March 13, 2019
Glenn A. Fine
Acting Inspector General
U.S. Department of Defense
4800 Mark Center Drive
Alexandria, VA 22350-1500
Re: Request for Investigation of Acting Defense Secretary Patrick Shanahan
Dear Acting Inspector General Fine:
According to news reports, during his tenure at the Department of Defense (“DoD”) Acting Defense Secretary Patrick Shanahan has made numerous statements promoting his former employer Boeing and has disparaged the company’s competitors before subordinates at the agency. Citizens for Responsibility and Ethics in Washington (“CREW”) therefore respectfully requests that the Office of Inspector General investigate these allegations to determine whether Acting Secretary Shanahan violated ethics rules, including the Standards of Ethical Conduct for Employees of the Executive Branch (“Standards of Conduct”) and the Ethics Pledge he signed as a condition of his appointment.
https://www.citizensforethics.org/press ... ng-at-dod/QUOTE:
One prominent example raised in news reports is DoD’s apparent recent decision to request new fighter planes from Boeing.14 According to Bloomberg,
DoD made plans to request $1.2 billion for 12 Boeing F-15X fighter aircraft in its fiscal year 2020 budget request, a decision that reportedly was made “with some prodding” by Mr. Shanahan.15 Bloomberg subsequently reported that DoD would request eight F-15Xs in the 2020 budget request as part of a potential purchase of 80 F-15Xs over the next five years.16
However, “the Air Force has said it does not want” the aircraft, and “military experts seemed baffled by the F-15X decision,” arguing that the jet, unlike the F-35 fighter produced by Boeing competitor Lockheed Martin, “is ineffective against enemies like Russia and China” who have “sophisticated air defense technologies.”17 DoD’s fiscal year 2020 budget proposal ultimately included a request for eight updated models of Boeing’s older F-15 fighter jet at a cost of $1.1 billion.18
In addition to allegations that Mr. Shanahan advocated for his former employer Boeing, his “private remarks” at DoD have raised concerns that he
may “harbor[] an unfair bias against other big military contractors” competing with Boeing for lucrative government contracts.19 In particular,
Mr. Shanahan allegedly criticized Lockheed Martin’s handling of the production of the F-35 fighter jet in meetings with subordinates.
According to public reports, Mr.
Shanahan “repeatedly ‘dumped’ on the F-35 in meetings,” stated that the plane was “f---ed up,” and argued that Lockheed, which won the contract to build the plane over Boeing, “doesn’t know how to run a program.”20
Mr. Shanahan also allegedly stated that if Lockheed’s contract “had gone to Boeing, it would be done much better,” and “slammed” Lockheed CEO Marillyn Hewson.21 As one former official described Shanahan’s comments: “He would complain about Lockheed’s timing and their inability to deliver, and from a Boeing point of view, say things like, ‘We would never do that.’”22
Acting Secretary Shanahan is the first person to lead DoD since the 1950’s to “come purely from the private sector” and with “virtually no government or policy experience.”23 At Boeing, Mr. Shanahan was integral in helping the company win defense contracts and oversaw military programs including Boeing Missile Defense Systems and Boeing Rotorcraft Systems.24 Since Mr. Shanahan’s arrival at DoD, Boeing has been very successful in winning government contracts. For example, in December 2018, public reporting suggested a Boeing “takeover” at DoD, noting that
“in the last six months, Boeing has won three multibillion-dollar competitions for major Department of Defense aircraft programs, despite massive delays in delivering a new tanker fleet to the U.S. Air Force.”25 Those
Boeing contracts with the government included a $2.4 billion agreement with DoD to build Huey helicopters with another company, and beating out Lockheed Martin to win a $9.2 billion contract building training jets for the Air Force.26 Boeing also secured an $805 million deal to build aerial-refueling drones for the Navy.27 In early 2019, Boeing shares increased in value by 6.2 percent after the company beat quarterly earnings expectations and posted annual revenue of more than $100 billion for the first time ever.28https://s3.amazonaws.com/storage.citize ... -FINAL.pdf