The nexus between big business and government is an ever-tightening one. It’s an area I’ll be covering in a forthcoming book (due in a while). Just this week has seen a litany of media stories that highlight the inherent problems. More wars and detention to maximise profits? You better believe it.
Some of the world’s biggest weapons manufacturers and arms dealers are among companies to have wined and dined Defence executives and military officers, internal government records show.
The records shine a light on the relationship between the Defence industry’s big hitters and the military, with more than 110 free dinners, lunches, theatre and football tickets given to the Defence Department’s three-star personnel from a range of companies in the past three years.
The recently retired head of the Chief Capability Development Group, Vice-Admiral Matt Tripovich, enjoyed more hospitality than any other senior official – accepting almost one-quarter of all such events taken up by senior levels of the Australian defence establishment.
Admiral Tripovich, responsible for securing cabinet approval to buy new multimillion-dollar weapon systems, benefited from 28 invitations to dinners, concerts, the theatre and rugby Tests.
And the federal government’s second-most senior arms buyer, Warren King, is another prolific luncher, accepting 25 invitations from companies seeking defence contracts.
These ranged from a private dinner in July with Jim McDowell, the chief executive of BAE Systems, the world’s wealthiest arms dealer, to a cocktail function hosted by the electronics group Thales at the Australian War Memorial in December 2007.
Mr King is the deputy chief executive of the Defence Materiel Organisation, and a former senior executive at Raytheon, another major arms supplier that has provided hospitality to senior Australian Defence officials.
A security company has recruited two former senior civil servants, sparking an outcry about the “revolving door” between Whitehall and the company.
G4S, formerly Group 4 Securicor, hired Dr Peter Collecott, the one time director of corporate affairs at the Foreign Office, and David Gould, the Ministry of Defence’s former chief operating officer in charge of defence equipment, according to a government report.
The company, whose guards are under investigation over the death of deportee Jimmy Mubenga, supplies armed guards for embassy staff around the world. It has recruited former ministers including Lord Reid as well as senior figures in offender management.
The disclosure comes two weeks after Sir George Young, the leader of the Commons, said he would examine the “revolving door” between Whitehall and defence companies.
The New York Times published on Christmas Eve a story exposing nearly 300 US companies that hold special export licenses allowing them to do “billions of dollars in business with Iran and other countries blacklisted as state sponsors of terrorism.”
The companies include such household names as Pepsi, General Electric and Bank of America. The countries include such international pariahs as Sudan, Burma, North Korea and Zimbabwe.
With a little database work, I filled in one missing facet of the story. At least 83 of the companies listed by the Times as having multiple special export licenses are Department of Defense contractors.
Regardless of whether you agree with the policy of blacklisting, or its particulars, it’s hard to understand why the US government would allow top military contractors to cut deals with declared adversaries. The Times reports that many of the special licenses “were deemed to serve American foreign policy goals”—whatever that means. Other exemptions were inexplicable except perhaps as kickbacks.
An hour after the official ceremony marking the end of his 35-year career in the Air Force, General Gregory “Speedy’’ Martin returned to his quarters to swap his dress uniform for golf attire. He was ready for his first tee time as a retired four-star general.
But almost as soon as he closed the door that day in 2005 his phone rang. It was an executive at Northrop Grumman, asking if he was interested in working for the manufacturer of the B-2 stealth bomber as a paid consultant. A few weeks later, Martin received another call. This time it was the Pentagon, asking him to join a top-secret Air Force panel studying the future of stealth aircraft technology.
Martin was understandably in demand, having been the general in charge of all Air Force weapons programs, including the B-2, for the previous four years.
He said yes to both offers.
In almost any other realm it would seem a clear conflict of interest — pitting his duty to the US military against the interests of his employer — not to mention a revolving-door sprint from uniformed responsibilities to private paid advocacy.
But this is the Pentagon where, a Globe review has found, such apparent conflicts are a routine fact of life at the lucrative nexus between the defense procurement system, which spends hundreds of billions of dollars a year, and the industry that feasts on those riches. And almost nothing is ever done about it.
The Globe analyzed the career paths of 750 of the highest ranking generals and admirals who retired during the last two decades and found that, for most, moving into what many in Washington call the “rent-a-general’’ business is all but irresistible.
From 2004 through 2008, 80 percent of retiring three- and four-star officers went to work as consultants or defense executives, according to the Globe analysis. That compares with less than 50 percent who followed that path a decade earlier, from 1994 to 1998.
In some years, the move from general staff to industry is a virtual clean sweep. Thirty-four out of 39 three- and four-star generals and admirals who retired in 2007 are now working in defense roles — nearly 90 percent.