ProfitsofWar:CorporateBeneficiariesofthePost-9/11PentagonSpendingSurge

WilliamD.Hartung1

CenterforInternationalPolicy

September13,2021Introduction

TheUnitedStatesgovernment’sreactiontotheterroristattacksofSeptember11,2001ledtodramaticincreasesinPentagonfundingandrevenuesforweaponscontractors.WhilethecostsandconsequencesofAmerica’swarpoliciesofthetwenty-firstcenturyhavebeenwell-documented,thequestionofwhohasprofitedfromthisapproachhasreceivedlessattention.Corporationslargeandsmallhavebeen,byfar,thelargestbeneficiariesofthepost-9/11surgeinmilitaryspending.SincethestartofthewarinAfghanistan,Pentagonspendinghastotaledover$14trillion,one-thirdtoone-halfofwhichwenttodefensecontractors.2Someofthesecorporationsearnedprofitsthatarewidelyconsideredlegitimate.Otherprofitsweretheconsequenceofquestionableorcorruptbusinesspracticesthatamounttowaste,fraud,abuse,price-gougingorprofiteering.

ThePentagon’sincreasingrelianceonprivatecontractorsinthepost-9/11periodraisesmultiplequestionsofaccountability,transparency,andeffectiveness.ThisisproblematicbecauseprivatizingkeyfunctionscanreducetheU.S.military’scontrolofactivitiesthatoccurinwarzoneswhileincreasingrisksofwaste,fraudandabuse.Additionally,thatthewagingofwarisasourceofprofitscancontradictthegoalofhavingtheU.S.leadwithdiplomacyinseekingtoresolveconflicts.Morebroadly,theoutsizedinfluenceofdefensecontractorshasresultedinagrowingmilitarizationofAmerican 1WilliamD.HartungisthedirectoroftheArmsandSecurityProgramattheCenterforInternationalPolicy.TheauthorwouldliketothanktheColombeFoundationandtheArcaFoundationfortheirsupportoftheprogram’sworkonPentagonspendingandtheglobalarmstrade.HewouldalsoliketothankWillSmith,AditiBawa,andTaylorGiornoforresearchassistanceintheproductionofthispaper.2 Calculationbasedonfiguresfrom“NationalDefenseBudgetEstimatesforFY2021,”(2020).U.S.DepartmentofDefense,OfficeoftheUnderSecretaryofDefense(Comptroller),https://comptroller.defense.gov/Portals/45/Documents/defbudget/fy2021/FY21_Green_Book.pdf;“DefensePrimer:DepartmentofDefenseContractors.”(2021).CongressionalResearchService.https://crsreports.congress.gov/product/pdf/IF/IF10600.

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society.ThisismanifestedineverythingfromthePentagon’sreceiptofthelion’sshareofthefederaldiscretionarybudget—morethanhalf—tothesupplyofexcessmilitaryequipmenttostateandlocallawenforcementagencies.3 ThisreportreviewsthemajorsourcesofcorporateprofittiedtoAmerica’spost-9/11wars,aswellasotherfactorsdrivingtheenormoussurgeinmilitaryspendingduringthefirsttwodecadesofthiscentury,includingthegrowthintheglobalarmstrade,therecentfocusonconstruingChinaasathreat,andlargePentagonbudgets.ThePost-9/11SpendingSurge Thepoliticalclimatecreatedbythe“GlobalWaronTerror”(GWOT),asitwasreferredtointheearly2000s,setthestageforlargeincreasesinthePentagonbudget,muchofwhichwenttomilitarycontractors.Thisspendingsurgeincludedincreasesinthebasebudget—theportionofthebudgetnotstrictlyrelatedtoongoingconflicts—aswellastrillionsinspendingontheU.S.’post-9/11wars.Thebasebudgetisrelevanttosustainingalargemilitarywithglobalreach,includingover800overseasmilitarybases,andmassivenuclearweaponscapacity.4Theincreasesinthebasebudgethavebeenoverandabovethe$2trillionindirectcostsofthewarsthemselvesthatwereexpendedthroughthePentagon’sOverseasContingencyOperations(OCO)account.5

ThePentagonbudget—thebasebudgetplustheOCOaccount—increasedbyover10

percentinthefirstyearafterthe9/11attacksandthecommencementofthewarinAfghanistan.ThePentagonbudgetultimatelyincreasedyearafteryearfor10yearsrunning,anunprecedentedoccurrenceinU.S.history.Pentagonspendingpeakedin2010atthehighestlevelsinceWorldWarII—over$800billionin2021dollars.6ThisfigurewassubstantiallymorethantheU.S.spentonitsmilitaryattheheightoftheKoreanorVietnamWarsortheReaganbuildupofthe1980s.7 3SeeNationalPrioritiesProject,(2020).“TheMilitarizedBudget2020,”https://www.nationalpriorities.org/analysis/2020/militarized-budget-2020/.4SeeDavidVine.(2015).“WhereintheWorldIstheU.S.Military,”PoliticoMagazine,https://www.politico.com/magazine/story/2015/06/us-military-bases-around-the-world-119321/.5NetaC.Crawford.(2020).“UnitedStatesBudgetaryCostsandObligationsofPost-9/11WarsThroughFY2020,”CostsofWarProject,https://watson.brown.edu/costsofwar/files/cow/imce/papers/2019/US%20Budgetary%20Costs%20of%20Wars%20November%202019.pdf.6U.S.DepartmentofDefense,OfficeoftheUnderSecretaryofDefense(Comptroller).(2020,April).NationalDefenseBudgetEstimatesforFY2021.https://comptroller.defense.gov/Portals/45/Documents/defbudget/fy2021/FY21_Green_Book.pdf.7WilliamD.Hartung.;BenFreeman.(2020).“SustainableDefense:APentagonSpendingPlanfor2021andBeyond,”CenterforInternationalPolicy,https://3ba8a190-62da-4c98-86d2-893079d87083.usrfiles.com/ugd/3ba8a1_84180a1b3cdf478f8023d8ca96cb682a.pdf.

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Figure1.ThePentagonBudgetfrom1948-2020(inBillionsof2021USD)

“ThePurseisNowOpen”:ThePost-9/11FloodofMilitaryContracts

ThemagnitudeofPentagonspendinginthewakeofthe9/11attackswasremarkable.TheincreaseinU.S.militaryspendingbetweenFiscalYear2002andFiscalYear2003wasmorethantheentiremilitarybudgetofanyothercountry,includingmajorpowerslikeChina,Russia,theUnitedKingdom,Germany,andFrance.8Andinthenewpoliticalclimate,increasesinPentagonspendingreachedwellbeyondexpendituresspecificallytiedtofightingthewarsinIraqandAfghanistan.AsHarryStonecipher,thenVicePresidentofBoeing,toldTheWallStreetJournalinOctober2001,“thepurseisnowopen...anymemberofCongresswhodoesn’tvoteforthefundsweneedtodefendthiscountrywillbelookingforanewjobafternextNovember.”9

Stonecipher’sprophesyofrapidlyrisingPentagonbudgetsprovedcorrect.Adjusted

forinflation,Pentagonspendinggrewbynearlyone-thirdfrom2001to2010.10Militaryspendinghascomedownslightlysince2010,butremainsathistoricallyhighlevels.TheBidenadministration’slatestproposalforspendingonthePentagonandrelateddefense

8SIPRIMilitaryExpenditureDatabase,StockholmInternationalPeaceResearchInstitute,https://www.sipri.org/databases/milex;NationalDefenseBudgetEstimatesforFY2021.9AnneMarieSqueo,AndyPasztor.(2001).“Pentagon’sBudgetBecomesBullet-proof,”TheWallStreetJournal.10NationalDefenseBudgetEstimatesforFY2021.FiguresincludeboththePentagon’sbasebudgetandtheOverseasContingencyOperations(OCO)account.

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worklikenuclearwarheaddevelopmentattheDepartmentofEnergytopped$753billionforFY2022.11

TotalPentagonexpendituresforallpurposessinceFiscalYear2001havetopped

$14.1trillion(measuredin2021dollars).Ofthissum,$4.4trillionwentforweaponsprocurementandresearchanddevelopment(R&D),categoriesthatprimarilybenefitcorporatecontractors.TheremainingfundswenttopayandbenefitsformilitaryandcivilianpersonnelandsupportingexpendituresneededtooperateandmaintaintheU.S.military.The$4.4trillionfigureisaconservativeestimateofthepooloffundingPentagoncontractorshavedrawnfrominthetwodecadessince9/11.ThePentagon’smassivebudgetforoperationsandmaintenance(O&M)alsosubsidizescontractors,butitishardertodeterminewhatshareofthiscategorygoestoprivatefirms.12

Thebenefitsofthepost-9/11surgeinPentagonspendinghavebeenhighly

concentrated.One-quartertoone-thirdofallPentagoncontractsinrecentyearshavegonetojustfivemajorweaponscontractors:LockheedMartin,Boeing,GeneralDynamics,Raytheon,andNorthropGrumman.

“One-quartertoone-thirdofallPentagoncontractsinrecentyearshavegonetojustfivemajorweaponscontractors:LockheedMartin,Boeing,GeneralDynamics,Raytheon,andNorthropGrumman.”

