Author: hamilton-jerry

GAO Second Guesses DoD on Chinese Materials

Pentagon investigators say they have “found” evidence that Chinese materials were illegally used to make F-35 parts, and further that other weapons systems such as the B-1B and the F-16 also used illegal Chinese materials. http://www.reuters.com/article/2014/03/10/us-usa-china-weapons-idUSBREA291UK20140310

To analysts at http://HamiltonFinanceServices.com (HFS, where former DoD investigators and prosecutors who have dealt with precisely these sort of allegations before now work), this news offers insight not about Pentagon and US Government Accounting Office (GAO) diligence, but rather about how dumbly they behave in the name of national security.

Here’s the scenario: Laws require the Pentagon to buy weapons made with materials, parts, and systems “made in America.” Of course, with tinkering by an active Congress the phrase “made in America” has expanded to include allies of America specified on a US State Department list of approved sources, such as Japan, Britain, France, etc. China is not on the list, so if materials such as metals used to make cheap little magnets for expensive radar systems come from China, the law says it’s illegal and the parts must be replaced with others from approved sources. But remember that Congress is like a ship of active little rats who gnaw at every morsel.

With Congressional approval, DoD obtained and exercised authority in a few cases to waive the “Buy American Act” stringent prohibitions against buying parts composed of Chinese materials. However, not everyone in Congress agreed with those waivers, despite the big weapons makers relying on the waivers to produce their weapons on time under their DoD contracts.

So now Congress is pushing its tools, the GAO and the Comptroller General, to question the waivers granted several years ago in hopes of compelling those big weapons makers to pay for retrofitting the radars with magnets made from approved sources.

Of course, those weapons makers have literally thousands of lawyers, more even than all of the lawyers in the US Department of Justice and DoD combined, ready to wave the waivers in the faces of administrative and federal judges who will eventually hear these cases.

But DoD uses another foul tactic to avoid such litigation by refusing to do business with the big weapons makers who don’t pay quickly and quietly, in this dumb or dumber game. It rarely works, of course, because some members of Congress feel more loyalty to the weapons makers than to the government tail chasers.

As stated, dumb or dumber. That’s the defense contractor business in a nutshell.

What do you think?