On April 9, 2014 an advance release of a report by professors Martin Gilens and Benjamin Page titled, Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens declared that ordinary American citizens have little or no independent influence on policy, and rather than operating as a system of “Majoritarian Electoral Democracy” or “Majoritarian Pluralism”, the United States functions as a system of “Economic Elite Domination” or “Biased Pluralism”.  Within days the story had been picked up by most major news organizations and entered the spheres of both politics and pop culture.  Gilens and Page appeared on Comedy Central’s The Daily Show, and the report was referenced by Senator Bernie Sanders during his questioning of Federal Reserve Chair Janet Yellen during a Joint Economic Committee Hearing.

The study looked at 1,779 policy issues between 1981 and 2002 that resulted in policy change in the United States and measured support or resistance to the policy by four groups: “quite poor”, “median”, “fairly affluent” and  “interest groups”.  While finding that ordinary citizens had virtually no influence on policy, the report found that the opinions of elite citizens have a significant impact on policy, while the opinions of organized interest groups have a substantial influence on US policy.  Further, the report concluded that generally, the desired outcome of interest groups did not align with the preferences of the average citizen, or even affluent citizens and that this likely reflected, “profit-making motives among businesses as contrasted with the broader ideological views among elite individuals.”

These findings underline the sense that profit may fuel important decision-making by the US government.  In the realm of security and defense, this influence is often discussed in terms of the military-industrial complex and its influence over US spending and policy decisions.

Much has been written to slander or raise concern over the military industrial complex.  The very name conjures an image of physically or figuratively large men in suits conspiring in a dark room where money and decisions are made in secret.  The reality is less sinister, but may somehow be more disturbing.  There is no need for a dark room or whispering.  A revolving door between the military and military contracting companies operates in broad daylight and with general acceptance, but questionable control and oversight.

A December 2010 article from the Boston Globe reported that between 2004 and 2008, 80% of retiring three- and four-star officers went to work as consultants or defense executives, while a 2008 report by the Government Accountability Office found that 52 defense contractors employed 86,181 of the 1,857,004 civilian and military members of the Department of Defense (DoD) who left employment with the DoD after 2001. 2,435 of these 86,181 were senior officials with control over programs, acquisition, and contracting. In many ways, this pattern of employment is logical: civilian and military employees of the DoD possess expertise and knowledge that qualifies them for positions with defense contractors, and interaction between DoD departments and defense contractors create a common network and contacts that, in any other field, would be equally exploited for employment opportunities.

But, considering the hundreds of billions of dollars involved and the issues of national security and public interest at stake, this cozy relationship between DoD and military contractors deserves deeper consideration.  Former high ranking military officials working in private defense positions may have privileged access to information on government defense procurement plans, or access to high level government and congressional meetings that are otherwise closed to defense contractors for ethical reasons.  After retirement, former military officers can simultaneously work as consultants for defense contractors, and continue to serve in advisory roles on Pentagon projects and committees.  Personal relationships with members of congress may leave former DoD officials with disproportionate influence on congressional defense spending decisions.

The 2008 GAO report shows that of the 2,435 top officials employed by defense contractors, 65% were hired by seven contractors: Science Applications International Corporation (SAIC), Northrop Grumman, Lockheed Martin Corporation, Booz Allen Hamilton, Inc., L-3 Communications Holding, Inc., General Dynamics, and Raytheon Company.  These same 7 contractors top the list in terms of the total value of contracts awarded by DoD, and four of these companies also appear in the top ten list of companies receiving contracts in the intelligence industry based on a report of the US Special Operations Command (USSOCOM) published by the Remote Control Project.

Current legislation places minimal restrictions on the private employment of retired DoD officials.  DoD officials and senior Pentagon officials handling contracts worth more than $10 million are required to seek an ethics opinion if they intend to work for a defense company within 2 years of their retirement, but this ethics opinion has no authoritative or binding power.  U.S legal codes stipulate that former DoD employees should allow a cooling off period before seeking employment with defense contractors.  The designated time of these cooling off periods depends on the nature of the DoD work performed.  Former DoD employees are not meant to consult on proposals to agencies with which they were formerly employed, if they were personally or substantially involved in decision making or procurement.  However, organized and institutionalized tracking of the specific employment and project backgrounds of contractors is performed by neither the DoD nor defense contractors.  Contractors are not required to disclose to private defense companies, all of their previous or current contracts.

The revolving door system and gaps in the oversight of this system raise complex questions. Does this exchange between the Department of Defense and defense contracting companies have tendencies that create an economy of influence or lend themselves to waste?  Does the system create a conflict of interest or at least the appearance of a conflict of interest that could result in a public loss of faith in government spending decisions?  These possibilities warrant a wider discussion on mechanisms for monitoring and controlling the system, such as those raised by GAO in their report : that contractors be required to disclose all contracts under which they are working, that private defense firms have access to DoD ethics recommendations before hiring employees, and that DoD officials track the specific procurement and acquisition background of former employees and certify that these former employees were not involved in the awarding of contracts to defense firms during their time at the DoD, before new contracts are awarded.

The first two graphs below are taken from the previously mentioned GAO report, Defense Contracting: Post Government Employment of Former DoD Officials Needs Greater Transparency.  The first graph lists the defense firms that hire the most former DoD officials while the second graph shows the highest dollar value contracts between defense firms and the  DoD in 2005.  Similarly the third graph is supplied by the Remote Control Project and shows the highest dollar value contracts between the USSOCOM and defense contractors.

GAO 1

GAO 2

Notes: Total dollar values of DOD contract awards in 2005 for each contractor were rounded to the nearest million. Amounts for each contractor added together do not match the subtotal due to rounding.

USSOCOM 1

Source: Remote Control: US Special Operations Command Contracting: Data-Mining the Public Record

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