Nick Schwellenbach

Is the Whistleblower Protection Act Dead?

A government whistleblower review board has upheld the firing of a federal air marshal for disclosing "sensitive security information," even though the information had not been marked as “sensitive” at the time. And in an ironic twist, the board’s decision was itself labeled "sensitive security information" and posted on a publicly accessible government website, due to a "computer glitch," the board says.

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Military Contractors Are Still Getting the Kid Glove Treatment

The aftermath of the 9/11 terrorist attacks proved a watershed moment for entrepreneurs intent on profiting from militarist U.S. foreign policies. The hawkish agenda of the Bush administration's expansive "war on terror" -- in particular, the wars in Afghanistan and Iraq -- resulted in astonishing growth in the number of military-related contracts to private companies; from 2004 to 2006, U.S. contracts in the two physical war zones grew 50 percent each year. (Erik Prince's Blackwater alone won $485 million in contracts in Iraq and Afghanistan in that period; KBR had the most with more than $16 billion.)

But while some commentators tout private contractors as the possible "future of war," it has become clear that some five years after President George W. Bush began the Iraq War, one of the key government agencies tasked with managing private contracts is bending under the weight of its responsibilities and misplaced priorities.

The auditing agency in charge of overseeing Department of Defense (DOD) contracts has been beset by serious problems that highlight the difficulty of managing private companies selling goods and services to the Pentagon -- a problem that seems to have been exacerbated by the softball approach of former Secretary of Defense Donald Rumsfeld, among other factors. Not all contracts in Iraq are negotiated with the DOD, but with the amount of money spent on the department's Iraq-related contracts since 2003 fast approaching $100 billion, this lack of effective oversight is a significant problem.

According to a recent report by the Government Accountability Office (GAO), on several occasions auditors at the Pentagon's Defense Contract Audit Agency (DCAA), who review contracts between providers of goods and services and the government, altered their findings to benefit contractors.

"Contractor officials and the DOD contracting community improperly influenced the audit scope, conclusions, and opinions of three audits -- a serious independence issue," the GAO stated in its report, which investigated DCAA audits conducted in several of its California field offices alleged to be faulty by auditors blowing the whistle.

The findings sparked outrage from Sen. Claire McCaskill (D-MO), a former state auditor who, with Sen. Jim Webb (D-VA), spearheaded efforts to establish the Commission on Wartime Contracting, created earlier this year. The DCAA's "irresponsible actions" and oversight failure "could be the biggest auditing scandal in the history of [Washington, D.C.]," McCaskill said.

The Senate's Committee on Homeland Security and Governmental Affairs plans to hold a hearing on DCAA on September 10, pointedly entitled, "Expediency Versus Integrity: Do Assembly-Line Audits at the Defense Contract Audit Agency Waste Taxpayer Dollars?"

"The fact that the GAO found that none of the audits investigated had adequate work paper documentation is not a shortcoming. It's a debacle and embarrassment. Zero percent of the audits reviewed were found to comply with government auditing standards," wrote McCaskill in an angry letter to DCAA head April Stephenson, demanding that those responsible be fired. "Employees reported to GAO that they were threatened and made to change their findings to favor contractors, and felt intimidated and harassed concerning their cooperation with GAO."

The broader problem of ineffective oversight at DCAA can be traced in part to staff reductions that make it impossible for auditors to get the job done right. Like many other oversight agencies within the DOD, such as the Office of Inspector General and the Army Criminal Investigation Command, the DCAA's staffing has been cut back significantly, even as the defense budget has skyrocketed. From 1993 to May 2008, the DCAA's staff shrunk from 5,616 to 4,006 employees.

Some of this staffing decline occurred even as the number of contracts to review has increased with the onset of the "war on terror." With fewer staffers and more work, there is less time to carry out the audits. An emphasis on strict performance metrics on the time allotted to auditors to carry out audits has pressured them to cut back on the quality or depth of the auditing, many DCAA auditors say.

In the audits examined by the GAO (not all of which involved war-related contracts), this was found to have been a problem. "Auditors at each of the three DCAA locations told us that the limited number of hours approved for their audits directly affected the sufficiency of audit testing," stated the GAO.

