WASHINGTON Lt. Col. Grant Hird once commanded the Pentagon's platoon of trouble-shooters at Hughes Aircraft in Tucson, Ariz.

Today, he works for Hughes.

Col. Leon Reed once commanded a similar group at the Pratt & Whitney plant in West Palm Beach, Fla. Today, he works for Pratt & Whitney.

Col. Dorsey J. Talley once commanded the Pentagon's representatives at the General Dynamics plant in Fort Worth, Texas.

Today, he works for General Dynamics.

These examples and countless others illustrate what many regard as a major weakness in the Pentagon's efforts to keep defense contractors in line: Cozy relationships often develop between contractors and the Pentagon officials who supervise them.

Sometimes that relationship appears coziest where it should be toughest between the Pentagon's representatives and the plants where the planes, tanks and submarines are built.

The most tangible evidence of that closeness is jobs.

In the most recent three-year period for which figures are available, according to the Pentagon, more than 3,200 Pentagon officials with the rank of major or above (or the civilian equivalent) have gone to work for defense contractors. The figures are for the Pentagon as a whole and include plant representatives.

Among industry giants, 132 Pentagon officials went to work for Hughes in those three years, 119 for General Dynamics, 74 for McDonnell Douglas, 116 for Boeing, 73 for Lockheed and 181 for Martin Marietta.

The real figures may be three times that high. According to a recent study by the General Accounting Office, the investigative arm of Congress, only about one in three exofficials now working for contractors has filed the reports that are required.

Top Pentagon officials and the defense industry say that on balance, the flow of people is beneficial. Industry needs the officials' expertise, they contend. The national defense effort benefits from the cross-pollination, they say.

But critics, some of them in the Pentagon's own ranks, say the prospect of a job with a contractor can corrupt otherwise honest people.

How, they ask, can the Pentagon win the war against waste if its own troops are snuggling up to the adversary?

PROS & SUPSHIPS

When the Army bays a tank or the Air Force a fighter, they do what you might do if you were buying a customized car.

They go over and kick the tires, test the ignition, twist the steering wheel, rub their fingers on the paint. They look at the price of various special gadgets. If everything's OK, they write a check.

For large weapons, things get highly institutionalized. The Pentagon de

12.17.65

PART 3.

ploys permanent squads of tire-kickers in St. Louis or Seattle, right in the plants where the planes, tanks, missiles and submarines are being built.

The squads are formally called Plant Representative Offices, or PROS. Informally, they're called plant reps. The Army has four PROS, the Air Force 24, called AFPROS, and the Navy 13, called NAVPROS.

The Navy also has 16 SUPSHIPS - pronounced "soup-ships" - to supervise shipbuilding. The Defense Logistics Agency, which for the most part administers smaller contracts in 22,000 plants, has 38 PROS all over

the map.

A typical plant rep's office has 100 to 300 people headed by a colonel or lleutenant colonel or, for the Navy, a captain or commander.

That office includes engineers, auditors, quality control specialists, test pilots.

It includes administrative con-
See DEFENSE, Page 6

LINES OF DEFENSE

Tracking Pentagon Waste

PART THREE

INSIDE

Reducing the price of spare parts. A contracting officer permits stockpiling. The Navy's watchdog at McDonnell Douglas. PAGE 1B, NEWS ANALYSIS

6A

ST. LOUIS POST-DISPATCH

Defense

From page one

tracting of: ficers-among the most powerful people in the plant who give the green light for payments.

The plant reps' offices are the key link. between the Pentagon and its contractors"where the rubber meets the road," as an Air Force official. puts it. They are the eyes and ears of the Army, Navy and Air Force in the plants where America's weapons are made.

In theory, they are among the key protectors of the taxpayer's dollar. And many Pentagon brass swear by their performance.

"They're all tough as nails with that contractor today," said Col. James O. Strickland, a key official of the Air Force Systems Command for contract administration. "I. certainly don't see any currying for favor among those people."

Blurred Lines Of Defense

But many in the ranks tell a different story. Their story is about plant reps who "go native," about blurred lines between contractor and supervisor.

They talk about being vastly outgunned by the contractor's people and about being overruled by Pentagon brass, whose main concern is getting the weapon to the field quickly rather than worrying about the price.

They describe a world of inevitable interaction in which the Pentagon's plant reps and employees of the contractor drive to work in the same car pools, jog at the same company health club, go to barbecues at one anothers' houses.

They talk of plant reps who have relatives working for the contractor which may be the only major employer in the area. And they talk of the ultimate switch in loyalty: the head of a PRO who works for the government until he retires on Friday - and then shows up on the other side of the table. on Monday.

