When generals become lobbyists.
- By R. Jeffrey Smith at the Center for Public IntegrityR. Jeffrey Smith is the managing editor for national security at the Center for Public Integrity. The Center for Public Integrity is a non-profit, independent investigative news outlet. For more of their stories go to iwatchnews.org.
"What can you do with a general, when he stops being a general?" crooned Bing Crosby in the 1954 movie "White Christmas." "Who’s got a job for a general when he stops being a general?"
Alas, the answer, 58 years later, is now clear. Retired generals don’t open ski resorts in Vermont. Instead, they hunker down in Washington as the paid employees of corporations that draw most of their income from the service branch in which the generals worked. Once there, they work to maintain a stream of funding from the public treasury.
The revolving door between government service and private companies for those with beribboned chests is now an entrenched feature of life in Washington, according to a new report from Citizens for Responsibility and Ethics in Washington (CREW), a nonprofit government watchdog group.
Updating a 2010 Boston Globe report that documented the practice, CREW found that over the last three years, 70 percent of the 108 three-and-four star generals and admirals who retired "took jobs with defense contractors or consultants."
What’s more, CREW found, some of these same retirees were then appointed to Pentagon advisory boards, such as the Defense Policy Board. The study did not cite examples of improper decision-making, but said the retired generals’ advice to the Pentagon may not be "unbiased," due to their new financial interests.
The Pentagon’s rules only require a one-year wait before retired generals can contact former colleagues still at the Pentagon on behalf of their new employer. But even before that brief period ends, they can provide useful advice to new bosses about how to tap into fresh revenue streams and tip them on upcoming contract opportunities.
As Sen. Claire McCaskill (D-Mo.) put it during a 2009 hearing on Obama’s nomination of former Raytheon executive William Lynn to become the deputy secretary of defense, "it’s an incestuous business, what’s going on in terms of the defense contractors and the Pentagon and the highest levels of our military."
The financial impact of these cozy relationships was studied this year by two political economists at the Swiss Economic Institute, who concluded after a rigorous examination of the Pentagon’s revolving door across six administrations that investors widely expected that hiring senior defense officials would produce higher profits.
They found that American defense companies merely had to announce they had hired a top former Pentagon official to see their stock prices jump, a circumstance they observed in dozens of instances. It was particularly evident in cases where the officials joined corporate boards or became top company executives during Democratic administrations, when strong government-corporate ties are generally scarce.
"It is hard to think of other reasons for higher expected returns than conflicts of interest," said the scholars, Simon Luechinger and Christoph Moser.
After the London Sunday Times published an article last month revealing that retired British general officers were helping defense firms obtain contracts and boost revenues, British defense minister Philip Hammond told reporters that he was contemplating banning the retirees from the ministry building and rewriting any contracts found to have been tainted by such connections.
No similar outrage has erupted on this side of the Atlantic.
Kevin Baron is a national security reporter for Foreign Policy, covering defense and military issues in Washington. He is also vice president of the Pentagon Press Association. Baron previously was a national security staff writer for National Journal, covering the "business of war." Prior to that, Baron worked in the resident daily Pentagon press corps as a reporter/photographer for Stars and Stripes. For three years with Stripes, Baron covered the building and traveled overseas extensively with the secretary of defense and chairman of the Joint Chiefs of Staff, covering official visits to Afghanistan and Iraq, the Middle East and Europe, China, Japan and South Korea, in more than a dozen countries. From 2004 to 2009, Baron was the Boston Globe Washington bureau's investigative projects reporter, covering defense, international affairs, lobbying and other issues. Before that, he muckraked at the Center for Public Integrity. Baron has reported on assignment from Asia, Africa, Australia, Europe, the Middle East and the South Pacific. He was won two Polk Awards, among other honors. He has a B.A. in international studies from the University of Richmond and M.A. in media and public affairs from George Washington University. Originally from Orlando, Fla., Baron has lived in the Washington area since 1998 and currently resides in Northern Virginia with his wife, three sons, and the family dog, The Edge.| The E-Ring |
Meet the guy who’s been told he’s non-essential – three times; South Korea wants more time; No Early Bird today; The Pentagon spent billions before shutdown; Trashing memories at Arlington; and a bit more.Gordon Lubold
Gordon Lubold is a national security reporter for Foreign Policy. He is also the author of FP's Situation Report, an e-mailed newsletter that is blasted out to more than 70,000 national security and foreign affairs subscribers each morning that includes the top nat-sec news, breaking news, tidbits, nuggets and what he likes to call "candy." Before arriving at FP, he was a senior advisor at the United States Institute of Peace in Washington, where he wrote on national security and foreign policy. Prior to his arrival at USIP, he was a defense reporter for Politico, where he launched the popular Morning Defense early morning blog and tip-sheet. Prior to that, he was the Pentagon and national security correspondent for the Christian Science Monitor, and before that he was the Pentagon correspondent for the Army Times chain of newspapers. He has covered conflict in Iraq, Afghanistan, Pakistan and other countries in South Asia, and has reported on military matters in sub-Saharan Africa, East Asia and Latin America as well as at American military bases across the country. He has spoken frequently on the sometimes-contentious relationship between the military and the media as a guest on numerous panels. He also appears on radio and television, including on CNN, public radio's Diane Rehm and To the Point, and C-SPAN's Washington Journal. He lives in Alexandria with his wife and two children.| Situation Report |