Cont'd
Then there's SAIC, a huge high-tech firm, which receives more contracts from the government than any other company. It translates and decodes intercepts for the NSA, provides the CIA with computer software to analyze intelligence data, and has a variety of contracts working on the Star Wars missile defense program. SAIC's board members have included two former defense secretaries-William Perry and Melvin Laird- and three former heads of the CIA-John Deutsch, Bobby Ray Inman, and Robert Gates. Most top positions at the firm are filled by retired military officials, spooks, former Congressional staffers and employees of federal agencies
In the years immediately following World War 11, military officers did not commonly go to work for defense companies upon retiring from active duty (with the exception of the Air Force, which has always been the most corrupt service branch). There was a social stigma about using influence and knowledge attained while serving one's country as tools of profiteering. Today, such inhibitions have all but disappeared.
Ernie Fitzgerald is the Air Force official who was fired by President Nixon because he blew the whistle on cost overruns on Lockheed's G130. Fitzgerald sued to get his job back and was reinstated four years later following a long court battle. Fitzgerald is still at the Pentagon and is as crotchety as ever about the corruption there. Here's how he explains the inner workings of the revolving door
Military officers for the most part are forced to retire when their family expenses are at a peak-they've got a couple of kids in college and they're still paying a mortgage. They won't starve on their retired pay. But at the same time they can't keep up their lifestyle. What happens in our system is that the services see one of their management duties as placing their retired officers, just like a good university will place its graduates. And the place the services have the most influence at is with the contractors.
If you're a good clean-living officer and you don't get drunk at lunch or get caught messing around with the opposite sex in the office, and you don't raise too much of a fuss about horror stories you come across-when you retire, a nice man will come calling. Typically he'll be another retired officer. And he'll be driving a fancy car, a Mercedes or equivalent, and wearing a $2,000 suit and Gucci shoes and Rolex watch. He will offer to make a comfortable life for you by getting you a comfortable job at one of the contractors.
Now, if you go around kicking people in the shins, raising hell about the outrages committed by the big contractors, no nice man comes calling. It's that simple.
Sell, Sell, Sell: Lobbyists and Foreign Arms Sales
A particularly illuminating case of the revolving door in action is that of retired Lt. Gen. Howard Fish. A former Pentagon staffer I interviewed says Fish worked in the Pentagon for decades but always as a staff officer. "He never commanded anything in his life," this person says. "He was one of the all-time champions of service in the Pentagon, always holding ass-kissing positions."
During the Nixon and Ford administrations, Fish headed the Defense Security Assistance Agency (DSAA), the Pentagon bureau that handles foreign military sales and one of the more corrupt components of the military establishment. The DSAA has a field staff of about 1,000 people who work out of the U.S. embassy in some 15 countries. They offer everything from briefings on weapons systems to demonstrations of major aircraft, in addition to arranging the financing needed to close a deal.
The DSAA receives a 3 percent commission per sale- which provides about 80 percent of its operating budget-and agency personnel are promoted on the basis of the* ability to move weaponry. Due to this dynamic, says a 1991 report from Congress's now defunct Office of Technology Assessment, "there is powerful incentive for DSAA personnel to make as many sales as possible."
As head of the DSAA, Fish was an exuberant promoter of selling weapons to any and all buyers. According to William Hartung of the World Policy Institute, Fish played a key role in watering down the Arms Export Control Act of 1976, which would have placed a ceiling on total foreign arms sales and given Congress the right to veto sales on human rights grounds.
During the early 1970s, Fish was among several officials who were found to have passed sensitive information about contractual matters to several big arms makers, including Lockheed and LTV Aerospace & Defense. The information was of great use to the arms makers, as it involved plans for overseas sales and information about what weapons systems might be targeted for cuts. The affair caused a huge scandal inside the Pentagon, but Fish escaped censure.
