The Military Industrial Complex With A Vengeance

If you suspect that the Bush administration represents a potential return to a Cold War mentality and a boon to the defense industry you are not alone. In fact, we expressed such a concern, in our editorial "Concerned About Cheney" immediately before it was announced that then-Texas Governor George W. Bush had selected Dick Cheney as his running mate. While it would be incorrect to depict the Bush-Cheney administration as a "return" of the military-industrial complex, it is not a stretch to say that this administration represents an increase in influence and intensification of the power of the military-industrial complex.

Or one may choose to call it " The Military Industrial Complex With a Vengeance", as William Hartung, Director of The Arms Trade Resource Center at the World Policy Institute, referred to it in a recent discussion with

Hartung believes that while weapons contractors and technology firms had considerable influence in the Clinton administration, the Bush administration represents a boon to the defense industry.

"If you look at the administration, at the highest levels, you can readily see the direct connections. You have a vice-president in Dick Cheney who was head of an oil/energy company - Halliburton. You have a chief of staff in Andrew Card who was the former chief lobbyist for the auto industry, you have a former joint chiefs of staff as Secretary of State in Colin Powell and you have a Secretary of Defense in Donald Rumsfeld, who served in that exact same position over 20 years ago, who knows more about the bureaucracy of the Defense establishment than practically anyone. The things that the defense industry could not get Clinton to do, this group will do with enthusiasm." he said.

But make no mistake about it. This version of the military-industrial complex, which represents the interlocking relationship between the US military, in key power centers, and the private sector which performs the research, and designs and sells the weapons used by the US armed forces, is nothing like the 1960s version.

The nuances are more plentiful and more difficult to detect and not everyone in the Defense community is going to benefit equally from the Bush administration's largesse.

In fact, there may be some short-term losers if President Bush stays committed to his intention to hold military spending steady at $310 billion. Many in the defense community were shocked and disappointed by President Bush's decision, apparently underestimating Bush's commitment to make tax cuts and education spending his highest priorities.

Bush has held the most zealous of generals and defense contractors at bay by assigning Defense Secretary Rumsfeld to perform a review of the structure of the US military as well as its spending priorities.

Some see Rumsfeld's review, which may take several months, as nothing more than a public relations exercise that will be used to justify an increase in defense spending down the road, that Bush could not sell today.

But others think that the Rumsfeld review poses a real threat to various sectors of the military industrial complex and justifiably so.

In an op-ed in yesterday's Washington Post, entitled, "Improving The Business End Of The Military",Warren B. Rudman, former Republican senator from New Hampshire and Josh S. Weston retired chairman and CEO of Automatic Data Processing Inc. wrote of the enormous waste and fat that exist in the military's budget and the challenge that lies before Rumsfeld.

They wrote:

"As things now stand, a remarkable 70 percent of the $300 billion defense budget is devoted to overhead and infrastructure. Only 30 percent directly funds combat forces. Just as no community would tolerate seven out of every 10 police officers sitting at their desks doing paperwork rather than fighting crime, the nation should not tolerate such a ratio in the armed forces. …The (Defense) department's cumbersome and costly acquisition system cries out for commercial innovations. Everyone is wondering whether the new administration will continue major systems such as the Joint Strike Fighter. By including acquisition reform in his current review, Defense Secretary Donald Rumsfeld has recognized that just as important as what you buy is how you buy it. His challenge is not just whether to spend more but how to spend smarter….Rumsfeld's laudable effort to transform the world's largest organization will face institutional inertia and vested interests."

Even the so-called Big Five defense companies: Boeing, General Dynamics, Lockheed Martin, Northrup Grumman, and Raytheon do not stand to benefit in the traditional manner under the Bush administration.

That is largely because the needs of the military have changed in a manner that makes the military increasingly dependent upon smaller more technology-related firms. In addition, Bush's advocacy of specific military projects has positioned the military budget to move in a manner that favors some firms over others.

This reality was addressed in a recent cover story in Barron's magazine, which sifts through the nuances of the new defense industry landscape. The author of the story "Starship Troopers", Erin E. Arvedlund wrote:

"When the time comes to spend more on defense, the defense contractors that stand to gain are those that specialize in the kind of high-tech weaponry portrayed in (Tom) Clancy's thriller (The Bear and the Dragon). TRW, for example, makes laser guns that can be mounted on trucks and used to shoot down rockets. Then there's Alliant Technologies, the leading U.S. supplier of ammunition, which is ready to arm a new generation of fighter aircraft. In addition, the Pentagon's need to up grade computer systems is likely to benefit companies such as EDS and Cisco.

