This is the first in an occasional series on the unprecedented waste and massive, if largely unreported, corruption engendered by the military-industrial complex of the United States, whose government spends about $1 trillion a year on defense-related purposes.
Acknowledgment first: Lockheed, now the biggest munitions contractor, sent me to college on a full scholarship, gave me summer jobs at its aircraft plant in my home town, Marietta, Georgia, and, on graduation day, offered me a permanent job. I chose a different direction. Even so, decades later, people hearing a bit of that story say, “Oh! Are you Martin of Lockheed Martin?”
I feel little temptation to pass myself off as royalty in the giant octopus that President Dwight D. Eisenhower called the military-industrial complex. You can’t be too careful to avoid showing even a hint of what might be interpreted as conflict of interest.
Ike, after all, was talking about the beginnings of what has metastasized into the ubiquitous corruption machine that designs and manufactures planes that don’t fly right; produces massive cost overruns on everything; provides assurances of lucrative post-retirement jobs for military personnel …. We could go on and on.
Which brings us to Mark Esper, one of those former military personnel – a West Pointer and 1st Gulf War infantry officer – and now President Donald Trump’s latest defense secretary. Esper announced Wednesday he was recusing himself from an investigation Trump had assigned him to conduct, into an enormous Pentagon procurement project called Joint Enterprise Defense Infrastructure.
You can figure out the Star Wars acronym for the project, which started as a four-way bidding war and came down to pit just two tech giants, Amazon and Microsoft, against each other with a potential $10 billion payoff going to the winning bidder – zero to the loser – for the cloud computing project.
Amazon’s current and previous competitors “are saying it wasn’t competitively bid,” Trump was quoted as having said July 18 at the White House. “Some of the greatest companies in the world are complaining about it.” The president wanted the Pentagon “to look at it very closely to see what’s going on because I have had very few things where there has been such complaining.”
Here’s what the Pentagon said in a press release about Esper’s withdrawal: “Soon after becoming Secretary of Defense in July, Secretary Esper initiated a review of the Department’s cloud computing plans and … the JEDI procurement program. As part of this review process he attended informational briefings to ensure he had a full understanding of the JEDI program and the universe of options available to DoD to meet its cloud computing needs.”
However, the press release continues, “although not legally required to, he has removed himself from participating in any decision making following the information meetings, due to his adult son’s employment with one of the original contract applicants. Out of an abundance of caution to avoid any concerns regarding his impartiality, Secretary Esper has delegated decision making concerning the JEDI Cloud program to Deputy Secretary [David] Norquist. The JEDI procurement will continue to move to selection through the normal acquisition process run by career acquisition professionals.”
His sudden recusal would seem pretty weird to anyone who followed Esper’s Senate confirmation hearing. His predecessor as acting defense secretary, Patrick Shanahan, had agreed to recuse himself from matters concerning Boeing, Shanahan’s former employer – the number two defense contractor, and the maker of those deadly aircraft.
Esper, however, refused to do the same regarding Raytheon, the number four contractor. He had worked for the company as a high-powered lobbyist for seven years until – following service on a Trump campaign committee of businessmen – he resumed government employment in 2017 as secretary of the army.
According to a disclosure form he filed, in the 12 months before he left Raytheon, Esper made $1.52 million – and his contract called for him to receive at least $1 million more in deferred compensation in 2022. That seemed outrageous to Senator Elizabeth Warren, who in a hearing before the Senate Armed Services Committee told him to his face that his version of the classic revolving door “smacks of corruption, pure and simple.”
In a July 18 statement Warren wrote: “If confirmed as secretary of defense, Secretary Mark Esper would become the fourth current Trump administration cabinet-level official whose previous job before entering the administration was as a federal lobbyist. In Secretary Esper’s case, he oversaw all lobbying activities at Raytheon for nearly seven years, ending in 2017.”
Raytheon, she noted, “has significant financial interests across the Department of Defense – interests that Secretary Esper will be in a prime position to influence or affect. At his nomination hearing, I asked Secretary Esper to make three simple commitments: First, I asked him to make a commitment to avoid real or perceived conflicts of interest by extending his recusal from participating in decisions involving Raytheon through the duration of his government service.
“This is the same commitment that his predecessor, former Acting Secretary Patrick Shanahan, made with regard to his former employer, Boeing. Secretary Esper refused.
“Second, I asked if he would make a commitment not to seek a waiver allowing him to participate in decisions that would affect Raytheon’s financial interests and Raytheon’s ability or willingness to pay him more than $1 million in deferred compensation. He refused.
“Finally, I asked if he would make a commitment not to swing back through the revolving door to immediately return to work for Raytheon or any other large defense contractor after leaving government service. He refused.”
Despite Warren’s objections, Esper won confirmation from a Republican Senate.
Starting in 2017 when the administration was formed and Esper became army secretary, there’s been a big payoff for the military-industrial complex and its enablers in and around Washington, known these days collectively as the Blob.
“At the president’s urging, Congress increased the military’s already-bloated budget, and Trump has sped up the process for approving arms deals,” reported Rolling Stone. The magazine quoted Raytheon CEO Thomas Kennedy’s assessment last year that “It’s the best time that we’ve ever seen for the defense industry.”
So why was Esper – determined, as he had shown, not to give up the Raytheon trough while he’s in government service – suddenly so sensitive on Wednesday about the appearance of a lesser conflict that others might have to squint to see.
After all, the company Esper’s son Luke works for is IBM, which was beaten out early in the JEDI competition along with Oracle.
Also odd: Luke Esper joined IBM in February, reportedly in a different department not involved in the procurement competition, but his dad just got around to seeing the danger of an appearance of a conflict of interest.
One guess might be that Trump 2020 campaign planners wanted a clear field to go after Vice President Joe Biden’s son Hunter for selling the family name to a Ukrainian company that placed the younger Biden on its board – and that those advisers saw an opening, however narrow, for Democrats to raise a whataboutist cry pointing to Luke Esper’s case.
Or try this: Esper senior (who titles himself doctor even though he sees no patients and his doctorate is in public policy) may have feared – for whatever reason – that the Amazon-Microsoft contest was stacked at the very top of the power structure in favor of a company or companies not founded by the owner of the “Amazon Washington Post,” as Trump calls the paper owned by Jeff Bezos.
Of course, no one other than a venomous Trump-hater would imagine the president ever, ever prioritizing political advantage over the good of the country in making a policy decision.
But still, how happy would the Blob be with the good doctor if his public image suddenly underwent a Giulianian transformation due to involvement in such a scheme? What use would he be then? What might happen to his deferred payout from Raytheon? If such dark thoughts occurred to Esper, then why not voluntarily turn the Solomonic JEDI decision-making task over to his deputy?
If that was Esper’s thinking, maybe it was a good call. Because, get this:
On Friday, the Pentagon announced that the project was going to Microsoft.
The deal stinks to high heaven. If the Democrat-controlled House of Representatives starts investigating immediately, excellent. That’s Congress’s responsibility. Don’t be surprised if Esper resigns from his cabinet post or is fired.