Inside the Pentagon: Franklin "Chuck" Spinney
It seemed almost a given that Franklin "Chuck" Spinney, son of an Air Force
colonel, would
devote his life to the U.S. military. What is more surprising is that this
man who would later
be called "the conscience of the Pentagon" by Senator Charles E. Grassley
of Iowa would also
be criticized by many of his colleagues and superiors for his lifetime
of work.
After graduating from Lehigh University in 1967 with a degree in mechanical
engineering,
Spinney started his first post working in the flight dynamics lab at Wright-Patterson
Air Force
Base in Ohio, the very base where he was born. His job was to study the
effects of bullets on
fighter planes shot down in Vietnam. From the start, he was known as a
"brash young
officer" and a "smart-ass lieutenant" but at the same time, hard working
and responsible.
In 1977, Chuck Spinney joined the Pentagon's Office of Program Analysis
and Evaluation (a
division set up in 1961 to make independent evaluations of Pentagon policy)
to work with
John Boyd who, with his open contempt for authority, had become somewhat
of a mentor to
Spinney.
Not long thereafter, Spinney began work on what became his "Defense Facts
of Life,"
commonly known as the "Spinney Report," said to be one of the most important
documents
ever to come out of the Pentagon. In it, Spinney wrote that the pursuit
of complex and
expensive weapon systems was wrecking the budget.
Word of Spinney's bold report and his updates over the next few years quickly
spread within
the Air Force. In response to his 1982 report, according to THE WALL STREET
JOURNAL, at
least one top Pentagon official contended that the report "contain[ed]
data that [was] flawed
and dated and that figures [were] under revision." But all of Spinney's
information was
based on Pentagon documents and was confirmed by the Pentagon to be accurate.
Spinney's superiors were hesitant to give in to pressure to made the report
public. In 1983,
Senator Chuck Grassley and others called on Spinney to testify before the
Senate Budget
Committee but Secretary of Defense Caspar W. Weinberger and director of
the Program
Analysis and Evaluation Office (and Spinney's boss) David S.C. Chu initially
resisted this
request, claiming that the study was only a "purely historical." On threat
of subpoena,
however, Spinney was allowed to brief the Senate committee, with Chu on
hand to present a
rebuttal. The hearing was scheduled for a Friday afternoon, where Spinney's
critics hoped it
would get little press coverage.
As reported in the BALTIMORE SUN years later,
The weekend came and went with only a smattering of news stories, and on
Monday, Defense Secretary Caspar W. Weinberger gathered his staff for a
morning meeting. As they congratulated one another for getting through
Spinney's hearing with a minimum of news media coverage, somebody walked
in and tossed a copy of TIME magazine on the table. Jaws dropped. On the
cover: a painting of Chuck Spinney and the words, "Are Billions Being
Wasted?"
The fact that Spinney's report was unpopular with Pentagon staff was well-documented.
In
August 1984, THE WASHINGTON POST reported that a draft evaluation report
gave Spinney a
rating of "fully satisfactory," a black mark below the grade of "outstanding"
or "exceptional"
that Spinney felt he deserved. As Spinney recounts in his interview with
Bill Moyers,
I decided to nip it in the bud. I had several of my friends go in and talk
to
these guys. They all… the two guys admitted that they were being pressured
to
reduce my performance rating, it was unfair. So essentially we had a case
for a
conspiracy to do an illegal act because it's illegal to take retribution
to a
person who just appeared before Congress, who had testified to Congress….
We created a stink and they backed off. And actually, they actually increased
my performance rating after it was all over.
Allegedly due in part to Spinney's reports, in 1985, Congress imposed a
freeze on defense
spending. But this was far from the end of his battle. Right up to the
present day, Spinney
has continued to speak out about what he views as irresponsible choices
in defense
spending.
A series of articles written for THE WASHINGTON POST by Spinney chronicled
his findings over
the next few years. In October 1988's "Look What $2 Trillion Didn't Buy
for Defense,"
Spinney summarized his defense spending philosophy, criticized the government's
obsession with defense spending as a distraction from meeting more pressing
military needs
and fulfilling Constitutional responsibility to account for expenditures.
