Defense Policy Board: Richard Perle

Policy Profiteers: Right-Wing Think Tanks & Bush's Foreign Policy

Weapons-Makers Cashing In on the War on Terrorism

excerpted from the book

How Much Are You Making On The War Daddy?

A Quick and Dirty Guide to War Profiteering in the Bush Administration

by William D. Hartung

Nation Books, 2003, paper


The Defense Policy Board:
Richard Perle and His Merry Band of Profiteers

Few Americans heard of the Defense Policy Board (DPB) until Richard Perle e~ was forced to step down as its chairman in the spring of 2003. He was charged with abusing his position as a top advisor to Secretary of Defense Donald Rumsfeld for personal gain. Although he chose the self-imposed "punishment" of stepping down from the chairmanship of the Defense Policy Board, he refused to admit to any wrongdoing, and did not give up his seat as a regular member of the board. Amidst the alphabet soup of advisory boards that have been created over the years to provide independent perspectives to the secretary of defense, the secretary of state, and the president-from the Defense Science Board (DSB), to the President's Foreign Intelligence Advisory Board (PFIAB), to the State Department's Defense Trade Advisory Group (DTAG)-the DPB is first among equals in the eyes of the Bush administration.

Under the leadership of Donald Rumsfeld and Richard Perle, the DSB has been transformed from a nonpartisan advisory body designed to give the secretary of defense a broader range of views on pressing security issues into a megaphone for the rigid policy preferences of the secretary of defense. In the run-up to the March 2003 U.S. intervention in Iraq, Perle, former CIA Director R. James Woolsey, former Reagan administration Arms Control and Disarmament Agency head Kenneth Adelman, former House Speaker Newt Gingrich, and the other appointees to the thirty-member DSB were all over the press and television, stumping for Donald Rumsfeld and Paul Wolfowitz's war.

Perle is one of the most viciously partisan operatives in Washington, a true believer in neo-conservative causes who has worked alongside Rumsfeld for more than two decades. He served on the advisory board of Rumsfeld's favorite right-wing think tank, Frank Gaffney's right-wing Center for Security Policy (CSP).

In addition to their CSP connection, both Perle and Rumsfeld signed the June 1997 founding "statement of principles" of the Project for the New American Century (PNAC). This statement, which calls for a return to "a Reaganite policy of military strength and moral clarity," has become the de facto gospel for the resurgent neo-conservative movement. Long before the September 11 attacks were used as a rationale for shifting toward a doctrine of "preventive war," Perle, Rumsfeld and their PNAC pals were touting regime change and peace through strength as essential elements of a new U.S. security policy.

On March 17, 2003, veteran investigative reporter Seymour Hersh reported in the New Yorker that Perle used his position as chairman of the DPB to solicit $100 million for his security-oriented investment firm,-Trireme, which was his own personal version of the Carlyle Group. But unlike the principals at Carlyle, who at least had the decency to wait until they left government service to cash in on their connections, Perle was attempting to capitalize while still serving as an official advisor to Secretary of; Defense Donald Rumsfeld.

Just as Perle was stepping down as the chairman of DPB, the Washington-based Center for Public Integrity released a report indicating that he was not alone among his colleagues on the board in taking an active role as an arms industry consultant, executive, and investment advisor while serving as a close advisor to Donald Rumsfeld. The Center found that nine of the board's thirty members had relationships with weapons contractors that together had received over $76 billion in contracts from the Pentagon in the most recent year for which figures are available. Perle's partners in influence peddling include his neo-con fellow traveler R. James Woolsey, who runs the Global Strategic Security practice for Booz Allen Hamilton, a beltway bandit which bagged $68O million in Pentagon contracts in Fiscal Year 2002; Jack Sheehan, a retired general who works for Bechtel, which is currently cashing in on the rebuilding of Iraq; David Jeremiah, a retired admiral with ties to the Mitre Corporation, a major Pentagon R&D contractor, which is run by fellow DPB board member James Schlesinger, who served as defense secretary prior to Donald Rumsfeld's first go-round at the job back in the mid-1970s.