Thesefivecompaniesreceivedover$286billionincontractsinFiscalYear2019andFiscalYear2020alone(seeTable1).13From FY 2001 to FY 2020 these five firms alone split over $2.1 trillion in Pentagon contracts (in 2021 dollars).14Toputthesefiguresinperspective,the$75billioninPentagoncontractsreceivedbyLockheedMartininFY2020iswelloveroneandone-halftimestheentirebudgetfortheStateDepartmentandAgencyforInternationalDevelopmentforthatyear,whichtotaled$44billion.15

11CenterforArmsControlandNonproliferation.(2021).“FiscalYear2022DefenseBudgetRequestBriefingBook,”https://armscontrolcenter.org/wp-content/uploads/2021/06/FY22-Defense-Budget.pdf.12SeeNationalDefenseBudgetEstimatesforFY2021.13FederalProcurementDataSystem.“Top100ContractorsReports,”https://sam.gov/reports/awards/static.14CalculatedfromFederalProcurementDataSystemtop100contractorreportsandUSASpending.gov.Onthispoint,seealsoStephenSemler,“TheTop5MilitaryContractorsAte$2TrillionDuringtheAfghanistanWar,”SpeakingSecurity,August23,2021https://stephensemler.substack.com/p/the-top-5-military-contractors-ate;andEliClifton,“TopDefenseFirmsSpent$1BonLobbyingDuringAfghanWar,Saw$2TReturn,”ResponsibleStatecraft,September2,2021,https://responsiblestatecraft.org/2021/09/02/top-defense-firms-see-2t-return-on-1b-investment-in-afghan-war/.15U.S.DepartmentofState.“CongressionalBudgetJustification:DepartmentofState,ForeignOperations,andRelatedPrograms,FiscalYear2021,”https://www.state.gov/wp-content/uploads/2020/02/FY-2021-CBJ-Final.pdf.

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Table1.PentagonPrimeContractsIssuedtotheTopFiveWeaponsContractorsFiscalYear2019andFiscalYear2020(in$Billions) FY2019Awards

($Billions)FY2020Awards($Billions)

LockheedMartin 47.1 75.2Raytheon 26.3 27.8GeneralDynamics 16.5 21.8Boeing 15.6 21.7NorthropGrumman 14.2 20.3Source:FederalProcurementDataSystemWhoBenefits? AsindicatedinTable1,thebiggestfinancialbeneficiariesofthepost-9/11militaryspendingsurgehavebeenmajorU.S.-basedweaponscontractors.Butweaponsmakerswerefarfromtheonlybeneficiaries.Companiesbenefitingfromthebuildupofthepast20yearsrangefromweaponsmanufacturerslikeRaytheonandLockheedMartin,tologisticsandreconstructionfirmslikeKellogg,BrownandRoot(KBR)andBechtel,toarmedprivatesecuritycontractorslikeBlackwaterandDyncorp.AsnotedbyHeidiPeltierinheranalysisofthe“camoeconomy,”roughlyhalfofthePentagonbudget—$370billionin2019—wenttomilitarycontractors,forbothwar-relatedandongoingpeacetimeactivities.16TheCongressionalResearchServiceestimatesthatinFY2020,thespendingforcontractorsgrewto$420billion—welloverhalfofthetotalPentagonbudget.17ThreeWaystoProfit Companiesprofitfromawareconomyinatleastthreeways:logisticsandreconstruction,privatesecuritycontracting,andsupplyingweapons.Asdemonstratedbelow,numerouscompaniestookadvantageofwartimeconditions—whichrequirespeedofdeliveryandofteninvolvelessrigorousoversight—tooverchargethegovernmentorengageinoutrightfraud.LogisticsandReconstruction

Thefirstwaycontractorshaveprofitedfromthepost-9/11warsisthroughlogisticsandreconstructionworkinthewarzones.Thechaosofwar,thelackofadequategovernmentoversight,andthesheervolumeoffundspouredintothereconstructioneffort

16HeidiPeltier.(2020).“TheGrowthofthe‘CamoEconomy’andtheCommercializationofthePost-9/11Wars,”CostsofWarProject.https://watson.brown.edu/costsofwar/files/cow/imce/papers/2020/Peltier%202020%20-%20Growth%20of%20Camo%20Economy%20-%20June%2030%202020%20-%20FINAL.pdf.17“DefensePrimer:DepartmentofDefenseContractors.”(2021).https://crsreports.congress.gov/product/pdf/IF/IF10600.

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inashorttimeframeallcontributedtoanenvironmentthatenabledmassivewaste,fraudandabuseinthereconstructioneffortsinIraqandAfghanistan.

ThebestknownreconstructionandlogisticscontractorinIraqandAfghanistanis

Halliburton,throughitsKellogg,BrownandRoot(KBR)subsidiary.18Attheoutsetofthetwowars,HalliburtonwastherecipientofthePentagon’sLogisticsCivilAugmentationProgram(LOGCAP)contract,anopen-endedarrangementthatinvolvedcoordinatingawidearrayofsupportfunctionsfortroopsinthefield,fromsettingupmilitarybases,tomaintainingequipment,toprovidingfoodandlaundryservices.19Halliburton’sPentagoncontractsgrewmorethantenfoldfromFY2002toFY2006onthestrengthofitscontractstorebuildIraq’soilinfrastructureandprovidelogisticalsupportforU.S.troopsinIraqandAfghanistan.20ByAugust2008thecompanyhadreceivedover$30billionforworkundertheLOGCAPcontract.21

Attheoutset,Halliburton’srolewascontroversial,drawingconsiderablecriticismin

thepress,fromindependentanalysts,andfromkeymembersofCongress.ThenotionofprivatizinglogisticswasinitiatedbyDickCheneywhenheservedassecretaryofdefenseintheGeorgeHerbertWalkerBushadministrationintheearly1990s.AnAugust2000essayinMotherJonesdescribedtheconflictofinterestinvolvedincontractingoutwartimesupportservices:“In1992,”itsaid,“thePentagon,thenunderCheney’sdirection,paidTexas-basedBrownandRootServices$3.9milliontoproduceaclassifiedreportdetailinghowprivatecompanies—likeitself—couldhelpprovidelogisticsforAmericantroopsinpotentialwarzonesaroundtheworld.”22CheneywentontoserveastheCEOofHalliburton,thecorporateparentofKellogg,BrownandRoot,upuntilthepointthathebecametheVice-PresidentintheGeorgeW.Bushadministrationin2001.Cheneyhadstockholdingsinthecompanyworth$46million,andaslateas2002hereceived$162,000indeferredcompensationfromthecompany.23Cheney’sjourneyfromthegovernmenttoHalliburtonandbackwasaclassiccaseoftherevolvingdoorbetweenthePentagonandthedefenseindustry,withalltherealandpotentialconflicts-of-interestthatentails.

18“Halliburton,KBRSplitUp.”(2007).https://www.reuters.com/article/us-halliburton-kbr/halliburton-kbr-split-up-idUSN0523848520070405.KBRhascontinuedtoreceiveArmysupportcontractsforworkinIraqandAfghanistanafteritsseparationfromHalliburton.See“KBRWinsThreeLOGCAPVContractstoContinueLegacyofSupportingU.S.Troops.”(2019).https://www.kbr.com/en/insights-events/press-release/kbr-wins-three-logcap-v-contracts-continue-legacy-supporting-us.19“HalliburtonWinsLogisticsCivilAugmentationContractfromU.S.Army.”(2001).https://ir.halliburton.com/news-releases/news-release-details/halliburton-kbr-wins-logistics-civil-augmentation-contract-us.20“100CompaniesReceivingtheLargestDollarVolumeofPrimeContractAwards,”DepartmentofTechnicalInformationCenter.21AprilG.Stephenson.(2009).“TestimonyofAprilG.Stephenson,”https://cybercemetery.unt.edu/archive/cwc/20110930004915/http:/www.wartimecontracting.gov/images/download/documents/hearings/20090504/Stephenson_DCAA_testimony_5-4-09.pdf.22RobertBryce.(2000).“Cheney’sMulti-MillionDollarRevolvingDoor,”MotherJones,https://www.motherjones.com/politics/2000/08/cheneys-multi-million-dollar-revolving-door/.23T.ChristianMiller.(2006).“BloodMoney:WastedBillions,LostLivesandCorporateGreedinIraq,”(pp.77-79).LittleBrownandCompany.

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Halliburton’sperformancewasanothermajorsourceofcriticism,asitwasfoundtobedramaticallyoverchargingforbasicservicesanddoingfaultyworkthatputU.S.troopsatrisk.Itwasfarfromtheonlycompanyengagedinsuchactivities,however.

Startingin2004,ayearintotheIraqwar,theSpecialInspectorGeneralforIraq

Reconstruction(SIGIR)—acongressionallymandatedbodydesignedtorootoutwaste,fraudandabuse—andCongressionalwatchdogslikeRep.HenryWaxman(D-CA)exposedscoresofexamplesofovercharges,shoddyconstruction,andoutrighttheftbycontractorsengagedintherebuildingofIraq,butrelativelyfewcompaniessufferedsignificantfinancialorcriminalconsequencesforwhatcanonlybedescribedaswarprofiteering—takingadvantageofthelessrigorousoversightthatobtainedunderwartimeconditionstooverchargethegovernment,includingbyengagingincriminalconduct.24AnadditionalproblemisthatU.S.contractorstoooftenfailedtomakelocalresidentsintegraltorebuildingprojects,underminingthesustainabilityoftheseprojectsoncethecontractorsleftthescene.TheCommissiononWartimeContractinginIraqandAfghanistanestimatedthatwaste,fraudandabuseinthetwowarzonesasof2011hadtotaled$31billionto$60billion.25

AfewexamplesofwastefulspendinginIraqandAfghanistangiveasenseofhow

businesswasconductedthroughoutthewarperiod.InIraq,oneoftheearlyscandalsinvolvedoverchargingforfuelsuppliedtoU.S.forcesbyKellogg,BrownandRoot.InaDecember2003report—lessthanayearintothewar—theDefenseContractAuditAgency(DCAA)documented“tensofmillions”inoverchargesbyKBR,includingchargingmorethantwicewhatothersupplierswerechargingforfuel.26

KBR’sfueloverchargeswerefollowedafewyearslaterbysimilarpricegougingbyafirmcalledInternationalOilTradingCompany(IOTC),whichreceivedcontractsworth$2.7billionfromtheDefenseLogisticsAgency(DLA).AninvestigationbyRep.HenryWaxman(D-CA),chairoftheHouseGovernmentOversightandReformCommittee,foundthatthefirmhadroutinelyoverchargedthePentagonforfuelitbroughtintoIraq,makingover$200millioninprofitsonsalesof$1.4billionduringtheperiodfrom2004to2008,overathirdofwhichallegedlywenttoitsownerHarrySargeantIII,whoalsoservedasthefinancechairmanoftheFloridaRepublicanParty.Waxmansummarizedthesituationasfollows:“ThedocumentsshowthatMr.Sargeant’scompanytookadvantageofU.S.