In April of 1989, in "Shape Up and Fly Right: How to Build a Better Air
Force for Less Money,"
Spinney wrote that a combination of base closings, consolidating squadrons,
and relying
more on reserve forces would be effective solutions for lowering the Air
Force's operating
costs. The Air Force later said in a rebuttal in AIR FORCE TIMES that Spinney
was neither
"serious" nor "professional."
Later that year, "Teach the Pentagon to Think Before It Spends" examined
the Pentagon's
five year plans. Spinney wrote:
The Pentagon's strategists produce budgets that simply cannot be executed
because they assume a defense strategy depends only on goals and threats.
Strategy, however, is about possibilities, not hopes and dreams. By ignoring
costs, U.S. strategists abdicate their responsibility for hard decisions.
Senator Grassley has remained a great advocate of Spinney's work. In 1995,
he delivered an
impassioned speech appealing to President Clinton and demanding the Pentagon
reform its
accounting mess, citing Spinney's findings.
Spinney continues to find flaws in the defense spending of the current
Bush administration.
In a DEFENSE WEEK commentary in September 2000, Spinney responded to calls
for the
defense budget to be increased from 2.9% of the GDP to 4%, claiming that
such a move
"would be tantamount to a declaration of total war on Social Security and
Medicare in the
following decade." A later commentary by Spinney criticized the Pentagon
for not passing the
previous four annual audits.
Spinney's most recent appearance in Congress was as recent as 2002, when
he testified
before the Subcommittee on National Security, Veterans Affairs and International
Relations,
part of the House Committee on Government Reform on Pentagon accounting
and the
increasing defense budget before 9/11. See Spinney's statement.
Read the transcript of Chuck Spinney's interview with Bill Moyers to hear
about his latest
analysis of defense spending.
Sources: BOYD by Robert Coram, Little, Brown and Company, 2002; TIME
MAGAZINE; NATIONAL JOURNAL; THE WASHINGTON POST; BALTIMORE SUN;
DEFENSE WEEK.
Deception at the Pentagon
Inteview with Chuck Spenney by Bill Moyer
MILLER: For a lifetime of hard work and unyielding integrity,
we're proud to present you with
POGO's Good Government Award.
MOYERS: Earlier this summer Chuck was recognized for his work by POGO, Project On
Government Oversight.
MILLER: Hard not to be impressed with a guy like Chuck who can accuse the Department of
Defense of cooking the books on national television and then return to his office without the
locks being changed.
MOYERS: They never did change the locks. Though at times they may have wanted to...
MOYERS: Why did you do it? Why did you spend all this time a voice in the wilderness, and
things kept getting worse? Why didn't you quit?
SPINNEY: Well, that's a really good question. I don't know.
It hasn't been a negative experience in any sense of the term. It's been a very, very
positive experience. And I have to be honest, I love a good bureaucratic fight. You know? So
I don't feel abused or anything like that. And I would hate for anybody to think that, you
know, I'm one of these guys who thinks he's a martyr or anything. I don't feel that way at
all.
MOYERS: Show me your scars. I mean, pull…
SPINNEY: Yeah. No, I've got the battle scars, but battle scars are a sign of honor. I'm proud
of 'em.
MOYERS: How did your superiors treat you after you appeared on the cover of Time?
SPINNEY: Well, depends on which superior you're talking about. My immediate superiors and
his supervisor were basically supporters of mine. They knew I was… they agreed with what I
was doing. They might wished I hadn't done it 'cause it made their life a little more difficult.
But they basically agreed with what I was saying and they thought it should be said. They
sort of wished they weren't in the line of fire, I expect.
Above them, there was a political appointee who was an assistant secretary of defense and
he basically tried to put pressure on my two intermediate superiors to reduce my
performance rating.
Now, they couldn't fire me because it would just create too overt a thing. So the idea was to
put… the way I surmised it, the idea was to put into place a plan to gradually reduce my
performance rating. Build a track record of non-cooperative and bad behavior. And then fire
me three or four years down the stream. That's the way you do things in the government.
And anyway, I decided to nip it in the bud. We… I had several of my friends go in and talk to
these guys. They all… the two guys admitted that they were being pressured to reduce my
performance rating, it was unfair. So essentially we had a case for a conspiracy to do an
illegal act because it's illegal to take retribution to a person who just appeared before
Congress, who had testified to Congress.
