Nuclear Lab Contractors Illegal Lobbying
Dec 21, 2016:
Another nuclear weapons contractor pays millions to settle charges of illegally diverting federal funds
Allegations of illegally spending federal funds to lobby for new funds now encompass contractors working at six of the eight U.S. nuclear weapons sites.
By Patrick Malone, Center for Public Integrity
This time it's Bechtel and URS Corp
The latest settlement involves work by Bechtel National Inc. and its parent Bechtel Corp., and URS Corp. and its subsidiary URS Energy and Construction Inc., which together have been trying to clean up the Hanford Nuclear Reservation, in Washington state, the most toxic site in the country.
...The settlement is part of an emerging pattern.
Lockheed Martin Corp., which operates one of three U.S. nuclear weapons laboratories Ð Sandia, agreed in August 2015 to pay $4.7 million to settle a complaint by the Justice Department that it used federal funds to lobby for a no-bid contract extension. In December of 2016, Department of Energy selected a different contractor team, led by Honeywell International, to run Sandia for up to a decade, beginning next year.)
Meanwhile, Fluor Corp. paid $1.1 million in April 2013 to settle accusations that it used federal funds to lobby government agencies for more business at its Hanford training facility.
(Get all the details at PublicIntegrity.org)
The case of Lockheed Martin
Lockheed Martin manages the Nevada National Security Site, Sandia National Laboratories, and, together with Bechtel, The Y-12 National Security Site and the Pantex Plant in Texas.
Last fall, Washington Business Journal reported
that "if anyone is benefitting from the unease between Russia and the rest of the world, it would have to be Bethesda-based Lockheed Martin Corp. (NYSE: LMT). The company is positioned to make large profits off what could very well be an international military spending spree by Russia's neighbors."
See: U.S. Defense Contractors Tell Investors Russian Threat Is Great for Business
October 16, 2015:
DOE: IG sheds more light on lobbying for Sandia contract
"Yesterday, the department's inspector general released a revised special inquiry report with fewer redactions in response to an appeal under the Freedom of Information Act. The new document is still heavy with white out but does show more of who was helping Sandia as well as who they were trying to influence on Capitol Hill and the Obama administration..."
View/download revised report
A must read: See Charles Tiefer's outstanding article at Forbes:
The 10 Worst Things About Lockheed Martin's Alleged Lobbying Fraud
Note that five of the ten "Worst Things" directly involve New Mexico's ex-Congresswoman Heather Wilson. (read more)
Nukewatch's Jay Coghlan adds these remarks in regard to Heather Wilson:
Ex-Congresswoman Heather Wilson was appointed by John Boehner to be on the Congressional Advisory Panel on the Governance of the Nuclear Security Enterprise. In December 2014 the Panel came out with its long awaited report, "A New Foundation for the Nuclear Enterprise", which benefited the contractors. For example, it argued for diminished federal oversight over contractors, which flies in the face of reality (e.g., constant cost overruns, WIPP, Y-12 security incident, etc., etc.)
Perhaps most alarmingly, the Panel recommended that congressional oversight be strengthened by having the DOE Secretary report to the Senate Energy and Natural Resources and Armed Services Committees, and to the House Energy and Commerce and Armed Services Committees. This would likely have the opposite effect, as it seems to preclude the traditional jurisdiction of the House and Senate Energy and Water Development Appropriations Subcommittees, which have provided key oversight in the past, and have often cut certain nuclear weapons programs. (See our blog piece on the Wilson scandal; also our archived web coverage )
I publicly called on Heather Wilson to resign from that Panel because of her conflict-of-interests. She did not. To add insult to injury, the co-chair of the Panel is Norm Augustine, ex-CEO of Lockheed Martin. LM's tentacles are very widespread.
- Jay Coghlan, NukeWatch.org
- Lockheed Martin had $32 billion in federal contracts in 2014 (classified projects unknown). (ref) and
This included $28 million for IRS data management. (ref)
In the nuclear weapons complex, in addition to Sandia Labs it runs the combined Y12-Pantex nuclear weapons production contract ($2 billion requested in FY 2016) with Bechtel, as Consolidated Nuclear Security, LLC.