An eloquent description of the problem is provided by Col. Jack Finder, a lawyer who ran the ethics program at the Air Force Contract Management Division at Kirtland Air Force Base in Albuquerque, N.M. The division is responsible for administering $164 billion in Air Force contracts through the PROS in plants.

In October 1982, Finder was Interviewed by the U.S. Office of Government Ethics. The ethics office's report on the interview said:

"Col. Finder and his staff reiterated many times that their biggest problem is AFPRO employees accepting positions with the defense contractors... For example, the head of AFPRO office at Northrop on Friday could become the Northrop Vice President for Quality Assurance on Monday, and Immediately AFPRO employee morale is destroyed.

"Employees openly discuss what the former employee has done over the past few years for the contractor in order to obtain the new job, and wonder why they themselves should be so ethical.

"AFPRO employees must deal with their former employee daily on many matters... and feel betrayed that the contractor now has all the inside knowledge of how the AFPRO operates."

Cultural Conditioning

Ompal S. Chauhan, chief of the Manufacturing Operations Assessment Branch at the Air Force's PRO in the Boeing plant in Wichita, Kan., paints a similar picture.

In testimony before Congress and in a lengthy interview, Chauhan spoke of feelings of despair on the part of the Pentagon's; fleld workers "as they watch their superiors. kowtow to contractors."

Chauhan noted that often, the commander of a PRO knows that the assignment is his last. He knows he'll never be promoted to general or admiral. Under the armed forces' up-or-out policy, he knows he'll need a job in private business before long.

What more logical place to look than to the contractor?

"I and many of my co-workers have observed that when a manager is ready to retire, he doesn't just retire and go to workfor the contractor," said Chauhan, who has

also served in Air Force PROS at Boeing In Seattle, General Dynamics in Fort Worth and at the Albuquerque command center in his 10-year career.

"There is planning Involved. The process begins at least two or three years prior to the separation from government service, and the manager becomes increasingly soft on the contractor.

"To get the job, he must know someone ... He must do things which his future employers like... Consciously or unconsciously, the thought of future security begins to affect him."

It also affects his employees, Chauhan said.

The top man has authority over promotions, bonuses, transfers. And he doesn't want any big tussles with the contractor. "This translates into a type of cultural conditioning, and the message is clear: 'Don't rock the boat."""

A boss who wants a job with the contractor, Chauhan said, "is more likely to reward those who do not discover problems than those who do."

: "When your promotions and bonuses are based on not finding anything wrong, you learn to find nothing wrong, and you finally become conditioned to believe there is nothIng wrong."

James L. Ranew, the Army's top official for contract administration, feels the Pentagon has taken a bad rap on some of the horror stories about overpriced parts. But he acknowledges the blurring of loyalties that can occur between the watchdog and the contractor.

"You'll be talking to a contracting officer in the field, and all of a sudden, the word 'we' is used," Ranew said in a recent interview. "And you're not sure who the 'we' refers to."

The plant rep could, he said, be referring to himself and the contractor rather than himself and the Pentagon.

"They live next door to each other," Ranew said. "They belong to the same or ganizations and societies. It's almost impossible to escape some influence."

Missile Off Target

Tucson is missile country.

The Hughes plant in Tucson manufactures some of the most advanced missiles in the U.S. arsenal: the Maverick air-to-ground missile, the Phoenix air-to-air missile; the TOW anti-tank missile.

The revolving door has swung freely at Hughes in the last several years. Lt. Col. Grant Hird, the head of the Air Force PRO there, went to work for Hughes. So did one of his branch chiefs. So did at least two auditors. So did three program managers for the Maverick missile.

During that time, problems arose with the Maverick. Chauhan, who was then at the command center in Albuquerque, recalls trying to get information on the Maverick from Hird, who was still the Air Force's top plant rep at Hughes. Chauhan says Hird told his staff not to provide the information.

Tues., Dec. 17, 1985.

ST. LOUIS I

Defense

From page six

noted that someone like him, who has spent a career in government procurement, won't find that experlence readily usable by a commerclal company.

"Being in the business for 20-odd years, it would be difficult to seek employment in this career field without applying to one of the defense contractors," Hird said.

Chauhan notes that it may be impossible to pin specific responsibilIty on former Pentagon watchmen who went to work for Hughes. But he and others consider it an example of the fact that the revolving I door can go hand in hand with laxity in monitoring a contractor.

His solution: bar Pentagon officials from going to work immediately for a company that they directly supervised.

Chauhan also suggests putting young, aggressive managers in charge of PROS career men on the way up who won't be looking for a civilian job soon.

"The temptations are there," Chauhan said. "You risk turning honest people into dishonest people. I think we should take away the temptation."

