Fast Track to Defense Jobs Still Starts at Pentagon

On April 30, Victor W. Whitehead was an Air Force colonel, the man in charge of the development, acquisition, management and operation of rocket launch systems for the Air Force Space division in El Segundo.

Ten days later, Whitehead, 49, became vice president of operations for Martin Marietta Commercial Titan Inc. in Denver, a unit of the nation’s leading rocket manufacturer--a company he’d had a hand in giving nearly $5 billion in Air Force rocket contracts during the previous two years.

Civilians at the space division were astounded at the job landed by Whitehead, the director of Air Force efforts to assist the fledgling commercial rocket industry, in which Commercial Titan is the leading player. Complaints have prompted the Air Force’s Office of Special Investigations to probe whether Whitehead’s hiring violated federal ethics laws.

“He made his bed, and now he’s going to sleep in it,” one engineer said.

Illegal Benefits

Whitehead can’t understand the fuss. His new job was cleared, he notes, by one group of Air Force ethics examiners. He filled out all the required forms, ruled out jobs that could have been held in conflict, submitted himself to each and every legally mandated review.

“It’s absolutely within the spirit and letter of the law,” Whitehead said of his new post. “There’s no hairs to be split.”

Once again, a powerful military officer had spun through the Defense Department’s “revolving door”--one of thousands of officials each year who leave government jobs where they influence defense procurement to work for companies that do business with the Pentagon.

Critics have long complained that such job shifts undermine the credibility of the Defense Department’s vast purchasing operations. And their concerns have been freshly inflamed by the summer’s Pentagon procurement scandal, in which former top-level Pentagon officials are suspected of using their government contacts for the illegal benefit of defense contractors. Indictments in that investigation may be announced in the coming week.

“This phenomenon has thoroughly corrupted the entire system,” said Thomas S. Amlie, an Air Force management analyst. The Pentagon’s conflict of interest rules, he wrote in a widely circulated memorandum, have “several holes you could drive an 18-wheeler through.”

Officials of other government agencies regularly quit to work for the companies they regulated or from which they made purchases, but nowhere does the revolving door turn more swiftly than at the Pentagon, an immense bureaucracy integrally tied to an industry for which it is the sole customer.

Every year, between 2,000 and 4,000 military officers and civilian employees quit to go to work for defense contractors, according to Defense Department statistics. At the highest levels, the numbers swell when the White House changes hands; Air Force Secretary Edward C. Aldridge Jr. announced Wednesday, a day after the presidential election, that he was quitting to head a new unit of McDonnell Douglas Corp., the nation’s biggest defense contractor.

Differing Opinions

A General Accounting Office report last year estimated that 26% of Pentagon workers are hired by companies they had dealt with as government employees. More than 20% work on the same project to which they were assigned by the Pentagon. And nearly half take jobs that put them in contact with their former Defense Department colleagues.

“Some individuals leaving DOD and going to work for defense contractors may give the appearance of (1) not having acted in the best interests of the government because they viewed a defense contractor as a potential employer; (2) taking advantage of insider contacts to the detriment of the government, or (3) influencing contract decisions to obtain later employment,” the GAO report concluded.

Yet Congress, the Pentagon and defense contractors have long been unable to agree what, if any, dangers are posed by the revolving door or--as Whitehead’s case illustrates--what to do about it.

Is the flow of knowledgeable personnel between government and industry so vital, as many defense officials contend, that limits on it should be held to a minimum? Or must there be a tight watch, as Pentagon critics say, because military officials too often compromise their ethics out of a desire to be hired into the defense industry after they leave the government?

“There’s been a serious problem since the end of World War II, where we have not been able to come up with a consensus about what to do about ethics in government,” said Robert N. Roberts, a scholar on the history of federal ethics regulation.

The result, Roberts and other analysts say, has been a hodgepodge of overlapping laws whose guidance to those leaving government service is unclear.

“You’ve got a situation now where there are hundreds of different rules and regulations that apply to government employees,” said Roberts, a political science professor at James Madison University in Harrisonburg, Va. “They’re hard to comply with, and they’re very technical.”

Dispute Over Contract

Increasingly, companies are blaming the loss of contracts on the revolving door. The GAO, which reviews federal contract disputes, says a growing number of firms are filing protests alleging that a competitor got an unfair edge by employing a former military official.

Imperial Schrade Corp., one of the nation’s leading knife manufacturers, raised such allegations last year in a protest it filed with the GAO after losing a $15.6-million contract for a new-generation Army bayonet to Phrobis III, a tiny company in Carlsbad, outside San Diego.

A Phrobis employee, Imperial officials alleged, called them before the final bids on the contract were submitted and said it appeared that Phrobis would win. The employee, retired Army Maj. David E. Baskett, claimed that he had worked in the Army office responsible for procuring the bayonet and had helped draw up its specifications, Imperial said.

“We had the best case anybody could ever have,” said the New York-based firm’s attorney, Robert S. Cohen.

Still, the GAO upheld the contract in March, 1987. It accepted the Army’s assurance that Baskett had nothing to do with developing the bayonet program and shrugged off his claim of inside knowledge as “sales puffery.” It relied, too, on the Army’s judgment that Phrobis’ more expensive bayonet was superior to Imperial’s product.

Imperial executives say they were so disgusted by the ruling that they have sworn off further bidding on government contracts.

Rules Not Enforced

Longstanding conflict of interest statutes were designed to prevent such circumstances.

