From: Paul Bullock (paulbullock@EBMS-LTD.CO.UK)
Date: Sun May 04 2003 - 17:53:21 EDT
Subject: Nine Members of the Defense Policy Board Have Ties to Defense Contractors > Special Report > Advisors of Influence: Nine Members of the Defense Policy Board Have > Ties to Defense Contractors > > By André Verlöy and Daniel Politi > Data by Aron Pilhofer > > Center for Public Integrity > > (WASHINGTON, March 28, 2003) Of the 30 members of the Defense Policy > Board, the government-appointed group that advises the Pentagon, at > least nine have ties to companies that have won more than $76 billion > in defense contracts in 2001 and 2002. Four members are registered > lobbyists, one of whom represents two of the three largest defense > contractors. > > The board's chairman, Richard Perle, resigned yesterday, March 27, > 2003, amid allegations of conflicts of interest for his > representation of companies with business before the Defense > Department, although he will remain a member of the board. Eight of > Perle's colleagues on the board have ties to companies with > significant contracts from the Pentagon. > > Members of the board disclose their business interests annually to > the Pentagon, but the disclosures are not available to the public. > "The forms are filed with the Standards of Conduct Office which > review the filings to make sure they are in compliance with > government ethics," Pentagon spokesman Maj. Ted Wadsworth told the > Center for Public Integrity. > > The companies with ties to Defense Policy Board members include > prominent firms like Boeing, TRW, Northrop Grumman, Lockheed Martin > and Booz Allen Hamilton and smaller players like Symantec Corp., > Technology Strategies and Alliance Corp., and Polycom Inc. > > Defense companies are awarded contracts for numerous reasons; there > is nothing to indicate that serving on the Defense Policy Board > confers a decisive advantage to firms with which a member is > associated. > > According to its charter, the board was set up in 1985 to provide the > Secretary of Defense "with independent, informed advice and opinion > concerning major matters of defense policy." The members are selected > by and report to the Under Secretary of Defense for Policy-currently > Douglas Feith, a former Reagan administration official. All members > are approved by the Secretary of Defense. The board's quarterly > meetings-normally held over a two-day period-are classified, and each > session's proceedings are summarized for the Defense Secretary. The > board does not write reports or vote on issues. Feith, according to > the charter, can call additional meetings if required. Notices of the > meetings are filed at least 15 days before they are held in the > Federal Register. > > ADDITIONAL RESOURCE > For additional information, visit the Web site of PBS' "Now With > Bill Moyers." > > The board, whose list of members reads like a who's who of former > high-level government and military officials, focuses on long-term > policy issues such as the strategic implications of defense policies > and tactical considerations, including what types of weapons the > military should develop. > > Michael O'Hanlon, a military expert at The Brookings Institution, > told Time magazine in November 2002 that the board "is just another > [public relations] shop for Rumsfeld." Former members said that the > character of the board changed under Rumsfeld. Previously the board > was more bi-partisan; under Rumsfeld, it has become more interested > in policy changes. The board has no official role in policy > decisions. > > The agendas for the last three meetings, which were obtained by the > Center, show a variety of issues were discussed. The Oct. 10-11, 2002 > meeting was devoted to intelligence briefings from the Defense > Intelligence Agency and other administration officials. One of the > first items on the agenda was an ethics brief by the Office of the > General Counsel. > > In December 2002, a two-hour intelligence briefing, strategy, North > Korea, and the Defense Advanced Research Projects Agency were on the > agenda. In February 2003, the topics discussed on the first day > included North Korea, Iran and Total Information Awareness, the > controversial Pentagon research program that aims to gather and > analyze a vast array of information on Americans. As the Center > previously reported, research for the program is being conducted by > private contractors. > > Richard Perle, who has been a very public advocate of the war in > Iraq, resigned the chairmanship of the Defense Policy Board after > being criticized in recent weeks because of his involvement in > companies that have significant business before the Defense > Department. He did not return the Center's phone calls. > > In a March 24 letter, Rep. John Conyers, the ranking Democrat on the > House of Representatives Judiciary Committee, asked the Pentagon's > inspector general to investigate Perle's role as a paid adviser to > the bankrupt telecommunications company Global Crossing Ltd. The > Hamilton, Bermuda-based company sought approval of its sale of > overseas subsidiaries from the Committee on Foreign Investment in the > United States, a government panel that can block sales or mergers > that conflict with U.S. national security interests. Rumsfeld is a > member of the Committee. > > Perle reportedly advised clients of Goldman Sachs on investment > opportunities in post-war Iraq, and is a director with stock options > of the U.K.