The revolving door through which senior military leaders pass between retirement and lucrative secondary careers with major defense contractors could cease to spin under the incoming Trump administration.
President-elect Donald Trump on Friday suggested a lifetime ban on military officials, especially those that have a hand in buying weapons and managing contracts, from working for defense companies that build those weapons.
“I think anybody that gives out these big contracts should never, ever, during their lifetime, be allowed to work for a defense company, for a company that makes that product, Trump said during a rally in Baton Rouge, La. “I don’t know, it makes sense to me.”
There is a long-running custom of senior military leaders joining the boards of companies that provided gear and weapons to the Defense Department while those leaders were in a position to sign off on contracts.
The most recent and conspicuous example is Air Force Gen. Mark Welsh, only recently retired as the service chief, being elected to the Northrop Grumman [NOC] board of directors. Welsh currently serves full-time as dean of the Bush School of Government and Public Service at Texas A&M University.
It was during Welsh’s tenure as the most senior Air Force officer, that Northrop Grumman took home a contract to build the B-21 long range strategic bomber, a deal worth an undisclosed amount that runs into the billions of dollars.
Retired Marine Gen. James Mattis, who Trump has tapped to lead the Defense Department, joined the board of General Dynamics [GD] after leaving uniformed service. He is still listed as a director on the company’s website.
Heidi Shyu, who served as the Army’s chief weapon buyer from 2011 through 2015, is now on the board of Roboteam. The company develops and manufactures ground robots that it is trying diligently to sell in bulk to the Army.
Trump repeated his call for a lifetime ban on Defense Department contracting officials joining industry during an appearance on Fox News on Sunday. The thought, Trump said, popped into his head as he contemplated what he deems “massive” cost overruns in defense acquisition.
He has twice in the past week sent tremors through defense stocks by tweeting criticism of specific programs. He first went after Boeing’s [BA] Air Force One, or presidential aircraft, recapitalization program, tweeting that the program was unacceptably expensive at $4 billion. That figure is disputed, but it covers two Boeing 747-8 widebody airliners hardened against electronic attack and equipped with highly sophisticated communication equipment that allows the president to command the military and run the government during a nuclear attack.
Trump then singled out the Lockheed Martin [LMT] F-35 and followed those comments with a tweet Monday morning saying the program was “out of control,” and would be a target for cost saving measures once he takes office.