Between 2008 and 2015 Lockheed Martin had 169,345 contracts with the US government, worth $293 billion. (ref)
For immediate release, August 22, 2015:
Watchdogs Denounce Slap on Wrist for Illegal Lobbying Activities By the World's Biggest Defense Contractor- and Demand Real Accountability by Barring Lockheed Martin From Future Sandia Labs Contract
Nuclear Watch New Mexico denounces the $4.7 million settlement agreement as a slap on the wrist for the world's biggest defense contractor. Lockheed Martin clearly broke the law by engaging in illegal lobbying activities to extend its Sandia contract without competition, and engaged in deep and systemic corruption, including paying Congresswoman Heather Wilson $10,000 a month starting the day after she left office for so-called consulting services that had no written work requirements. There should be criminal prosecutions for clear violations of federal anti-lobbying laws, and Lockheed Marin should be barred from future competition for the Sandia Labs contract, expected next year.
View full press release (PDF)
View Department of Justice's settlement agreement (PDF)
View Rep. Heather Wilson's contract and invoices pursuant to our FOIA request (PDF)
News Bulletin, August 22, 2015:
Sandia Corporation Agrees To Pay $4.7 Million To Resolve Allegations Related To Lobbying Activities
Lockheed Martin gets slap on the wrist for lobbying violations in Sandia Labs contract extensions.
Read the settlement agreement (PDF)
July 8, 2015:
Busted: Lockheed's Sandia Corp Illegally Lobbied Key Congress Members With Federal Funds to Block Competition For Lucrative Contract
The complete DOE IG November 2014 investigation report has now been released to The Center for Public Integrity following their FOIA request.
CPI has come out with a hard-hitting article about illegal lobbying by the world's biggest defense contractor, Lockheed Martin, to extend its management contract of the Sandia Labs.
This report peels back part of the veil surrounding a defense corporation's "capture strategy" for the Obama administration.
Last November Inspector General Gregory Friedman issued his report on the Special Inquiry into "Alleged Attempts by Sandia National Laboratories to Influence Congress and Federal Officials on a Contract Extension". The full report was designated "For Official Use Only" and given exclusively to the contractor; but a summary was released which outlined the case against Lockheed and Sandia Corp, including the payments made from public funds to then just-retired Congresswoman Heather Wilson for 'consulting' services'.
Now, The Center for Public Integrity has obtained the full report through a FOIA request. In it, Inspector General Friedman writes:
"We recognize that Lockheed Martin Corporation, as a for-profit entity, has a corporate interest in the future of the Sandia Corporation contract. However, the use of Federal funds to advance that interest through actions designed to result in a noncompetitive contract extension was, in our view, prohibited by Sandia Corporation's contract and Federal law and regulations."
"Given the specific prohibitions against such activity, we could not comprehend the logic of using Federal funds for the development of a plan to influence members of Congress and federal officials to, in essence, prevent competition."
And in a phrase that did not appear in the November public summary:
"Perhaps [Sandia National Laboratories] felt empowered because it had improperly directed Federal funds to similar activities in the past."
(ref: Center for Public Integrity)
How to Disrupt the Military-Industrial-Congressional Complex
By Robert Reich, Robert Reich's Blog, July 5 2015
"Ever since the Supreme Court's shameful Citizens United decision, big corporations have been funneling large amounts of cash into American politics, often secretly.
Bad enough. But when big government contractors do the funneling, American taxpayers foot the bill twice over: We pay their lobbying and campaign expenses. And when those efforts nab another contract, we pay for stuff we often don't need.
"A case in point is America's largest contractor- Lockheed Martin. More than 80 percent of Lockheed's revenues come from the U.S. government, mostly from the Defense Department.