24See:“SpecialInspectorGeneralforIraqReconstruction,”UNTDigitalLibraries,https://digital.library.unt.edu/ark:/67531/metadc270765/;DemocraticPolicyCommittee(2005).“OversightHearingonWaste,FraudandAbuseinU.S.GovernmentContractinginIraq,”DemocraticPolicyCommittee,https://www.dpc.senate.gov/dpchearing.cfm?h=hearing19.25CommissiononWartimeContractinginIraqandAfghanistan.(2011).“TransformingWartimeContracting:ControllingCosts,ReducingRisks,”https://cybercemetery.unt.edu/archive/cwc/20110929213922/http://www.wartimecontracting.gov/docs/CWC_FinalReport-highres.pdf.26DouglasJehl.(2003).“PentagonFindsHalliburtonOverchargedonIraqContracts,”NewYorkTimes,https://www.nytimes.com/2003/12/11/international/middleeast/pentagon-finds-halliburton-overcharged-on-iraq.html.

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taxpayers.HiscompanyhadtheonlylicensetotransportfuelthroughJordan,sohecouldgetawaywithchargingexorbitantprices.I’veneverseenanothersituationlikethis.”27

Costoverrunsandpoorperformancecharacterizedmuchoftheworkinvolvedin

rebuildingIraq.LargeU.S.firmslikeParsonsandBechtelwerecitedforinadequateandincompleteworkonscoresofprojectsinvolvingeverythingfromwaterprojectstobuildingschoolsandhealthclinics.28AccordingtoaSeptember2006NewYorkTimesaccountofaninvestigationbytheSpecialInspectorGeneralforIraqReconstruction,13of14projectscarriedoutbyParsonsinIraqwere“substandard,withconstructiondeficienciesandotherseriousproblems.”OneoftheprojectsinvolvedtheconstructionofapolicecollegeinBaghdadwhere“plumbingworkwassopoorthatthepipesburst,dumpingurineandfecalmatterthroughoutthecollege’sbuildings.”29

AparticularlyegregiouscaseofshoddyworkthathadtragichumanconsequencesinvolvedtheelectrocutionofatleasteighteenmilitarypersonnelinseveralbasesinIraqbeginningin2004duetofaultyelectricalinstallations,someofwhichweredonebyKBRanditssubcontractors.AninvestigationbythePentagon’sInspectorGeneralfoundthatcommandersinthefieldhad“failedtoensurethatrenovations…hadbeenproperlydone,theArmydidnotsetstandardsforjobsorcontractors,andKBRdidnotgroundelectricalequipmentitinstalledatthefacility.”30

Finally,the2008deathofStaffSgt.RyanMaseth,aGreenBeretwhowaselectrocutedwhileshoweringinIraq,broughtCongressionalandpublicattentiontotheissue.WhileKBRhadinspectedthebuildingthatMasethdiedinandfound“seriouselectricalproblems”almostayearbeforehiselectrocution,KBRdidnotfixtheidentifiedproblems.Notably,KBR’scontractdidnotrequire“fixingpotentialhazards.”31AformerKBRelectricianaccusedotherKBRcontractorsoffalsifyingdocumentstomakeitappearthattheyhadfixedthepreviouslyidentifiedgroundingissues.AnotherformerKBRelectriciantestifiedtotheSenatethatKBRuseduntrainedorinexperiencedelectricianstodoelectricalworkatalowerratewhilebillingtheU.S.governmentatthesamerateusedforexperiencedelectricians.Lastly,inJuly2008,aKBRelectriciantestifiedthattheDoDhadnooversightsystemfortheelectricalwork,evenaftersoldiershadbeenelectrocuted.32 27JamesGlanz.;MichaelLuo.(2008).“G.O.P.DonorIsAccusedofOverchargingPentagon,”NewYorkTimes,https://www.nytimes.com/2008/10/17/world/middleeast/17fuel.html.28JamesGlanz.(2007).“BechtelMeetsGoalsonFewerThanHalfofItsIraqRebuildingProjects,U.S.StudyFinds,”NewYorkTimes,https://www.nytimes.com/2007/07/26/world/middleeast/26reconstruct.html.29JamesGlanz.(2006).“CongressIsToldofFailuresofRebuildingWorkinIraq,”NewYorkTimes,https://www.nytimes.com/2006/09/29/world/middleeast/29contracts.html.30ScottBronstein.(2009).“’Multiple’FailuresLedtoIraqElectrocution,PentagonSays,”CNN.com,https://www.cnn.com/2009/US/07/27/military.electrocutions/.31AbbieBoudreau.;ScottBronstein.(2008).“GreenBeretElectrocutedinShoweronIraqBase,”CNN.com,https://www.cnn.com/2008/US/05/28/soldier.electrocutions/index.html.32SenateDemocraticPolicyCommittee.(2008).“MajorFindings:DPCOversightHearingsonWaste,FraudandCorruptioninIraq,”DPCSpecialReport.https://www.dpc.senate.gov/dpcdoc.cfm?doc_name=sr-110-2-140.

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KBRalsoprofitedfromoverchargesonfoodservicesforU.S.troopsinIraq.Buildingdiningfacilitiesandprovidingmealsatapproximately60basesthroughoutIraqmadeupasignificantportionofKBR’smassiveLOGCAPcontract.InaMay2009testimonybeforetheCommissiononWartimeContracting,theDirectoroftheDefenseContractAuditAgency(DCAA)testifiedthatafterauditing$1.2billionofDiningFacilityCosts(DFAC)fromtheKBRcontract,theDCAA“tookexception”toapproximately$352millionofthetotalcosts.33DCAADirectorAprilStephensonstatedthatthemainreasonforthese“exceptions”wasKBR’spracticeofbillingtheU.S.formanymealsthatwerenotactuallyprovided.ADCAAAuditfoundthatthenumberofmealsKBRchargedthegovernmentforcouldhavebeenupto36percentgreaterthantheaccuratenumber.34ByFebruaryof2004,KBRwasforcedtorefundtheU.S.for$27.4millionof“potentialover-billings”atdiningfacilitiesinIraqandKuwait.35

KBRreliedheavilyonsubcontractors,oftenineffortstoincreaseprofits,attimesthroughillegalmaneuvers.TheCommissiononWartimeContractingreportedthatKBRmanagersreceivedkickbacksfromaKuwaitisubcontractorthatwasthenawarded$700millionworthofadditionaldiningfacilitysubcontractsfromKBR.36

Box1.CusterBattles:“PlayingtheChaos”

SmallerfirmsalsobenefitedfromthechaoticatmospherethatprevailedinIraqduringtheearlyyearsoftheU.S.occupation.OnesuchcompanywasCusterBattles,afirmthathadcontractstoguardtheBaghdadairportandtocollecttheoldIraqicurrency—thedinar—soitcouldbedestroyed.Theprincipalsinthefirmhadnoexperienceinairportsecurityandhadneverreceivedagovernmentcontract.Theyhadbeenthelowbiddersontheairportcontractandpromisedtogetstartedmorequicklythanlarger,moreestablishedcompanies.ButanArmyinspectionoftheiroperationsfoundthattheyhadhiredsecurityguardswithnopriortraining,hirednotranslatorswhospokeArabic,andacquirednosecuritydogstodetectexplosives.TheyalsolivedinluxurycomparedtoU.S.militarypersonnel,asnotedbyT.ChristianMilleroftheLosAngelesTimes,wholaterwentontowriteabookaboutthereconstructioneffortentitledBloodMoney:WastedBillions,LostLives,andCorporateGreedinIraq:“AtatimewhenU.S.soldierswerestilllivingintents,CusterBattleshadbuiltapool,installedairconditioning,andsetupawirelessinternetconnectionforthemselves.Theycouldaffordto,withthegovernmentshovelingmoneyatthem.”37

CusterBattles’briefcareeringovernmentcontractingcametoanendwhenaconsultanttothefirmfoundaspreadsheetthatdocumentedgrossovercharges,the 33AprilG.Stephenson2009.34SharonWeinberger.(2011).“MilitaryLogistics:The$37Billion(Non)Competition,”Wired,https://www.wired.com/2011/08/military-logistics-the-37-billion-noncompetition/.35“HalliburtontoRefund$27MillionforMeals.”(2004).CNNhttps://www.cnn.com/2004/WORLD/meast/02/03/sprj.nirq.halliburton/index.html.36CommissiononWartimeContracting(p.79).37T.ChristianMiller.(2006).“BloodMoney:WastedBillions,LostLivesandCorporateGreedinIraq,”(pp.77-79).LittleBrownandCompany.

