War Profiteer of the Month: Lockheed Martin
The world's #1 military contractor, responsible for the U-2 and SR-71 spy planes, F-16, F/A-22 fighter jet, and Javelin missiles. They've also made millions through insider trading, falsifying accounts, and bribing officials.
This Bethesda, Maryland-based company is the world's #1 military contractor as well as the world’s largest arms exporter. Lockheed Martin built the U-2 and the SR-71 Blackbird spy planes. Today they make F-16, F/A-22 jet fighter, Hellfire and Javelin missiles, as well as designing nuclear weapons. Its F-117 stealth attack fighters were used to “shock and awe” the population of Iraq at the start of the US invasion, while since the start of that war the Air Force has increased production of Lockheed’s PAC-3 Patriot missile – which cost $91 million per copy.
According to the Arms Trade Resource Center, Lockheed Martin gets $105 from each U.S. taxpayer and $228 from each U.S. household. In 2002 the company was effectively taxed at 7.7% compared to an average tax rate for individuals of 21-33%.
In late 2001 the company was awarded the world's largest weapons contract ever, a $200 billion deal to build the Joint Strike Fighter, a "next-generation" combat jet that eventually will replace aircraft used by the Navy, Air Force and Marine Corps. In the last few years the SEC has investigated Lockheed for insider trading and falsifying their accounts.
Lockheed Martin did not win the contract on force of personality alone, or fighter plane design. During the calendar year 2000, Lockheed Martin spent more than $9.8 million lobbying members of Congress and the Clinton administration, more than double the $4.2 million the company spent during 1999. Among the company's newest lobbyists: Haley Barbour, the former chairman of the Republican National Committee. During the 1999-2000 election cycle, Lockheed Martin contributed just over $2.7 million in soft money, PAC and individual contributions to federal candidates and parties. More than two-thirds of that money went to Republicans. Lockheed Martin spends more on lobbying Congress than any of its competitors, spending a whopping $9.7 million in 2002. Only General Electric and Philip Morris reported more lobbying expenses. And in the 2004 election cycle, Lockheed contributed more than $1.9 million.
Lockheed has also been able to exercise its influence in a larger way – in support of the invasion of Iraq. The company’s former vice-president Bruce Jackson chaired the Coalition for the Liberation of Iraq, a bipartisan group formed to promote Bush’s plan for war in Iraq. Bruce Jackson was also involved in corralling the support for the war from Eastern European countries, going so far as helping to write their letter of endorsement for military intervention. Not surprisingly, Lockheed also has business relations with these countries. In 2003 Poland shelled out $3.5 billion for 48 F-16 fighter planes, which it was able to buy with a $3.8 billion loan from the US.
In 1976 Lockheed paid millions of dollars to Japanese government officials to smooth the way for the sale of Lockheed's airplanes to a Japanese airline corporation, All Nippon Airways. They paid Japanese gangster and yakuza chief Kodama Yoshio $2.1 million in payoffs to help them sell their new wide-bodied passenger airplane, the TriStar L1011, against stiff competition from Boeing and McDonnell-Douglas. Kodama relied on familiar yakuza techniques to force the resignation of Tetsuo Oba, president of All Nippon Airways. At a stockholders' meeting, Kodama packed the room with "sokaiya" -- financial specialists -- who leaked information about an illegal $1 million loan which had been paid to Oba. In disgrace, ANA's president stepped down to be replaced by a candidate favorable to Kodama's interests.
The former prime minister, the former minister of transportation, and the former parliamentary vice-minister of transportation were arrested and prosecuted. The former prime minister was sentenced to four years imprisonment with forced labor but he died while the case was in the Supreme Court.