They prohibit retired military personnel from selling defense materiel to their former service. Both civilians and uniformed personnel also are barred from trying to influence government action on matters in which they had direct involvement during their years in the armed forces. Higher-level former procurement officials are required to report their employment by a defense contractor.

But the problem, according to the GAO and other government watchdog agencies, is that the ethics rules have gone unenforced. For example:

* A 1985 review by the Defense Department’s legal office said that the Pentagon’s ethics program was “entirely inadequate” and required a top-to-bottom reorganization.

* Reporting requirements, designed to shed light on potential conflicts, have been widely ignored, investigators say. Of the roughly half of former Pentagon personnel obligated to file reports on their defense industry employment, only 30% did in 1983, the GAO found. The percentage had barely improved by last year, according to a study by the Defense Manpower Data Center.

* The Office of Government Ethics has repeatedly scored the military for failing to monitor disclosure filings. An ethics audit last year of the Office of the Secretary of Defense--where former top-level Pentagon officials are required to file disclosures--found that one in five reports were missing. The list of officials required to file had not been updated in three years, the audit said.

* In August, California Rep. Barbara Boxer (D-Greenbrae) lambasted the Defense Department for accepting what she said was an incomplete disclosure report from Melvyn R. Paisley, a former assistant Navy secretary under investigation in the Pentagon procurement scandal. Boxer, in a letter to Pentagon general counsel Kathleen A. Buck, charged that the department maintained a “laissez-faire attitude” toward disclosure and acted “as an advocate for those whom you are required to police.”

Still, Congress has continued to toughen revolving door restrictions; the tightest limits yet went into effect in April, 1987, a month after the Phrobis decision.

Quayle Involved

The new law, for the first time, prohibits top-level civilians and uniformed officers from taking certain jobs for two years after they leave the Defense Department. They cannot work for defense firms whose contracts they negotiated or whose projects they personally oversaw on a majority of the working days in their last two years in the Pentagon.

But critics say the new law, too, has gaping loopholes.

Exceptions to the regulations--insisted upon in House-Senate negotiations by the vice president-elect, Sen. Dan Quayle (R-Ind.), Democratic congressional aides say--excluded senior, policy-setting Pentagon officials. Also exempted were procurement officials who were heavily involved in a weapons system but did not devote a majority of their time to it.

“We wrote it too narrowly,” said Joseph Cirincione, the House Armed Services Committee aide who helped negotiate the final wording of the law. “People are still going through the door. We haven’t slowed it down at all.”

Robert M. Guttman, at the time Quayle’s chief counsel, said Quayle and other senators, both Republican and Democrat, were not comfortable with the underlying premise of the House proposal: that there is an implicit conflict in going to work for a defense company that one dealt with as a military procurement official.

One of the exceptions insisted upon by the Senate cleared the way for Victor Whitehead’s hiring this spring by Martin Marietta.

Quayle and other senators argued that Pentagon officials should not be barred from working for a subsidiary of a defense contractor that was not itself in the defense business. Why, they asked, should someone be prohibited from working for XYZ Baked Goods Co. just because it is owned by XYZ Bombs & Missiles, Inc.?

Citing the exception, Air Force ethics officials in Los Angeles and Washington ruled that Whitehead could work for Martin Marietta’s Commercial Titan subsidiary, but not for any other part of the the $5.2-billion company, according to correspondence Whitehead supplied to The Times.

The rulings also barred Whitehead from working for McDonnell Douglas, General Motors Corp., United Technologies Corp. and GenCorp Inc.--all major defense contractors with whose space projects he had been intimately involved as assistant deputy commander for launch systems and in other top jobs at the Air Force Space division.

Whitehead, who insisted that he abided by ethics laws in taking the job with Martin Marietta, said the decisions by Air Force judge advocates are evidence of how hard-hitting the new revolving door law really is.

“Does it limit? You bet it limits,” said Whitehead, an acclaimed rocketry expert credited with putting the Air Force’s Titan 34D launch program back in the air after a series of failures. “That’s what the law is designed to do, so that there’s no appearance--and not just appearance, but no conflict of interest.”

The law’s critics, however, say it fails to erase the appearance of conflict in cases such as Whitehead’s.

“The whole point of the revolving door is to eliminate the incentive for the government worker to want to give that contractor a break while they’re overseeing them,” said Danielle Brian-Bland, an analyst with the Project on Military Procurement in Washington. “If he’s overseeing a contract held by Martin Marietta, it’s irrelevant whether he goes to work on that contract or not, because the fact is he’s in a position to benefit them.”

Further Revisions Expected

Martin Marietta, in written responses to questions from The Times, said it saw nothing inappropriate in Whitehead’s hiring.

“We don’t believe there is any conflict of interest nor any appearance of a conflict because of the exemption specifically created by Congress,” the company said. “Also, Whitehead, in his current position, has no direct interface with any Air Force matter that he had direct participation in or control over while in the Air Force.”

While even some critics of the new law say it has heightened military officials’ attentiveness to revolving door issues, some in Congress are expected to propose further revisions of the conflict-of-interest laws next year.

However, many veterans of the legislative wars insist that the last thing the system needs is more tinkering.

Chapman Cox, who resigned as assistant secretary of defense last year to enter a private legal practice in Colorado Springs, Colo., said if his experience on leaving the Pentagon was any indication, the revolving door rules are already out of hand.

“I had to do things that are just absolutely ridiculous--the forms I had to file and things like that,” said Cox, who previously served as Pentagon general counsel and assistant secretary of the Navy. “I’m sure they just pile up mountains of irrelevant material that make it even harder to catch the people who do things that are bad.”