Follow the money behind the money. According to the Center for Responsive Politics,
- Lockheed's Political Action Committee spent over $4 million on the 2014 election cycle,
and has already donated over $1 million to candidates for 2016.
- The top congressional recipient of Lockheed's largesse is Mac Thornberry (R-Texas),
Chairman of the House Armed Services committee.
- Second-highest is Rodney Frelinghuysen (R-New Jersey),
Chairman of the Defense Subcommittee of the House Appropriations Committee.
- Third is Kay Granger, the Subcommittee's Vice-Chair.
- Lockheed also maintains a squadron of Washington lawyers and lobbyists dedicated to
keeping and getting even more federal contracts. The firm spent over $14 million lobbying
Congress last year.
"Remarkably, 73 out of Lockheed's 109 lobbyists are former Pentagon officials, congressional staffers, White House aides, and former members of Congress.
You and I and other taxpayers shouldn't have to pay Lockheed's lobbying expenses, but these costs are built into the overhead Lockheed charges the government in its federal contracts.
And we shouldn't foot the bill for Lockheed's campaign contributions, but these are also covered in the overhead the firm charges- including the salaries of executives expected to donate to Lockheed's Political Action Committee.
"The ten largest federal contractors are all defense contractors, and we're indirectly paying all of them to lobby Congress and buy off politicians.
To state it another way, we're paying them to hire former government officials to lobby current government officials, and we're also paying them to bribe current politicians- all in order to keep or get fat government contracts that often turn out to be lousy deals for us.
"Now it's a military-industrial-congressional complex"
"President Obama is said to be considering an executive order requiring federal contractors to disclose their political spending. He should sign it immediately. But he should go further and ban all political spending by federal contractors that receive more than half their revenues from government. That includes Lockheed and every other big defense contractor."
Robert Reich: "How to Disrupt the Military-Industrial-Congressional Complex"
"Pay-to-play is for real."- POGO's General Counsel Scott Amey, in a blog post on Monday.
A report released last year by the Sunlight Foundation detailed how 200 corporations spent a total of $5.8 billion on lobbying and campaign contributions from 2007 to 2012. During the same period, the same companies received $4.4 trillion in federal business and support, the report found. Amey: "In other words, for every $1 the companies spent on political influence and access, they got $760 from the federal government."
- Lockheed lobbying stats: OpenSecrets.org
- Obama considering executive order on contractor campaign spending: The Hill
- Sunlight Foundation report on contractor lobbying: The Hill
- More on Lockheed lobbying at First Street (2012)
- The Matter of Heather Wilson- from the NukeWatch Archives.
Regarding the Lockheed F-35 Joint Strike Fighter contract:
In 2001, Lockheed landed the biggest defense contract in history when it was named the main contractor for the Joint Strike Fighter (est. $400 billion). 14 years on, in April of 2015, the GAO reported that:
"The F-35 Joint Strike Fighter program had to make unexpected changes to its development and test plans over the last year, largely in response to a structural failure on a durability test aircraft, an engine failure, and software challenges. At the same time, engine reliability is poor and has a long way to go to meet program goals. With nearly 2 years and 40 percent of developmental testing to go, more technical problems are likely. Addressing new problems and improving engine reliability may require additional design changes and retrofits." (Source: GAO)
"An army of lobbyists is great. But an army of insiders who know how to navigate the halls of power, can socialize with politicians on weekends and ultimately play the system like a violin is so much better."
-Sheila Krumholz, executive director of the Center for Responsive Politics quoted in
"Obama Pledged to Reduce Nuclear Arsenal, Then Came This Weapon".
Listen to this July 14 podcast from Reveal:
The Nuclear Bomb Industry is Booming
The Center for Investigative Reporting and PRX hit hard at the fishy collusions in the military-industrial-congressional complex, and the results in the nuclear arsenal, like the new B61-12 nuclear bomb.
See also: A Revolving Door in the Nuclear Weapons Industry
Infographic- Back and forth through the nuclear revolving door: Augustine, Wilson, Tauscher, Cook, Mies, Lyons.