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Defense CEOs are big winners of Iraq war

By Derrick Z. Jackson, 4/30/2003

MORE THAN 130 American soldiers died in a dubious war in a dusty, oil-rich land. In dust-free boardrooms, the CEOs behind our bombs, missiles, tanks, and planes went to corporate heaven. On the dust, 12 teenagers paid the ultimate sacrifice. In the boardroom, men in their 50s and 60s filled their sacks with cash. Twelve soldiers will never see 20. At least 13 weapons executives took home more than $20 million in compensation since 2000. The young paid dearly. Middle-aged and graying CEOs were dearly paid. Neither the clouds of dust nor the closed doors of the boardroom can hide the bankruptcy.

The Boston-based watchdog group United for a Fair Economy, known in general for its reports on the vast pay gap between CEOs and workers, this week published a report on the even more insane gap between soldiers and weapons CEOs. Using federal, corporate, and think tank data, the group found that while the average army private in Iraq earns about $20,000 a year, the average CEO among the 37 largest publicly traded defense contractors made 577 times more money in 2002, $11.3 million.

Since 2000, the 37 defense contractor CEOs (actually, given our first-strike war, it is more appropriate to refer to them as offense contractors) have taken home $1.35 billion. That may not be Bill Gates, but it still means that just 37 men have made enough money in the last three years to, for instance, pay for two years of running the Boston public schools. Meanwhile, everyone knows how the budget cuts have turned public school systems into their own little Baghdads because our governments say there is no more money after war, tax cuts, corporate giveaways, and sports stadiums.

In a less predatory America, it would be rude to brag about financial ''winners'' as a result of the terrorist attacks of Sept. 11, 2001, and the attack on Iraq. Yet between Homeland Security, Afghanistan, destroying Iraq, and rebuilding Iraq it was hard to tell whether offense contractors were patriotic eagles or pouncing vultures. Sacrifice? Not when the $11.3 million average pay of offense industry executives is nearly $4 million a year more than the average for the largest 365 companies surveyed by Business Week.

CEO pay at Lockheed Martin went up from $5.8 million in 2000 to $25.3 million in 2002. It went up at General Dynamics (tanks and submarines) from $5.7 million in 2001 to $15.2 million in 2002. It went up at Honeywell (aircraft systems) from $12.9 million in 2000 to $45 million in 2002. It went up at Northrop Grumman from $7.3 million in 2000 to $9.2 million in 2002.

Pay went up at Alliant (bullets and bombs) from $1.4 million in 2000 to $10.5 million in 2002. It went up at Cardinal Health (medical supplies) from $2.9 million in 2001 to $17.7 million in 2002. It went up at United Defense Industries (guns and cannons) from $794,000 in 2000 to $2.7 million in 2002. At Raytheon (missiles and bombs), it went from $8 million in 2000 down to $2.6 million in 2001 and back up to $8.9 million in 2002.

In a radio address in May 1940, during the defense buildup prior to US entry into World War II, President Franklin D. Roosevelt said: ''Our present emergency and a common sense of decency make it imperative that no new group of war millionaires shall come into being in this nation as a result of the struggles abroad. The American people will not relish the idea of any American citizen growing rich and fat in an emergency of blood and slaughter and human suffering.''

In the same speech, Roosevelt also said, ''We must make sure, in all that we do, that there be no breakdown or cancellation of any of the great social gains which we have made in these past years. We have carried on an offensive on a broad front against social and economic inequalities and abuses which had made our society weak. That offensive should not now be broken down by the pincers movement of those who would use the present needs of physical military defense to destroy it.''

Six decades later, war

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<a href="http://coursesa.matrix.msu.edu/~hst306/documents/indust.html" target="_blank">Military-Industrial Complex Speech, Dwight D. Eisenhower, 1961</a>
[quote]IV.

A vital element in keeping the peace is our military establishment. Our arms must be mighty, ready for instant action, so that no potential aggressor may be tempted to risk his own destruction.

Our military organization today bears little relation to that known by any of my predecessors in peacetime, or indeed by the fighting men of World War II or Korea.

Until the latest of our world conflicts, the United States had no armaments industry. American makers of plowshares could, with time and as required, make swords as well. But now we can no longer risk emergency improvisation of national defense; we have been compelled to create a permanent armaments industry of vast proportions. Added to this, three and a half million men and women are directly engaged in the defense establishment. We annually spend on military security more than the net income of all United States corporations.

This conjunction of an immense military establishment and a large arms industry is new in the American experience. The total influence -- economic, political, even spiritual -- is felt in every city, every State house, every office of the Federal government. We recognize the imperative need for this development. Yet we must not fail to comprehend its grave implications. Our toil, resources and livelihood are all involved; so is the very structure of our society.

In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the militaryindustrial complex. The potential for the disastrous rise of misplaced power exists and will persist.

We must never let the weight of this combination endanger our liberties or democratic processes. We should take nothing for granted. Only an alert and knowledgeable citizenry can compel the proper meshing of the huge industrial and military machinery of defense with our peaceful methods and goals, so that security and liberty may prosper together.

Akin to, and largely responsible for the sweeping changes in our industrial-military posture, has been the technological revolution during recent decades.

In this revolution, research has become central; it also becomes more formalized, complex, and costly. A steadily increasing share is conducted for, by, or at the direction of, the Federal government.

Today, the solitary inventor, tinkering in his shop, has been overshadowed by task forces of scientists in laboratories and testing fields. In the same fashion, the free university, historically the fountainhead of free ideas and scientific discovery, has experienced a revolution in the conduct of research. Partly because of the huge costs involved, a government contract becomes virtually a substitute for intellectual curiosity. For every old blackboard there are now hundreds of new electronic computers.

The prospect of domination of the nation's scholars by Federal employment, project allocations, and the power of money is ever present

and is gravely to be regarded.
Yet, in holding scientific research and discovery in respect, as we should, we must also be alert to the equal and opposite danger that public policy could itself become the captive of a scientifictechnological elite.

It is the task of statesmanship to mold, to balance, and to integrate these and other forces, new and old, within the principles of our democratic system -- ever aiming toward the supreme goals of our free society.

V.

Another factor in maintaining balance involves the element of time. As we peer into society's future, we -- you and I, and our government -- must avoid the impulse to live only for today, plundering, for our own ease and convenience, the precious resources of tomorrow. We cannot mortgage the material assets of our grandchildren without risking the loss also of their political and spiritual heritage. We want democracy to survive for all generations to