Advocacy group blasts ethics law "loopholes" that allow agency alums to lobby.
As many as 380 high-ranking Defense Department officials and officers over the past decade left government to become lobbyists, corporate board members and defense contractor consultants, according to a transparency group’s tabulations.
In 645 instances documented by the nonprofit Project on Government Oversight, officials went to work for major contractors—Boeing, General Dynamics and United Technologies are the top three—with nearly 90 percent of them doing lobbying, said the study, the group’s update on one of its regular themes going back to 2004.
“The companies argue that [the hires] have issue expertise, but nearly 90 percent of those being are hired as lobbyists,” said Mandy Smithberger, director of POGO’s Center for Defense Information, who spearheaded the report titled “Brass Parachutes: Defense Contractors’ Capture of Pentagon Officials Through the Revolving Door.”
A 2007 law required the Defense Department to keep a database of its senior employees who move to the private sector, but it was not made public, Smithberger told reporters at a Wednesday briefing. It is called the After Government Employment Advice Repository. So POGO obtained a version under the Freedom of Information Act, which was “heavily redacted,” she said. The compilation is “an attempt to show what it would have looked like.”
An appendix lists many names among the 25 generals, nine admirals, 43 lieutenant generals and 23 vice admirals who landed in the commercial sector. A quarter of the officers POGO tracked went to work at the top five defense contractors (Lockheed Martin, Boeing, Raytheon, General Dynamics and Northrop Grumman).
The laws and ethics rules, including those from the Office of Government Ethics, “should prevent government officials from using their public service to advance their personal or financial interests at the expense of the public,” the report said. “These laws are frequently insufficient, however,” for preventing federal employees from going to work for firms they used to regulate.
“The revolving door between the government and the corporations it does business with often creates the appearance that government officials are improperly favoring a company in awarding or managing federal programs and contracts,” POGO concluded. “Without transparency and more effective protections of the public interest, the revolving door between senior Pentagon officials and officers and defense contractors may be costing American taxpayers billions.”
A key purpose of having conflict-of-interest laws in the first place, the report said, is “ the concern that acquisition officials will provide companies an unfair commercial advantage—or outright reward them with government business—in return for future employment.” And one of the ongoing challenges for Defense and other agencies is defining who is an acquisition official.
“The formal definition of an acquisition official in the Defense Acquisition Workforce Improvement Act includes positions involving such functions as program management, logistics, systems planning, procurement, manufacturing, production and cost estimating,” POGO noted. “But the Government Accountability Office has found those definitions leave out personnel with various acquisition-related responsibilities including functions related to setting requirements, contractor oversight and auditing. The Department of Defense’s standards and guidance to department employees show a number of loopholes exist in ethics restrictions regarding procurement.”
Scott Amey, POGO’s general counsel, who worked on the group’s 2004 version of the study, said GAO since the 1970s has produced many alarming studies showing that the ethics rules are not well enforced and “not taken seriously” inside the Pentagon. Today’s situation, he said is like “back to the future.”
The problem has also been examined by the DoD inspector general’s office, but Amey characterized their reports as “not as robust as needed.” (In response to a Government Executive inquiry, the IG’s office provided links to past reports, but did not comment by publication time.)
The POGO report noted that “there are one- or two-year cooling off periods for accepting compensation from a contractor if an employee was a contracting officer, program manager or administrative contracting officer on a procurement with that contractor that was worth more than $10 million, or if the employee approved a payment to that contractor in excess of $10 million.” However, an employee “can accept compensation from a separate division or affiliate of a contractor that does not produce the same or similar products or services as the entity responsible for the contract,” the report said.
Smithberger spoke to one former Pentagon official who said he felt ethically prohibited from going to work for the manufacturer of a weapon on which he worked while in government, but he wouldn’t mind working for a company that is a supplier. The report is “not saying they violated any laws,” she said, “but the laws don’t protect the public interest.”
POGO generally accepts the idea of a two-year cooling off period for officials who leave government, though other critics argue for a longer ban given that the turnover rate at agencies is such that many of retirees’ former colleagues remain in government two years out.
In researching the database, POGO relied on press releases and lobbying registrations, but found that many who leave government are simply ignoring the requirement of registering before lobbying, Smithberger said. Many foreign governments, she added, when lobbied by a retired military officer simply assume that lobbyist still represents his former service.
Defense Secretary James Mattis appears in the report for his past role on the board of the discredited blood-testing company Theranos and as an adviser to the United Arab Emirates.
Gen. James “Hoss” Cartwright is listed for having rescued from cancellation the Joint Land Attack Cruise Missile Defense Elevated Netted Sensor System. Its prime contractor was Raytheon, on whose boards he later served (though he didn’t participate in the company’s contracting operation.)
And former Army Vice Chief of Staff Peter Chiarelli has been on the board of the contractor Harris Corp. since 2012, the report noted.
Asked for comment, the Professional Services Council, which represents 400 companies, expressed skepticism. The report “creates a false premise that a revolving door is a bad thing,” said Executive Vice President and Counsel Alan Chvotkin. “In fact, with appropriate controls it is a good thing, and not just in the government contractors space,” he said on Wednesday. “Whether people come into government and then go out to a company, they often come back to agencies in a variety of capacities. In that sense, the report fails to mention that some significant statutory and regulatory changes have been made to minimize any actual conflict of interest or the appearance of one.”
Yes, there are transparency issues, Chvotkin said, “but that doesn’t mean the controls and accountability aren’t there.” Just because POGO can’t see the Pentagon’s database, he said, doesn’t mean they know whether it is accurate. And if “there are individual examples of violations, there are tools that ought to be used to identify them and hold the people accountable.”
The National Defense Industrial Association had no comment.
POGO recommended that Defense release its database and require contractors to better disclose the employment of former officials. The executive branch and Office of Management and Budget should improve collection of lobbying forms, the report added, and “require government officials to enter into a binding revolving door exit plan that sets forth the programs and projects from which the former employee is banned from working.”
“Retention is important,” Amey said when asked whether the higher salaries offered by private firms are key to the problem. “That should be dealt with in the next pay-gap study,” he said. “They will have to come up with some fixes, but I’m not confident [we] will get them under this administration.”
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