FedEx and Pepsi Are Top Defense Contractors? 5 Corporate Brands Making a Killing on America’s Wars

The Pentagon's Stealth Corporations

by Nick Turse and Tom Engelhardt

TomDispatch

At $34 billion, you're already counting pretty high. After all, that's Harvard's endowment; it's the amount of damage the triple hurricanes – Charley, Ivan, and Jeanne – inflicted in 2004; it's what car crashes involving 15-to-17-year-old teenage drivers mean yearly in "medical expenses, lost work, property damage, quality of life loss, and other related costs"; it's the loans the nation's largest, crippled, home lender, Countrywide Financial, holds for home-equity lines of credit and second liens; it's Citigroup's recent write-off, mainly for subprime exposure; it's what New Jersey's tourism industry is worth – and, according to the Center for Strategic and Budgetary Assessments, it's the minimal figure for the Pentagon's "black budget" for fiscal year 2009 – money for, among other things, "classified weapons purchases and development," money for which the Pentagon will remain unaccountable because almost no Americans will have any way of knowing what it's being spent for.

Now, imagine that, due to a little more Pentagon/Bush administration wizardry, even this black budget estimate is undoubtedly a low-ball figure. One reason is simple enough: The proposed $541 billion Pentagon 2009 budget doesn't even include money for actual wars. George W. Bush's wars are all paid for by "supplemental" bills like the $162 billion one Congress will soon pass – so the Department of Defense's $34 billion black budget skips "war-related funding." This means that even the overall figure for that budget remains darker than we might imagine (as in "black hole"). The Pentagon not only produces stealth planes, it is, in budgetary terms, a stealth operation. If honestly accounted, the actual Pentagon yearly budget, including all the "military-related" funds salted away elsewhere, is probably now more than $1 trillion a year.

There is, however, another stealth side to the Pentagon – the corporate side where a range of giant companies you've never heard of are gobbling up our tax dollars at phenomenal rates. Nick Turse, author of the single best account of how our lives are being militarized, our civilian economy Pentagonized, and the Pentagon privatized – I'm talking about The Complex: How the Military Invades Our Everyday Lives – now turns to the stealth corporate side of the Pentagon to give us a glimpse into the larger black hole into which our dollars pour. Tom

Billion-Dollar Babies

Five stealth Pentagon contractors reaping billions of tax dollars
by Nick Turse

The top Pentagon contractors, like death and taxes, almost never change. In 2002, the massive arms dealers Lockheed Martin, Boeing, and Northrop Grumman ranked one, two, and three among Department of Defense contractors, taking in $17 billion, $16.6 billion, and $8.7 billion. Lockheed, Boeing, and Northrop Grumman did it again in 2003 ($21.9, $17.3, and $11.1 billion); 2004 ($20.7, $17.1, and $11.9 billion); 2005 ($19.4, $18.3, and $13.5 billion); 2006 ($26.6, $20.3, and $16.6 billion); and, not surprisingly, 2007 as well ($27.8, $22.5, and $14.6 billion). Other regulars receiving mega-tax-funded payouts in a similarly clockwork-like manner include defense giants General Dynamics, Raytheon, the British weapons maker BAE Systems, and former Halliburton subsidiary KBR, as well as BP, Shell, and other power players from the military-petroleum complex.

With the basic Pentagon budget now clocking in at roughly $541 billion per year – before "supplemental" war funding for Iraq, Afghanistan, and the president's Global War on Terror, as well as national security spending by other agencies, are factored in – even Lockheed's hefty $28 billion take is a small percentage of the massive total. Obviously, significant sums of money are headed to other companies. However, most of them, including some of the largest, are all but unknown even to Pentagon-watchers and antiwar critics with a good grasp of the military-industrial complex.

Last year, in a piece headlined "Washington's $8 Billion Shadow," Vanity Fair published an exposé of one of the better known large stealth contractors, SAIC (Science Applications International Corporation). SAIC, however, is just one of tens of thousands of Pentagon contractors. Many of these firms receive only tens or hundreds of thousands of dollars from the Pentagon every year. Some take home millions, tens of millions, or even hundreds of millions of dollars.

Then there's a select group that are masters of the universe in the ever expanding military-corporate complex, regularly scoring more than a billion tax dollars a year from the Department of Defense. Unlike Lockheed, Boeing, and Northrop Grumman, however, most of these billion-dollar babies manage to fly beneath the radar of media (not to mention public) attention. If appearing at all, they generally do so innocuously in the business pages of newspapers. When it comes to their support for the Pentagon's wars and occupations in Afghanistan and Iraq, they are, in media terms, missing in action.

So, who are some of these mystery defense contractors you've probably never heard of? Here are snapshot portraits, culled largely from their own corporate documents, of five of the Pentagon's secret billion-dollar babies:

1. MacAndrews & Forbes Holdings Inc.

Total DoD dollars in 2007: $3,360,739,032

This is billionaire investor Ronald Perelman's massive holding company. It has "interests in a diversified portfolio of public and private companies" that includes the cosmetics maker Revlon and Panavision (the folks who make the cameras that bring you TV shows like 24 and CSI). MacAndrews & Forbes might, at first blush, seem an unlikely defense contractor, but one of those privately owned companies it holds is AM General – the folks who make the military Humvee. Today, says the company, nearly 200,000 Humvees have been "built and delivered to the U.S. Armed Forces and more than 50 friendly overseas nations." Humvees, however, are only part of the story.