... Perle and his DPB partner in crime R. James Woolsey who alleged links between Al Qaeda and Saddam Hussein. It was Perle and his colleagues at the DPB who suggested that Saddam Hussein's forces possessed nuclear, chemical, and biological weapons that posed an imminent threat to the United States. And it was Perle and Undersecretary of Defense for Policy Douglas Feith who have pressed most vigorously for a U.S.-backed puppet government led by the Iraqi exile Ahmed Chalabi, a high-living, alleged embezzler who had not stepped inside the country for forty-five years before the Pentagon dropped him in behind U.S. Iines during the early stages of "Operation Iraqi Freedom."

Perle's advice on Iraq has been wrong on all counts. Professional intelligence analysts in the United States, the United Kingdom, and around the world have persuasively argued that there were no operational links between Saddam Hussein and Al Qaeda prior to the spring 2003 U.S.-led invasion of Iraq. U.S. forces failed to find workable nuclear, chemical, or biological weapons in Iraq after taking control of the country. U.S. forces dispatched Saddam Hussein's regime relatively quickly, but it was far from the "cakewalk" that Perle and company-echoed by high administration officials and allies like Deputy Defense Secretary Paul Wolfowitz and Vice President Dick Cheney-claimed it would be. The Iraqi people have not arisen as one to welcome U.S. forces as liberators, and more U.S. troops have died in the occupation phase of the war than were killed in the period leading up to the collapse of the regime of Saddam Hussein. The costs of the war- in lives and dollars-are already several orders of magnitude higher than the neo-con brigades claimed they would be. And United States forces will be bogged down in Iraq for many more months to come.

Despite this record of bad advice-which has undermined the security of our nation and the safety of our troops-Donald Rumsfeld sang Perle's praises when he stepped down as chair of the DPB, calling him a man of "deep integrity and honor," with a "deep understanding of our national security process." Not only did Rumsfeld fail to acknowledge that his long-time fellow partisan had done anything wrong, but his high praise for Perle sounds like it could have been lifted straight from a letter of recommendation. I wouldn't be surprised if Rumsfeld's words, or a summary thereof, appear in one of Perle's future pitch letters for Trireme.


Policy Profiteers:
The role of Right-Wing Think Tanks in Shaping Bush's Foreign Policy

Conservative think tanks and advocacy groups like the American Enterprise Institute (AEI). the Center for Security Policy (CSP), the Jewish Institute for National Security Affairs (JINSA), the National Institute for Public Policy [NIPP] and the Project for the New American Century have developed both the key outlines and many of the specific details of the Bush administration's policies on nuclear weapons, missile defense, and fighting terrorism.

Far from representing a continuation of Reagan's vision, as they claim to do, these groups represent the views of unreconstructed neo-conservative hard-liners like Frank Gaffney, Richard Perle, and John Bolton, men whose most hawkish instincts were held in check by both Ronald Reagan and George Herbert Walker Bush. By appointing policy-makers from these groups to top positions in his administration, and taking their advice in preference to the advice offered by career professionals in the military, intelligence, and foreign service communities, George W. Bush is leading a counter-revolution in Republican thinking on security issues. His neo-con advisors have all of the zeal of revolutionaries, but their policy preferences are straight out of the sixteenth century-they're like feudal lords armed with nuclear weapons.

If you look beyond the rhetoric to the substance of his policies, George W. Bush's administration is radically out of step with the best traditions of every other Republican administration of the post-World War II era, from Dwight Eisenhower and Richard Nixon on through to Ronald Reagan and "Poppy" Bush.

The most dangerous Bush administration break with the policies of his Republican predecessors has been in the realm of nuclear weapons policy. Under the sway of neoconservatives like Frank Gaffney and Dr. Keith Payne of the National Institute for Public Policy (NIPP), George W. Bush has junked the Anti-Ballistic Missile Treaty of 1972, the treaty that was negotiated and signed by the administration of that old red, Richard Nixon. More ominously, Team Bush has set the stage for a new, multi-sided nuclear arms race by advocating the development of a new generation of nuclear weapons and expanding the range of scenarios in which the United States might use, or threaten to use, nuclear weapons.

