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Will $100 Million in Defense CEO Salaries Make Us Safer?

Words: William D. Hartung
Pictures: Rawpixel

The Senate just approved a $675 billion Pentagon spending bill by a vote of 85 to 7. When defense-related activities like nuclear warhead research and development at the Department of Energy are taken into account, the total figure is well north of $700 billion. Given these staggering sums – among the highest levels since World War II – the obvious question that arises is, are we getting our money’s worth?

As former Secretary of Defense Robert Gates once said, channeling Dwight D. Eisenhower, we should spend all we need for defense but not one penny more. The budget just passed by the Senate fails that test.

Most Americans assume that the bulk of the Pentagon budget goes to support the troops, but this is not strictly true. Hundreds of billions of dollars allocated to the Pentagon go straight back out the door to weapons contractors like Lockheed Martin, Boeing, Northrop Grumman, General Dynamics, and United Technologies. These firms haven’t exactly been careful stewards of our tax dollars.

To cite just one example of many, CEO’s of major defense companies receive exorbitant compensation packages, largely subsidized with public funds. The CEOs of the six top Pentagon contractors cited above received a cumulative sum of over $100 million in salary and benefits in 2017; bringing in other contractors, other executives, and well-paid board members adds hundreds of millions more. By no stretch of the imagination can these payments be seen as helping support the troops or make the country safer, although they no doubt support lavish lifestyles for scores if not hundreds of arms industry executives.

In the context of hundreds of billions in Pentagon spending, the amount going to defense company CEO’s may seem small. But these huge payouts symbolize all that is wrong with a defense system that too often seems like it is better at spending money than it is at defending the country. Reducing these payments in a way that ensures that the government recoups a comparable amount money may be complicated, but Congress needs to address the fact that some defense CEO’s make an astounding 100 times more than the secretary of defense. Along these lines, Sen. Bernie Sanders, I-Vt., has proposed that the Pentagon should not enter into contracts with any company that pays any employee more than $203,000 – the aforementioned salary of the Secretary of Defense.

Another case in point with respect to unnecessary spending that goes to corporations is the Congressional habit of buying more weapons than the Pentagon even asks for, usually egged on by contractors and members with defense jobs in their states or districts. For example, this year’s Senate bill buys three more Littoral Combat Ships than the Navy “wants or needs,” as an analysis at Task and Purpose has noted. That’s great for keeping shipbuilding facilities humming, but it makes no sense strategically to buy a system that is rife with performance problems and has an unclear mission to boot. Add-ons for M-1 tanks, F-35 and F-18 combat aircraft, and numerous other systems have been promoted by Congress in this year’s budget process as well, sucking up billions of dollars, some of which could be used for better purposes like pilot training or efforts to retain specialists with the kind of unique skills that make America’s military the best in the world. Funding these essential functions would no doubt still leave billions available for other, non-military purposes like boosting spending on diplomacy and conflict prevention efforts.

The new Congress that takes office next January should take a hard look at what the Pentagon is truly spending our money on, cutting fat where possible, and starting a thorough debate about what missions our armed forces should be asked to carry out in the first place. Ultimately, asking our military to do unnecessary or unwise tasks is the ultimate form of waste. But there’s plenty that can be done to streamline Pentagon spending while that larger debate goes forward.

William D. Hartung is the director of the Arms and Security Project at the Center for International Policy.

William D. Hartung

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