AM General has also assisted Carnegie Mellon University researchers in developing robots for the Pentagon blue-skies outfit, the Defense Advanced Research Projects Agency's "Grand Challenge," an autonomous robot-vehicle competition. Last year, AM General and General Dynamics Land Systems, a subsidiary of mega-weapons maker General Dynamics, formed a joint venture "to compete for the U.S. Army and Marine Corps Joint Light Tactical Vehicle (JLTV) program." AM General has even gone to war – dispatching its "field service representatives" and "maintenance technical representatives" to Iraq, where they were embedded with U.S. troops.

As such, it's hardly surprising that, earlier this year, the company received one of the Defense Logistics Agency's Outstanding Readiness Support Awards. Nor should anyone be surprised to discover that a top MacAndrews & Forbes corporate honcho, Executive Vice Chairman and Chief Administrative Officer Barry F. Schwartz, contributed a total of at least $10,000 to Straight Talk America, the political action committee of presidential candidate John McCain, who famously said it would be "fine" with him if U.S. troops occupied Iraq for "maybe a hundred years" (if not "a thousand" or "a million").

Perhaps hedging their bets just a bit, MacAndrews & Forbes is diversifying into an emerging complex-within-the-Complex: homeland security. Recently, AM General sold the Department of Homeland Security's Border Patrol "more than 100 HUMMER K-series trucks for use in border security operations."

2. DRS Technologies, Inc.

Total DoD dollars in 2007: $1,791,321,140

Incorporated during the Vietnam War, DRS Technologies has long been "a leading supplier of integrated products, services, and support to military forces, intelligence agencies, and prime contractors worldwide"; that is, they have been in the business of fielding products that enhance some of the DoD's deadliest weaponry, including "DDG-51 Aegis destroyers, M1A2 Abrams Main Battle Tanks, M2A3 Bradley Fighting Vehicles, OH-58D Kiowa Warrior helicopters, AH-64 Apache helicopters, F/A-18E/F Super Hornet and F-16 Fighting Falcon jet fighters, F-15 Eagle tactical fighters… [and] Ohio, Los Angeles, and Virginia class submarines." They even have "contracts that support future military platforms, such as the DDG-1000 destroyer, CVN-78 next-generation aircraft carrier, Littoral Combat Ship, and Future Combat System."

In addition to 2007's haul of Pentagon dollars, DRS Technologies has continued to clean up in 2008 for a range of projects, including: a $16.2 million Army contract for refrigeration units; $51 million in new orders from the Army for thermal weapon sights (part of a five-year, $2.3-billion deal inked in 2007); a $10.1 million contract to build more than 140 M989A1 Heavy Expanded Mobility Ammunition Trailers (to transport "numerous and extremely heavy Multiple Launch Rocket System pods, palletized or non-palletized conventional ammunition and fuel bladders"); and a $23 million deal "to provide engineering support, field service support, and general depot repairs for the Mast Mounted Sights (MMS) on OH-58 Kiowa Warrior attack helicopters," among many other contracts.

more at link
[link to www.tomdispatch.com]
edited to 50%

Last Edited by SPUD on 09/07/2011 09:04 AM

War is our top export. The Pentagon is the top consumer of oil. We live only to keep it alive.

I was just saying that last week.

I said to my girlfriend, we go to war in the middle east so they can add most chilies.

Now they serve baby back ribs, but arent they non pork eating peoples?

Why is this such a big deal to you? The government has to get its equipment and food from somewhere. These companies probably offered to complete the deliveries of their products at the lowest cost to the government and were awarded the contracts.

Whether you agree with politics or not the government doesn't manufacture or grow the vast majority of its own stuff. A business exists for the sole purpose of making an income, that's why it's called a business, not a charity.

It's the world we live in, everything boils down to money. Who gives a shit who you are selling your product to right? Money is money. Fuck the rest.

War is business.

Too bad Rumsfeld's idiotic moves to gut the military made the profit pool dry up into total monopoly by a selected few firms.

The new TWOT style conflicts do not seem to be very profitable for the old war machine. Seems it is a gorging by multi-national corps that come in behind their muscle.

The muscle seems to have no brain though, and is easily led.

Words of wisdom, my friend.

And what's your point exactly??? Private, for profit companies have the government waving lots of printed currency for products and you expect them to say no? Let's keep the blame where it belongs... bloated government. Not the private companies who government buys from. Next you'll have the feds nationalize all these companies so they can stop making their "evil" profits.

Nice!

Image is a much clearer representation of what is happening in our current governmental climate than the old one:

"As an economic system, fascism is socialism with a capitalist veneer. The word derives from fasces, the Roman symbol of collectivism and power: a tied bundle of rods with a protruding ax. In its day (the 1920s and 1930s), fascism was seen as the happy medium between boom-and-bust-prone liberal capitalism, with its alleged class conflict, wasteful competition, and profit-oriented egoism, and revolutionary Marxism, with its violent and socially divisive persecution of the bourgeoisie".

[link to www.econlib.org]

It has been in plain sight all along

[link to www.google.com]

And more recently [link to www.google.com]

To All, Boycott , Boycott,Boycott let's see how long they stay in business without the people buying their products. the white rose

yep you have just described this country well. I would not see my product if I made one to THEM.

Yes, sir, wars are for profit...they are not fought out of the socalled noble deeds we are told they are for.
Soldiers are truly pawns in the game. We as citizens are duped into believing that we should sacrifice our children for some patriotic cause.
I submit that the elite would never sacrifice their children for any war, but they will sit back and deceive us into thinking that our children are doing a service for their country.
Henry Kissinger, a liason for the elite, called soldiers 'dumd stupid animals.'

That's a start, but it appears that these corporations no long need our business. They have a built-in customer in the U.S. GOVERNMENT. We need to END THE FED and END THE WARS...NOW!