MOYERS: And you told the truth?
SPINNEY: And I to… oh, sure, and no one could rebut. No one could rebut it. In fact, if you
look at my big studies, there's never been a rebuttal that has taken.
MOYERS: You've always been vindicated?
SPINNEY: Yeah. Right. And so…
MOYERS: Your studies.
SPINNEY: Right. So anyway, what happened was we created a stink and they backed off. And
actually, they actually increased my performance rating after it was all over.
MOYERS: Let me come back to your first concern. I mean, why aren't these military budgets
not watched as carefully by the Defense Department as a corporation? Why isn't the
Department of Defense being held accountable?
SPINNEY: Well, you raise a very good point. The President is holding education people
accountable for standards. He says, "I want to have measures, performance measures for
accountability." He also has tried to do the same for foreign aid if you recall.
Over in the Pentagon, we're not holding people accountable.
I think basically here is you have in Congress the oversight committees for defense, which
are essentially the armed services committee. And the defense appropriations
subcommittees in both houses are so tied in to the Pentagon and the defense contractor
base that essentially oversight has been displaced by what some of us call overlook. They're
basically watching the money flow out the door and encouraging it to go.
And basically it's in members of the Senate Armed Services Committee's best interest to
keep the money flowing. It's in the Pentagon's best interest to keep the money flowing.
MOYERS: Because?
SPINNEY: It's in the defense contractors' best interest to keep the money flowing. Because
it's the military industrial Congressional complex and this is their way of life. They live on the
money flow.
MOYERS: The military industrial Congressional complex?
SPINNEY: Right. Which I believe was a term that Eisenhower considered using in his speech,
but he dropped the reference to Congress.
MOYERS: He talked about the military industrial complex. But you say Congress is the
driving force here?
SPINNEY: I don't think there's any simple villain that you can point to and say, "If we fix this,
everything's gonna change. In my opinion it's the product of a long-term evolution that
occurred in the 40 years of Cold War. If you think about it those 40 years were a very unique
period in our nation's history. Now what happened was during that period the different
players in the military industrial Congressional complex basically fine-tuned their
bureaucratic behavior to exist in that environment. It was almost like this self-contained
environment in which a peculiar evolution took place.
A lot like the Galapagos Islands and how the beaks on finches changed from island to
island. And we developed certain practices in order to generate budgets that were more
inwardly focused toward distributing defense pork to our allies around the country.
And one of the most pernicious effects of this trend was the gradual build up of what an
anthropologist might call habitual modes of conduct. Sort of almost like an innate response
of threat inflation. We literally exaggerated a threat to jack up the budgets.
MOYERS: The threat from abroad, from the Soviet Union.
SPINNEY: The threat from the Soviet Union.
MOYERS: Yeah.
SPINNEY: Well, those habits became so ingrained in our system the Soviet Union evaporates
and you still have this acculturated response going on.
MOYERS: Help me to und…
SPINNEY: And that's what makes it scary.
MOYERS: Scary?
SPINNEY: Yeah, because you can't control it.
MOYERS: The people who are supposed to control it benefit from it?
SPINNEY: Exactly.
MOYERS: Tell me how members of Congress benefit from increasing costs like this, driving
weapons systems that the country doesn't need, spending money that puts us deeper and
deeper in deficit. How does Congress gain?
SPINNEY: They gain because they get money flowing to their Congressional districts. It's in
the way Congress gains from controlling the federal budget. They get money flowing to the
districts, that helps build your power bases.
MOYERS: Give me an example.
SPINNEY: Back in 1990, and this may sound like ancient history but I was there. The Senate
Armed Services and the House Armed Services Committee took opposing views on the F-16
fighter. One committee said, "We're gonna terminate production."
The other committee said, "Let's fully fund the Pentagon's request." And of course they were
just setting the stage for a part… for reducing the Pentagon's request but keeping the
program alive. That's the way Washington works.