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provisionoffakeleasesandbillsforreimbursementbytheU.S.government,andtheuseoffalsefrontcompaniestocarryoutitsfraudulentactivities.ThePentagonbarredthecompanyfromreceivingadditionalgovernmentcontractsandfinedit$10,000—farlessthanitearnedfromitsIraqreconstructioncontracts.Forexample,theCEOofthecompanywaspayinghimself$3millionperyearduringtheperiodduringwhichitwasreceivingcontractsinIraq.38 TheAfghanreconstructionprocessalsoprovidedampleexamplesoffraud,waste,andabuse.ExamplesincludeaU.S.-appointedeconomictaskforcethatspent$43milliononagasstationthatwasneverused,another$150milliononlavishlivingquartersforU.S.economicadvisors,and$3millionforpatrolboatsfortheAfghanpolicethatwerealsoneverused.39Perhapsmostdisturbingly,aCongressionalinvestigationfoundthatasignificantportionof$2billionworthoftransportationcontractstoU.S.andAfghanfirmsendedupaskickbackstowarlords,policeofficials,orpaymentstotheTaliban,sometimesasmuchas$1,500pertruck,oruptohalfamilliondollarsforeachlargeconvoyof300trucks.In2009thenSecretaryofStateHillaryClintonstatedthat“oneofthemajorsourcesoffundingfortheTalibanistheprotectionmoney”paidfromU.S.transportationcontracts.40 AswasthecasewithHalliburton’sKBRunitinIraq,anumberofcompaniescashedinonfoodservicesfortroopsinAfghanistanthroughfraudulentovercharges.In2019,fraudchargesagainstthreeformerexecutivesofAnhamresultedina$45millionsettlementwiththeU.S.Government.AnhamisaDubai-basedlogisticscompanythathadbeentheprimaryfoodandwatersupplieroftheU.S.militaryinAfghanistan.TheJusticeDepartmentchargedthreeAnhamexecutivesin2018“withtwocountsofmajorfraud,onecountofconspiracytoviolatetherestrictionsondoingbusinesswithIran,fourcountsofsubstantiveviolationsofthoserestrictions,andonecountofconspiracytocommitinternationalmoneylaundering.”41Theywereaccusedofcreatinga“PotemkinVillage” 38T.ChristianMiller(pp.174,184). 39ChristianDavenport.(2011).“HowthePentagonSpent$43MilliononaSingleGasStation,”TheWashingtonPost,https://www.washingtonpost.com/news/checkpoint/wp/2015/11/02/how-the-pentagon-spent-43-million-on-a-single-gas-station/;JohnF.Sopko.(2016).“DODTaskForceforBusinessandStabilityOperationsInAfghanistan:ReviewofSelectedExpendituresHighlightsSeriousManagementandOversightProblems,”(pp.11-15).https://www.sigar.mil/pdf/testimony/SIGAR-16-29-TY.pdf;KevinSieff.;ChristianDavenport.(2014).“U.S.Spent$3MilliononBoatsforAghanistanThatWereNeverUsed,InspectorGeneralSays,”TheWashingtonPost,https://www.washingtonpost.com/business/economy/us-spent-3-million-on-boats-that-were-never-used-ig-says/2014/06/12/3c257f32-f242-11e3-9ebc-2ee6f81ed217_story.html?itid=lk_inline_manual_13.40NickSchifrin.(2010).“Report:U.S.BribestoProtectConvoysAreFundingTalibanInsurgents,”ABCNews.com,https://abcnews.go.com/WN/Afghanistan/united-states-military-funding-taliban-afghanistan/story?id=10980527;ReportoftheMajorityStaff,Rep.JohnF.Tierney,Chair.(2010).SubcommitteeonNationalSecurityandForeignAffairs,CommitteeonGovernmentOversight,U.S.HouseofRepresentatives,“Warlord,Inc.:ExtortionandCorruptionAlongtheU.S.SupplyChaininAfghanistan,”https://www.cbsnews.com/htdocs/pdf/HNT_Report.pdf.41U.S.DepartmentofJustice.(2018).“ThreeSeniorExecutivesatDefenseContractingFirmsChargedWithSchemetoDefraudtheU.S.MilitaryinConnectionwith$8BillionTroopSupplyContractandwithViolatingtheIranSanctionsRegime,”https://www.justice.gov/opa/pr/three-senior-executives-defense-contracting-firms-charged-scheme-defraud-us-military.

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constructionsiteinordertooverstateprogressonawarehouseproject.Despitethis,themilitaryremovedasuspensionthathadpreventedAnhamfromapplyingforU.S.governmentcontracts,therebyallowingthecompanytocontinuedoingworkforthePentagon’sDefenseLogisticsAgency(DLA).42

TwoothercontractorsthathavesuppliedtheDefenseLogisticsAgencyalsofacedseriousallegationsoffraud.SupremeFoodserviceGmbH,whichwastheDefenseLogisticsAgency’smainsupplierinAfghanistanbeforeAnham,“fraudulentlyinflatedtheprice”oflocalmarketreadygoodsandbottledwater.43Supremepleadedguiltyin2014tomajorfraudandpaidalmost$300millioninfines.Notably,in2011,shortlyaftertheAfghangovernmentbeganinvestigatingSupremeandarecentlyretiredDLAdirector,Lt.Gen.RobertT.Dail,joinedthecompany,theDLAawardedano-bid,$4billionfood-supplycontracttoSupreme—anothercaseoftherevolvingdoorbetweenthegovernmentandcontractors.44Infact,Lt.Gen.DailawardedSupremetheDLA’s“NewContractoroftheYearAward”justafewyearsbeforeretiringfromthemilitaryandjoiningSupreme.45

Inaddition,theDepartmentofJusticechargedthelogisticsfirmAgility(formerlyknownasPublicWarehousingCompany,orPWC)withfraudin2010andaccusedthecompanyanditsaffiliatesofoverchargingtheU.S.ArmyforfoodthatittransportedtoIraq,Kuwait,andJordanundercontractsworth$8.5billion.46Agilityultimatelyresolveditscriminal,civil,andadministrativecasesbypaying$95milliontotheU.S.government.47Maj.Gen.DanMongeon,anotherformerdirectorattheDLA,beganworkingatAgility/PWCin2006andiscurrentlythecompany’spresident.48

42AaronGregg.(2019).“U.S.Military’sAfghanFoodSupplierStaysinthePictureDespite$45MillionFraudSettlement,”WashingtonPost,https://www.washingtonpost.com/business/2019/12/12/us-militarys-afghanistan-food-supplier-keeps-lucrative-contract-after-massive-fraud-settlement/.43U.S.DepartmentofJustice.(2014).“DefenseContractorPleadsGuiltytoMajorFraudinProvisionofSuppliestoU.S.TroopsinAfghanistan,”https://www.justice.gov/opa/pr/defense-contractor-pleads-guilty-major-fraud-provision-supplies-us-troops-afghanistan.44WalterPincus.(2011).“AgencyExtendsContractForFirmWhoseOfficialsIncludeEx-Director,”WashingtonPost,https://www.washingtonpost.com/national-security/agency_extends_contract_for_firm_whose_officials_include_ex_director/2010/12/29/ABZ43jD_story.html.45WalterPincus.(2011).“AgencyExtendsContractForFirmWhoseOfficialsIncludeEx-Director,”TheWashingtonPost,https://www.washingtonpost.com/national-security/agency_extends_contract_for_firm_whose_officials_include_ex_director/2010/12/29/ABZ43jD_story.html.46MatthewBigg.(2010).“U.S.SlapsNewFraudIndictmentonKuwait’sAgility,”Reuters,https://www.reuters.com/article/us-usa-agility-charge/u-s-slaps-new-fraud-indictment-on-kuwaits-agility-idUSTRE63B5GS20100412.47U.S.DepartmentofJustice.(2017).“DefenseContractorResolvesCriminal,CivilandAdministrativeLiabilityRelatedtoFoodContracts,”https://www.justice.gov/opa/pr/defense-contractor-resolves-criminal-civil-and-administrative-liability-related-food#:~:text=In%20its%20civil%20complaint%2C%20the,pay%2010%20percent%20less%20than.48DanMongeon.AgilityDefenseandGovernmentServices,https://danmongeon.com/?page_id=209.

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PrivateSecurityContractors Thesecondstreamofrevenueforcorporationstiedtothewarwasforprivatesecuritycontractors,someofwhomwereinvolvedinguardingU.S.facilitiesandcriticalinfrastructurelikeIraqioilpipelines.

Thebulkofthecontractorsemployedinthewarzones—morethan60percent—wereengagedinsupportservicessuchasservingmeals,doinglaundry,maintainingandrepairingvehicles,andtransportingfuelandequipment.Armedprivatesecuritycontractorsinvolvedinactivitiessuchasguardingembassies,servingasbodyguards,protectingoilpipelinesandotherinfrastructure,andtraining,wereaminorityoftotalcontractorsdeployed,peakingatabout10,500in2011.49Buttheimpactofprivatesecuritycontractorswasfargreaterthanwhatthosenumbersmightsuggest.Theuseofprivatecontractorsreducestransparencyandaccountabilityforwhathappensinwarzones,onoccasionwithdisastrousresults.Thelackoftransparency,withrespecttotheactivitiesofprivatecontractors,hasbeencompoundedbythePentagon’s2018decisiontostopreportingonthenumbersofU.S.troopsengagedincombatoverseas.50

“Thelackoftransparency,withrespecttotheactivitiesofprivatecontractors,hasbeencompoundedbythePentagon’s2018decisiontostopreportingonthenumbersofU.S.troopsengagedincombatoverseas.”51

ThemostnotoriousprivatesecuritycontractorwasBlackwater,severalofwhose

employeeswereinvolvedinthe2007massacreof17peopleinBaghdad’sNisourSquare.TheyopenedfireonciviliansinacrowdedintersectionwhileguardingaU.S.Embassyconvoy.TheattackpromptedongoinglegalandcivilcasesthatcontinueduntiltheTrumpadministration,whenseveralperpetratorsofthemassacrewerepardonedbyPresidentTrump.52InthewakeoftheshootingBlackwaterwasrebrandedseveraltimes,firstasXEServicesandthenasAcademii,andthefirmeventuallymergedwithTripleCanopy,another 49MosheSchwartz.;JoypradaSwain.(2011).“DepartmentofDefenseContractorsinIraqandAfghanistan:BackgroundandAnalysis,CongressionalResearchService.”(p.7).50TaraCopp.(2018).“PentagonStripsIraq,Afghanistan,SyriaTroopNumbersFromWeb,”MilitaryTimes,https://www.militarytimes.com/news/your-military/2018/04/09/dod-strips-iraq-afghanistan-syria-troop-numbers-from-web/.51TaraCopp.(2018).“PentagonStripsIraq,Afghanistan,SyriaTroopNumbersFromWeb,”MilitaryTimes,https://www.militarytimes.com/news/your-military/2018/04/09/dod-strips-iraq-afghanistan-syria-troop-numbers-from-web/.52MattApuzzo.(2014).“BlackwaterGuardsFoundGuiltyin2007IraqKillings,”NewYorkTimes,https://www.nytimes.com/2014/10/23/us/blackwater-verdict.html;MichaelSafi.(2020).“TrumpPardonsBlackwaterContractorsJailedforMassacreofIraqiCivilians,”TheGuardian,https://www.theguardian.com/world/2020/dec/23/trump-pardons-blackwater-contractors-jailed-for-massacre-of-iraq-civilians.