The Bush nuclear doctrine expands the group of nations that are explicitly acknowledged to be on the list of potential U.S. nuclear targets, going well beyond major nuclear-armed states like Russia and China to include nuclear "wannabes" and non-nuclear nations like Iran, Iraq, Syria, and North Korea. The Bush policy also broadens the range of circumstances under which U.S. nuclear weapons may be used. Bush policy-makers advocate using or threatening to use nuclear weapons in the following scenarios: 1) an attack on a nation that has used chemical or biological weapons against U.S. troops or U.S. citizens; 2) a response to an attack on Israel by Iraq or another Arab state; 3) a military conflict over the status of Taiwan; 4) a North Korean attack on South Korea; or, 5) a response to "surprising military developments." _

The Bush administration's policy of "regime change" in Iraq and beyond was \ prefigured in a series of reports, policy analyses, forums, op-ed pieces, and media interviews by the principals of three other think tanks that are also well represented on Team Bush: the American Enterprise Institute (AEI), the Jewish Institute for National Security Affairs (JlNSA), and the Project for the New American Century.

The American Enterprise Institute (AEI) is where Dick and Lynne Cheney and ultra-right State Department arms control official John Bolton hung their hats before the inauguration of the George W. Bush regime in January of 2001. Richard Perle has long-standing ties to the group as well.

But just as the National Institute for Public Policy complements CSP's right-wing views on nuclear policy, there is an ideologically sympathetic think tank that mirrors CSP's hard-line views on U.S. policy toward the Middle East: the Jewish Institute for National Security Affairs (JINSA). As with NIPP, CSP has significant overlaps with JINSA, most notably in the form of Defense Policy Board member Richard Perle, who serves on advisory panels for both organizations; Undersecretary of Defense for Policy Douglas Feith, who served as chair of the CSP board and a member of JlNSA's board before moving over to the Pentagon; Reagan re-tread Jeane Kirkpatrick, who is an advisor to both groups; and JINSA advisory board chairman David Steinmann, who simultaneously serves as a member of CSP's advisory board.

If it's possible, JINSA may be even more aggressive in its advocacy for a policy of permanent war than Frank Gaffney's outfit has been. JINSA advisors like Michael Ledeen, who handled outreach to Israel for the Reagan administration's illegal Iran/Contra arms-for-hostages operation in the 1980s, likes to talk about the coming era of "total war." In its fervent support for hard-line, pro-settlement, anti-Palestinian Likud-style policies in Israel, JINSA has essentially recommended that "regime change" in Iraq should be just the beginning of a cascade of toppling dominoes in the Middle East. If JINSA has its way, the Bush administration will use military means, covert operations, and strong-arm diplomacy to foment "regime changes" not only in Iraq but also in Iran, Syria, Saudi Arabia, and Egypt. Why this policy of rampant interventionism and destabilization would serve the security interests of either the Israeli or American people is a question that JINSA supporters have no good answer for. In their skewed worldview, overthrowing undemocratic Arab regimes is the royal road to democracy-or at least more pliable, pro-U.S. and Israeli-friendly regimes-in the Middle East and Persian Gulf.

In keeping with its role as a cheerleader for U.S. intervention in the Middle East, JINSA chose to honor Deputy Secretary of Defense Paul Wolfowitz-known as 'Wolfowitz of Arabia" by his critics for his obsession with overthrowing Saddam Hussein and promoting his particular vision of "democracy" throughout the region-to receive the 2002 edition of its Henry M. "Scoop" Jackson public service award. The corporate sponsor for the affair was Northrop Grumman, a company that Wolfowitz worked for as a paid consultant prior to joining Rumsfeld's Pentagon. Wolfowitz's Northrop Grumman connection stood him in good stead with the JINSA crowd. JINSA board members Adm. Leon Edney, Adm. David Jeremiah, and Lieut. Gen. Charles May have also worked for Northrop Grumman as either board members or paid consultants. But if you're interested in corporate firepower, the 2002 Jackson awards paled in comparison with the 2001 ceremonies, which honored Secretary of the Air Force James Roche (a former VP at Northrop Grumman), Secretary of the Navy Gordon England (a longtime executive at Lockheed and General Dynamics), and Secretary of the Army Thomas White (formerly of Enron). The corporate sponsor for the 2001 gala was Boeing, and Rudy De Leon, a former top Clinton administration Pentagon official who now runs Boeing's Washington lobbying operation, served as the official host.