But as soon as those two positions came out, the Lockheed lobbyists… at that time it was
General Dynamics… The General Dynamics lobbyists hit the streets. And I found out about
this through a very personal way. I had a very good friend who was a Congressional staffer
working for Andy Ireland who was a member from a small citrus growing district in Florida.
Had almost no defense business in his district.
And they received a letter. And the letter basically had about three or four pages. The first
page was a text which said, "The F-16 is absolutely vital for national security." And that was
the first paragraph. And then it basically extolled the economic benefits of the F-16 for the
remainder of the letter.
Attached to that letter were two maps. The first map was the spending for government
financed equipment across the United States. So you saw the dollars in each state scattered
around there. It sort of looked like a bombing chart for the strategic bombing campaign of
identifying the critical targets in Russia back in the old days of nuclear war.
And then the second page was tailored for the particular person who received the letter. In
this case, Andy Ireland was from Florida so it had a map of Florida and it had each
Congressional district in there with the money going by Congressional district.
Well, my friend was just outraged by this. He says, "This is just blatant influence peddling,
you know. And they're just trying to, you know, put the pressure on us." And he was cursing
and rant… he was literally ranting and raving. And I for one of the few times in my life
actually tried to calm someone down. I said, "Wait a minute." I said, "If they sent one to
you, they sent it to everybody. What you ought to do is call 'em up and say, 'This is really a
great display. We can really use it. Could you send us the whole atlas?'"
And he said, "Yeah, you're right." He understood immediately. And he goes, "Yeah, that's
what to do." And so he does it. And within an hour, he had the whole atlas, which then I had
in about two or three hours. It was about this thick. It was for I think 45… 43, 45 states. And
it had each state with all this thing down… all the money listed by Congressional district, plus
of course the national map. And it was down to the dollar. And like in California, I mean the
list was… they had to print small because there was so much money going to so many
Congress… there was just table after table down to the dollar.
Now this is, you know, in the Pentagon we can't account for any of our money. Meanwhile, the
contractors know exactly where it's going, or at least they say they do.
MOYERS: So every Congressman could know what part of the pork was coming into his
district?
SPINNEY: Right. Let's say I'm the program manager for the F-16 in the Pentagon. I get a call
from one of my wholly owned subsidiaries over on the Hill on the armed services committee.
"We got it funded for you guys, but those guys in the House are gonna screw us." So you
know, "You got to do something."
So all I have to do is I call up the program manager at the prime contractor, who I know
because I work with him on a daily basis. And say, "Hey, we got a problem.
"The House is gonna kill our program. The Senate's on board. Turn on the pressure." Well,
at that point, I don't have to do anything in the government. The rest of it takes care of
itself because the people whose future it…are at hand are gonna work overtime to solve that.
The contractors then start calling up the subcontractors. They unleash the fax attacks. They
unleash the emails. And then of course they start calling the lobbyists, the Gucci shoe crowd
on K Street, and say, "Hey, you got to start beating the… beating the pavement in the halls
of Congress. We need some newspaper op-eds." The whole process takes care of itself. One
phone call turns it on.
MOYERS: Who gets the money?
SPINNEY: The contractors get it. The Congressmen get it, you know through… they get the
power because they keep getting voted back in office. They may also get some
Congressional contributions. But I think the bigger benefit is the power, the stability of their
job.
And remember the people in the Pentagon that are promoting this thing are basically…
they're also creating a situation where they can roll over and get into that sector and make
the big bucks. All you have to do is look at the number of retired generals working for
defense contractors.
MOYERS: The revolving door?
SPINNEY: Yeah, yeah. The revolving door.
MOYERS: Have you seen these figures that CEO pay at Lockheed Martin went up from $5.8
million in 2000 to $25.3 million in 2002. I mean, that's five times increase in less than three
years. CEO pay went up at General Dynamics from $5.7 million in 2001 to $15.2 million in
2002. It went up at Honeywell from $12.9 million in 2000 to $45 million in 2002. It went up
from Northrop Grumman from $7.3 million in 2000 to $9.2 million in 2002. What do those
figures say to you?
SPINNEY: Well, that's Versailles on the Potomac in action. It doesn't surprise me. The
Defense Department if you think about how we really operate we essentially operate
according to an internal political economy. It's this closed cell that I mentioned earlier. In
this bubble that developed during the Cold War. And all economies are political economies.
