
even if it could be delivered to a combat zone. But United Defense
has pledged to build an assembly plant for the Crusader in Lawton,
Oklahoma, which has garnered the project strong support from House
Majority Whip J.C. Watts, R-Oklahoma, and Senate Armed Services
Committee member James Inhofe, R-Oklahoma. If these Congressional
advocates aren't enough to get the job done, United Defense, which
is owned by the Carlyle Group, run by former Reagan Defense Secretary
Frank Carlucci, also has friends at the highest levels of the
Bush administration. Carlucci has already had a private audience
with his long-time friend Donald Rumsfeld since Rumsfeld took
over as secretary of defense, but he denies using the opportunity
to plug the Crusader. Other Carlyle associates include former
Secretary of State James Baker, who represented George W. Bush
in the Florida election fight, and former President George Herbert
Walker Bush, who makes overseas trips on behalf of the company
where he reportedly gives presentations for a fee of $100,000
each. With all this political firepower in its corner, United
Defense is poised to get more than its fair share of the coming
Pentagon windfall.
Lockheed Martin's F-22, an overweight, over-budget combat
aircraft that is now the most expensive fighter plane ever built
(at over $200 million per copy), should also fare well in the
new budgetary climate on Capitol Hill. Just two years ago, in
the fall of 1999, the company had to pull out all the stops in
a concerted lobbying campaign to restore production funding for
the program, which had been cut by influential committee members
John Murtha, R-Pennsylvania, and Jerry Lewis, R-California, due
to concerns over the F-22's burgeoning costs and continuing performance
problems. The F-22, which has been described by veteran defense
correspondent Greg Schneider as "a jet fighter with no one
left to fight," was originally designed to do battle with
a new generation of Soviet fighter planes which were never built.
Prior to September 11, Lockheed Martin was sufficiently concerned
about possible cuts in the 339-plane, $63 billion project that
the company had a special team of officials designated to drive
around the country with an F-22 flight simulator on the back of
an truck in order to generate local political support. Now the
plane appears safe from budget cuts.
Despite the fact that current generation U.S. combat aircraft
like the F-15 and the F-16 are far superior to the planes fielded
by any likely U.S. adversary, the costly F-22 is just one of three
major fighter programs now under way. Boeing's F/A-18 L/F program
is already in production for the Navy and Lockheed Martin recently
won a $19 billion long-term development contract for the Joint
Strike Fighter, a $200 billion program that will provide next
generation combat aircraft for the U.S. Air Force, Navy and Marines
as well as the armed forces of the United Kingdom. Although the
Pentagon claims that the decision to award the contract to Lockheed
Martin over Boeing was made on the merits, it is interesting to
note that the Bush administration's Secretary of the Air Force,
James Roche, spent most of the last two decades working for Northrop
Grumman and its predecessor, Northrop. Northrop Grumman is a major
participant in the Lockheed Martin Joint Strike Fighter team.
More money for the Pentagon may also provide an opening to
revive programs that have recently run their course, like Northrop
Grumman's B-2 bomber. Representative Dicks, whose hometown firm
Boeing is a major subcontractor on the project, raised the issue
of buying more B-2s in the very first meeting that President Bush
held with members of the congressional defense committees. Some
military "reformers" have championed the B-2 as well,
arguing that its long range could reduce U.S. dependence on overseas
bases in future conflicts. So far, the main problem in restarting
the B-2 program has been cost. The first 21 planes cost $2 billion
each. Funds permitting, Secretary of Defense Rumsfeld is reportedly
considering purchasing another 40 B-2s for "only" $735
million each. With B-2s running bombing missions in Afghanistan
and tens of billions of dollars pouring into the Pentagon, the
B-2 lobby's odds of reviving the project are looking better every
day.
PROPPING UP MISSILE DEFENSE
Despite the fact that the September 11 attacks underscored
the fact that a ballistic missile armed with a weapon of mass
destruction is by far the least likely way a foreign power or
terrorist group would choose to attack the United States, Congressional
backers of the Bush administration's missile defense plan are
intent on moving full speed ahead nonetheless. The United States
has extracted an agreement in principle from Russia to accept
new, more flexible "interpretations" of the Anti-Ballistic
Missile Treaty of 1972 to permit ongoing missile defense testing
beyond what would have been allowed under the letter of the agreement.
