Campaign contributions, war profiteering and President Obama

by Kimberly Dvorak
Kimberly Dvorak's photo

As the 2012 presidential race heats up and campaign donations pour into the candidate’s war chests, voters should pay attention to the “fog of war” contributors. Last monthPresident Obama signed an Executive Agreement, at the dismay of most Americans, to remain in Afghanistan for another 10 years. This wartime news labeled the embattled President as a flip-flopper as well as a DC insider. His once “sterling” image of “hope and change” vanished with the swipe of his presidential pen and transformed him into just another “business as usual” presidential incumbent.

Traditionally wartime presidents reap big defense contractor rewards in the form of campaign donations, and by the looks of the pre-election contributions, Obama is poised to be the winner. According to Open Secrets.org, the defense industry is hedging its bets and lavishing the incumbent president with a two-to-one margin over rival GOP presidential wannabe Mitt Romney.

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Since 1999 the defense industry has more than doubled its niche in the American manufacturing sector. The industry guru’s have deduced that campaign donations of $200 million can produce a return on investment of billions in lucrativePentagon contracts. The defense lobbying effort certainly pays out high returns and the forecast confirms smooth sailing.

So why would President Obama risk his “Nobel Peace” prize and commit more resources to the Middle East? The answer lies with big campaign donors. Obama’s new Afghan War 10-year commitment makes a lot more sense after examining his major donors. It turns out that defense contractors are among the President’s largest supporters. To be fair, the money usually follows the party in power, but it appears defense contractors are hedging their bets and donating huge sums of money to President Obama’s reelection coffers.

As the “President of Peace” enters the final stretch of the expected rough and tumble election, his quick quid pro quo for the new “right” war is being rewarded by the defense industry. For example, power player David Rubenstein co-founder of the Carlyle group (one of the largest defense contractors) garners direct access to the White House. According to visitor logs, President Obama hosted Rubenstein on six occasions during his first year in office. Rubenstein also loaned the newly minted President his copy of the Emancipation Proclamation. Obama proudly displays the coveted agreement in the Oval Office.

Could President Eisenhower’s warning about the military industrial complex finally become reality? And is the Obama Administration banking on support from the largest U.S. defense contractors to pad his reelection coffers ensuring another four years at 1600 Pennsylvania Avenue?

American’s should ask who is benefitting from Obama’s “right” war, the soldiers? No. Are the family members of dead and injured soldiers? No. The taxpayers who are covering the billions of dollars per month? No. It appears to be President Obama and the defense industry that is raking in millions of dollars at the expense of service member’s lives and limbs.

Waning war objectives lends itself to criticisms

According to the latest AP poll only 27 percent of Americans support the Afghanistan War. However, the decade-long war slogs along with no signs of a “winning” strategy or achievable goals.

During a recent 60 Minutes interview retired CIA officer, Cofer Black who planned and implemented the original Afghanistan covert mission was asked how important are mission plans in Afghanistan? He replied simply, “very.”

“The American mission during the early hours after 9/11 (we) sought to destroy al Qaeda and to do so meant removing the Taliban from power,” Black explained. Not only was he was put in charge of hunting the world’s most wanted terrorist, Osama bin Laden, but President George W. Bush tasked the CIA with formulating and launching a war. The classification of war is extremely important, Black explained while he was the CIA counter-terrorism center chief. “My mission was not to ensure little girls go to school in Afghanistan. My mission was not to establish a legal system in Afghanistan. My mission was to destroy al Qaeda and to do that we had to over throw the Taliban.”

“We wanted to win,” Black vehemently said. He brazenly told President Bush “that when the CIA was finished, there were going to be flies walking across their eyeballs, this isn’t a joke, this is a statement of fact of what was going to happen.” President Bush didn’t flinch.

Black did his job well and engineered a decisive victory with roughly 500 special operation forces that took only a few months to conquer and disband the Talban. (Transcript of this CIA international war found on PBS’s Frontline) Black attributes the success to the CIA’s ability to enter Afghanistan with a lot of cash and their ability to leave a small footprint.