Former DCAA auditors have said this is a problem across the agency. "There's got to be a balance somewhere, but I think in DCAA headquarters' strive to become a lean, mean audit machine, they swung the pendulum too far to the right," former DCAA auditor Ivan Juric told Government Executive. "And by doing that they kind of shot themselves in the foot."

Internal DCAA memos, first reported on and made available by Government Executive, state that the agency is now reviewing its metrics and its staffing levels in the wake of the GAO report.

The threat to the taxpayer due to curbs on DCAA was predicted nearly a decade ago in congressional testimony. "We remain concerned about suggestions to limit or repeal controls that have been proven effective over time, such as the ... Defense Contract Audit Agency," said Eleanor Hill, the Defense Department's inspector general during the Clinton administration, in written testimony in 1999. "We believe that these controls have been critical to maintaining the Government's ability to adequately protect its interests in the acquisition area."

Richard C. Loeb, a Baltimore-based government contract lawyer and professor, says that changes in contracting regulations and in the DCAA over the years have weakened the agency. "Frankly, I'm surprised that DCAA has weathered the past 15 years as well as they have," Loeb said. "The general climate has not been kind to auditors and others involved in oversight of the contracting process."

Meanwhile, the money needed for DOD efforts continues to balloon. More DOD contracts combined with smaller oversight staffs is a formula for failure, as the GAO report noted: "Downsizing of contract oversight staff in the 1990s coupled with hundreds of billions of dollars in increased contract spending since 2000 has exacerbated the risks associated with DOD contract management."

To combat fraud and mismanagement of contracts, McCaskill and Webb created the Commission on Wartime Contracting, which aims to address "the systemic problems associated with the federal government's wartime-support, reconstruction, and private security contracts in Iraq and Afghanistan."

But the bipartisan commission, co-chaired by former DCAA official Michael Thibault, is believed to have met at least once privately and has yet to make any impact on the situation. (Another commissioner, Dov Zakheim, was DOD comptroller from 2001 to 2004, in which capacity he oversaw the DCAA. Zakheim is now vice president of Booz Allen Hamilton, which in the run-up to the Iraq War organized conferences to help U.S. companies win contracts in Iraq.)

One commission member, Charles Tiefer, has said that the DCAA's job was complicated by the attitude of former Secretary of Defense Donald Rumsfeld, who seemed to encourage sympathetic relationships between auditors and contractors.

"Rumsfeld was entirely unsympathetic to 'adversarial auditing' by DCAA," said Tiefer. "He preferred smoothing over disputes between auditors and contractors."

Normally, when the DCAA finds that a contractor's costs are unsubstantiated, the DOD contracting agency aggressively renegotiates, but with contracts in Iraq, this has happened a "peculiarly low" number of times, according to Tiefer, who is also a law professor and a former deputy general counsel of the House of Representatives.

Tiefer pointed to the case of Charles Smith, the former head of the Army's field support division that oversaw Halliburton subsidiary KBR's multibillion-dollar contract for providing services to U.S. troops in Iraq.
After Smith tried to implement a DCAA recommendation to withhold 15 percent of payments to KBR for submitting more than $1 billion in apparent overcharges -- including for meals never served to troops in Iraq and unsubstantiated labor fees and materials purchases -- in 2004 he was removed from his position, effectively ending his 31-year Army career.

In July testimony to the Democratic Policy Committee, Smith said, "Instead of tightening controls over the contract, the Pentagon essentially outsourced oversight" from the DCAA to a private company and waived the standard penalty of withholding 15 percent of payment. "The whole process was irregular and highly out of the ordinary," Smith said.

"The interest of a corporation, KBR, not the interests of American soldiers or American taxpayers, seemed to be paramount," Smith said. "In 31 years of doing this work, I have never seen anything like the way KBR's unsupported charges were handled by the Department of Defense."

After Smith was removed, an unusual arrangement was created to oversee KBR and keep the DCAA at bay, said Smith and other experts. Virginia-based RCI Holding Corporation (later acquired by Serco, a British company) was hired to replace the DCAA's auditing function, said Smith. "They ignored DCAA's auditors," Smith said to the New York Times.

"I have never seen a contractor given that position, of estimating costs and scrubbing DCAA's numbers," Bob Baumann, a former Defense Criminal Investigative Service fraud investigator, told the Times. "I believe they are treading on dangerous ground."

