Fw: Nine Members of the Defense Policy Board Have Ties to Defense Contractors

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

> 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.
>   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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