Lockheed Martin's Herculean Efforts to Profit From Defense Spending

http://truth-out.org/opinion/item/15037-lockheed-martins-herculean-efforts-to-profit-from-defense-spending



C-130 Hercules from the 36th Airlift Squadron, Alaska Air National Guard, and Tennessee Air National Guard taxi out for a mission during an eight-ship sortie at Yokota Air Base, Japan, on June 5, 2012.

Lockheed Martin's Herculean Efforts to Profit From Defense Spending
Sunday, 10 March 2013 11:58 By Jeremiah Goulka, Tom Dispatch | Op-Ed

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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 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.