Lockheed Martin’s Herculean Efforts to Profit From Defense Spending

Posted on Mar 12, 2013

thefixer (CC BY 2.0)

By Jeremiah Goulka, TomDispatch

This piece first appeared at TomDispatch. Read Nick Turse’s introduction here.

When I was a kid obsessed with military aircraft, I loved Chicago’s O’Hare airport.  If I was lucky and scored a window seat, I might get to see a line of C-130 Hercules transport planes parked on the tarmac in front of the 928th Airlift Wing’s hangars.  For a precious moment on takeoff or landing, I would have a chance to stare at those giant gray beasts with their snub noses and huge propellers until they passed from sight.

What I didn’t know then was why the Air Force Reserve, as well as the Air National Guard, had squadrons of these big planes eternally parked at O’Hare and many other airports and air stations around the country.  It’s a tale made to order for this time of sequestration that makes a mockery of all the hyperbole about how any spending cuts will “hollow out” our forces and “devastate” our national security. 

Consider this a parable to help us see past the alarmist talking points issued by defense contractor lobbyists, the public relations teams they hire, and the think tanks they fund.  It may help us see just how effective defense contractors are in growing their businesses, whatever the mood of the moment.

Meet the Herk

The C-130 Hercules is a mid-sized transport airplane designed to airlift people or cargo around a theater of operations.  It dates back to the Korean War, when the Air Force decided that it needed a next generation (“NextGen”) transport plane.  In 1951, it asked for designs, and Lockheed won the competition. The first C-130s were delivered three years after the war ended.

The C-130 Hercules, or Herk for short, isn’t a sexy plane.  It hasn’t inspired hit Hollywood films, though it has prompted a few photo books, a beer, and a “Robby the C-130” trilogy for children whose military parents are deployed. It has a fat sausage fuselage, that snub nose, overhead wings with two propellers each, and a big back gate that comes down to load and unload up to 21 tons of cargo.

The Herk can land on short runways, even ones made of dirt or grass; it can airdrop parachutists or cargo; it can carry four drones under its wings; it can refuel aircraft; it can fight forest fires; it can morph into a frightening gunship.  It’s big and strong and can do at least 12 types of labor—hence, Hercules.

Too Much of a Good Thing

Here’s where the story starts to get interesting.  After 25 years, the Pentagon decided that it was well stocked with C-130s, so President Jimmy Carter’s administration stopped asking Congress for more of them.

Lockheed was in trouble.  A few years earlier, the Air Force had started looking into replacing the Hercules with a new medium-sized transport plane that could handle really short runways, and Lockheed wasn’t selected as one of the finalists.  Facing bankruptcy due to cost overruns and cancellations of programs, the company squeezed Uncle Sam for a bailout of around $1 billion in loan guarantees and other relief (which was unusual back then, as William Hartung points out in his magisterial Prophets of War: Lockheed Martin and the Making of the Military-Industrial Complex).

Then a scandal exploded when it was revealed that Lockheed had proceeded to spend some $22 million of those funds in bribes to foreign officials to persuade them to buy its aircraft.  This helped prompt Congress to pass the Foreign Corrupt Practices Act.

So what did Lockheed do about the fate of the C-130?  It bypassed the Pentagon and went straight to Congress.  Using a procedure known as a congressional “add-on”—that is, an earmark—Lockheed was able to sell the military another fleet of C-130s that it didn’t want.

To be fair, the Air Force did request some C-130s.  Thanks to Senator John McCain, the Government Accountability Office (GAO) did a study of how many more C-130s the Air Force requested between 1978 and 1998.  The answer: Five.

How many did Congress add on?  Two hundred and fifty-six.

As Hartung commented, this must “surely [be] a record in pork-barrel politics.”

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