Keeping Tabs on the Peaceniks

More evidence that the U.S. government is justifying surveillance of political dissidence under the guise of monitoring "terrorism" has recently come to light. Early this March an FBI agent's presentation at the University of Texas law school listed Indymedia, Food Not Bombs, the Communist Party of Texas and "anarchists" as groups on the FBI's "Terrorist Watch List" for central Texas.

On March 8, 2006, FBI Supervisory Senior Resident Agent G. Charles Rasner, delivered a guest lecture before professor Ronald Sievert's U.S. Law and National Security class of approximately 100 students. Accompanying his lecture was an "unclassified" PowerPoint presentation titled "Counter-Terrorism Efforts in Texas."

According to UT law student Elizabeth Wagoner's account of Rasner's lecture on Austin Indymedia:

"On a list of approximately ten groups, Food Not Bombs was listed seventh. Indymedia was listed tenth, with a reference specifically to IndyConference 2005. The Communist Party of Texas also made the list. Rasner explained that these groups could have links to terrorist activity. He noted that peaceful-sounding group names could cover more violent extremist tactics."

Wagoner has made a Freedom of Information Act request for Rasner's PowerPoint presentation.

Food Not Bombs (disclosure: the author used to participate in an Austin FNB group) is a moniker for volunteer-run groups that distribute unused vegetarian food from grocery stores and restaurants for free to the general population. Its name stems from a belief that excessive military spending could be redirected to provide food for the hungry. Indymedia is a decentralized grassroots online media outlet, which provides an alternative to the mainstream media coverage.

A self-described libertarian law student who also attended the class wrote on his blog that this list "got many in class riled up."

Rene Salinas, a spokesperson for the FBI San Antonio field office, said that the FBI "doesn't put people on the Terror Watch List for grins." He said that a group has to act or participate in a group connected with terrorism. He declined to say whether any of the groups Rasner mentioned have connections to terrorism or how terrorism is defined. He did say that the Terror Watch List helps keep different law enforcement agencies informed about suspect characters. Salinas described a scenario where the list could help a police officer who pulled over an individual on the list for a traffic violation identify a person that "we might just want to question."

Since 9/11, government surveillance of domestic organizations has increased, raising questions that legitimate political activity and civil liberties are being violated under a sweeping and unjustifiably broad definition of terrorism. Legislative and administrative changes, notably the Patriot Act, have given law enforcement agencies, including the FBI, broadened power to investigate and monitor individuals and organizations. In response to concerns from a bipartisan group of legislators, minor changes were made to the Patriot Act when Congress reauthorized it last month.

At the UT-Austin campus alone, there has been other evidence of government surveillance of political organizations. A 2003 FOIA request by UT Watch uncovered that the University of Texas-Austin participates in the Austin Joint Terrorism Task Force, made up of an FBI liason, and members of the University of Texas Police Department and Austin Police Department. In 2004, FBI agents questioned a UT student after he made a state open records request to UT for information about tunnels underneath the UT campus. The agents asked the student questions such as "Have you ever thought of joining any student activist organizations, like UT Watch?" (Disclosure: The author has been involved with UT Watch.)

Such surveillance has occurred at other campuses as well. For example, the ACLU obtained a FBI report entitled "Domestic Terrorism Symposium" (PDF), which mentions Direct Action, an anti-war group at Michigan State University, and BAMN (By Any Means Necessary), a national group with a chapter at Michigan State that defends affirmative action.

Also this Month, the ACLU released documents showing that Pennsylvania law enforcement was surveilling an anti-war group because of its political activities. Through a Freedom of Information Act (FOIA) request, the ACLU of Pennsylvania obtained documents revealing that the FBI was monitoring gatherings at the Thomas Merton Center for Peace and Justice in Pittsburgh. According to the FBI's own description (PDF), the Thomas Merton Center "is a left-wing organization advocating, among many political causes, pacificism." However, the center is more of a gathering place and resource center "for over 30 different projects," according to the center's website.

Post-9/11 government spying operations are reminiscent of those uncovered by 1970s congressional investigations such as the FBI's COINTELPRO program and the NSA's Shamrock and Minaret programs. Congress found that civil liberties and legitimate political activity were suppressed by the government and sought to place these programs under a modicum of oversight to reign in excesses.