The military industrial Congressional complex is a political economy with a big P and a little
E. It's very political in nature. Economic decisions, which should prevail in a normal market
system don't prevail in the Pentagon, or in the military industrial complex.
So what we have is a system that essentially rewards its senior players. It's a self… what we
call it, we call it, we have a term for it, it's a self-licking ice cream cone. We basically take
care of ourselves. And that's also why we have this metaphor it's Versailles on the Potomac.
It basically is internally self-referencing.
MOYERS: But is…
SPINNEY: So when I see those salaries that you mentioned it's perfectly predictable that
money goes into the defense budget and it gets reflected in these things. While the people
doing the fighting are basically… they're getting more money then they used to get but
they're not participating in this.
MOYERS: Where… and your specialty is the defense budget. Where is the money going?
SPINNEY: Well, it goes into cost growth.
MOYERS: Cost growth.
SPINNEY: Cost growth. We basically if you want to understand how the Pentagon operates
like everything else in Washington you follow the money.
MOYERS: I don't understand the term cost growth.
SPINNEY: Basically the cost of weapons increases faster than the budget. And this has been
going on for 40 years. And when the budget increases, that basically creates an incentive
structure to jack up the cost even further.
Now we saw this in the 1980's. You can think of the 1980's as the mother of all experiments.
And when Ronald Reagan poured money into the defense budget the cost went through the
roof.
MOYERS: Are you saying that costs went up because the…
SPINNEY: The money went in.
MOYERS: The money went in.
SPINNEY: I have data showing that when we reduce the budget the contractors cut their costs.
In some cases they come in under cost estimates when the money dries up. Producing the
same product. It makes no economic sense in any kind of commercial context. It makes
perfect political sense.
MOYERS: Because someone could say that war is not a commercial venture. That it's the…
it's not driven by markets. The markets don't exist in a military economy.
SPINNEY: I agree. And that's why we ought to treat the defense industry as a public sector.
And that would be… and if we did that then you wouldn't see these gross disparities in
salaries creeping in. But essentially if you try to understand what's going on in the Pentagon
and this is the most important aspect, and it gets at the heart of our democracy. Is that we
have an accounting system that is unauditable. Even by the generous auditing requirements
of the federal government.
Now what you have to understand is the kind of audits I'm talking about these are not what
a private corporation would do with a rigorous accounting system. Essentially the audits we
are required to do are mandated under the Chief Financial Officers Act of 1990, and a few
amendments thereafter. But it's the CFO Act of 1990 that's the driver.
And it basically was passed by Congress that required the inspector generals of each
government department, not just the Pentagon, but NASA, health, education, welfare, all the
other departments, interior department where the inspector general has to produce an audit
each year. Saying, basically verifying that the money was spent on what Congress
appropriated it for. Now that's not a management accounting audit. It's basically a checks
and balances audit.
MOYERS: But in laymen terms explain that.
SPINNEY: It's to enforce the accountability clause of the Constitution. Which means that you
can't spend money unless Congress specifically appropriates it. Well, the Pentagon has
never passed an audit. They have 13 or 15, I forget the exact number, of major accounting
categories. That each one has it's own audit. The only one of those categories that's ever
been passed is the retirement account.
Now under the CFO Act of 1990 they have to do this audit annually. Well, every year they do
an audit and the inspector general would issue a report saying we have to waive the audit
requirements, because we can't balance the books. We can't tell you how the money got
spent.
Now what they do is try to track transactions. And in one of the last audits that was done the
transactions were like… there were like $7 trillion in transactions. And they couldn't account
for about four trillion of those transactions. Two trillion were unaccountable and two trillion
they didn't do, and they accounted for two trillion.
MOYERS: So, you mean, they're…
SPINNEY: They don't know where the money's going.
Well, guess what the Senate Armed Services and the House Armed Services agree to do in
their infinite wisdom? They decided to waive the Pentagon's requirement for these annual
audits in their authorization bills. So the Pentagon no longer has to do it.
Now the rationale was that we all know that this is a problem, we don't need to be told every
year. Of course the one good thing about these audits was it would generate a small burst of
news stories every April or May when the audits were due saying the Pentagon can't follow it's
money. You know, there's a trillion dollars unaccounted for.