What are we to make of this vast interlocking network of ideologues, retired military men, and corporate executives? It's still ideology first, but the corporate connections are a close second in motivating these think tanks and their operatives to seize and sustain their grip on the U.S. government's security policy apparatus. A veteran intelligence analyst put the relationship between greed and ideology in its proper perspective in an interview with Jason Vest for The Nation magazine: 'Whenever you see someone identified in print or on TV as being with the Center for Security Policy or JINSA championing a position on the grounds of ideology or principle-which they unquestionably are doing with conviction-you are, nonetheless, not informed that they're also providing a sort of cover for other ideologues who just I happen to stand to profit from hewing to the Likudnik and Pax Americana lines.


Project for the New American Century

No survey of the role of right-wing think tanks in shaping the Bush administration's foreign and military policies would be complete without mentioning the Project for the New American Century. In many ways, the founding of PNAC in 1997 marked the opening salvo in the formation of the Bush policy of aggressive unilateralism. The signatories of PNAC's founding statement of principles are a rogue's gallery of intransigent hardliners, ranging from Iran-Contra re-tread Eliot Cohen, to ex-Pentagon hawks 1. Lewis Libby, Paul Wolfowitz, and Donald Rumsfeld, to neo-con standbys Frank Gaffney, former Reagan drug czar William Bennett, and Norman Podhoretz, to the president's brother and partner in electoral crime, Jeb Bush. Add signatory Dick Cheney to the roster, and you have the bulwarks of the neocon network that is currently in the drivers seat of the Bush administration's war without end policies all represented in PNAC's founding document.

The PNAC gang were not satisfied to simply endorse general notions of "peace through strength." They wanted to implement a detailed national security policy agenda. To do so, they issued a report entitled "Rebuilding America's Defenses: Strategy, Forces, and Resources for a New Century." The report was written by then PNAC deputy director Thomas Donnelly, who later left the organization for a more lucrative post at weapons contractor Lockheed Martin, before moving through the revolving door again to a post at the American Enterprise Institute. It drew on the thinking of a hard-right panel of experts that included Donald and Robert Kagan, Weekly Standard editor William Kristol, RAND operative Abram Shulsky-whose recent claim to fame has been heading up a special group of analysts who have been helping Donald Rumsfeld spin and distort intelligence data to make the case for war in Iraq-Paul Wolfowitz, and I. Lewis Libby (who is now serving as Vice President Dick Cheney's chief of staff). Donnelly promoted the PNAC report at the time as "a useful road map for the nation's immediate and future defense plans," but he could not have known how right he would be. From advocating missile defense, to weapons in space, to the development of "a new family of nuclear weapons designed to address new sets of military requirements," the PNAC "road map" foreshadowed many of the most troubling initiatives that have been undertaken by the Bush foreign policy team. But the bread-and-butter of the PNAC report was a neo-imperial call for an expanded American security perimeter that would be capable of "multiple constabulary missions" aimed at preserving a "Pax Americana" based on a drive to "secure and expand zones of democratic peace, deter [the] rise of [a] new great power competitor, defend key regions (Europe, East Asia, Middle East), and exploit [the] transformation of war."

As Tom Barry and Jim Lobe have pointed out in their excellent summary of PNAC's agenda, the authors of the organization's security blueprint were alert to the benefits for their agenda of a catastrophic attack on the United States, noting that "the process of transformation is likely to be a long one, absent some catastrophic or catalyzing event-like a new Pearl Harbor." For the aggressive unilateralists at PNAC-many of whom are now firmly ensconced in top jobs in the administration of George W. Bush-the September 11 terror attacks were a political godsend, in that they created a climate of fear and trauma that made it much easier to promote their aggressive, first strike agenda.

There was no conspiracy relating to 9/11, but there was a great deal of good old-fashioned opportunism and exploitation in the wake of the attacks. The neo-cons seized the political moment to promote their aggressive agenda, and we have been living with the consequences ever since.


Now the Big Three Weapons-Makers Are Cashing In on the War on Terrorism

Aside from firms like Halliburton, Bechtel, and the Carlyle Group, the biggest corporate beneficiaries of the Bush administration's doctrine of aggressive unilateralism are the "Big Three" weapons makers-Lockheed Martin, Boeing, and Northrop Grumman.