Perhaps the biggest undertaking advocated by Bush is a national missile defense system that would blast enemy rockets out of the sky shortly after they lift off. That program could cost anywhere from $30 billion to $50 billion. If the system is approved, one of the chief winners would be Boeing, which has been chosen as the lead contractor. That could mean as much as $6 billion in revenue for Boeing over the next six years.

One of the toughest decisions facing Rumsfeld concerns fighter planes. The most advanced, the F-22 Raptor, is made by Lockheed Martin. But it is possible that the F-22 will be abandoned in favor of a Joint Strike Fighter, to be used by all branches of the service and cost "only" $30 million to $40 million each.

Choosing the Joint Strike Fighter would benefit Boeing, but it could hurt Lockheed if the program is chosen at the expense of continuing production of the F-22. The damage would be partly ameliorated by the fact that Lockheed would be a junior partner to Boeing in making the Joint Strike Fighter, however."

Hartung does not buy the argument that Bush is actually considering reducing military spending or that the president is really trying to reduce the influence of the military-industrial complex. Rather, Hartung sees the Rumsfeld review as serving a dual purpose in that it enables Bush to buy time before he increases military spending as well as allowing the president to place his own imprint on the armed forces.

"The review does not demonstrate so much that Bush is a peace maker. It does show that he is making sure that the US military is his and reflects his priorities rather than those of others inside of the Defense bureaucracy or influential Senators like Trent Lott (R-Ms.)" Hartung said.

Another danger that Hartung sees with the new administration is that it appears to be a bit trigger happy, as evidenced by the recent bombing in Iraq, as well as antagonistic, at times, toward other nations. At the same time, Hartung notes, the administration, primarily through Bush and Powell, attempts to give the impression that it is doing all it can to avoid conflicts and heightened tensions between the US and others.

"It seems like they really are doing their best to revive the Cold War and then, it appears that they are talking out of both sides of their mouths. The administration constantly reiterates that no one has anything to fear from the US and then almost daily, they are making new charges and allegations against China and Russia. At times, it seems that they feel no need to dialogue with Russia, China and even, at times, Europe. They feel it isn't necessary because the US has bigger guns", Hartung pointed out.

Hartung believes that the administration may actually create scenarios that justify increased military spending and even combat. He said,"They are more comfortable in an environment of crisis. An era of peace reduces their leverage. There is always a danger that this administration may overact and hype up relatively minor conflicts in order to help create the environment that they are most comfortable with."

Hartung also stated that he feels that the strongest moderating influence in the Bush cabinet is Colin Powell, adding, " Rumsfeld and Cheney are more in tune with the hard core aggressive right-wing defense ideologues like Frank Gaffney. Powell is more pragmatic and less enamored with Star Wars and a few years ago he even signed a letter in support of a nuclear test ban, which Cheney and Rumsfeld would never do. Powell is still militaristic but he is much more pragmatic than Cheney and Rumsfeld, and in that manner he may provide a counter balance, but he is definitely surrounded by more knee-jerk right-wing reactionaries."

Overall, Hartung thinks that having so many people in the Bush cabinet with direct ties to the military-industrial complex does have a benefit for the general public because it makes the activities and motivations of all of the key players in the administration more transparent.

Hartung says, "With these guys having such obvious connections to defense and oil companies, the veil has been lifted and more information comes to light. This is good. They can't posture like Clinton did because they have such blatant special interests."

Hartung's point is well taken.

As an example, one only needs to consider the Carlyle Group, a $12.5 billion global equity investment firm owned by both former Secretary of State and Bush's Florida vote-counter, James Baker, and former Defense Secretary Frank Carlucci. According to Barron's:

"Carlyle's combined stake in privately held defense companies like Lear Siegler Services; U.S. Marine Repair; United Defense Industries; Aerostructure, and Vought Aircraft qualify it as the nation's 11th-largest defense contractor. About one-third of Carlyle's buyout business is in defense; a third of it is in telecom and the remaining third is in various industries. Vought is a supplier to the B-2 bomber and United Defense is developing the self-propelled Crusader howitzer for the Army."

The James Baker-Carlyle connection certainly makes the former Secretary of State's involvement in the Florida recount that much more interesting and maybe easier to understand.

It is business as usual for the military-industrial complex and it looks like we will see more of it in the future.

Cedric Muhammad

Thursday, February 22, 2001