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privatecontractingfirm.BlackwaterfounderErikPrinceseparatedfromthecompanybuthassincebeeninvolvedinrecruitingprivatemercenariesonbehalfoftheUnitedArabEmiratesfordeploymenttothecivilwarinLibya,inviolationofaUnitedNationsarmsembargo.53PrincealsomadeanunsuccessfulproposaltotheTrumpadministrationtorecruitaforceofprivatecontractorstobethebackboneoftheU.S.wareffortinAfghanistan.54

AnothertasktakenupbyprivatefirmswasinterrogationofIraqiprisoners,includingfirmslikeTitanandCACIInternationalthathadinterrogatorsandtranslatorsonthegroundatAbuGhraib,asitewhereIraqiprisonerswerebrutallytortured.55

Inaddition,aprivatefirm,DynCorp,hadlucrativecontractstotraintheIraqiandAfghanpolice.In2004,DynCorpwasawardeda$2.5billioncontracttodevelopandtrainanewIraqipoliceforcefromtheStateDepartment’sBureauofInternationalNarcoticsandLawEnforcementAffairs(INL).56By2009,overhalfofDynCorp’srevenueswerecomingfromtheIraqandAfghanwars.Inlate2020,DyncorpwasacquiredbyAumentum.57

Dyncorp’sworkwiththeIraqipolicewasmarkedbycorruptionthroughout.Forexample,in2016,theDepartmentofJusticeallegedthatDynCorp“knowinglysubmittedinflatedclaimsinconnectionwithaStateDepartmentcontracttotrainIraqipoliceforces.”58Thedepartmentannouncedin2020thatDynCorppaid$1.5milliontosettlefraudallegationsthatstemmedfromaschemeinwhichDynCorpofficialsreceivedkickbacksfromsubcontractorsinreturnforIraqipolicetrainingsubcontracts.59TwoDynCorpemployeeswereorderedtopay$3.4milliontotheU.S.fortheirparticipationinthekickbackscheme.In2011,DynCorpagreedtopaytheU.S.$7milliontosettleaFalse

53MarkMazetti,;EmilyB.Hager.(2011).“SecretDesertForceSetUpByBlackwater’sFounder,”NewYorkTimes,https://www.nytimes.com/2011/05/15/world/middleeast/15prince.html;DeclanWalsh.(2021).“ErikPrince,TrumpAlly,ViolatedLibyaArmsEmbargo,U.N.ReportSays,”NewYorkTimes,https://www.nytimes.com/2021/02/19/world/middleeast/erik-prince-libya-embargo.html.54TaraCopp.(2018).“Here’stheBlueprintforErikPrince’s$5BillionPlantoPrivatizetheAfghanistanWar,”MilitaryTimes,https://www.militarytimes.com/news/your-military/2018/09/05/heres-the-blueprint-for-erik-princes-5-billion-plan-to-privatize-the-afghanistan-war/.55RenaeMerle.(2004).“CACIandTitanSuedOverIraqOperations,”WashingtonPost,https://www.washingtonpost.com/wp-dyn/articles/A29564-2004Jun9.html;PratapChatterjee.(2004)andA.C.Thompson,“PrivateContractorsandTortureatAbuGhraib,”CorpWatch,https://corpwatch.org/article/private-contractors-and-torture-abu-ghraib.56CommissiononWartimeContracting,(p.78).57“AumentumClosesDyncorpInternationalAcquisition.”(2020).https://www.amentum.com/2020/11/16/amentum-closes-dyncorp-acquisition/.58U.S.DepartmentofJustice.(2016).“UnitedStatesFilesSuitAgainstDynCorpInternationalAllegingSubmissionofFalseClaimsUnderStateDepartmentContracthttps://www.justice.gov/opa/pr/united-states-files-suit-against-dyncorp-international-alleging-submission-false-claims-under.59U.S.DepartmentofJustice.(2020).“DynCorpPays$1.5MilliontoResolveKickbackAllegations,”https://www.justice.gov/usao-edva/pr/dyncorp-pays-15m-resolve-kickback-allegations.

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ClaimsActlawsuitwhichallegedthatDynCorpsubmittedinflatedchargestoINLforworkdoneundertheIraqipolicecontract.60 InAfghanistan,DynCorpwasaprimarycontractorona$20billionStateDepartmentprogramtotrainanddeveloptheAfghanpoliceforcebetween2002and2017.AlthoughpoorsupervisionbytheStateDepartmentwasasignificantpartoftheproblem,DynCorpbearssomeresponsibilityforthefailuretohelpfosteraneffectiveAfghanpoliceforceduringitstenureastheprimarytrainer.By2010,only30,000ofthe170,000Afghanstrainedthroughtheprogramwerestillonthepoliceforce.61Inaddition,only17percentofthedistrictstheIGreviewedwereabletocarryoutlawenforcementoperationsindependentlyandAmbassadorRichardHolbrookepubliclystatedthattheAfghanNationalPolicewas"aninadequateorganization,riddledwithcorruption.”62 Thenumberofpersonneldeployed,andtherevenuesreceivedbysecurityandreconstructioncontractorsgrewdramaticallyasthewarsinIraqandAfghanistanworeon.TheCongressionalResearchServiceestimatedthatbyMarch2011thereweremorecontractoremployeesinIraqandAfghanistan(155,000)thantherewereU.S.uniformedmilitarypersonnel(145,000).63InitsAugust2011finalreport,theCongressionallymandatedCommissiononWartimeContractinginIraqandAfghanistanputthefigureevenhigher,statingthat“contractorsrepresentmorethanhalfoftheU.S.presenceinthecontingencyoperationsinIraqandAfghanistan,attimesemployingmorethanaquarter-millionpeople.64 WhileanarmedcontractorwithabackgroundintheMarinescouldearnasmuchas$200,000peryearinIraq,thebulkofcontractoremployeeswereforeignworkersfromcountrieslikeNepalorthePhilippinesorIraqicitizens.65Thesenon-U.S.personnelaccountedforaboutthree-quartersofthecontractorworkforce,andtheywerealsothemostpoorlypaid,attimesreceivingaslittleas$3,000peryear.66A2017analysisbyBrownUniversity’sCostsofWarprojectdocumented“abysmallaborconditions”andmajorhumanrightsabusesinflictedonforeignnationalsworkingonU.S.-fundedprojectsinAfghanistan,aswellasfalseimprisonment,theftofwages,anddeathsandinjuriesinareasofconflict.67

60“FalseClaimsonIraqiPoliceTrainingContract,”FederalContractorMisconductDatabase,ProjectonGovernmentOversight,https://www.contractormisconduct.org/misconduct/1599/false-claims-on-iraq-police-training-contract.61T.ChristianMiller.(2010).“$6BillionLater,AfghanCopsAren’tReadytoServe,”ProPublica,https://www.propublica.org/article/six-billion-dollars-later-the-afghan-national-police-cant-begin-to-do.62T.ChristianMiller(2010).63MosheSchwartz.;JoypradaSwain.(2011).“DepartmentofDefenseContractorsinIraqandAfghanistan:BackgroundandAnalysis,CongressionalResearchService.”64CommissiononWartimeContracting.65JosephE.Stiglitz.;LindaJ.Bilmes.(2008).“TheThreeTrillionDollarWar:TheTrueCostoftheIraqConflict,”(p.194).NortonandCompany.66T.ChristianMiller.(2006).BloodMoney:WastedBillions,LostLives,andCorporateGreedinIraq,(p.245).Little,BrownandCompany.67NoahCoburn.(2017).“TheGuards,CooksandCleanersoftheAfghanWar:MigrantContractorsandtheCostsofWar,”CostsofWarProject,

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ThenumberofcontractorsinIraqandAfghanistandeclinedwiththenumberofforeigntroopsdeployedtothesewarzones,althoughatasomewhatslowerrate.Forexample,byJanuary2021,therewereroughly2,500troopstotalinIraqandAfghanistan.Thisislessthanone-tenthofthenumberofcontractorsemployedinthewarzonesatthattime.AstheCongressionalResearchServicenoted,“Forthefourthquarteroffiscalyear(FY)2020,U.S.CentralCommand(USCENTCOM)reported43,809contractorpersonnelworkingforDODwithinitsareaofresponsibility,whichincluded27,388individualslocatedinAfghanistan,Iraq,andSyria.”68InconjunctionwiththewithdrawalofU.S.troopsfromAfghanistan,theBidenadministrationhasannouncedthatU.S.-fundedprivatecontractorswillbeleavingthecountryaswell.