New York Times columnist Paul Krugman was right on target when he suggested that rather than "leave no child behind," the slogan that Bush stole from the liberal Children's Defense Fund while he was running for president, Bush's true motto should be "leave no defense contractor behind."

Boeing and Lockheed Martin's contracts have jumped by billions of dollars annually to service the Bush administration's narrow, militarized approach to fighting terrorism. In contrast, Bush's signature educational reform bill-The Leave No Child Behind Act-is already underfunded by nearly $10 billion per year. The assistance originally promised to struggling school districts in inner cities, rural areas, and low- and moderate-income suburbs has long since been swallowed up by war costs and tax cuts.

In fiscal year 2002, the last year for which full statistics are available, Lockheed Martin ($17 billion), Boeing ($16.6 billion), and Northrop Grumman ($7.8 billion) received more than $41 billion in Pentagon contracts. They now get one out of every four dollars the Pentagon doles out for everything from rifles to rockets, MREs (meals-ready-to-eat) to missiles. The Big Three's share of Pentagon research, development, procurement, supply, and service contracts is likely to increase in the years to come, as they use their unprecedented political clout to grab more than their fair share of the military budget pie. This is especially true for Northrop Grumman, which recently acquired TRW, a major military space and Star Wars contractor that had $2 billion n Pentagon contracts in its own right in 2002.

Each of the Big Three is also wired into numerous other sources of federal contracts beyond the Pentagon. The three firms have contracts for everything from airport security and domestic surveillance to a major Lockheed Martin/Northrop Grumman contract to upgrade the weapons and communications systems for the U.S. Coast Guard, which is now part of the newly formed Department of Homeland Security. All three are also major contractors with the National Aeronautics and Space Administration (NASA). Lockheed Martin and Boeing are partners in the U.S. Space Alliance, a NASA-funded effort to privatize the launching of commercial satellites. Lockheed Martin is also a major contractor for the Department of Energy's National Nuclear Security Administration (NNSA), which is in charge of developing, testing, and producing nuclear weapons for the Pentagon and the military services. Lockheed Martin has a $2 billion-per-year Department of Energy contract to run Sandia National Laboratories, a nuclear weapons design and engineering facility based in Albuquerque, New Mexico. Lockheed Martin also works in partnership with Bechtel to run the Nevada Test Site, where new nuclear weapons are tested either via underground explosions-currently on hold due to U.S. adherence to a long-standing moratorium on nuclear testing-or computer simulations. All these additional sources of taxpayer money-from the Department of Homeland Security, NASA, and the Department of Energy's nuclear weapons complex, to nonmilitary and space agencies like the Internal Revenue Service that contract with companies like Lockheed Martin for information processing services-mean that the $41 billion that the Big Three are getting from the Pentagon each year is just the down payment on the federal largesse that is being lavished on these firms.

To put this all in some perspective, Lockheed Martin, which receives well in excess of $20 billion per year in total federal contracts, gets more taxpayer money in an average year than is spent on the largest federal welfare program, TANF (Temporary Assistance for Needy Families)-a program that is meant to provide income support to millions of women and children living below the poverty line. This was also true in the Clinton/Gore era, but the margin between Lockheed Martin's corporate welfare and programs like TANF will only expand in the Bush era.

The Big Three are uniquely well-positioned to benefit from the Bush administration's massive military buildup, in significant part due to the Clinton administration's decision to approve and subsidize a huge wave of post-Cold War mergers among military industry firms. Due to pro-merger policies promoted by Clinton's second Defense Secretary, Bill Perry, weapons makers were able to acquire dozens of formerly independent weapons contractors. For example, Lockheed Martin is a merger of Lockheed and Martin Marietta, engineered by former Martin Marietta CEO Norman Augustine, who arranged to have the taxpayers pick up the tab for at least $855 million in consolidation costs related to the merger, ranging from the costs of dismantling and moving equipment to golden parachutes for top executives and board members that cost taxpayers a cool $31 million, including $8.2 million for Augustine himself. One of the more ironic results of this process was that Lamar Alexander, a former Martin Marietta board member who ran for the Republican presidential nomination in 1996 on a platform of taming "big government" and cutting taxes, was on the receiving end of a $236,000 payment from Lockheed Martin to compensate him for the fact that

he was forced to step down from the board of the merged company. Just as agricultural subsidies have been used at times to pay off agribusiness corporations for not growing crops, Alexander-who announced his candidacy dressed in a flannel shirt, trying to come across as a regular guy- was essentially paid off for not coming to Lockheed Martin board meetings.