This is good news for the big four missile defense contractors
-Boeing, Lockheed Martin, Raytheon and TRW-which have split roughly
two-thirds of all missile defense research funding over the past
few years and are looking forward to getting the lion's share
of the $120 billion to $240 billion that it will cost to deploy
the multi-tiered missile defense shield favored by the Bush administration.
Meanwhile, the Democratic opposition to missile defense, such
as it was, has been temporarily silenced in the wake of September
11. Under pressure to show "unity" in a time of national
crisis, Senate Armed Services Committee Chair Carl Levin, D-Michigan,
withdrew an amendment that would have limited the administration's
ability to conduct missile defense tests that violate the ABM
Treaty without consulting Congress. Levin also allowed a $1.3
billion cut in the administration's $8.3 billion missile defense
research spending in the 2002 budget to be restored.
While missile defense critics in Congress have been holding
their fire, the missile defense lobby continues its efforts unabated.
The corporate-backed SAFE Foundation (Safeguarding America For
Everyone) has accelerated its National Missile Defense education
campaign in the wake of September 11, even going so far as to
put a picture of the charred ruins of the World Trade Center front
and center on its web site as an attention-getter for its pro-missile
defense propaganda. Board members of the foundation include Representative
Weldon and Dean J. Garritson, a vice president of the National
Association of Manufacturers.
The National Defense University Foundation and the National
Defense Industrial Association are continuing their ongoing series
of missile defense "breakfast briefings" on Capitol
Hill. Not only is the series supported by the arms industry's
largest trade association, NDIA, but each breakfast receives support
from a specific corporation like Bechtel or Lockheed Martin. Meanwhile,
Raytheon has hired former House Appropriations Committee Chair
Bob Livingston, R-Louisiana, to make the case for missile defense
on Capitol Hill, while Boeing has hired top-flight lobbying firms
Bonner and Associates and Powell Tate for its missile defense
push. Missile defense lobbyists will get a sympathetic hearing
within the Bush administration, which has placed veterans of the
missile defense lobby in key positions. Secretary of Defense Donald
Rumsfeld is a long-time associate of and contributor to the Center
for Security Policy, a pro-Star Wars advocacy group that has received
over $2 million in corporate contributions from the likes of Boeing
and Lockheed Martin, among others. Douglas Feith, Rumsfeld's under
secretary of defense for policy, is a former chair of the organization's
board. Albert E. Smith, who used to run Lockheed Martin's space
operations, has been appointed as undersecretary of the Air Force
in charge of all military/space acquisitions. And the new head
of the Joint Chiefs of Staff, General Richard Myers, the former
head of the U.S. Space Command, is a long-standing advocate of
militarizing outer space. Rumsfeld has also turned to self-interested
corporations to shape his vision of future military uses of outer
space: a commission he chaired on the subject that released its
findings in early 2001 included no fewer than eight representatives
of companies working on space technology and missile defense for
the Pentagon.
LAST AND LEAST: MONEY FOR ANTI-TERROR WEAPONS
A small portion of the Pentagon's new windfall will actually
be spent on weapons with applications to the war on terrorism.
At a September 24 speech to the Heritage Foundation, Pentagon
Comptroller Dov Zakheim indicated that the department would step
up funding for pilotless aircraft like the Northrop Grumman Global
Hawk, surveillance/intelligence aircraft like the RC-135 "Rivet
Joint," and precision missiles and munitions like the Raytheon
Tomahawk cruise missile and the Boeing Joint Direct Attack Munition
(JDAM), But these expenditures will be dwarfed by the billions
destined for Cold War relics like the F-22 fighter and schemes
like the president's missile defense plan. z Even these outlays
miss the larger point: there is no effective military response
to terrorism. Diplomacy, intelligence gathering, cutting off
financial assets of terror groups and other cooperative initiatives
are far more likely to have an impact than raining bombs down
on Afghanistan or the next nation that may be targeted for "harboring
terrorists." But the lobby for utilizing non-military tools
to fight terrorism is not as well funded or as mobilized as the
arms lobby.
William D. Hartung is the director of the Arms Trade Resource
Center at the World Policy Institute at the New School for Social
Research in New York.
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