Anadditionalcauseforconcernisthepost-wardriveofU.S.contractorstoseekmoreforeignclients.AlthoughlesslucrativethanthefloodofU.S.fundingforprivatecontractorstiedtotheIraqandAfghanwars,theforeignmarketisgrowing,andtheactivitiesofcontractorsemployedinthisfashionhasbeendeeplydisturbing.Forexample,aU.S.firm—Tier1Group,whichwasfoundedbyaformeremployeeofBlackwater—trainedfouroftheSaudioperativesinvolvedinthemurderofU.S.-residentSaudijournalistJamalKhashoggiinaneffortfundedbytheSaudigovernment.AsTheNewYorkTimesnoted,“SuchissuesarelikelytocontinueasAmericanprivatemilitarycontractorsincreasinglylooktoforeignclientstoshoreuptheirbusinessastheUnitedStatesscalesbackoverseasdeploymentsaftertwodecadesofwar.”69WeaponsSuppliers Thelargestbeneficiariesofthepost-9/11warsandthespendingincreasesthataccompaniedthemweretheweaponssuppliers.LockheedMartin,Boeing,NorthropGrumman,Raytheon,andGeneralDynamicswerethetopbeneficiaries,supplyingthebulkofthecombataircraft,attackandtransporthelicopters,armoredvehicles,bombsandmissilesusedinbothIraqandAfghanistan. DuetoalackoftransparencyonthepartofthePentagon,itisnotpossibletofullydistinguishbetweenarmspurchasestieddirectlytothepost-9/11warsversusthoseboughtforothermilitarypurposes.Butthereareanumberofindicatorsthatgiveasenseoftherevenuesthesearms-supplyingcompanieshavereapedfromthewars.

https://watson.brown.edu/costsofwar/files/cow/imce/papers/2017/CoW_Coburn_Migrant%20Contractors_Aug%2023%202017.pdf.68J.P.Lawrence.(2021).“TroopLevelsAreDown,ButU.S.SaysOver18,000ContractorsRemaininAfghanistan,”StarsandStripes,https://www.stripes.com/news/middle-east/troop-levels-are-down-but-us-says-over-18-000-contractors-remain-in-afghanistan-1.659040;CongressionalResearchService,(2021)“DepartmentofDefenseContractorandTroopLevelsinAfghanistanandIraq,2007to2020,”https://fas.org/sgp/crs/natsec/R44116.pdf.69MarkMazzetti.,JulianE.Barnes.;MichaelLaForgia.(2021).“SaudiOperativesWhoKilledKhashoggiReceivedParamilitaryTrainingintheUnitedStates,”NewYorkTimes,https://www.nytimes.com/2021/06/22/us/politics/khashoggi-saudi-kill-team-us-training.html.

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Someoftherevenuesgeneratedbythepost-9/11militaryspendingsurgewereformajorweaponssystemslikecombataircraft,helicopters,tanks,andotherarmoredvehicles.Inaddition,asignificantportionofspendingwentforpurchasesofsmallarmsandammunition.A2016analysisbytheUK-basednon-governmentalorganizationActiononArmedViolencefoundthatthePentagonhadissuedcontractsfor$40billionforgunsandammunitionbetweenSeptember2001andSeptember2015.Thisfigureincludedtheprovisionof1.45milliongunstoIraqandAfghanistan,partofafigureof$2.16billionincontractsforsmallarmsandrelatedequipmentissuedtothosetwocountriesoverthetimeperiodcoveredbythestudy.70AdditionalbillionswerespentequippingU.S.troopsdeployedtothesewarzoneswithfirearmsandammunition,butneitherthePentagon,Congress,norindependentanalystshavedeterminedanexactfigurefortheseadditionalexpenditures. Armoredvehicleswereanothermajorexpenditureduringthepost-9/11conflicts.AreportbytheStimsonCenterfoundthattheArmyhadtakenadvantageofthepoliticalatmosphereandsteadyflowoffundsgeneratedbythewarstobuyanentirenewgenerationofarmoredvehicles.Inall,Pentagonspendingonweaponsandservicestopped$1trillionbetweenFY2001andFY2010,andnearlyone-quarterofthatcamefromsupplementalfundingmeanttosupportthewareffortsinIraqandAfghanistan.71

Box2.ArmsSalesasaMajorRevenueSource Armssaleshavebecomeanincreasinglyimportantsourceofrevenueandprofitsformajorweaponsmakers.TheU.S.hashadthelargestshareoftheglobalarmsmarketfor18ofthepast20years,andthemostlucrativedealsinvolvesystemslikeF-16andF-35combataircraft(LockheedMartin),F-15fightersandApacheattackhelicopters(Boeing),precision-guidedbombsandair-to-groundmissiles(Raytheon),andmissiledefensesystems(RaytheonandLockheedMartin).72

ThebiggestandmostcontroversialmarketforU.S.weaponryinrecentyearshasbeentheMiddleEast,particularlysalestocountrieslikeSaudiArabiaandtheUnitedArabEmirates,whichhavebeeninvolvedinadevastatingwarinYemen,aswellasfuelingconflictselsewhereintheregion.WhileDonaldTrumpmadethemostnoiseaboutMiddleEastsalesandtheirbenefitstotheU.S.economy,theU.S.actuallysoldmorearmstoSaudiArabia,onaverage,duringtheObamaadministration,includingthreemajoroffersin2010thattotaledover$60billionandincludedcombataircraft,attackhelicopters,armored

70IanOverton.;AdamJarvis-Norse.;JenniferDathan.;MiaLombardi.(2016).“U.S.DepartmentofDefenseSpendonGunsin‘WaronTerror,’Revealed,”ActiononArmedViolence,https://aoav.org.uk/2016/us-department-of-defence-spend-on-guns-and-ammunition-in-the-war-on-terror-revealed/.71RussellRumbaugh.(2011).“WhatWeBought:DefenseProcurementfromFY01toFY10,”StimsonCenter,https://www.stimson.org/wp-content/files/file-attachments/Contentv2_1.pdf.72StockholmInternationalPeaceResearchInstituteArmsTransfersDatabase,https://armstrade.sipri.org/armstrade/html/export_values.php;WilliamD.Hartung.;EliasYousif.(2021).“U.S.ArmsSalesTrends,2020andBeyond–FromTrumptoBiden,”SecurityAssistanceMonitor,CenterforInternationalPolicy,https://securityassistance.org/publications/u-s-arms-sales-trends-2020-and-beyond-from-trump-to-buden/.

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vehicles,bombs,missiles,andguns—virtuallyanentirearsenal.73ManyofthesesystemswereusedbySaudiArabiainitsinterventioninYemen,whichcommencedinMarchof2015andinvolvedkillingthousandsofciviliansinindiscriminateairstrikesandimposingablockadethathascontributedsubstantiallytothedeathsofnearlyaquarterofamillionpeopletodate.74

Somemajorfirmshavedevelopedasignificantfinancialdependencyonforeignarmssales.Forexample,becauseofLockheedMartin’sprominentplaceintheglobalmarketforcombataircraft,foreignarmssalesaccountforasignificantshareofthecompany’srevenuesandprofits.In2019,37percentofthesalesofLockheedMartin’sAeronauticsdivision—byfarthelargestpartofthecompany—wereinternationalsales.75BasedonitsF-35foreignsales,thissharemayincreaseonce2020figuresareavailable.BoeingandRaytheonTechnologieshavesignificantcommercialaswellasmilitaryexports,soitishardertogaugetheirlevelsofdependenceonforeignarmssales.ButpriortoitsmergerwithUnitedTechnologies,theCEOofRaytheonindicatedthatsalestoSaudiArabiaaloneaccountedforroughly5percentofthecompany’srevenue.76ArmssalescontractsbetweenU.S.firmsandforeignclientsarelikelytoriseinthenextfewyearsonthestrengthofdealsmadein2020,whentheU.S.madeanearrecord$110.9billioninoffersundertheForeignMilitarySales(FMS)program,agovernment-to-governmentarmssaleschannelthataccountsforthebulkofmajorU.S.armssales.77

Aswithothermilitaryprogramsundertakensince9/11,therewasconsiderablefraudinthesupplyofweaponrytoU.S.andalliedforces.Perhapsthemostegregiousexamplewastheinfamous“wardogs”case,whichwasmemorializedinbothabookandaHollywoodmovie.Thesagabeganin2007,whentheDoDawardedAEYInc.a$298millioncontracttosupplytheAfghanmilitaryandpoliceforceswithmunitions.78EfraimDiveroliwasthe22-year-oldpresidentofAEYwhenthecompanywasawardedthecontracttoserveastheprimaryammunitionsupplierfortheAfghanarmyandpolice.79Alarge 73WilliamD.Hartung.(2018).“U.S.MilitarySupportforSaudiArabiaandtheWarinYemen,”CenterforInternationalPolicy,https://docs.wixstatic.com/ugd/3ba8a1_5e9019d625e84087af647e6cb91ea3e2.pdf.74“UNHumanitarianOfficePutsYemenWarDeadat233,000,Mostlyfrom‘IndirectCauses,”(2020).UNNewshttps://news.un.org/en/story/2020/12/1078972;“AThirdofSaudiCoalitionAirStrikesinYemenTargetedCivilian,”(2020).MiddleEastMonitor,https://www.middleeastmonitor.com/20200326-a-third-of-all-saudi-coalition-air-strikes-in-yemen-targeted-civilians/;WilliamD.Hartung.;CassandraStimpson.(2019).“U.S.ArmsSalestoSaudiArabia:TheCorporateConnection,”CenterforInternationalPolicy,https://static.wixstatic.com/ugd/fb6c59_bd62e10ae7b745069e9a6fa897de6a39.pdf.75LockheedMartinCorporation,SECForm10-K,2019,(p.5).https://www.lockheedmartin.com/content/dam/lockheed-martin/eo/documents/annual-reports/lockheed-martin-annual-report-2019.pdf.76NatashaKurak.(2019).“RaytheonInternationalCEOonSalesToSaudiArabia–‘WeDon’tMakePolicy,’”CNBC.com,https://www.cnbc.com/2019/02/16/raytheon-exec-on-sales-to-saudi-arabia-we-dont-make-policy.html.77WilliamD.HartungandEliasYousif,“U.S.ArmsSalesTrends2020andBeyond:FromTrumptoBiden,”SecurityAssistanceMonitor,CenterforInternationalPolicy,April2021,https://3ba8a190-62da-4c98-86d2-893079d87083.usrfiles.com/ugd/3ba8a1_2e4d4e9155664535a4a337fe4a91986b.pdf.78C.J.Chivers.(2008).“SupplierUnderScrutinyonArmsforAfghans,”NewYorkTimes,https://www.nytimes.com/2008/03/27/world/asia/27ammo.html.79C.J.Chivers2008.