If Mr. Romney wins the 2012 election, inside sources say Cofer Black, former CIA spook, former vice chairman of the largest defense contractor Blackwater USA and current VP of Blackbird Technologies, will be his “dark-side” go to guy. In fact, Mr. Romney has already met with and received an intelligence briefing from Cofer Black.

Romney spokesperson Andrea Saul told The Daily Beastthat Black is “a well-respected figure in the national security community and said we are pleased to have him on the team.” She added that Romney “fields advice from a diverse set of advisers, evaluates their opinions, and ultimately makes his own decisions.”

Despite US recession war spending spikes

During the 2008 “hope and change” campaign, the junior Senator from Illinois admonished the Bush Administration, especially VP Dick Cheney, for their misguided and off the books wars. However, once candidate Obama became President the wartime watchdogs were disappointed with Obama’s military spending spree. Many continue to be disappointed that war profiteering remains constant under Democratic leadership.

Government watchdogs point out the $800 billion stimulus package passed in February of 2009 only encouraged more wartime spending. What better way to keep manufacturing plants humming by offering multi-billion dollar Pentagon military no-bid contracts? During Obama’s first months in the White House the country was shedding jobs at an astounding rate and the new President needed a stopgap measure. The defense industry requires a highly skilled workforce and these jobs accounted for an “increase” in the manufacturing sector, something the Democrats like to champion.

While the stagnant economy remains unpredictable, defense contractors, smartly place manufacturing plants in 44 states with influential Congressional districts’ in an effort to flourish off taxpayer money funneled through the Pentagon.

"It's (also) about U.S. alliances, it's about maintaining jobs, and it's about America's broader role in the world - and what you have to do to maintain that role," Veteran Defense Consultant, Loren Thompson told CNN News.

Waste, fraud and abuse rampant

When it comes to reelection contributions, Republicans and Democrats recruit reps across the country to guarantee the Pentagon’s billion dollar contracts. It is the taxpayer that underwrites the large defense contractor manufacturing plants across the country. A prime example of the Chicago-style politics is the Boeing plant located in Obama’s backyard. Wiley contracting firms strategically placed their plant in a blue-collar state in an effort to buy or to twist the arm of greedy politicians.

While defense contractors reach into at least 44 states to curry political favor they also pay Washington’s Beltway bandits on K Street a small fortune to cement their interests inside the corporate sector. Many DC lobbyists negotiate billion dollar contracts using insider information they learned while they were employed at the Pentagon. This is the murky world where defense lobbyists intertwine with the military elite to secure no-bid contracts.

A good example of this revolving door is Army Lieutenant General Robert T. Dail who retired from the service and took an advisory role with LMI a defense related business. Many retired military officials move to the private sector defense industry and parlay their inside knowledge to secure billion dollar contracts. This practice is legal, but many retired officers say it's shameful.

Matt Daigle, of LMI disagrees with those who are offended by military leaders who go on to work after their service careers end. “Mr. Dail provides our organization with honest and forthright advice regarding the direction and strategy for the company. Furthermore, Mr. Dail served his country with distinction.” He continues, “LMI is a not-for-profit government management consultancy. Our support for the federal government extends to more than 40 federal agencies and the military, and is done with transparency and within the rules governing the procurement of services from private businesses. Our work is fairly awarded in accordance with federal acquisition regulations. We do not participate in lobbying, and do not use ‘inside information’ to secure work that is fairly awarded by our federal clients.”

According to a story from CNN, “The money changing hands within the defense industry comes from approximately 85 percent of the Pentagon spending. The industry fat cats have made out since the 9/11-terror attack. The U.S. Defense Department has doubled and spends more in a year than the rest of the world combined. (The U.S. spent $711 billion last year while the rest of the world spent a combined $725).”

“There are a number of legal loopholes that allow the Defense Department, as well as other federal agencies, to avoid competition and to select a single company to provide the desired goods and services. In some cases, there may be only one legitimate supplier of needed goods, or the government can argue that it has “an unusual and compelling urgency,” and that holding a competition would have a detrimental impact on government operations or national security,” an iWatch News story contends.

