Hundreds of U.S. military and government officials
routinely leave their posts for jobs with private contractors who deal with
the government, a process that has eroded the lines between government and the
private sector, according to a report released by a watchdog group on Tuesday.
"There is a revolving door between the government and large private contractors
where conflict of interest is the rule, not the exception," said the report
by the Project on Government Oversight (POGO), a Washington-based group that
monitors military expenditures.
"The revolving door has become such an accepted part of federal contracting
in recent years that it is frequently difficult to determine where the government
stops and the private sector begins," adds the report, titled "The
Politics of Contracting."
The document says that the current contracting system where current and former
public servants use their positions for private gain means powerful private
contractors can potentially rig the system in their own favor.
The group examined the current top 20 federal government contractors from
January 1997 through May 2004 and found that in fiscal year 2002, those top
20 contractors received over 40 percent of the 244 billion dollars in total
contracts awarded by the federal government.
The group says that it also identified 291 instances involving 224 high-ranking
government officials who moved to the private sector to serve as lobbyists,
board members or executives of the contractors.
The report found that at least one-third of the former senior government employees
who went to work for or served on the board of a government contractor were
in official positions allowing them to influence government contracting decisions,
and that accountability rules were not enough to control them.
"Generally, revolving door laws do not apply to the most senior policymakers
who ultimately have the most power in shaping programs and policies that benefit
contractors," says the report.
The issue is gaining interest in the U.S. Congress. Arizona Senator John McCain,
a leading Republican, is expected to hold hearings in mid-July that would be
the first congressional oversight of the revolving door question in nearly a
But the report says that some congressmen are also part of the revolving door
practice. At least two-thirds of the former members of Congress who are lobbying
or have lobbied for the top 20 government contractors, served on authorization
or appropriations committees that approved programs or funds for their future
employer or client during their tenure in Congress.
Among the companies benefiting from the tolerated practice are top U.S. defense
contractor Lockheed Martin, which now employs 57 former senior officials; aerospace
giant Boeing, which employs 33; Air Force contractor Northrop Grumman at 20;
Raytheon at 23; and General Dynamics which employs 19.
The nonprofit watchdog gave the example of Richard Perle, a former Pentagon
official who served as assistant secretary of defence in the Ronald Reagan administration
and was a member of the Defense Policy Board from 1987-2004, serving as its
chair from 2001 to 2003.
He resigned as chairman in March 2003, after a conflict of interest controversy
involving a consulting job he took with the bankrupt telecommunications firm,
Global Crossing Ltd.
The report says that during the summer of 2003, Perle expressed his support
for a Boeing tanker contract – a deal that would direct billions of dollars
to the company. His support for the tankers came just 16 months after Boeing
pledged to invest $20 million with Perle's venture capital firm, Trireme Partners,
notes the report.
The report also cites how Pentagon official Darleen Druyun, who supervised
and directed the management of the Air Force's weapons acquisition program,
moved through the revolving door to become Boeing's deputy general manager for
missile defense systems.
"Darleen Druyun is the poster child for the ills of the revolving door,"
said the report.
The report recommends "revolving door protections," especially when
it comes to high-level officials.
The group wants Congress to pass laws prohibiting political appointees and
people who develop rules and determine requirements from being able to seek
employment from contractors who significantly benefited from the policies formulated
by the government employee.
The group also recommended that the government close a loophole that allows
former government employees to work for a department or division of a contractor
different from the division or department that they oversaw as a government
"It is time for Congress to put its foot in the revolving door to stop
conflicts of interest," said Scott Amey, POGO's general counsel. "Legal
loopholes need to be closed, conflicts of interest and ethics laws need to be
simplified, and the entire process needs to be opened to public scrutiny."