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amountoftheammunitionAEYprovidedwasdecadesoldandfromformerEasternBloccountries.Muchoftheammunitionwasinverypoorconditionandunreliable.Mostnotably,theammunitionthatAEYboughtinlargequantitiesfromdepotsinAlbaniawasincrediblyvolatile.Thecompanydidalmostnothingtotesttheperformanceandsafetyoftherounds.80

TensofmillionsofthecartridgesAEYsoldweremanufacturedinChinaandgiventoAlbaniaduringtheColdWar.Becauseofthis,sellingtheChinese-producedammunitionviolatedaU.S.armsembargoaswellasaclauseinAEY’scontractthatbannedpurchasingammunitionproducedbytheChinesemilitaryestablishment.81WhileAEYknewthatitwasillegaltoselltheChineseammunitionthatitboughtfromtheAlbanianMinistryofDefensethroughamiddleman,thecompanyattemptedtohidethefactthatitwasproducedinChinainordertoincreaseitsprofits.82AEYofficialsEfraimDiveroli,RalphMerrill,AlexPodrizki,andDavidPackouzwereallindictedandchargedwithfraudandconspiracybytheDepartmentofJusticein2008.83Diverolipleadedguiltytoconspiracyin2009andwassentencedbyajudgetofouryearsinprison.84PackouzandPodrizkialsopledguiltyin2009.KeepingtheFundsFlowing:ChinaasTheNewRationaleforMassivePentagonOutlays AstheU.S.hasreducedthesizeofitsmilitaryfootprintinIraqandAfghanistan—relyingmoreheavilyondeploymentsofsmallerunitsofSpecialForces,trainingofalliedmilitaries,andarmstransferstoexertmilitaryinfluence—exaggeratedestimatesofthemilitarychallengesposedbyChinahavebecomethenewrationaleofchoiceinargumentsforkeepingthePentagonbudgetathistoricallyhighlevels.85Overseasmilitaryengagementswillmeanwhilecontinuetobeasourceofampleprofitsforcontractorsofalltypes,giventhattheU.S.militarywillstillbeinvolvedincounterterrorismoperationsinover85nations;willmaintainhundredsofoverseasmilitarybases;isengagedinsignificantnewbaseconstructioninanumberofareasincludingGuamandtheMarianas;andwillcontinuetoserveastheworld’slargestweapons-supplyingnation,withover$110billioninarmssalesoffersundertheU.S.government’sForeignMilitarySalesprogramin

80C.J.Chivers2008.81UnitedStatesAttorney’sOffice,SouthernDistrictofFlorida.(2011).“MunitionsSupplierSentencedonDefenseProcurementFraudandLyingtoArmyonGovernmentMunitionsContract,”https://www.justice.gov/archive/usao/fls/PressReleases/2011/110323-01.html.82C.J.Chivers2008.83C.J.Chivers.(2010).“ArmsDealerFacesNewCharges,”TheNewYorkTimes,https://www.nytimes.com/2010/08/24/us/24arms.html.84DanLamothe.(2016).“ACockyArmsDealerFleecedthePentagonin‘WarDogs’:NowHe’sFightingforMovieProfits,”TheWashingtonPost,https://www.washingtonpost.com/news/checkpoint/wp/2016/08/19/a-cocky-arms-dealer-fleeced-the-pentagon-in-war-dogs-now-hes-fighting-for-movie-profits/.85WilliamD.Hartung.(2020).“TheChallengeFromChinaIsNotMilitary,”Forbes,https://www.forbes.com/sites/williamhartung/2020/09/04/the-challenge-from-china-is-not-military/?sh=2c1dd9e6fcc6;JohnIsaacs.(2021).“ChinaIsNottheNewSovietUnion,”CenterforArmsControlandNonproliferation,https://armscontrolcenter.org/china-is-not-the-new-soviet-union/.

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2020alone.86ButclaimsaboutChina’sriseandtheneedforarobustmilitaryresponsearenowdominatingthebudgetdebateinWashington. ThemostrecentsurgeinconcernaboutChinesemilitarypowerwassparkedbythePentagon’s2018NationalDefenseStrategy,whichtargeted“greatpowerrivalry”asthegreatestthreattoU.S.securityandglobalinfluence.87TheNDSwasfollowedayearlaterbytheCongressionallymandatedNationalDefenseStrategyCommission,whichranganevenlouderalarmbellaboutthepurportedthreatfromChinaandproposed3to5percentannualgrowthinthePentagonbudgettoaddressit.Thesethreatsweretouted,alongsideratherthaninsteadofexistingperceivedchallengeslikeglobalterrorismandregionalpowerslikeNorthKoreaandIran.88Nineofthe12membersofthecommissionhaddirectorindirecttiestothearmsindustry,arealitythatnodoubthadsomeinfluenceovertheirdeliberationsandconclusions.89The3to5percentgrowthratehasbecomeamantraofPentagonbudgethawkslikeSen.JamesInhofe(R-OK),therankingRepublicanontheSenateArmedServicesCommittee,deployedrelentlesslyasacritiqueoftheBidenadministration’smorethanampleproposalofover$750billionfornationaldefense—thePentagonplusnuclearweaponsdevelopmentworkattheDepartmentofEnergy—which,asnotedabove,isoneofthehighestlevelssinceWorldWarII.90 TheChinathreatargumenthasbeenutilizedtojustifythequestfora350shipNavy—upfromabout300shipscurrently;majorAirForcepurchaseslikeanewbomberandtheF-35combataircraft;thePentagon’s$1.5trillion,threedecades-longproposednuclearweaponsupgradeplan;theSpaceForce,anewbranchofthearmedforces;majorexpendituresonmissiledefensesystems;andlargenewinvestmentsincybertechnologiesandtactics(offensiveanddefensive),unmannedsystems,hypersonicweapons,andartificialintelligence.ManyoftheseinitiativeswerewellalongbeforeChinabecametheprimarypreoccupationofU.S.militaryplanners,butthe“Chinacard”hasbecometheargumentofchoicetoconsolidatepoliticalsupportfortheseexpenditures.ThemostlikelyimpactoftheshifttowardsChinawillbetofurthertightenthegripofmajorweapons 86StephanieSavell.(2021).“UnitedStatesCounterterrorismOperations2018to2020,”CostsofWarProject,https://watson.brown.edu/costsofwar/files/cow/imce/papers/2021/US%20Counterterrorism%20Operations%202018-2020%2C%20Costs%20of%20War.pdf;WilliamD.Hartung.;EliasYousif,“U.S.ArmsSalesTrends2020andBeyond:FromTrumptoBiden,CenterforInternationalPolicy,https://3ba8a190-62da-4c98-86d2-893079d87083.usrfiles.com/ugd/3ba8a1_2e4d4e9155664535a4a337fe4a91986b.pdf.87U.S.DepartmentofDefense.“Summaryofthe2018NationalDefenseStrategyoftheUnitedStatesofAmerica,”https://dod.defense.gov/Portals/1/Documents/pubs/2018-National-Defense-Strategy-Summary.pdf.88“ProvidingfortheCommonDefense:TheAssessmentandRecommendationsoftheNationalDefenseStrategyCommission.”(2018).https://www.usip.org/sites/default/files/2018-11/providing-for-the-common-defense.pdf.89DanGrazier.(2018).“PanelofDefenseLobbyistsandRevolvingDoorDoyensCallsforMoreDefenseSpending,”ProjectonGovernmentOversight,https://www.pogo.org/analysis/2018/12/panel-of-defense-lobbyists-and-revolving-door-doyens-calls-for-more-defense-spending/.90JamesInhofe.(2021).“DefenseBudgetfor2022IsFirstTestoftheBidenAdministrationonChina,”Newsweek,https://www.newsweek.com/defense-budget-2022-first-test-biden-administration-china-opinion-1580185;JoeGould.(2021).“KeyRepublicansPressBidentoHikeDefenseBudget3to5Percent,”DefenseNewshttps://www.defensenews.com/congress/2021/03/04/key-republicans-press-biden-to-hike-defense-budget-3-to-5-percent/.

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makerslikeNorthropGrumman,LockheedMartin,GeneralDynamics,andRaytheonTechnologiesonthePentagonbudget.ButtherewillstillbeopportunitiesforprivatecontractorslikeDyncorpthatareinvolvedintrainingofforeignmilitaryandpoliceforces,especiallyifthetrendtowardsdeployingfewerU.S.troopsinwarzonescontinues.ToolsofInfluence

ThearmsindustryhasampletoolsatitsdisposaltoinfluencedecisionsoverPentagonspendinggoingforward.Theindustryhasspent$285millionincampaigncontributionssince2001,withaspecialfocusonpresidentialcandidates,Congressionalleadership,andmembersofthearmedservicesandappropriationscommitteesintheHouseandSenate—thepeoplewiththemostpoweroverhowmuchthecountrywillspendformilitarypurposes.91Inaddition,weaponsmakershavespent$2.5billiononlobbyingoverthepasttwodecades,employing,onaverage,over700lobbyistsperyearoverthepastfiveyears,morethanoneforeverymemberofCongress.”92

“Inaddition,weaponsmakershavespent$2.5billiononlobbyingoverthepasttwodecades,employing,onaverage,over700lobbyistsperyearoverthepastfiveyears,morethanoneforeverymemberofCongress.”93

Themajorityoftheselobbyistshavepassedthroughthe“revolvingdoor”fromjobsinCongress,thePentagon,theNationalSecurityCouncilorotherkeyagenciesinvolvedindeterminingthesizeandscopeoftheannualbudgetfornationaldefense.94Theserevolvingdoorhiresusetheirconnectionstotheirformercolleaguesingovernmenttoadvocatefortheircorporateemployers,oftentogoodeffect(fromthestandpointofthearmsindustry).AreportbytheProjectonGovernmentOversightfoundthattherewere645instancesofthetop20defensecontractorshiring“formerseniorgovernmentofficials,militaryofficers,MembersofCongress,andseniorlegislativestaffaslobbyists,boardmembers,orseniorexecutives”in2018alone.95Inadditiontohavingtheinsidetrackoninfluencingdecisionmakingondefense,governmentpersonnelwhopassthroughtherevolvingdoormaygivespecialtreatmenttocontractorswhiletheyarestillingovernment,inhopesoflandinglucrativepositionswithadefensecontractoruponretirementfromgovernmentservice.