But those exceptions have become increasingly abused, according to numerous studies. In fact, an analysis of over a dozen government reports and investigations, and interviews with eight former government officials and experts, found a number of concerns about DOD competition practices — attributable in large part to the past 10 years of war. Those include:

• The use of large umbrella contracts to purchase goods and services that could be competed individually, thus resulting in lower price;
• Justifying sole source contracts by citing an “urgent and compelling need,” when in fact the urgency stemmed from the agency’s lack of planning for requirements that have been known for years.
• Extending large contracts as a “bridge,” rather than re-competing them.
• An overall failure to utilize competition in cases that could result in cost savings and better performance.

Meanwhile government watchdogs say the enormous spending habits that lead to monumental waste, fraud and abuse show no signs of slowing. A good example of this is the gasoline costs. The American military pays approximately $400 per gallon of fuel to fill up the US convoys inside the land-locked Afghan nation. (The U.S. also pays Warlords hush money for safe travels along Afghanistan’s insurgent lined roads. (Previous Story Here)

“The Special Inspector General for Afghanistan Reconstruction (SIGAR) warned a military Commission in January of this year that the entire $11.4 billion for contracts to build nearly 900 facilities for the Afghan National Security Forces is at risk due to inadequate planning. This estimate does not include the waste that has resulted from Afghanistan‘s inability to sustain projects. Here is an example of pure waste.”

A few years ago a PA company named Defense Solutionswanted to help the Department of Defense by buying and refurbishing old Soviet Union vehicles and weapons. New York Times bestselling author of Operation Dark Heart, Army LTC Anthony Shaffer (ret) explained this particular contract was a great idea for three reasons:

First, the Afghan military was already used to using Soviet equipment and vehicles (armored personnel carriers, tanks, helicopters) because they have used the Russian equipment since the Soviet occupation.

Second, the military equipment is low tech, durable, cheap to maintain and easy for the Afghans to use. Commonsense dictated that it would be cheaper for NATO, Afghanis and the U.S. to pay for the Russian military paraphernalia. However, U.S. corporations sold the Afghans U.S. weapons in an effort to make a lot of money from the Afghans for U.S. technology.

Finally, LTC Shaffer says, “if the Afghan government should fail, we already know how to defeat Soviet/Russian weapon systems - so we would not be providing the Afghans with U.S. weapon systems that are harder to defeat if we had to fight them.”

Major U.S. corporations lobbied both the Pentagon and the Hill to push for U.S. weapons to be purchased by the U.S. government and given to the Afghans. "This cost the taxpayers a far greater sum of money than the Russian weapons that could have been purchased from former members of the Warsaw Pack, refurbished and sent to Afghanistan,” Shaffer explained. He also said the cost of refurbishing old Soviet gear and giving it to the Afghans would have cost 1/50th of what the U.S. has spent.

It’s projected by military commission reports that money lost as a result of the inability to sustain any number of projects could exceed $35 billion in taxpayer money.

As a result, the (DoD) Commission proposed adding new positions and authorities to improve coordination and cooperation, including alignment of agency budgets, among Defense, State, and USAID in order to limit waste, fraud and abuse.

So far agencies have failed to set or meet goals for competition in the Middle East Wars. In particular, “they have failed and have repeatedly awarded long-term task orders (on a no-compete contract) …even when competitive conditions improved; extended contracts and task orders past their specified expiration dates, increased ceilings on cost-type contracts and modified task orders and contracts to add extensive new work; favored using existing task- and delivery-order contracts like LOGCAP III over creating more competitive and more targeted contract vehicles; and used cost-reimbursable contract types even though simpler, fixed-price contracts could expand the competitive pool,” the commission concluded.

Moving forward requires key reforms

Moving forward, it’s imperative that the Pentagon provides adequate staffing and resources to establish procedures that will protect the taxpayer’s interests. It’s also up to Congress to stipulate resources for contingency and contracting reforms through legislation that requires regular assessment and reporting of agencies’ progress.

Perhaps the most important task Congress is charged with is providing the money used to fund the "unpopular" wars. Ultimately it is the lawmakers that can end the Middle East conflicts with a Congressional floor vote; but many of these politicians are guilty of taking defense contractor cash that results in the death and injury to thousands of military service members. Despite having the facts at their fingertips, power and greed inside the beltway continues to justify the means for America’s blurry foreign policy.