The Next Fake Threat

Cars won't start. The electricity and phone lines go out. Electronic devices have their circuits fried. When the aliens first appear in this summer's remake of the 1950s sci-fi flick War of the Worlds, they are accompanied by an intense electrical storm that generates what is known as an electromagnetic pulse (EMP). Of course, the aliens then proceed to wreak further havoc slaughtering humans from their towering, spider-like machines.

However, EMP itself is not science fiction. A congressionally-mandated commission last summer went public with their unclassified executive summary that envisions terrorists detonating a nuclear warhead above the continental United States, unleashing an EMP of catastrophic proportions and thrusting our 21st century information society into darkness. Their report's main recommendation is to spend anywhere from $20-200 billion in the next twenty years to "harden" America's critical infrastructure (e.g. the power industry, telecommunications) from EMP.

Another one of their recommendations is that the United States should "have vigorous interdiction and interception efforts to thwart delivery." Acting Commission Chairman physicist Lowell Wood confirmed that the recommendation included a national missile defense. As the Commission argues, one missile could shut-down the entire United States, which is a powerful argument for missile defense.

The members of the Commission to Assess the Threat to the United States from Electromagnetic Pulse Attack (EMP Commission) have impressive credentials, yet they are also deeply tangled up with pro-missile defense organizations and the defense industry. Given their conflicts of interest and the controversial assumptions behind their report, questions about their credibility arise. Is the EMP Commission's scenario realistic or is it scare mongering to rally support for a pro-missile defense agenda?

According to Charles Ferguson, a nuclear terrorism expert at the Council on Foreign Relations, terrorists would have trouble obtaining a nuclear weapon or the fissile material needed. Moreover, terrorists would likely use simple delivery means like a truck and just blow up a city to produce mass casualties, rather than launching a warhead into the sky hoping to produce EMP. (The EMP Commission vastly understates the price of a SCUD missile, which they tout as a possible delivery means. They have publicly stated that SCUDs can be purchased for $100,000. Steve Zaloga, a missile expert at the Teal Corporation, a defense consulting firm, says for a working model it would cost at least $1 million, and more for the launch system.)

The Commission has also spotlighted Iran as contemplating an EMP attack on the United States. Before Congress, EMP Commission senior staff member and ex-CIA analyst Peter Pry refers to an Iranian political military journal article translated by the CIA to support this allegation. He employs ellipses in an artful, but deceitful way to weave together quotes from this article. Problem is that this journal article doesn't mention EMP or nuclear weapons at all. It discusses attacks on communications, but by computer attacks, not by EMP -- a blatant misuse of documentation to support the EMP Commission's case.

Perhaps the most controversial of the EMP Commission's claims is their insistence that a Hiroshima-sized nuclear detonation (10-20 kilotons) could produce enough EMP to fry circuits across a continent. The EMP Commission points to one of the few case studies available -- the Starfish Prime atmospheric nuclear test of 1962. A 1.4 megaton thermonuclear weapon detonated 250 miles above Johnston Island in the Pacific affected street lamps, circuit breakers, cars and radio stations in Hawaiian, 800 miles to the north. Still, even there the effect was far from comprehensive. Los Alamos National Laboratory physicist Michael P. Bernardin said that "the 30 strings of failed streetlights [from Starfish Prime's EMP] represented only about one percent of the streetlamps on Oahu at the time." And noted physicist Richard Garwin said the Starfish detonation "had barely noticeable effects on military systems."

But Starfish Prime was a thermonuclear device with a yield over a hundred times that of the bomb dropped on Hiroshima. Experts including Garwin and Philip Coyle, former Pentagon director of operational test and evaluation, have expressed skepticism about the EMP Commission's claim that a 10-20 kiloton nuclear device could produce EMP on par with that of a thermonuclear weapon. Both have extensive experience studying EMP.

Coyle has written that even "the U.S. military does not know how to [create thermonuclear-scale EMP from a Hiroshima-sized weapon] today, and has no way of demonstrating the capability in the future without returning to nuclear testing," he said by e-mail to Global Security Newswire. When the United States does not have this ability, needless to say, it's unlikely that terrorist or "rogue" states could easily accomplish such a technological feat. Coyle also wrote in July, 2004 that the Commission's report seems to "extrapolate calculations of extreme weapons effects as if they were a proven fact, and further to puff up rogue nations and terrorists with the capabilities of giants."