91DanAuble.(2021).“CapitalizingonConflict:HowDefenseContractorsandForeignNationsLobbyforArmsSales,”CenterforResponsivePoliticshttps://www.opensecrets.org/news/reports/capitalizing-on-conflict.92CenterforResponsivePolitics(2021).93CenterforResponsivePolitics(2021).94CenterforResponsivePolitics(2021).95MandySmithberger.(2018).“BrassParachutes:TheProblemofthePentagonRevolvingDoor,”ProjectonGovernmentOversighthttps://www.pogo.org/report/2018/11/brass-parachutes/.

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Tocitejustoneofscoresofexamples,formerheadoftheJointChiefsofStaffGen.JosephDunford,whowasamajorboosterofLockheedMartin’stroubledF-35combataircraft,joinedthecompany’sboardjustfourmonthsafterleavingthemilitary.96ThesekindsofinteractionsraiseseriousquestionsaboutwhetherspecialinterestsorthenationalinteresthavethegreaterswayindeterminingU.S.defensepoliciesandprocurementchoices.

It’simportanttonotethattherevolvingdoorswingsbothways.Notonlydoformer

governmentpersonnelgointoindustry,butindustrypersonnelfrequentlytakeinfluentialpositionsingovernment.Forexample,fourofthepastfiveU.S.SecretariesofDefensecamefromoneofthetopfivearmscontractors:

“Forexample,fourofthepastfiveU.S.SecretariesofDefensecamefromoneofthetopfivearmscontractors”

formerTrumpadministrationsecretariesofdefenseJamesMattis(boardmemberatGeneralDynamics),PatrickShanahan(executiveatBoeing),MarkEsper(headofgovernmentrelationsatRaytheon)andBidenadministrationdefensesecretaryLloydAustin(boardmemberofRaytheonTechnologies).97

Defensecontractorsalsoexertsignificantinfluencebyfundingwell-knownthink

tanksthatadvocateforhigherPentagonbudgetswithouthighlightingthemoniedinterestspushingthatviewpointforward.AreportbytheCenterforInternationalPolicyfoundthatAmerica’stop50thinktanksreceivedonebilliondollarsfromweaponsfirmsortheU.S.governmentfrom2014to2019,andthisisjustthetipoftheiceberg.98MajorthinktanksreceivinglargeamountsofcontractorfundingincludetheCenterforaNewAmericanSecurity(CNAS),theCenterforStrategicandInternationalStudies(CSIS),andtheHeritageFoundation.99SmallerthinktanksliketheLexingtonInstituteandtheNationalInstituteofPublicPolicy(NIPP)—whichfalloutsideofthetop50—getmajorfundingfromfirmslikeBoeing,LockheedMartin,andNorthropGrummanwhileprovidingamegaphonefor

96JasonPaladino.(2020).“TheChairmanoftheRevolvingDoor,”ProjectonGovernmentOversight,https://www.pogo.org/investigation/2020/03/the-chairman-of-the-revolving-door/.97RyanBort.(2019).“Trump’sPickforDefenseSecretaryIsasSwampyasYou’dExpect,”RollingStone,https://www.rollingstone.com/politics/politics-news/trump-defense-secretary-mark-esper-859988/;JacquelineFeldscher.(2019).“JimMattisRejoiningGeneralDynamicsBoardofDirectors,”Politico,https://www.politico.com/story/2019/08/07/jim-mattis-general-dynamics-defense-contractor-3702067;TaraCopp.(2019).“Trump’sDefenseSecretaryFacesEthicsComplaintOverBoeingPromotion,”MilitaryTimeshttps://www.militarytimes.com/news/your-military/2019/03/13/shanahan-faces-ig-complaint-over-boeing-ties/;TrevorHunnicutt.(2021).“Biden’sDefenseNomineeCouldGet$1.7MillionasHeLeavesRaytheon,”Reuters,https://www.reuters.com/article/us-usa-biden-defense/bidens-defense-nominee-could-get-1-7-million-as-he-leaves-raytheon-idUSKBN29F0EO.98BenFreeman.(2020).“U.S.GovernmentandContractorFundingofAmerica’sTop50ThinkTanks,”ForeignInfluenceTransparencyInitiative(FITI);CenterforInternationalPolicy,https://3ba8a190-62da-4c98-86d2-893079d87083.usrfiles.com/ugd/3ba8a1_c7e3bfc7723d4021b54cbc145ae3f5eb.pdf.99BenFreeman2020.

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industry-friendlypositionsoneverythingfromthenavalbuilduptopurchasesoftheF-35tonuclearweaponspolicy.

Contractor-affiliatedindividualsarealsowellrepresentedinkeygovernment

advisorybodies.Forexample,asnotedabove,themajorityofmembersoftheNationalDefenseStrategyCommission(NDSC),aCongressionallymandatedtaskforcethatevaluatedthePentagon’s2018nationaldefensestrategy,hadclosetiestomilitarycontractors.100Notsurprisingly,theCommissionproposedsharpincreasesinPentagonspending—3to5percentperyearaboveinflation—anapproachthatwouldpushPentagonspendingwellabove$1trillionbeforetheendofthisdecade.101

Box3.Recommendations

Reininginexcessprofitsforweaponscontractors,preventingwaste,fraudandabuse,andincreasingtransparencyandaccountabilityoverprivatefirmsinvolvedinconductingorpreparingforwarinvolvesthreemajortypesofinitiatives.

Thefirstisreducingspendingonwarandpreparationsforwarinlinewithamoremodern,realisticdefensestrategy.Anewstrategyshouldincreasetheroleofdiplomacy,focusonemergingandpersistentnon-militarysecuritychallenges,andreducedirectandindirectforeignmilitaryinterventionsofthetypetheUnitedStateshasengagedinIraq,Afghanistan,Syria,Somalia,Yemenandsomanyplacesbeyond.TheCenterforInternationalPolicy’sSustainableDefenseTaskForcehasoutlinedanapproachthatcouldsaveover$1.2trillionoverthenextdecadebyadoptingamorerealisticapproachtothechallengesposedbyRussiaandChina;relyingmoreonalliestoaddresssecurityrisksintheirownregions;pursuingdiplomaticsolutionstoactualandpotentialnuclearproliferationinIranandNorthKorea;rollingbackthePentagon’s$1.7trillion,threedecadelongnuclearrearmamentprogram;andcuttingexcessbureaucracy,includingreducingthePentagon’semploymentofover600,000privatecontractpersonnel.102 Thesecondapproachtocurbingexcesscontractspendingismorerigorousmonitoringandregulation,includingstrengtheningtheroleofinspectorsgeneral,auditors,andcontractingofficersinrootingoutcorruptionandnegotiatingfairpriceswithcorporatesuppliersofeverythingfromsparepartstofinishedweaponssystems;andincreasing

100DanGrazier.(2018).“PanelofDefenseLobbyistsandRevolvingDoorDoyensCallsforMoreDefenseSpending,”ProjectonGovernmentOversight,https://www.pogo.org/analysis/2018/12/panel-of-defense-lobbyists-and-revolving-door-doyens-calls-for-more-defense-spending/101RyanAlexander.(2018).“PentagonCommissionIgnoresGreatestThreat:TheDebt,”TheHill,https://www.taxpayer.net/national-security/pentagon-commission-ignores-greatest-security-threat-the-debt/.102“SustainableDefense:MoreSecurity,LessSpending,”(2019).SustainableDefenseTaskForce,CenterforInternationalPolicy,https://static.wixstatic.com/ugd/fb6c59_59a295c780634ce88d077c391066db9a.pdf.

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transparencyinPentagonspending,includinggettingthedepartment’sfinancialhouseinordersothatitcanfinallypassanaudit.103 Last,butnotleast,aremeasurestoreducethepoliticalpowerofarmsmanufacturers,includingreformingpublicfinancingofelectionsandotherinitiativestoreducethevalueofprivatemoneyinthepoliticalprocess,andcurbsontherevolvingdoorbetweengovernmentandindustry.Revolvingdoorreformsshouldincludeimposinglongercoolingoffperiodsbetweengovernmentserviceandemploymentinthearmsindustry,closingloopholesincurrentlaws,andincreasingdetailedreportingonrevolvingdooremploymentandthepost-governmentactivitiesofpersonnelwhomovefromCongress,thePentagon,andotherkeyagenciestopositionsinthedefensesector.104Inaddition,thinktanksshouldbetransparentaboutfundingsourcesandidentifypotentialconflictsofinteresttiedtocorporatedonations.105

Reducingtheprofitsofwarultimatelydependsonreducingtheresorttowarinthefirstplace.Likewise,makingwarlessprofitabledecreasestheincentivetogotowar.GiventheimmensefinancialandhumancostsofAmerica’spost-9/11wars—andthenegativesecurityconsequencesgeneratedbymanyoftheseconflicts—adoptinganew,lessmilitarizedforeignpolicyshouldbeacentralgoalofthepublicandpolicymakersalike.Recentdevelopments,likethewithdrawalofU.S.troopsfromAfghanistan,arestepsintherightdirection,butmuchmoreneedstobedonetoachieveapolicythatprioritizesdiplomacyoverwarandpreparationsforwarandholdsaccountablethosewhoengageincriminalconductand/orprofiteering.

103MandySmithberger.(2021).“PentagonSpending:RipeforReductionandReform,”TestimonytotheSenateBudgetCommittee,https://www.pogo.org/testimony/2021/05/pentagon-spending-ripe-for-reduction-and-reform/.104MandySmithberger.(2018).“BrassParachutes:TheProblemofthePentagonRevolvingDoor,”(pp.39-40).ProjectonGovernmentOversighthttps://www.pogo.org/report/2018/11/brass-parachutes/.105EliCliftonandBenFreeman,“RestoringTrustintheThinkTankSector,”QuincyInstitute,May10,2021,https://quincyinst.org/report/restoring-trust-in-the-think-tank-sector/.