Overlooking
Spare Parts

When Leon R. Reed crossed over from heading the Air Force PRO in West Palm Beach to working for Pratt & Whitney in 1979, he wasn't the first. Or the last.

A predecessor had done the same thing. So did a successor later on.

While the revolving door was swinging, a Pentagon auditor named George B. Spanton was questioning how much Pratt & Whitney was charging the government. He questioned the company's entertainment expenses, its salaries.

He also questioned its billings for spare parts on the engines it makes for fighter planes. Spare parts was the area Reed was assigned to after going to Pratt & Whitney.

When a frustrated Spanton made his findings public, his superiors at the Defense Contract Audit Agency tried to transfer him. They were Joined by Col. John Roberts, who was then head of the Air Force PRO office.

In the end, the head of the Defense Contract Audit Agency was fired for retaliating against Spanton. Reed, who expressed reluctance to discuss the matter, remains in

charge of spare parts for the F-100 engine at Pratt & Whitney.

Slowing Of
Revolving Door

While this was happening, a young Air Force lawyer named Jeffrey P. Rohm, legal adviser to the Air Force PRO at Pratt & Whitney, had his own idea about the revolvIng door.

He wanted to close it.

Rohm noted the steady stream of people going from PROS to the contractors. He noted that existing conflict-of-interest laws didn't prevent that, so long as the officials refrained from specifically prohibited activities afterward.

What concerned Rohm was the sheer availability of the job itself and the impact it might have on an officer's judgment while he was still working for the government.

Rohm's suggestion: a one- to three-year ban on employment with a contractor over whom an officer had direct supervision. Somebody from the West Palm Beach PRO could go to work for McDonnell Douglas or Northrop or Lockheed but couldn't simply switch overnight from watchdog to employee at Pratt & Whitney.

His suggestion got nowhere in the Air Force. But when two House members proposed a bill to slow the revolving door, Rohm testified for it.

At a hearing last spring, Rohm listened in amazement as Chapman B. Cox, general counsel of the Department of Defense, brushed aside the idea that an official might relax his standards to curry favor with a future employer.

"We have not seen evidence of this," Cox declared. "On the contrary, a contractor is more likely to hire a departing DOD official who has aggressively represented the government's interests."

Rohm countered, "This statement is preposterous. Essentially, what it's saying is that under the current regulations, government employees cannot accept coffee or doughnuts, but they can accept jobs from a contractor, and this will not affect their judgment or integrity.

"I think this flies in the face of common sense."

Rohm talked about the gray areas -the issues of cost allowability that the rule book doesn't resolve. Even at the fifth decimal place, giving the company the benefit of the doubt can cost the government hundreds of thousands of dollars.

"There's a natural human tendency, I belleve, to regard someone a little bit differently if you think they are going to make you a job offer,"

Rohm said. "I saw a regular stream of retirees from my AFPRO approach the contractor."

In an interview, Rohm spoke of the atmosphere in a typical Air Force PRO office.

The Pentagon's people are vastly outnumbered by the contractor's employees. At Pratt & Whitney, the Pentagon has 110 people to monitor 7,000 company employees; 289 to monitor 74,000 at Boeing in Seattle; 210 to monitor 35,000 at Northrop in California; 279 for 18,000 at General Dynamics in Fort Worth.

"The office is physically in the company's plant," he noted. "You may need a company badge to get in. You're hundreds of miles from your command headquarters. You're surrounded by contractor people.

"There's a natural tendency to sympathize with the contractor. Sometimes, there's a tendency to rubber-stamp what the contractor wants. You're in the devil's playground, so to speak."

Thomas S. Amlie, who developed the Sidewinder missile while head of the Navy's weapons lab at China Lake, Calif., feels the biggest problem facing a PRO chief is his personal vulnerability.

Typically, he notes, somebody assigned to head a PRO senses that it's his last assignment. If he were on his way to general or admiral, he'd be commanding a fleet of planes or ships. But the Pentagon's up-or-out policy means he'll soon need a job in private business.

"The average age of an officer at retirement is 43 years," Amlie noted in a memo in 1983. "At the age of 43, he probably has kids in, or ready for, college and a big mortgage and can't afford a large cut in his income..

"Besides, he is at the peak of his intellectual powers, is emotionally involved and doesn't want to quit. We throw him out anyway, no matter how good a job he is doing...

"This nice man (from industry) then comes around and offers him a job at $50,000-$75,000 per year. If he stands up and makes a fuss about high cost and poor quality, no nice man will come to see him when he retires."

Even if he stays in the service, Amlie wrote, "he is taking a chance by making a fuss. The 'system' will, likely as not, discover a newly open job in Thule, Greenland, Adak, Alaska, or some other garden spot...

"To their everlasting credit, many fine officers have made a fuss anyway and suffered the consequences."