At roughly the same time Fish became heavily involved in sales to Iran, then headed by the Shah. Iran was seen as an enormous cash cow for the Pentagon and the arms makers. The environment surrounding the arms trade was so corrupt that even the Shah became incensed, especially about American "brokers" for U.S. companies who were running around Iran and receiving huge commissions on deals they arranged. When the Shah sought to eliminate bribes and fees paid to these brokers, Fish fought him every inch of the way, claiming that this would impinge on the flexibility contractors needed to close deals.
Later in the decade Fish began to take a keen interest in Egypt, as that nation was coming on-line as a major buyer of U.S. weaponry. As a result of the 1978 Camp David accords, Egypt was to receive $1 billion per year in military aid. To ship weapons to the Egyptians, the Pentagon signed an exclusive contract with a company called Eatsco, which was formed by an Egyptian government official named Hussein K. Salem and a retired CIA official named Thomas Clines, who later played a prominent role in the Iran-Contra scandal. A third principal, though a silent one, was Edwin Wilson, the retired CIA agent who at the time was living in Libya and providing military equipment and training to the government of Muammar Quaddafi. Wilson is currently serving a 52-year prison term for arranging shipments of explosives to Quaddafi, and for subsequent attempts to kill witnesses against him.
It later turned out that Eatsco had overbilled the Pentagon by $8 million on shipments to the Egyptians. In one case, Eatsco billed the government $1.3 million for a shipment that cost about half that much. The mark-up increased further on a $46,409 shipment for which Eatsco billed the government $210,904.
It also turned out that Eatsco had two additional principals, both silent partners who worked inside the government. The two were Fish's closest cronies at the Pentagon, Richard Secord, later another big player in the Iran-Contra affair, and Erich von Marbod, who served as Fish's second in command at the DSAA. Secord and von Marbod were forced to retire from the Pentagon as a result of the Eatsco affair, though the cause was hushed up.
Fish's work at the Pentagon provided him with the perfect resume when he decided to retire from government in the late 1970s. He quickly found work with LTV-one of the two firms he had provided classified information to a few years earlier. Within months of his resignation he turned up in Malaysia, where he was hawking A-7 fighters. Fish also hired von Marbod to work at LTV's Paris offices.
Fish later worked as the head of international marketing for Loral, another big weapons maker, and then took charge of the American League for Exports and Security Assistance (ALESA) in the late 1980s. The latter outfit is one of the many powerful trade groups formed by arms makers-others include the Aerospace Industries Association and the American Defense Preparedness Association-to lobby for higher military outlays at home and greater U.S. military involvement abroad.
One of Fish's chief missions has been promoting the sale of weapons to the Middle East, especially to Saudi Arabia where Fish has intimate connections (he kept a picture of Saudi King Fahd on a bookcase at his office). Back in 1989, Fish met with chief of staff John Sununu and National Security Advisor Brent Scowcroft in a successful effort to convince the Bush administration to sell frontline tanks and supersonic fighters to Arab countries.
An impressive display of the ALESA's efforts came in the early 1990s, when at the behest of weapons makers it helped form the Middle East Action Group to press for deals then in the pipeline with the Saudis. Other members of the coalition included GE, Ford, Bechtel, Boeing, and the U.S.-Arab Chamber of Commerce
In addition to Fish, the Action Group also retained the services of a number of high-powered consultants with links to the Saudis. These include:
Dov Zakheim, a former deputy defense undersecretary for Reagan, chief defense adviser to Bob Dole during the 1996 presidential campaign and head of a consulting firm called SPC International. Zakheim is an ordained rabbi with close ties to the American Jewish community. His great credibility with the pro-Israel lobby makes Zakheim especially useful to arms makers lobbying for sales to Arab countries.
Sandra Charles served on the National Security Council as director for Middle East Affairs during the Bush years. After retiring, she formed a consulting firm, C&O Resources, which handles foreign policy analysis, business development, and arms sales to the Middle East, including Saudi Arabia."
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