The regulatory change that allowed firms like Lockheed Martin to add merger consolidation costs to their Pentagon contracts was pushed through by William Perry and John Deutch, then top deputies to Clinton's first defense secretary, former Wisconsin Congressman Les Aspin. As Patrick Sloyan of Newsday pointed out in a series of articles on the Clinton administration's merger subsidies, both Perry and Deutch had worked as paid consultants to Martin Marietta before coming to the Pentagon, and therefore needed to receive waivers from the normal conflict-of-interest rules to work on an issue that would so obviously benefit their former employer.

The rationale that Perry presented for the mergers was that it was the only way to force the industry to downsize, so that the Pentagon wouldn't be stuck with the tab for extra overhead generated by inefficient firms running half-empty factories. However, other experts, like former Reagan Pentagon official Lawrence J. Korb of the Council on Foreign Relations, asserted that the Pentagon had plenty of leverage to force consolidation without providing additional subsidies to the big weapons-makers. Korb also pointed out that the alleged savings from reduced overhead might never occur, because once merger mania had created a few giant contractors in the place of the dozens that had existed prior to the merger boom, these mega-companies would have even greater leverage to hold up the Pentagon-and the taxpayers-for higher prices on tanks, ships, and planes.

Korb's argument has been borne out by the realities of the costs of major weapons systems. Lockheed Martin's F-22 is coming in at over $200 million a copy-the most expensive fighter plane ever built. Aircraft carriers and attack subs built by subsidiaries of General Dynamics and Northrop Grumman still cost about $2 billion per copy, the equivalent of the entire military budget of some Third World countries.

As Harvey Sapolsky and Eugene Gholz of the Massachusetts Institute for Technology have demonstrated, the Clinton/Gore merger subsidies failed to close down a single major production line for a combat aircraft, or fighting ship, or armored vehicle The companies were able to use their connections in the Pentagon and on Capitol Hill to keep Cold War relics funded, either through regular appropriations or congressional add-ons that come on top of what the Pentagon has requested. So, while Perry and Clinton may have had good intentions in subsidizing consolidation costs, in reality all they ended up doing was giving extra money to companies like Lockheed Martin and Boeing, which swallowed up its rival McDonnell Douglas during the merger boom.

While companies fared well under the Clinton/Gore merger subsidy policy, factory workers did not. Rep. Bernie Sanders (I-VT) rightly described the merger payments as "payoffs for layoffs." Companies were basically given an incentive to lay off workers in the name of "efficiency" without being held accountable to pass the resulting savings to the Pentagon. So tens of thousands of workers lost their jobs and the Big Three collected their government subsidies.

Both Bill Perry and John Deutch took jobs on the boards of major defense firms when they left the Clinton Pentagon-Deutch, who had also served as Clinton's CIA Director, took a seat on the board of Raytheon; Perry took seats at both Boeing and United Technologies. Perry also started his very own Carlyle Group-style defense and high-tech investment advisory firm with former Pentagon colleagues like Paul Kaminski.

While it is true that companies like Boeing and Lockheed Martin have produced some of the most effective weapons systems in history, from the Boeing B-52 bomber to the Lockheed Martin F- 16 combat aircraft, they generally function best when they have to compete for scarce government dollars while being kept under close scrutiny by independent auditors and technical experts. Under the stewardship of Donald Rumsfeld and George W. Bush, these companies are now being offered more money with less scrutiny.

The Pentagon budget has jumped from $300 billion to $400 billion and beyond in two short years, and the new Department of Homeland Security has additional tens of billions in contracts to tempt the Big Three.

In a period of ever-expanding military budgets, the Big 4 Three continue to appropriate funds that could be used for education, environmental protection, health care, and to build the nonmilitary industries that are needed to create the well-paying jobs of the future.

We need to take our country back, not simply from the Bush junta, but from the corporate profiteers who all too often have the leaders of both major parties in the palms of their hands.

How Much Are You Making On The War Daddy?

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