Commission member Lowell Wood refused to answer questions on whether rogue states or terrorists could possibly build Super-EMP devices. "You seriously don't expect answers in an unclassified [setting] to those sorts of questions?" he asked in the Newswire e-mail. What isn't classified, however, are the numerous ties between the EMP Commission, pro-missile defense groups and the defense industry. The International Relations Center, a left-leaning organization that tracks the right wing, has even gone as far as saying that EMP Commission chairman William R. Graham "personifies the military-industrial complex." Graham is the former science advisor to and director of President Reagan's Office of Science and Technology Policy.

Besides current Defense Secretary Donald Rumsfeld, Graham was the only other person to be involved in both Rumsfeld Commissions, which explored the threat to the United States from ballistic missiles and in space. Both EMP Commission reports have echoed the alarmism used to justify missile defense and the proposed militarization of space supported by right-wing think tanks like the Center for Security Policy. (CSP is funded, in part, by missile defense contractors Lockheed Martin, Boeing, Northrop Grumman, TRW, and others, according to a July 2002 report by the World Policy Institute.)

It also happens that Graham and his supporters in Congress, Rep. Curt Weldon, R-Pa. and Sen. Jon Kyl, R-Ariz., are all members of the Center for Security Policy's National Security Advisory Council. Last March, Kyl raised the specter of EMP by holding a hearing and writing an eyebrow-raising op-ed for the Washington Post on the subject. Although Weldon didn't become chair of the House Homeland Security Committee last week, he was touting a classified memo Rumsfeld wrote on Weldon's efforts on EMP to try and support his campaign for the position, according to The Hill newspaper. CSP President Frank Gaffney Jr. has been communicating the EMP Commission's stance to papers such as the Dallas Morning News.

Other connections to Graham include Charles Kupperman. Kupperman is Vice President of Strategic Integration and Operations at Boeing's Missile Defense Systems division. Kupperman, Graham and Professor William Van Cleave all taught at Southwest Missouri State University's defense studies department. They are also on the CSP National Security Advisory Council and the board of advisors to pro-missile defense think tank the National Institute of Public Policy.

Kupperman also worked for Graham at Xsirius Superconductivity for the Missile Defense Agency in the 1990s. Because he was chairman of the Strategic Defense Initiative Organization (renamed the Ballistic Missle Defense Organization under President Clinton) at the time, he faced questions about conflicts of interest. In 1991, Graham told the Los Angeles Business Journal that "We [at Xsirius] don't do any SDI work, and I'm certainly excluded from any role, or from gaining any information for us."

But this isn't the only time Graham has been misleading about profiting from policies he's helped craft. Aside from sitting on the board of directors of companies like Swales Aerospace that have recently won Missile Defense Agency contracts, Graham has been president and CEO of a small, but thriving company called National Security Research, Inc. (NSR) since 1997.

In October 1999, Graham testified before the House Armed Services Committee on the threat of an Electromagnetic Pulse Attack. In a statement, in accordance with House rules, Graham said that he had "not received any Federal grants, subgrants thereof, contracts, or subcontracts thereof during the current fiscal year or the two previous fiscal years, and he does not represent any entity in his appearance today before the House of Representatives." Yet, in National Security Research received part of a $250 million GSA contract "to protect the nation's critical infrastructure against physical and cyber attack," as reported by Federal Times in April 1999. Intentionally or not, Graham violated a House rule.

But overall, NSR is not shy about advertising its tight connections with the Pentagon and Congress. More recently, NSR has won missile defense contracts. On its website, National Security Research announced "that it is part of the winning SPARTA Team to provide Scientific Engineering and Technical Assistance (SETA) support to the Missile Defense Agency's Battle Management/Command and Control Directorate (MDA/BC). ... The task order started on July 1st 2005."

NSR was profiled in the March small business newsletter of the Missile Defense Agency. It seems that Graham isn't just borrowed to work on congressional commissions, but that he makes it his business as well. From the MDA newsletter:

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