Representatives from four Pentagon contractors will march up Capitol Hill tomorrow to repeat a false but familiar refrain: additional reductions in Pentagon spending will wreck the economy and undermine our defenses. The leader of the pack will be Lockheed Martin CEO Robert Stevens, who is rapidly becoming the scare-monger-in-chief in industry efforts to thwart common-sense reductions in the Pentagon budget.
Stevens and his industry cohorts have been riding high for over a decade, with a dozen straight years of increases in Pentagon spending bringing total military outlays to their highest levels since World War II. Department of Defense prime contracts have more than doubled over the past ten years, from $144 billion in 2001 to $375 billion in 2011. Lockheed Martin's fortunes have followed the same path, leaving it with an astonishing $36 billion in Pentagon contracts last year -- a "Lockheed Martin tax" of nearly $300 per taxpaying household. The company's profits have quadrupled in the 2000s, from under $1 billion in 2001 to nearly $4 billion last year.
It is not surprising that Lockheed Martin and its allies want to keep the Pentagon gravy train running full speed ahead, but most taxpayers disagree. Polling numbers released this week by the Program for Public Consultation, the Center for Public Integrity and the Stimson Center demonstrate that majorities in both Republican- and Democratic-leaning Congressional Districts support cuts that are 50 to 100 percent higher than those that would be required by sequestration -- the outcome that the industry and its allies have described as a "doomsday" scenario. No wonder the arms lobby is pulling out all the stops to scare the public into supporting Pentagon budgets far beyond what is needed to defend the country.
That's where this week's hearings come in. Stevens and his cohorts will have the home-court advantage in their efforts to use Congress as a platform for promoting their misleading claims about security and jobs. Committee chair Howard P. "Buck" McKeon (R-CA) is virtually a one-man military-industrial complex, receiving over $750,000 in campaign contributions from the arms industry over the past two election cycles, with $116,000 of that amount coming from -- you guessed it! -- Lockheed Martin. His committee staff has recently been augmented by the hiring of a defense industry executive who came over from Northrop Grumman after receiving a $500,000 golden parachute from the company, a fact that was first revealed in a story broken by the investigative website Republic Report. And Lockheed Martin, Boeing, and General Dynamics have even gone so far as to contribute to McKeon's spouse's campaign for the California State Legislature as a way to curry favor with him.
McKeon is not the only recipient of arms-industry largesse on the House Armed Services Committee. Its members received a total of $3.7 million from weapons makers in the 2010 election cycle alone, with industry booster Rep. Randy Forbes (R-VA) high on that list, receiving $193,000 in contributions in the last two cycles.
These industry contributions are a small price to pay for securing the tens of billions of Pentagon contracts these companies receive each year. Lockheed Martin had a backlog of $81 billion as of December 2011. And as my colleague Stephen Miles and I have noted in a prior post, Lockheed Martin CEO Robert Stevens took home $25.3 million in compensation last year, more than just two Wall Street CEOs. Given that his company receives over 80 percent of its revenue from the U.S. government, the taxpayers are essentially underwriting Stevens' excessive pay package. Yet Stevens will have the nerve to step into a Congressional hearing and cry poverty on behalf of his company.
If weapons contractors are really concerned about the health of the economy, they should support a balanced approach to deficit reduction that puts Pentagon spending on the table instead of trying to scare us all into funding them in the lavish style to which they have become accustomed. And they should get their own houses in order by producing weapons systems that come in on time and without cost overruns. They have far to go on this front given the poor performance of major systems like Lockheed Martin's F-22 and F-35 combat aircraft.
The F-22 is the most expensive fighter plane ever built, at $350 million per copy. Yet it has never been used in combat and it has yet to meet basic safety requirements like reliably getting a safe supply of oxygen to the plane's pilot. The F-35 has more than doubled in price over original estimates, and it has fallen behind on some of its most basic performance requirements. Sen. John McCain (R-AZ) has described Lockheed Martin's management of the F-35 program as "abysmal." The next time it invites Robert Stevens to testify, Rep. McKeon's committee should make him talk about these issues rather than giving him a platform for special interest pleading. That would be one way for the committee to show that it puts the public interest before special interests.
William D. Hartung is the director of the Arms and Security Project at the Center for International Policy and the author of Prophets of War: Lockheed Martin and the Making of the Military-Industrial Complex.
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