MOYERS: What does this do to the national ethos?
SPINNEY: Oh, I think it corrupts it. I think it corrupts it. Essentially you have all the
pretensions of a democracy, we're really a democratic republic where you have
representatives of the people in the government, and you have the representatives are
under certain strictures to behave in a certain way. And in fact they're not behaving that way.
MOYERS: Your own…
SPINNEY: It's a fundamental moral issue.
MOYERS: Yeah, you've said it's a moral sewer there on the Potomac.
SPINNEY: That's correct.
MOYERS: What do you mean moral sewer?
SPINNEY: Well, fundamentally we take an oath of office to preserve the Constitution and we
are in fact… in effect undermining the Constitution because we won't address this issue of
accountability.
A lot of the people that are involved in this don't realize the moral implications of what
they're doing. They regard what they're doing as being for the most patriotic of motives.
You know, "We've got to get the money out of Congress. And if we have to lie to get it, we'll
do it. If we have to cook the books in order to sell a program, we'll do it because we're trying
to save the country from the hoards," the Communist hoards or whatever…
MOYERS: And don't you think most people, most ordinary citizens say, "Well, if we have to
endure some waste and some superfluous and some corruption just to be safe, we'll do so"?
SPINNEY: Oh, absolutely. Absolutely. And particularly when you have a political system. It
gets really out of control when you have a political system that caters to fear which is what I
think is going on now.
MOYERS: But the fear is legitimate today, given 9/11 and the war on terror?
SPINNEY: Absolutely. I don't want to diminish the terrorist threat in people's minds.
The problem is that if you start thinking about how you deal with these kinds of threats, you
don't need B-2's. You don't need ballistic missile defense. You don't need Comanche
helicopters. Basically what you need are really highly trained individuals that are basically
understand economics, anthropology, and… as well as fighting, particularly in close quarters
combat which is the most difficult form of fighting.
And basically that these guys can insert themselves and infiltrate these nodes at lower levels
of distinction. Not this nation v. nation conflict.
MOYERS: But wouldn't you con…
SPINNEY: And…
MOYERS: Go ahead.
SPINNEY: …and my point here is those kind of solutions don't generate big budgets. And
that's the problem.
MOYERS: So we keep spending big money on those old systems even…
SPINNEY: For the wrong threat.
MOYERS: But America has just won a war against Iraq. I mean, some people would say,
look, somebody must be doing something right.
SPINNEY: Well, the first thing I would say is Iraq has been under sanctions for ten years or
so. They have a defense budget of 1.8 billion. Most of their equipment is vintage Soviet
equipment. They're untrained. We spend $460 billion when you count the supplemental for
fighting the war to take out Iraq in a month. If you can't do that for $460 billion what can
you do?
MOYERS: Is this $400 billion Congressionally approved budget a scandal in your mind?
SPINNEY: Yes. It isn't gonna fix our problems. It's certainly unnecessary. And you can't look
at this budget in isolation. This budget is being put into place, and it's gonna generate an
enormous tail in the out years because we're politically engineering all these programs and
building up all this support in the Congressional districts. It's gonna be very difficult to turn
this spending off.
MOYERS: This strikes me as somewhat mad.
SPINNEY: It is. We're in Versailles on the Potomac. It's Ver… we basically exist for ourselves.
And we live in a hall of mirrors. It's a good metaphor.
MOYERS: Like Versailles.
SPINNEY: Like Versailles. And you have to remember, our decisions basically are to spend
other people's money, and ultimately to spill other people's blood. We don't pay the price
for these decisions. There's an asymmetric burden of risk.
The risk that the promoters of something like Star Wars or an F-22 or you name it, whatever
kind of weapon bears is a risk that the program might be canceled. But if you look at the
other risk, the other risk, the taxpayer bears the economic risk. Not the program manager.
And the soldier who may have to use this piece of equipment in a serious war. You know, his
life is on the line.
Well, those risks don't really have much of an impact on decision-makers who are more
interested in the preservation of their program.
MOYERS: Chuck Spinney, thank you very much.
SPINNEY: Thank you.