-based Autonomy Corp., whose customers include the Defense > Department. > > "Mr. Perle is considered a 'special government employee' and is > subject to government ethics prohibition-both regulatory and > criminal-on using public office for private gain," Rep. Conyers wrote > in the letter obtained by the Center. > > > Potential conflicts not limited to Perle > > Perle, however, is not the only Defense Policy Board member with ties > to companies that do business with the Defense Department: > > Retired Adm. David Jeremiah, a former vice chairman of the Joint > Chiefs of Staff who served over 38 years in the Navy, is a director > or advisor of at least five corporations that received more than $10 > billion in Pentagon contracts in 2002. Jeremiah also sat on the board > of Getronics Government Solutions, a company that was acquired by > DigitalNet in December 2002 and is now known as DigitalNet Government > Solutions. According to a news report by Bloomberg, Richard Perle is > a director of DigitalNet Holdings Inc., which has filed for a $109 > million stock sale. > > Retired Air Force Gen. Ronald Fogleman sits on the board of directors > of companies which received more than $900 million in contracts in > 2002. The companies, which all have longstanding business > relationships with the Air Force and other Defense Department > branches, include Rolls-Royce North America, North American Airlines, > AAR Corporation and the Mitre Corp. In addition to being chief of > staff for the Air Force, Fogleman has served as a military advisor to > the Secretary of Defense, the National Security Council and the > President. He also served as commander-in-chief of the U.S. > Transportation Command, commander of Air Mobility Command, the 7th > Air Force and the Air Component Command of the U.S./ROK Combined > Forces Command. > > Retired Gen. Jack Sheehan joined Bechtel in 1998 after 35 years in > the U.S. Marine Corp. > > Bechtel, one of the world's largest engineering-construction firms, > is among the companies bidding for contracts to rebuild Iraq. The > company had defense contracts worth close to $650 million in 2001 and > more than $1 billion in 2002. Sheehan is currently a senior vice > president and partner and responsible for the execution and strategy > for the region that includes Europe, Africa, the Middle East and > Southwest Asia. The four-star general served as NATO's Supreme Allied > Commander Atlantic and Commander in Chief U.S. Atlantic Command > before his retirement in 1997. After his leaving active duty, he > served as Special Advisor for Central Asia for two secretaries of > Defense. > > Former CIA director James Woolsey is a principal in the Paladin > Capital Group, a venture-capital firm that like Perle's Trireme > Partners is soliciting investment for homeland security firms. > Woolsey joined consulting firm Booz Allen Hamilton as vice president > in July 2002. The company had contracts worth more than $680 million > in 2002. Woolsey told the Wall Street Journal that he does no > lobbying and that none of the companies he has ties to have been > discussed during a Defense Policy Board meeting. Previously, Woolsey > worked for law firm Shea & Gardner. He has held high-level positions > in two Republican and two Democratic administrations. > > William Owens, another former high-level military officer, sits on > boards of five companies that received more than $60 million in > defense contracts last year. Previously, he was president, chief > operating officer and vice chair of Science Applications > International Corporation (SAIC), among the ten largest defense > contractors. One of the companies, Symantec Corp., increased its > contracts from $95,000 in 2001 to more than $1 million in 2002. > Owens, who served as vice chairman of the Joint Chiefs of Staff, is > widely recognized for bringing commercial high technology into the > U.S. Department of Defense. He was the architect of the Revolution in > Military Affairs (RMA), an advanced systems technology approach to > military operations that represents a significant change in the > system of requirements, budgets and technology for the U.S. military > since World War II. Owens serves on the boards of directors for > several technology companies, including Nortel Networks, ViaSat and > Polycom. > > Harold Brown, a former Secretary of Defense under President Jimmy > Carter, and James Schlesinger, who has served as CIA director, > defense secretary and energy secretary in the Carter and Nixon > administrations, are two others that have ties to defense > contractors. Brown, a partner of Warburg Pincus LLC, is a board > member of Philip Morris Companies and a trustee of the Rand > Corporation, which respectively had contracts worth $146 million and > $83 million in 2002. Schlesinger, a senior adviser at Lehman > Brothers, chairs the board of trustees of the Mitre Corp., a > not-for-profit that provides research and development support for the > government. Mitre had defense contracts worth $440 million in 2001 > and $474 million in 2002. > > Chris Williams is one of four registered lobbyists to serve on the > board, and the only one to lobby for defense companies. Williams, who > served as a special assistant for policy matters to Defense Secretary > Rumsfeld after having been in a similar capacity for Sen. Trent Lott > (R-Miss.), joined Johnston & Associates after leaving the Pentagon. > Although the firm had represented Lockheed Martin prior to Williams' > arrival, the firm picked up two large defense contractors as clients > once Williams was on board: Boeing, TRW and Northrop Grumman, for > which the firm earned a total of more than $220,000. The firm lobbied > exclusively on defense appropriations and related authorization bills > for its new clients. Johnston & Associates is more often employed by > energy companies; its founder, J. Bennett Johnston, is a former > Democratic senator from Louisiana who chaired the Energy Committee. > > None of the members with ties to defense contractors responded to > requests for comment. > > The board's membership also contains other well known Washington > hands, including some who are registered lobbyists. Richard V. Allen, > a former Nixon and Reagan administration official, who is now a > senior counselor to APCO Worldwide, registered as a lobbyist for > Alliance Aircraft. > > Former Congressional representative Tillie Fowler joined the law firm > Holland & Knight in 2001. She served eight years in the U.S. House of > Representatives where she was a member of several committees > including the House Armed Services Committee and the Transportation > Committee. In 2002 she lobbied for such clients as the Minnesota > Department of Transportation and the American Plastics Council. > > Thomas S. Foley is a partner at Akin, Gump, Strauss, Hauer & Feld law > firm, which he joined in 2001. He was the U.S. ambassador to Japan > from 1997 to 2001 and was the Speaker of the House of Representatives > from 1989 to 1994, after being a representative since 1965. Foley is > a registered lobbyist, but has no defense clients.
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